Billionaire Ray Dalio’s honeymoon with President Donald Trump is looking to be short lived.
Dalio, who in November was bullish on the incoming president’s ability to stimulate the economy, is now saying he’s more concerned that the damaging effects of Trump’s populist policies may overwhelm the benefits of his pro-business agenda.
“We are now in a period of time when how this balance tilts will be more important to the economy, markets, and our well-beings than normally dominant drivers such as central bank policies,” Dalio and co-Chief Investment Officer Bob Prince said in Bridgewater Associates’ “Daily Observations” note to clients on Tuesday.
Dalio, who runs the world’s largest hedge fund, is souring on the new president after he banned visitors from seven mostly Muslim countries, igniting protests nationwide, and proposed a border tax on Mexican goods. Earlier this month, Dalio said it remained to be seen whether Trump is aggressive and thoughtful, or aggressive and reckless. Dalio and Prince said so far they haven’t seen much thoughtfulness in Trump’s policy moves.
Money managers at hedge fund Carlson Capital take an even more negative view of Trump’s nationalist agenda. His policies may have dire consequences for the U.S. and global economy and his attempts to tax imports and subsidize exports could touch off a depression, according to their quarterly letter to clients.
“If the border adjustment mechanism is implemented as proposed we think it will cause a global depression and a major equity market decline,” Richard Maraviglia and Matt Barkoff said in the letter. “It is still unclear whether it will happen but at the very least we expect that U.S. trade policy will put downward pressure on global growth.”
Billionaire George Soros, who had backed Democrat Hillary Clinton in last year’s election, said in January that the stock market rally since Trump’s win, spurred by his promises to slash regulations and boost spending, will come to a halt. He called Trump a “con man” and a would-be dictator.
After a turbulent week for the French Presidential front-runners, the latest polls show far-right and anti-EU candidate Marine Le Pen gaining traction.
The power plants will utilise high energy, low emissions (HELE) technology that use high-quality black coal.
Japan is the largest overseas market for Australian coal producers, taking more than a third of all exports.
Tom O'Sullivan, a Tokyo based energy consultant with Mathyos Global Advisory, said in the wake of the Fukushima nuclear disaster in 2011, Japan started importing more liquefied natural gas (LNG) from Australia.
But he said the move to more coal fired power was because coal was cheaper than LNG, and the energy security was priority for the government.
"Japan needs to import 95 per cent of all its energy sources," he said.
"So it's trying to diversify its fuel sources and it doesn't want to be too reliant on any one market."
Japan has ratified the Paris Climate Agreement and committed to a 26 per cent reduction in carbon dioxide emissions by 2030.
But Mr O'Sullivan said Japan was yet to price carbon emissions.
"Although Japan spent $US36 billion dollars on commercial solar power last year, and is planning much more, there is no carbon price," he said.
Mr O'Sullivan said while community and environmental groups had expressed concerns about the construction of a major coal power station, Prime Minister Shinzo Abe was firmly behind the plans.
He said the decision would ensure the use of coal in Japan would continue well into the middle of the century.
"These guys [private companies] are not going to go ahead and [put money into] in large capital investments unless they have a 30-year depreciation period," he said.
"So if they're building these coal power plants now it is reasonable to expect them to be still on the books by the end of 2050."
There are a number of different types of HELE power station technologies. In Australia, the CSIRO has been working on different programs to further the use of them.
The Minerals Council of Australia and the Federal Government are on the record saying HELE coal fired power plants produce half of the emissions of traditional plants.
But David Harris, a CSIRO research director in the Low Emissions Technology Department, said it was not as straight forward as that.
