Daily Briefing – April 16, 2020

Published on
April 16th, 2020
Duration
28 minutes


Daily Briefing – April 16, 2020

Daily Briefing ·
Featuring Nick Correa, Ed Harrison, and Roger Hirst

Published on: April 16th, 2020 • Duration: 28 minutes

On today's Real Vision Daily Briefing, Roger Hirst and Ed Harrison discuss FX markets, high yield credit, and EM fixed-income through the lens of Brent Johnson's "dollar milkshake theory" and Mike Green's thoughts on the concentration of capital. Harrison and Hirst analyze the impact that the Fed's yield curve control will have on net interest margins for banks and whether central banks will draw a "line in the sand."

Comments

Transcript

  • JS
    Julia S.
    19 April 2020 @ 18:27
    When European banks get nationalized, what happens to their equityholders? Are they bought out at a premium? Is there a play here for us retail investors? If yes, what would the news triggers be? Thanks - great update as usual. And truly love the new format with more news, directly related to RV dominant theses triggers.
  • JB
    James B.
    18 April 2020 @ 05:45
    Great video as always guys. Kind of sad that with all your knowledge and experience it all just boils down to follow the fed central planning.
  • MS
    Matthew S.
    16 April 2020 @ 23:56
    The R. Hurst vino indicator still bullish
    • JB
      James B.
      18 April 2020 @ 05:43
      Need to start charting it and get some TA on this proprietary high confidence indicator
  • DM
    Dominic M.
    17 April 2020 @ 23:19
    Really excellent conversation.
  • ar
    andrew r.
    17 April 2020 @ 16:09
    Great explanation of the dollar vis-à-vis EM FX, Roger. Thank you.
  • wj
    wiktor j.
    17 April 2020 @ 13:33
    I would like to hear from Brent Johnson as a followup. Europe will never unite. Too much history. Its like saying Russia unite with USA. Will never happen. They might trade together have a trade agreement but never unite. A "I am sorry Italy" from Brussels wont hack it. Too many people starving in Italy and too many people have died.
  • JF
    Jack F. | Real Vision
    16 April 2020 @ 23:09
    Hi all, You may have noticed some differences in the first part of today's video (the part BEFORE Ed and Roger, from the start of the video to 2:30). We focused more on markets and less on the coronavirus case data. We also tried to provide stories that you may not have heard about (such as Neiman Marcus missing coupon payments) rather than stories you almost certainly have heard about. We're changing and evolving the segment to meet your needs. We would love some feedback on how you feel about these changes, and the opening segment in general. Specifically, could you give your thoughts on these questions: How do you like these changes? How do you feel about the opening segment in general? How could we improve the opening segment? Thanks, Jack
    • TS
      Tamim S.
      17 April 2020 @ 00:00
      It would be nice to get more Bitcoin/Crypto coverings in the Daily Brief.
    • NS
      Nisala S.
      17 April 2020 @ 00:08
      Today’s daily was very insightful- the linking of daily events to macro, to therefore indicators to follow, in a highly uncertain period hit the spot for me. Thanks for your critical thinking!
    • RA
      Robert A.
      17 April 2020 @ 00:19
      Yes, noticed the slight change and liked it, especially the Credit little known facts....kind of reminds me of reading Jim Grant’s work every afternoon where I get fantastic snippets of important head scratching Credit happenings that I don’t see in FT, WJ, CNBC or haven’t made it into the Economist just yet (probably because those companies don’t want me to near about their “doings”). So....any CHANGES to the Covid curves, therapeutics or Vaccine progress= “yes please”, but save some room for the stuff on Ed, Roger and Ash’s radar screens! One last thing—please see my comment on yesterday’s Daily Briefing re viewing the fantastic RV video by Brent and Luke on the US $ debate. That video really helped me follow the great discussion you guys had on the US $ today!
    • ZT
      Zach T.
      17 April 2020 @ 00:52
      The changes are better, it's nice to have a market overview as well as the stories in the opening segment.
    • DR
      Derrick R.
      17 April 2020 @ 02:39
      Jack, love the change. Thanks.
    • RS
      Roger S.
      17 April 2020 @ 03:17
      great the most important thing is the markets. I can get the numbers everywhere else
    • JD
      James D.
      17 April 2020 @ 05:08
      Market data is great. RV has talented people; keep letting them be creative and explore their ideas. Keep finding nuggets!
    • RD
      Riki D.
      17 April 2020 @ 05:21
      Hi Jack... it would be great to link some of the risk issues back with crypto and gold so we stay aligned to Raulo's thesis which hinges on the further emergence of both assets... not trading advice, just scenarios. Cheers
    • MT
      Mark T.
      17 April 2020 @ 13:20
      Thanks Jack, I like the new format and little nuggets like Nieman Marcus.
  • PJ
    Peter J.
    17 April 2020 @ 12:43
    Ed, Roger keep it going, great updates
  • TC
    Trevor C.
    17 April 2020 @ 12:07
    Roger enjoying the grapes, got to love it.
  • PM
    Philip M.
    17 April 2020 @ 10:42
    Love you guys...
  • TW
    Thomas W.
    17 April 2020 @ 09:26
    Regarding Brent Johnson's Milkshake Theory; he is always at pains to mention that it's not a straight line. We had a sharp move down as people factored in a lot of negativity and no amount of good news could stop it. Now we are seeing the same in the other direction. When there is as much uncertainty, as there is right now, people become overwhelmed and instinctively follow the market. That is, until the point where the only thing that is certain is that the market is in the wrong place. Then we see a change in direction. We seem to be at that point about now. The one constant throughout every crisis in history is people; we never change. I think that is why these retracements recur each time. I suspect we will see big moves between The Dollar and Gold as (on balance) they both move upward. And, US Equities will be knocked one way or the other as that happens.
    • TW
      Thomas W.
      17 April 2020 @ 09:42
      It would be great to get Brent Johnson and Luke Gromen back on Real Vision.
  • RG
    Richard G.
    17 April 2020 @ 09:30
    Excellent content gents - keep it up!!
  • JM
    Jake M.
    17 April 2020 @ 06:54
    can any one elaborate on the concentration thesis underlying Amazon's gain? I think Roger alludes to Mike Green but Mike has several videos on RV, not sure which one in particular is about concentration of capital.
    • RH
      Roger H. | Real Vision
      17 April 2020 @ 07:00
      Hi Jake - Raoul interviewed Mike on April 8th as part of the Real Vision Live series, titled "The Recovery: Shape Matters" https://www.realvision.com/shows/live/videos/the-recovery-shape-matters-live-with-raoul-pal-mike-green?source_collection=a25c9755a2b24b2181af5ad0a10f6636
    • RP
      Richard P.
      17 April 2020 @ 09:24
      Ok great thanks. Just a request, I pay for a pro membership and not all these videos seem to be loaded up on the app??
  • AH
    Attila H.
    17 April 2020 @ 06:59
    Great content, superb quality too! Guys, regarding Ed's note on FED's yield curve control, what probability do you guys see for sub-zero FED rate ?
    • RH
      Roger H. | Real Vision
      17 April 2020 @ 08:43
      Hi Attila - I think the Fed will be reticent to go below zero, considering the damage this policy has caused to European banks. I expect they will keep the front end anchored around zero, with the heavy lifting being done by the back end (e.g. 10-Year) which can head toward zero and below (i.e. flattening and possibly inverting the curve, which will also be bad for banks, but the lesser of two evils). This is my own view - others at RV have a different take. Roger
  • CT
    Chris T.
    17 April 2020 @ 05:56
    Interesting thing to note RE: 401k contributions in the US as a source of support. I run the FP&A group of an SMB company and one of our initial cost mitigation moves was to pull the match. Additionally, I believe regulatory change has removed the penalty for early withdrawal. Will be interesting to see if this support remains, or if there is some sort of behavioral change that decreases fund flows (or outright outflows).
    • PC
      Paul C.
      17 April 2020 @ 07:28
      Those fund flows into equities have to slow as people start to review their portfolios and media focus moves from Covid and to more on the economy at large. In last few weeks i've sold perhaps 30-35% of my equity holdings into the rally and moved my fresh corp pension contributions to cash/cash-like investments. Happy to sit on the sidelines and watch now. will sell more if the rally moves higher, or it feels like we're going to roll-over again.
  • HV
    Henrik V.
    17 April 2020 @ 06:29
    Very enlightening episode so many variables to consider🧐
  • IH
    Iain H.
    17 April 2020 @ 05:33
    Always enjoy the updates with Roger and Ed. Thanks guys.
  • Am
    Alex m.
    17 April 2020 @ 05:24
    Great show lads, I really liked that one!
  • RD
    Riki D.
    17 April 2020 @ 01:27
    Awesome as usual guys. What are your thoughts specific to market recovery, regarding the after market story that Gilead Sciences have found a solution (remdesivir) where patients respond positively to treatment? More specifically, how this might impact gold. ------------------------------------- Gilead surges after report suggests COVID-19 patients responding to remdesivir https://www.nasdaq.com/articles/gilead-surges-after-report-suggests-covid-19-patients-responding-to-remdesivir-2020-04-16
    • RD
      Riki D.
      17 April 2020 @ 05:17
      Cull that thought.... potentially an issue with a hedge fund spinning rumours to exit a position. https://www.zerohedge.com/health/gilead-pours-cold-water-report-sent-market-soaring-anecdotal-reports-no-statistical-power
  • DM
    David M.
    17 April 2020 @ 03:57
    Wonderful back & forth. I agree that Fed's actions are amplified by international investors wanting to buy 'that which is supported'
  • NR
    Nelson R.
    17 April 2020 @ 03:05
    This duo is fantastic, enjoy the chemistry and the the insights. Well done lads.
  • SN
    Shmuel N.
    16 April 2020 @ 23:57
    funny that we discussing Bear market while the market keep rally up up up to all-time high. What is the opposite perspective that explain this run? I mean not everyone buying the bubble... I am sure that there is some rationale around that rally
    • ag
      alan g.
      17 April 2020 @ 02:56
      Futures are looking healthy for 2mo, at this rate markets will be hitting new highs soon.
  • DR
    Derrick R.
    17 April 2020 @ 02:43
    Another great daily update.. the end made me chuckle too. Thanks for keeping us updated and in good spirits guys.
  • SM
    S M.
    17 April 2020 @ 02:25
    Which EM currency Roger is looking into it, particularly?
  • LS
    Lemony S.
    17 April 2020 @ 02:14
    Yes, thankfully less and less about the covid19 hype, if you want to really see how overblown it is, check out Michael Burry's twitter (if you're too lazy it's just like the flu, except with higher R0 but only in certain environments like NY, obviously). So other than that, yes, keep going gents!
  • JP
    Jordan P.
    17 April 2020 @ 01:31
    I want to hear about gold. There’s no coverage or commentary on it.
  • TS
    Tom S.
    17 April 2020 @ 01:24
    Great intro and interview. Last month Canada's Marin Katsua pointed out unprecedented dollar and US strength inherent in new bailouts and SWAP lines. The huge majority of the world's debt is USD denominated, and since Basil III and post 2008 US regs, the USD is not fungible across domains except for those in which the US has deemed to open a SWAP facility (under US terms). That's power.
  • JL
    Justin L.
    16 April 2020 @ 22:44
    I'm starting to get FOMO
    • ns
      niall s.
      16 April 2020 @ 23:47
      Don't' you dare , RV is here to protect you from those nasty 600 S&P point bear market rallies
    • Rg
      Ruben g.
      17 April 2020 @ 01:21
      Don't cave! trust the logic of these great teachers
  • GA
    Greg A.
    17 April 2020 @ 01:09
    Great segment. Yes I've had enough of the C-19 updates....if people still care they can certainly learn of those numbers elsewhere. The little known facts are gems...keep them coming
  • AG
    Alexandre G.
    17 April 2020 @ 00:47
    Should the role / power of central banks not be strenghtened during the crisis period ?
  • NR
    Nathan R.
    17 April 2020 @ 00:14
    At this point, all markets are simply levered gambling for a dwindling number of people. Perhaps industrial commodities or ED are less gamed, but really market capitalism has given way to neo-fascist MMT in pretty much each country.
  • DL
    David L.
    16 April 2020 @ 23:56
    Liked the opening segment market data and de-emphasis of corona virus info. Wouldn't mind a little more market data, bearing in mind that the discussions with Ed and Roger, etc. are the high point. The briefing is now daily due to the unprecedented current conditions, but I wonder if this could become a regular weekly or semi-weekly feature once things calm down.
  • AR
    Alex R.
    16 April 2020 @ 23:44
    Just want to say thanks - these daily segments have been brilliant. Today's has been the best so far (and the competition has been strong!).
  • TC
    Thomas C.
    16 April 2020 @ 23:05
    Good conversation, abet short term 3m perspective (ie) mkt supported by CB's. What's after that is the question
  • MT
    Mark T.
    16 April 2020 @ 22:53
    Great segment as usual. I am just at stunned that anyone would pay $105 for $1 of Amazon earnings... earnings that are very inconsistent at best.
  • PB
    Paul B.
    16 April 2020 @ 22:44
    I see Vol getting into the FX next...I'm with the Camp of Insolvency dragging everything down. The Debt to GDP will be horrifying..The GDP going one way and staying down and debt going the other way. Something has to break
  • RT
    Rob T.
    16 April 2020 @ 22:42
    Good market commentary. Interesting take on the USD strength on Fed pump and the fund out flow threat for current equity winners.
  • RN
    Richard N.
    16 April 2020 @ 22:29
    Keep enjoying those beverages, Roger and Ed!! I'll be doing the same on my end.
  • TS
    Tamim S.
    16 April 2020 @ 22:12
    S&P 500 futures are looking good right now.