Comments
Transcript
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CGIt is understandable that Texas has few snow plows. The collapse of the energy market, however, was completely predictable because of a poor regulatory environment and pricing everything on the cheap. From Ed Hirs, an economics professor at the University of Houston: "The operation of the electrical grid was consigned to the Electric Reliability Council of Texas. It is a nonprofit consortium that operates the grid for about 85 percent of Texas. Understand, ERCOT has no ability to invest in generation or infrastructure. It acts only as the air traffic controller for electrons on the network. ERCOT is accountable to no one, but it reaps hundreds of millions in fees. Because it is contained within Texas, ERCOT is not subject to federal oversight. ERCOT created a system whereby generators, companies that own power plants, compete by bidding to provide electricity for the “day ahead” and in real time during the day. It is called an “electricity only” market. Think of it this way: If the players on the Washington Nationals were paid in the same fashion, only those players on the field for the game that day would earn a paycheck. Everyone else on the roster would be unpaid. Players would offer bids to play for the next day, each undercutting the other." This led of course to low infrastructure investment and to not using union labor." www.washingtonpost.com/opinions/2021/02/18/texans-grid-outage-deregulation/ The system supplying natural gas also had problems with freezing and delivery. Again, poor regulation and the desire to save money.
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KCYield curve control after WW2 worked because the deficits dropped when the war was over. Who will move us down to 1% deficits now???
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CSHmmm! Passive is swamping out true value investing. If there's a sell off every stock in an index goes down whether good stock or not. Well,, search out small companies that are not in any index or ETF sounds like a lower risk tactic given timing the market is tough and you want to reduce risk.
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CPCan we please get Preston Pysh on RV at some stage?
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zhlumber price increase is bc of fed's action? huh? FOS as usual
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MBthis guy is an ex-execution trader. why do we care about his opinion? He is either stating obvious or piecing together things he read on bloomberg.
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OCMan, this is wild stuff right here. I want to see Tyler talk to Mike Green on his macro-crypto merge. Mike Green talks about crypto being a form of "opt out" but also recognizes the reality that the average individual has been rendered so powerless. Having identified the two issues that he focuses most on (passive flows and China) and seeing Tyler talked about these two from the perspective of who we are as Americans and the end of free markets, I'm sure that will quite the conversation (yes, people, I am also aware of the generational difference between Mike and Tyler but I think that these issues go beyond that). This was good. Thanks.
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MLThis was really fantastic.
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GHWho watched the Hugh Henry / Raoul Bitcoin debate on Twitter? I think Huge completely exposed Raoul’s irrationality regarding Bitcoin. Further, I question someone who has put “60% of his portfolio” into Bitcoin. I love Raoul, but this is nuts. I’ve always heard that the #1 rule of investing is to not fall in love with a single investment. Clearly Raoul has and it makes me question his rationality and how much I should listen to him.
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TTThank you guys, awesome DB. 👏
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KTExcellent interview! Feels like Tyler is upping hs game. Nice work
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AAI heard the same Preston Pysh comment and had the same lightning bolt strike on the brain. Crypto yield is expressing volatility leaking out of traditional market (where it is suppressed at all costs).
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NE‘Pay up Mortimer, I’ve won the bet.’ Props to Ed for the Trading Places reference;)
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EKThis is great and I personally don't see many talks like this elsewhere.
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MKI live in Japan and 70-80% of the equity market is owned by the J-government. They cannot stop buying as the entire pension system will collapse. They have to keep buying and even forcefully increase the pension contributions from the working population just to keep with the pace of people retiring and meeting their pension liabilities. I have a feeling similar thing will happen in the U.S.... maybe in 5, maybe in 10 years but there are just so many unfunded liabilities.
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JKPlease let us know how we can subscribe to Tyler’s newsletter. Thanks.
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JHLoved this interview - particularly the point around the passive bubble. Here in Australia, our government is mandating an increase to forced retirement savings (called superannuation) from 9% of annual salary to 12% over the coming years. As much as I suspected equities were bubbly, I now think that a clear trade here for the coming 15 - 20 years is going to be buying the index and front running the growing demand from passive flows. I'm struggling to see how this doesn't work when the net inflows will far outweigh the net outflows. Anyone have a different perspective on this or what I might not be seeing? What could force this passive bubble to pop - particularly here in Aus? Cheers, James
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INOne of the most important RVDBs ever. The right questions are asked by the no-water man.
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JAI usually am in disagreement with Tyler because our time horizons don't match up, but he was spot on today. Between agreeing with him and Tony Greer more and more, that makes me think we are at an inflection point. Don't know if that is good or bad for markets, but I don't think the next couple of months are going to be boring.
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JFReally nice to see Tyler back. Great session Ed & Tyler!
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BDI had a hard time following this guy he went from boomers to the dollar, to blow off top, to retail, to Weimer republic, k shape recovery, to crypto, with no explanation of any of them.
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CMFantastic. And interesting. Thank you.
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GSGreat update. Thanks, guys.