It is always beyond me when people press the dislike button, I can understand if somebody disagrees with the views but to dislike is either ignorance or the competitors...

Real Vision should interview Aswath Damodaran who teaches corporate finance and valuation at the Stern School of Business at New York University. His viral market update: making sense of the market, valuation of S&P 500 on Youtube is not only enlightening but also so well supported by his research. He is the only expert I have heard that can logically explains the disconnect between current lofty market valuation and the real world financial crisis. Check out his latest Youtube segement: https://www.youtube.com/watch?v=3cARjvs9fns

I wish Real Vision would've told us to buy this counter trend move. That was a big miss.

Ahh 'panoply' - great word! Such a smooth talker.

ok Raoul, you are misunderstanding Bitcoin as a productivity storage for electricity. This is not correct. I've been on Bitcoin since 2013 and was a Genesis founder of Ethereum. Bitcoin works under something called POW system. Proof of work system. This was the only known method at the time to guarantee Byzantine Fault Tolerance. Essentially, ensuring that your transactions are valid. However, this is mostly due to code inefficiency and due to simply having lack of better coding infrastructure. I repeat, Bitcoin does not need this huge electricity to mine and secure blocks. This is the ultimate flaw of bitcoin as it stands and I hope they get rid of this in Time. The world of blockchain is moving into something called proof of stake where you and I can stake the Bitcoins we have to allow someone else to make the transfer. Then we get paid tiny fees of that transaction. That's our perpetual yield potential. It's great! This method allows for lightening fast transaction speed while also ensuring Byzantine fault tolerance. So the wasted electricity of POW system cannot be called productivity. It is code inefficiency. The most promising blockchains have been working super hard in the last 3 years to transition into proof of stake system. Ethereum 2.0 is all about that. EOS, Cardano and Hashgraph use next generation systems to ensure transactions are safe and hack proof. You need to get this right about crypto if you are going to recommend to your viewers. I've been in this space for longer than I should and sometimes when I'm listening to you talk about crypto and making recommendation, I wish you looked into this more and really really understood it. Give it a try! Start from why the Fu** is mining needed? How are people currently thinking outside the box to solve this problem that wastes tremendous amount of Energy. What is Ethereum, EOS, Cardano and Hashgraph, Tron etc doing to fix this. What does Ethereum does that Bitcoin doesn't. This space needs to be understood and not speculated on.

Where else is the money supposed to go but equities? We've passive indexed everything, treasury yield is non existent, pensions have to find yield somewhere, debt is exploding and the FED is printing at a rate. Won't fuel the gold vs btc discussion except to say that neither seems logical. Where will it all end up? I'd venture that the U.S. is going to kick this can so far down the road your head will spin. Personal debt jubilee, infrastructure spending program that will make the stimulus look like a trip to McDonald's with a side order of inflation.

“Chick a fil” - loved that moment and broader point

bit concerned that riots and protests are spreading as fast as CV and yet nothing is mentioned about the political situation and its potential affects on markets

Great video. Raoul is always a great read on what is going on. Regarding the protests and riots, I think the point needs to be made that many of these riots have turned violent or have a manacing social justice spirt about them and that BLM have resorted to violence in the past and used almost any situation to escalate. They are not the 'good guys' here and are seeding chaos and division within society, fully supported by most of the mainstream media. African-American journalist Larry Elder does a vwry good job of offering up counterpoints to mainstream media narratives right now in this video which I think is very insightful: https://www.facebook.com/12503116997/posts/10157916222571998/?vh=e

I did not see the dog in the vidio...

I really like the improved camera and lighting quality, but the angle is a bit odd...

A note regarding the restaurants in Europe, I am living in Germany and was this week for one night in the Netherlands. The bars and the restaurants in both countries are packed, no social distancing(rules are there) and the vibe is as if nothing happened. On the other hand at the hotel we stayed we spoke with one of the employees and she said that normally at this time of the year the hotel is full but not now. Anyway the borders were opened this week for the first time.

I’m concerned that RV Essential package is now just the Daily Briefing. In the past there was a much wider selection of viewing choices. I don’t know... maybe it’s just me ??

I found this conversation very disappointing. Maybe I had too high expectations. I was expecting that in the first appearance of RV thought leader after the three week “Recession: What’s next?”, Raoul would wrap that up with his learnings from the three weeks. Updating or fine tuning his framework and his thoughts after these three weeks. It seems he resigned from defending his framework or further reasoning about it to help the RV audience better understand was it is going on. Instead we got an unprepared chat over coffee with obvious points (e.g., there is a lot of uncertainty, secular shift towards digital…), points not supported with facts/figures (e.g., liquidity is going to be sucked out the marked by new issuance, Germany restaurants are down). Most things have not gone so far in the direction Raoul pointed towards (commodity prices up, dollar down, bond market indicating the avoidance of deflation and towards a low inflation environment…) but we need to understand his framework as a long term play. All the recent moves can obviously change and go in the direction Raul says. What could be alternative scenarios? why stimulus has to stop soon? They could be extended for long? A Fed b/s of 50 Tn in a few years? (as long as rates are 0 that would be possible, no?). It would be great have Raoul to talk about all these!

We need an electronic form of toilet paper......Fast...

Can you comment on Bitcoin next week?

This narrative that its over for industrials is infuriating. Its like in 20 years we’ll all be living in little huts in the forest like the Unabomber. It makes no sense. I happen to think people will consume more goods that, correct me if I am wrong, will have to be made in an industrial capacity. GE itself may be cooked, but who is going to produce all the crap amazon sells? Someone help me. Most likely it wont be china, but it wont be industrials either? Is everything gonna be 3D printed? But even that is industry... alchemy?

A few points of observations and just sharing my thought process thus far, would be happy to hear what others think: I find the narrative of the Robinhood traders as a major catalyst for the rally for the past few months a pretty lazy one that most media outlets have latched on to. Firstly if you look at all major equity indices through the world from a cursory glance ie eurostox, FTSE, MXJP, EEM and even the vanguard world index all the short term momentum indicators turned positive approximately early April and the positive trend has accelerated much faster the past week just as USD is weakening. Is this correlation or causation? Not sure that’s above my pay grade but that just caught my eye. Even within the US itself the sectors that have been the laggards ie financials and industrials have started breaking higher out of their resistance levels (and bear in mind these were the sectors that most fundamental bears had anchored on as the weakest links of the chain). Now if it this was just a US only/ rotation between sectors within the S&P I can buy the argument this is mostly due to the Robinhood traders but the fact that most major equity indices are breaking higher in a strong uptrend/the laggard sectors finally starting to break out above prior resistances suggests to me something larger is in play here (unless someone asserts that Robinhood traders have the ability to push every single equity index all over the world higher/each country has their own form of Robinhood platform where people are buying their own country’s equity products with their own country’s stimulus pay checks !) In my mind the most likely explanation I can think of is just pure liquidity provided by all central banks/the re-levering of equity portfolios from non fundamental players re establishing their equity exposures after the big washout in mid Mar. Is this hindsight? For sure there is an element to that. But just simplistically looking at the chart and trend, one won’t want to fight against this/be short and from what little CTA models I follow most are still net short say 10-20% in equity indices just as the VIX has been gradually falling which suggests that there is still plenty of buying from these fellows given the trend, positioning and falling of vol. From my limited understanding as vol comes off risk parity funds lever up too and given they had just puked out in mid Mar would imagine they’re far from max long equities. (Just to cite non “fundamental” buying which comes to mind am sure there are plenty more systems out there). The thing that now puzzles me is thinking about the Active equity crowd mentality, especially on the long-only front. Judging from the bearish narrative throughout this rally and also from a few anecdotal conversations with equity professionals in which some of their PMs increased their cash positions in late Apr (prudently in my mind given the uncertainty then and now), i would imagine quite a few folks are now less long vs their benchmark and since then markets have rallied much harder causing in underperformance relative to the benchmark. What do these folks do now? What would their clients do? Granted it’s only been 2 months but given most of these folks performed as badly as say the S&P on the way down but underperform on the way up ex fee-drag (so far), how do the behavioural dynamics play out there? Is it even a big deal given these guys are long only so even though they’re less long vs the benchmark they got to participate in the rally the past few months? Don’t get me wrong am reading the same fundamental news flow/narratives and listening to the great content realvision/other macro and fundamental podcasts are putting out and am sure as hell worried/uncomfortable about the disconnect between the real world and securities prices. Having said that, it does smell like the general trend still seems to be up in the short term and while all the great points brought up are valid ie possibility of a second wave, economy just not getting back to full capacity and subsequent data disappointing the question always in my mind is yes sure but from what base? Having voiced my thoughts out now am sure the market gods are going to punish me by causing a major sell off of 50% right next Monday :) But curious to hear what others have to say. Cheers and keep up the good work

Raoul oscillating on Little Cayman again. He goes from beach side paradise to stuck on a bloody little island lol.

I think it's a bad idea to work off the assumption that stimulus can't be permanent. It's akin to real estate prices that can't fall nationally and rates that can't go negative. It's very easy to create a map that leads to UBI and MMT. With UBI, government controls employment (prices and rates). With MMT, government controls capital. One might argue the Fed can't create capital, and right now that's true, but I can easily see the day when some politician observes the debt on the treasury balance sheet and the corresponding bonds on the Feds balance sheet and says, what if we just strike a line thru that? They'll argue, no one gets hurt, capital was just created, and we go from the heart of a deflationary spiral into an inflationary utopia. Wait for it...

Just a suggestion from one subscriber please do not overdo it with “coronavirus experts’ as the credibility of the “experts” has to be called into question as the economy was locked down/ ground to a halt and it now looks like either the result of incompetence or some other unknown agenda. I am not minimizing the tragedies of coronavirus, but the “experts” have frightened the hell out of the people and the economic ramifications from the likely behavioral changes will be known in due time.

There was much celebration of BLS 2.5 mill jobs (establishment survey). And not much questioning over why there was such a large difference with loss of 2.7 mill jobs in ADP report a few days before. Or that the new unemployment claims of 1.8 mill. And that the BLS report also showed losses in government 585k. The reconciliation is in the BLS report footnote. Jobs include persons paid but not actually at their jobs. In pre-covid times, this class of persons was probably small (vacations). But in May this class included persons being paid by employers from the PPP. Raoul mentioned this a couple of times but it was otherwise celebrated as a turnaround. It’s not. The 2.5 million is the result of the government handout!

Are u guys sure that "the stimulus is temporary"? I am not so sure.

Petrodollar..........Definition The origins of the petrodollar system go back to the Bretton Woods Agreement, which replaced the gold standard with the U.S. dollar as the reserve currency. ... That led to the creation of the petrodollar system, where the U.S. and Saudi Arabia agreed to set oil prices in U.S. dollars.. Investopedia.....The Saudi's agreed to this system in exchange for military protection by the USA. The Americans laid out their terms. They were simple, and two-fold. 1. The Saudis must agree to price all of their oil sales in U.S. dollars only. (In other words, the Saudis were to refuse all other currencies, except the U.S. dollar, as payment for their oil exports.) 2. The Saudis would be open to investing their surplus oil proceeds in U.S. debt securities.

EU one and done? When has any central bank been one and done?

It seems to me that the driving forces behind the market rebound are assuming that either Covid is now going away or, based on all the publicity about Covid vaccines and drugs in development, we will be able to return to normal within, say, a year. If and when the market believes that a second waive is coming, it will take a lot of wind out of the market sails. Now suppose an effective treatment (one that is proven to be effect via double blind placebo controlled studies) is found? Well then a lot more reluctance to invest in stocks will fade away. In fact, that latter possibility has a pretty good likelihood of becoming a reality by the middle of July. There is a drug currently subject to two placebo controlled double blind studies in the U.S., one study for mild to moderate symptomatic patients and one for severe to critical patients, that is due to be unblinded June 15 and the results analyzed by July 15. The reason it appears to have a good likelihood of success is that it has shown dramatic results in more than 70 emergency IND patients, some of which had mild to moderate symptoms, and has already successfully completed an FDA Phase 3 trial or HIV and is the subject of a filed FDA BLA application. If approved, Covid victims will be eligible for treatment as soon as Covid is diagnosed and it is merely a subcutaneous shot given twice in two weeks. This would lift the specter of death from risk of Covid infection and make it feel more like a bacterial infection for which there are effective treatments. What do you think the market will do if this comes to pass? An acceleration point?

yes, the poo (aud) did flirt with 7 for about 30sec. I shorted it few days ago and capitulated fast as I realised I will get squashed. But after China telling its citizens not to travel to Australia I am thinking of shorting it again and monitor this development.

I wish you used subtitles on all of these.

Seems like economic numbers are going to be all over the place for the next few months. We may not have a good sense of things until the 4th quarter.

There's a lot of new people betting in the market who don't really know what's going on and how markets work. If they keep on beeing right it would be the first time that newbies don't an expensive shaving.

No real corona experts please! what is the point??

What camera do you use? I need a new one

Just to balance things a bit, here is an update from Prof. Damodaran, who I consider to be a very sane, respected yet balanced voice in valuations. The mean of his CF projection based valuation of the S&P is about 5% below the current market level, which is not a lot - considering how quickly things change and seems to line up with the current options distribution relatively well. http://aswathdamodaran.blogspot.com/2020/06/a-viral-market-update-ix-do-it-yourself.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+blogspot%2FpHUuM+%28Musings+on+Markets%29 RV editors: Would it be possible to introduce him to the RealVision crowd? Recently there has been some requests here to start adding more execution ideas and implementation details. Of course that will be a struggle with commercial portfolio managers (not just the trade ideas but exposing process details) but it's not an issue with him - freely sharing both process and data in a fairly up to date fashion. Not stuck in the library, practicing what he's preaching, has foundations both in macro and corporate finance. Thank you!

I was gonna watch this interview, but I couldn't see the white cueball on the pool table so I bailed. 🤣

Feel like they are maybe being a bit sanguine about the nature of these protests. Good analog I heard it’s all snow piling up on a mountain, don’t know which snowflake causes the avalanche. Very tense time to be in America, people outside might not really realize that.

Drunk the cool aid !! love it ...

There are some serious questions around the unemployment numbers that came out today. From WaPo: "The special note said that if this “misclassification error” had not occurred, the “overall unemployment rate would have been about 3 percentage points higher than reported,” meaning the unemployment rate would be about 16.3 percent for May." https://www.washingtonpost.com/business/2020/06/05/may-2020-jobs-report-misclassification-error/?utm_campaign=wp_main&utm_medium=social&utm_source=twitter#comments-wrapper

In Miami; for the most part businesses are opened. Momentum is slowly starting to pick up.

The irony of Raoul's new improved video camera is the picture on my computer is grainier than ever due to my internet speed. And I can't see the cue ball on the pool table!!! Side note: very warm and insightful interview here, totally agree we don't want to live in a world of successful mega-restaurant chains and bankrupt mom&pop watering holes where the interesting conversations take place. We really need to focus on decentralization of things. Think the never-ending variety of food stalls and t-shirt shops other-street shops in Bangkok Thailand.

This was one of the best - past, present, future - geography, all in one. Very well done.

And if the EU and US decide to play the Japan game, and buy and bail out everything and everyone always? Would it be possible?

I just want to get some clarification on what Raoul is talking about when he says Hi Frequency data. High-Frequency Indicators of Economic Activity (IEA) Flash estimates or indexes of economic activity bring together a range of elementary indicators to give timely general measures of economic activity. He specifically talks about the data from HF China and is there somewhere that we could also access that as well. I know Raoul appreciates sharing his resources as well as our friend fro #oott Mr. Sam does as well.

Shenanigans is a great word for the numbers today, how did the dentistry sector add jobs when the industry is only open for emergency services only. BLS data is using birth/death rate to average employment numbers. Needless to say market went up all is well nothing to see here. To all at Realvision have a great weekend.

Hey Raoul, What watch are you wearing on your wrist right now?

“The world has changed. The world has changed hugely.” Now the equities market must join the revolution. Lovely weekend gents. Cheers.

Raoul you went from the stone age to just short of a 3d hologram 😂 Great talk. Love the focus on forced productivity gains/digitization. So true Commercial realestate is toast

Raul's blurry background is annoying. The old camera was alright. reducing picture quality to increase transition speed would be ok us, I guess. Can't see dogs :)

Prefer the other camera...looks a bit like green screen. Great discussion tho.

Meh, I kinda liked the grainy Raoul Pal better ;D

How do we square the BLS info ?

With the 10y going up fast could we see inflation everyone was talking about?

New set up would be even better if Raoul looked at the camera