Stanley Druckenmiller, the billionaire investor who won millions for his customers at the defunct Duquesne Capital, has unveiled his next big move in the financial arena. Druckenmiller is now reportedly going short on the Federal Reserve’s expectations that inflation will keep going down and that the recent interest rate cuts will continue to happen.

In a recent appearance at a conference, Druckenmiller reportedly stated that he is shorting U.S. Treasury bonds. This behavior effectively bets on the Federal Reserve’s inability to continue cutting rates, as the bonds’ value is inversely proportional to the yields, which are in part influenced by cuts.

Druckenmiller’s bet is also related to inflation. He allegedly stated that inflation might reach 1970s levels, preventing the Federal Reserve from maintaining its dovish policy and rendering it incapable of stimulating the economy with more cuts.

Druckenmiller would be putting 15% to 20% of his portfolio on this, making it a big wager on the possible worsening of the U.S. economy, contrary to what the Federal Reserve and economic analysts expect.

The investors’ actions are consistent with his recent statements on the Federal Reserve’s policies and how he was unsure about the effectiveness of its actions. In an interview, he stated that while the reserve believed that monetary policy is restrictive due to current real inflation rates, the market is signaling otherwise. “Equities at a record high, gold at a record high, GDP above trend, credit tight, bank earnings and forecasts look good, crypto going crazy. We don’t see any restrictions whatsoever,” Druckenmiller stressed.

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The bet could also be based on the growth of the U.S. debt and the loss of trust in the government to honor it, causing investors to demand more interest to sustain these instruments.