Sep.14 -- Mark Spitznagel, Universa Investments LP founder, discusses the lessons learned from the 2008 financial crisis. He speaks with Bloomberg's Erik Schatzker.
After 10 minutes of interviewing Mark, the interviewer asks him "why didnt your firm take a hit in Feb '18?". Bloody hilarious that he didnt figure out a word of what Mark was saying. How can an insurance provider ever get an explosive payoff? Phew, the fun with these large media channels.
You losers don't know either lol. If it was so easy, your dumb asses would explain the magic trick. Gee I dunno. He's buying deep in the money Puts that expire 3 years out? Lolz... You don't know, loser.
When Norway grew rich due to oil, our government decided to save money for future generations. US (the richest country on earth) government have dicided to take huge loans which future generations have to pay. We all got what we woted for.
One good metric to judge the degree of interventionism is the size of central bank balance sheets as a percent of GDP. That number seems destined to ratchet upwards until people start questioning the very basis of our financial system.
Wrong. Large central bank balance sheets are a result of too little intervention. A central bank that lacks credibility or has the end wrong policy regime will find it's policy ineffective due to increased demand for money, for example.
Hopefully we the people can make a new law to restrict the fed from doing QE without at least congressional approval. They will destroy the currency. Whenever the do QE they should be required to distribute that money equally to all citizens and also to any country that uses the USD as their currency.
I love how every fund manager has a vague rambling answer about why their funds don't beat the S&P500. Yet people still dump millions of dollars into these people's pockets.
Most funds aren't trying to beat the S&P500. Most funds are trying to get almost the same return (but will happily accept less than) at a significantly lower risk level (as measured by standard deviation/exposure to volatility). If the S&P has an 11% return and a standard deviation of 2%, they'll happily accept a 9% return with a standard deviation of 1%. By that measurement they're doing better than the S&P.
His fund is primarily for the preservation of capital in order to maximize the rate at which you’re able to compound. And ultimately as an investor that’s what’s most important .
We're looking at a market bubble, deregulation, massive federal deficit and tax policy with a long history of failure. To this is added a trade war and sanctions. These are for the most part the same policies in place before the Great Depression.
You cannot let interest rates be determined by absolute market forces with a population over 300 million people; money velocity is absolutely essential in maintaining political and economic balance. If rates were set by private market actors there would mini-Feds (private firms, mostly commercial banks) who would horde capital when credit events occur, liquidity would be cut off instantaneously with market oriented interest rate pegging. There is a disconnect between money as a use-value and as an exchange value. Money's use is the inherent universal equivalent, or universal commodity of exchange, in market transactions. However, money's use is determined by the process of exchange itself, and the price money will fetch on the open market in either interest or real goods/services. This is the dialectical dilemma of money as a representation of commodities. When one hedges, one is hedging either for or against money's exchange-value with respect to it's use-value.
Nothing aside from Bitcoin (keep your coins in a wallet where only you own the private key) and gold (small denomination coins like 20 Franks) until all markets are discounted. Then invest in real estate (the kind ordinary working class people can afford), fix em up and rent them out. Keep an eye on Australia's (!), Canada's and China's (!) real estate markets, US stock market & FED rate hikes (!), Italy's & Spain's economies in Europe, Brexit effects. Oh yeah, cash is king but keep in mind that banks are already protecting themselves against bank runs (here, in Europe, they are trying to ban cash for the past few years), therefore cash is king though it too can crash.
One thing the financial industry needs to understand is that should there be another financial crash the ordinary man in the street will not tolerate a bale-out. Riots on the streets before that happens.
Hey Bloomberg, I like Mark. His books are poorly written but contain some useful nuggets. However, in interviews, his is resistant to answering any question about his strategy. STOP asking those questions. Ask something else or just don't interview him.
This guy is fullofshit... individual stocks.. check it out... Starbucks in three months up 30 % ...target..3months up 17% ...lots of good stocks...go Trump
Jujitsu is fighting, what kind of stupid ass remark was that? When comments are made in that nature it’s hard for me to believe any of the other part that I don’t already know.
Gold isn't a hedge or insurance policy. He's talking about spending a small portion of money to buy out of the money put options that blow up in value when the market crashes.
If you invest but don't gamble, there is just no 'volatility tax'. It‘s because you gamble in trading that cause the problem. But I like these traders because the more they trade the more value opportunities they bring to the market.
You are actually so stupid holy fuck. Do you even understand the basic properties of geometric average returns? Holy fuck, just do some basic research, but you probably don't even understand basic algebra so you wouldn't even understand how the volatility tax affects everyone. Idiot
He basically said invest in the market but buy insurance. He didn't want to say what insurance to buy because he doesn't want you to go buying the exact same thing driving up his cost! But basically they touched on one type of insurance. Buying a put option.
Gold and silver are as bad as stocks. Completely useless. When Obama was elected the US dept was 72% of GDP. Now its 107% of GDP. Australia and China had no real negative set back the last recession because they produce products. And China bailed out the US over the last 10 yrs with loans. Now America has alienated its allies and China what will America do in their up coming crash? Because it will be another financial institutions crisis...... because the American financial models are shit.
Physical gold and silver are a commodity and have been around for thousands of years, before all the different currencies existed. If all the countries keep printing money like they are currently, your cash is worth less, but gold a silver will hold their value in the end
Which philosopher? Schopenhauer, descartes, kant? Which exactly? not that smart now, are you? But hey would not even call you intelligent. But hey, you can try bein' one.
@@Rothbardo .... The fact you have to ask that question means you don't understand the basics. What is understood does not need to be explained. Go read some books
@@ferelgreat ..... Go to the 8:00 minute mark. Re-play this video from that mark until the end over and over and over again. If you don't see the answers clear as sun shine..... Don't worry.... 90 percent of the population doesn't either.
What a snake oil salesman. He does some that is exceeding simple yet refuses to explain what he does because anyone with half a brain could do it themselves.
It isn't worthwhile in the long run, because all the time you are losing money to premiums on your insurance. It's like arguing that my car insurance is an investment, because if I total the car I get back a lot more than I paid in premiums. The problem is that my insurance will go up and in the long run recoup the costs, and that's only in a scenario where they don't refuse to pay. If a corporation goes under, it's first obligation is to its debt holders, not shareholders. Puts and swaps become worthless when the price hits $0. On top of the premiums you pay for out of the money options, buying this fund requires you to pay substantial fees which eat into your profit even more.
This guy is completely not taking any accountability to admitting to any information out of fear of being quoted as being incorrect, and thus losing future customers. He wants to give the impression that he can anticipate financial down turns by promising diversification as a means of protection. Which isn’t wrong, but it means he basically doesn’t know what’s going to happen.
The Fed does its job as best it can. The problem is Congress and the President deficit spending money, passing lies like "Free Trade" with communist China and giving up sovereignty to international corporations who develop countries other than the United States.
Yeah right... His fund just made 3600% while everyone else is going out of business and getting margin calls.... Just because you dont understand it doesnt mean the guy is full of BS
This guy seems a lot like a snakes-oil salesman. He promises huge returns when the markets are stable AND "explosive" returns when they're volatile. Whenever asked how he does that magic trick, he just throws up weird terms he made up ("explosive insurance-like convex payoffs") that say nothing, just to appear smart.
Reading about how to fish isn't enough to be a good fisherman. At some point you have to do the the hard work of getting on a boat and taking the time, the risk that is required with seafaring . The exact how of his method is fluid but the philosophy is enduring. Markets have mispriced risk in the past, they will again in the future and you can profit from that. Even people with a less than a high school education can understand this stuff. If you want to be agnostic about better returns than the market - read and learn and do. If not just buy and a big index and keep 40% in cash. Then deploy cash when the market drops. The nice thing about the "empty hand" is that it usually signals a market bottom or at least near market bottom. Having fresh cash to deploy when the everything is on sale is the only way to shop for stocks (list keeping handy). Much of investing is waiting for the right time, or actively choosing not to invest. Witnessing the "empty hand" in my trading account in major indexes 3 times since 2016 was all the proof I needed (also exhilarating). If you don't know what the empty hand is, you haven't read the Dao of Capital. Reading all of Teleb works in conjunction with Spitznagle provide the right lens to see markets the way these guys do.
He also told everyone how he does it at great risk to his own proprietary strategy (market have changed since his methods have been divulged) . Thank you is all you need to say. If everyone were as generous as Taleb and Spitznagle the world be a better place.
He actually said a lot. You just need some deeper understanding of economics and finance in order to interpret it. He's a very smart dude, understands what's going on.
??? and which bank gets then to decide how much money there really is? Or will there be a central blockchain (i.e. predetermined finite number of 'coins' in a public ledger) for banks? The problem isn't necessarily monetary policy. A central bank sits between two opposing goals. (1) Stability of money value. (2) Health of the economy. The £ is considered a stable currency. So was the German Mark by the Bundesbank (spiritual ancestor of the ECB). The centrals bank first goal is to ensure money stability. The objective of the FED is tought of traditionally to facilitate trade and commerce. Before the US had a central bank, the banks used to issue their own "money". Which kinda sucks since your entire commerce relies on JP Morgan gift cards
@paulcmnt Simplified but will do. Still my initial question, how do you control money supply? What is your system that ensures supply and demand find their counterpart. How do you prevent lending of money that a Bank doesn't have yet below a certain reserve threshold (i.e. creating money)? How does the Bond market work? If you want a national currency, you need a central Bank in some way or another. Maybe not in it's current form. But some form nevertheless.
@paulcmnt I'll leave it to Dr. M to pursue the money supply question, but I do want to correct you on how the Fed works. It doesnt control demand, it primarily influences supply by controlling how much cash banks are required to holding in their Reserve accounts.This in turn affects interest rates, investment, growth, employment, and inflation.
We've seen unconstrained interest rate floats in certain types of short term lending markets, Brock. Because securities are held in short- and long-term portfolios, free floating and determination by market forces would collapse short-term markets through attempts to gain margin and thereafter collapse the markets for long-term securities, most of which comprise bets and hedges on futures. I may be wrong here because we can never truly predict how people will engage en masse, but if you look at how unrestrained finance plays out in subprime lending markets (payday loans, high interest secured and unsecured lending), that same situation would be more likely to occur with constraints removed at the macro level. I like Dalio's perspective on these matters: Don't ask an economist for financial advice, and don't ask a financial expert what's best for the economy. Finance can speak to the behaviors in markets, but as the complexity of a market grows, so too do the conflicts between revenue streams. Bailouts are an example of interventions necessary when the government uses financial advice to make broader economic decisions. It's avoidable when easing decisions analyze herd behavior, learn and target key influencers, and ease those influencers' beliefs and behaviors.
Prior to the first Great Depression the federal reserve had artificially low interest rates set by old line Republicans as pay back for corporations that helped them get elected. Banks were then able to loan millions to feed speculative schemes. The American public was in enormous debt and their wealth was all on paper. Within days the wealth of a large part of the country which had been concentrated in the vastly inflated stock prices simply vanished. Speculation which created wealth disappeared in the great crash. The wealth of the world was concentrated in the hands of a small class at the top. The wealth trickling down from the top was not enough. The great bulk of the population simply couldn't create the demand needed to keep up with the increasing supply. Manufacturers decreased production. Jobs were lost. The jobless could no longer paid for their mortgages. Millions lost their homes. Then as now, the greater the stock bubble, the greater the crash and depression. The Federal Reserve must not be seen as incompetent and incapable of not caving in to political pressure if it is to survive the economic depression that is coming. Those that think FDR"s policies that helped Americans get through the first great depression were too socialist are in for a rude awakening.
His trading startegy in analogy terms is something very simple. Tesla. Short short short short short from day one. But, then he shorts, so there is a swueeze, so there is a little bit of bleedibg. Short short short. Still tesla. 10 point or say considering the stock price,lets be rational, 20-5 points cover in stock. And a lil bit of options. Breakeven.
Trumpty Dummie wanted a big wall Trumpty Dummie had a big fall All the cheap economist And all the stock floor kids Couldn't put Trumpty back in the office again Sad
