Real Vision managing editor Ed Harrison is joined by editor Jack Farley to evaluate the value rotation trade and the challenges it will face in the coming months. As November comes to a close – a month that saw record-breaking appreciation in value stocks, cyclicals, and small-caps – Ed and Jack analyzes how rising COVID-19 hospitalizations will impact economic behavior. They then look at liquidity going forward, and how monetary conditions will affect markets over the next few months, incorporating Ed’s interview with Michael Howell and Jack’s upcoming interview with Teddy Vallee. Ed and Jack close by discussing the Government Accountability Office’s report on incorrect jobless claims data, as well as GM’s partial back-pedaling out of its deal with controversial electric vehicle manufacturer Nikola.
Jeremy Grantham's Big Calls: Emerging Markets, Venture Capital, and the Green Revolution
Long-term investment strategist and co-founder of GMO Jeremy Grantham has made a name for himself as a bubble spotter. In this interview with Mike Green of Logica Capital Advisors, Grantham argues that although we are again in a market bubble, it has an entirely different make up than prior bubbles and is almost devoid of the opportunity that these periods of misallocation historically provide. As a result, he sees opportunities as few and far between in public markets. With the exception of emerging markets and the greening of the economy, an endeavor that he believes is a societal necessity, he encourages investors to look towards venture. Together, Grantham and Green also debate China's position in Grantham's emerging market thesis and the green revolution, the pollution paradoxes of greening the economy, and the merits of societies and forms government that incentivize cooperation among people and risk taking in the form of early stage venture capital. Filmed on November 18, 2020.
Lyn Alden of Lyn Alden Investment Strategy, joins Travis Kling founder of Ikigai Asset Management, to discuss the current macro climate and the various forces contributing to deflationary and inflationary pressures. Alden explains the ramifications of these pressures on stores of value, such as Bitcoin. She touches on the potential "Japanification" of the United States, debt cycles and the Bitcoin Halving. Alden explains that US politics will have the greatest impact on most asset classes in the near term and that the diversification of global payment systems will likely be the most important in the longer term. Filmed on November 10, 2020. Key Learnings: Alden explains that the long term debt cycle will likely play a role in the continued growth of Bitcoin and that the US political situation will weigh heavily on the near term growth in store of value assets. She lays out the primary factors that answer the questions, why Bitcoin? Why now?
Real Vision managing editor Ed Harrison and senior editor Ash Bennington discuss the all-time highs set on the S&P 500 and Nasdaq Composite on this holiday-shortened trading day in U.S. equity markets. Harrison and Bennington also take a step back to evaluate the broader context for rising stock prices during the month of November. Specifically, the pair explores the apparent recent decrease of political risk in the U.S., the impact of increasing case counts and virus fatalities, the potential effects of a Covid-19 vaccine on the global economic climate, and the risk of future lockdowns and growing geopolitical uncertainty in the Middle East.
Boaz Weinstein - Finding Relative Value Amid Credit Market Madness
Boaz Weinstein, founder and CIO of Saba Capital Management, made a name for himself at Deutsche Bank in the early days of credit derivatives. Since leaving to start his own fund he has continued to make a name for himself as a master of credit derivatives and relative value. In this interview with Real Vision’s Ed Harrison, Weinstein discusses how the current environment of tight spreads for pristine balance sheets and vulnerable companies alike is presenting some interesting relative value opportunities. Harrison and Weinstein also discuss Bill Ackman's recent reup on the same big CDS trade that has helped Saba return over 70% YTD, the Fed’s role in credit markets and credit ETF liquidity problems, and the opportunities Weinstein is seeing in closed-end funds. Filmed on November 23, 2020. Key Learnings: The credit of companies with close to zero percent chance of defaulting is trading at the same prices as companies with serious COVID risks is presenting RV opportunities. Closed-end funds trading at discounts to NAV are also presenting rare opportunities for yield in this low-rate environment.
Real Vision managing editor Ed Harrison welcomes Jack Farley for a Thanksgiving “Ask Me Anything” special edition of the Daily Briefing. Sourcing questions from the Real Vision Exchange, Jack asks Ed questions about whether the U.S. will enter a second round of lockdowns, and whether the equity market could once again undergo a major crash. Ed shares his views on the future of debt, deflation, and commodities, over the next 30 years, as well as his technique learning new languages. Jack and Ed share the ways in which they follow market news, as well as their views on the difference between accounting antics and downright fraud. Lastly, Jack and Ed give an inside look at Real Vision’s ongoing mission to democratize finance.
Christopher Joye: Liquidity Ignition in the Land Down Under
Christopher Joye, co-chief investment officer at Coolabah Capital Investments, joins Joe Walker of the Jolly Swagman Podcast to share his macro outlook on credit, rates, and housing in Australia. Joye forecasts the path of the coronavirus going forward, using quantitative models which have so far proved prescient. Joye tells Walker why Australian quantitative easing has buoyed the already richly-priced housing market (a prediction which won him the moniker "the hunter of Australian housing bears") as well as compressed credit spreads to very narrow levels. Filmed on November 16, 2020. Key learnings: The Reserve Bank of Australia may be late to the QE party, but this fiesta will run all night and those who can spot opportunities in credit and sovereign bonds will be rewarded handsomely.
Max Wiethe and Real Vision managing editor, Ed Harrison, discuss Ed's outlook for a winter double-dip recession in the U.S. and the most important questions for determining the breadth, depth, and market implications of this prediction. How bad will the pandemic get before this wave can be arrested? How severe an economic brake will have to occur to get the virus under control? What short- and long-term impact will this have on businesses? What can policymakers do to mitigate downside risk and prevent worst-case outcomes? How will all of this feed through into asset markets? In the intro, Real Vision's Haley Draznin, examines the juxtaposition between the markets hitting record highs and the broader economy as initial jobless claims rise for a second week in a row.
Iraq is not a place that immediately comes to mind when thinking of attractive investment opportunities. Despite decades of geopolitical turbulence, investors have long eyed frontier markets like Iraq for high-growth value investments. Geoffrey Batt, Managing Member of Euphrates Advisors, invests exclusively in Iraqi companies – from consumer-packaged goods and banks to telecommunications firms and e-commerce. For over a decade, he has invested in the Iraq Stock Exchange (ISX) and has been able to identify companies with long term capital appreciation. He sees a transformation currently taking place with Iraq's younger generation and the widespread adoption of fintech companies throughout the country. Filmed November 23, 2020. Key Learnings: Batt explains his investment philosophy in searching for economies with potential historic equity re-ratings. He notes that that the greatest opportunities in any market, asset class and investment are those in which there’s a very wide gap between perception and reality.
Senior editor Ash Bennington welcomes back Tony Greer of TG Macro to make sense of today’s price action as the equity markets roar to all-time highs. After the pair briefly discusses the significance of the news that Janet Yellen will likely be named Treasury Secretary, Tony shares his analysis on the value rotation away from the tech giants into cyclical reflation plays like banks, casinos, hotels, and energy. As Tony says, “the world is getting back in business”. Ash and Tony then look the performance of Bitcoin as it approaches its 2017 highs, and explore the future of gold as an inflation hedge. Lastly, Tony gives an update on his trades in the cannabis sector. In the intro, Real Vision's Haley Draznin analyzes the market rally to record highs as the Dow surpasses 30,000 for the first time ever and looks into the anticipated rebound in the economy for the second half of 2021.
Stephen Clapham and Kyle Bass: Accounting Schemes at Chinese Tech Giants
Hayman Capital's founder and CIO Kyle Bass welcomes forensic accountant and Behind the Balance Sheet's founder Stephen Clapham to break down the accounting irregularities peppered throughout the regulatory filings of China’s biggest tech companies. Sharing insights from his proprietary research report on Alibaba, Baidu, JD.com, Meituan Dianping, and Tencent, Clapham shines a light on the ways these companies are using loopholes in order to inflate profits, hide liabilities, and mask the capitalization of questionable assets. Bass frames Clapham's findings through the lens of notable balance sheet disasters and downright frauds, and they explore the jurisdictional risk of investing in Chinese companies in general. Lastly, Bass asks Clapham about his latest book, "The Smart Money Method: How to Pick Stocks Like A Hedge Fund Pro". Filmed on November 18, 2020. Key Learnings: Hidden risks lurk within corporate balance sheets, even those of the world’s largest tech companies. Stephen Clapham and Kyle Bass show viewers how to spot those risks before they can inflict major damage to your portfolio.
Real Vision editor Jack Farley hosts Tyler Neville of Real Vision for a spirited debate about the fate of risk assets. Tyler makes the case that U.S. equities have a lot more room to run, basing his case on tight credit spreads and the Federal Reserve’s ever-expanding balance sheet. Tyler incorporates market breadth as well as venture capital funding to argue that the punch bowl may never be removed. Jack challenges Tyler’s bullish thesis, asking Tyler about the upcoming expiration of the Fed’s emergency lending programs and the possibility that the holiday season will accelerate the spread of the COVID-19 virus. Jack and Tyler then explore the future of so-called “zombie companies,” whose liabilities have swelled to over $1.2 trillion. In the intro, Real Vision's Haley Draznin analyzes the promising developments of a coronavirus vaccine, how it impacts the markets, and why some sectors will benefit a lot more than others. For charts from Tyler as well as Jack, click here: https://rvtv.io/2URRNAH