Back to the Drawing Board – Live with Alex Gurevich

Published on
May 18th, 2020
Duration
64 minutes

Private Money – Live with Nizar Tarhuni


Back to the Drawing Board – Live with Alex Gurevich

Live ·
Featuring Alex Gurevich

Published on: May 18th, 2020 • Duration: 64 minutes

In times of crisis, correlations break down. The strategies that worked yesterday cease to be viable, and more often than not, assets experience tremendous volatility as participants flock to safety. But while fear and hope rage, seasoned investors go back to the drawing board to come up with new ideas that can thrive under the new paradigm they are forced to navigate. To this end, Alex Gurevich, CIO and founder of HonTe Investments, will be joining Raoul Pal in this week’s Real Vision Live to explore opportunities within credit, currencies, equity markets and beyond as they try to identify assets that will perform during these times of crisis.

Comments

Transcript

  • CX
    Cindy X.
    31 May 2020 @ 19:16
    Listening to this one more time, I wish he was not interrupted so many times by disagreements. He is right so far. Thanks for inviting him. Yes silver!
  • JF
    John F.
    25 May 2020 @ 22:33
    Would love to have another Alex Gurevich talk with John Burbank. It would be great to hear again from John after the epic Eurodollar trade idea last year, which of course RP was onto as well! What is John's thinking now...
  • NH
    Nahum H.
    22 May 2020 @ 04:33
    This was one occasion where I wished RP stopped interfering - we already know your opinion, can we here the full exposition of AG's without interference? I understand the need to prod an interviewee who is reticent, or unclear, but here - I really wanted to listen to AG uninterrupted.
    • Hv
      Hannah v.
      25 May 2020 @ 04:25
      I agree with wanting more of Alex. He just pukes rainbows of concise volumetric acuity and I felt gypped as he was blunted. But I think we have to remember the point-of-view from which Raoul comes. At some point Raoul needs to cross-test his theory with his colleagues and we are invited to watch a live rendition of that play out. Raoul isn’t an interviewer in the typical sense of the role. He is participant with Alex and needs Alex’s push-back to solidify his own convictions. But yah, I would have liked to see him go for 90 min straight.
  • Hv
    Hannah v.
    24 May 2020 @ 18:29
    Love Alex! He takes multi-dimensional, multi-discipline correlations and strings them into tidy, tasty, actionable 3D-info-packets. Consistently one of the best idea-ists on RV.
  • HS
    Hubert S.
    20 May 2020 @ 11:20
    Thanks, very good. I was just wondering over this part of the transcript, also could not hear it any better: something does not add up logically in my reading/hearing/crosstalk reg: long rates short rates, currencies, Can Aud interest rate curves Please correct transcript mistakes, if any: "I think it's better to go for interest rates to other countries like Canada and Australia, where the curves are more persistently steep. And especially if you your view holds that this recovery will be muddling, the idea of Canada or Australia getting on zero rates is preposterous. And their pricing together with zero rates is partially because their swap spreads are so different from US and so much easier to bet on against rising rates on what I call commodity currencies. The developed market commodity currencies, they are so much better bets. "
    • DL
      Darryn L.
      22 May 2020 @ 06:55
      I agree, this isn't very clear. The Aussie cash rate is 0.13% today. 3's are curve controlled at 0.25% and 10's are 0.86%.
  • MC
    Michael C.
    20 May 2020 @ 06:45
    Found that interview really challenged my views, which is great. I wish it could be unpacked into some minutes. Would have been great to discuss the following in a more detail. 1) The "wall of potential demand ...disposable income" waiting which will boost the economy after lockdown ends - Who is he referring to here? The average consumer? I was confused by this comment. Most people live hand to mouth. 2) Didn't discuss the potential for a 2nd virus wave and what that would mean for the inflation/deflation arguments. 3) The ongoing question of whether bank reserves are money and the argument that low rates and QE are deflationary in the real economy and signal tight money not loose money. Maybe thats not Alex's thing,
    • MC
      Michael C.
      20 May 2020 @ 07:22
      Actually isnt there also a wall of pent up debt that needs to be paid when the economy reopens? Rents and mortgage payments have been deferred, not forgiven.
    • AW
      Angela W.
      21 May 2020 @ 07:31
      Agree Michael with your third point. That is Jeff Snider’s position exactly. Central Bank QE creating bank reserves has no inflationary impact. What matters is the Commercial Banks and whether they are willing to loan in conditions where businesses are strapped for Cash Flow facing the insolvency Raoul describes. When the banks stop lending, credit contracts, and the deflationary depressive conditions get worse. Fiscal on the other hand does go into the real economy. $3T so far, and another $3T under discussion. That may be what they are referring to as stimulating demand, fighting over fewer goods....food prices in particular.
    • MC
      Michael C.
      22 May 2020 @ 00:11
      Yes everything in this interview canbe summarised down to one thing..... it was a conversation around inflation expectations
  • AW
    Angela W.
    21 May 2020 @ 07:44
    Thank you for another wonderful and enlightening interview gentlemen. Raoul, that was an extremely useful piece of information thank you, that the gold miners did not crash for a second time after the Hope phase in 1929/30’s period. Mining stocks have been on a tear with GDX +25% since January 1st. Was wondering if they would drop again when the Insolvency phase retests the broader equity market bottom. What happened in 2008-2011 period?
    • AM
      A M.
      21 May 2020 @ 18:30
      This time round the miners are focusing on cash returns to shareholders. 2008-2011 they took on debt to fund takeovers at the wrong price. Kinross was a great example. It paid a fortune for Ecuador prospect Aurelian Resources which was the best discovery of that decade. Management failed to reach an agreement with the Ecuadorian Government and it was downhill from there. Lucas Lundin of Lundin Gold was able to buy the fabulous project for a tenth of what Kinross paid, and reached a deal with Ecuador. It pays to watch the best in the business and Lucas is one of them.
  • SF
    Simon F.
    21 May 2020 @ 10:19
    Whip smart - so stimulating to hear the big themes being looked at with a grasp of 2nd and 3rd order probabilities having been thought through.
  • sm
    sam m.
    20 May 2020 @ 07:01
    paraphrasing - "If not criminal it is grossly negligent for developed economy Governments to issue > 30 year debt" I didn't buy his argument and the argument wasn't backed up by reason.
    • LC
      Liliana C.
      21 May 2020 @ 05:21
      I thought he did back it up. The government keeps issuing 30 year paper at lower rates costing millions of extra mula to taxpayers as rates fall. In zero sum game if you/me/Alex made 30% with 1% drop on long rate, taxpayers lose, HFS win. Why not issue shorter term paper and save taxpayers the money?
  • lm
    luke m.
    20 May 2020 @ 08:47
    Are endeavour and Fortuna the better junior silver miners to play the silver bull market, already got SILJ and the majors.
    • ly
      lena y.
      21 May 2020 @ 03:56
      MAG?
  • MH
    Michael H.
    21 May 2020 @ 03:30
    Two thumbs up. Fabulous and informative conversation from two great thinkers.
  • MR
    Mark R. | Contributor
    20 May 2020 @ 16:31
    Alex is one of the best/original thinkers RV has on regularly and a true gold mine of good logic & thinking as it applies to trading. This was best demonstrated by the fact that his long stated view of long 30yr bonds has CHANGED. Another example of why he is a must follow cause he's been right for years but didn't become married to his view well after the move has ended. excellent interview
    • rr
      rlw r.
      20 May 2020 @ 16:41
      Yep, i concur - more Alex please when possible
    • DR
      David R.
      20 May 2020 @ 22:21
      Alex has also changed his bias on the dollar from bullish to bearish. Big FX regime change potentially in the works this week as the dollar hits multi-month lows against many currencies and sits significantly lower against almost everything tonight than when trump took office. The Asian + Risk bellwether AUDUSD pair is on the verge of making a STATEMENT if it can extend its recent 20% bull run higher against USD... "IF".
  • ea
    edwin a.
    20 May 2020 @ 22:13
    So many RV guests are great, but Alex has really rare insight and perspective. He has one of the clearest, most compelling investing frameworks of any of the RV guest.
  • DR
    David R.
    20 May 2020 @ 22:11
    I valued listening live as did other participants, judging by the live chat remarks. and now I additionally value the transcript of it. Greatly appreciated all around.
  • MD
    Matt D.
    20 May 2020 @ 21:30
    Great interview, surprisingly good. Some practical insights and thought-provoking conversation. Thanks.
  • IP
    IDA P.
    20 May 2020 @ 19:39
    thought processes... really excellent
  • RM
    Richard M.
    20 May 2020 @ 16:07
    ** Raoul/RV, Alex mentions (bottom of page 17 in transcript) about him "writing" about at the end of the last quarter that the rate space may still have opportunities and the new area of silver to look at. Do you think it would be possible to ask Alex to share that letter (newsletter/quarterly report?) with us? It's dated at this point so his subscribers/investors will have long since seen it and acted on it so they probably wouldn't be to upset with Alex sharing it. I know I would love reading it and I'm sure the rest of the RV subscribers would love to see it too. Please give this request some thought and if you agree that it's not too unreasonable please ask Alex if he would be willing to share it with us. Many thanks!
  • BB
    Bojo B.
    20 May 2020 @ 13:03
    Thank you, this was really good.
  • JN
    Jeffrey N.
    20 May 2020 @ 12:37
    Alex made the good point that owning options to hedge unexpected events the intermediate-term future is a good trade that is usually not expensive. With that in mind, he pointed out that "historical patterns suggest that the long end could wash out, really strongly. And strongly enough, given the current high convexity in it, that if you sell off 100 basis points, that's a lot of price drop"; therefore, I was wondering if he believes bond options to hedge or play this possible event are worthwhile.
  • PJ
    Peter J.
    20 May 2020 @ 12:16
    Great discussion, Alex's has been away too long.......sonner next time? So much to take in will need to read transcript.
  • DF
    David F.
    20 May 2020 @ 00:34
    would it be possible to provide subtitles for these presentations? and transcripts?
    • MC
      Melvin C.
      20 May 2020 @ 09:14
      I think they take a few days to appear.
  • lm
    luke m.
    20 May 2020 @ 08:47
    Are endeavour and Fortuna the better junior silver miners to play the silver bull market, already got SILJ and the majors.
  • WW
    Woody W.
    20 May 2020 @ 08:30
    Please upload the transcripts please! I love the interview and i need to study the transcripits. I struggle to understand his Alex's accent.
  • JN
    Jeffrey N.
    20 May 2020 @ 07:17
    Always like to hear Alex's views, he has strong convictions that are based on a systematic, thorough process. His methodology was intriguing in forming a long term thesis, taking a small position regardless of short-term conditions then later having the option to add or hold if it goes the other way - and only going big once price action proves he is right (similarly, PTJ said in his letter that one should form well thought out opinions but wait for price action to prove you are right). I find it challenging to pick the right entry point, even when my thesis is correct. The other point Alex made that markets make big unexpected moves every few years and to hedge this likelihood with high convexity options. It reinforced my similarly held view. A great example were the long-dated way out-of-the-money gold options that were dirt cheap last year.
  • PC
    Peter C.
    20 May 2020 @ 06:25
    Love Alex's candor & ability to reach a limited # of clear conclusions and milk them or it for many years. Sounds like gold, or better worded, precious metals is the place to be long.
  • DC
    Dave C.
    20 May 2020 @ 06:15
    Interesting to hear him on the gold miners and the fact that he was presently formulating his view. Suggestion - get him back when he has reached a conclusion. It would be really good if he was willing to outline the steps he took to reach his judgement, whatever it is.
  • BR
    Brian R.
    20 May 2020 @ 06:11
    agreed, thank you Alex, would be great to hear from Alex more often.
  • NI
    Nate I.
    20 May 2020 @ 05:31
    Good chat. Hope we hear from Alex more frequently. I definitely need to read his book. Thanks Raoul for having him on.
  • AV
    Alvin V.
    20 May 2020 @ 05:24
    Great interview. Love the deep dive.
  • DB
    David B.
    20 May 2020 @ 04:36
    Great interview! Thanks!
  • AP
    Adam P.
    20 May 2020 @ 04:22
    Alex never disappoints. Awesome stuff.
  • DP
    Duane P.
    20 May 2020 @ 03:20
    This was a really great interview!!!
  • TS
    Thomas S.
    20 May 2020 @ 01:57
    Great interview! Lot's good long term and process thinking!
    • TS
      Thomas S.
      20 May 2020 @ 03:09
      Raoul and Alex, you should listen to Rick Rule's interview on Real Vision if you want gold and silver trading strategies, when to buy miners, and which ones.
  • JS
    Joseph S.
    20 May 2020 @ 02:52
    Alex, thank you for the Eurodollar trade.
  • KT
    Kai T.
    20 May 2020 @ 02:32
    This is my favorite interview over the last couple of months. I could tell Raoul was also getting a lot out of it also. I was very interested to see that precious metals, silver (and platinum) specifically, and not just gold are on his radar.
  • MS
    Matt S.
    20 May 2020 @ 00:44
    I'm a fan of Gurevich - must get around to reading his bloody book!
    • KT
      Kai T.
      20 May 2020 @ 01:02
      It's excellent.
  • DW
    Desmond W.
    20 May 2020 @ 00:48
    wow RV you are amazing, having Alex go through his logic and rationale was fantastic, especially because he had several conflicting views to Raoul (who is a favorite). Thanks team RV and Raoul, a fun part of the day, keep it up.
  • Mt
    Miami t.
    20 May 2020 @ 00:41
    Great interview!
  • NF
    N. F.
    20 May 2020 @ 00:16
    This conversation was dynamite. Alex has a fascinating viewpoint.
  • NR
    Nathan R.
    20 May 2020 @ 00:09
    Great interview. PM conversation was especially enjoyable.
  • BP
    Barry P.
    19 May 2020 @ 23:57
    Excellent with Alex as always. Great convo.