Palisade Capital Management co-chairman and CIO Dan Veru believes that the Federal Reserve is done raising rates and that the end of the rate cycle is near.
Veru thinks that while other economies will continue to raise rates, the US economy will put downward pressure on the dollar and pressure on commodities like gold.
He is unsure when cuts will come, but he thinks that Jay Powell will lead the way.
Veru attended the Milken Institute, where he heard a recurring theme of keeping interest rates higher for longer.
Veru’s strategy involves buying companies that do not need banks to grow or sustain their business.
He and his partner, Will Potter, focus on concentrated holdings with compounded returns, finding companies with high returns on equity and invested capital, high free cash flow, and a long track record of capital deployment.
They try to avoid stocks that rely on loans and debt due to the rising cost of capital.
