‘Massive helicopter drop of money’ from Fed and Washington raises inflation risk, says manager of $88 billion bond fund MarketWatch 1 day ago
THE TELL
Policymakers are making a big gamble that their extraordinary efforts to stimulate the U.S. economy will not send inflation out of control, but one of the biggest bond fund managers says its an open question if their wager will pan out.
“We had this massive helicopter drop of money without creating more productivity capacity on the other side of it. The big policymaker bet was that by driving demand through the roof, you’re going to incentivize suppliers to expand capacity,” said Tad Rivelle, chief investment officer of fixed income at TCW Group and manager of its $88 billion Metropolitan West Total Return Bond Fund, once the biggest active fixed-income fund.