1 00:00:03,120 --> 00:00:16,360 Speaker 1: Bloomberg Audio Studios, Podcasts, radio News. 2 00:00:20,720 --> 00:00:24,639 Speaker 2: Hello and welcome to another episode of the Odd Lats podcast. 3 00:00:24,720 --> 00:00:27,040 Speaker 3: I'm Joe Wisenthal and I'm Tracy Alloway. 4 00:00:27,400 --> 00:00:28,280 Speaker 4: Racy, you know, it's. 5 00:00:28,120 --> 00:00:31,080 Speaker 2: Sort of giving me a little bit of anxiety these days. 6 00:00:31,120 --> 00:00:34,640 Speaker 3: Just I feel like that's a dangerous question to ask 7 00:00:34,680 --> 00:00:35,360 Speaker 3: your coworker. 8 00:00:35,440 --> 00:00:38,159 Speaker 4: But go on, I mean, it does seem right, It 9 00:00:38,200 --> 00:00:39,599 Speaker 4: could be anything. It's not personal. 10 00:00:40,440 --> 00:00:46,559 Speaker 2: It does seem like across many industries evs, etc. Like 11 00:00:47,360 --> 00:00:53,320 Speaker 2: Chinese firms either because they're doing very well organizationally, technologically 12 00:00:53,600 --> 00:00:56,840 Speaker 2: or whatever, or cost competitively or like really killing it 13 00:00:56,840 --> 00:00:59,560 Speaker 2: in a lot of industries. And it is an American who, 14 00:00:59,680 --> 00:01:03,720 Speaker 2: you know, on to the thriving US economy watching say, 15 00:01:03,840 --> 00:01:06,080 Speaker 2: like on the same day, like the day after Boeing 16 00:01:06,160 --> 00:01:09,200 Speaker 2: is experiencing some new investigation, and then the next day 17 00:01:09,240 --> 00:01:12,200 Speaker 2: seeing some headline about the COMAC is like expanding its factories. 18 00:01:12,240 --> 00:01:13,920 Speaker 4: It's like, like, what's been on here? 19 00:01:14,080 --> 00:01:15,920 Speaker 3: Yeah, I know what you mean. I feel like evs 20 00:01:15,920 --> 00:01:18,440 Speaker 3: are sort of a microcosm for I guess a lot 21 00:01:18,480 --> 00:01:21,600 Speaker 3: of anxiety over the Chinese economy. So first of all, 22 00:01:21,640 --> 00:01:23,479 Speaker 3: the idea that China is sort of going to leap 23 00:01:23,520 --> 00:01:27,360 Speaker 3: frog America in one way or another in terms of technology, 24 00:01:27,560 --> 00:01:30,959 Speaker 3: renewable technology as we've sort of seen in solar panels, 25 00:01:31,000 --> 00:01:33,840 Speaker 3: but also the idea that to some extent, China has 26 00:01:33,880 --> 00:01:36,959 Speaker 3: a lot of policy levers to pullah in a way 27 00:01:37,040 --> 00:01:42,600 Speaker 3: that the US sometimes struggles with. So President Chichiping can 28 00:01:42,720 --> 00:01:45,720 Speaker 3: go out and say we want China to make massive 29 00:01:46,240 --> 00:01:50,920 Speaker 3: investments in things like evs or in things like semiconductors, 30 00:01:51,160 --> 00:01:54,280 Speaker 3: and to some extent the entire economy sort of turns 31 00:01:54,280 --> 00:01:55,480 Speaker 3: that way and starts doing it. 32 00:01:55,800 --> 00:01:58,440 Speaker 2: And just to be clear, like, I think it's good 33 00:01:58,600 --> 00:02:01,200 Speaker 2: that more countries around the world world are getting richer 34 00:02:01,200 --> 00:02:02,279 Speaker 2: and more competitive and. 35 00:02:02,480 --> 00:02:03,400 Speaker 4: Able to like. 36 00:02:03,560 --> 00:02:05,240 Speaker 2: So I don't see the world as some sort of 37 00:02:05,560 --> 00:02:10,240 Speaker 2: zero sum type thing. But if the US is embarking 38 00:02:10,400 --> 00:02:13,880 Speaker 2: on this sort of renewed industrialization push, if we think 39 00:02:13,880 --> 00:02:16,400 Speaker 2: it's valuable, if we think it's important that certain types 40 00:02:16,440 --> 00:02:19,440 Speaker 2: of batteries and cars, etc. Are manufactured here, which we 41 00:02:19,480 --> 00:02:23,959 Speaker 2: seem to have prioritized, also chips, then the question is like, well, 42 00:02:24,000 --> 00:02:27,960 Speaker 2: will any of this be competitive globally cost competitive effective 43 00:02:28,200 --> 00:02:33,480 Speaker 2: similar technology technology to what competitors overseas are doing. 44 00:02:33,520 --> 00:02:36,639 Speaker 3: But also just to ease your anxiety a little bit, 45 00:02:36,680 --> 00:02:38,760 Speaker 3: because that's what I'm here for. There are a lot 46 00:02:38,760 --> 00:02:41,919 Speaker 3: of question marks around the direction of the Chinese economy 47 00:02:41,960 --> 00:02:45,840 Speaker 3: at the moment. There's speculation over a un devaluation. Interest 48 00:02:45,919 --> 00:02:49,480 Speaker 3: rates are already pretty low, You're struggling to boost economic growth. 49 00:02:49,520 --> 00:02:51,560 Speaker 3: So you have these sort of twenty things happening at 50 00:02:51,560 --> 00:02:52,040 Speaker 3: the same time. 51 00:02:52,160 --> 00:02:56,400 Speaker 2: No, I, China unambiguously has its host of issues. That 52 00:02:56,560 --> 00:02:59,400 Speaker 2: being said, you know, I do think that for as 53 00:02:59,440 --> 00:03:03,120 Speaker 2: long as I been paying attention to markets, economic stuff 54 00:03:03,120 --> 00:03:05,640 Speaker 2: like that, one of the overriding questions is like, well, 55 00:03:05,639 --> 00:03:07,560 Speaker 2: when is the crash? When is the financial core? And 56 00:03:07,600 --> 00:03:10,440 Speaker 2: it hasn't really happened. Like, There's been some issues now 57 00:03:10,480 --> 00:03:12,840 Speaker 2: and obviously they sort of on purpose to some extent 58 00:03:12,840 --> 00:03:15,840 Speaker 2: prick to the real estate bubble, but by and large 59 00:03:16,160 --> 00:03:18,280 Speaker 2: some sort of like big Chinese disaster the likes of 60 00:03:18,320 --> 00:03:20,200 Speaker 2: which many people have been expecting for a long time 61 00:03:20,200 --> 00:03:21,040 Speaker 2: of not materialized. 62 00:03:21,120 --> 00:03:23,920 Speaker 3: I think this goes back to the command economy policy 63 00:03:24,000 --> 00:03:27,160 Speaker 3: lever idea, and if you have those types of levers, 64 00:03:27,600 --> 00:03:29,800 Speaker 3: you can kind of pull them and buy yourself time. 65 00:03:29,919 --> 00:03:32,440 Speaker 3: And that's what we've seen over and over again. You 66 00:03:32,480 --> 00:03:35,320 Speaker 3: do have these disasters that happen in the Chinese economy, 67 00:03:35,840 --> 00:03:39,280 Speaker 3: like the three red lines proposition for real estate that 68 00:03:39,400 --> 00:03:41,520 Speaker 3: led to a housing crash. But on the other hand, 69 00:03:41,600 --> 00:03:44,520 Speaker 3: you have sort of measures that can offset some of that, 70 00:03:44,720 --> 00:03:47,360 Speaker 3: and I guess extend and pretend for a. 71 00:03:47,320 --> 00:03:48,520 Speaker 4: While totally well. 72 00:03:48,560 --> 00:03:51,640 Speaker 2: I am really excited about our guests. We've had him 73 00:03:51,680 --> 00:03:53,600 Speaker 2: on the show once and before, although now he's in 74 00:03:53,800 --> 00:03:56,440 Speaker 2: studio with us, which is always a lot more fun. 75 00:03:56,960 --> 00:04:00,160 Speaker 2: Someone who has been covering this story for years. I 76 00:04:00,200 --> 00:04:02,280 Speaker 2: first discovered him probably in two thousand and eight or 77 00:04:02,280 --> 00:04:04,680 Speaker 2: two thousand and nine, watching his YouTube videos where he 78 00:04:04,760 --> 00:04:07,560 Speaker 2: was in China looking at these gigantic I think the 79 00:04:07,680 --> 00:04:09,440 Speaker 2: term at the time was called ghost cities, where there 80 00:04:09,480 --> 00:04:12,000 Speaker 2: are tons of skyscrapers and apartments and at the time 81 00:04:12,400 --> 00:04:14,040 Speaker 2: no one was ever living in them, and had sort 82 00:04:14,040 --> 00:04:17,160 Speaker 2: of raised all these questions about misallocation, all these questures. Anyway, 83 00:04:17,680 --> 00:04:22,520 Speaker 2: we are speaking to the acid capitalist himself, former hedge 84 00:04:22,520 --> 00:04:25,240 Speaker 2: fund manager, now all around cool guy who lives in 85 00:04:25,279 --> 00:04:27,400 Speaker 2: Saint Barts, but he graced us with his presence here 86 00:04:27,400 --> 00:04:29,760 Speaker 2: in New York City. Hugh Hendry, thank you so much 87 00:04:29,800 --> 00:04:31,280 Speaker 2: for coming back on odd Laws. 88 00:04:31,760 --> 00:04:33,919 Speaker 5: It is an absolute pleasure and you know, for the 89 00:04:33,960 --> 00:04:35,760 Speaker 5: folks at home, if you want to see the future, 90 00:04:35,800 --> 00:04:36,640 Speaker 5: you got to get high. 91 00:04:37,080 --> 00:04:40,400 Speaker 4: Yeah, why is that? Why? 92 00:04:40,560 --> 00:04:41,839 Speaker 3: Let's just leave it there. 93 00:04:41,600 --> 00:04:43,640 Speaker 4: Let's not leave it there. Why do you need to 94 00:04:43,640 --> 00:04:44,719 Speaker 4: get high to see the future? 95 00:04:44,839 --> 00:04:48,320 Speaker 5: What I mean, I like me. So what that means is, 96 00:04:48,720 --> 00:04:52,480 Speaker 5: so I'm on a mission to try and give the 97 00:04:52,520 --> 00:04:57,520 Speaker 5: indication that the science of finance should be left alone 98 00:04:57,600 --> 00:05:00,440 Speaker 5: and we should actually embrace the arts of the future. Yeah, 99 00:05:00,839 --> 00:05:03,240 Speaker 5: that is a creative flow, and you're not going to 100 00:05:03,279 --> 00:05:05,839 Speaker 5: get there just by clocking up hours, wearing a suit 101 00:05:05,960 --> 00:05:08,600 Speaker 5: and staring at a spreadsheet. Yeah, you've got to get 102 00:05:08,600 --> 00:05:10,440 Speaker 5: a little bit kind of creative with it. And so 103 00:05:10,720 --> 00:05:12,920 Speaker 5: I'm kind of trying to put out my career. I've 104 00:05:12,920 --> 00:05:15,920 Speaker 5: got my book coming out later this summer, and it's 105 00:05:15,960 --> 00:05:19,000 Speaker 5: it's a different path. There are many paths. Yeah, we 106 00:05:19,080 --> 00:05:21,479 Speaker 5: only get presented the path with the guy. You know, 107 00:05:21,920 --> 00:05:24,200 Speaker 5: they're always guys, Whereas there are all those guys, you know, 108 00:05:24,400 --> 00:05:27,240 Speaker 5: and they got the ties and they don't see the future, 109 00:05:27,320 --> 00:05:28,880 Speaker 5: but they get a lot of air time. 110 00:05:29,720 --> 00:05:32,080 Speaker 3: For listeners who can't see you. Right now, I can 111 00:05:32,120 --> 00:05:34,960 Speaker 3: confirm that he is not, in fact wearing a tie. 112 00:05:35,400 --> 00:05:37,920 Speaker 3: But Hugh here's something I want to ask. I feel 113 00:05:37,960 --> 00:05:39,599 Speaker 3: like you might have the answer to this. Have you 114 00:05:39,600 --> 00:05:44,839 Speaker 3: ever stared and EXCEL spreadsheet while on acid? What happens? 115 00:05:46,040 --> 00:05:49,200 Speaker 5: You certainly don't stare at spreadge. I've stared at walls. 116 00:05:50,400 --> 00:05:52,400 Speaker 5: I mean at Saturday night, there was a wall that 117 00:05:52,440 --> 00:05:55,960 Speaker 5: really came alive. So I'll give it back to you 118 00:05:56,000 --> 00:05:56,960 Speaker 5: on that try that. 119 00:05:57,000 --> 00:06:00,160 Speaker 3: You should try it like new patterns or like when 120 00:06:00,200 --> 00:06:01,200 Speaker 3: you do you realize something. 121 00:06:01,279 --> 00:06:03,520 Speaker 2: The next time you go back and look at that spreadsheet, 122 00:06:03,520 --> 00:06:05,479 Speaker 2: you see something there that wasn't there before. 123 00:06:05,520 --> 00:06:07,760 Speaker 5: I just don't look at the spreadshe some has to 124 00:06:07,800 --> 00:06:10,200 Speaker 5: have someone else look. Someone has to look at the spreadsheets. 125 00:06:10,279 --> 00:06:13,440 Speaker 5: So actually what I did was, I mean the wonderful 126 00:06:13,440 --> 00:06:16,839 Speaker 5: Bloomberg and the graphics package. There was a function for 127 00:06:16,839 --> 00:06:18,680 Speaker 5: game I can't remember the name now, but I would 128 00:06:18,680 --> 00:06:21,279 Speaker 5: load like the S and P five hundred and I'd 129 00:06:21,279 --> 00:06:24,320 Speaker 5: have my designated kind of the images in terms of 130 00:06:24,320 --> 00:06:27,480 Speaker 5: the moving averages and what have you, and i'd sign 131 00:06:27,560 --> 00:06:30,080 Speaker 5: maybe ten seconds stage tart because it's like five hundred, 132 00:06:30,400 --> 00:06:32,599 Speaker 5: and I'd watch and I'd see patterns, and for me, 133 00:06:32,920 --> 00:06:35,760 Speaker 5: I was becoming like a paranoid schizophrenic because the charts 134 00:06:36,000 --> 00:06:39,440 Speaker 5: would create voices in my head, and with those voices 135 00:06:39,720 --> 00:06:43,040 Speaker 5: and the pattern recognition, and they were spread and concentrated 136 00:06:43,080 --> 00:06:44,520 Speaker 5: on particular industries. 137 00:06:44,800 --> 00:06:47,400 Speaker 2: Did you ever see the movie Pi? Yeah, that's one 138 00:06:47,400 --> 00:06:48,400 Speaker 2: of my Have you seen that trace? 139 00:06:48,400 --> 00:06:48,719 Speaker 5: And I haven't. 140 00:06:48,760 --> 00:06:49,400 Speaker 4: I've always wanted to. 141 00:06:49,400 --> 00:06:51,920 Speaker 2: Do an episode on that, which is basically like they're 142 00:06:52,000 --> 00:06:54,560 Speaker 2: an old like Darren Aronovski movie, or this guy like 143 00:06:54,839 --> 00:06:57,520 Speaker 2: is convinced he kind of has like a psychic breakdown, 144 00:06:57,600 --> 00:06:59,960 Speaker 2: but he's sort of convinced that he sees the entire 145 00:07:00,080 --> 00:07:03,719 Speaker 2: hire pattern of the stock market and can predicted second 146 00:07:03,760 --> 00:07:07,880 Speaker 2: to second through like numerology and kablo and Jewish mysticism 147 00:07:07,960 --> 00:07:08,440 Speaker 2: and all this stuff. 148 00:07:08,480 --> 00:07:09,600 Speaker 4: It's a great movie. 149 00:07:09,840 --> 00:07:12,720 Speaker 3: When I have mental breakdowns, I just eat ice cream 150 00:07:12,720 --> 00:07:14,160 Speaker 3: and can't get out of bed in the morning. But 151 00:07:14,240 --> 00:07:18,600 Speaker 3: other people unlock the secrets of financial markets much more productive. 152 00:07:19,000 --> 00:07:23,120 Speaker 5: Well, I got paranoid because I was risking other people's 153 00:07:23,160 --> 00:07:27,040 Speaker 5: precious capital using these voices in my head. But the 154 00:07:27,120 --> 00:07:29,600 Speaker 5: paranoid is a good thing, and that's when I had 155 00:07:29,600 --> 00:07:32,080 Speaker 5: to call for the spreadsheets. So don't get me wrong. 156 00:07:32,240 --> 00:07:34,560 Speaker 5: I listened to music and I was kind of separate 157 00:07:34,600 --> 00:07:37,680 Speaker 5: from my team, but there was a fusion where I had, 158 00:07:37,720 --> 00:07:40,600 Speaker 5: like the CIA, I had an intelligence operation, and I said, 159 00:07:40,640 --> 00:07:43,320 Speaker 5: I'm crazy, challenge me. Let's see if we can find 160 00:07:43,320 --> 00:07:45,640 Speaker 5: a synthesis. So I take a position. I take a 161 00:07:45,680 --> 00:07:48,280 Speaker 5: small risk position. But when we got or if we 162 00:07:48,280 --> 00:07:50,840 Speaker 5: could get confirmation, then we would build and we'd lean 163 00:07:50,880 --> 00:07:53,240 Speaker 5: into it. So you know, I don't mean just to 164 00:07:53,240 --> 00:07:54,960 Speaker 5: be a circus free. You know there's more too. 165 00:07:55,480 --> 00:07:58,000 Speaker 3: So speaking of challenging yourself, one of the things you're 166 00:07:58,000 --> 00:08:00,880 Speaker 3: doing right now on your sub stack is you are 167 00:08:00,920 --> 00:08:05,400 Speaker 3: publishing all the old letters from your hedge fund Eclectica, 168 00:08:06,040 --> 00:08:10,560 Speaker 3: And I'm curious, what was What's the goal of doing that? 169 00:08:10,680 --> 00:08:13,840 Speaker 3: Is it sort of self reflection? Is it seeing how 170 00:08:13,880 --> 00:08:17,960 Speaker 3: your investment vcs have stacked up, you know, two decades 171 00:08:18,080 --> 00:08:19,000 Speaker 3: or whatever it is later? 172 00:08:19,800 --> 00:08:23,120 Speaker 5: Yeah, I mean it is the diary of a long 173 00:08:23,200 --> 00:08:27,000 Speaker 5: period of my life. And for I guess, you know, 174 00:08:27,480 --> 00:08:29,920 Speaker 5: I take a different step perhaps from the rest of 175 00:08:29,960 --> 00:08:32,720 Speaker 5: the community, and I gave everything. I mean, it became 176 00:08:32,800 --> 00:08:35,120 Speaker 5: like a mouse trap. Like people liked it because it 177 00:08:35,160 --> 00:08:37,520 Speaker 5: was a little bit zany. And then the challenges each 178 00:08:37,559 --> 00:08:40,040 Speaker 5: month You've got to redesign the mouse trap. So I 179 00:08:40,080 --> 00:08:42,160 Speaker 5: was always late. I had to be the very last 180 00:08:42,240 --> 00:08:44,640 Speaker 5: day before I could actually get the thing written. But 181 00:08:44,800 --> 00:08:47,440 Speaker 5: there's a lot happened over that period. We're talking about 182 00:08:47,440 --> 00:08:50,079 Speaker 5: the period from October two thousand and two to October 183 00:08:50,400 --> 00:08:54,160 Speaker 5: twenty seventeen. And you know, at leisure it comes at 184 00:08:54,280 --> 00:08:57,319 Speaker 5: you know, my or my sub stock, and you get 185 00:08:57,360 --> 00:08:59,280 Speaker 5: to see it and it resonates that I'm playing with 186 00:08:59,400 --> 00:09:02,880 Speaker 5: language and you can then it's nice. It's like a 187 00:09:02,920 --> 00:09:05,240 Speaker 5: game where you can actually I'm predicting. I'm trying to 188 00:09:05,240 --> 00:09:08,400 Speaker 5: predict the future, and you can actually determine with your 189 00:09:08,440 --> 00:09:10,840 Speaker 5: coffee if I got it right what my hit ratio 190 00:09:10,920 --> 00:09:12,880 Speaker 5: is so and it becomes kind of fun. I hope. 191 00:09:13,280 --> 00:09:14,760 Speaker 4: What have you learned about yourself? 192 00:09:14,840 --> 00:09:16,520 Speaker 2: I mean when you go back and read those two 193 00:09:16,559 --> 00:09:19,240 Speaker 2: thousand and two some of the over twenty years now, 194 00:09:19,760 --> 00:09:22,000 Speaker 2: are there things that you look back at your own 195 00:09:22,120 --> 00:09:25,360 Speaker 2: thinking you're like, oh, this was these ideas weren't fully formed, 196 00:09:25,600 --> 00:09:28,680 Speaker 2: or things that you later changed your mind about or 197 00:09:28,679 --> 00:09:31,480 Speaker 2: had new perspectives, Like what have you learned rereading your 198 00:09:31,520 --> 00:09:32,960 Speaker 2: old hedge fund letters? 199 00:09:33,600 --> 00:09:36,839 Speaker 5: Heavens? Yeah, what did I learn? I mean, the I 200 00:09:37,200 --> 00:09:40,720 Speaker 5: tell you what I'm most proud about. It was a 201 00:09:40,720 --> 00:09:45,120 Speaker 5: form of deduction which I had write at the beginning, 202 00:09:45,640 --> 00:09:48,760 Speaker 5: because right at the beginning, this is before the Zukenbergs 203 00:09:48,960 --> 00:09:52,319 Speaker 5: and you know, the Amazons, where you have a platform, 204 00:09:52,400 --> 00:09:54,839 Speaker 5: it goes global and like you're the richest person on there, 205 00:09:55,000 --> 00:10:00,520 Speaker 5: like Elon, etc. And back then, the highest return intellectual 206 00:10:00,559 --> 00:10:02,720 Speaker 5: capital was to be a hedge fund manager, you know, 207 00:10:02,800 --> 00:10:06,000 Speaker 5: like two and twenty if not more. And so by 208 00:10:06,040 --> 00:10:10,120 Speaker 5: logical deduction, you got to think you're up against the 209 00:10:10,200 --> 00:10:12,560 Speaker 5: smartest minds on the planet. And of course when you 210 00:10:12,600 --> 00:10:15,240 Speaker 5: meet some of these guys and girls, maybe not, but 211 00:10:15,400 --> 00:10:17,800 Speaker 5: you know, but it kind of stands up. Yeah, And 212 00:10:18,240 --> 00:10:20,880 Speaker 5: I kind of concluded that it actually didn't make any 213 00:10:20,920 --> 00:10:25,440 Speaker 5: sense to twine out smart the smartest people. Yeah, like 214 00:10:25,640 --> 00:10:28,880 Speaker 5: you're going to fail, Okay, And so I reverse engineered 215 00:10:28,920 --> 00:10:31,480 Speaker 5: and I said, why is it in this like musical 216 00:10:31,559 --> 00:10:34,120 Speaker 5: chair game that we call the markets, why is it 217 00:10:34,160 --> 00:10:36,960 Speaker 5: that it's not enough to be super super smart, Because 218 00:10:37,040 --> 00:10:39,200 Speaker 5: let's face it, everyone out there and listening to this, 219 00:10:39,440 --> 00:10:43,199 Speaker 5: everyone's got like a really high threshold level of intelligence. 220 00:10:43,440 --> 00:10:45,280 Speaker 5: And so that's why, you know, we come back into 221 00:10:45,320 --> 00:10:48,960 Speaker 5: my acid capitalist. Yeah brand, it sounds like cute and stuff, 222 00:10:49,040 --> 00:10:51,640 Speaker 5: it actually had a function, you know, and you know 223 00:10:51,640 --> 00:10:54,040 Speaker 5: when people would throw up their arms, So who were 224 00:10:54,040 --> 00:10:57,360 Speaker 5: to fast forward into horror story of late two thousand 225 00:10:57,360 --> 00:11:00,959 Speaker 5: and eight and Liman goes by and crabs and we've 226 00:11:01,000 --> 00:11:03,920 Speaker 5: all seen the movie, you know, the Big Short. I 227 00:11:03,920 --> 00:11:05,800 Speaker 5: mean I knew all those guys. I was the London 228 00:11:05,840 --> 00:11:08,800 Speaker 5: operation of that. But yeah, when the suit guys throwing 229 00:11:08,840 --> 00:11:11,400 Speaker 5: their hands up and they're saying, who would have guessed that? Well, 230 00:11:11,720 --> 00:11:14,360 Speaker 5: littleal me. You know, I made fifty percent in the 231 00:11:14,400 --> 00:11:14,880 Speaker 5: month of the two. 232 00:11:30,679 --> 00:11:32,480 Speaker 3: So one thing we wanted to talk to you about 233 00:11:32,679 --> 00:11:35,720 Speaker 3: is obviously China. And I feel like going back and 234 00:11:35,800 --> 00:11:40,480 Speaker 3: reading over some of your own your old notes. Uh, directionally, 235 00:11:41,000 --> 00:11:44,320 Speaker 3: you got the China call right, but timing has sort 236 00:11:44,360 --> 00:11:46,079 Speaker 3: of been an issue here and maybe it goes back 237 00:11:46,120 --> 00:11:48,680 Speaker 3: to those policy levers that we were talking about in 238 00:11:48,720 --> 00:11:52,040 Speaker 3: the intro. But walk us through the China thesis in 239 00:11:52,080 --> 00:11:56,080 Speaker 3: sort of the early mid two thousands and how it 240 00:11:56,160 --> 00:11:56,640 Speaker 3: panned out. 241 00:11:56,840 --> 00:11:59,240 Speaker 5: Yeah, I mean, I am the pig on the Chinese 242 00:11:59,320 --> 00:12:05,079 Speaker 5: column and China. China has been has been the formative 243 00:12:05,480 --> 00:12:08,840 Speaker 5: energy and force for my career and the career of 244 00:12:08,840 --> 00:12:12,000 Speaker 5: all speculators, and really over the last forty years, the 245 00:12:12,080 --> 00:12:15,160 Speaker 5: rise and rise of China has actually, I think been 246 00:12:15,200 --> 00:12:19,640 Speaker 5: responsible for the what is now the preposterous rise and 247 00:12:19,720 --> 00:12:23,600 Speaker 5: rise in asset prices. Not trying to explain that, but 248 00:12:23,760 --> 00:12:26,680 Speaker 5: you know, back at the beginning, when I was listening 249 00:12:26,760 --> 00:12:28,960 Speaker 5: to the she I was seeing the sheet music on 250 00:12:29,000 --> 00:12:32,079 Speaker 5: my Bloomberg terminal, I was seeing the chart formations. What 251 00:12:32,200 --> 00:12:35,920 Speaker 5: was I seeing? I was seeing the most ugly old 252 00:12:35,960 --> 00:12:39,480 Speaker 5: industrial businesses that no one had wanted to own for 253 00:12:39,600 --> 00:12:43,120 Speaker 5: twenty years. Everyone was in services and drugstocks, et cetera. 254 00:12:43,480 --> 00:12:48,040 Speaker 5: I was seeing the worst businesses and they were coming alive. 255 00:12:48,760 --> 00:12:49,400 Speaker 5: I trapped you. 256 00:12:49,440 --> 00:12:51,480 Speaker 2: Through what's example that when you say that one of 257 00:12:51,520 --> 00:12:52,880 Speaker 2: the worst businesses and they're coming. 258 00:12:52,760 --> 00:12:56,640 Speaker 5: Up, Oh, they would be like smelters, Yeah, you know, 259 00:12:56,679 --> 00:13:01,200 Speaker 5: like I mean, just insanely ugly business is. Yeah, they 260 00:13:01,400 --> 00:13:04,000 Speaker 5: had not earned an appropriate return on capital for the 261 00:13:04,080 --> 00:13:07,680 Speaker 5: longest time, and they were coming alive. And so I 262 00:13:07,760 --> 00:13:10,480 Speaker 5: used a lot of like you know, like people on 263 00:13:10,480 --> 00:13:13,440 Speaker 5: Twitter and stuff in Bloomberg they throw around charts and 264 00:13:13,440 --> 00:13:15,199 Speaker 5: they look at a three month charm me one is 265 00:13:15,200 --> 00:13:17,680 Speaker 5: a three month chart. I want ingredient show me everything. 266 00:13:17,720 --> 00:13:20,200 Speaker 5: So I'm looking at forty years and I'm seeing things 267 00:13:20,200 --> 00:13:23,160 Speaker 5: which stop falling and then One of the other key 268 00:13:23,640 --> 00:13:27,400 Speaker 5: determinerts that I was using was things go right, stocks 269 00:13:27,559 --> 00:13:31,319 Speaker 5: and risk positions. They go right relative to their peer 270 00:13:31,400 --> 00:13:34,760 Speaker 5: group before they actually go right in absolute terms, and 271 00:13:34,800 --> 00:13:36,440 Speaker 5: so you've got to lean in there. So I was 272 00:13:36,480 --> 00:13:39,400 Speaker 5: beginning to say this immense relative performance. I mean, let 273 00:13:39,400 --> 00:13:42,160 Speaker 5: me give you an example with regard so like another 274 00:13:42,320 --> 00:13:44,520 Speaker 5: like really dumb thing, which is gold. I know that 275 00:13:44,720 --> 00:13:49,040 Speaker 5: inflames people, but you know gold had had what twenty 276 00:13:49,080 --> 00:13:51,520 Speaker 5: five horrid years. It peaked at eight hundred and ten 277 00:13:51,559 --> 00:13:54,480 Speaker 5: bucks in nineteen eighty and it was like two hundred 278 00:13:54,480 --> 00:13:57,000 Speaker 5: and seventy bucks by the time the British Treasury got 279 00:13:57,040 --> 00:13:59,719 Speaker 5: through selling it at the very very bottom in two 280 00:13:59,679 --> 00:14:02,480 Speaker 5: thousand in two thousand and two, who are they selling 281 00:14:02,520 --> 00:14:04,880 Speaker 5: it to? I was buying it my first I got 282 00:14:04,920 --> 00:14:08,120 Speaker 5: fifteen years of this blessed thing we call speculation, because 283 00:14:08,240 --> 00:14:11,200 Speaker 5: my first calendar year I made fifty percent. I'm not glory. 284 00:14:11,559 --> 00:14:15,360 Speaker 5: What I'm meaning by that is the failure rate in 285 00:14:15,400 --> 00:14:18,560 Speaker 5: hedge funds. It's like a restaurant. Most restaurants fail, yeah, 286 00:14:18,600 --> 00:14:21,680 Speaker 5: and the return to the survivor is really high. And 287 00:14:21,760 --> 00:14:23,600 Speaker 5: I got happen as there was times, so I didn't 288 00:14:23,600 --> 00:14:26,720 Speaker 5: think I was gonna make it, but I was absurdly 289 00:14:26,920 --> 00:14:29,360 Speaker 5: long gold. And again, if you're like a wanna be 290 00:14:29,800 --> 00:14:33,000 Speaker 5: new hedge fund manager, like I got it, tariously, you 291 00:14:33,000 --> 00:14:35,960 Speaker 5: ain't gonna make it in your first year if you're 292 00:14:35,960 --> 00:14:38,120 Speaker 5: not making money, and you ain't gonna make it if 293 00:14:38,160 --> 00:14:40,400 Speaker 5: you're like making six or seven percent and trying to 294 00:14:40,400 --> 00:14:42,840 Speaker 5: tell people your sharp ratio is really good. You're gonna 295 00:14:42,880 --> 00:14:46,440 Speaker 5: make it if you find like and you concentrate and 296 00:14:46,440 --> 00:14:50,400 Speaker 5: you take leverage in a rising asset class and it's volatile, 297 00:14:50,440 --> 00:14:53,320 Speaker 5: and you you chase the dragon. And that was gold 298 00:14:53,400 --> 00:14:56,840 Speaker 5: back then. And I'd got gold because gold did nothing, okay, 299 00:14:57,040 --> 00:15:01,200 Speaker 5: but we'd had the NASDA crash stop markets had collapsed. 300 00:15:01,280 --> 00:15:03,320 Speaker 5: Gold had done nothing, And so when you look at 301 00:15:03,360 --> 00:15:06,280 Speaker 5: the relative performance of the two, Gold was saying, baby, 302 00:15:06,320 --> 00:15:09,720 Speaker 5: I'm coming by, and you know that, and that was good. 303 00:15:09,840 --> 00:15:13,280 Speaker 5: Why why was all this happening was happening because back then, 304 00:15:13,720 --> 00:15:18,280 Speaker 5: China was the size today of the Turkish economy. Yeah, 305 00:15:18,560 --> 00:15:22,480 Speaker 5: today is the size of the European economy. And the 306 00:15:22,520 --> 00:15:26,160 Speaker 5: markets and my prices were telling me that this long 307 00:15:26,280 --> 00:15:30,200 Speaker 5: journey was beginning to pick up base and their desire, 308 00:15:30,480 --> 00:15:33,760 Speaker 5: you know, like they laid down more concrete, They used 309 00:15:33,760 --> 00:15:36,640 Speaker 5: more steal, et cetera in like ten years than the 310 00:15:36,760 --> 00:15:39,440 Speaker 5: US economy did in the twentieth century. You know, it 311 00:15:39,520 --> 00:15:41,200 Speaker 5: was big, and that's what I was seeing, and I 312 00:15:41,280 --> 00:15:41,760 Speaker 5: was long in. 313 00:15:42,120 --> 00:15:45,800 Speaker 2: I understand, Like, Okay, you can point to specific commodities 314 00:15:46,160 --> 00:15:48,880 Speaker 2: like obviously copper and some of these old industry you 315 00:15:48,880 --> 00:15:52,400 Speaker 2: mentioned the smelters coming alive with the industrialization and rise 316 00:15:52,440 --> 00:15:54,760 Speaker 2: of the Chinese economy. Zoom at a little bit further, 317 00:15:54,800 --> 00:15:57,240 Speaker 2: because what you said is that China has been the 318 00:15:57,240 --> 00:16:00,000 Speaker 2: biggest story in asset markets period and that the incredible 319 00:16:00,160 --> 00:16:03,720 Speaker 2: rise and valuations and boom and ascid prices, it all, 320 00:16:03,960 --> 00:16:06,000 Speaker 2: in your views sort of come back to China. 321 00:16:06,160 --> 00:16:06,920 Speaker 4: How does that work? 322 00:16:07,320 --> 00:16:10,080 Speaker 5: Because it's a cheap charter. Sorry to say it, but 323 00:16:10,680 --> 00:16:13,160 Speaker 5: so you know, there's this thing that triff and dilemma. Yeah, 324 00:16:13,200 --> 00:16:15,840 Speaker 5: you know, they don't have an independent munchro policy. They've 325 00:16:15,920 --> 00:16:19,240 Speaker 5: kind of cut onto the coattails of the mighty US dollar, right, 326 00:16:19,440 --> 00:16:23,120 Speaker 5: they have a dirty float, they have a close capital account. Now, 327 00:16:23,280 --> 00:16:27,520 Speaker 5: so economics, which is a dire dollars subject, but economics 328 00:16:27,560 --> 00:16:31,320 Speaker 5: at its heart is really the investigation and the study 329 00:16:31,640 --> 00:16:35,120 Speaker 5: of how something in chaos kind of tries to return 330 00:16:35,440 --> 00:16:39,240 Speaker 5: and find equilibrium and clear. Yeah and so, and it 331 00:16:39,240 --> 00:16:40,760 Speaker 5: can be the opposite. It is an equilibrium and it's 332 00:16:40,760 --> 00:16:42,800 Speaker 5: going to pull apart, you know. And that's like what 333 00:16:42,880 --> 00:16:46,840 Speaker 5: people like me were kind of watching that and the rise. 334 00:16:46,920 --> 00:16:51,920 Speaker 5: They've done amazing things. Yeah, they've industrialized. Yeah, and the 335 00:16:52,040 --> 00:16:55,840 Speaker 5: reward in economics is you get richer for doing so 336 00:16:56,400 --> 00:16:59,360 Speaker 5: the benefits. And they've not done that. They've not now 337 00:16:59,720 --> 00:17:03,800 Speaker 5: and it's kind of like the frog, like boiling the frog. 338 00:17:03,840 --> 00:17:07,600 Speaker 5: And like we've warmed up the Chinese citizens, we brought 339 00:17:07,600 --> 00:17:11,760 Speaker 5: them into these conurbations. We've given them amazing factories. The 340 00:17:11,840 --> 00:17:14,560 Speaker 5: rise in productivity from taking someone off a field and 341 00:17:14,600 --> 00:17:18,240 Speaker 5: putting them in a semiconductive fab is insane. Yeah. And 342 00:17:18,320 --> 00:17:21,399 Speaker 5: so they're getting paid like ten x what their grandparents 343 00:17:21,440 --> 00:17:23,920 Speaker 5: got paid. They're like, hey, you know, this feels good. 344 00:17:24,160 --> 00:17:26,680 Speaker 5: The thing is they should be getting paid more. And 345 00:17:27,160 --> 00:17:30,480 Speaker 5: really where it should be represented is in the exchange rate. 346 00:17:30,560 --> 00:17:33,280 Speaker 5: The remember, forgive me, I call it the red cabbage. 347 00:17:33,280 --> 00:17:36,080 Speaker 5: You almost need a red cabbage. So the back when 348 00:17:36,119 --> 00:17:39,720 Speaker 5: we had the NAFTA agreement with Mexico and Canada, they 349 00:17:39,920 --> 00:17:43,920 Speaker 5: devalued their currency to six point three, and where's the 350 00:17:43,960 --> 00:17:46,600 Speaker 5: currency today versus the dollar? So you needed six point 351 00:17:46,640 --> 00:17:49,840 Speaker 5: three red cabbage and today you need like seven point three, 352 00:17:50,000 --> 00:17:52,320 Speaker 5: which is to say you need more red cabbage. So 353 00:17:52,359 --> 00:17:56,000 Speaker 5: they've got poorer now that that doesn't make sense, right, 354 00:17:56,040 --> 00:17:59,200 Speaker 5: And then you were talking about your anxiety. I'm here, 355 00:17:59,240 --> 00:18:01,440 Speaker 5: I've got a bill, I've had a chill pill for you. Okay, 356 00:18:01,560 --> 00:18:05,120 Speaker 5: because again, right, so we what we're seeing in ev right, 357 00:18:05,320 --> 00:18:08,000 Speaker 5: we saw it initially at the turn of this century. 358 00:18:08,000 --> 00:18:10,760 Speaker 5: Again back to my like my letters and stuff. Biggest 359 00:18:10,760 --> 00:18:14,199 Speaker 5: company in the world for a moment was Nokia. I 360 00:18:14,200 --> 00:18:17,160 Speaker 5: mean those kids like listening saying Nokia was Nokia? Right? 361 00:18:17,280 --> 00:18:19,520 Speaker 5: Nokia used to make televisions, and then they pivoted into 362 00:18:19,520 --> 00:18:21,840 Speaker 5: mobile phones, right. And then Apple of course came ba 363 00:18:22,040 --> 00:18:24,399 Speaker 5: at the turn of the century, biggest company on earth, 364 00:18:24,560 --> 00:18:28,119 Speaker 5: and you had ericson and these guys control you, your G, 365 00:18:28,359 --> 00:18:31,240 Speaker 5: your network, your five G, et cetera. Chinese came in 366 00:18:31,280 --> 00:18:33,840 Speaker 5: and said, wow, that's kind of dope. We want that, okay, 367 00:18:33,920 --> 00:18:35,280 Speaker 5: and now they own it and that's why you had 368 00:18:35,320 --> 00:18:35,560 Speaker 5: all that. 369 00:18:35,800 --> 00:18:38,640 Speaker 2: Yeah, how do you pronounce it's coming? 370 00:18:39,240 --> 00:18:41,960 Speaker 5: It's coming, it's coming, right, Okay? And if you look 371 00:18:42,000 --> 00:18:45,880 Speaker 5: at Ericson and Nochia today, those prices fell ninety five 372 00:18:45,920 --> 00:18:49,440 Speaker 5: percent and just they've stayed in the graveyard. Okay. Then 373 00:18:49,480 --> 00:18:51,679 Speaker 5: the Chinese came in, they said the same thing with solar, 374 00:18:52,119 --> 00:18:54,280 Speaker 5: and now they've come in and they've said the same 375 00:18:54,320 --> 00:18:56,960 Speaker 5: thing with ev What are they doing. They're saying, we 376 00:18:57,040 --> 00:19:01,200 Speaker 5: don't need to make money like we allocate in America 377 00:19:01,280 --> 00:19:05,119 Speaker 5: in the free world with the sharp jagged knife of 378 00:19:05,440 --> 00:19:07,520 Speaker 5: you got to make it if you want to. We 379 00:19:07,560 --> 00:19:09,760 Speaker 5: want to stay in the game. China doesn't. That's one 380 00:19:09,800 --> 00:19:14,919 Speaker 5: of the implicit subsidies. Now, so where where do we 381 00:19:14,920 --> 00:19:16,280 Speaker 5: see that? Where do we get that? I mean, maybe 382 00:19:16,280 --> 00:19:19,880 Speaker 5: that's just cute, okay, But what China does, it's very 383 00:19:19,880 --> 00:19:23,280 Speaker 5: good at creating GDP, but not wealth. So look at 384 00:19:23,280 --> 00:19:26,080 Speaker 5: the stock market, right the stock market's flat flat for 385 00:19:26,119 --> 00:19:29,840 Speaker 5: twenty five years, and the currencies is weakening. And that's 386 00:19:29,840 --> 00:19:32,359 Speaker 5: the problem. And so what happens is with our savings model, 387 00:19:32,720 --> 00:19:35,200 Speaker 5: all of it, all of it, and again, to maintain 388 00:19:35,280 --> 00:19:38,200 Speaker 5: those advantages, they have to push all of their capital 389 00:19:38,480 --> 00:19:43,280 Speaker 5: into risk free US treasuries. Okay, And unfortunately, only until 390 00:19:43,359 --> 00:19:47,960 Speaker 5: the last two three years the US we were fiscally conservative, 391 00:19:48,400 --> 00:19:51,040 Speaker 5: we should have been running huge deficits, but I was like, 392 00:19:51,080 --> 00:19:52,639 Speaker 5: oh no, you can't do that. We should have been 393 00:19:52,680 --> 00:19:55,280 Speaker 5: running huge deficits, and the Chinese would have funded the 394 00:19:55,359 --> 00:19:59,160 Speaker 5: role out of the best like fast trains, the best education, 395 00:19:59,600 --> 00:20:02,879 Speaker 5: the best healthcare, the best cities, you know, ships that 396 00:20:02,960 --> 00:20:06,120 Speaker 5: don't crash into bridges and bring it all tumbling down. 397 00:20:06,440 --> 00:20:08,719 Speaker 5: And instead, whenever we did something, we did a stupid 398 00:20:08,760 --> 00:20:11,919 Speaker 5: tax cut. And right at the very end of this process, 399 00:20:12,160 --> 00:20:16,120 Speaker 5: you're the Great Inflation Reduction Act, which is, hey, listen, 400 00:20:16,119 --> 00:20:19,320 Speaker 5: we're going to pay you money to bring great technology 401 00:20:19,359 --> 00:20:22,639 Speaker 5: and make it in the United States. That's working, and 402 00:20:22,680 --> 00:20:26,679 Speaker 5: so what's happening today, the fascination and the drama of 403 00:20:26,720 --> 00:20:30,560 Speaker 5: today is the fiscal policy is working and the US 404 00:20:30,600 --> 00:20:34,680 Speaker 5: has been transformed into the economic locomotive for the rest 405 00:20:34,720 --> 00:20:38,920 Speaker 5: of the world. Now, this dollar standard, the mighty dollar. 406 00:20:39,160 --> 00:20:42,919 Speaker 5: It was not conceived on the basis that the US 407 00:20:43,040 --> 00:20:45,639 Speaker 5: would be the chief. It wasn't conceived that the US 408 00:20:45,760 --> 00:20:48,080 Speaker 5: would be at five and a half percent, And the 409 00:20:48,160 --> 00:20:52,680 Speaker 5: ramifications of that are coming through the Japanese yet incredibly 410 00:20:52,760 --> 00:20:53,879 Speaker 5: has lost forty percent. 411 00:20:54,320 --> 00:20:56,320 Speaker 3: This is exactly what I wanted to ask you about, 412 00:20:56,359 --> 00:21:00,280 Speaker 3: which is just to add to Joe's anxiety, but be 413 00:21:00,359 --> 00:21:02,640 Speaker 3: panicking about a currency crisis right now? 414 00:21:03,240 --> 00:21:06,560 Speaker 5: Yeah, absolutely so, Like again, heaven is, We've got to 415 00:21:06,600 --> 00:21:09,720 Speaker 5: go back to nineteen ninety seven ninety eight, and we 416 00:21:09,800 --> 00:21:14,200 Speaker 5: had the Asian Sovereign Tiger crisis. Countries like Thailand they 417 00:21:14,200 --> 00:21:17,360 Speaker 5: had too many debts denominated in dollars and they had 418 00:21:17,359 --> 00:21:19,720 Speaker 5: to they had to default. I mean, they're currency fell 419 00:21:19,760 --> 00:21:22,359 Speaker 5: forty percent. Like the end, I mean, why no one's 420 00:21:22,400 --> 00:21:25,199 Speaker 5: talking about the move in the end is terrifying. And 421 00:21:25,280 --> 00:21:28,200 Speaker 5: through this period, the really what I wanted, like what 422 00:21:28,280 --> 00:21:30,199 Speaker 5: you're to concentrate on is at the end, it was 423 00:21:30,200 --> 00:21:33,320 Speaker 5: like an eighteen month period and at the end Taiwan 424 00:21:33,960 --> 00:21:38,920 Speaker 5: right now, Taiwan had no dollar borrowings really tightly like Singapore, 425 00:21:38,960 --> 00:21:43,920 Speaker 5: really well managed economy, and right at the end Taiwan devalued. 426 00:21:44,320 --> 00:21:48,160 Speaker 5: And everyone's like what what are you doing? And it's 427 00:21:48,200 --> 00:21:53,040 Speaker 5: the esorpient fable of the scorpion on the frog, like 428 00:21:53,280 --> 00:21:56,320 Speaker 5: he gets the frog's like I ain't taken. It's like no, no, no, 429 00:21:56,359 --> 00:21:58,360 Speaker 5: you're you're cool, You're cool. And they get halfway over 430 00:21:58,520 --> 00:22:01,040 Speaker 5: and the scorpion like zaps and it's like whoa what 431 00:22:01,160 --> 00:22:04,280 Speaker 5: year we talking about here, we're talking about nineteen ninety eight, okay, 432 00:22:04,280 --> 00:22:06,640 Speaker 5: in Taiwan, right, And so the point is that why 433 00:22:06,680 --> 00:22:07,760 Speaker 5: did Taiwan. 434 00:22:07,680 --> 00:22:09,520 Speaker 3: Devalue in its nature? 435 00:22:09,720 --> 00:22:12,400 Speaker 5: That's what they do. They weren't gonna leave a legacy 436 00:22:12,440 --> 00:22:15,560 Speaker 5: of their neighbors having devoured by forty percent. So the 437 00:22:15,640 --> 00:22:17,800 Speaker 5: big elephant in the room, and you touched upon it 438 00:22:17,840 --> 00:22:22,359 Speaker 5: in your intro, is what if the Chinese come around 439 00:22:22,359 --> 00:22:25,920 Speaker 5: and go boom and they devour you? Right, that would 440 00:22:25,960 --> 00:22:30,400 Speaker 5: be profe I would call that mad max deflation. Now, 441 00:22:30,800 --> 00:22:32,879 Speaker 5: one of the incentives for them to do it is 442 00:22:33,480 --> 00:22:36,520 Speaker 5: the quantitative easy in the United States. I actually think 443 00:22:36,520 --> 00:22:41,200 Speaker 5: it was sabotage for the Chinese because the very polite 444 00:22:41,280 --> 00:22:46,040 Speaker 5: request was listen, you gotta revowl. Your currency should be rising. 445 00:22:46,240 --> 00:22:48,160 Speaker 5: And why is that a good thing? Because one point 446 00:22:48,240 --> 00:22:50,840 Speaker 5: for bailing Chinese people will be richer visa via the 447 00:22:50,840 --> 00:22:53,640 Speaker 5: rest of the world, and they'll buy our things. You might, 448 00:22:53,720 --> 00:22:55,920 Speaker 5: I mean, the dreamliners may have some problems just now, 449 00:22:55,920 --> 00:22:58,280 Speaker 5: but they'll buy more, you know, and we'll work it out. 450 00:22:58,560 --> 00:23:01,240 Speaker 5: And the Chinese stubbornly used to do that. And so 451 00:23:01,280 --> 00:23:04,480 Speaker 5: if you can't revalue the external price, I think I 452 00:23:04,480 --> 00:23:07,480 Speaker 5: actually quantitative easing coming out of the States and elsewhere, 453 00:23:07,760 --> 00:23:11,960 Speaker 5: revaluate the acid prices domestically in China. And so now 454 00:23:12,320 --> 00:23:15,000 Speaker 5: did they prick the bubble. They've got the biggest dun 455 00:23:15,080 --> 00:23:17,919 Speaker 5: bubble of all time, sixty trillion dollar valuation, and what 456 00:23:17,960 --> 00:23:20,200 Speaker 5: do you do with that? It's a lot easier if 457 00:23:20,240 --> 00:23:24,120 Speaker 5: you devalue in dollars as opposed to the local currencies 458 00:23:24,359 --> 00:23:26,520 Speaker 5: that all the people feel like they're still the frogs 459 00:23:26,520 --> 00:23:27,120 Speaker 5: and the jacuzzi. 460 00:23:27,720 --> 00:23:31,840 Speaker 3: Joe, I remember this from do you remember Dick Beauvay. Oh, yeah, 461 00:23:31,840 --> 00:23:34,480 Speaker 3: the banking analyst. But he used to write about Qi 462 00:23:35,119 --> 00:23:38,440 Speaker 3: as a currency war. It's like an underappreciated currency war. 463 00:23:38,480 --> 00:23:40,800 Speaker 3: And this would have been in like twenty ten, twenty eleven. 464 00:23:40,840 --> 00:23:41,639 Speaker 3: I still remember that. 465 00:23:42,200 --> 00:23:45,480 Speaker 2: So let's take it to today, and I guess there 466 00:23:45,560 --> 00:23:48,800 Speaker 2: is still this anxiety out there of a Chinese devaluation. 467 00:23:49,520 --> 00:23:54,760 Speaker 2: We have seen them basically purposefully prick their own real 468 00:23:54,880 --> 00:23:57,720 Speaker 2: estate bubble, and there's been a lot less speculation that 469 00:23:57,760 --> 00:24:01,639 Speaker 2: seems like it's done. They're trying to The bet is 470 00:24:01,640 --> 00:24:03,920 Speaker 2: that they can sort of make up for that with 471 00:24:04,560 --> 00:24:08,280 Speaker 2: a lot of exports in advanced technologies, vehicles being the 472 00:24:08,280 --> 00:24:10,240 Speaker 2: one we talk a lot about these days, but that 473 00:24:10,400 --> 00:24:13,960 Speaker 2: basically it can be an industrial exporting powerhouse. And of 474 00:24:13,960 --> 00:24:17,160 Speaker 2: course you know people always talk have talked about Chinese exports, 475 00:24:17,440 --> 00:24:20,040 Speaker 2: but I think you know, the real growth driver was 476 00:24:20,119 --> 00:24:21,040 Speaker 2: domestic investment. 477 00:24:21,160 --> 00:24:23,480 Speaker 4: Now it feels like selling to the rest of the world. 478 00:24:23,680 --> 00:24:25,520 Speaker 4: What happens here? Can it work? 479 00:24:25,560 --> 00:24:28,560 Speaker 2: Can they make this pivot from a sort of inward investment, 480 00:24:28,640 --> 00:24:32,960 Speaker 2: real estate focused economy to one where exports really lift 481 00:24:33,000 --> 00:24:33,520 Speaker 2: everyone up. 482 00:24:34,560 --> 00:24:39,520 Speaker 5: No? No, And it's back to your anxiety. Right. The 483 00:24:39,720 --> 00:24:43,720 Speaker 5: biggest industry in Europe is automobiles. Yeah, yeah, And I 484 00:24:43,720 --> 00:24:46,000 Speaker 5: mean listen to ELI. It's like the Chinese where they are, 485 00:24:46,080 --> 00:24:49,199 Speaker 5: they wipe you out. You're gone, okay, right, So like 486 00:24:49,240 --> 00:24:50,880 Speaker 5: you think Europ's going to sit there and go, hey, 487 00:24:50,920 --> 00:24:53,879 Speaker 5: we're open, we're friendly. Common wipe is out right. That 488 00:24:53,960 --> 00:24:57,640 Speaker 5: avenue is over the proportion of exports to the Chinese economy, 489 00:24:57,760 --> 00:25:01,360 Speaker 5: the proportion of exports to the global g We're at 490 00:25:01,520 --> 00:25:04,919 Speaker 5: levels where it's intolerable for the rest of the world 491 00:25:04,920 --> 00:25:08,600 Speaker 5: to accept it. The bigger issue is, so here we are. 492 00:25:08,840 --> 00:25:11,240 Speaker 5: I mean, I've been invested for like thirty five years 493 00:25:11,440 --> 00:25:13,520 Speaker 5: and I'm saying to you, China going from the size 494 00:25:13,520 --> 00:25:16,359 Speaker 5: of Turkey to Europe, and the avalanche of money and 495 00:25:16,400 --> 00:25:20,320 Speaker 5: liquidity is why every asset price in America is high. 496 00:25:20,520 --> 00:25:23,600 Speaker 5: And I think we're now at the I call it 497 00:25:23,640 --> 00:25:26,680 Speaker 5: the o bay Yashi Maroo moment. If you remember from 498 00:25:26,720 --> 00:25:29,679 Speaker 5: Star Trek, when it's a no when it's a no 499 00:25:29,760 --> 00:25:33,000 Speaker 5: win scenario, there's no win because we got five and 500 00:25:33,000 --> 00:25:35,840 Speaker 5: a half percent rates in the US, We've got a 501 00:25:35,880 --> 00:25:38,360 Speaker 5: currency which is rising, and the rest of the world 502 00:25:38,440 --> 00:25:40,800 Speaker 5: is like, I'm out of here, I'm checking out. And 503 00:25:40,960 --> 00:25:43,040 Speaker 5: so the flow that is coming more and more into 504 00:25:43,080 --> 00:25:46,119 Speaker 5: the US. Now the FED sitting there and it's listening 505 00:25:46,200 --> 00:25:48,760 Speaker 5: to It's like the Bank of England in nineteen twenty 506 00:25:48,760 --> 00:25:50,920 Speaker 5: seven when they were like over vowed on the gold 507 00:25:50,960 --> 00:25:53,720 Speaker 5: standing like we're at four and I'm like, we're going 508 00:25:53,800 --> 00:25:56,000 Speaker 5: to be overthrown by the Communist unless we can bring 509 00:25:56,040 --> 00:25:58,000 Speaker 5: interest rates down. And so we went to the Fed 510 00:25:58,000 --> 00:26:00,400 Speaker 5: and he said, the only way we can bring down 511 00:26:00,680 --> 00:26:03,520 Speaker 5: is if you cut. Remember Benjamin Strong the cooped whiskey 512 00:26:03,760 --> 00:26:06,520 Speaker 5: and he takes a cut. And what happened. The US 513 00:26:06,560 --> 00:26:09,640 Speaker 5: stock market like went to the moon. It bred instability. 514 00:26:09,880 --> 00:26:14,480 Speaker 5: So the big drama this year is the Koreans, the Japanese, 515 00:26:14,520 --> 00:26:16,600 Speaker 5: and I think the Chinese are saying, you got to 516 00:26:16,840 --> 00:26:20,159 Speaker 5: you actually got to subjugate the domestic strength of the 517 00:26:20,280 --> 00:26:23,159 Speaker 5: US economy and you got to bail us out. Now 518 00:26:23,160 --> 00:26:25,320 Speaker 5: if the FED, that's a no win. If the FED 519 00:26:25,400 --> 00:26:29,280 Speaker 5: does that, like buy ten thousand call strikes on the SMB, 520 00:26:29,680 --> 00:26:31,880 Speaker 5: it's not gonna be there in two months. But that's 521 00:26:31,920 --> 00:26:35,200 Speaker 5: where it's going ahead really rapidly, because that's what happened 522 00:26:35,920 --> 00:26:39,240 Speaker 5: by I get back again to nineteen nineteen ninety eight. Yeah, 523 00:26:39,480 --> 00:26:43,240 Speaker 5: remember LTCM, So we had sovereign crisis. The US economy 524 00:26:43,280 --> 00:26:46,520 Speaker 5: in the third quarter of twenty nineteen ninety eight grew 525 00:26:46,560 --> 00:26:49,160 Speaker 5: at five point six percent, and what did the FED do? 526 00:26:49,200 --> 00:26:52,520 Speaker 5: They cut rays and people are like, you guys are clowns. Okay, 527 00:26:52,520 --> 00:26:55,280 Speaker 5: I'm buying stocks, and stocks again went to the moon. 528 00:26:55,359 --> 00:26:59,520 Speaker 5: We're at a point where if the FED, so I 529 00:26:59,520 --> 00:27:03,199 Speaker 5: think the FED actually Fed only ever cuts when something breaks, 530 00:27:03,720 --> 00:27:06,240 Speaker 5: and the rest of us saying, we're kind of at 531 00:27:06,280 --> 00:27:10,119 Speaker 5: that point. Okay, So if the if something breaks, the 532 00:27:10,119 --> 00:27:12,119 Speaker 5: Fed's cutting is going to subjugate the strength of the 533 00:27:12,240 --> 00:27:16,040 Speaker 5: United States economy like the interests of it and asset 534 00:27:16,080 --> 00:27:22,119 Speaker 5: prices will become intoxicatingly like at levels. We've got to remember, 535 00:27:22,640 --> 00:27:25,320 Speaker 5: trees grow tall, but they don't grow to the sky, 536 00:27:25,520 --> 00:27:26,800 Speaker 5: and we're getting close to the sky. 537 00:27:27,520 --> 00:27:31,560 Speaker 3: Why doesn't China try to boost domestic consumption if the 538 00:27:31,600 --> 00:27:33,479 Speaker 3: rest of the world is like closed off to it, 539 00:27:33,520 --> 00:27:36,840 Speaker 3: Why is it still so focused it seems on manufacturing, 540 00:27:36,840 --> 00:27:39,800 Speaker 3: even though it's moving from you know, manufacturing TVs or 541 00:27:39,840 --> 00:27:41,200 Speaker 3: whatever to semiconductors. 542 00:27:41,840 --> 00:27:46,200 Speaker 5: Yeah, I mean, you know, I wish to remain polite, 543 00:27:46,240 --> 00:27:51,280 Speaker 5: but it's it's not a democracy, you know, the civil 544 00:27:51,320 --> 00:27:53,360 Speaker 5: liberties are I mean, you know, I don't think as 545 00:27:53,400 --> 00:27:55,520 Speaker 5: a contentious thing. You don't really have much in the 546 00:27:55,520 --> 00:27:58,560 Speaker 5: way of civil liberties. Again the quid pro cause, look 547 00:27:58,600 --> 00:28:01,280 Speaker 5: at your life. You're so much richer than your grandparents, 548 00:28:01,440 --> 00:28:03,800 Speaker 5: and we just asked for a bit of talmerance. Like 549 00:28:04,440 --> 00:28:06,960 Speaker 5: so you were saying again your anxiety about the Chinese 550 00:28:07,000 --> 00:28:10,520 Speaker 5: and they're going to overtake us. They took the wrong bet. Yeah, 551 00:28:10,560 --> 00:28:12,399 Speaker 5: because I was talking to someone like but what about 552 00:28:12,400 --> 00:28:17,080 Speaker 5: the Chinese? Thousands upon thousands of PhDs, I'm like, yeah, Like, 553 00:28:17,359 --> 00:28:19,880 Speaker 5: I'm sorry again, forgive me, but if you just completed 554 00:28:19,880 --> 00:28:23,280 Speaker 5: a PhD, my god, you just chose the wrong moment 555 00:28:23,320 --> 00:28:28,000 Speaker 5: in history. Why because we got AI, we got the 556 00:28:28,040 --> 00:28:31,400 Speaker 5: AI and the PhD thing, by laws is the left 557 00:28:31,440 --> 00:28:34,160 Speaker 5: hemisphere of your brain. If you're listening to this now 558 00:28:34,440 --> 00:28:36,480 Speaker 5: the future, and if you want to be rewarded again, 559 00:28:36,520 --> 00:28:38,400 Speaker 5: you've got to be kind of like an acid capitalist 560 00:28:38,600 --> 00:28:41,440 Speaker 5: is right hand side of the brain. All that PhD 561 00:28:41,520 --> 00:28:43,080 Speaker 5: thing has been made redundant. 562 00:28:43,520 --> 00:28:44,280 Speaker 4: But they had hurt. 563 00:28:44,320 --> 00:28:46,600 Speaker 2: The AI companies all have to hire PhDs, so some 564 00:28:46,640 --> 00:28:47,320 Speaker 2: of them get jobs. 565 00:28:47,440 --> 00:28:49,680 Speaker 5: Now now they just they invest in more. AI has 566 00:28:49,720 --> 00:28:51,200 Speaker 5: become circular like PhDs. 567 00:28:52,200 --> 00:28:55,160 Speaker 2: I talked to a founder this week, basically Tracy by 568 00:28:55,160 --> 00:28:58,200 Speaker 2: the way, who says that all code will be written 569 00:28:58,240 --> 00:29:17,480 Speaker 2: by a let's talk more about this idea. Okay, the 570 00:29:17,560 --> 00:29:21,120 Speaker 2: FED is not going to cut until something breaks. You 571 00:29:21,160 --> 00:29:23,200 Speaker 2: think the thing that will break will not be like 572 00:29:23,240 --> 00:29:25,920 Speaker 2: a domestic thing, but will be like on the international front, 573 00:29:25,960 --> 00:29:27,920 Speaker 2: walgust through like where we're at risk. 574 00:29:28,080 --> 00:29:32,640 Speaker 3: Because a year ago the thing that was. 575 00:29:32,440 --> 00:29:37,360 Speaker 5: I mean, it ain't gone away. Yeah, extend and pretend 576 00:29:37,400 --> 00:29:39,720 Speaker 5: and all that thing. So I mean, you know, not 577 00:29:39,760 --> 00:29:42,200 Speaker 5: wishing to name and chane, but an organization like Bank 578 00:29:42,240 --> 00:29:45,840 Speaker 5: of America you know, has and like like a peer 579 00:29:45,840 --> 00:29:49,520 Speaker 5: group has an enormous treasury portfolio, which it doesn't mark 580 00:29:49,560 --> 00:29:52,480 Speaker 5: to market, and that is an inducement by the US 581 00:29:52,520 --> 00:29:56,520 Speaker 5: Treasury to ensure that people are there to buy the treasuries. Okay, 582 00:29:56,920 --> 00:30:01,800 Speaker 5: and so they've got they've got unmarked losses right which 583 00:30:02,520 --> 00:30:06,680 Speaker 5: are this are the same magnitude as their equity. Okay, now, 584 00:30:07,240 --> 00:30:09,160 Speaker 5: and where we are just now is that we started 585 00:30:09,160 --> 00:30:10,880 Speaker 5: this year and we were going to get four, five, 586 00:30:10,920 --> 00:30:13,680 Speaker 5: six interest rate cuts. And when you get that, the 587 00:30:13,720 --> 00:30:15,720 Speaker 5: bonds normally kind of come off their ass and kind 588 00:30:15,720 --> 00:30:20,160 Speaker 5: of rise and value and like their viability gets better. Okay, 589 00:30:20,400 --> 00:30:23,880 Speaker 5: that ain't happened. If anything, you're the domestic consying, we 590 00:30:23,880 --> 00:30:26,959 Speaker 5: need higher interest rates. Where's where's the tenure today? Like 591 00:30:27,040 --> 00:30:28,560 Speaker 5: it was four and a half, we were heading close 592 00:30:28,600 --> 00:30:32,360 Speaker 5: to to five before the weaker GDP statistics comes out, 593 00:30:32,440 --> 00:30:36,480 Speaker 5: So that's still there. There's fragility there four point four two. 594 00:30:36,840 --> 00:30:40,040 Speaker 5: And look when we get backhuntings. I mean, if we've 595 00:30:40,080 --> 00:30:42,160 Speaker 5: got any banking analysts listened to this, can you do 596 00:30:42,200 --> 00:30:45,640 Speaker 5: your job like rather than it's blowing smoke up the CEO, 597 00:30:45,880 --> 00:30:47,760 Speaker 5: can you say, hey, listen, can you tell me what 598 00:30:47,880 --> 00:30:51,040 Speaker 5: is the size of your unmarked treasury portfolio. What is 599 00:30:51,080 --> 00:30:53,080 Speaker 5: the loss of it? What are you doing if you 600 00:30:53,120 --> 00:30:55,760 Speaker 5: shifted the duration? Can you just talk to the street 601 00:30:55,800 --> 00:30:59,320 Speaker 5: about it? No one asks, no one Like bad news 602 00:30:59,360 --> 00:31:02,120 Speaker 5: comes out you really really, it comes out really really slow, 603 00:31:02,160 --> 00:31:04,520 Speaker 5: and then it stings you. Let's let's ask the questions. 604 00:31:04,520 --> 00:31:06,880 Speaker 5: So that's there, that's out there. 605 00:31:06,960 --> 00:31:10,720 Speaker 3: But okay, just on the bank, So what when when 606 00:31:10,760 --> 00:31:13,520 Speaker 3: we say that, Okay, if you marked the bonds to market, 607 00:31:13,640 --> 00:31:16,360 Speaker 3: it would just blow a massive hole in banks equity. 608 00:31:16,560 --> 00:31:19,320 Speaker 3: That is terrifying on the one hand, But on the 609 00:31:19,320 --> 00:31:21,600 Speaker 3: other hand, part of me is like I find it 610 00:31:21,840 --> 00:31:25,920 Speaker 3: hard to believe that the banking system is going to 611 00:31:25,960 --> 00:31:29,280 Speaker 3: be ruined by investing into many US treasuries. 612 00:31:31,600 --> 00:31:34,960 Speaker 5: Okay, I mean what is that? Just is a blind faith? 613 00:31:35,040 --> 00:31:36,680 Speaker 5: I mean the numbers are like really big. 614 00:31:36,840 --> 00:31:40,680 Speaker 3: I guess it's blind relativism. It's like US treasuries are 615 00:31:41,040 --> 00:31:45,360 Speaker 3: the safest asset out there then until they're not. 616 00:31:45,480 --> 00:31:48,320 Speaker 5: This is true, So I tell you, So what we're 617 00:31:48,320 --> 00:31:52,520 Speaker 5: doing is we're flying high without a safety net. Okay, 618 00:31:52,760 --> 00:31:56,120 Speaker 5: so we've we've been there. We had the again, I 619 00:31:56,120 --> 00:32:00,200 Speaker 5: can't believe this is happening. The entire global bank king 620 00:32:00,280 --> 00:32:04,520 Speaker 5: universe went bankrupt. In two thousand and eight, they were 621 00:32:04,680 --> 00:32:09,800 Speaker 5: gone gone, right, but the US Treasury was it like 622 00:32:09,840 --> 00:32:12,080 Speaker 5: sixty percent debt to GDP and these they stood in 623 00:32:12,400 --> 00:32:14,239 Speaker 5: and like, you know what, we got it all right, 624 00:32:14,240 --> 00:32:17,440 Speaker 5: We're gonna we've got these fun tokens. We're gonna issue 625 00:32:17,480 --> 00:32:20,280 Speaker 5: lots of these fun tokens, and you're gonna come back. Okay, 626 00:32:20,440 --> 00:32:23,320 Speaker 5: what happens? And that was your safety net. Where's the 627 00:32:23,360 --> 00:32:26,800 Speaker 5: safety net now? Like if they tried that that maneuver again, 628 00:32:27,080 --> 00:32:30,040 Speaker 5: people like me, people like get out of here. We're 629 00:32:30,920 --> 00:32:34,000 Speaker 5: we're getting out of like we're not owning these silly 630 00:32:34,200 --> 00:32:37,920 Speaker 5: securities because you're tapped out. Like so the US Treasury 631 00:32:38,040 --> 00:32:41,320 Speaker 5: now is not the safety net. If there is folly 632 00:32:41,600 --> 00:32:43,880 Speaker 5: and if there was an incident in the financial sector, 633 00:32:44,160 --> 00:32:46,720 Speaker 5: it's top tout. It doesn't have the resource. So we're 634 00:32:46,720 --> 00:32:50,640 Speaker 5: on our on That's scary. And so again that's why 635 00:32:51,200 --> 00:32:53,760 Speaker 5: the next move for people is to consider, well, what 636 00:32:53,800 --> 00:32:56,680 Speaker 5: if they what if they cut and they have to 637 00:32:56,760 --> 00:33:00,280 Speaker 5: I actually think it could get so bad that we 638 00:33:00,360 --> 00:33:03,680 Speaker 5: will go back to the notion of zero interest rates. 639 00:33:04,240 --> 00:33:07,160 Speaker 5: And I think that treasuries, I mean, I've been so 640 00:33:07,240 --> 00:33:10,480 Speaker 5: hideously bad. I've been owning leaps on the TLT. The 641 00:33:10,520 --> 00:33:13,560 Speaker 5: long duration now leaps options. Like if I got a 642 00:33:13,640 --> 00:33:17,000 Speaker 5: million dollar portfolio, I've been spending like fifty thousand dollars 643 00:33:17,120 --> 00:33:19,240 Speaker 5: and then topping it up as I lose money on them, 644 00:33:19,280 --> 00:33:21,600 Speaker 5: and just keeping a lot of time on it. So 645 00:33:21,600 --> 00:33:24,920 Speaker 5: I've probably spent a tenth of my portfolio. You know, 646 00:33:25,280 --> 00:33:29,080 Speaker 5: I'm underwater, but I own that because I think we're 647 00:33:29,120 --> 00:33:32,960 Speaker 5: at the end of the most incredible bill market and treasuries, 648 00:33:32,960 --> 00:33:36,960 Speaker 5: which again absolutely coincided with China and who came in 649 00:33:37,000 --> 00:33:40,000 Speaker 5: to preserve their currency and believe it undervoured. They had 650 00:33:40,000 --> 00:33:42,760 Speaker 5: to put money into risk grey US treasuries and they 651 00:33:42,800 --> 00:33:46,480 Speaker 5: bid it higher. Okay, but the booll market and treasuries, 652 00:33:46,760 --> 00:33:49,560 Speaker 5: it was a double bottom in price terms between nineteen 653 00:33:49,600 --> 00:33:51,600 Speaker 5: eighty two and nineteen eighty four. If we put it 654 00:33:51,760 --> 00:33:55,400 Speaker 5: into yield perspectives, the ten year peaked at sixteen percent. 655 00:33:55,680 --> 00:33:58,720 Speaker 5: But in nineteen eighty four, as the economy came back, 656 00:33:58,960 --> 00:34:01,680 Speaker 5: I found vigor. You went you you know the notion 657 00:34:01,840 --> 00:34:05,840 Speaker 5: recency biases bisis. So the recency biases was strong economy, 658 00:34:05,880 --> 00:34:08,560 Speaker 5: inflation and people sold the bones again. So in nineteen 659 00:34:08,600 --> 00:34:11,879 Speaker 5: eighty four years peaked at fourteen and then that was it, 660 00:34:11,960 --> 00:34:13,799 Speaker 5: you know, and of course they went to where they 661 00:34:13,800 --> 00:34:16,719 Speaker 5: went to, like forty basis points during the COVID. I 662 00:34:16,800 --> 00:34:20,160 Speaker 5: think the end of this boom market is in the 663 00:34:20,200 --> 00:34:25,000 Speaker 5: next eighteen months, and I think the treasuries, I don't 664 00:34:25,000 --> 00:34:27,560 Speaker 5: think they'll yield forty basis points, but I think they 665 00:34:27,600 --> 00:34:29,680 Speaker 5: could get down to like one point two one point 666 00:34:29,719 --> 00:34:32,080 Speaker 5: five years and that and then that's like and then 667 00:34:32,160 --> 00:34:34,720 Speaker 5: sell them and get out, because we'll have to redraw 668 00:34:34,760 --> 00:34:36,880 Speaker 5: and we'll have to examine and try and create a 669 00:34:36,920 --> 00:34:37,839 Speaker 5: new monetary order. 670 00:34:39,040 --> 00:34:39,520 Speaker 4: Exciting. 671 00:34:39,560 --> 00:34:41,640 Speaker 2: I'm sure we'll have plenty of good episodes about that 672 00:34:41,760 --> 00:34:43,120 Speaker 2: redrawing of the monetary order. 673 00:34:43,320 --> 00:34:45,560 Speaker 4: Back to China. Didn't all those. 674 00:34:45,440 --> 00:34:47,799 Speaker 2: Ghost cities that you toured and showed on YouTube end 675 00:34:47,880 --> 00:34:49,880 Speaker 2: up getting filled? Because I feel like now there's one 676 00:34:49,960 --> 00:34:52,960 Speaker 2: hundred what they call Tier two and Tier three cities 677 00:34:52,960 --> 00:34:55,239 Speaker 2: that none of us know the names of that have 678 00:34:55,320 --> 00:34:58,960 Speaker 2: like ten million people and with glstening subway systems and 679 00:34:59,080 --> 00:35:02,160 Speaker 2: whatever else, like in your view, what happened to those 680 00:35:02,280 --> 00:35:03,280 Speaker 2: what happened to those cities? 681 00:35:03,800 --> 00:35:09,560 Speaker 5: Thank you for that? Because I was dead wrong okay, wrong, wrong, right? 682 00:35:09,640 --> 00:35:12,560 Speaker 5: But can I tell you why? So? I like you 683 00:35:12,560 --> 00:35:16,319 Speaker 5: get value investors, growth investors. I'm a time investor, would 684 00:35:16,360 --> 00:35:19,839 Speaker 5: you believe? Okay? And I it was only really very 685 00:35:19,880 --> 00:35:24,560 Speaker 5: recently I came to understand the Chinese like what do 686 00:35:24,640 --> 00:35:27,480 Speaker 5: you call it? Like your horoscope and like the pursuit 687 00:35:27,520 --> 00:35:30,759 Speaker 5: and the investigation of heavenly bodies around the sun, right, 688 00:35:30,920 --> 00:35:33,720 Speaker 5: you like like Pisces and all that kind of stuff 689 00:35:33,840 --> 00:35:37,000 Speaker 5: we use. We use the rotation of the ass rotation 690 00:35:37,080 --> 00:35:39,239 Speaker 5: around the sun. Ya. Yeah, and I believe that takes 691 00:35:39,239 --> 00:35:39,680 Speaker 5: a year. 692 00:35:41,239 --> 00:35:44,040 Speaker 4: Twelve years. There you go, that's a very I hadn't heard. 693 00:35:44,080 --> 00:35:45,560 Speaker 4: That's a very good like men. 694 00:35:45,840 --> 00:35:47,680 Speaker 3: You have heard that before because we talked about this 695 00:35:47,760 --> 00:35:49,680 Speaker 3: exactly the last. 696 00:35:50,080 --> 00:35:51,560 Speaker 4: Yeah, but no, that's a good one. 697 00:35:51,600 --> 00:35:54,040 Speaker 5: It is. And then like so when I was peak 698 00:35:54,880 --> 00:35:59,920 Speaker 5: peak bearish, I was twelve years out literally it was 699 00:36:00,040 --> 00:36:03,239 Speaker 5: twenty eleven. I launched a credit for I'd have made 700 00:36:03,239 --> 00:36:07,319 Speaker 5: a billion box, a billion box if I had been 701 00:36:07,320 --> 00:36:11,400 Speaker 5: twelve years in the future. You know, So I was wrong, 702 00:36:11,480 --> 00:36:13,400 Speaker 5: But I want to tell you my time piece was 703 00:36:13,440 --> 00:36:15,880 Speaker 5: twelve years out. Okay, and the time is now. 704 00:36:16,560 --> 00:36:18,080 Speaker 3: When was the last time you were in China? 705 00:36:18,680 --> 00:36:20,120 Speaker 5: I ain't rushing to go back to China. 706 00:36:20,160 --> 00:36:21,880 Speaker 3: Yeah, well, I was kind of curious if you've been 707 00:36:21,920 --> 00:36:24,799 Speaker 3: back recently seen some of the changes, or. 708 00:36:24,760 --> 00:36:26,719 Speaker 5: I've been invited by some funky people to go to 709 00:36:26,960 --> 00:36:30,839 Speaker 5: Mongolia and August. I would go August, but I think 710 00:36:30,880 --> 00:36:36,080 Speaker 5: I'd rather be an Ibitha. But you know, yeah, so 711 00:36:36,160 --> 00:36:38,560 Speaker 5: my last I tell you in terms of again formative 712 00:36:38,680 --> 00:36:41,680 Speaker 5: and with the investment letters mark not the last time. 713 00:36:41,719 --> 00:36:44,760 Speaker 5: But March two thousand and eight, I took a slow 714 00:36:44,880 --> 00:36:50,000 Speaker 5: train from Wuhang to Beijing. It was quite grim. 715 00:36:50,000 --> 00:36:51,839 Speaker 3: Not the high speed trend, No, it was. 716 00:36:51,880 --> 00:36:55,600 Speaker 5: Really quite I liked struggling slow. It was really grim. 717 00:36:55,800 --> 00:36:58,719 Speaker 5: I should have been buying the S and P. The 718 00:36:58,800 --> 00:37:01,279 Speaker 5: S and P had fallen sixty five percent in March 719 00:37:01,320 --> 00:37:04,360 Speaker 5: two thousand and nine, and instead I was and you know, 720 00:37:04,520 --> 00:37:06,880 Speaker 5: and Wuhan, where was I am Muhan. I was in 721 00:37:06,920 --> 00:37:10,400 Speaker 5: the wet market where the whole COVID thing. I should 722 00:37:10,400 --> 00:37:11,400 Speaker 5: have been buying the SVP. 723 00:37:12,360 --> 00:37:14,799 Speaker 2: Just in general, I mean, I am struck by this 724 00:37:14,960 --> 00:37:17,880 Speaker 2: fact that like we hear all these different people and 725 00:37:17,960 --> 00:37:23,360 Speaker 2: it's like diversification and international stocks and all this stuff 726 00:37:23,400 --> 00:37:24,400 Speaker 2: and exotic things. 727 00:37:24,600 --> 00:37:26,240 Speaker 4: In the end, we should have just all been buying 728 00:37:26,239 --> 00:37:28,440 Speaker 4: the S and P had like gone and lived our lives. 729 00:37:28,200 --> 00:37:32,200 Speaker 5: Right, absolutely, and like they're still peddling emerging Marcus, Like, 730 00:37:32,719 --> 00:37:35,120 Speaker 5: how many? How many years does it work? 731 00:37:35,280 --> 00:37:37,240 Speaker 4: I am curious because there's been a ton of growth 732 00:37:37,280 --> 00:37:39,799 Speaker 4: over since. And this is always the thing. It's like, 733 00:37:39,800 --> 00:37:41,080 Speaker 4: there's a lot of growth everywhere. 734 00:37:41,200 --> 00:37:45,280 Speaker 2: What has been the fatal flaw of the international diversification 735 00:37:45,360 --> 00:37:47,960 Speaker 2: slash em thesis that has been very popular and people 736 00:37:48,000 --> 00:37:50,200 Speaker 2: are always repackaging and reselling. 737 00:37:50,040 --> 00:37:51,799 Speaker 5: Again, I think it's my accent. You know you're not 738 00:37:51,880 --> 00:37:56,320 Speaker 5: hearing me. They are not They are magnificent. These countries 739 00:37:56,440 --> 00:38:00,759 Speaker 5: are magnificent at creating GDP growth, hm, right, incredible, right, 740 00:38:01,040 --> 00:38:04,319 Speaker 5: But it's GDP growth at the expense of wealth, right, 741 00:38:04,360 --> 00:38:07,080 Speaker 5: So let me get So, Let's say we've got a bridge. 742 00:38:07,160 --> 00:38:09,080 Speaker 5: It's going to cost us a billion dollars. We're going 743 00:38:09,120 --> 00:38:12,200 Speaker 5: to link to communities. And let's say it's in America 744 00:38:12,320 --> 00:38:14,799 Speaker 5: and there's like and it's in the Bay Area, and 745 00:38:14,840 --> 00:38:17,239 Speaker 5: the average per capital income of the two cities is 746 00:38:17,239 --> 00:38:19,640 Speaker 5: one hundred and fifty thousand dollars, right, and so and 747 00:38:19,680 --> 00:38:22,640 Speaker 5: you're going to cut like fifteen twenty minutes in the 748 00:38:22,719 --> 00:38:25,680 Speaker 5: daily commute of all those people, people with that level 749 00:38:25,680 --> 00:38:29,160 Speaker 5: of wealth cutting time is good, it's productive, it's going 750 00:38:29,239 --> 00:38:32,400 Speaker 5: to add utility to their lives. Okay, And it's got 751 00:38:32,200 --> 00:38:36,400 Speaker 5: a it's an NPV positive, it has net present value. Okay. 752 00:38:36,560 --> 00:38:39,960 Speaker 5: So the value of the billion that you spend maybe 753 00:38:39,960 --> 00:38:42,640 Speaker 5: it's maybe it's two billion. Okay. Now, if you join 754 00:38:42,760 --> 00:38:46,040 Speaker 5: up two Chinese communities and the average per capital consumption 755 00:38:46,120 --> 00:38:48,520 Speaker 5: is eight thousand dollars, if you're on eight thousand dollars, 756 00:38:48,560 --> 00:38:50,680 Speaker 5: you ain't in a hurry. You ain't in a hurry, right, 757 00:38:50,760 --> 00:38:53,799 Speaker 5: But you spend a billion, and what happens is you've 758 00:38:53,840 --> 00:38:57,440 Speaker 5: not created wealth. So the if you were, if you 759 00:38:57,520 --> 00:38:59,840 Speaker 5: actually had, if you were a corporation, you'd have to 760 00:39:00,120 --> 00:39:02,840 Speaker 5: market because let's say you're taking a you're taking a token, 761 00:39:02,920 --> 00:39:05,560 Speaker 5: it's a toll bridge, okay, And you do the DCF, 762 00:39:05,680 --> 00:39:08,440 Speaker 5: you're going to quickly work out that your MPV is 763 00:39:08,480 --> 00:39:11,000 Speaker 5: like half a billion, so you're in a half a 764 00:39:11,000 --> 00:39:14,440 Speaker 5: billion deficit. That the half a billion deficit doesn't get 765 00:39:14,480 --> 00:39:17,840 Speaker 5: measured in GDP. You measure the billion. And so this 766 00:39:17,960 --> 00:39:21,920 Speaker 5: is why the strategy doesn't work because sure you get GDP, 767 00:39:22,920 --> 00:39:25,480 Speaker 5: but where's the stock market? Right? And where's the stock 768 00:39:25,520 --> 00:39:28,240 Speaker 5: market in America? Because what do we do. We actually 769 00:39:28,239 --> 00:39:31,440 Speaker 5: go hey re'ch on on capital pause the MPV. We're 770 00:39:31,480 --> 00:39:33,440 Speaker 5: in it to win it, right, and so we get 771 00:39:33,520 --> 00:39:36,600 Speaker 5: less GDP, but we get the best stocks and the 772 00:39:36,600 --> 00:39:38,879 Speaker 5: best stock market. That's the fundamental flaw. 773 00:39:40,200 --> 00:39:42,759 Speaker 3: So one of the reasons we enjoy talking to you 774 00:39:42,880 --> 00:39:46,560 Speaker 3: is because we get to live vicariously and pretend that 775 00:39:46,600 --> 00:39:49,520 Speaker 3: we're talking Macro on a beach in Saint Bart's instead 776 00:39:49,520 --> 00:39:52,400 Speaker 3: of talking Macro in an office in midtown. And you've 777 00:39:52,440 --> 00:39:54,480 Speaker 3: been in St. Bart's for many, many years now, and 778 00:39:54,520 --> 00:39:57,880 Speaker 3: I'm curious what changes have you seen over the years. 779 00:39:58,040 --> 00:39:59,600 Speaker 3: And one of the reasons I ask is because I 780 00:39:59,600 --> 00:40:02,000 Speaker 3: went to this, say Shells, which is on the other 781 00:40:02,040 --> 00:40:03,760 Speaker 3: side of the world, but I guess it is a beach. 782 00:40:04,160 --> 00:40:06,160 Speaker 3: And I went to the Seychelles last year. I was 783 00:40:06,200 --> 00:40:08,840 Speaker 3: kind of surprised by like the number of Russians that 784 00:40:08,920 --> 00:40:12,960 Speaker 3: I saw there, Just so much Russian money and coming 785 00:40:12,960 --> 00:40:15,560 Speaker 3: from the US economy at a time when you know, 786 00:40:15,600 --> 00:40:18,920 Speaker 3: it was all about sanctions, all about European energy crisis, 787 00:40:18,960 --> 00:40:20,640 Speaker 3: things like that. It was kind of surprising to me 788 00:40:20,840 --> 00:40:22,759 Speaker 3: to see that level of wealth externally. 789 00:40:23,280 --> 00:40:26,560 Speaker 5: Well, I mean, you know that Paul McCartney wings is 790 00:40:26,840 --> 00:40:28,920 Speaker 5: banned on the run. I mean it's the Russians on 791 00:40:28,960 --> 00:40:31,760 Speaker 5: the run. Yeah, I mean they're fleeing go to Dubai. 792 00:40:31,840 --> 00:40:33,839 Speaker 5: And it's the same thing. You know. I tell from 793 00:40:33,920 --> 00:40:35,640 Speaker 5: the beginning when I was writing those letters, like you 794 00:40:35,640 --> 00:40:37,920 Speaker 5: want to solve Russia because that's the time of the 795 00:40:38,200 --> 00:40:40,480 Speaker 5: emerages of the Oligarks, I was like, you want to 796 00:40:40,520 --> 00:40:42,920 Speaker 5: solve Russia, you want to bring freedom. I mean, it's 797 00:40:42,960 --> 00:40:44,960 Speaker 5: not for us to solve Russias, for them to solve it, right, 798 00:40:45,239 --> 00:40:48,279 Speaker 5: but if we want to stop them and pinging and 799 00:40:48,360 --> 00:40:51,719 Speaker 5: being annoying, being noisy neighbors, the number one thing you 800 00:40:51,760 --> 00:40:54,960 Speaker 5: do is you say, all the rich oligarchs, no visus. 801 00:40:55,040 --> 00:40:57,160 Speaker 5: You can't come to same Bars. You can't go to Seychelles, 802 00:40:57,320 --> 00:41:00,840 Speaker 5: you can't go skiing in the Swiss Alps. Were in America, enjoy, 803 00:41:01,120 --> 00:41:03,880 Speaker 5: enjoy the motherland. Okay, talk to the boss. I mean 804 00:41:03,880 --> 00:41:05,680 Speaker 5: you sort it out. You know what, We'll look at 805 00:41:05,719 --> 00:41:08,239 Speaker 5: your visit again. And that's so they do. They can't 806 00:41:08,280 --> 00:41:10,640 Speaker 5: come to they can't come I'm gonna say they can't 807 00:41:10,640 --> 00:41:12,800 Speaker 5: come to same Boss. But actually I'm thinking my my 808 00:41:12,920 --> 00:41:16,080 Speaker 5: Christmas client actually is Russian. So some of them can 809 00:41:16,120 --> 00:41:19,279 Speaker 5: get in, but Abramovich he came in and he laid 810 00:41:19,280 --> 00:41:22,520 Speaker 5: down eighty million dollars in two in February two thousand 811 00:41:22,560 --> 00:41:25,000 Speaker 5: and eight, and didn't put the same boss on the map. 812 00:41:25,040 --> 00:41:28,319 Speaker 5: But you know that was like a huge investment, and 813 00:41:29,280 --> 00:41:31,840 Speaker 5: property prices are absord you know, really absurd. I just 814 00:41:31,840 --> 00:41:34,200 Speaker 5: got divorced and I had to do evaluation on the 815 00:41:34,320 --> 00:41:36,960 Speaker 5: on the Portfolium. I mean, it's just it's insane. Same 816 00:41:37,000 --> 00:41:39,600 Speaker 5: bars is kind of like Bobby Digital. I just forgive me. 817 00:41:39,800 --> 00:41:44,280 Speaker 5: I call bitcoin Bobby Digital. It's goots, not a Bobby 818 00:41:44,400 --> 00:41:45,160 Speaker 5: brother or something. 819 00:41:45,640 --> 00:41:47,759 Speaker 2: What is you know, One of the things and we've 820 00:41:47,760 --> 00:41:49,759 Speaker 2: talked about it a little bit on the show, is 821 00:41:49,880 --> 00:41:55,600 Speaker 2: like the extreme concentration of ultra wealth in places like Dubai, Miami, 822 00:41:55,640 --> 00:41:56,120 Speaker 2: et cetera. 823 00:41:56,360 --> 00:41:59,040 Speaker 4: Like what is driving is it? 824 00:41:59,360 --> 00:42:01,440 Speaker 2: I mean I sort of get it from the Russian perspective, 825 00:42:01,480 --> 00:42:03,279 Speaker 2: wanting to get money out of the country being on 826 00:42:03,320 --> 00:42:05,520 Speaker 2: the run. As you put in, what do you think, 827 00:42:05,560 --> 00:42:08,120 Speaker 2: like what is the source of anxiety among the ultra 828 00:42:08,200 --> 00:42:10,880 Speaker 2: wealthy that they're you know that they congregate in cities 829 00:42:10,960 --> 00:42:13,880 Speaker 2: like Dubai or elsewhere to sort of get away from 830 00:42:14,400 --> 00:42:18,760 Speaker 2: messi countries, Whether it's Messi democratic countries or Messi autocratic countries. 831 00:42:18,920 --> 00:42:20,960 Speaker 5: Yeah, I mean that the Miami thing is is the 832 00:42:21,000 --> 00:42:24,840 Speaker 5: same things. It's South America, you know, it's it's taking 833 00:42:24,960 --> 00:42:28,280 Speaker 5: all of your all of your wealth and and really 834 00:42:28,320 --> 00:42:30,520 Speaker 5: they're kind of robber barrons. It's the confiscation of other 835 00:42:30,760 --> 00:42:33,400 Speaker 5: of the good folks money and getting it out of 836 00:42:33,680 --> 00:42:37,359 Speaker 5: places like Venezuela and it resides might that's Miami. I'm 837 00:42:37,400 --> 00:42:39,840 Speaker 5: an La person because I was gonna say La is 838 00:42:39,840 --> 00:42:42,480 Speaker 5: a real place, which is kind of as you know, 839 00:42:42,520 --> 00:42:44,840 Speaker 5: but I mean it's real in the sense that you've 840 00:42:44,880 --> 00:42:47,880 Speaker 5: not got capital on the run, You've not got robber 841 00:42:47,960 --> 00:42:52,960 Speaker 5: barrons like they're the Dubai and the Seychelles. It only 842 00:42:53,000 --> 00:42:57,040 Speaker 5: exists because the US Treasury and the administration are looking 843 00:42:57,080 --> 00:42:59,000 Speaker 5: the other way. I don't know why they look the 844 00:42:59,040 --> 00:43:01,680 Speaker 5: other way. I really they don't because it's against the rue. 845 00:43:01,719 --> 00:43:04,279 Speaker 5: It's like, look, you know, there's there's a war. We're like, 846 00:43:04,360 --> 00:43:06,560 Speaker 5: we're kind of funding the Ukrainians against it, and we 847 00:43:06,560 --> 00:43:08,560 Speaker 5: should be really tight and should be no slippish, and 848 00:43:08,640 --> 00:43:11,080 Speaker 5: yet we let them, you know, we let them slip 849 00:43:11,120 --> 00:43:14,200 Speaker 5: into Turkey, into into Dubai and into the status I 850 00:43:14,239 --> 00:43:17,359 Speaker 5: would like again, you're staying, you're staying in Russia, call 851 00:43:17,440 --> 00:43:19,800 Speaker 5: me when you're you're more polite to your neighbors. 852 00:43:20,280 --> 00:43:23,719 Speaker 2: Hugh Hendry always great to catch up. Live vicariously a 853 00:43:23,760 --> 00:43:27,239 Speaker 2: life that's much more colorful, perhaps than ours here in 854 00:43:27,280 --> 00:43:28,080 Speaker 2: the Midtown office. 855 00:43:28,080 --> 00:43:30,440 Speaker 4: But thank you so much for coming back on oline. 856 00:43:30,920 --> 00:43:32,640 Speaker 5: Have been absolute pleasure. Let's do. 857 00:43:46,239 --> 00:43:47,280 Speaker 4: That was a lot of fun tracing. 858 00:43:47,680 --> 00:43:50,120 Speaker 3: It's always fun talking to Hugh. One thing I was thinking, 859 00:43:50,200 --> 00:43:52,239 Speaker 3: I kind of do you think Bloomberg would let us 860 00:43:52,360 --> 00:43:55,520 Speaker 3: expense the twenty five thousand dollars that it costs for 861 00:43:55,640 --> 00:44:00,640 Speaker 3: like a VIP package to the Acid Capitalist summer camp Part. 862 00:44:00,600 --> 00:44:02,640 Speaker 4: Yeah, for sure, for sure, I think so there's no culie. 863 00:44:02,640 --> 00:44:03,680 Speaker 4: I think it's worth Yeah, let's go. 864 00:44:04,000 --> 00:44:07,680 Speaker 2: I don't necessarily feel chilled or relaxed. I mean the 865 00:44:07,760 --> 00:44:09,560 Speaker 2: idea that like something is going to happen at the 866 00:44:09,560 --> 00:44:11,520 Speaker 2: treasury market, yields are going to go back down to 867 00:44:11,560 --> 00:44:13,320 Speaker 2: one two percent doesn't make me relax. 868 00:44:13,520 --> 00:44:13,600 Speaker 5: No. 869 00:44:13,920 --> 00:44:17,480 Speaker 3: Also, the time to panic about the currency war line 870 00:44:17,719 --> 00:44:20,239 Speaker 3: isn't exactly reassuring. The other thing I was thinking, I 871 00:44:20,239 --> 00:44:21,960 Speaker 3: think the thing that will stand out to me is 872 00:44:22,000 --> 00:44:24,759 Speaker 3: the idea about a lot of emerging markets being good 873 00:44:24,880 --> 00:44:29,040 Speaker 3: at generating GDP growth but not wealth. I feel like 874 00:44:29,120 --> 00:44:32,520 Speaker 3: that encapsulates, certainly a lot of the story around China 875 00:44:32,640 --> 00:44:35,600 Speaker 3: right now, and the question over why not boost domestic 876 00:44:35,640 --> 00:44:39,719 Speaker 3: consumption versus manufacturing and sort of repeating the same thing 877 00:44:39,760 --> 00:44:41,080 Speaker 3: you've been doing for decades now? 878 00:44:41,280 --> 00:44:43,600 Speaker 4: No, I mean I think that is it just true? 879 00:44:43,640 --> 00:44:46,719 Speaker 2: Right, Like there's been incredible growth of some of these companies. 880 00:44:46,760 --> 00:44:48,560 Speaker 2: I mean even if you look like I was looking 881 00:44:48,560 --> 00:44:51,480 Speaker 2: at the chart of like BYD the other day, which 882 00:44:51,560 --> 00:44:55,319 Speaker 2: is like everyone knows now, is like this like global behemoth, 883 00:44:55,840 --> 00:44:59,160 Speaker 2: you know, arguably by some measures, bigger than Tesla. Like 884 00:44:59,280 --> 00:45:02,160 Speaker 2: that Stuck is the same that was where it was 885 00:45:02,200 --> 00:45:04,200 Speaker 2: in twenty twenty. But if you actually if you go 886 00:45:04,360 --> 00:45:07,400 Speaker 2: back to even like twenty ten, or if you go 887 00:45:07,440 --> 00:45:09,359 Speaker 2: back to like two thousand and nine, it's only up 888 00:45:09,440 --> 00:45:11,200 Speaker 2: like threefold since it's peak. 889 00:45:11,040 --> 00:45:11,719 Speaker 4: In two thousand nine. 890 00:45:11,719 --> 00:45:13,480 Speaker 2: I mean, this is a company that was literally nothing 891 00:45:13,560 --> 00:45:15,680 Speaker 2: and now at the forefront of like probably one of 892 00:45:15,680 --> 00:45:17,040 Speaker 2: the biggest industries in the world. 893 00:45:17,080 --> 00:45:19,080 Speaker 4: Like it's not amazing. You don't get paid very much 894 00:45:19,120 --> 00:45:19,439 Speaker 4: to own. 895 00:45:19,360 --> 00:45:22,920 Speaker 3: The less than Domino's Pizza, I suppose, yeah, exactly, But 896 00:45:23,080 --> 00:45:24,719 Speaker 3: this is the other thing I was thinking about. So 897 00:45:24,880 --> 00:45:28,640 Speaker 3: there are pros and cons to the command economy model, right, 898 00:45:28,680 --> 00:45:30,680 Speaker 3: and the idea that you can pull all these policy 899 00:45:30,760 --> 00:45:34,360 Speaker 3: levers because on the one hand, like yes, China can 900 00:45:34,680 --> 00:45:38,840 Speaker 3: direct huge amounts of capital to whatever project it deems 901 00:45:38,880 --> 00:45:42,759 Speaker 3: strategically important at any one period of time. But on 902 00:45:42,800 --> 00:45:46,319 Speaker 3: the other hand, you get misallocation of capital, and then 903 00:45:46,360 --> 00:45:48,920 Speaker 3: you get the uncertainty that's sort of hanging over investors 904 00:45:48,960 --> 00:45:52,399 Speaker 3: where they can't predict what China is going to care 905 00:45:52,440 --> 00:45:54,960 Speaker 3: about next. So going back to you know, the real 906 00:45:55,080 --> 00:45:58,360 Speaker 3: estate crash, the three Red Lines program, and then the 907 00:45:58,520 --> 00:46:03,400 Speaker 3: crackdown on consumer internet companies, like those are real expressions 908 00:46:03,440 --> 00:46:06,640 Speaker 3: of the uncertainty of that particular aspect of the economy. 909 00:46:06,719 --> 00:46:07,440 Speaker 3: Shall we leave it there? 910 00:46:07,520 --> 00:46:08,680 Speaker 4: Let's leave it there, all right. 911 00:46:08,760 --> 00:46:11,759 Speaker 3: This has been another episode of the Authoughts podcast. I'm 912 00:46:11,800 --> 00:46:14,719 Speaker 3: Tracy Alloway. You can follow me at Tracy Alloway and. 913 00:46:14,680 --> 00:46:17,840 Speaker 2: I'm Joe Wisenthal. Follow me at The Stalwart. Follow Hugh Henry. 914 00:46:17,840 --> 00:46:21,680 Speaker 2: He's on Twitter at Henry Hugh. Follow him on Instagram. 915 00:46:21,840 --> 00:46:25,080 Speaker 2: Be very jealous of his life, check out his substack 916 00:46:25,120 --> 00:46:27,319 Speaker 2: in his book and all that again, make you very 917 00:46:27,400 --> 00:46:30,960 Speaker 2: jealous follow our producers Carmen Rodriguez at Kerman Ermann, Dashel 918 00:46:30,960 --> 00:46:33,879 Speaker 2: Bennett at dashbot and kel Brooks at kel Brooks. Thank 919 00:46:33,920 --> 00:46:36,920 Speaker 2: you to our producer Moses Onam. For more Oddlots content, 920 00:46:36,960 --> 00:46:39,120 Speaker 2: go to Bloomberg dot com slash odd Lots for your 921 00:46:39,160 --> 00:46:41,960 Speaker 2: transcript of blog in the newsletter and chat about all 922 00:46:42,000 --> 00:46:44,320 Speaker 2: of these topics twenty four to seven in the discord 923 00:46:44,520 --> 00:46:46,680 Speaker 2: Discord dot gg slash outline. 924 00:46:46,800 --> 00:46:49,440 Speaker 3: And if you enjoy all thoughts, if you want us 925 00:46:49,520 --> 00:46:52,560 Speaker 3: to go to the Acid Capitalist Camp in St. Barts, 926 00:46:52,600 --> 00:46:55,280 Speaker 3: then please leave us a positive review on your favorite 927 00:46:55,280 --> 00:46:59,040 Speaker 3: podcast platform. And remember, if you are a Bloomberg subscriber, 928 00:46:59,080 --> 00:47:02,240 Speaker 3: you can listen to all of our episodes absolutely add free. 929 00:47:02,440 --> 00:47:04,840 Speaker 3: All you need to do is connect your Bloomberg account 930 00:47:05,000 --> 00:47:07,360 Speaker 3: with Apple Podcasts. Thanks for listening.