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Episode 74
Featuring Peter Boockvar
A discussion about recent Fed comments, the prospect and performance of financial stocks, concerns about liquidity, the government shutdown, trade, China, marijuana stocks, Tesla, and what Demetri believes is the resurgence of democratic socialism as a powerful force that markets will need to contend with in 2020.

In this week’s episode of Hidden Forces, Demetri Kofinas speaks with Peter Boockvar. Peter is Chief Investment Officer for Bleakly Advisory Group and a regular on CNBC, where he provides market commentary about fed policy, market trends, economic data, stocks, bonds, etc.

 

Every now and again, Demetri brings people from the media onto Hidden Forces in order to get their take on the markets and to hear their interpretations about the latest data, news, and information. The purpose of this is to gain a better understanding of how the news media is constructing the very narratives that given reason to what we’re seeing and what we can expect to see in the coming weeks and months.

 

There has been a significant shift in how the financial press has been talking about markets recently. Even the words that they have been using to describe developments that could otherwise be viewed in a positive light are being characterized in bearish terms. Demetri asks Peter for his interpretation of some of the recent economic data, including the latest manufacturing numbers out of Germany, as well as the recent anecdotal data provided by Apple in their 1,400-word letter to investors, which lead to a 10% drop in their stock price (their worst, one-day performance in five years). The two discuss recent comments by Fed chairman Powell, the prospect and performance of financial stocks, concerns about liquidity, the government shutdown, trade, China, marijuana stocks, Tesla, and what Demetri believes is the resurgence of democratic socialism as a powerful force that markets will need to contend with in 2020.  

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

Peter Boockvar is the Chief Investment Officer of Bleakley Advisory Group, a $3.5B wealth management firm. He is also Editor of The Boock Report. He previously was the Chief Market Analyst for The Lindsey Group, a macro economic and market research firm started by Larry Lindsey. Prior to this, Peter spent a brief time at Omega Advisors, a New York-based hedge fund, as a macro analyst and portfolio manager. Before this, he was an employee and partner at Miller Tabak + Co for 18 years where he was recently the equity strategist and a portfolio manager with Miller Tabak Advisors. Peter graduated Magna Cum Laude with a B.B.A. in Finance from George Washington University.

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Investing
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Special Episode
Featuring Howard Marks
Investing
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Special Episode
Featuring Howard Marks
In this Christmas Day special, Demetri shares twenty-five minutes of never-before-heard audio from his conversation with Howard Marks, but not before announcing the long-awaited-for launch of the Hidden Forces subscription. Subscribers can gain access to overtime segments, transcripts, and rundowns from each and every episode.

In this Christmas Day special, Demetri Kofinas shares twenty-five minutes of never-before-heard audio from his conversation with Howard Marks, but not before announcing the long-awaited-for launch of the Hidden Forces subscription service. Subscribers can gain access to overtime segments, transcripts, and rundowns from each and every episode. Subscriptions require creating a Patreon account, but can be accessed directly through the Hidden Forces website via subscription tabs located within any particular episode.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

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Investing
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Episode 70
Featuring Andrei Shleifer
This episode centers on the subject of beliefs: how they impact markets and how economists and financial practitioners like Andrei Shleifer are attempting to model them using data about people’s expectations, assumptions, and attitudes in order to make better informed investment and policy decisions.

In this week’s episode of Hidden Forces, Demetri Kofinas speaks with Andrei Shleifer, professor of economics at Harvard University. Dr. Shleifer is the most cited economist in the world according to RePEc’s database. Throughout the course of his career, Andrei Shleifer has worked in the areas of comparative corporate governance, law & finance, behavioral finance, as well as institutional economics. He has published seven books, including, A Crisis of Beliefs: Investor Psychology and Financial Fragility with his co-author Nicola Gennaioli.   

 

Demetri’s conversation with Andrei centers on the subject of beliefs: how they impact markets and how economists and financial practitioners are attempting to model them using data about people’s expectations, assumptions, and attitudes in order to make better-informed investment and policy decisions.

 

The first half of the episode is devoted to exploring the mechanics of the 2007-2008 credit crisis, and the role played by structured products and derivatives, off-balance sheet vehicles, money market funds, GSE’s, and a policy of ultra-low interest rates that fueled over-confidence in the power of regulators and in the sustainability of the status quo. In the second half, Dr. Shleifer provides us with a more formal approach to thinking about Hyman Minsky’s instability hypothesis and how market participants can draw radically different conclusions about that same data when their beliefs about the world change dramatically.

 

Given the destabilizing forces of populist politics, trade tensions, and changing geopolitical fault lines, the ability to draw valuable insights from data about expectations and beliefs is invaluable for any investor or policymaker looking to gain a sense of market sentiment: where it stands and where it might be going.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

Play
Episode 18
Featuring Samuel Bowles
Episode 18
Featuring Samuel Bowles

Andrei Shleifer is John L. Loeb Professor of Economics at Harvard University. He holds an undergraduate degree from Harvard and a Ph.D. from MIT. Before coming to Harvard in 1991, he has taught at Princeton and the Chicago Business School. Shleifer has worked in the areas of comparative corporate governance, law & finance, behavioral finance, as well as institutional economics. He has published seven books, including The Grabbing Hand (with Robert Vishny), Inefficient Markets: An Introduction to Behavioral Finance, and A Crisis of Beliefs: Investor Psychology and Financial Fragility (with Nicola Gennaioli), as well as over a hundred articles.

 

Shleifer is an Editor of the Quarterly Journal of Economics, and a fellow of the Econometric Society, the American Academy of Arts and Sciences, and the American Finance Association. In 1999, Shleifer won the John Bates Clark medal of the American Economic Association. According to RePEc, Shleifer is the most cited economist in the world.

 

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Sed egestas, ante et vulputate volutpat, eros pede semper est, vitae luctus metus libero eu augue. Morbi purus libero, faucibus adipiscing, commodo quis, gravida id, est. Sed lectus. Praesent elementum hendrerit tortor. Sed semper lorem at felis. Vestibulum volutpat, lacus a ultrices sagittis, mi neque euismod dui, eu pulvinar nunc sapien ornare nisl. Phasellus pede arcu, dapibus eu, fermentum et, dapibus sed, urna.

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Sed egestas, ante et vulputate volutpat, eros pede semper est, vitae luctus metus libero eu augue. Morbi purus libero, faucibus adipiscing, commodo quis, gravida id, est. Sed lectus. Praesent elementum hendrerit tortor. Sed semper lorem at felis. Vestibulum volutpat, lacus a ultrices sagittis, mi neque euismod dui, eu pulvinar nunc sapien ornare nisl. Phasellus pede arcu, dapibus eu, fermentum et, dapibus sed, urna.

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Suspendisse mauris. Fusce accumsan mollis eros. Pellentesque a diam sit amet mi ullamcorper vehicula. Integer adipiscing risus a sem. Nullam quis massa sit amet nibh viverra malesuada. Nunc sem lacus, accumsan quis, faucibus non, congue vel, arcu. Ut scelerisque hendrerit tellus. Integer sagittis. Vivamus a mauris eget arcu gravida tristique. Nunc iaculis mi in ante. Vivamus imperdiet nibh feugiat est.

Markets
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Episode 68
Featuring David R. Kotok
David Kotok discusses a wide-range of issues currently facing the global economy including trade, the US Dollar, European monetary policy, corporate bonds, as well as what markets he thinks are most at risk from interest rate tightening and as protectionist measures introduce new anomalies into the American economy.

In this week’s episode of Hidden Forces, Demetri Kofinas speaks with David Kotok, co-founder and CIO of Cumberland Advisors. David Kotok’s articles and financial market commentaries have appeared in The New York Times, The Wall Street Journal, Barron’s, and other publications.   

 

This is a fascinating conversation that spans a wide-range of issues currently facing the global economy, as well as subjects and themes stretching as far back as 5th century Athens. Demetri asks David Kotok for his opinion on a series of topics including trade, the US Dollar, European monetary policy, as well as what markets he thinks are most at risk as the Fed continues down its path of tightening and as protectionist trade measures introduce new anomalies into the American economy. Kotok also shares his experience investing during the turbulent years of the 1970s and how the lessons he learned during that decade can be applied today.

 

David also gives his outlook for credit markets, specifically the riskier areas of the corporate bond market that include leveraged loans and middle market lending. Investors will find this conversation helpful, as they adjust their strategies to protect themselves against some of the non-linear impacts of government policies while still positioning themselves and their clients to profit from the rising tide of economic growth.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

Play
Episode 18
Featuring Samuel Bowles
Episode 18
Featuring Samuel Bowles

David R. Kotok co-founded Cumberland Advisors in 1973 and has been its Chief Investment Officer since inception. He holds a B.S. in economics from The Wharton School of the University of Pennsylvania, an M.S. in organizational dynamics from The School of Arts and Sciences at the University of Pennsylvania, and an M.A. in philosophy from the University of Pennsylvania.

 

Mr. Kotok’s articles and financial market commentaries have appeared in The New York Times, The Wall Street Journal, Barron’s, and other publications. He is a frequent contributor to Bloomberg TV and Bloomberg Radio, Fox Business, and other media.

 

Mr. Kotok has served as Program Chairman and currently serves as a Director of the Global Interdependence Center (GIC), whose mission is to encourage the expansion of global dialogue and free trade in order to improve cooperation and understanding among nation states, with the goal of reducing international conflicts and improving worldwide living standards. Mr. Kotok chaired its Central Banking Series and organized a five-continent dialogue held in Cape Town, Chile, Hong Kong, Hanoi, Milan, Paris, Philadelphia, Prague, Rome, Santiago, Shanghai, Singapore, Tallinn, and Zambia (Livingstone). He has received the Global Citizen Award from GIC for his efforts.

 

Mr. Kotok is a member of the National Business Economics Issues Council (NBEIC), the National Association for Business Economics (NABE) and served on the Research Advisory Board of BCA Research. Mr. Kotok has served as a Commissioner of the Delaware River Port Authority (DRPA) and on the Treasury Transition Teams for New Jersey Governors Kean and Whitman. He has also served as a board member of the New Jersey Economic Development Authority and as Chairman of the New Jersey Casino Reinvestment Development Authority. He has authored or co-authored four books, including the second edition of From Bear to Bull with ETFs and the newest book Adventures in Muniland.

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Sed egestas, ante et vulputate volutpat, eros pede semper est, vitae luctus metus libero eu augue. Morbi purus libero, faucibus adipiscing, commodo quis, gravida id, est. Sed lectus. Praesent elementum hendrerit tortor. Sed semper lorem at felis. Vestibulum volutpat, lacus a ultrices sagittis, mi neque euismod dui, eu pulvinar nunc sapien ornare nisl. Phasellus pede arcu, dapibus eu, fermentum et, dapibus sed, urna.

Morbi interdum mollis sapien. Sed ac risus. Phasellus lacinia, magna a ullamcorper laoreet, lectus arcu pulvinar risus, vitae facilisis libero dolor a purus. Sed vel lacus. Mauris nibh felis, adipiscing varius, adipiscing in, lacinia vel, tellus. Suspendisse ac urna. Etiam pellentesque mauris ut lectus. Nunc tellus ante, mattis eget, gravida vitae, ultricies ac, leo. Integer leo pede, ornare a, lacinia eu, vulputate vel, nisl.

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Economics
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Episode 67
Featuring Bill Janeway
A new sort of political economy, driven by the disruptive forces of globalization, financialization, and the information revolution, has made ideological approaches to economic thinking obsolete. In this episode, Bill Janeway proposes a new model for how to think about capitalism at the frontier of technological change.

In this week’s episode of Hidden Forces, Demetri Kofinas speaks with Bill Janeway about capitalism in the innovation economy. Janeway is a senior advisor and managing director of Warburg Pincus, where he was responsible for building the investment firm’s information technology investment practice. Bill is also a co-founder and member of the board of governors of the Institute for New Economic Thinking.

 

In 1948, the same year in which Claude Shannon’s revolutionary paper on information theory was first published in the Bell Labs Technical Journal, economist Paul Samuelson released what would become, the best-selling economics textbook of all time.

 

Though no one can measure the creative impact of Shannon’s ideas in shaping the next 70 years of innovation and progress in the information sciences, Samuelson’s work is perhaps equally noteworthy for the destructive impact it had on three generations of capitalists, policy makers, and academics. The legacy of the neoclassical synthesis is one of economic theories built on models that borrowed recklessly from the physical sciences, canonized in the works of Samuelson’s Economics.  

 

The failure of neoclassical economics with its dynamic stochastic equilibria and Gaussian-based models like VaR and MPT - peddling false promises of mean regression - have forced academia to rethink the entire edifice upon which our understanding of markets and the economy have been built.  A new sort of political economy, driven by the disruptive forces of globalization, financialization, and the information revolution, have made ideological approaches to economic thinking obsolete. In this climate, what Bill Janeway calls “the mission-driven state,” has been rendered illegitimate as an economic actor, disrupting the process of capitalism itself, as well as the credit cycle from which paradigm-shifting innovations are born.

 

Still, ideas matter. The failure of modern macroeconomic models, to account for the Global Financial Crisis was a precondition for the type of creative destruction that we have seen applied to problems of markets and the economy in recent years. Developing a new framework for understanding the role of government, the power of markets, and the forces driving both is crucial if we hope to survive the changes of the 21st century.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

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Episode 18
Featuring Samuel Bowles
Episode 18
Featuring Samuel Bowles

Bill Janeway is a Senior Advisor and Managing Director of Warburg Pincus. He joined Warburg Pincus in 1988 and was responsible for building the information technology investment practice. Previously, he was executive vice president and director at Eberstadt Fleming. Dr. Janeway is a director of Magnet Systems and O'Reilly Media. He is an Affiliated Member of the Faculty of Economics at Cambridge University.

 

Dr. Janeway is a co-founder and member of the board of governors of the Institute for New Economic Thinking. He is a member of the board of directors of the Social Science Research Council and of the Field Institute for Research in the Mathematical Sciences and of the Advisory Board of the Princeton Bendheim Center for Finance. He is a member of the management committee of the Cambridge-INET Institute, University of Cambridge and a Member of the Board of Managers of the Cambridge Endowment for Research in Finance (CERF). He is the author of Doing Capitalism in the Innovation Economy: Reconfiguring the Three-Player Game between Markets, Speculators, and the State, the substantially revised and extended new edition of the book initially published by Cambridge University Press in November 2012.

 

Janeway received his doctorate in economics from Cambridge University where he was a Marshall Scholar. He was valedictorian of the class of 1965 at Princeton University.

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Bill Janeway | Venture Capitalism and the Future of the Innovation Economy
Investing
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Episode 63
Featuring Howard Marks
Demetri Kofinas speaks with legendary value investor Howard Marks about the greatest challenge facing the next generation of value investors. Howard serves as the co-chairman and co-founder of Oaktree Capital Management, a leading investment management firm responsible for over 120 billion dollars in client assets.

In this week’s episode of Hidden Forces, Demetri Kofinas speaks with legendary value investor Howard Marks. Howard serves as the co-chairman and co-founder of Oaktree Capital Management, a leading investment management firm responsible for over 120 billion dollars in client assets.

 

This week’s conversation centers on the market cycle, its origins and impact. Howard shares his philosophy on risk management, asset bubbles, contrarianism, and what he calls second-level thinking – an approach thinking about value that puts price front and center. The two also explore how markets and the economy have changed over the last fifty years and how the drivers of a secular bull-market in finance may already have come to an end. They explore how a new-normal economy, characterized by low-returns on capital is unleashing political and social forces that have yet to be fully appreciated, let-alone priced into financial assets. Howard Marks shares his views on what it means to be a contrarian investor, how he thinks about risk management, and what his philosophy is around value investing. He also reflects on what his fifty years in finance have taught him about human psychology, herd behavior, and what he calls “bubble-thinking.”

 

Finally, Demetri asks Howard what he sees as the greatest challenge facing the next generation of investors. He reflects on the rotation of money out of active and into passive investment vehicles, theories of secular stagnation, and shares his opinion on what skills he believes investors will need in order to survive and thrive in the next market downturn.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

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Episode 18
Featuring Samuel Bowles
Episode 18
Featuring Samuel Bowles

Howard Marks, serves as the co-chairman and co-founder of Oaktree Capital Management, a leading investment management firm responsible for over 120 billion dollars in client assets. Since the formation of Oaktree in 1995, Mr. Marks has been responsible for ensuring the firm's adherence to its core investment philosophy; communicating closely with clients concerning products and strategies; and contributing his experience to big-picture decisions relating to investments and corporate direction.

 

From 1985 until 1995, Mr. Marks led the groups at The TCW Group, Inc. that were responsible for investments in distressed debt, high yield bonds, and convertible securities. He was also Chief Investment Officer for Domestic Fixed Income at TCW. Previously, Mr. Marks was with Citicorp Investment Management for 16 years, where from 1978 to 1985 he was Vice President and senior portfolio manager in charge of convertible and high yield securities. Between 1969 and 1978, he was an equity research analyst and, subsequently, Citicorp's Director of Research. 

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Finance History
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Finance History
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Episode 59
Featuring Grant Williams
The crisis in emerging markets, the collapse in cryptocurrencies, and the palace intrigues of Elon Musk, are the phenomena of a quantum world where the laws of classical economics break down, space-time preferences collapse, and quantum entanglements lead to spooky correlations that threaten the very fabric of market capitalism.

In this week’s episode of Hidden Forces, Demetri Kofinas speaks with Grant Williams about the crisis brewing in emerging markets, the collapse in cryptocurrencies, and the palace intrigues of Elon Musk. All of these phenomena exhibit the common feature of “quantum weirdness at the zero-bound,” where the laws of classical economics break down, space-time preferences collapse, and quantum entanglements lead to spooky correlations that threaten the very fabric upon which markets are made and prices discovered.

 

Grant Williams is perhaps known best for industry leading, long-form conversations with some of the most brilliant fund managers, short sellers, and financiers from around the world. He is also the founder and editor of the popular financial newsletter, “Things that Make you go Hmmm,” as well as a co-founder of Real Vision. Grant began his career working in the City of London in 1985, joining the trading desk of John Galvanoni at Fleming & Company. Not long after, Grant moved to Tokyo, where he was busy trading the Nikkei from 1986 until its epic collapse in 1989. A financial journeyman, Grant has never ceased to travel, moving from one city to the next for the last thirty-five years. In 2013, Grant Williams and Raoul Pal came together to set the seeds for Realvision, a subscription media company that aims to become the Netflix of financial media.

 

This is an episode full of laughter, history, and creative wisdom. It’s a conversation you will not want to miss.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

Play
Episode 43
Featuring Elizabeth C. Economy
Episode 43
Featuring Elizabeth C. Economy

Grant Williams is perhaps known best for industry leading, long-form conversations with some of the most brilliant fund managers, short sellers, and financiers from around the world. He is also the founder and editor of the popular financial newsletter, “Things that Make you go Hmmm,” as well as a co-founder of Real Vision. Grant began his career working in the City of London in 1985, joining the trading desk of John Galvanoni at Fleming & Company. Not long after, Grant moved to Tokyo, where he was busy trading the Nikkei from 1986 until its epic collapse in 1989.

 

A financial journeyman, Grant has never ceased to travel, moving from one city to the next for the last thirty-five years. In 2013, Grant Williams and Raoul Pal came together to set the seeds for Realvision, a subscription media company that aims to become the Netflix of financial media.

 

@ttmygh

ttmygh.com

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Grant Williams | Quantum Uncertainty and Spooky Correlations at the Zero-Bound
Stablecoins
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Stablecoins
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Episode 50
Featuring Nevin Freeman
The future of cryptocurrency may well depends on the success of stablecoins. According to Nevin Freeman, current stablecoin projects are doomed to fail. To explain why, this episode examines the fundamental properties of money, the meaning of value and price, and how existing stablecoins are trying to solve the hard problem of currency.

This is the year of the stablecoin, or so says Nevin Freeman, the founder of a new stable-value cryptocurrency project based in the San Francisco Bay area. In order to understand what stablecoins and how they work, we first need to understand money.

 

In order for something to qualify as money, it has traditionally needed to function as both a store of value, and as a medium of exchange for goods and services. The medium of exchange component of money allows it to function as a vital coordination mechanism for society, allowing humans and international governments and organizations to collaborate on a massive scale. Money is thus an intrinsic part of our capitalist infrastructure and, without currency, many of our most important institutions and organizational structures would collapse.

 

Yet, our system of money and credit is not without its share of problems. Middlemen, financial intermediaries, and other central organizations often charge exorbitant fees for their services. These same intermediaries often function as “gatekeepers,” permitting or preventing access to financial counterparities at their discretion. The mismanagement of our financial system by such institutions has become a major source of systemic risk, the brunt of which is disproportionately carried by those at the bottom of the economic pyramid.

 

Cryptocurrencies offer a possible solution to many of the most prominent problems associated with fiat currency systems. However, there are significant roadblocks on the path to widespread adoption. As we mentioned, in order to qualify as money, a currency needs to both the medium of exchange and store of value functions. This becomes difficult to do when currency volatility can wipe out 50% of your net worth in a single day or double the cost of your company’s inputs overnight.

 

It is no secret that crypto markets are remarkably volatile. Even the most prominent cryptocurrencies - Bitcoin and Ether - fluctuate wildly. Unfortunately, it’s impossible for a decentralized currency to function as an effective store of value if its price varies by as much as 15% on any given day and in any given direction. Even if the cryptocurrency in question were rarely to drop in price, upside volatility can create a speculative feed-back loop that discourages anyone from actually using it as a medium of exchange. Why would you pay someone’s salary in bitcoin if you expected the currency to be worth more after you sold it? In this sense, even a highly volatile asset with little downside risk that serves as a great store of value can still be a poor medium of exchange.

 

Until cryptocurrencies are able to function as both a store of value and as a medium of exchange, they are unlikely to become truly mainstream or see real-world adoption. Yet, as previously mentioned in the case of bitcoin, a cryptocurrency’s capacity to store value directly undermines it’s use as a medium of exchange. How do we resolve this paradox?

 

This is where stablecoins come in. They aim to solve the problems of our volatile crypto markets by establishing price-stable cryptocurrencies that are pegged to some other stable asset, for example, the US dollar. Notably, these pegs are not determined by supply and demand. Instead, stablecoins effectively “price themselves” by making a standing promise to fulfill any buy or sell order at a set price, regardless of changes in demand for the currency by market participants. In traditional currency pegs and exchange rate mechanisms, currency boards manage the value of the peg by overseeing the promise to buy or sell at a preset conversion price. So, how does a currency peg work in the case of stablecoins?Here is an overview of how the most prominent stablecoin projects on the market promise to do this today:

 

Traditional asset-backed stablecoins: In short, under this system, each unit of the particular stablecoin is backed by a corresponding unit of fiat currency. Let’s use the US dollar as an example. According to this system, a third-party issuer sells tokens for one dollar each. The issuer then keeps all the dollars taken in from these sales in an account. If an individual holding a unit of the stablecoin wishes to cash out, the third party gives a US Dollar to the holder and removes a unit of the stablecoin.

 

The problems with this method loom large. First, there’s the obvious fact that, at any moment, the organization or individual issuing the stablecoin can abscond with all the money that’s supposed to be in the bank account. Second, a government or other centralized organization could freeze the aforementioned account of the issuer, which would grind the project to an abrupt halt. In short, there’s a lot of risk and a lot of trust needed for this method to function properly.

 

Collateralized Debt Stablecoins: Under this system, instead of attempting to back units of a stablecoin one-to-one with a fiat currency, the stablecoins hold a ratio greater than one-to-one of a crypto asset (or more commonly, various kinds of crypto assets). The way this works is rather simple. An individual who holds a crypto asset can deposit this asset into a smart contract, which creates a stablecoin for them. 

 

The peg (the value of the stablecoin) is primarily maintained by the promise of future redemption for collateral if the stablecoin price diverges from the target for too long or the value of the collateral begins to drop. In either of these cases, all of the stablecoin holders can trade their coins for $1 worth of the collateralized crypto assets. In theory, speculators will step in to buy stablecoins below the target price based on this promise of future redemption and that will keep the price stable all of the time. The primary problem with this system is that that the underlying collateral is, by its very nature, volatile. As a result, in order to ensure itself against significant price drops, the system needs to hold a significant amount of collateral (often two-to-one, or even more). This is also a much more complex system, making it difficult to implement in a way that is efficient.

 

Future Growth-Backed Stablecoins: According to this system, the value is maintained by neither fiat or cryptocurrency holdings. Instead, a central account is created that uses algorithms to maintain the stability and manage the supply of the cryptocurrency in the face of fluctuating demand. It accomplishes this by increasing the number of stablecoins when the price goes up and decreasing the number when the price goes down. The increase in stablecoin supply is meant to reduce the market price of the coin to its target level. Conversely, when the price of the stablecoin drops below its target price, the system will reduce the supply of stablecoins and increase the price of the coin so that it returns to its target level. The primary issue with this method is tied to speculators. If they happen to lose interest in purchasing or actively begin to short the stablecoin, then the peg eventually breaks because the entire mechanism becomes worthless.

 

At the moment, it remains unclear which system, if any, will work. History has not been kind to currency boards, and the challenges of implementing a purely digital version of a currency peg has never before been tried until now.

 

In order to better understand the nature of stablecoins, and the promise that they have, Nevin Freeman joins us for a conversation about money and the fundamental properties of currency.

 

Ultimately, this is an exploration of how we can make cryptocurrencies a true store of value, while at the same time enabling these decentralized currencies to function as real and viable mediums of exchange.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation on FacebookInstagram, and Twitter at @hiddenforcespod

Nevin Freeman began life as an environmentalist in southern Oregon, where he studied wilderness preservation, thought about climate change, and considered ways of producing energy more efficiently. He stuck with this theme in college, studying mechanical and transportation system engineering in Portland, Oregon, in hopes of producing more efficient vehicles. But upon graduating, Nevin realized his understanding of the global ecosystem was simplistic and he was not on track to single-handedly solve global climate change the way he had imagined as a child.

 

After reflecting on why he wanted to preserve the ecosystem on the planet in the first place and realizing the thing he valued was flourishing of conscious beings, Nevin took a much broader approach to thinking about global problems and opportunities, integrating himself into the Future of Humanity Institute community, and co-creating the Effective Altruism movement – a group of people relying on reason and evidence to find the highest leverage ways of improving our world. He co-produced the first Effective Altruism Summit, directed the second one, and facilitated its transition to what is now Effective Altruism Global.

 

Nevin has spent his recent years building Paradigm Academy, a company builder in the Bay Area that specializes in recruiting and training ambitious, altruistic founders. Last year, Nevin left his full-time role at Paradigm to spin off Reserve, a full-stack open currency designed to bring economic stability to regions in the world with inflation problems. The Reserve team comes largely out of the Effective Altruism community, where many people aim to earn profits in order to fund the most important causes in the world.

 

Nevin's mission in life is to solve the coordination problems that are stopping humanity achieving its potential, and he’s particularly concerned about averting the long-term risks posed by the development of artificial intelligence. You can reach him through LinkedIn.

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Crypto
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Episode 34
Featuring Brian Kelly
Demetri Kofinas speaks with author, investor, and contributor to CNBC's Fast Money Brian Kelly about the problem of scalability, exchange & regulatory risk, cash-settled futures & ETF’s, and how bitcoin may fare compared to gold during a financial crisis. They also contemplate the impact of systemic trading on market downturns.

In this week’s episode of Hidden Forces, host Demetri Kofinas speaks with Brian Kelly, CEO of BKCM LLC, a digital asset investment firm. He is an experienced Global Macro investor with over twenty-five years’ experience in financial markets and a CNBC contributor who appears regularly on Fast Money.

 

Our most recent episodes with Chris Burniske on modeling cryptoassets and with Ari Paul on cryptocurrency trading methodologies introduced two foundational frameworks to our audience. This week's episode with Brian Kelly affords our audience the opportunity to explore both of these perspectives (theory and execution) in a single conversation. Brian Kelly is uniquely qualified to talk about the financial side of cryptocurrencies, but he also provides valuable perspective on how the media is covering this space.

 

Brian begins his conversation with Demetri by recounting his introductory experience to bitcoin, how he made his first investments, and what he learned in the year he wrote his book “The Bitcoin Big Bang.” The two explore familiar topics like the problem of scalability, exchange and regulatory risk, cash-settled futures and ETF’s, and how bitcoin may fare to gold during a systemic financial crisis. Is there any way to measure the intrinsic value of a given cryptocurrency? Can permissioned blockchains compete with public ledgers, or will cryptocurrencies come to dominate the future of software? Besides bitcoin and Ethereum, what are some of the more interesting cryptocurrency investment opportunities out there? Brian and Demetri also cover the recent spike in financial volatility amid this rising interest rate environment. Lastly, they consider how the rise of systemic trading strategies and passive investment vehicles like ETFs may accelerate (or not) a future market downturn.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation at @hiddenforcespod

 

Brian Kelly is Founder and CEO of BKCM LLC, an investment firm focused on digital currencies. He is the portfolio manager of the BKCM Digital Asset Fund. Brian is the author of "The Bitcoin Big Bang – How Alternative Currencies Are About to Change the World."

 

Prior to BKCM LLC, Brian was Co-Founder and Managing Partner of Shelter Harbor Capital LLC and managed the Shelter Harbor Capital Global Macro Hedge Fund. As well, Mr. Kelly was a co-founder and President of MKM Partners, a brokerage firm catering to institutional investment managers.

 

Brian provides money management services to a select clientele and consults on digital currencies.

Brian is a graduate of the University of Vermont where he received a B.S. in finance. He also holds an M.B.A. from Babson Graduate School of Business with a concentration in finance and econometrics.

 

@BKBrianKelly

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Morbi interdum mollis sapien. Sed ac risus. Phasellus lacinia, magna a ullamcorper laoreet, lectus arcu pulvinar risus, vitae facilisis libero dolor a purus. Sed vel lacus. Mauris nibh felis, adipiscing varius, adipiscing in, lacinia vel, tellus. Suspendisse ac urna. Etiam pellentesque mauris ut lectus. Nunc tellus ante, mattis eget, gravida vitae, ultricies ac, leo. Integer leo pede, ornare a, lacinia eu, vulputate vel, nisl.

Suspendisse mauris. Fusce accumsan mollis eros. Pellentesque a diam sit amet mi ullamcorper vehicula. Integer adipiscing risus a sem. Nullam quis massa sit amet nibh viverra malesuada. Nunc sem lacus, accumsan quis, faucibus non, congue vel, arcu. Ut scelerisque hendrerit tellus. Integer sagittis. Vivamus a mauris eget arcu gravida tristique. Nunc iaculis mi in ante. Vivamus imperdiet nibh feugiat est.

Crypto
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Episode 32
Featuring Ari Paul
Demetri Kofinas speaks with Ari Paul, co-founder and CIO of BlockTower Capital, a hedge fund focused on the cryptocurrency space about how are crypto funds are managing risk, what some of the most interesting and creative investment opportunities are and how investors can take advantage of them.

In this week’s episode of Hidden Forces, host Demetri Kofinas speaks with Ari Paul, co-founder, and CIO of BlockTower Capital, a hedge fund focused exclusively on the cryptocurrency space.

 

Over the course of the last year, cryptocurrency has dominated our society. The price of the most popular digital currencies surged, increasing in value by well over 1000% in a matter of weeks. We saw similar rises in initial coin offerings, with the number of token offerings increasing from just seven a month in January 2017 to more than forty a month by the end of the year.

 

This crypto euphoria fueled the formation of several cryptocurrency hedge funds which, according to their various founders, aim to bring the professional trading and portfolio management of Wall Street to the emerging class of digital asset. Although this work promises to open the crypto space to an entirely new class of traders, there are many questions regarding how these funds work and how reliable they are. For example, how are crypto fund managers managing risk? What sorts of benchmarks are crypto funds using in order to measure performance? And how does a cryptocurrency investor seek alpha in an already uncorrelated market? To answer these questions, and help shed some light on the emerging world of crypto hedge funds, we turned to Ari Paul.

 

As a portfolio manager who oversaw risk at the University of Chicago’s endowment investment office and the Chief Investment Officer at BlockTower Capital - a leading crypto hedge fund that raised over $140 Million in 2017 - Ari Paul is uniquely qualified to discuss the most interesting and creative investment opportunities for making money in cryptocurrencies. His positioning also means that he is intimately familiar with many of the risk factors that populate this new and fledgling market.

 

Over the course of the discussion, Ari Paul speaks with host Demetri Kofinas about the skepticism surrounding market values, how we can protect ourselves from counterparty and exchange risk, and how hedge funds like BlockTower Capital are making it easier for someone who may not be intimately familiar with blockchain technologies or the inner working of specific cryptocurrencies, participate in this new digital economy.

 

Demetri also asks Ari what the benchmarks for crypto funds like Blocktower are and how they measure performance. The challenge in the cryptocurrency space, according to Paul, Is that there are really three benchmarks: bitcoin, cryptocurrencies in general, as well as the broader equity markets. Seeking Alpha in an already uncorrelated asset class, therefore, presents a slew of new risk factors that aren’t present for traditional hedge fund managers. Ari Paul also gives his opinion on how the flood of institutional capital might alter these correlations, what a consolidation in cryptocurrencies might look like, and if we are verging near a collapse in valuations.

 

The two also take a look at cash-settled futures markets, consider the use of put and call options, and explore ways in which investors can better protect themselves from counterparty and exchange risk. Finally, they examine some of the most interesting and creative investment opportunities for making money in cryptocurrencies and what the average investor can do in order to take advantage of them.

 

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation at @hiddenforcespod

Ari Paul is the CIO and co-founder of BlockTower Capital. He was previously a portfolio manager for the University of Chicago's $8 billion endowment, and a derivatives market maker and proprietary trader for Susquehanna International Group (SIG). Ari earned a BA in political science from the University of Pennsylvania, and an MBA from the University of Chicago. Ari is a CFA charterholder. BlockTower Capital takes long and short positions across a variety of cryptocurrencies.

 

@AriDavidPaul

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Sed egestas, ante et vulputate volutpat, eros pede semper est, vitae luctus metus libero eu augue. Morbi purus libero, faucibus adipiscing, commodo quis, gravida id, est. Sed lectus. Praesent elementum hendrerit tortor. Sed semper lorem at felis. Vestibulum volutpat, lacus a ultrices sagittis, mi neque euismod dui, eu pulvinar nunc sapien ornare nisl. Phasellus pede arcu, dapibus eu, fermentum et, dapibus sed, urna.

Morbi interdum mollis sapien. Sed ac risus. Phasellus lacinia, magna a ullamcorper laoreet, lectus arcu pulvinar risus, vitae facilisis libero dolor a purus. Sed vel lacus. Mauris nibh felis, adipiscing varius, adipiscing in, lacinia vel, tellus. Suspendisse ac urna. Etiam pellentesque mauris ut lectus. Nunc tellus ante, mattis eget, gravida vitae, ultricies ac, leo. Integer leo pede, ornare a, lacinia eu, vulputate vel, nisl.

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Sed egestas, ante et vulputate volutpat, eros pede semper est, vitae luctus metus libero eu augue. Morbi purus libero, faucibus adipiscing, commodo quis, gravida id, est. Sed lectus. Praesent elementum hendrerit tortor. Sed semper lorem at felis. Vestibulum volutpat, lacus a ultrices sagittis, mi neque euismod dui, eu pulvinar nunc sapien ornare nisl. Phasellus pede arcu, dapibus eu, fermentum et, dapibus sed, urna.

Morbi interdum mollis sapien. Sed ac risus. Phasellus lacinia, magna a ullamcorper laoreet, lectus arcu pulvinar risus, vitae facilisis libero dolor a purus. Sed vel lacus. Mauris nibh felis, adipiscing varius, adipiscing in, lacinia vel, tellus. Suspendisse ac urna. Etiam pellentesque mauris ut lectus. Nunc tellus ante, mattis eget, gravida vitae, ultricies ac, leo. Integer leo pede, ornare a, lacinia eu, vulputate vel, nisl.

Suspendisse mauris. Fusce accumsan mollis eros. Pellentesque a diam sit amet mi ullamcorper vehicula. Integer adipiscing risus a sem. Nullam quis massa sit amet nibh viverra malesuada. Nunc sem lacus, accumsan quis, faucibus non, congue vel, arcu. Ut scelerisque hendrerit tellus. Integer sagittis. Vivamus a mauris eget arcu gravida tristique. Nunc iaculis mi in ante. Vivamus imperdiet nibh feugiat est.

Crypto
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Episode 31
Featuring Chris Burniske
Demetri Kofinas speaks with Chris Burniske about how to value cryptocurrency. How do we differentiate between currencies, DApps, and tokens? How does one judge the merits of a white paper, the seriousness of the dev team, and the enthusiasm of early adopters? How important is governance, supply schedules, and money velocity in valuations?

In this week’s episode of Hidden Forces, host Demetri Kofinas speaks with Chris Burniske about how to value a cryptocurrency. Chris is a co-founder of Placeholder, a New York venture firm that specializes in cryptoassets. Before Placeholder, Chris Burniske pioneered ARK Invest's Next Generation Internet strategy, leading the company to become the first public fund manager to invest in cryptocurrency. He then transitioned to focus exclusively on cryptoassets, paving the way for Wall Street to recognize it as a new asset class. His commentary has been featured on national media outlets, including the Wall Street Journal, the New York Times, Fortune, and Forbes.

 

With the total market capitalization of all cryptocurrency having surpassed $800 billion by the start of 2018, it was only a matter of time before Wall Street would stand up and take notice. The establishment of a cash-settled futures market for bitcoin in late 2017 is one of many bullish signs for the long-term viability of cryptoassets. It has also opened the door to further institutional capital and crypto-focused hedge funds with hundreds of millions of dollars to deploy. The opportunities for profitmaking are too lucrative to ignore, but the flood of institutional and private capital into the cryptocurrency space is also fueling a speculative mania. The newness of this asset class and its lack of historical price data make proper valuations even more challenging. So, given these constraints, the question remains, how do you value cryptocurrency?

 

The answer lies at the intersection of macroeconomics and financial modeling. Chris Burniske and Demetri Kofinas start by laying out a taxonomy for cryptoassets that breaks them into three categories: cryptocurrency, cryptocommodities, and cryptotokens. In their conversation, they explore how one can learn to differentiate between the different currencies, DApps, and tokens. How does one judge the merits of a white paper, the seriousness of the dev team, and the enthusiasm of early adopters? How important is governance? How can volatility in the underlying token impact the robustness of the software? How do supply schedules determine future values? What are some of the most reliable, early indicators of success or failure for a cryptoventure? These are just some of the questions that Demetri and Chris address in this highly informative and timely conversation.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation at @hiddenforcespod

 

 

Chris Burniske is a co-founder of Placeholder, a New York venture firm focused on the economics and governance of cryptonetworks. Prior to Placeholder, he worked at ARK Investment Management as the first buy-side analyst to cover cryptoassets, driving the firm's decision to invest in bitcoin in 2015. 

 

In addition to his work as an investor, Chris co-authored the best-seller, Cryptoassets: The Innovative Investor’s Guide to Bitcoin and Beyond (McGraw Hill, 2017). His commentary has been featured on national media outlets, including the New York Times, Wall Street Journal, Bloomberg, Fortune and more. 

 

@cburniske

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Morbi interdum mollis sapien. Sed ac risus. Phasellus lacinia, magna a ullamcorper laoreet, lectus arcu pulvinar risus, vitae facilisis libero dolor a purus. Sed vel lacus. Mauris nibh felis, adipiscing varius, adipiscing in, lacinia vel, tellus. Suspendisse ac urna. Etiam pellentesque mauris ut lectus. Nunc tellus ante, mattis eget, gravida vitae, ultricies ac, leo. Integer leo pede, ornare a, lacinia eu, vulputate vel, nisl.

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Sed egestas, ante et vulputate volutpat, eros pede semper est, vitae luctus metus libero eu augue. Morbi purus libero, faucibus adipiscing, commodo quis, gravida id, est. Sed lectus. Praesent elementum hendrerit tortor. Sed semper lorem at felis. Vestibulum volutpat, lacus a ultrices sagittis, mi neque euismod dui, eu pulvinar nunc sapien ornare nisl. Phasellus pede arcu, dapibus eu, fermentum et, dapibus sed, urna.

Morbi interdum mollis sapien. Sed ac risus. Phasellus lacinia, magna a ullamcorper laoreet, lectus arcu pulvinar risus, vitae facilisis libero dolor a purus. Sed vel lacus. Mauris nibh felis, adipiscing varius, adipiscing in, lacinia vel, tellus. Suspendisse ac urna. Etiam pellentesque mauris ut lectus. Nunc tellus ante, mattis eget, gravida vitae, ultricies ac, leo. Integer leo pede, ornare a, lacinia eu, vulputate vel, nisl.

Suspendisse mauris. Fusce accumsan mollis eros. Pellentesque a diam sit amet mi ullamcorper vehicula. Integer adipiscing risus a sem. Nullam quis massa sit amet nibh viverra malesuada. Nunc sem lacus, accumsan quis, faucibus non, congue vel, arcu. Ut scelerisque hendrerit tellus. Integer sagittis. Vivamus a mauris eget arcu gravida tristique. Nunc iaculis mi in ante. Vivamus imperdiet nibh feugiat est.

Economics
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Episode 27
Featuring Gary Shilling
How will the Trump tax plan and regulatory reform affect the economy? If treasuries remain in a bull market, what will happen to stocks, commodities, and the dollar in 2018? Perennial bond bull Gary Shilling shares his view in this week's episode of Hidden Forces.

In this week's episode of Hidden Forces, Demetri Kofinas speaks with economist and famous bond bull Gary Shilling, about the ramifications of Donald Trump’s economic policies, the role of cryptocurrencies, and the prospect for stocks, commodities, and the dollar in 2018.

 

Few would reasonably argue that regulatory reform is not needed in the United States. The issue for politicians and policymakers has always been one of balance and practicality. The turbulence of the 1970’s produced a slew of regulatory measures like wage and price controls that proved disastrous for the economy. Likewise, the financial deregulation of the 1980s and 1990s rolled back investor protections that had served to safeguard customer deposits and prevent excessive interconnectivity in the banking system.

 

In the context of the current economic expansion, one must consider the impact that deregulation and higher after-tax income will have on an economy already in its ninth year of economic expansion. With corporations and businesses standing to benefit most from tax cuts proposed by Senate and House Republicans, what do individual tax-filers stand to gain from the Trump tax plan? Are there benefits to rolling back some of the financial regulations passed in reaction to the fallout of the great financial crisis of 2008? What does the employment picture look like for the US economy? How do job prospects and wages fare in the face of rising asset values and growing debt burdens? If Gary Shilling is right and treasuries remain in a bull market, what does this mean for the fate of stocks, commodities, and the US dollar in 2018? Will the price of oil continue its recent rise, or may some combination of weak demand and oversupply hamper prices? How will the Federal Reserve’s ongoing tightening affect the economy and are we destined to see an inversion of the yield curve for 10-year US Treasuries? Gary Shilling also gives us his two cents on bitcoin, and why he thinks the cryptocurrency is massively overvalued.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

A. Gary Shilling is an American financial analyst and commentator who appears on a regular basis in publications such as Forbes magazine, The New York Times and The Wall Street Journal. He is President of A. Gary Shilling & Co., Inc., editor of A. Gary Shilling's Insight, and member of The Nihon Keizai Shimbun Board of Economists. He is featured frequently on business shows on radio and television, and as a recognised orator, addresses conventions of global business groups like the Young Presidents' Organization. He was awarded a Bachelor's Degree in Physics from Amherst College, and a PhD in Economics from Stanford University. He has worked for Thornhill Securities, the Federal Reserve Bank of San Francisco, Merrill Lynch, and White Weld & Co, and Standard Oil Co NJ.

 

In the spring of 1969, he was one of only a few analysts who correctly envisioned the recession at year's end, and was almost a lone voice in 1973, when he forecast a monolithic international inventory-building fling, followed by the first significant recession since the Great Depression.

 

In the late 1970s, while most analysts presumed that waxing inflation would go on unabated, Shilling was the first to predict that America's infirm political climate would impede it. He also foresaw various dangerous economic readjustment problems and a shift in investment strategy from a preference for tangible assets to an increased emphasis on stocks and bonds.

 

In June 2011, he predicted a 20% drop in housing in 2012 with a resulting global recession. In October 2012 he predicted a global recession in 2013.

 

In August 2015, he predicted that the price of oil "is headed for $10 to $20 per barrel" (it was $43/barrel at the time) due to higher productivity through fracking and OPEC not limiting production.

 

@AGaryShilling

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Economics
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Episode 25
Featuring Lacy Hunt
Demetri Kofinas speaks with former Chief US Economist for HSBC, Lacy Hunt, about the macro forces driving the global economy in the 21st century. This conversation relies on a panoply of data as we examine the forces of debt deflation, structural demographics, and historically low savings rates.

In this week’s episode of Hidden Forces, host Demetri Kofinas speaks with Lacy Hunt, Executive Vice President of Hoisington Investment Management Company. For nearly 14 years, Dr. Lacy Hunt was Chief U.S. Economist for HSBC Group, one of the world’s largest banks. He was also Executive Vice President and Chief Economist at Fidelity and held the position of Senior Economist for the Federal Reserve Bank of Dallas.

 

Global Macro is an investment strategy based on the interpretation and prediction of large-scale events. Many such events are driven by chronic conditions, including debt deflation, structural demographics, and low savings rate. What role have governments played in amplifying and perpetuating the impact of these forces by bailing out financial markets and flooding the banking system with cheap money?

 

In order to answer this question, we must rely on a panoply of data, statistics, and econometrics – bank lending, money velocity, monetary aggregates, disposable income, liquidity coverage ratios, and credit spreads. How will we navigate the next recession, having wasted the last 8 years chasing the shadows of wealth through buy-backs, stock appreciations, and financialization? Where will the demand come from in a consumer-led economy still fighting the forces of debt-deflation with diminishing savings rates and rising interest expenses? How will we manage our unfunded liabilities, mortgage payments, rents, and college tuitions, with such poor structural demographics? And how does all of this tie back to the resurgence of populism and the escalation of geopolitical tension in a world bound together by our liabilities but torn apart by the specter of conflict, the failures of diplomacy, and the expediency of war?

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation at @hiddenforcespod

 

Dr. Lacy H. Hunt, an internationally known economist, is Executive Vice President and Chief Economist of Hoisington Investment Management Company (HIMCO), a firm that manages $4 billion for pension funds, endowments, insurance companies and others. 

 

Lacy is the author of two books, and numerous articles in leading magazines, periodicals and scholarly journals. Included among the publishers of his articles are. Barron’s, The Wall Street Journal, The New York Times, The Christian Science Monitor, the Journal of Finance, the Financial Analysts Journal and the Journal of Portfolio Management.  The Board of Governors of the Federal Reserve System and the Dallas Federal Reserve Bank both published his research.    

 

The Wall Street Journal, The New York Times, Business Week, Barron’s, Time, Newsweek, U.S. News and World Report, Investor’s Business Daily and many other domestic periodicals have quoted Lacy.  Among the foreign press, Lacy’s views have appeared in The Financial Times, the Nihon Keizai Shinbun, the South China Post, The International Herald Tribune and The Straight Times.  He has been a guest on PBS on The Nightly Business Report, The News Hour, and Wall Street Week.  He has been on CNN shows Moneyline, and Business Morning and on CNBC’s Squawk Box and World Business.  He has also appeared on CBS Evening News, NBC's Today Show, and ABC's World News Tonight.

 

He has made numerous presentations in all the major financial and economic centers in Europe, Asia, the Middle East, Africa and North America.  He has appeared on radio and television outside of the United States, including The BBC, NHK and TV Tokyo.  Dr. Hunt has testified before various committees of Congress, including House Ways and Means, Senate Finance and Senate Banking.

 

Previously, Lacy was Chief U.S. Economist for the HSBC Group, one of the world’s largest banks, Executive Vice President and Chief Economist at Fidelity Bank and Vice President for Monetary Economics at Chase Econometrics Associates, Inc. Lacy considers himself fortunate that he had the opportunity of working for two firms led by great bankers:  David Rockefeller (Chase) and Sir William Purvis (HSBC). 

 

A native of Texas, Lacy has served as Senior Economist for the Federal Reserve Bank of Dallas.  While at the Dallas Fed, he served on the Federal Reserve System Committees: Financial Analysis and International Economics.  He successfully completed the training program at the Federal Reserve Bank of New York.  When he entered the Fed, William McChesney Martin was grappling with a severe inflation and when he left Author Burns was also trying to contain rampant price increases, virtually the opposite of the challenges facing Janet Yellen and the Fed today.  At the Fidelity Bank of Philadelphia he had the responsibility for managing the Trust Department’s Comingled Fixed Income Fund in the 1970s and early 1980s.  This fund produced one of the highest returns during this inflationary era.  

 

He earned his BA from Sewanee: The University of the South (1964), his MBA from the Wharton School of the University of Pennsylvania (1966), and his Ph.D. in Economics from the Fox School of Business and Management of Temple University (1969).  From Sewanee, he received an honorary Doctor of Civil Laws in 2013 and their Distinguished Alumnus Award in 2016. Lacy served on the Board of Trustees of Temple University from 1987 to 2010 and is now an honorary life trustee. 

 

He received the Abramson Award from the National Association for Business Economics for “outstanding contributions in the field of business economics.” He is a life member of the American Finance Association.  He was a member of the Economic Advisory Board of the American Bankers Association and Chairman of the Economic Advisory Board of the Pennsylvania Bankers Association.  He served on the Monetary and Fiscal Policy Affairs Committee of the National Chamber of Commerce.  He was a member of The Money Marketeers of New York University.

 

The honorary doctorate from Sewanee reads “His career path has included stops at some of the most powerful financial institutions in the country, where he has not only influenced internal investment policy but has left an indelible mark on the nation’s economic policy through his publications, speeches and appearances in the national media.”

 

Lacy and his wife JK (Janet Kay) live in Austin, Texas.  They have four daughters, two sons and three grandsons.  

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Sed egestas, ante et vulputate volutpat, eros pede semper est, vitae luctus metus libero eu augue. Morbi purus libero, faucibus adipiscing, commodo quis, gravida id, est. Sed lectus. Praesent elementum hendrerit tortor. Sed semper lorem at felis. Vestibulum volutpat, lacus a ultrices sagittis, mi neque euismod dui, eu pulvinar nunc sapien ornare nisl. Phasellus pede arcu, dapibus eu, fermentum et, dapibus sed, urna.

Morbi interdum mollis sapien. Sed ac risus. Phasellus lacinia, magna a ullamcorper laoreet, lectus arcu pulvinar risus, vitae facilisis libero dolor a purus. Sed vel lacus. Mauris nibh felis, adipiscing varius, adipiscing in, lacinia vel, tellus. Suspendisse ac urna. Etiam pellentesque mauris ut lectus. Nunc tellus ante, mattis eget, gravida vitae, ultricies ac, leo. Integer leo pede, ornare a, lacinia eu, vulputate vel, nisl.

Suspendisse mauris. Fusce accumsan mollis eros. Pellentesque a diam sit amet mi ullamcorper vehicula. Integer adipiscing risus a sem. Nullam quis massa sit amet nibh viverra malesuada. Nunc sem lacus, accumsan quis, faucibus non, congue vel, arcu. Ut scelerisque hendrerit tellus. Integer sagittis. Vivamus a mauris eget arcu gravida tristique. Nunc iaculis mi in ante. Vivamus imperdiet nibh feugiat est.

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Markets
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Market Forces
Featuring Jim Rickards
Demetri Kofinas speaks with financial analyst and best-selling author Jim Rickards about the IMF and World Bank meetings taking place in D.C., the prospects of war with North Korea, and the future of US-China relations. Jim also shares his thoughts about the changes he expects to see at the Fed as Janet Yellen's term comes to an end.

In this Market Forces segment of Hidden Forces, host Demetri Kofinas speaks with Jim Rickards about a timeline for war with North Korea, de-dollarization, and changes at the Trump Fed. Rickards is the author of multiple New York Times bestsellers including The Death of Money, Currency Wars, and The New Case For Gold. His latest book is The Road To Ruin: The Global Elites' Secret Plan for the Next Financial Crisis. Editor of the Strategic Intelligence newsletter, Jim Rickards is also a member of the advisory board of the Center for Financial Economics at Johns Hopkins. He’s an adviser to the Department of Defense and the U.S. intelligence community on international economics and financial threats and served as a facilitator of the first-ever financial war games conducted by the Pentagon.

 

Jim Rickards believes that the United States may be six to eight months away from a shooting war with North Korea. A conflict on the Korean peninsula may be far more complex and unstable than the public realizes. A recent article by Evan Osnos in the New Yorker Magazine paints a daunting picture of the state of affairs between the Trump administration and the government of Kim Jong-un, characterized by a deep mistrust and hampered by a lack of communication.

 

Still, hopes remain high that the Chinese Communist Party, with its 19th National Congress coming up in less than one week, may be able to apply sufficient leverage in order to stem the crisis. Much was made of this in Mark Bowden’s piece for The Atlantic. Yet, Osnos and others believe that Chinese influence is drastically overstated, while the potential for missteps remain abundant. In a recent news conference at the Pentagon, Secretary of Defense General James Mattis stated that the US has military options to exercise against North Korea that could be “minimally impactful on Seoul.” The implication that some members of the press have drawn, including our guest Jim Rickards, is that the US military may have a “secret weapon,” at its disposal. Unfortunately, the press has a long history of overestimating the efficacy of untested, military technologies. The Reagan administration’s Strategic Defense Initiative comes foremost to mind. Indeed, according to Philip E. Coylse III, who once ran the Pentagon’s weapons-testing program, our anti-ballistic missile defense system “is something the U.S. military, and the American people, cannot depend upon.”

 

Despite this uncertainty, financial markets continue to make new highs. The Nasdaq is up 21% year-to-date and the S&P 500 is up a respectable 13% over the same period, begging the question, “why are financial markets so bad at pricing geopolitical risk?” Demetri believes that such risk pricing is a skill that investors have become particularly incompetent at after decades of geopolitical, round upon round of quantitative easing, nine years of record low federal funds rates, and a growth in passive investment strategies and indexing that have laid the foundations for a violent reversal in equity prices. How will markets react if tensions escalate on the Korean Peninsula? What might the catalyst be for a war with North Korea, and will investors even wait to find out?

 

The truth is that investors have more to worry about than just war with North Korea. The spectrum of de-dollarization continues to create problems for American diplomats and strategists as well, in their efforts to use sanctions over military force. Recently, the Chinese announced the creation of a Yuan-based oil contract that would be convertible into gold. Does Jim Rickards see this as just another sign that countries like China, Russia, and Iran may be closer to the de-dollarization of the global financial system than people realize? And what about Saudi Arabia? Considering the challenges the US-Saudi relationship has faced in recent years, may they also be on the verge of pulling out of the petrodollar?

 

In closing, Jim and Demetri discuss Janet Yellen, Kevin Warsh, and some of the changes that may happen with the Trump Fed. Rickards had previously made the point that Donald Trump has the power to re-shape the Federal Reserve Board in ways we haven’t seen since the days of Woodrow Wilson. The President has control over six of the seven spots on the Fed Board of Governors. Three spots on the Trump Fed are currently empty. Two are occupied by conservatives, including the recently appointed Randal Quarles. As for Janet Yellen, her status at the Trump Fed remains unclear as her term comes up for renewal in January.

 

So, not only is a Trump Fed likely to be populated by Republicans, but it may be led by one as well. Kevin Warsh, a notable skeptic of the data-dependent approach of Janet Yellen, as well as her predecessors Ben Bernanke and Alan Greenspan, may be Trump’s top choice to head the Fed after Yellen’s term runs out in January.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation at @hiddenforcespod

 

James Rickards is the Editor of Strategic Intelligence, a financial newsletter, and Director of The James Rickards Project, an inquiry into the complex dynamics of geopolitics + global capital. He is the author of three New York Times best sellers, The Road To Ruin (2016), The Death of Money (2014), and Currency Wars (2011), and the national best seller, The New Case for Gold (2016), all from Penguin Random House.

 

He is an investment advisor, lawyer, and economist, and has held senior positions at Citibank, Long-Term Capital Management, and Caxton Associates. In 1998, he was the principal negotiator of the rescue of LTCM sponsored by the Federal Reserve. His clients include institutional investors and government directorates. He is an Op-Ed contributor to the Financial Times, Evening Standard, The Telegraph New York Times, and Washington Post, and has been interviewed on BBC, CNN, NPR, C-SPAN, CNBC, Bloomberg, Fox, and The Wall Street Journal. Mr. Rickards is a guest lecturer in globalization and finance at The Johns Hopkins University, Georgetown University, The Kellogg School at Northwestern, and the School of Advanced International Studies. He has delivered papers on risk at Singularity University, the Applied Physics Laboratory, and the Los Alamos National Laboratory. He is an advisor on capital markets to the U.S. intelligence community, and the Office of the Secretary of Defense, and is on the Advisory Board of the Center on Sanctions & Illicit Finance in Washington DC. Mr. Rickards holds an LL.M. (Taxation) from the NYU School of Law; a J.D. from the University of Pennsylvania Law School; an M.A. in international economics from SAIS, and a B.A. (with honors) from Johns Hopkins. He lives in New Hampshire.

 

@JamesGRickards

 

James Ricards on the web:

The James Ricards Project

James Ricards Youtube

James on Speakerhub


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Morbi interdum mollis sapien. Sed ac risus. Phasellus lacinia, magna a ullamcorper laoreet, lectus arcu pulvinar risus, vitae facilisis libero dolor a purus. Sed vel lacus. Mauris nibh felis, adipiscing varius, adipiscing in, lacinia vel, tellus. Suspendisse ac urna. Etiam pellentesque mauris ut lectus. Nunc tellus ante, mattis eget, gravida vitae, ultricies ac, leo. Integer leo pede, ornare a, lacinia eu, vulputate vel, nisl.

Suspendisse mauris. Fusce accumsan mollis eros. Pellentesque a diam sit amet mi ullamcorper vehicula. Integer adipiscing risus a sem. Nullam quis massa sit amet nibh viverra malesuada. Nunc sem lacus, accumsan quis, faucibus non, congue vel, arcu. Ut scelerisque hendrerit tellus. Integer sagittis. Vivamus a mauris eget arcu gravida tristique. Nunc iaculis mi in ante. Vivamus imperdiet nibh feugiat est.

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Sed egestas, ante et vulputate volutpat, eros pede semper est, vitae luctus metus libero eu augue. Morbi purus libero, faucibus adipiscing, commodo quis, gravida id, est. Sed lectus. Praesent elementum hendrerit tortor. Sed semper lorem at felis. Vestibulum volutpat, lacus a ultrices sagittis, mi neque euismod dui, eu pulvinar nunc sapien ornare nisl. Phasellus pede arcu, dapibus eu, fermentum et, dapibus sed, urna.

Morbi interdum mollis sapien. Sed ac risus. Phasellus lacinia, magna a ullamcorper laoreet, lectus arcu pulvinar risus, vitae facilisis libero dolor a purus. Sed vel lacus. Mauris nibh felis, adipiscing varius, adipiscing in, lacinia vel, tellus. Suspendisse ac urna. Etiam pellentesque mauris ut lectus. Nunc tellus ante, mattis eget, gravida vitae, ultricies ac, leo. Integer leo pede, ornare a, lacinia eu, vulputate vel, nisl.

Suspendisse mauris. Fusce accumsan mollis eros. Pellentesque a diam sit amet mi ullamcorper vehicula. Integer adipiscing risus a sem. Nullam quis massa sit amet nibh viverra malesuada. Nunc sem lacus, accumsan quis, faucibus non, congue vel, arcu. Ut scelerisque hendrerit tellus. Integer sagittis. Vivamus a mauris eget arcu gravida tristique. Nunc iaculis mi in ante. Vivamus imperdiet nibh feugiat est.

Markets
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Market Forces
Featuring Rachel Ziemba
Demetri Kofinas speaks with Emerging Markets Analyst Rachel Ziemba. They explore the geopolitical crisis unfolding in North Korea, as well as the falling dollar and the forward volatility of the carry-trade. They also discuss the fragile geopolitical position of Saudi Arabia, with its dwindling foreign exchange reserves.

In this this week’s Market Forces segment, host Demetri Kofinas speaks with Emerging Markets Analyst Rachel Ziemba. Rachel leads Emerging Markets coverage for Roubini Global Economics and writes extensively across all three EM/Frontier regions, as well as about commodities. She has a particular interest in the macroeconomics of oil-exporting nations, including the management of oil wealth, energy-sector supply risks, and China. Rachel has served as an expert member of task forces in the U.S, and the UK on issues ranging from economic sanctions, Chinese security challenges, Egypt and sovereign wealth funds.

 

Today’s conversation begins with a look at North Korea and the geopolitical crisis that is unfolding on the Korean Peninsula. Why are financial markets so bad at pricing geopolitical risk and do governments even have a firm grasp on the evolving threat of a nuclear exchange between the United States and the regime of Kim Jong-un?

 

Our conversation eventually shifts to the matter of the falling dollar. What has been driving the fall in the dollar since the beginning of 2017? Have we seen a bottom or could the dollar fall another five, ten, or even twenty percent from these levels? The greenback has fallen despite a further drop in yields on 10-year and 30-year US treasuries. This is particularly relevant in light of the dollar carry-trade, which has benefited from the Federal Reserve's policy of low interest rates in the United States. How has the dollar's role as a funding currency for emerging markets played a role in the recent rise in equities and bond prices in some of these markets? What can forward volatility and the price of currency swaps tell us about the risk of a snap-back in the dollar carry-trade?

 

Finally, Rachel and Demetri discuss energy markets, specifically the chronically low price of oil and its effects on the oil and natural gas industries in the United States, as well as those abroad. In particular, the two discuss the case of Saudi Arabia, with its dwindling foreign exchange reserves and fragile geopolitical position.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation at @hiddenforcespod

 

Rachel Ziemba is an Adjunct Senior Fellow at the Center for a New American Security (CNAS). Her research focuses on the interlinkages between economics, finance and security issues. Her research topics include coercive economic policies such as sanctions, economic resilience and the role of state-owned investors including sovereign wealth funds.

 

She also serves as the head of emerging markets research at 4CAST-RGE (formerly Roubini Global Economics, a global macro strategy and country risk firm.

 

Rachel has a particular interest in the macroeconomics and foreign policy of China and oil-exporting nations, including the management of national wealth and energy-sector supply risks and resilience. She also does extensive work on global macroeconomic issues, particularly foreign-exchange reserve accumulation, sovereign-wealth management and economic imbalances. Rachel also worked for the Canadian International Development Agency in Cairo, Egypt, and the International Development Research Centre in Ottawa, Canada on development economic issues.

 

Rachel regularly serves as an expert commentator in key media outlets, and her research has been cited by a range of international financial institutions. She has served on a range of task forces aimed to generate policy ideas on Egypt, Middle East policy and economic sanctions.  She is the co-author of “Scenarios for Risk Management and Global Investment Strategies” (with William T. Ziemba), published by Wiley in January 2008.

 

She holds a bachelor’s degree from the University of Chicago with honors, and a Master of Philosophy degree in international relations with a specialization in international political economy from St. Antony’s College, Oxford University.

 

@ReZiemba

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Crypto
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Crypto Forces
Featuring Gil Luria
Demetri Kofinas speaks with Gil Luria about the economics of bitcoin and the role that governments and regulators will play in this emerging market. How can we use information about supply dynamics and business cycles in mining to help us determine the fair market value of a given cryptocurrency?

In this week’s Crypto Forces segment, host Demetri Kofinas speaks with Gil Luria. Gil is the director of institutional equity research at D.A. Davidson and one of the earliest sell-side analysts to cover Bitcoin. Gil Luria provides us with the Wall Street perspective on Bitcoin. This conversation is also a great complement to our recent crypto forces segment with Andrew Keys. We cover the recent run-up in the price of bitcoin, the economics of bitcoin, and the role that governments and regulators will play in this emerging market. How can we use information about supply dynamics and business cycles in mining to help us determine the fair market value of a given cryptocurrency? What does a business cycle for bitcoin mining look like? How do miners invest in new equipment, and how can overinvestment in mining rigs impact future prices?

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation at @hiddenforcespod

 

 

Gil Luria joined D.A. Davidson in March 2017 as Director of Research. Previously Gil was an analyst and head of technology research at Wedbush Securities for 11 years, primarily focused on e-commerce and financial technology companies, having previously covered large U.S. telecommunications companies at Sanford C. Bernstein and as a Manager at Deloitte Consulting. Gil has been a frequent speaker at Blockchain and Bitcoin conferences since 2013, presenting Wall St. to Blockchain professionals, and Blockchain to investment professionals. Gil also makes regular appearances in the media, including CNBC, Bloomberg, Wall Street Journal, The New York Times, and NPR. He holds a Bachelor of Arts degree in Economics from Hebrew University and has an MBA from Columbia Business School.

 

Recent articles with Gil:

 

Bitcoin Extends Rally

Bitcoin Could Reach $98.5k

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Economics
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Economics
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Episode 17
Featuring Robert Johnson
Demetri Kofinas speaks with Robert Johnson about political economy, inequality, and technocracy. How does money drive politics? How have markets and the economy changed in the years after the fall of communism and the rise of the Washington Consensus? Johnson also recounts his famous trade with George Soros against the Bank of England.

In this week’s episode of Hidden Forces, host Demetri Kofinas speaks with Robert Johnson, about the political economy, inequality, and the failings of our technocratic institutions. Dr. Johnson serves as President of the Institute for New Economic Thinking and is a Senior Fellow and Director of the Global Finance Project for the Franklin and Eleanor Roosevelt Institute in New York. Robert Johnson served for many years as a Managing Director for George Soros at Soros Fund Management and was part of the famous team of speculators that broke the bank of England in 1992, forcing the pound out of ERM. He served as Chief Economist of the US Senate Banking Committee under the leadership of Chairman William Proxmire, and before this, as Senior Economist of the US Senate Budget Committee under the leadership of Chairman Pete Domenici.

 

Black Wednesday was almost 25 years ago to the day. How has global finance, international trade, foreign exchange, and financial deregulation changed the landscape of speculation in the years since? How has a decline in productivity, a collapse in marginal costs, a rise in total debt, along with an aging demographic laid the groundwork for a rise in populism? What is the role of experts, and how has faith in technocrats and academics declined in recent years? How do we defend our liberal, democratic institutions absent convincing academics, trustworthy politicians, and inspirational leaders? How do we get the money out of politics when politics is so beholden to money? How do we reform a corrupt government that is in bed with Wall Street – a government that is beholden to multinational corporations and co-mingled with industrial military companies whose very profitability is dependent on multi-billion dollar federal contracts? It is time for us to become educated on how our political economy works, because if we don’t have the knowledge to call out “the experts,” then we are powerless to affect the very changes that we seek to induce.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation at @hiddenforcespod

 

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Episode 18
Featuring Samuel Bowles
Episode 18
Featuring Samuel Bowles

Robert Johnson serves as President of the Institute for New Economic Thinking and a Senior Fellow and Director of the Global Finance Project for the Franklin and Eleanor Roosevelt Institute in New York. Johnson is an international investor and consultant to investment funds on issues of portfolio strategy. He recently served on the United Nations Commission of Experts on International Monetary Reform under the Chairmanship of Joseph Stiglitz.

 

Previously, Johnson was a Managing Director at Soros Fund Management where he managed a global currency, bond and equity portfolio specializing in emerging markets. Prior to working at Soros Fund Management, he was a Managing Director of Bankers Trust Company managing a global currency fund. Johnson served as Chief Economist of the US Senate Banking Committee under the leadership of Chairman William Proxmire (D. Wisconsin). Before this, he was Senior Economist of the US Senate Budget Committee under the leadership of Chairman Pete Domenici (R. New Mexico). Johnson was an Executive Producer of the Oscar winning documentary, Taxi to the Dark Side, directed by Alex Gibney, and is the former President of the National Scholastic Chess Foundation. He currently sits on the Board of Directors of both the Economic Policy Institute and the Campaign for America’s Future. Johnson received a Ph.D. and M.A. in Economics from Princeton University and a B.S. in both Electrical Engineering and Economics from the Massachusetts Institute of Technology.

 

@rjocean

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Sed egestas, ante et vulputate volutpat, eros pede semper est, vitae luctus metus libero eu augue. Morbi purus libero, faucibus adipiscing, commodo quis, gravida id, est. Sed lectus. Praesent elementum hendrerit tortor. Sed semper lorem at felis. Vestibulum volutpat, lacus a ultrices sagittis, mi neque euismod dui, eu pulvinar nunc sapien ornare nisl. Phasellus pede arcu, dapibus eu, fermentum et, dapibus sed, urna.

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Markets
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Markets
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Market Forces
Featuring Marc Faber
Demetri Kofinas speaks with famed investor Marc Faber, about the global wealth gap. They examine the role that central banks, government bailouts, and ultra-low interest rates have played in exacerbating this trend towards inequality and financial instability. The two also discuss the growing instability on the Korean peninsula.

In this week’s Market Forces segment, host Demetri Kofinas speaks with famed investor, commentator, and editor of the Gloom, Boom, and Doom Report, Marc Faber. Though Dr. Faber has been dubbed “Dr. Doom,” by the financial press, he is perhaps most famous for his very accurate timing of the US stock market bottom in March 2009. A veteran of the financial industry, Dr. Faber worked during the 1970’s for White Weld & Company Limited in New York City, Zurich, and Hong Kong. He moved to Hong Kong in 1973. He was a managing director at Drexel Burnham Lambert Ltd Hong Kong from the beginning of 1978 until 1990. In 1990, he set up his own business, Marc Faber Limited, acting as an investment advisor and fund manager. Marc Faber now resides in Chiang Mai, Thailand, though he keeps a small office in Hong Kong.

 

In their nearly hour-long conversation, Marc Faber and Demetri Kofinas discuss the growing wealth and income gap seen across the world, with particular emphasis on the United States. They examine the role that central bank policy, government bailouts, and ultra-low interest rates have played in exacerbating this trend towards inequality and financial system instability. The two discuss Uber, where Demetri draws a parallel between the technology company’s practice of subsidizing its customers at the expense of its investors to the practice of Asian savers subsidizing American consumers during the 2000’s housing boom. Marc Faber expresses a negative outlook for the US dollar in the near-term, taking a strongly bearish view of equities, in particular, the FANG stocks (Facebook, Amazon, Netflix, and Google). He believes that the Federal Reserve, rather than succeed in its efforts to shrink its balance sheet, will be overcome by deflationary events in the market and forced to begin expanding its balance sheet once again. Marc Faber believes that western central banks will look to buy more than just government bonds, CDOs, and government-backed mortgages. He is of the mind that just as the Bank of Japan has come to own two-thirds of the ETF market in Japan, so too can western central banks. Indeed, Marc Faber believes that central banks will do whatever they need to do in order to prevent the financial system from collapsing, and this means “printing more money.”

 

Demetri Kofinas also ask Marc Faber about Bitcoin, and what his views are on cryptocurrencies. Marc also gives his views on gold, structural demographics, populism, and the potential for war in Asia. The two end their conversation with best Marc Faber’s investment advice for anyone looking to navigate the ensuing years of financial turmoil and market volatility.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation at @hiddenforcespod

 

Marc Faber (born February 28, 1946) is a Swiss investor based in Thailand. Faber is publisher of the Gloom Boom & Doom Report newsletter and is the director of Marc Faber Ltd, which acts as an investment advisor and fund manager. Faber also serves as director, advisor, and shareholder of a number of investment funds that focus on emerging and frontier markets, including Asia Frontier Capital Ltd.'s AFC Asia Frontier Fund.

 

@gloomboomdoom

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Sed egestas, ante et vulputate volutpat, eros pede semper est, vitae luctus metus libero eu augue. Morbi purus libero, faucibus adipiscing, commodo quis, gravida id, est. Sed lectus. Praesent elementum hendrerit tortor. Sed semper lorem at felis. Vestibulum volutpat, lacus a ultrices sagittis, mi neque euismod dui, eu pulvinar nunc sapien ornare nisl. Phasellus pede arcu, dapibus eu, fermentum et, dapibus sed, urna.

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Finance History
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Finance History
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Episode 13
Featuring James Grant
Demetri Kofinas speaks with James Grant about the history of interest rates and their relevance in a capitalist economy. How are rates determined? What are the consequences, realized and yet to be discovered, of the extraordinary and actions taken by governments in 2008 to arrest the contraction and restart economic growth?

In this week’s episode of Hidden Forces, host Demetri Kofinas speaks with James Grant. James Grant is a legend of the financial newsletter industry. Once the editor of the yield column in Barron’s, he would leave in 1983 to found Grant’s Interest Rate Observer, two years after the sacred risk-free rate touched just under 20%. This is a level that seems nearly impossible to fathom in today’s world of near-zero and even negative, interest rates. Having observed, reported, and opined on markets for almost 50 years, James Grant represents a bastion of experience and wisdom.

 

In this episode, we stop to listen. We stop to remember a time, in which the extraordinary measures and unprecedented actions of our monetary and fiscal authorities would have seemed unimaginable. We take a hard look at money. How does this shadow of wealth find its value? How is the rate of interest determined, and what is the role of financial markets in facilitating the discovery of that value? What happened, in 2008 and what are the consequences, realized and yet to be discovered, of those very extraordinary and unprecedented actions taken by governments around the world to douse the flames of deflation? What was done in order to contain the contraction and to prevent the discovery of prices? What does the future hold in 2017? What investments does one make, and where might one find opportunity in these oceans of uncertainty?

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation at @hiddenforcespod

 

James Grant (born 26 July, 1946) is an American writer and publisher. The founder of Grant's Interest Rate Observer, a twice-monthly journal of the financial markets, he is the author of Money of the Mind (1992), The Trouble with Prosperity (1996), John Adams: Party of One (2005), Mr. Speaker: The Life and Times of Thomas B. Reed, the Man Who Broke the Filibuster (2011), and The Forgotten Depression (2014) among other works.

 

@GrantsPub

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Volatility
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Episode 5
Featuring Christopher Cole
Demetri Kofinas speaks with fund manager Christopher Cole about the unprecedented levels of mean reversion of financial volatility seen in recent years. This episode is about learning how to embrace and profit from the uncertainty in financial markets.

In this week’s episode of Hidden Forces, host Demetri Kofinas speaks with Christopher Cole about political and financial volatility. Chris is the founder of Artemis Capital and the portfolio manager of the Artemis Vega Fund, which seeks to profit from periods of financial volatility, dislocation, and systemic crisis in financial markets. His core focus is systematic, quantitative, and behavioral based trading of financial volatility derivatives.

 

What is volatility? What accounts for the unprecedented levels of mean reversion in implied volatility that we have seen in financial markets? What accounts for volatility persistence? Demetri and Chris compare spot (historic) volatility to implied (forward) volatility. They look at volatility-of-volatility (vol-of-vol). Christopher Cole presents his opinion that modern portfolio and system rebalancing strategies actually dampen financial volatility. Demetri sees these strategies as increasing volatility in the long-term, which Chris agrees with. Christopher also makes the further point that stocks are overvalued when looked at from enterprise value to EBITDA, Case Schiller PE, Price to Book, Price to Sales, etc. He also believes that financial volatility could come from either the left or right tail of the distribution. We could have inflation or deflation, according to Christopher. His objective is to profit regardless of whether we get a move upwards or downwards in prices. What is the best way to carry volatility and go long uncertainty?

 

The concepts discussed in this episode may appear complicated, but they are really rather simple. What listeners need to remember is that volatility is just change. Volatility reflects uncertainty, and we live in uncertain times. This episode is about learning how to embrace this uncertainty. It is about learning how to embrace change. It is an episode about learning how to profit from risk by capitalizing on the unknown.

 

Producer & Host: Demetri Kofinas

Editor & Engineer: Stylianos Nicolaou

Join the conversation at @hiddenforcespod

 

Christopher R. Cole, CFA is the founder of Artemis Capital Management LP and the CIO of the Artemis Vega Fund LP. Mr. Cole’s core focus is systematic, quantitative, and behavioral based trading of volatility and derivatives. His objective is to profit from turbulence in markets and regime shifts in volatility without the substantial negative bleed associated with traditional hedging products. His decision to form a fund came after achieving significant proprietary returns during the 2008 financial crash trading volatility futures and options (verified by independent auditor).

 

Mr. Cole's volatility research was deemed influential in derivatives circles and thereafter widely quoted by the mainstream financial press. His 2012 research paper entitled, “Volatility at World’s End” argued the equity options market was mis-pricing and hedging the wrong tail (left as opposed to right). The paper was credited with re-pricing long-dated volatility, and is considered one of the best macro-economic thought pieces of the last decade. His 2017 paper "Volatility and the Alchemy of Risk" warns about self-reflexivity in the $2 trillion global short volatility trade.

 

Mr. Cole is a frequent speaker at industry conferences and in the media including Grant's Rate Observer, WSJ, Financial Times, and RealVision. He previously worked in capital markets at Merrill Lynch and structured over $10 billion in derivatives and debt transactions.

 

Mr. Cole is a self-taught investor, with no formal schooling, instead relying on independent study, empirical and quantitative research, programming, and experimentation with proprietary capital. Mr. Cole holds the CFA designation and graduated Magna Cum Laude from the University of Southern California with a focus in cinematography. He is a member of E.O. and a 2018 inductee into the Volatility Investing Hall of Fame.

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Suspendisse mauris. Fusce accumsan mollis eros. Pellentesque a diam sit amet mi ullamcorper vehicula. Integer adipiscing risus a sem. Nullam quis massa sit amet nibh viverra malesuada. Nunc sem lacus, accumsan quis, faucibus non, congue vel, arcu. Ut scelerisque hendrerit tellus. Integer sagittis. Vivamus a mauris eget arcu gravida tristique. Nunc iaculis mi in ante. Vivamus imperdiet nibh feugiat est.

Markets
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Episode 2
Featuring James Rickards
Demetri Kofinas speaks with Jim Rickards, as the two explore the history of finance and the deregulation of financial markets. They address one of economics professions' greatest weaknesses, namely, the desperate need for better modeling. How can new economic theories help improve or replace our broken models?

In this week’s episode of Hidden Forces, host Demetri Kofinas speaks with New York Times bestselling author and financial commentator, Jim Rickards. Jim is the author of multiple New York Times bestsellers including The Death of Money, Currency Wars, and The New Case For Gold. His latest book is The Road To Ruin: The Global Elites' Secret Plan for the Next Financial Crisis. He is the editor of the Strategic Intelligence newsletter and a member of the advisory board of the Center for Financial Economics at Johns Hopkins. He’s an adviser to the Department of Defense and the U.S. intelligence community on international economics and financial threats and served as a facilitator of the first-ever financial war games conducted by the Pentagon.

 

Jim and Demetri explore financial history stretching back to some of the earliest economic philosophers. They recall the deregulation of US financial system from the time of Bretton Woods, through the financial panics in Asia in the late 1990s to the Financial Crisis of 2008. Jim Rickards address one of the economics professions' greatest weaknesses, namely, the desperate need for better modeling. What can complexity theory, Bayesian analysis, and behavioral psychology tell us about our world? How can these theories help improve or replace our broken models? The two end with projections about the future. Jim gives his rationale for why he believes the next crisis will be larger and could run deeper than what any of us might imagine. 

 

Producer & Host: Demetri Kofinas

Editor: Connor Lynch

Engineering: Ignacio Lecumberri

Join the conversation at @hiddenforcespod

 

 

James Rickards is the Editor of Strategic Intelligence, a financial newsletter, and Director of The James Rickards Project, an inquiry into the complex dynamics of geopolitics + global capital. He is the author of three New York Times best sellers, The Road To Ruin (2016), The Death of Money (2014), and Currency Wars (2011), and the national best seller, The New Case for Gold (2016), all from Penguin Random House.

 

He is an investment advisor, lawyer, and economist, and has held senior positions at Citibank, Long-Term Capital Management, and Caxton Associates. In 1998, he was the principal negotiator of the rescue of LTCM sponsored by the Federal Reserve. His clients include institutional investors and government directorates. He is an Op-Ed contributor to the Financial Times, Evening Standard, The Telegraph New York Times, and Washington Post, and has been interviewed on BBC, CNN, NPR, C-SPAN, CNBC, Bloomberg, Fox, and The Wall Street Journal. Mr. Rickards is a guest lecturer in globalization and finance at The Johns Hopkins University, Georgetown University, The Kellogg School at Northwestern, and the School of Advanced International Studies. He has delivered papers on risk at Singularity University, the Applied Physics Laboratory, and the Los Alamos National Laboratory. He is an advisor on capital markets to the U.S. intelligence community, and the Office of the Secretary of Defense, and is on the Advisory Board of the Center on Sanctions & Illicit Finance in Washington DC. Mr. Rickards holds an LL.M. (Taxation) from the NYU School of Law; a J.D. from the University of Pennsylvania Law School; an M.A. in international economics from SAIS, and a B.A. (with honors) from Johns Hopkins. He lives in New Hampshire.

 

@JamesGRickards

 

James Ricards on the web:

The James Ricards Project

James Ricards Youtube

James on Speakerhub

 

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Sed egestas, ante et vulputate volutpat, eros pede semper est, vitae luctus metus libero eu augue. Morbi purus libero, faucibus adipiscing, commodo quis, gravida id, est. Sed lectus. Praesent elementum hendrerit tortor. Sed semper lorem at felis. Vestibulum volutpat, lacus a ultrices sagittis, mi neque euismod dui, eu pulvinar nunc sapien ornare nisl. Phasellus pede arcu, dapibus eu, fermentum et, dapibus sed, urna.

Morbi interdum mollis sapien. Sed ac risus. Phasellus lacinia, magna a ullamcorper laoreet, lectus arcu pulvinar risus, vitae facilisis libero dolor a purus. Sed vel lacus. Mauris nibh felis, adipiscing varius, adipiscing in, lacinia vel, tellus. Suspendisse ac urna. Etiam pellentesque mauris ut lectus. Nunc tellus ante, mattis eget, gravida vitae, ultricies ac, leo. Integer leo pede, ornare a, lacinia eu, vulputate vel, nisl.

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Sed egestas, ante et vulputate volutpat, eros pede semper est, vitae luctus metus libero eu augue. Morbi purus libero, faucibus adipiscing, commodo quis, gravida id, est. Sed lectus. Praesent elementum hendrerit tortor. Sed semper lorem at felis. Vestibulum volutpat, lacus a ultrices sagittis, mi neque euismod dui, eu pulvinar nunc sapien ornare nisl. Phasellus pede arcu, dapibus eu, fermentum et, dapibus sed, urna.

Morbi interdum mollis sapien. Sed ac risus. Phasellus lacinia, magna a ullamcorper laoreet, lectus arcu pulvinar risus, vitae facilisis libero dolor a purus. Sed vel lacus. Mauris nibh felis, adipiscing varius, adipiscing in, lacinia vel, tellus. Suspendisse ac urna. Etiam pellentesque mauris ut lectus. Nunc tellus ante, mattis eget, gravida vitae, ultricies ac, leo. Integer leo pede, ornare a, lacinia eu, vulputate vel, nisl.

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