The Business Cycle and More…

Published on: October 21st, 2017


  • RC
    Ronald C.
    27 October 2017 @ 21:44
    I wonder...with the CB flooding the world with liquidity whether modeling the ISM should include the effects of CB largesse to account for extension of the ISM to the upside and triggering a downside when the punchbowl gets taken away
  • SD
    S D.
    23 October 2017 @ 02:38
    Can I please clarify? Call purchase on Eurodollar futures contract - this is an option to buy a futures contract expecting that the rate paid on US dollars parked in EU banks will fall? Or that the price of the 3 month Eurodollar futures contract will rise? Apologies for not immediately getting this. I'm also wondering if there is an ETF you would recommend to pursue this trade. I also would like to know if this is similar to the widely held view that Eu junk bonds are going to have to decline rapidly, with Draghi due to speak on Thursday. Is there a trade you recommend for exposure to that move, or is this trade your recommended exposure, because it sounds extremely significant.
    • SD
      S D.
      23 October 2017 @ 02:41
      Sorry, to be clear, is there another trade you can recommend for exposure to this weird situation in the EU junk bond market? I'm seeing a lot of comment that this is the trigger for a rout in the bond market, and would REALLY appreciate your thoughts on this. It sounds like a big screaming deal and with Draghi due to speak and confidence so low, should we expect a major move this week?
    • RP
      Raoul P. | Founder
      23 October 2017 @ 10:41
      Hi Sarah, it is the cal options on 3m interest futures called Eurodollars. Eurodollars are the worlds most actively traded futures contract and broadly represent US short term interest rates. The trade is for the futures to rise which equals interest rates falling. It is not to do with Euro the currency. Hope that helps
    • JL
      J L.
      23 October 2017 @ 17:20
      Regarding the eurodollar options it would be great if you could give a rough idea of what would be a prudent/aggressive sizing as a % of AUM. I know it is a subjective question but an opinion on those boundaries would be appreciated, and also how the move in risk/reward from 10 to 1 to currently about 20 to 1 would influence sizing. Many thanks
    • SD
      S D.
      23 October 2017 @ 20:08
      Thank you!
    • RP
      Raoul P. | Founder
      27 October 2017 @ 19:25
      Sizing is a personal thing... I think 0.5% to 1% of NAV is decent but wont kill you if its wrong but could make a nice profit if its right.
  • DG
    Don G.
    24 October 2017 @ 00:48
    HI Raoul, UUP is pretty close to $24.50 if we add to the trade where would you place the stop? Where should we look to take profits in this trade?
    • DW
      Daniel W.
      26 October 2017 @ 19:24
      He said he was looking for 120 on the DollarIndex Future.
    • RP
      Raoul P. | Founder
      27 October 2017 @ 19:24
      UUP should not trade below 24 again or something is wrong. Upside targets, i'll leave that to you... I cant run your risk profile
  • SA
    Sandeep A.
    27 October 2017 @ 01:38
    Raoul, Great call on USD! At what point will you consider adding to the XOM trade you had recommended earlier?
    • RP
      Raoul P. | Founder
      27 October 2017 @ 19:23
      Plenty of tie for that... lets see the core thesis get proven a bit first
  • CY
    C Y.
    26 October 2017 @ 19:49
    UUP inverse head and shoulders complete. party on
  • DG
    Don G.
    24 October 2017 @ 00:48
    HI Raoul, UUP is pretty close to $24.50 if we add to the trade where would you place the stop? Where should we look to take profits in this trade?
  • BR
    Bernard R.
    21 October 2017 @ 18:15
    Yield curve steepening? Long term rates going up or short term rates going down? Please elaborate. Love your work!
    • RP
      Raoul P. | Founder
      23 October 2017 @ 10:47
      See reply above
    • MS
      Morten S.
      23 October 2017 @ 10:56
      Short term rates going down. Long rates might fall as well, but not as fast as short term rates. Cheers.
  • WD
    Wim D.
    21 October 2017 @ 19:31
    Agree with this framework, however if this plays out gold will not do well (usd/jpy. Or am I wrong?
    • RP
      Raoul P. | Founder
      23 October 2017 @ 10:47
      My view is that gold sells off initially but really begins to rally when more QE becomes an option. I also think that the dollar rallies too, which would be very rare but is based on the offshore dollar funding shortage but then the dollar should weaken and gold continue higher. These are just views and we have to see how they pan out.
  • AG
    Abhimanyu G.
    22 October 2017 @ 00:41
    Dear Raoul, Could you please shed some light on why the yield curve steepens (after hitting a low) during a recession? Is it because the CB would have started back-peddling on rates by then? Thank you!
    • GS
      George S.
      22 October 2017 @ 22:00
      Check Insider Talks (August) - he explains it there thoroughly.
    • RP
      Raoul P. | Founder
      23 October 2017 @ 10:45
      Actually, it is often two fold. Firstly, there is often a sell off in the 10 yr bond as the market gets the final inflation fear and the Fed are hiking and then the two year bond starts to rally faster than the 10 yr as those rate hikes begin to get priced out.
  • RL
    Robert L.
    23 October 2017 @ 07:04
    Well written report. However, there seems to be an underlying contradiction between the business cycle framework which has been outlined in the past and thus the current indicators would point to a much more optimistic view but instead recently and in this report, stretches are being made to support the broader more pessimistic view, which has been wrong for 1-2 years (on US equities in USD dollars). In the next meeting of the minds, it could be useful to layout a few scenarios where the team could be wrong.
  • NH
    Neil H.
    21 October 2017 @ 17:17
    Always clear and precise. Keep it up

Mark Yusko

Morgan Creek Capital Management, Co- Founder, CEO, & CIO

Mark Yusko is the Founder, CEO and Chief Investment Officer of Morgan Creek Capital Management. He is also the Managing Partner of Morgan Creek Digital Assets.

Morgan Creek Capital Management was founded in 2004 and currently manages close to $2 billion in discretionary and non-discretionary assets. Prior to founding Morgan Creek, Mr. Yusko was CIO and Founder of UNC Management Company (UNCMC), the Endowment investment office for the University of North Carolina at Chapel Hill. Before that, he was Senior Investment Director for the University of Notre Dame Investment Office. Mr. Yusko has been at the forefront of institutional investing throughout his career. An early investor in alternative asset classes at Notre Dame, he brought the Endowment Model of investing to UNC, which contributed to significant performance gains for the Endowment. The Endowment Model is the cornerstone philosophy of Morgan Creek, as is the mandate to Invest in Innovation.

Mr. Yusko is again at the forefront of investing through Morgan Creek Digital Assets, which was formed in 2018. Morgan Creek Digital is an early stage investor in blockchain technology, digital currency and digital assets through the firm’s Venture Capital and Digital Asset Index Fund.

Mr. Yusko received a BA with Honors from the University of Notre Dame and an MBA in Accounting and Finance from the University of Chicago.

Anthony Scaramucci

SkyBridge Capital, Founder & Co-Managing Partner

Prior to founding SkyBridge in 2005, Scaramucci co-founded investment partnership Oscar Capital Management, which was sold to Neuberger Berman, LLC in 2001. Earlier, he was a vice president in Private Wealth Management at Goldman Sachs & Co. In 2016, Scaramucci was ranked #85 in Worth Magazine’sPower 100: The 100 Most Powerful People in Global Finance. In 2011, he received Ernst & Young’s “Entrepreneur of the Year –New York” Award in the Financial Services category. Anthony is amember of the Council on Foreign Relations (CFR), vice chair of the Kennedy Center Corporate Fund Board, a board member of both The Brain Tumor Foundation and Business Executives for National Security (BENS), and a Trustee of the United States Olympic & Paralympic Foundation. He was a member of the New York City Financial Services Advisory Committee from 2007 to 2012. In November 2016, he was named to President-Elect Trump’s 16-person Presidential Transition Team Executive Committee. In June 2017, he wasnamed the Chief Strategy Officer of the EXIM Bank. He served as the White House Communications Director for a period in July 2017. Scaramucci, a native of Long Island, New York, holds a Bachelor of Arts degree in Economics from Tufts University and a Juris Doctor from Harvard Law School.

Michael Saylor

MicroStrategy, Co-Founder

Mr. Saylor is a technologist, entrepreneur, business executive, philanthropist, and best-selling author. He currently serves as Chairman of the Board of Directors and Chief Executive Office of MicroStrategy, Inc. (MSTR). Since co-founding the company at the age of 24, Mr. Saylor has built MicroStrategy into a global leader in business intelligence, mobile software, and cloud-based services. In 2012, he authored The Mobile Wave: How Mobile Intelligence Will Change Everything, which earned a spot on The New York Times Best Sellers list.

Mr. Saylor attended the Massachusetts Institute of Technology, receiving an S.B. in Aeronautics and Astronautics and an S.B. in Science, Technology, and Society.

Alex Saunders

Nugget's News, Founder & CEO

Alex Saunders is the founder and CEO of Nugget’s News, a digital media company focused on all things crypto. Alex has been captivated by cryptocurrency since 2012 and in 2017 he began educating globally on the benefits of cryptocurrency and how to safely acquireit. Nugget’s News has been listed as a top-20 podcast by Business Insider, ShapeShift and Lifehacker and has over 120k YouTube subscribers with 9 million total views.Alex is also heavily focused on his cryptocurrency education platform Collective Shift which currently serves over 4,500 members. provides his unique perspectives by utilising his expertise in fundamental analysis, technical analysis and market sentiment. He is working towards his mission of making it easier for everyone to understand the financial world.

James Putra

TradeStation Crypto, Inc., Sr. Director of Product Strategy

James helped launch TradeStation Crypto’s offering which utilizes a true online brokerage model that self-directed investors and traders have come to expect for equities, futures, and foreign currency markets. He is a reputed crypto asset specialist and blockchain thought leader focused on helping people find innovative ways to participate in this space. He is active in the blockchain community with speaking engagements, TV appearances and mentoring. James has over 15 years of experience in the Fintech industry.

Raoul Pal

Real Vision, Co-Founder & CEO

Raoul Pal is the Co-Founder and CEO of Real Vision, the world’s pre-eminent financial media platform, which helps members understand the complex world of finance, business, and the global economy.

Real Vision members also have access to Real Vision Crypto, a cryptocurrency and digital assets video channel watched by over 80,000 people. In addition, Raoul has been publishing Global Macro Investor since January 2005 to provide original, high quality, quantifiable and easily readable research for the global macro investment community hedge funds, family offices, pension funds and sovereign wealth funds. It draws on his considerable 31 years of experience in advising hedge funds and managing a global macro hedge fund. Global Macro Investor has one of the very best, proven track records of any newsletter in the industry, producing extremely positive returns in eight out of the last twelve years.

He retired from managing client money at the age of 36 in 2004 and now lives in the tiny Caribbean island of Little Cayman in the Cayman Islands. Previously he co-managed the GLG Global Macro Fund in London for GLG Partners, one of the largest hedge fund groups in the world. Raoul moved to GLG from Goldman Sachs where he co-managed the hedge fund sales business in Equities and Equity Derivatives in Europe. In this role, Raoul established strong relationships with many of the world’s pre-eminent hedge funds, learning from their styles and experiences.

Other stop-off points on the way were NatWest Markets and HSBC, although he began his career by training traders in technical analysis.

Peter McCormack

What Bitcoin Did, Journalist

Peter McCormack is a full time journalist/podcaster covering topics such as Freedom, Human Rights, Censorship and Bitcoin. Peter created and hosts the What Bitcoin Did Podcast, a twice-weekly Bitcoin podcast where he interviews experts in the world of Bitcoin development, privacy, investment and adoption. Launched in November of 2017, the podcast has grown to over 100 episodes with a guest list that is a testament to the diversity of knowledge and opinions that represent the broader Bitcoin community. Expanding his growing list of human interest recordings, documentaries and films Peter has recently launched the Defiance podcast and DefianceTV.

Caitlin Long

Avanti Financial Group, Founder & CEO

22-year Wall Street veteran who has been active in bitcoin and blockchain since 2012. In 2018-20 she led the charge to make her native state of Wyoming an oasis for blockchain companies in the US, where she helped Wyoming enact 20 blockchain-enabling laws. From 2016-18 she jointly spearheaded a blockchain project for delivering market index data to Vanguard as chairman and president of Symbiont, an enterprise blockchain start-up. Caitlin ran Morgan Stanley’s pension solutions business (2007-2016), heldsenior roles at Credit Suisse (1997-2007) and began her career at Salomon Brothers (1994-1997). She is a graduate of Harvard Law School (JD, 1994), the Kennedy School of Government (MPP, 1994) and the University of Wyoming (BA, 1990).

Hunter Horsley

Bitwise Asset Management, CEO

Hunter Horsley is Chief Executive Officer of Bitwise Asset Management. Prior to Bitwise, he was a product manager at Facebook, working on advertiser products including the multibillion-dollar sponsored content ecosystem and ad breaks in videos. Before Facebook, Horlsey was a product manager at Instagram, responsible for multiple advertising products generating several hundred million dollars of revenue. He is a graduate of the Wharton School at the University of Pennsylvania, with a B.S. in economics. Recently, Horsley was named a member of Forbes’ 2019 “30 Under 30” list.

Luke Gromen

Forest For The Trees, Founder & President

Luke Gromen has 25 years of experience in equity research, equity research sales, and as a macro/thematic analyst. He is the founder and president of macro/thematic research firm FFTT, LLC, which he founded in early 2014 to address and leverage the opportunity he saw created by applying what clients and former colleagues consistently described as a “unique ability to connect the dots” during a time when he saw an increasing “silo-ing” of perspectives occurring on Wall Street and in corporate America.

FFTT caters to institutions and sophisticated individuals by aggregating a wide variety of macroeconomic, thematic and sector trends in an unconventional manner to identify investable developing economic bottlenecks for his clients. Prior to founding FFTT, Luke was a founding partner of Cleveland Research Company, where he worked from 2006-14. At CRC, Luke worked in sales and edited CRC’s flagship weekly thematic research summary piece (“Straight from the Source”) for the firm’s clients. Prior to that, Luke was a partner at Midwest Research, where he worked in equity research and sales from 1996-2006. While in sales, Luke was a founding editor of Midwest’s widely-read weekly thematic summary (“Heard in the Midwest”) for the firm’s clients, in which he aggregated and combined proprietary research from Midwest with inputs from other sources.

Luke Gromen holds a BBA in Finance and Accounting from the University of Cincinnati and received his MBA from Case Western Reserve University. He earned the CFA designation in 2003.

Meltem Demirors

CoinShares, Chief Strategy Officer

Meltem Demirors is Chief Strategy Officer of CoinShares, an investment firm that manages billions in assets on behalf of a global investor base, and is a trusted partner to investors and entrepreneurs navigating the digital asset ecosystem. Meltem oversees the firm’s managed strategies group and its New York office and leads corporate development.

Previously, she was part of the founding team of Digital Currency Group. As a veteran investor in the digital currency space, she has invested in over 250 companies in the ecosystem.

Meltem is passionate about education and advocacy, and teaches the Oxford Blockchain Strategy Programme and co-chairs the WEF Cryptocurrency Council.