Episodios
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This week we discuss the Fed decision & economic projections, the bullish market signals, and the reasoning behind recession calls. We also delve into the trajectory of the economy and cutting cycle, private credit markets, the banana zone, and much more. Enjoy!
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Weekly Roundup Charts: https://drive.google.com/file/d/195AL7oEaAkimijE0XSnagP8vwzeDat4N/view?usp=drive_link
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Join us at Permissionless III Oct 9-11. Use code: FG10 for a 10% discount: https://blockworks.co/event/permissionless-iii
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Timestamps:
(00:00) Introduction
(01:14) FOMC Victory Lap
(03:38) Quinn's Framework
(06:11) Bullish Rate Cut?
(09:30) Summary of Economic Projections
(14:32) Bullish Market Signals
(18:05) The World Trade
(21:09) Trajectory of the Cutting Cycle
(24:30) Market Sentiment & Credit Risk
(27:50) Private Credit
(29:55) Sovereign Debt Crowding Out Private Debt
(31:43) Permissionless Ad
(32:23) Fiscal Super Cycle
(34:09) Energy, Commodities, & AI
(37:13) Economic Expectations
(39:50) Reconciling Recession Calls
(44:35) The Market Gives Something for Everyone
(50:38) Oil Market & Liquidity
(53:32) The Banana Zone
(58:58) Monetary Matters
(01:01:09) Balancing Market Views
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets. -
This week we discuss the Federal Reserve’s upcoming interest rate decision, the path to the neutral rate, and why the Fed should front-load its rate cuts. Darius and Felix also delve into why the recessionistas are wrong about the labor market, the fiscal impulse, the impact of the BOJ and China on global macro, and much more. Enjoy!
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Join us at Permissionless III Oct 9-11. Use code: FG10 for a 10% discount: https://blockworks.co/event/permissionless-iii
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Timestamps:
(00:00) Introduction
(00:41) Overview of the Economy
(02:42) Recession vs Normalization
(05:48) 25 vs 50 Bps Rate Cut
(10:17) Are We Price For Recession?
(12:50) Inflation & Front-Loading Rate Cuts
(19:43) The Recessionistas Are Wrong
(25:49) The Fiscal Impulse
(28:55) Trend of US Growth
(31:02) Permissionless Ad
(31:42) The Bank of Japan & Interest Rate Differentials
(40:31) Chinese Economy
(44:32) Asset Allocation
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets -
¿Faltan episodios?
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Important news: this will be Jack’s last episode as the host of Forward Guidance. He is transitioning to host a new podcast called Monetary Matters: https://www.youtube.com/@Monetary-Matters
Felix Jauvin, macro trader and current host of “On The Margin,” will be the new host of Forward Guidance going forward: https://x.com/fejau_inc
Richard Koo, senior adviser at CSIS, chief economist at Nomura Research Institute, and pioneer of the “balance sheet recession” phenomenon, explains why he thinks China’s balance sheet recession has already begun.
Richard Koo’s latest book, “Pursued Economy: Understanding and Overcoming the Challenging New Realities for Advanced Economies”: https://www.amazon.com/Pursued-Economy-Understanding-Overcoming-Challenging/dp/1119984270
Richard Koo’s classic book, “The Holy Grail of Macroeconomics: Lessons from Japan's Great Recession”: https://www.amazon.com/Holy-Grail-Macroeconomics-Lessons-Recession/dp/0470824948
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Timestamps:
(00:00) Introduction
(01:08) What Is A Balance Sheet Recession?
(08:56) Balance Sheet Recession In Europe & U.S. After The Great Financial Crisis of 2008
(15:46) China's Balance Sheet Recession
(25:43) Savings And Bank Credit In China
(33:26) Permissionless Ad
(34:25) China's Trade Surplus
(38:20) China Likely Can't Export Its Way Out Of Its Balance Sheet Recession Because The Rest of the World Won't Let It
(45:33) The Currency Adjustment Mechanism To Correct Trade Imbalances Has Been Severely Impaired, Argues Koo
(01:01:58) Is The U.S. in a Balance Sheet Expansion?
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets. -
This interview with Brett Jefferson discusses trust preferred CDOs, why they can provide such great opportunities, and how Brett’s fund capitalizes on this niche market. Brett and Jack also discuss the private credit market, the risks and benefits of securitization, the performance of the collateralized loan market, and much more. Recorded on September 10, 2024.
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Jack’s upcoming podcast, Monetary Matters: https://www.youtube.com/@Monetary-Matters
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Timestamps:
(00:00) Introduction
(00:59) Trust Preferred CDOs
(08:44) Starting Hildene Capital Management
(10:44) Buying Trust Preferred CDOs
(13:22) Deferred Payments
(20:13) Trust Preferreds Regulated Out
(23:15) Philadelphia Fed Paper
(27:38) Taking Advantage Of Inefficient Markets
(34:33) Private Credit
(37:55) Hildene's Market Niche
(44:11) The Structured Credit Market
(51:44) Structured Security Correlations
(55:20) Credit Market Risks
(01:00:00) The Realities Of Private Credit
(01:08:27) TruPS CDOs
(01:11:03) Private Credit CLO Market
(01:14:48) Risks & Rewards
(01:18:58) Collateralized Loan Market Performance
(01:25:28) Closing
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets. -
Laila Kollmorgen, Portfolio Manager, CLO Tranche for Pinebridge Investments, joins Jack for a Fireside Chat on Forward Guidance to discuss why collateralized loan obligations (CLOs) have rallied so much over the past two years as most of the fixed-income world has suffered enormously. Laila explains why she likes the structure of CLOs and why she thinks there will be an opportunity to be selective going forward as credit fundamentals begin to soften and valuations have increased. This interview is a Fireside Chat and paid sponsorship on behalf of the VanEck Associates Corporation.
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Laila Kollmorgen’s articles on Pinebridge:
https://www.pinebridge.com/en/insights/after-the-clo-rally-selectivity-will-be-key-as-fundamentals-shift
https://www.pinebridge.com/en/insights/after-the-clo-rally-selectivity-will-be-key-as-fundamentals-shift
https://www.pinebridge.com/en/insights/leveraged-finance-asset-allocation-insights-issuer-selection-is-key-as-loans
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Timestamps:
(00:00) Introduction
(01:15) What Is A Collateralized Loan Obligation (CLO)?
(05:37) CLOs (Collateralized Loan Obligations) vs. CDOs (Collateralized Debt Obligations): How CLOs Fared Much Better Than CDOs During The Great Financial Crisis
(13:13) Market Value CDOs and CLO Reinvestment Periods
(19:45) Why CLOs Have Performed So Well
(24:54) If Silicon Valley Bank Had Invested In CLOs Instead of Long-Duration Paper (Agency MBS & Treasurys), Perhaps They Would Still Be Around!
(35:26) CLO Valuations And Laila's Base Case For CLOs As Interest Rate Cutting Cycle Is About To Begin
(41:21) Have Economic Fundamentals Begun To Soften?
(43:37) Refinancing Risk (i.e. if CLO Manager Pays Off Tranche Liabilities At Par To Refinance At Tighter Spread)
(46:32) Some CLO Investors Were Buying Callable Paper Above Part (>100)! (That's "Crazy" Says Kollmorgen)
(51:59) The Maturity Wall For High Yield and Corporate Credit Has Been Extended
(56:13) How Might Various Tranches Of CLO Asset Class Perform In A Recession?
(59:41) Risk of Default and Risk of Distressed Sales
(01:03:53) Views On Liquidity and Volatility
(01:09:04) Not A Huge Fan of Private Credit CLOs
(01:13:37) Thoughts on "Creditor on Creditor Violence"
(01:17:10) Red Flags to Avoid In CLO World
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor befor -
This interview with Matthew Sigel explores the bull case for bitcoin, its future as a reserve asset, and the economics of bitcoin miners. We also discuss miners pivoting to data centers, stablecoins, crypto regulation and much more. This interview is paid sponsorship on behalf of the VanEck corporation. Recorded on September 4, 2024.
Sigel's piece, "Bitcoin Miners' AI Arbitrage Play to Boost Revenue": https://www.vaneck.com/us/en/blogs/digital-assets/matthew-sigel-bitcoin-miners-ai-arbitrage-play-to-boost-revenue/
Sigel's piece, "Bitcoin 2050 Valuation Scenarios: Global Medium of Exchange and Reserve Asset": https://www.vaneck.com/us/en/blogs/digital-assets/matthew-sigel-bitcoin-2050-valuation-scenarios-global-medium-of-exchange-and-reserve-asset/
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Timestamps:
(00:00) Introduction
(00:53) How Matthew Got Into Crypto
(05:10) Fake & Bias News In Finance
(07:51) The Case For Bitcoin
(10:48) Bitcoin As A Reserve Asset
(18:33) Nation States Leveraging Bitcoin
(22:40) Profitability Of Bitcoin Mining
(24:22) Catalysts For Bitcoin Adoption
(26:52) Bitcoin As A Medium Of Exchange
(28:42) Bitcoin Risks
(33:34) Is The Bitcoin Supply Flexible?
(35:08) Bitcoin Miner Economics
(41:02) Bitcoin Miners Repurposing Their Energy
(46:31) Bitcoin Vs Altcoins
(53:53) Biggest Crypto Overweights & Underweights
(58:09) Stablecoins
(01:05:19) Crypto Politics & Regulation
(01:07:40) NFTs
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets -
Imaru Casanova, Portfolio Manager, Gold and Precious Metals at VanEck, joins to share her views on how to value gold stocks such as gold miners and gold royalty companies. Casanova argues that with the recent run up in gold, gold stocks could be undervalued and are poised to deliver strong results and returns. This interview is a Fireside Chat and paid sponsorship on behalf of the VanEck Associates Corporation.
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Imaru Casanova on VanEck website: https://www.vaneck.com.au/news-and-insights/thought-leaders/imaru-casanova/
Casanova’s latest piece on Gold Miners: https://www.vaneck.com/us/en/blogs/gold-investing/ima-casanova-miners-margins-grow-as-gold-soars-to-fresh-highs/
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Timestamps:
(00:00) Introduction
(00:24) The New Bull Market In Gold
(06:32) Investing In Gold Companies
(09:14) How To Value A Gold Company
(16:38) Cash Flow vs. Earnings?
(19:25) Gold Miners Are ~20% Discounted Relative To Gold Prices
(22:51) Specific Gold Mining Stocks
(25:36) Managing Jurisdictional Risk
(36:54) Thinking About Depreciation
(40:04) Common Mistakes When Analyzing Gold Companies
(44:38) Gold Royalty Companies
(52:06) Greenfield vs. Brownfield Projects
(58:32) Closing Thoughts on Gold Miners
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets. -
This interview with Jonny Mathews explores why he believes we aren’t headed for a recession, how real consumption will likely drive Q3 GDP higher, and why he thinks unemployment will moderate. We also discuss the market opportunities he’s seeing, hitting home run trades, and much more.
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Timestamps:
(00:00) Introduction
(00:45) Are We Headed For A Recession?
(03:09) Income Growth Is Driving Consumption
(05:45) Household Savings
(07:44) Unemployment Will Moderate
(15:40) Credit Markets
(19:48) Permissionless Ad
(20:48) Job Market Revisions
(23:47) Opportunities In Fixed Income
(27:32) Trading Interest Rates
(30:53) Will Inflation Continue To Fall?
(35:42) Labor Market Data
(39:31) Opportunities In The UK
(50:30) Home Run Trades
(52:55) The Gold Market
(55:33) China Outlook
(01:01:24) S&P 500 Earnings
(01:05:29) AI & Productivity
(01:09:29) Super Macro Note
(01:12:05) Jonny's Trading Experience
(01:18:13) Stocks Over Bonds
(01:20:27) Cumulative Personal Savings
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets -
This interview was recorded on a drive down from Leen’s Lodge in rural Maine, as Talmon and Jack returned from “Camp Kotok,” the renowned retreat for prominent economists, wealth managers, traders, heads of research, and financial journalists. Talmon and Jack talk about the cooling labor market, modern monetary theory (MMT), private credit, and more.
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Latest articles by Talmon Smith for The New York Times: https://www.nytimes.com/by/talmon-joseph-smith
About Camp Kotok https://www.cumber.com/about/camp-kotok
Leen’s Lodge: https://leenslodge.com/
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Timestamps:
(00:00) Introduction
(00:33) The Soft Landing Is In View
(08:28) Companies Actually Do Pay Attention To Interest Rates When Hiring, Believe It Or Not
(17:26) Jack & Tal Rant About The Virtues Of A Flexible Centralized Currency
(18:53) Permissionless Ad
(19:51) Interview Continues
(26:42) The Sahm Rule Was Created To Inspire Action In Order to Prove Itself Wrong
(37:00) Outside of Banking Crisis of 2023, The Fed's "Pain" Has Yet To Show Itself
(42:37) The Treasury Market: How Much Does Supply Affect Yields?
(49:48) Modern Monetary Theory: Who Really Prints The Money?
(01:27:10) Jack's Personal Thoughts On Private Credit
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets. -
This interview with Angus Shillington explores why India is the most promising emerging market, why it has outperformed the S&P 500, and the country’s favorable demographics. We also discuss the risks & rewards of investing in China, how Chinese equities compare to Indian equities, and the booming semiconductor market. This interview is paid sponsorship on behalf of the VanEck corporation. Recorded on August 22, 2024.
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Timestamps:
(00:00) Introduction
(00:18) Emerging Vs Developed Market Investing
(01:19) GDP Vs Equity Performance
(06:16) Risks & Rewards In Chinese Equities
(10:14) Chinese Real Estate Market
(11:54) Most Promising Emerging Market
(18:28) How India's Market Improved
(22:57) How India Companies Fund Themselves
(24:29) India's Favorable Demographics
(30:01) Best Performing Industries In India
(33:09) India Inflation
(35:31) India's Imports & Exports
(36:50) Indian Vs Chinese Equity Valuations
(45:58) Indian Investment Goals
(49:00) Indian Vs Chinese Financial Sector
(53:54) TSMC, NVIDIA, & The Semiconductor Market
(01:10:01) Does ASML Have A Monopoly
(01:12:26) Most & Least Favorable EMs
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets -
This interview with Jim Bianco and Jeremy Schwartz discusses the Federal Reserve’s policy path, whether inflation will actually come down, and if the economy is headed for a no landing. We also delve into the neutral rate, the key election issues for markets, and whether stocks will outperform bonds.
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Timestamps:
(00:00) Introduction
(00:48) Jim & Jack's Assessment Of The Economy
(02:58) The Fed & Interest Rates
(03:55) Unemployment & The Sahm Rule
(06:57) Is Inflation Coming Down?
(08:33) Real Interest Rates
(11:05) What Is The Neutral Rate?
(14:21) The Pace Of The Cutting Cycle
(18:41) Election Insights
(20:55) Deficits Are The Key Issue
(23:11) Will Stocks Outperform Bonds?
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets -
This interview with Michael Drury explores how China’s problems affect the global economy, its economic advantages, and where it spends its trillion-dollar surplus. We also discuss the US economy’s resilience, why Michael doesn’t see a recession, and much more.
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Timestamps:
(00:00) Introduction
(00:31) The Risks Of Financialization
(02:07) Financial Market Signals
(05:37) China & The Global Economy
(09:44) China's Problems Are The World's Problem
(15:15) US Economic Resilience
(21:07) How Good Is The US Economy?
(27:11) Fed Vs Wall St. Priorities
(30:28) Comparing Major Economies
(37:18) China's Economic Advantages
(40:44) Where China Spends Its Money
(49:44) China's Growing Influence
(53:01) The US Economy & Inflation
(01:10:31) European Economy
(01:11:58) Asian Economies
(01:14:48) Camp Kotok
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets -
This interview with Eric Fine & Natalia Gurushina delves into the potential of emerging markets, how they are affected by developed market weakness, and contrasting central bank strategies. We also discuss investing in China, emerging market reserve strategies, and de-dollarization. This interview is paid sponsorship on behalf of the VanEck corporation. Recorded on August 7, 2024.
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Timestamps:
(00:00) Introduction
(00:40) How Eric Got Interested In Emerging Markets
(03:38) Natalia's Introduction To Economics
(05:55) How Big Is The EM Bond Market?
(11:07) Why EM Bonds Have Outperformed
(14:40) Weakness From Developed Markets
(17:35) The Yen's Impact On EMs
(26:24) BOJ Vs Brazilian Central Bank
(29:16) Mexico's Fiscal Orthodoxy
(30:58) Benefits Of Floating Currencies
(34:32) Making Money In EM FX
(36:53) Signal For EMs To Cut Rates
(38:38) Role Of Hedge Funds In EM FX
(41:25) Diversification In EMs
(46:24) Sub-Saharan Africa
(51:48) Importance Of India
(59:40) Investing In China
(01:04:49) China's Growth Model
(01:17:10) Emerging Market Reserves
(01:25:01) De-Dollarization
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets -
This interview with Mike Harris explores the strategies and challenges of the Quest Hedge Fund, from CTA trend-following and AI trading models to the overcrowded quant equity space. We also dive into statistical arbitrage, multi-strat funds, the macro outlook, and the advantages & risks of using AI.
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Timestamps:
(00:00) Introduction
(00:20) Mike Harris Background As a Quant
(03:07) Quest Hedge Fund
(04:30) CTA Trend Following Strategy
(11:50) Trend Following Examples
(16:47) Permissionless Ad
(17:44) Interview Continues
(19:33) Quant Equity Trading Getting Crowded
(22:52) Statistical Arbitrage
(27:17) Risks to Statistical Arbitrage
(32:11) Multi-Strat Hedge Funds
(33:32) Lack of New Fund Launches
(39:04) Sharpe Ratio In Strategies
(41:34) Private Market Investing
(48:29) Volatility Strategies
(54:17) Macro And Stock Market Outlook
(01:02:26) Risks To Quest
(01:06:02) Risks To Training Models With AI
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets -
Forward Guidance is sponsored by VanEck. Learn more about the VanEck Morningstar Wide MOAT ETF (MOAT) at https://vaneck.com/MOATFG.
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This interview with George Robertson and Mel Mattison explores why deficit spending will send stocks and risky assets higher. We also discuss the true risk-free rate and the Federal Reserve’s control over the Treasury Market, nominal GDP’s relationship to interest rates, and stock market valuations that could lead to a collapse in 2027.
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Timestamps:
00:00 Introduction
01:26 Why George Robertson Is Bullish
04:12 Are Fiscal Deficits Juicing the Economy?
05:43 Impact Of Passive Fund Flows On The Market
09:33 Unemployment And The Labor Market
13:22 Government Spending And The Economy
20:16 GDP Is Booming
21:13 VanEck Ad
26:40 The Fed Is Looking For A Reason To Cut Rates
30:47 Are Higher Rates Stimulating The Economy?
35:46 Nominal GDP And Interest Rates
52:18 How The Fed Controls The Yield Curve
56:47 Rates Are Artificially Low
01:18:05 How The Fed Manipulates Treasury Rates
01:29:15 Market Distortions Pushing Risk Assets Higher
01:34:09 Stock Market Boom, Earnings & Valuations
01:59:54 Market Bubble Will Eventually Collapse
02:03:26 Reforming Entitlement Spending
02:08:36 The US Will Solve All Problems
02:15:34 The Ticking Time Bomb Of US Debt
02:24:07 How The 2024 Election Impacts The Economy
02:30:26 Learn More About George And Mel's Work
02:32:15 Thoughts On Small Caps
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets. -
Forward Guidance is sponsored by VanEck. Learn more about the VanEck Morningstar Wide MOAT ETF (MOAT) at https://vaneck.com/MOATFG.
This interview was recorded on Friday, August 2, during Friday's sell-off but before the vicious sell-off on Monday. he did talk about the potential for an unwind of the yen carry trade before the crash in Japanese equities and the yen carry trade was widely blamed for Monday's steep decline. But Brent doesn't really care about being "right" he is an investor first and foremost. On that point, I think people perceive that a majority of his portfolio is based on the surging of the U.S. dollar but as he says it's a very small percentage and he recommends using this "cheap hedge" (for example buying calls on USDHKD) as a way to comfortably go long risk assets. He is also (and has been) a bull on gold and he remains *not* a bull on Treasurys (which he thinks some incorrectly think he is).
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Timestamps:
(00:00) Introduction
(01:34) Brent's Market Views
(06:56) Brent's Dollar View
(13:44) VanEck Ad
(14:26) Interview Continues
(17:57) Potential For A "Fiscal Doom Loop"
(19:41) People Have Been Calling For The End Of The Dollar For Longer Than Most People Have Been Alive, And It Hasn't Happened. Brent Is Betting That Those People Will Continue To Be Wrong For At Least A Little While Longer
(20:20) People Have Been Calling For The End Of The Dollar For Longer Than Most People Have Been Alive, And It Hasn't Happened. Brent Is Betting That Those People Will Continue To Be Wrong For At Least A Little While Longer
(26:07) Hedging For The Dollar Milkshake In A Responsible, Risk-Defined Way
(36:46) Permissionless Ad
(37:53) Connection Between Dollar and U.S. Stock Market
(43:19) Potential For A Global Dollar Squeeze
(48:37) Why The Rest of The World Suffers From A Stronger Dollar
(01:02:00) Would Trump And Vance Ticket Succeed In Weakening The U.S. Dollar To Promote Exports?
(01:04:51) Michael Pettis' Frameworks That U.S. Fiscal Deficit Is Large Because U.S. Trade Deficit Is Large
(01:13:03) Does Weaponization of The U.S. Dollar Force De-Dollarization?
(01:16:17) Brent's Views On Economy And Stock Market: He Doesn't Think U.S. Is Headed For A Recession
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets. -
Forward Guidance is sponsored by VanEck. Learn more about the VanEck Morningstar Wide MOAT ETF (MOAT) at https://vaneck.com/MOATFG.
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets -
Forward Guidance is sponsored by VanEck. Learn more about the VanEck Morningstar Wide MOAT ETF (MOAT) at https://vaneck.com/MOATFG.
This interview was recorded at 10am ET on Friday, August 2. The jobs report, which was released 90 minutes prior at 8:30am ET, showed the unemployment rate move non-linearly up from 4.1% to 4.3%, and the stock market fell sharply and short-term interest rate futures market priced in a high likelihood of the Federal Reserve doing a DOUBLE (50 bps) cut by its September meeting. The Fed Funds pricing changed throughout our interview and Jack references that in the conversation.
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YouTube video on Canadian market bubble and Nortel Networks: https://www.youtube.com/watch?v=I6xwMIUPHss&t=2219s&ab_channel=BobbyBroccoli
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Timestamps:
(00:00) Introduction
(00:13) Stock Market Pukes In Reaction To Horrible Jobs Report
(05:45) Is The U.S. In A Recession Now?
(06:01) How Passive Investing Has Driven The Stock Market Higher
(28:35) VanEck Ad
(29:15) Passive Flows In The Context Of Other Market Forces
(32:25) Has Passive Investing Boosted Valuations of The Biggest Companies?
(42:25) Will The Same Passive Forces That Boosted The Market Higher Work In Reverse Now That The Market Is Declining?
(48:40) Permissionless Ad
(49:39) If Passive Is A Bubble, It Can Get A Whole Lot Bigger
(53:16) SPAC Flows Are No More
(01:16:52) Soros-like Reflexivity of High Stock Prices
(01:18:49) Mike's Views On Ongoing "Market Hiccup"
(01:34:00) Mike's Closing Thoughts on Private Credit
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets. -
Forward Guidance is sponsored by VanEck. Learn more about the VanEck Morningstar Wide MOAT ETF (MOAT) at https://vaneck.com/MOATFG.
Follow Nick Timiraos on Twitter https://x.com/NickTimiraos
Nick’s work at WSJ: https://www.wsj.com/news/author/nick-timiraos
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Nick’s book https://www.amazon.com/Trillion-Dollar-Triage-President-Pandemic/dp/0316272817
Nick’s article on Fed and 2024 election: https://www.wsj.com/economy/central-banking/fed-interest-rate-cut-inflation-politics-a6e527de
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Timestamps:
(00:00) Introduction
(12:35) VanEck Ad
(13:14) Interview Continues
(19:35) What Would It Take For The Fed To NOT Cut In September?
(24:17) Is The Federal Reserve Worried About A Weakening Labor Market?
(25:44) Immigration's Impact On U.S. Labor Market
(31:41) The Housing Market
(36:41) Permissionless Ad
(37:40) Politics And The Fed: "September Rate Cut Would Thrust Fed Into Brutal Election Campaign"
(47:24) It's Simply A Fact: Former President Donald Trump Likes Low Interest Rates
(50:37) Could Donald Trump Fire Fed Chair Jay Powell If Re-Elected President?
(54:49) Economic Forecasting Is Very Difficult, And There Is Always A Point of Data That Confirms One View Or Another
(57:47) What If High Interest Rates Are Actually Stimulative? Nick Doesn't Buy It (And Neither Does The Fed)
(01:02:44) The Way The Fed Thinks About Financial Conditions
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets. -
Forward Guidance is sponsored by VanEck. Learn more about the VanEck Morningstar Wide MOAT ETF (MOAT) at https://vaneck.com/MOATFG.
Follow VanEck on Twitter https://x.com/vaneck_us
Follow Jack Farley on Twitter https://twitter.com/JackFarley96
Follow Forward Guidance on Twitter https://twitter.com/ForwardGuidance
Follow Blockworks on Twitter https://twitter.com/Blockworks_
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Timestamps:
(00:00) Introduction
(01:36) The High-Yield Bond Market
(10:08) VanEck Ad
(10:48) Putting Money To Work When Credit Is Priced Optimistically
(19:27) The Bank Loan Market (i.e. Leveraged Loans)
(25:04) How Are Loan Borrowers Handling 500 Basis Points Of Increased Debt Costs?
(28:59) Permissionless Ad
(29:58) The Rise of Private Credit: Are We In The Golden Age?
(41:34) Is Private Credit An Untested Asset Class In A Potential Recession?
(46:53) What Is The Private Credit Money Used For?
(52:57) Why Do Active Managers Manage To Outperform The Index In Credit, When In Equities So Many Underperform?
(58:51) Loan Refinancings Are Occurring At A Record Pace
(01:03:02) Structured Credit And Non-Agency RMBS (Residential Mortgage-Backed Securities)
(01:04:40) Specialty Retail and Emerging Markets
(01:07:02) Commercial Real Estate (CRE)
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets. - Mostrar más
