Videos Of The Week
Videos Of The Week
Debt And Market Cycles, Artificial Intelligence Capex & Questions On 9/11
Last week was a bit of a bloodbath in markets, especially in the energy sector. Price drives narrative as they say, but I’ll be talking some more about that in my post tomorrow. We have the Presidential Debate on Tuesday and we have less than two months to the election now. We will see if it’s a train wreck like the debate between Trump and Biden. If you have any suggestions for a drinking game, feel free to leave a comment. It should be entertaining to say the least. It looks like polls are starting to swing in Trump’s favor, but we will see where those stand after the debate.
On current events, it’s more of the same. Ukraine looks like they are in trouble and the Middle East isn’t showing any signs of calming down. Apparently, the US warned Israel that aircraft carriers can’t stay “indefinitely”. For more color on Ukraine, I’ll point readers to
’ recent update on Ukraine. When you have major moves in Zelensky’s cabinet, Russia advancing at a quicker pace, and the ill-advised Kursk attack faltering, it looks like things are deteriorating quickly.Market Huddle w/ Dario Perkins
This was an interesting conversation on where we are in the business cycle, and why this cycle is not like previous cycles. Dario went through a whole bunch of leading indicators that haven’t worked this time around, and the huge distortions in the economy and the data from pandemic shutdowns. He thinks it looks like a 1995 environment (I can’t opine on that since I wasn’t following markets back then), but he’s still expecting a soft landing. He does think there is a higher recession risk than two years ago.
They also talk about the credit cycle that hasn’t cycled and why he thinks we are in a secular bear market for bonds that started several years ago. Obviously that means something different short term with the expected rate cuts, but he doesn’t think we are going back to ZIRP. I agree with his take that we are in a different regime, and bonds aren’t going to be the portfolio insurance they used to be. It might work over the next year, but I think buying long term bonds and holding until 2030 is playing with fire. The last point that he made that I thought was interesting was his thoughts on future supply shocks causing more frequent recessions over the next decade.
You had a yield curve which was massively inverted, and it was inverted because central banks tightened aggressively, and then were looking to cut interest rates. An inverted yield signals rate cuts, it doesn’t signal recession. There’s been periods where you’ve had inversions and you have not had recessions, because the central bank has cut rates.
- Dario Perkins
Wall Street For Main Street w/ Mayhem
This was an interesting conversation on a bunch of different topics. AI spending was a topic they focused on, and the big question mark on if it will pay off for the companies that have been busy pumping money into it over the last couple years. They also talk about interest rates, the impact of the expected rate cuts, and the potential for a recession. One of the other things they touched on briefly was the Presidential election and how that might impact things.
Hidden Forces w/ Ray Nowosielski & John Duffy
This one is a bit of an honorable mention that wasn’t related to investments. 9/11 is one of the topics I have been down the rabbit hole on, and this was an interesting video on the topic. They discussed Saudi Arabia and their connections to the event and the alphabet soup agencies (my phrase there) not communicating with one another in the months leading up to 9/11. I was disappointed they didn’t talk about Building 7, but it was an interesting conversation to listen to.