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UNDERSTANDING AND NAVIGATING THE LONG-TERM DEBT CYCLE

5 MIN WATCH

January 18, 2024

Understanding and navigating the long-term debt cycle

Jake Miller - Cofounder, Opto Investments & Joe Lonsdale, Cofounder Palantir, Addepar, Opto; Founder 8VC
Private Assets

Key takeaways

  • When growth is the dominant factor, stocks and bonds tend to move in different directions. Today, as in the 1970s, stocks and bonds are perfectly correlated, creating a more difficult environment for investors.
  • In the current economic environment, which is dominated by inflation and Fed action, stock and bond prices may move in concert. This argues for finding and making long-term investments that are diversifying for a healthy portfolio.
  • The US has likely entered a prototypical long-term debt cycle, which could potentially last 30 to 40 years

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Important disclosures

Lonsdale Investment Management, LLC (the “Firm”) is a wholly-owned subsidiary of Opto Investments, Inc. and is an SEC-registered investment advisor. Registration with the SEC does not imply a certain level of skill or training. SEC registration does not mean the SEC has approved of the services of the investment adviser.

This website is operated and maintained by Opto Investments, Inc. Certain products described herein and institutional relationships may involve investment advisory services provided by the Firm. This website is presented for financial institutions and investment professionals only and is not intended for individual consumers or retail investors, unless specifically noted.

Unless otherwise indicated, commentary on this site reflects the personal opinions, viewpoints and analyses of the author and should not be regarded as a description of services provided by the Firm or its affiliates. The opinions expressed here are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual on any security or advisory service. It is only intended to provide education about the financial industry. The views reflected in the commentary are subject to change at any time without notice. While all information presented, including from external, linked or independent sources, is believed to be reliable, we make no representation or warranty as to accuracy or completeness. We reserve the right to change any part of these materials without notice and assume no obligation to provide updates. Nothing on this site constitutes investment advice, performance data or a recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

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This information contains certain “forward-looking statements,” which may be identified by the use of such words as “believe,” “expect,” “anticipate,” “should,” “planned,” “estimated,” “potential” and other similar terms. Examples of forward-looking statements include, but are not limited to, estimates with respect to financial condition, results of operations, and success or lack of success of the depicted investment strategy. All are subject to various factors, including, but not limited to general and local economic conditions, changing levels of competition within certain industries and markets, changes in interest rates, changes in legislation or regulation, and other economic, competitive, governmental, regulatory and technological factors affecting operations that could cause actual results to differ materially from projected results.

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