It is a joy to watch Jack's commentary. He's very engaging and entertaining!

We know the trial made a big difference after the European open. I mentioned bank stocks trading at the lowest level on price to book this morning for that reason.

Ed.. well, the point you were making with that banks PB ratio comment was their potential asset impairment issue down the line. I completely agree with Ilto's observation. I have been a fan of the show but today's briefing has missed the mark. Granted that's a small trial, and I'm approaching the vaccine optimism with caution. That said, the dominating narrative that drove risk on today was a valid vaccine "hope" and Powell's pledge to keep businesses out of "insolvency". Both are material enough to challenge our charted 3-phrase roadmap. As such, thoughtful investors should be at least open minded enough to entertain what those surprises could mean to the portfolio. To this bear, today's move was by no means driven by momentum.

Time will tell who missed the mark. A knee jerk reaction to a possible vaccine should not drive the market up about 4%. There is many a slip between the cup and the lip. When a bank is selling its Blackrock position, the algos are looking at the wrong news. The algos will make money with knee jerk reactions. If you follow the algos you may not. DLS

To give some perspective on the vaccine. - Its Phase I or three phases. - Phase II and III usually takes years and 1000's of patient trials. This will be faster but still multiple months. - Phase II is to check dosage, toxicity, safety. - Phase III is to check efficacy - Not in the Donald Trump sort of way. - FDA sign off is months, but expect it to be fast tracked if the above is passed. - Manufacturing volume and distribution will take months to be effective to the mass population. - Vaccines are only partially effective and so a % of the population will still develop serious complications (ARDS). - The virus will mutate, although this one's mutation lifecycle appears to be slower than typical. - Anitbodies wear off in the human body. In summary, if this gets through some fairly significant hurdles, will be many months away from effective enough to allow economies to recover without significant risks. The market has got well ahead of itself and definitely living on hope.

Riki S., that all might be true but what is key here is that based on this initial test the vaccine seems to somewhat work - it may even lead to longer immunities than usual vaccine due to the new technology that it is utilized (subjects had significantly more antibodies than actual infected and recovered people). Even if this vaccine only ends up somewhat working it will be extremely useful to milden the impact on people. As mentioned in the article and by the company, it has lined out a clear path to getting fully approved and being wrapped up by the end of this year. Production and distribution would probably happen then beginning of next year. Apart from all these points, just the mere fact that one of the first vaccine trials leads to these fairly positive results, lets one think the development of a vaccine will not be an impossible task (at all). My personal view was, prior to this, the vaccine may take years and years until it is distributed (record is 4 years) or may never come out (there are numerous diseases that do not have one as we know: SARS, HIV, Malaria, etc). However, these news challenge these views strongly and I am getting open to adjust my portfolio accordingly. I believe it is very important to stay open-minded because as Howard Marks has lined out in his latest memo again we are biased to information that supports our own bias/view and as all value investors, even Ray Dalio, praise to remain open-minded at all times. Be ready to change/adjust views if there is strong evidence for it.

Emotionally the market and culture at large is starved of good news. But to keep this in perspective it was an 8 patient trial.

@Ilto Yes, an open mind is very useful and in particular with respect to finding solutions to a problem that impacts humanity on multiple levels. That said, the vast majority of many initial results of vaccines over many decades have proven to show potential, only to fail in Phase II and III - the burden of proof is high for a reason. The point I was making is specifically one of timing and in particular the added acute pressure to open the economy because of the election cycle, how this dovetails (or not) into vaccine availability based on my initial post points, and risk to the population and subsequent significant risk associated with additional shutdowns, monetary and fiscal support, the human psychological impacts, etc. There's definitely opporunities asset wise to invest in biotech, but you'd better know the risks associated with development timelines, approvals, competition, management, perspectives - every man and his dog in on a float. As Jason D noted, 8 patients is borderline a non event, but the market has apparently been driven significantly higher disproportionately on the news. There are additonal technical reasons, above the fundamental risk/reward equation, suggesting this all has an elevated level of risk, because the rise is based on sentiment and not the real immediate future economy.

True, and it's just a little anxiety inducing for those of us who are in the related trade. @Raoul P, can we get an update on strategy please? Do you advise rolling forward, selling out to preserve capital, or hanging on to this trade until June 26 expiry in hopes of a more favorable trend? Thanks,

Thanks William! You want to really go down a rabbit hole, look at M&A activity of investment banks. One reason why Buffett may be opting for the consumer route - no deals

@Jack surely the lack of M&A activity will change as there is a lot of distress? The M&A activity must currently be on pause because people are looking for direction but one way or the other, the market will require consolidation, asset sales, restructuring - all activity for investment banks?

At some point, the German people have got to wake up and say, enough of this WW2 monkey on our back, we are not going to sell the financial future of the country down the river any longer.

Paul C. - The Euro folks with the money probably do not have enough money to bail out everyone even if they wanted to. Even if they did, the amount of money would continue to expand. Other people’s money is easy to spend. That is why I would like to see some RVTV content on how and the effects of a possible breakup of the Euro. Who currently owns the bonds? How much did they really pay for them? Many Euroland bonds were on bank balance sheets. Where are these bonds now? Are they on the sovereign balance sheets - purchased to save their own banks? Did the sovereigns push all the bonds onto the ECB in case of default? If the ECB defaults, what happens? If the Euro were dissolved would this stop private depositors being forced to bail out insolvent banks? Would it be better to postpone it until the COVID-19 crisis passes by issuing a lot more ECB bonds? What happened by the creation of Euroland is the exporting countries had a lower currency so they could export. Many other countries had their interest rates radically lowered with ECB backing. They borrowed all kinds of money to keep their economies going at low interest rates. A Euroland win/win until the balance is exceeded. No one would have loaned all debtor countries so much money without the ECB behind them. Then it became the ECB who had to buy up all the bonds because no one else would. In a little over 20 years, this political idea may have run its course. In the meantime, the exporting engines of the Euro are in recession and the borrowing economies are in desperate need for much more COVID-19 borrowing. There is nothing brilliant here. At some point common sense will have to come into play like any bankruptcy - liabilities vastly in excess of assets. China at least is a sovereign and can print money. The US is a sovereign and is printing money like the Sorcerer’s Apprentice. Euroland does not have a sovereign. Do bureaucrats make a sovereign? DLS

Done! Hugh Hendry has interviewed him. It's coming soon. Watch for it.

Novogratz was at times very coy and disingenous about about the way he framed up his arguments and dressed up many of them with obvious mainstream leftist political undertones. For example, he casually mentioned how polarized the country is and implied that Trump has caused this. When one would have to be deaf, dumb and blind not to notice how the leftist mainstream media, led by CNN & MSNBC, and supported by NBC, ABC, CBS, NY Times, Wash Post etc. all have been so vehemently anti-Trump that that quite literally support the opposite side of whatever he says or does just to create opposition and drama. Or just to support the Democratic position at the time. There were countless other examples of this during the interview. I enjoyed the interview, but at times it got a bit too political. If Novo's political views were something new and refreshing and a counter-narrative to the mainstream media messages we get 24/7 it might be more enlightening, but we can hear those tired old themes all day long. I tune in to RV for differning opinions. In any case, Novo is gonna be Novo so Raoul did a good job of moderating and staying on track.

To clarify, Sweden is part of the EU but do not use the Euro as their currency.

it reminds me of 2016 where most people were stridently dec;laring hillary the winner. for biden to win he has to appear competant and not senile. im in the uk and i dont see biden as those things. if biden does a terrible gaffe on live tv shortly before the election shurely he will lose? who knows? best wishes to everyone

spot on! and Hillary was a far more viable candidate than Biden

What appears incontestable is that it will be one of two incompetents.

The important point here is Mr. Buffett did not like the airline business. He probably relented and bought against his own convictions. Then when the airline stocks fell, he bailed. This hopefully will help a lot of other investors. DLS

Thanks, Charles. It's a great quote.

Charles N. I- Great story and loved the quote. I will borrow it often. DLS

Thanks Sebastian!

All good! :)

Hi Darren, thanks. I really am very lucky. It truly is the apprenticeship of a lifetime!!

In a world out of wack, wacky behaviour makes sense, I suppose.