Billionaire hedge fund manager John Paulson is no stranger to American politics.  He rocketed to fame and literal fortune by correctly betting against the subprime lending market that led to the financial crisis of 2007 and 2008.

And when President Trump threw his hat into the political ring for the first time in the 2016 elections, John Paulson was a big supporter.  As in… a BIG supporter.  This time around, Paulson has contributed a whopping $806,300 to the Trump 47 Committee, according to Forbes.

Why?  It’s very simple.  He has a lot of money he doesn’t want to lose, and he would prefer to keep making more.  And the idea that Kamala Harris might win the election and unleash her economic agenda on U.S. markets… really, really scares him.

John Paulson: I’d go into cash and gold if Kamala Harris is elected @FoxBusiness https://t.co/g2u6J9WCb8

— Liz Claman (@LizClaman) September 17, 2024

Paulson appeared on Fox Business’ “The Claman Countdown” on Monday, and on CNBC’s “Money Movers” a few days before that.  And he didn’t beat around the bush either time about what he thinks will happen if Kamala Harris wins the election in November.  Here he is on CNBC a few days ago:

We’re talking presidential policies with Paulson & Co. Founder John Paulson, who offers predictions on the impact of both the Harris and Trump campaigns’ tax plans. pic.twitter.com/hqJoRQocEw

— Money Movers (@moneymoverscnbc) September 13, 2024

“I think if they implement those policies, we’ll see a crash in the markets.”  I don’t really think it takes a billionaire hedge fund manager to come to that conclusion, but I certainly wouldn’t ignore it when a billionaire hedge fund manager says it!

He said that much and more yesterday while on Fox Business talking to Liz Claman:

Hedge fund billionaire and major Trump fundraiser John Paulson said Tuesday he will pull his money out of the market if Vice President Harris wins the presidential election this fall, saying the Democrat nominee’s economic policies would spook investors.

The Paulson & Co. founder, known for his lucrative bet against the subprime mortgage in 2007, appeared on FOX Business’ “The Claman Countdown,” where host Liz Claman asked him what he sees as the next big bet similar to that.

“Well, I would say it very much depends on who’s in the White House and who controls Congress,” Paulson replied. “I’d be very concerned if Harris is elected and pursues the tax plans and other economic plans that she articulated.”

Paulson said during the interview that former President Trump and Harris’ plans for the economy are very different, noting that Trump wants to extend the 2017 tax cuts implemented during his term in office while Harris wants to let them expire.

He also noted that Harris has proposed raising the corporate tax rate from 21% to 28% and wants to raise the capital gains rate from 20% to 28%.

Those are crazy rates.  What makes a Billionaire hedge fund manager jump ship, pull out tons of money from the markets, and go into cash and gold as a hedge against uncertainty?

LOTS AND LOTS OF UNCERTAINTY… that’s what.  And according to John Paulson, financial uncertainty is spelled K-A-M-A-L-A.  Here’s another clip of him explaining the difference, in his mind, between a potential Harris economy versus a Trump economy:

Paulson & Co. Founder John Paulson expands on why he supports the Trump campaign in the upcoming election, discussing what he’s expecting for both markets and the economy if the former president returns to the Oval Office: pic.twitter.com/FWdyAnioFC

— Money Movers (@moneymoverscnbc) September 13, 2024

Markets hate uncertainty, and that’s what makes this very simple to forecast out.  That’s why what he is saying is so hard to argue with.  Markets HATE uncertainty.  And uncertainty is the most CERTAIN THING about Kamala Harris!

It is basically inevitable that a Harris-Walz administration will usher in a financial sell-off that far exceeds the market’s ability to recover from.  And that means… a crash is coming if Kamala actually wins the election.

With more detail on the plans he divulged yesterday on “The Claman Countdown”, here’s more from our Fox News story referenced previously:

But Paulson has said that market timing and investor timing will really matter depending on who is president, and Claman asked him if he is ready to take that chance.

“It depends on the policy,” Paulson said. “I think if Harris was elected, I would pull my money from the market. I’d go into cash, and I’d go into gold because I think the uncertainty regarding the plans they outlined would create a lot of uncertainty in the markets and likely lower markets.”

Here’s the thing about hedge funds — they can take a beating.  They are designed to weather storms.  This is a billionaire hedge fund manager… saying if Kamala Harris wins the election, he’s done.  If he’s right, and his hedge fund can’t stand the uncertainty injected by a Kamala presidency, who can?  The answer is not many, if any; hence the expected sell-off.

And then… there’s this:

JP Morgan CEO Jamie Dimon warns that stagflation, a crisis worse than a recession, remains a real possibility for the U.S. economy 🚨 pic.twitter.com/2OSioek1il

— Barchart (@Barchart) September 14, 2024

So… what will happen if Kamala wins?  According to one of the most successful hedge fund managers on the planet, huge sell-offs.  And what are his plans?  Abandon ship.  Cash and gold will become safe havens from uncertain market volatility.

And I hate to surprise you with more bad news, but even without a Kamala win we are apparently in danger of something WORSE than our current inflationary problems: stagflation.  Here’s a quick look at a current story running in The Daily Mail for info on that worry:

Paulson then said market timing and investor timing would make the difference in the markets if Harris were elected.

But still, he said, he is not willing to take the chance and would sell off his stocks.

His remarks come just days after JPMorgan Chase CEO Jamie Dimon said he would not rule out an outcome for the US economy which is widely considered to be worse than a recession.

The chief executive of the country’s biggest bank said this week ‘the worst income is stagflation,’ which he would not ‘take off the table.’

Economists widely consider stagflation, last seen in the US in the 1970s, to be worse than a recession. It would send stocks down, hitting 401(K)s and other retirement savings.

Stagflation is the combination of economic stag-nation and in-flation. Prices continue to soar at the same time as unemployment rises and economic growth slows – a triple whammy of problems.

In a recession, unemployment increases and the economy shrinks – but the silver lining is that there is little or no inflation.

Dimon says he worries that there are still a raft of inflationary forces on the horizon, and pointed out that higher deficits and increased government spending will add pressure to an economy still reeling from the impact of sustained higher interest rates.

We may have a price to pay yet for the failed Biden-Harris policies, even if “we the people” successfully put President Trump back in the White House.  Regardless, there is no doubt judging from what happened under his first term, that the markets like President Trump and his policies.  There may be localized shake-ups in the market every once in awhile because of “mean tweets” er- “mean posts”?  But localized volatility is a lot different than the inherent uncertainty of a Harris economy.

For the sake of every American, not just the billionaires, who have money they would rather not lose, and hopes of making more — let’s hope that what we are seeing now is the closest we ever get to seeing an actual Harris economy.