Transcripts
Erik: Macrovoices episode 252 was pre-recorded on December 14, 2020. I’m Erik Townsend.
This episode is brought to you by Abaxx Technologies. Pioneering the design of Smarter Markets that better meet the needs of both market participants and society as a whole.
...and by the North Shore Global Uranium Mining ETF – ticker URNM. a focused play on miners and holders of uranium.
There won’t be any market wrap or postgame segment this week. Instead we’ll be bringing you part two of our holiday special, in which we’re taking a deep dive on the topic of fiat currency being debased in real value. Patrick Ceresna will host the series, and I’ll be acting as a panelist alongside both Grant Williams, author of the Things that Make You Go Hmm newsletter and producer of the Grant Williams Podcast, and Ronni Stoefele, publisher of the In Gold We Trust report and fund manager for Incrementum.
In last week’s episode, we began with a review of the major events of 2020, then discussed the topic of fiat currency debasement at a high level, before moving on to distinguish fiat debasement from inflation. We then discussed which trading strategies are appropriate to hedge each of these separate and distinct phenomena. We even pondered whether Bitcoin is replacing Gold as the favored store-of-value hedge against fiat debasement.
This week we’re going to return to the distinction between inflation and fiat debasement, and then talk through a long list of hedging trades against each of those risks, ranging from precious metals to bitcoin to farmland to base metals and crude oil.
We’ll be back to our regular format with a market wrap and postgame segment on January 7th.
Patrick, let’s dive right back in where we left off last week…
Erik: Macrovoices Episode 251 was pre-recorded on December 14, 2020. I’m Erik Townsend.
This episode is brought to you by Abaxx Technologies. Pioneering the design of Smarter Markets that better meet the needs of both market participants and society as a whole.
...and by the North Shore Global Uranium Mining ETF – ticker URNM. a focused play on miners and holders of uranium.
There won’t be any market wrap or postgame segment this week or next. Instead we’ll be bringing you a two-part holiday special, in which we’re going to take a deep dive on the topic of fiat currency being debased in real value because of accommodative central bank monetary policy and expectations that the growing popularity of Modern Monetary Policy among policymakers will accelerate the pace of fiat debasement. And we’re bringing in the big guns for this special series. Patrick Ceresna will host the series, and I’ll be acting as a panelist alongside both Grant Williams, author of the Things that Make You Go Hmm newsletter and producer of the Grant Williams Podcast, and Ronni Stoefele, publisher of the In Gold We Trust report and fund manager for Incrementum.
Erik: Joining me now is Hayman Capital founder and fund manager Kyle Bass.
Kyle, it’s great to finally get you on MacroVoices. I think you are our most requested guest ever.
Here we are: global pandemic, big explosion in cases, hospitalizations, deaths. Monday this week, Mayor de Blasio said get ready for a possible total shutdown of New York City.
Lots of bad stuff going on. Stock market rallying to effectively all-time highs.
What’s going on here? Is it basically we’re in a new market paradigm where it’s all about expectations of Fed stimulus? Or how is it possible that we’re at all-time highs with, really, a hundred-year disaster on our hands?
Kyle: I tell you, the markets are very good at looking across even the Grand Canyon when you’re talking about different shapes of recovery.
But I think in this case we’ve seen – this word is so often used today that it becomes lest impactful. But we’ve seen an unprecedented coordinated global central-bank response to the Chinese pandemic that I think the amount of both M1 and M2 in global systems, coupled with the fact that we are getting to a place where we have a vaccine that shows a very effective response – call it 90%-plus efficacy – and its ability to vaccinate against this horrible virus.
So I think by the middle of 2021, we’re going to have a vaccine-led boom in global markets coupled with the fact that we have so much cash sloshing around. That’s why you see both stocks and bitcoin and assets and basically everything you and I can buy is headed to new highs.
Erik: Joining me now is former US presidential advisor and bestselling author Dr. Pippa Malmgren. Pippa, it’s great to have you back on MacroVoices.
Pippa: I love being back on MacroVoices.
Erik: Longtime MacroVoices listeners will remember right after the 2016 presidential election when Pippa joined us on MacroVoices and shared with us her hypothesis that President Trump’s real motivation for running for the presidency in the first place might have actually been to set the stage for launching his own news network.
Pippa even went on to say that he probably didn’t expect to win initially. But, of course, when he did win he wasn’t going to turn down the presidency. She told us to watch in the reelection process for signs of a turn, suggesting there was a possibility if it looked like the president could not win the reelection that he might even drop out of the race and focus instead on launching a news network.
Now, what’s happened is, of course, we did have an election. He didn’t drop out. But already there has been an announcement that President Trump may be pursuing a news network, although he is still adamantly refusing to concede the loss of the election.
We’re going to focus in today’s episode on what it might mean if Pippa was right, as the circumstances seem to reveal and President Trump’s real agenda here is not fighting to stay in the White House but rather drumming up an audience for a new Trump news network.
Pippa, let’s get an update from your perspective.
Erik: Joining me now is Alhambra Investments Chief Investment Officer, Jeffrey Snider.
For newer listeners who are not familiar with Jeff, he’s not only one of our most popular returning guests but he’s well known for his slide decks and the quality of his graphs and charts. So you’re not going to want to miss the slide deck that accompanies today’s interview.
Registered users will find the download link in your Research Roundup email. If you’re not yet registered, just go to our macrovoices.com home page, click the red button that says Looking for the Downloads? just above Jeff’s picture.
Jeff, for years now we’ve had quite a few other guests on MacroVoices tell us that the dollar was doomed. And the things they usually cite are that the government is printing money like it’s going out of style, reckless spending. And they’re saying eventually this has to lead to debasement of the dollar.
You’ve been the lone voice saying, hey guys, the dollar is just as broken as you think it is, but it’s broken in a very bizarre way where the mechanism for creating more dollars in the international market, the eurodollar system, is not creating dollars the way it’s supposed to. And, ironically, that’s more likely to lead to dollar appreciation, effectively a short squeeze.
For quite a bit of that time, Jeff, you were kind of proven right. Things were going more in the up direction for the dollar than down.
But I think we’ve been here before and we have it again. The dollar index is plumbing multi-year lows. It’s been trading lower ever since May.
Is this the beginning of that long-forecasted dollar crash which would eventually change your thesis?
MACRO VOICES is presented for informational and entertainment purposes only. The information presented in MACRO VOICES should NOT be construed as investment advice. Always consult a licensed investment professional before making important investment decisions. The opinions expressed on MACRO VOICES are those of the participants. MACRO VOICES, its producers, and hosts Erik Townsend and Patrick Ceresna shall NOT be liable for losses resulting from investment decisions based on information or viewpoints presented on MACRO VOICES.
