Currencies will be 'turned into confetti' if policymakers refuse to call time on quantitative easing (QE), Bruce Stout, Murray International's global equities ace, has warned.
Having navigated a challenging 12 months to steer his trust to a 14% net asset value (NAV) total return, Aberdeen Asset Management's Stout has said central bankers' reliance on QE is 'frightening'.
'Without doubt, the process of quantitative easing, or printing money in straight-talking vernacular, has dominated the economic landscape over the past 12 months,' he pointed out, adding that continued stimulus would only serve to turn developed 'currencies into confetti'.
Stout explained: 'History dictates currency debasement is always the end result for persistent printing of money because all respect, integrity and trust in the paper it is written on is eventually lost.'
'Such economic vandalism must stop, and soon, if credibility is to be restored to Western financial systems,' Stout added.
I'm no bear
To many, the global equities star has been bearish for a number of years, having warned in 2010 that investors faced a 'lost decade' of marginal growth.
But the manager, who over the last three years has returned 38% versus 27% by his typical peer, said rather than labelling his global outlook as pessimistic, it should be taken as fact.
Stout said: 'We have not had growth for five years, that's not a negative statement, it's fact. Why it's happened is because we have gone on a debt binge. Again, that's not negative,' it's fact.'
Against this backdop, Stout told Wealth Manager he is seeing few good quality companies trading at attractive valuations.
He has, however, been able to add two new names to his £1.3 billion portfolio in recent months.
Since January Stout has built up positions of around 1.5% of his trust's assets in Coca-Cola Amatil and Verizon, a leading US based telecommunications company.