Paul Singer Blasts "Manipulated" Markets, Says China Collapse "Way Bigger Than Subprime"

Submitted by Tyler Durden on 07/15/2015 19:10 -0400

• Central Banks
 
• China
 
• Federal Reserve
 
• Greece
 
• Institutional Investors
 
• Monetary Policy
• Quantitative Easing
 
• Recession

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This week, dozens of billionaire fund managers, institutional investors, and financial market luminaries descended on that "iconic flagship of Taj Hotels on New York's Fifth Avenue" The Pierre with a mission to "deliver alpha" for conference host CNBC, a network which, incidentally, very often has a difficult time "finding alpha."

On the guest list was Elliott Management’s Paul Singer, who was on hand Wednesday to discuss the perils of investing in a world dominated by Keynesian central planners, paper money, the "craziness" of China’s margin-fueled equity bubble, and "connecting the dots." 

Here are some notable bullets via Bloomberg:

• ELLIOTT’S SINGER: CHINA CRASH 'WAY BIGGER THAN SUBPRIME'
• SINGER ISN’T OPTIMISTIC ABOUT GREEK SITUATION
• SINGER SAYS GREECE SHOULD HAVE PULLED OUT OF EURO

And here's a recap, followed by a short video excerpt: 

China's government "encouraged" an equities boom, and the "craziness" of the country's stock market echoes the late 1920s in the United States, hedge fund manager Paul Singer said Wednesday. 

"It's not just a bull market, it's wild," the founder and president of Elliott Management said at the Delivering Alpha conference presented by CNBC and Institutional Investor.

Activity in China, which has included government efforts to ease policy and ramp up economic growth, reflects an "ever-growing" trend toward intervention, Singer said. He contended that bond-buying and easy interest rates in many corners of the world make it difficult to quantify how much markets are really worth.

China's Shanghai composite index, for instance, has climbed more than 80 percent in the last year. 

"The prices are manipulated by governments," he said, adding that investors "can't trust" the value of some equities.

Singer also criticized the central banks in the United States and Europe, as he decried the risks of continued near-zero interest rate policy from the Federal Reserve. A recession in the U.S. or Europe amid loose monetary policy would turn "truly ugly" for global markets, he said.

A downturn in either area could lead to additional quantitative easing, bringing even more uncertainty into bonds.

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