Tony Greer: “Commodity Inflation Is Happening Before Our Eyes”

Published on
February 16th, 2021
Duration
38 minutes

Bumble’s IPO, The Yield Curve Migration, and a “Bubble” in Passive Investing?


Tony Greer: “Commodity Inflation Is Happening Before Our Eyes”

Daily Briefing ·
Featuring Tony Greer and Ash Bennington

Published on: February 16th, 2021 • Duration: 38 minutes

Real Vision senior editor Ash Bennington welcomes Tony Greer of TG Macro back to the Daily Briefing to provide analysis on the billowy price action in commodities. Greer looks at the market dynamics behind the rolling blackouts in Texas and discusses the oil curve steepening further into backwardation, allowing speculators to generate greater roll yield. Looking at similar phenomena in aluminum and copper, as well as the new relative highs in the VanEck Oil Services ETF ($OIH) and the Energy Select Sector SPDR Fund ($XLE), Greer surmises that we could be seeing the dawn of a new bull market in commodities, which may lead to a commodity supercycle. Bennington asks Greer about his latest longs, which include Freeport-McMoran ($FCX) and several homebuilding stocks. Greer explains why he thinks put options offer a low risk/reward even with the VIX barely above 20. In sum, Greer thinks the liquidity faucets from the Federal Reserve will continue to buoy all assets higher, so investors should own assets—not cash.

Comments

Transcript

  • JK
    Jonathan K.
    20 February 2021 @ 13:01
    I've been long copper miners since May using Leap options. This is been one of the best trades I've ever done. Up about 1000%. It's interesting to hear that we may only be in the middle innings of this bull phase. On a personal note I expect copper to make all time highs during this run.
  • PW
    Paul W.
    18 February 2021 @ 10:02
    "student body right" ?
  • DM
    Don M.
    18 February 2021 @ 02:49
    Another episode of TG telling us what happened.
    • DM
      Don M.
      18 February 2021 @ 02:54
      Rear view mirror
  • MT
    Mike T.
    17 February 2021 @ 10:47
    just a small point, but seeing this segment is called the Daily Briefing and supposed to be commentary on 'todays' market activity then today these guys missed something. On Tues 16 we saw a large spike in Bond Yields. There is a mis-conception where many participants actually mistakenly believe, certainly the media seem to believe the Fed is some sort of supreme master of the universe and on their own, stress on their own, control interest rates. Wrong! The Fed in itself cannot dictate where interest rates are going, rather the Fed *responds* to Market conditions and current Market conditions signal 'Interest Rates' are going UP. The relentless move higher in Yields, plus also checkout the term structure of the Eurodollar Futures Market (interest rates) over the next few years remember as the /GE futures charts move lower = interest rates are going up i.e. moving ever further away from zero.
    • SM
      Sean M.
      18 February 2021 @ 02:02
      They talked about the 10yr hitting the highest in a year as well as the curve.
  • MK
    Marko K.
    17 February 2021 @ 22:47
    Pure gold .... excellent
  • AK
    Andrew K.
    17 February 2021 @ 21:34
    Apologize for my criticism of Tony in last interview. Love his perspective here and he's been right on the money.
    • JF
      Jack F. | Real Vision
      17 February 2021 @ 22:08
      I agree, Andrew, Tony has been right on the money!
  • MM
    Michal M.
    17 February 2021 @ 21:59
    Full of Truth. Very little repetition of the obvious, perfect.
  • sg
    scott g.
    17 February 2021 @ 17:56
    TG is the best
  • cr
    chiel r.
    17 February 2021 @ 16:11
    Ash...is there an explanation for the drop off in COVID infections in the US as the drop-off seems to precede vaccination progress....is there already some sort of herd immunity kicking-in (in combination with tax program) or are we still waiting for UK strain shoe to drop?
  • RP
    Raoul P. | Founder
    17 February 2021 @ 02:09
    Tony is such a great addition to the RV stable. His trader views add actionable context and commentary that big picture macro sometimes misses. The view from the trenches is invaluable and no one knows this better than Tony.
    • AB
      Ash B. | Real Vision
      17 February 2021 @ 05:04
      Hear, hear!
    • OM
      Owen M.
      17 February 2021 @ 14:49
      100% TGTuesdays is a must watch every week.
  • JG
    James G.
    17 February 2021 @ 13:20
    tony greer: stay long because. Protection? Why bother. Everyone is long, what could wrong? Like ever... Trade the bubble until it bursts then rush to the exit like everyone else. How profound.
  • SC
    Stuart C.
    17 February 2021 @ 12:14
    Real Vision has many things right, most of all it has TG on the RVDB!
  • JC
    JAMES C.
    17 February 2021 @ 04:44
    The surplus RE will be converted to farms..... a good LT outcome??
    • JJ
      James J.
      17 February 2021 @ 07:48
      Agree here, indoor farming on a large scale will be born of the commercial real estate glut
  • SL
    Shawn L.
    17 February 2021 @ 07:45
    Tony the truth of the tape is the wisest thing any trader has said to an investor...
  • JJ
    James J.
    17 February 2021 @ 07:44
    Great chat chaps!! commodity cycle, surfing at malls, Christmas lists from catalogues 😎 no stone left unturned but very valuable insights. 🙌🏻
  • JT
    John T.
    17 February 2021 @ 06:24
    Wish I could thumbs up twice. This has been one of those crazy RV interviews where I’m thinking Tony Greer is right and I’d better make sure that all of my super defensive TLT calls are matched by super aggressive plays. No more gold miners for me unless I dump a bunch of TLT because they’re too defensive to balance it out. I need to go where things are moving - silver miners, platinum, uranium, copper, home builders, etc. My current favorite idea is spend the weekend trying to find what gamma squeeze play is going on and buy shares. This week I joined in on a cash-burning EV maker ticker FSR. Another idea is to buy stocks in hot sectors and sell short dated covered calls on them, like I did with CCJ in previous weeks and with AG this week - both because they pay pretty decent premiums even if they go flat. I think this market continues up like a rocket until it drops like a rock, and I’m inclined to play aggressive with hopes to win.
  • DD
    Darrell D.
    17 February 2021 @ 01:31
    TG is such a great compliment to the broader RV macro views. It is very helpful to me to have both the longer term economic view and the the nuts-and bolts trader view. I see Tony's perspectives like a speedometer and compass, where the broader RV community is more like a map for me. Ash steered the conversation like Vasco da Gama (chosen for the options pun). Very pragmatic and actionable interview and a check on my own current emotional biases toward the markets right now. Thanks Fellas! Full bias disclosure: My wife insists I have a man-crush on Tony...She's usually right.
    • AB
      Ash B. | Real Vision
      17 February 2021 @ 05:06
      Ha! Thanks, Darrell!
  • TJ
    Tim J.
    17 February 2021 @ 04:53
    Good stuff Ash and Tony. Many thanks
  • EA
    EMRAH A.
    17 February 2021 @ 04:28
    Best segment ever. Talking trades should be more on this outlet.
  • DJ
    Dennis J.
    17 February 2021 @ 02:44
    I absolutely love Tony Greer's take. It's an "in the trenches" smack to the face and I end up saying thanks for the smack. More please!
    • SN
      Stefan N.
      17 February 2021 @ 03:26
      Rocking that ink and speaking like a foot soldier rather than an academic, love it!
  • MC
    Michael C.
    17 February 2021 @ 03:24
    Another sermon from the Church of What's Working Right Now...lol Several things come to mind. The cure for high commodity prices is high prices. I think the jury is still out as to whether we're seeing true, lasting demand or demand that has been pulled forward from Q3/Q4 with the "stimulus" checks being cashed around the world. I was in OK when Penn Square Bank took down Continental Illinois and the bankers drank champagne from cowboy boots. Guys in bib overalls paid cash for oilfield dozers. I remember the 2nd boom when oil hit 140 and 200 was a sure thing. Enjoy the run; a win is a win I suppose. Career risk...there goes Swifty...gotta chase to show performance or lose clients. "P/E's don't matter anymore"...;)
  • DJ
    Dennis J.
    17 February 2021 @ 02:47
    Filming at your local chinese restaurant however, is highly suspect
  • KC
    Kirk C.
    17 February 2021 @ 02:11
    Big city views about return to the office have no bearing on the rest of the country where people are more rugged than the big city denizens that have lived in fear of their environs from birth.
    • DD
      Darrell D.
      17 February 2021 @ 02:39
      Thanks Kirk, I had to look up both "denizens" and "environs" before I clicked the thumbs up. I think the conversation was geared toward big city real estate, not smaller regional markets. I'm a small market real estate investor and understand you sentiment completely - I think.
  • PB
    PHILLIP B.
    17 February 2021 @ 01:52
    More and more, it's looking like nuclear is the big miss in planning for future generating capacity in the US.
    • DD
      Darrell D.
      17 February 2021 @ 02:23
      I'm not sure what you mean by "the big miss". Can you expound? I think I agree since I've been long CCJ and URA for some time now but your comment is somewhat vague. I think nuclear is so necessary for the future, yet so undervalued at this point. Is this your line of thinking?
  • OM
    Owen M.
    17 February 2021 @ 01:32
    Jumping in mid-stream...i see what you did there Ash!
    • BM
      Bradley M.
      17 February 2021 @ 01:59
      The midstreamers will join the party soon. Can't get product to market unless the infrastructure exists. Been shook out a couple times entering too early. Now?
    • OM
      Owen M.
      17 February 2021 @ 02:08
      down stream, mid stream, up stream...and O&G joke..
  • DR
    Dave R.
    17 February 2021 @ 00:09
    Every time, Tony is so good
    • RT
      Robert T.
      17 February 2021 @ 01:59
      Absolutely. Tony is my favorite guest on the platform because he has skin in the game.
  • MK
    Michael K.
    17 February 2021 @ 01:32
    Love Tony. Great guy and great market comments.
  • bm
    bill m.
    17 February 2021 @ 01:28
    TG AKA as the Shark is weeping for the Southwest energy. Give me a break.
  • IN
    I N.
    17 February 2021 @ 01:22
    TG was bullish all year. I thought he had it wrong, but he beat me to submission I find comfort in how some of my positioning that paralleled his was based on exactly the reasoning he had. Respect the traders, not just the investors.
  • AP
    Adam P.
    17 February 2021 @ 01:21
    Love Tony Greer Tuesdays. #TGITGT
  • MR
    Michael R.
    17 February 2021 @ 01:08
    Good point about Bonds reacting to a spike in commodity prices. And yes, Bitcoin is a Freight Train. Choo, choo!
  • JA
    John A.
    17 February 2021 @ 00:13
    It is as if the US10Y yield knew Tony would be on today and wanted to make him even more confident than he is normally about his market view lol.
  • GC
    Gregg C.
    17 February 2021 @ 00:12
    Really enjoy Tony's insight and Ash is turning into a good interviewer. There is very little commodity coverage that the average person can access and understand and Mr. Greer is quite a resource.
  • MC
    Mark C.
    17 February 2021 @ 00:00
    Good as always. Would love for RV to do a series on what is changing as we come out. E.g. What will be done with corporate office space. What does the suburban landscape look like? What will malls be converted into? How does technology affect how we get together from Video games to Clubhouse to decentraland?