Investors Should Be Aware of These 'Worrisome Paradigm Shifts' In the Market

Credit: The Street
Published on June 18, 2019 - Duration: 03:49s

Investors Should Be Aware of These 'Worrisome Paradigm Shifts' In the Market

What's worrying you in the market?

Doug Kass, a contributor for Real Money, runs Doug's Daily Diary, where he breaks down his trades and his thoughts on the market.

On Monday, Kass wrote about seven paradigm shifts that he's keeping a close eye on.

He broke down two of the major shifts.

Modern Monetary Theory If you've explored FinTwit in the last six months, you've probably heard of the Modern Monetary Theory (MMT).

In simple terms, MMT proposes that countries with their own currency--think United States, United Kingdom, etc.--don't have to worry about accumulating too much debt since the countries can always print more money to pay off interest.

Kass explained that he's a little worried about how quickly people are hopping on the MMT train.

'Unbridled' Fiscal Spending Why is this a worry?

Well, Kass's words speak for themselves.

"The U.S. Treasury posted a record $210 billion deficit in the month of May as government spending climbed to a record $440 billion.

Remember, deficits are supposed to decline as an economic recovery matures; now just the opposite is happening, with deficits now approaching 5% of U.S. GDP," he wrote.

Want to read more from Kass?

You can find his Daily Diary here.

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