Inside the Episode – Insider Talks (Dec 2020)

Published on
December 14th, 2020
Duration
30 minutes

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Inside the Episode – Insider Talks (Dec 2020)

Insider Talks ·
Featuring Roger Hirst

Published on: December 14th, 2020 • Duration: 30 minutes

In the latest installment of “Inside the Episode”, Real Vision managing editor Roger Hirst breaks down the most central points of discussion from December’s episode of Insider Talks, including reflation, the dollar, and Julian’s trade on FTSE 100. Roger explores the meaning of reflation as well as its impact on assets ranging from the U.S. dollar to emerging market equities, looking at data such as U.S. bond yields, Japanese stocks, and speculative positioning in copper and the Euro. Roger then analyzes how Julian’s FTSE 100 trade can be best understood through this lens, and he explores the currency dynamics of the FTSE 100 as well as its historical performance relative to the DAX. Lastly, Roger discusses the looming “quadruple witching” on Friday and the consequences of Tesla’s imminent inclusion into the S&P 500.

Comments

Transcript

  • JJ
    Jay J.
    6 January 2021 @ 16:59
    awesome!
  • IO
    Igor O.
    28 December 2020 @ 21:20
    Watching on 28th dec. Looks like Tesla inclusion and expiration are non event.
  • MP
    Matthew P.
    15 December 2020 @ 20:40
    Many thanks Roger - this preso was great! With regard to the M2 and the velocity of money, I could be wrong here, but my understanding (from Lacy Hunt) is that the QE-printed dollars can't be injected into the economy. Is that correct? This seems a critical point, because, if QE-printed dollars are not accessible (i.e. can't be distributed into the economy) then how does QE-printed dollars generate inflation? Warm regards, Matt P.
    • RH
      Roger H. | Real Vision
      16 December 2020 @ 10:37
      Hi Matt It’s correct that monetary policy (QE) has failed to create inflation or growth. For instance, the Fed doesn’t create money via QE – they credit the reserves of the commercial banks and then the commercial banks can create money via loans. Over the last decade, however, banks have been unwilling to lend (tighter standards and rising capital ratios) and many consumers have been reluctant to borrow (those that want to borrow are the ones excluded by tighter standards). As a result, QE has not led to an increase in money supply, growth or inflation. It doesn’t help that the central banks themselves claim that their efforts unequivocally create new money. This is from the Bank of England’s website: “Quantitative easing is a tool that central banks, like us, can use to inject money directly into the economy”. This year we have seen an increase in money supply because of fiscal policy, including wage and job support and this (rather than monetary policy/QE) has led to the rise in M2, which does now have inflationary potential. We still don’t know, however, if these savings will become consumption or kept in reserve for a rainy day. It’s also worth watching the Russell Napier/Brent Johnson interview where they discuss the US guarantees that could free banks up to lend more and finally boost lending. The switch from monetary policy to combined fiscal and monetary policy (in which fiscal will take the lead) is seen by many as the potential catalyst for higher inflation. Roger
    • MP
      Matthew P.
      18 December 2020 @ 00:40
      Many thanks, Roger! This is great feedback. All the best over Chrissy and have a Happy New Years!
  • BK
    Brian K.
    17 December 2020 @ 13:47
    Very helpful. Thanks.
  • AT
    Alun T.
    16 December 2020 @ 09:55
    Roger, where have you been? Need to see more of you!
  • MB
    Mathew B.
    16 December 2020 @ 07:52
    Great stuff. Very helpful.
  • WS
    William S.
    15 December 2020 @ 23:01
    Very good analysis...
  • KK
    Kenneth K.
    15 December 2020 @ 16:44
    Thank you for breaking it down and making it easier to understand...
  • TR
    Tobias R.
    15 December 2020 @ 12:24
    This is so useful, especially appreciate getting more context around the option expiry and Tesla inclusion - thanks Roger!
  • AM
    Aengus M.
    15 December 2020 @ 10:26
    Can we get the charts please?
  • OA
    Olivier A.
    14 December 2020 @ 23:00
    Fantastic presentation. Seriously, this selection of charts is outstanding.
  • rm
    roland m.
    14 December 2020 @ 21:57
    Very clear and instructive explanations, thank you very much!