Comments
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MCSopunds like he has just reversed his negative view. Would be interesting to hear what drove this? CNY has been quite strong.
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fTWhats a mini short squeeze
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SBI think Mark's logic is dead on and he'll ultimately be proven right... but now that almost a year has gone by and the sharp CNY devaluation has yet to happen, I'd love to get his current take. Seems like global central bank coordination staved off the need for a sharp deval back in February ("Shanghai Accords")... please get him back on RV pronto!
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MLyou can buy 3 different CNY or CNH put options at the SIX (Swiss Exchange) denominated in USD - check the following ISIN: CH0283710884, CH0259488713 or CH0259490883
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LAThank u Mark! I enjoyed getting a truncated lesson in global macro economics & specifically the "carry-trade". U are a smart, impressionable & humble person.
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GADon't have access to currency options & the roll charge for shorting CNH prohibitivly expensive in my forex account. Any thoughts on shorting HKD? Will they necessarily devalue it along with the yuan?
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SMMark, or anyone, can you comment on perspective in this article -- that western bias is causing us to miss what China is actually up to?https://www.goldmoney.com/shorting-the-yuan-is-dangerous
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CMI really enjoyed this interview. Replayed several sections - very educational. RV is my new graduate school.
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PB3rd time watching this
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LPInteresting trade here, as Hendry and Louis-Vincent Gave have a different perspective.
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AGI heart Hart! Big deval will come, but Chinese have to give local companies a chance to prepare / wait for contracts to mature (otherwise huge losses at importers/exporters possible)
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DKWould also be interrested in knowing if there's a US retail broker offering yuan options
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RWThe January 24th "Thoughts From The Frontline" by John Mauldin gives the steady as she goes slow rate change argument if anyone is interested. You can google it.
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FC@Ian, I have nothing against Hugh Hendry. I saw this link and I felt curious and hence mentioned the same here - http://www.eclectica-am.com/fund-statistics-eamf Best wishes.
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IF@DHIREN - Frighteningly your math must be bad. Eclectica is one of the longest running London Macro Funds at 14 years with 8% CAGR. Hendry's 2016 Outlook: https://www.youtube.com/watch?v=ZWz_Pln_uuI
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DSMark also demonstrates putting on a good trade ...with an excellent favourable risk to reward ratio, + He's extra clear on his view. What a great example. Thank you MH and RV
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FCFwiw, Hugh Hendry fund has a CAGR of 2.47% since inception.
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SSYou both are such interesting thinkers and can express the issues so well. Thank you.
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IFMy favorite hedge fund manager Hugh Hendry is taking the other side of the trade. His interview here: http://www.bloomberg.com/news/videos/2015-10-07/markets-most-influential-investment-outlook-panel
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JHif the Chinese leave their banks, its an easy stretch to say physical gold will move up. But, will this move break, once and for all, the western paper gold manipulation? maybe force a raid on comex?
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MCEither the Chinese government declares Bitcoin to be it's national currency or the citizens will. Outflows into BTC have already commenced. I know this is bold but none the less, possible!
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DSWhat's to say: Brilliant!! ...Long Hart!!!
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FCany brokers that offer options on forex in the US? Thanks
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TBMark is a fantastic mind. However, I'm concerned by the comments of almost sycophantic proportions on this thread. Where's the discomforming evidence, the counterfactuals and the debate!?!
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TTSorry Mark and Grant, didn't mean to be so curt with prior comment - would have enjoyed a more free ranging discussion of anything and everything interesting to you Mark. Good luck with the trade :)
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RLWon't be able to sleep after watching that. He's 100% right. Its sterling 1992 on a massive scale.
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jmVarun, in his first interview he explains how to trade this. He buys 7 strike out of the money yuan puts 6 months to one year and a half out
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SLUSD/JPY weaker. Maybe China waits for the next BOJ shoe to drop and then devalues. Lots of cover then.
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dbThis makes me wonder if the US is suppressing gold for China in exchange for China agreeing not to devalue the Yuan. Perhaps oil as well giving China time to pick off oil reserves at the low.
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dbhttp://seekingalpha.com/article/3440886-further-devaluation-of-the-yuan-will-drive-gold-prices-higher
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RMI would like to know what I should study to get the framework that Mark, Raoul, and Grant all come up with.
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VKDid anybody get how he is playing this trade? Buy Puts on RMB futures (around 7 Yuan or more; 6-12 months out) as traded on CME?
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TTPrefer a conversation format personally
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CMAs usual, outstanding! By far, the best of the best you got out there on RV. @RV Agreed on the possibility to broaden the rationale towards other assets/asset classes
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KEDoes it really matter if you are short yuan or any other major developed stock market. Wouldn't a sharp yual deval take a lot of those markets A LOT lower??
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JAWhere does he get the estimated data in regards to the FX intervention in the first 12 days of January???
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FJAssuming Mark is right ,what happens to the price of gold? Especially considering the amount of gold China has in reserves, along with the other BRIC nations. Frank
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tWIMHO, If you liked this, must read perfect companion piece by RV contributor @WorthWray of @EvergreenGK 'For What It's Worth'1/15/16 http://bit.ly/1PoaHmg
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GMInteresting how one-sided all the comments are. Nothing can be that assured (effects of CNY deval). Agree that Mark is brilliant. Thank you RVTV for having him on. We are lucky to have access!
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RMPart 2 - (previous comment box to short to finish) - Fantastic interview, Mark is definitely one brilliant yet humble guy! Thanks for having him on RV!
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RMPerhaps they are delaying the deval while they quietly tell all the SOE's and public/private equity/corp's to convert their US$ based loans to CNY loans so they don't get killed on the deval.
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MAGreat interview, one of the smartest guys around. Anyone know why he opted for puts rather than calls? or are they just priced that much cheaper?
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bpVery good interview, would really love to see him back on RV this year for an update on the rest of the world!
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RAMaybe my expectations were too high (after 2014 interview) but this interview felt somewhat short of it. Would have been nice to see 5-10 min Mark's view on 2016 and the rest of the world
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TLAA you can buy yuan puts = USDCNH calls at Saxo with a welcome bonus through this link: http://uk.saxomarkets.com/iit-dcf/referral/?RefId=05C34E88-9E1E-40E5-A3DF-3E629C0B96DE&cmpid=GLOBAL-REF-UK
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GTAnyone made a call to Xi ? "Hello is that Mr Hart? its President Xi here"
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MSSimply stunning analysis. Real Vision has done it again. For about the 100th time.
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SDMark is 100% right about the Asian crosses.But the quanta mentioned are too wild. CNY is 20% above a 10 year average versus Yen, 12% above Korean won and 10% versus Taiwan $.
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Sreally awesome, talk about knock on effects, if Fed were required to do QE4(as a result of the deval), I think we can agree that it's going to get very ugly out there.
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JSDomestic savers should be shielded from a devaluation to some extent by their substantial gold holdings.
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BJ1 of my 1st comments after meeting Mark was my belief CNY would need to deval. At time I didnt know his thesis or positioning. He simply said "me too". Smartest guys in the room are always quietest
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CDHas played out exactly as he stated in his previous interview from last year. Would love to know more of what he thinks are the "knock on effects" for world markets. Equities, treasuries, credit etc!
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RPGreat interview! Thanks for your insights and thoughts. Besides playing Yuan puts, can we assume a vast devaul being a negative for the Chinese stock market?
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spF***ing Brilliant Interview. My only counter argument is that China now has lots more "wealth" than China in 94. A devaluation this big is exponentially more difficult decision than in 94.
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BVI wonder if the possible yuan devaluation explains why the Chinese have been pushing gold to their domestic population, so as to reduce social uprisings.
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DCVery well constructed argument - I have just googled "The Global Macro Analyst Art of Exporting Disinflation" and found a report that is very relevant to this discussion IMHO
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TLThis video by Mark will again be the best of the year on RVTV.
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MRi think part 2 is needed, what are the second order effects? we need Mark back to unpack his entire post china deval thesis.
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MRMark Hart - smartest guy in the room period. Can we please vote to have him back regularly! His clarity and connecting of dots is hugely impresive.
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CNExcellent job RV bringing Mark back on
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CNI thoroughly enjoy listening to Mark's thought process. I never connected a yuan deval to QE4. Seems to further the long gold and dollar thesis and short anything that's connected to commodities
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WWI've learned more about macro from Mark Hart than anyone in my career. He doesn't do media interviews. Ever. But this is the 3rd time he's been on RVTV. Love it.
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dsUnknown Unknown - China could force HK to peg HK $ to RMB. This could buy China time
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BKOops: make that "per Andrew's comment BELOW."
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BKFantastic interview, great to hear such timely stuff from the "front lines." Per the comment above, I would have LOVED to hear a bit on the knock-on effects ... US Treasuries, for example.
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jeReally beautiful to listen to Mark. He said in last intvw that he was "chasing Flow" (see Book). He has achieved it because he loves what he does probably more than the money he makes if right. A+++
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TVWow! I have never heard of Mark before but I agree with an earlier comment he is def' the smart man in the room concerning the event's and possible effect in China and on the Global Theater. Brilliant
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SSA post on suggested yuan puts and other effect$. Hart to Heart---simple yet brilliant. More Please.
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KDBrilliant. And the fact that market still only looking for 5-10% deval (and most scared to even position for that) shows that absolutely nothing was learned from 2008, or 1998/98, or '94, or.....
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DMBtw My posts are my humble attempts to answer C. They do make it difficult for residents but RMB leaves many ways and but New Elites buy property, & companies simply do trade fx. Hart is great.
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ASGreat interview but in the future when you have the smartest guy in the room available please expand the scope a little bit. Effects of a sharp yuan devaluation on gold? Stocks? Dollar? Oil? etc.
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AAVery good interview but could someone share a broker /platform in UK/US for buying low delta yuan puts pls?
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PRA well signposted interview and boy was it worth waiting for. Mark has a great insight into how the mechanics of China finance work and how they will play out. For me a lesson in global economics.
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DMDevalues also a slap in face to current foreign capital but Harts right - if you go quick&low enough you will see new money come in AND equilibrium and free market global fxtrading then feasible L/T
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HMarks clarity of thought is a pleasure to listen to. His humbleness always particularly strikes me. Low delta yuan puts!
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DMOn cap controls- considering outright trading halts and a command control history, it is possible they will tighten controls but cap controls tend to backfire L/T as it scares away inflows L/T.
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CBExcellent. Wish he had spent some more time on capital controls, who inside China is dumping RMB and why can't these leakages be stopped (like the short sell ban). China giving up FX control is big.
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DMYeay!!