The billionaire of hedge funds Paul Tudor Jones says that 2025 is “so much more potentially explosive than 1999” because of the way the bull markets always end

Speaking to Andrew Ross Sorkin of The New York Times‘Dealbook on CNBC Squawk box Before the next Robin Hood Foundation investors conference, Jones described today’s investment climate as strangely similar to the one preceding the Bust Dot-Com 2000.

“It looks exactly like 1999,” he said, which implies that the market was acting as the famous prince’s song with the lyrics: “Party like it’s 1999.” He urged investors to position themselves as October 1999, when the Nasdaq doubled in a few months before collapse, a model that Jones considers more and more plausible today. The difference is that it could be even worse than the bust dot-com, he said.

Jones told Sorkin that his concerns had to do with the behavior of investors in each bull market, especially at the end, when the cliff is approaching and no one knows where he is.

The jostling

Jones underlined that in each bull market, the “greater price appreciation is always the 12 months preceding the summit”, as what happened after October 1999. For investors, he said, the challenge is the time: “If you do not play it, you will miss the juice. On tiptoe around the quarter, rather than standing.

“If anything, is now much more potentially explosive than 1999,” said Tudor Jones, quoting the backdrop of interest rate reduction in the federal reserve. He noted that the Fed is implemented for several rate drops, monetary policy bringing the economy to a real interest rate from zero, which means incentives to invest and spend with such a low cost of capital. In terms of fiscal policy, the congress experienced a budgetary surplus in 1999 and today has a budget deficit of 6%. “This fiscal / monetary combination is an infusion that we have not seen since, I suppose that the post-war period, the early 1950s, something like that,” he said. “And they were crazy moments, right? Leaving war.”

However, Jones insisted that he did not call a bubble or did not predict an accident.

“I don’t suggest that the train will crash,” he said. “I suggest that we are in a period conducive to a massive price appreciation in a variety of assets.”

The daring “go” era: tax recklessness and IA

Where Jones saw a bubble was in sovereign debt, labeling the government obligations the “greatest bubble”, with massive global deficits stretched, for the moment, by a cycle of continuous relaxation and early flows in fixed income.

“We are a little boldly where no man has gone before,” he said, taking a Star Trek Reference to capture the unprecedented mixture of easy money and sovereign balloon bonds. It provides for a calculation when the current rate of rate drops ends and “this whole request was pushed to the front”.

When asked for the “circularity” of funding in the AI ​​space, with Nvidia, Openai, AMD, Oracle, (Hotlink) Microsoft, (/ Hotlink) and others all having chords of data centers somewhat intertwined with each other, Jones accepted. “Circularity makes me nervous, I would say.” But he added that in general terms, the way he thinks about it is that the markets are mainly concerned about inflation, and gold is a large winner (precious metal has in fact constantly established record heights in 2025, almost $ 4,000 per Monday). Jones did not mention the company NVIDIA throughout its interview.

Jones also zooms in for a minute to talk about the race for the fourth quarter.

“The race, realistically, is certainly until the end of the year, because it is at this time that everyone is institutionally marked, then you have to understand what will happen next year,” he said.

These remarks echoed a separate interview given to Fortune By the main analyst of Bank of America Research, Vivek Arya.

“I think we are at this time of the year and it is not only specific to (2025), as we have seen in previous years at this time when people rightly become very nervous about what will be the quantity of spending next year,” said Arya.

From the start of the new year, Arya added: “People are comfortable with expenses, then it starts going back to the fundamentals.” He added that there is a “peculiarity” on the fourth quarter season “where people become naturally nervous”. Fortune Reported separately the thesis of “panic season” and “harvest time” by Owen Lamont, namely that the markets are suffering from too many traders on vacation between August and October, a heritage that dates back to the American agricultural roots and how the markets worked around the harvest of certain cultures.

For the moment, Jones has told CNBC, music is still playing. But the warning is clear: “History rhymes a lot”. For investors, 2025 could be a year defined by explosive gains – and the risk that the end of the party will arrive earlier, and more violently, that most expect. He added that he is not certain that 1999 was fully replaced: “But I think that all the ingredients are in place, and certainly from a commercial point of view … He looks like a duck and a charlatan like a duck. It’s probably not a chicken, right? ”

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