OAK - Howard Marks says V-shape sounds 'too positive' asset returns fair

Oaktree Capital Group's (OAK) billionaire co-chairman, Howard Marks points to need to be realistic about the economy, the need for further fiscal stimulus and says adequate returns may be hard to come by in his latest memo.Companies and state and local governments still need funds, but “partisan enmity is at a level I’ve never seen before”, Marks writes.What happens if “Washington fails to deliver sufficient additional assistance, widespread layoffs ensue (as seems to be beginning) and business slows again? Mightn’t we see a rise in defaults and bankruptcies and a softening of investor psychology and thus asset prices?”For individuals the foreclosure rate is likely to spike when the moratorium runs out this year, when a reported “several million” will have gone nine months without making a mortgage payment, noting already “17% of FHA-insured mortgages were delinquent in July”.But even with more economic stimulus, the impact of COVID-19 won’t be easily

For further details see:

Howard Marks says V-shape sounds 'too positive', asset returns fair