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Howard Marks, co-chairman of Oaktree Capital Group
Billionaire investor Howard Marks said he’s worried about an increasing sentiment taking hold in American politics.
“There is a rising tide of anti-capitalism and we should be concerned about that,” the co-chairman of Oaktree Capital said on CNBC’s “Fast Money: Halftime Report” on Thursday.
“We have a machine in this country that makes it successful — based on Democracy, our freedoms and also I think the economy and the way it operates in a free-market mode.”
Marks addressed the issue in his latest memo to clients. He’s known for his prophetic notes, which have warned about the 2008 financial crisis and the dotcom bubble of the late 1990s. He’s now predicting the far-left wing of the Democratic Party will “show up strongly” in the 2020 primaries.
He called out the “increasing anti-capitalist sentiment” and specifically took issue with New York Rep. Alexandria Ocasio-Cortez’s proposal targeting the wealthy with a 70 percent marginal tax rate on income above $10 million. “Americans generally accept the concept of progressive tax rates. But they must not be punitive and demotivating,” he wrote.
Marks told CNBC he understands that income inequality has expanded and that something should be done about it. “The cost of capitalism is that there are some people who succeed a lot and some people who don’t succeed. And that’s undesirable,” he said. “We should have as safety net for them. But I still think we shouldn’t throw out the system.”
Oaktree Capital had $124 billion of assets under management as of September. Marks has a net worth of $2 billion, according to Forbes.
— CNBC’s Tae Kim contributed to this report.