The Market Cycle Master

Published on
February 15th, 2019
50 minutes

The Market Cycle Master

The Interview ·
Featuring Howard Marks

Published on: February 15th, 2019 • Duration: 50 minutes

Legendary investor Howard Marks, co-founder and co-chairman of Oaktree Capital Management, explains how he invests successfully, fully aware that nothing is a sure bet. In this conversation with Grant Williams, he breaks down how he has navigated market cycles, and outlines the dangers that lie ahead in a world dominated by moral hazard and political polarization. Filmed on January 31, 2019 in Boca Raton, Florida.


  • DS
    David S.
    24 February 2019 @ 20:47
    Again, I applaud Mr. Marks for his work on trying to rebalance the political system. A sense of being treated unfairly is in out DNA - primate studies. When we feel we are not being treated fairly, anger about the unfairness arises simultaneously – populist appeal left or right. This anger can remain or be replaced by other emotions or rational thought. Empathy gives us the ability to see unfairness from others’ point of view – human thought. If we rationally approach these social/economic problems, fairness can be improved. If we stay in our own echo chambers, we will not succeed. DLS
    • SD
      S D.
      6 March 2019 @ 09:42
      How very patronising. And irrelevant.
  • SD
    S D.
    6 March 2019 @ 09:41
    To assume that Trump is an aberration is naive, and expectations that "democracy" will self-correct are ridiculous. What follows from here is worse, possibly much worse, simply because the financial sector has refused, consistently, to conduct itself responsibly. A 52 percent tax rate? That's the least of your worries.
  • SD
    S D.
    22 February 2019 @ 06:02
    Howard Marks doesn't get populism Populism is democracy. It's not evil, dangerous or troublesome, Grant. Crikey, lie down and take a deep breath. Populism is a move towards direct democracy to enforce the democratic will upon those who refuse to respect their representative responsibility. The financial sector needs to realise its glory days are over. It's not the populists who are destroying it. It's a consistent track record of bad practice, and a lack of self regulation. Slamming those with alternative political opinions driven by their experience of that malfeasance just isn't smart.
    • DS
      David S.
      23 February 2019 @ 00:39
      Populism does show discontent with issues that urgently need to be addressed. Unfortunately populist governments do not have a history of ruling well and we may have a lot of them. The world certainly needs a better balance, but that is above my pay grade. DLS
    • DS
      David S.
      24 February 2019 @ 19:47
      Populist appeal to the emotional wants and needs of the voters to get elected – free everything, no immigration, no taxes, etc. Some new Democratic candidates are populist and use the same emotional appeals to the voters that we see on the Republican side. Reasoned legislation is in jeopardy. Jeffrey Gundlach said his marginal tax rate between Federal and California state taxes is over 52%. He suggests closing loopholes so similar income earners pay the full tax. Others have suggested that the capital gains tax be removed so income and capital gains are taxed at the same rate. Legislators must look hard at the revenues and expenses of government to solve the imbalances, not appeal to emotions. Being upset about government policies is a starting point. Emotions must be put aside when trying to solve the problem. DLS
    • RP
      Ryan P.
      26 February 2019 @ 01:49
      David S. We live in a world now where emotional responses lead irrational thinking into the spotlight. Populism and tribalism often overlap each other today. “I’m proud to be a trump supporter to fight for what’s right for our country and me” or “I’m proud to be a democrat to fight against what’s wrong aka Trump and all he stands for”. What’s ironic is the true definition of populism is ordinary people fighting and rising up against the elite. Trump tapped into that emotion way better than any other candidate, even though he would be considered what statistically is the elite of the elite. He also supported many liberal and democratic politicians in the past. How does one rationally explain that a lifelong “elite” Democrat by trade, ran a republican campaign against the elite, and won the presidency only to embody an autocratic leadership style....this is why people think he colluded , because to many it makes no sense where we are today. I don’t know where we go from here but I have a strong feeling the two party system is in its waning days and we will resemble a country with further tribalism and populism only to elect even more radical leaders... but what do I know. Again , to think out country will shift away from democracy is silly. The country will self correct eventually. It always does. People will look back and think , wow we thought we would become Italy or Greece or Russia or Venezuela... but we won’t. America is what it is for good reason. Democracy is self correcting over the long term. Right now the biggest threat to the democrats and AOC is Trump getting re-elected and America’s biggest mishap is being ignorant enough to think it can’t happen. I would love someone like Marks to be interviewed by Mike Green. (Grant was still great). Sorry for the rant.
    • DS
      David S.
      26 February 2019 @ 09:19
      Ryan P. - Well said. Not a rant. Democracy can self-correct if it has time, transparency and the rule of law. Trump won the election because he gave the voters a message of correcting their problems that they were ready for. He will be a difficult opponent for a second term as he already has a lot of money in his war chest. He needs, however, to get a majority of the electoral vote to win outright. Jeffrey Gundlach stated that if three or four candidates run in 2020, the election may be voted on in the House for President and the Senate for Vice President if no one has a majority of the electoral college. That would put a lot of wood on the fire. DLS
  • JH
    Jesse H.
    17 February 2019 @ 01:37
    Good interview, and quite a few astute and eloquent comments by HM. Did not like some of his prickly comments in reply to Grant - seemed a bit arrogant - and disagree on...
    • DS
      David S.
      24 February 2019 @ 05:23
      I do not think he was being disrespectful, he trying to state his position accurately. DLS
  • FG
    Flavio G.
    17 February 2019 @ 15:07
    Enjoyed this interview. There is just one thing that Howard mentions with which I disagree: the mortgage crisis was not developed as a consequence of "funny things going on in Wall St", it was caused by government intervention and subsidies channeled through Fannie & Freddie. Wall St being Wall St seized the opportunity of making easy money and clinged to the free lunch it was provided by those easy-money vehicles.
    • MS
      Michael S.
      17 February 2019 @ 18:28
      Hey, Flavio, was Fannie buying Spanish mortgage bonds? Irish mortgage bonds? What did Fannie have to do with Iceland imploding? The Icelandic people didn't blame Fannie -- they put their own bankers in jail! It's so easy to knock that "the government did it" argument out of the water. Just admit it: "The Great Recession" was one of the greatest failures of free-market capitalism in history. The only way you can learn from your mistakes to admit them. How does Goldman Sachs have to borrow money from Buffett if they are so smart, and so much more clever than all those "government bureaucrats" to whom their fine firm just, what, fell victim? Why did GS have to cheat Marc Cohodes and Michael Burry, just to stay alive? Because Fannie and "subprime borrowers" (read minorities) screwed it up for Goldman Sachs? Hilarious story!
    • SD
      Stephen D. | Contributor
      18 February 2019 @ 01:20
      I think this is one of the most important and least debated aspects of the Great Financial Crisis of 2008. Was it a failure of free market capitalism, too loose regulation of financial entities, or was it caused by distortions created by Central Bankers and Government agencies? The Governments decided it was the former and decided they were blameless and more regulation was required; but as I was trading through 2006-2008 I didn't see 'free market capitalism' at all. The banks were definitely doing "funny things", but what allowed them is a very important question. If we want to avoid another 2008 we need to learn the correct lessons, I don't believe we've even tried yet.
    • FG
      Flavio G.
      18 February 2019 @ 13:17
      Michael, I can't comment on the Irish or Icelandic bubbles (wasn't paying close attention then or after) but the one I know about something was the Spanish one since I was living there when the thing collapsed (BTW: I was telling my local colleagues @work to sell the circus 2 years before, the problem was: Spain never had a property bubble -just a plateau in the 90s-, so they couldn't relate to what I was telling them. They just thought I was stupid). Anyway, besides the fact that it was a real bubble in the sense that it was fuelled by crowd psychology, you can still see clear government hands overheating an already heated market by providing tax benefits to those purchasing new property, decreased interest rates by association to the EU and the EUR (instead of the Peseta), massive public infrastructure investment funded by the EU (with the effect of crowding-out private-purpose construction and artificially increasing builders' wages) and finally, government-promoted artificial scarcity of residential land (in a country with low pop-density, but if available, politicians wouldn't be able to exchange construction licenses for $. favours or campaign 'donations'). Funny fact: Again, in 2018 the Spanish government announced new subsidies for property buyers. I guess 10 years is enough to forget or perhaps they never understood how supply / demand dynamics work.
    • MS
      Michael S.
      20 February 2019 @ 05:22
      Stephen D: The reason it's not "debated" is because it's a matter of religion to most people on any side of the debate. I don't have that issue, so I say the answer is "D. All of the above." But someone should have to defend a view like "the mortgage crisis...was caused by government intervention and subsidies channeled through Fannie & Freddie." That's all? Not the tens (hundreds world-wide) of millions of borrowers, or Bear Stearns, or greasy fraudulent mortgage brokers, Chuck Prince, the aforementioned GS, Bill Clinton (and the veto-proof Republican majority in Congress) who cut the horses loose, etc. etc.? I mean, already that sounds like a pretty robust web of interconnected parties making choices, right? So I don't buy the "there wasn't free market capitalism." I am guessing that the free market is, even if it looks different. And now we have an ocean of central bank money and the hopes of 1 billion securities owners over-correcting us from one ditch to the other, all the way on the other side of the road. What's not free about that? Your notions? The free market just is. Or it never was. Like Zappa said "Jazz isn't dead, it just smells funny."
    • DS
      David S.
      23 February 2019 @ 00:46
      There is enough blame to go around. It was the S&L crisis on steroids. DLS
  • SD
    S D.
    22 February 2019 @ 06:08
    The centre of democratic party is defunct simply because it abandoned its responsibility to its traditional base and adopted, wholesale, the neo-liberal economic agenda. So the Democratic Party is dead in the water unless it wakes up and shifts in favour of AOC. The real issue is one that once again nobody is discussing. Populism is the future, and things look ugly for those who consider themselves "elite." They're anything but. The question though is, does the future belong to the right wing populists, or the left wing populists? All this whining, along the lines of - "Gosh these people are so stupid. Of course socialism doesn't work" - reveals actually only the profound stupidity of those who think they're so much smarter than anybody else. We confront a future of profound political volatility, with the major political parties demonstrably bankrupt of ideas, integrity and a future. Instead we will see issues-driven allegiance by voters, most of whom what the financial sector destroyed. We're talking the end of central banking, and total disruption. And it's the financial sector who did this, and brought it not just upon themselves, but upon the rest of us. Because they're all a bunch of greedy dicks who refused to conduct themselves responsibly. So don't blame AOC and all those insisting upon change. And don't think that you guys are the ones who are in any kind of role to generate some nonsensical "no label" type of political future. You have no credibility and nobody cares what you think.
    • DS
      David S.
      23 February 2019 @ 00:29
      What standing do you have? Just interested. DLS
  • AC
    Andrew C.
    22 February 2019 @ 02:54
    The market cycles Mr Marks mentioned had strong sentiment cycles, all the way to euphoria. To me, it appears we are still climbing a wall of worry in the markets today so I expect a lot more upside yet..... Is there any interview on RVTV talking sentiment cycles?
  • MM
    Mike M.
    16 February 2019 @ 16:53
    The 800 lb gorilla in the room are the Central Bankers, the academics have put us on Pluto and now cannot get us back. We have seen the greatest transfer of wealth in the history of the country!!! Now we have people debating the politics of populism/ socialism/'no Labels'? When the bond vigilantes and China, Japan, and Russia tell us no we are not buying your paper/bonds changes will be made. Ponder the question what if 'no label's' are followed by 'yellow vests'.?
    • AJ
      Aaron J.
      21 February 2019 @ 19:13
      Aren’t the actions of the central banks more a symptom of the underlying political and societal issues? It’s hard to deny what the CBs did after the financial crisis saved the system - even if the exit took far too long. The corrupt political system, extraordinary power of industry lobbyists, lack of effective anti cartel regulation, unequal access to education, are some of the root causes.
  • p5
    peel 5.
    21 February 2019 @ 01:02
    Terrific! Nothing else to say
  • PF
    Patrick F.
    20 February 2019 @ 22:28
    Fantastic Interview! Keep em coming...
  • DS
    Dimitri S.
    20 February 2019 @ 21:40
    “No Labels” may sound like a well meaning group but the reality is they are Progressives in disguise.
  • JY
    James Y.
    20 February 2019 @ 06:33
    I have liked this video, but feel just 45 minutes with Howard Marks is just not enough when I’ve heard hour plus interviews elsewhere.
  • NI
    Nate I.
    20 February 2019 @ 05:24
    Marks: "Something like 80% of Americans think there should be some gun controls And you can't get them. What does that mean? It means that the politics and tactics of division somehow are stronger than the tactics of togetherness" Not quite. It means there is still a few members of Congress and an occasional President who remember the Constitution and their oath of office to uphold it. Marks decries that 80% want to confiscate his wealth (and sadly it just might happen), but he is unhappy that 80% can't get gun confiscation enacted. News flash for you Mr Marks. Democracy is another name for mob rule. That's why America was set-up as a Republic (as you might recall from grade school: "I pledge allegiance to the Flag of the United States of America, and to the Republic for which it stands"). The same [dying] Republic that protects you and your money from confiscatory taxes (i.e. protects your property rights) also protects the rest of our rights including the Second Amendment. If you think destroying some rights based on mob rule won't lead to all rights being destroyed by mob rule, you simply have no grasp of history or even the ability to conduct a simple thought experiment.
  • my
    markettaker y.
    20 February 2019 @ 02:23
    Meh. Who hasn't heard all this a million times before, often said just as well if not better? Conventional contrarian wisdom.
  • RW
    Randy W.
    20 February 2019 @ 01:10
    This was a terrific interview, Grant. I'm new to your platform, but I'm already very please with what I'm seeing and look forward to past and future content. Thank you!
  • KJ
    Kelly J.
    16 February 2019 @ 00:24
    I found Marks comments on market cycles and his investment approach had quite a few useful tidbits of information - eg, the quality of the available 'deals' themselves tell you whether it's a good time to invest or not without having to second guess where the market cycle is at - when people are greatly risk averse, there tend to be 'load up the boat' investment opportunities, when people are extremely over-optimistic, the quality of the investment opportunities tend to be much worse, more likely to be 'losers' in terms of what they can realistically return. Another was that the economic cycle itself is relatively mild - running from 'good' to 'not so hot', but the boom and bust aspect is due to leverage and psychology. Though, at one level, I was glad Marks is actively trying to find a bi-partisan political solutions, overall, I found Grant & Marks political discussion to be remarkably simplistic and predictable - not that useful. Better to just stick to your great skill set in investing topics guys, or be ready to dive much deeper! Of course, free market capitalism has been a great engine of innovation and massively helped build the global economy, but throwing around labels like 'planned economy socialism' vs. 'free market' capitalism as though what built the US into a great country and economic power was only the free market capitalism aspect of our society or what holds back other countries was 'socialism' just isn't accurate. When they were talking about Ocasio-Cortez being naive and inexperienced enough to push for a 70% marginal tax rate, I thought Grant was going to point out that the high end marginal tax rate in the US was 70% or above for much of the 20th century, and in particular, from 1936 – 1980, the heart of the period Marks (and many conservatives) think America was greatest for most Americans. Well, folks, that was one reason. We had money to build and maintain infrastructure, for GI bill, for education, etc. And if we had it today, we would have at least some of the money needed to keep underwriting that "socialist" program called social security Marks is worried about running out of money. I’d feel more interested in their political conversation if a) they were better informed, b) if they realized the simplistic labels are kind of empty and c) if they proposed some possible solutions rather than just criticizing straw man positions regarding ‘socialist planned economies’ they ascribe to Ocasio-Cortez and others. We already have a planned economy: it’s the massive, planned inequality guaranteed globally by central bank money printing and credit issuance in support of wealthy asset owners, speculators and stock jockeys around the world. Imagine what would have happened if we’d had ‘real capitalism’ – including real failure, real loss, real widespread bankruptcy as a consequence of mal-investment, etc. since the 1980’s? People would care alot more about exactly where they are placing their money at risk, because their next batch if they lost wouldn’t just be handed to them at virtually no after inflation cost.
    • EN
      Eric N.
      16 February 2019 @ 04:52
      Name one thing you accused them of you didn't do in your own comment.
    • JP
      Janusz P.
      16 February 2019 @ 09:23
      Very well said Kelly. The US history is a proof whether higher taxes worked. See the comment I made earlier.
    • KJ
      Kelly J.
      16 February 2019 @ 17:46
      Eric - as clearly implied by my comment, part of the solution is indeed raising taxes on the wealthy back to 70% (and/or above), as they paid for a great phase for most Americans in almost half of the 20th century. And another part of the solution is for the central banks to not just print money and credit and pass it out as they do now in a biased way to the folks who are already the richest worldwide, but instead, as in the 1930's, dedicate a portion of the printing - and believe me, central bank printing >is< going to continue if we're to avoid worldwide depression - to public green, renewable energy and other infrastructure projects, job retraining, education, etc. And your solutions are....? Please elaborate... George C. wrote a great comment below on Mark's views, and linked to this very good commentary:
    • DS
      David S.
      16 February 2019 @ 19:04
      Although I am sympathetic to your argument, I would not trust our current or recent representatives to spend additional tax revenues well. I really agree with term limits. I would also like to see a one term limit for President for four or five years. DLS
    • TM
      The-First-James M.
      17 February 2019 @ 13:10
      What you talk of as a planned economy in your final paragraph is anything but this. It's crony capitalism - the worst of both Worlds.
    • KJ
      Kelly J.
      19 February 2019 @ 01:29
      Exactly, The-First-James - I was using the 'planned economy' phrase sarcastically in the last paragraph. Trickle-down economics was disproven ages ago for anyone willing to see the truth. But that doesn't stop well-paid, well-spoken academics who like to be in with the in crowd from pouring trillions of dollars of after-inflation free money into the tills of the richest banks, businesses and people on the planet. There's some theory that they're the most likely to get it out to everyone, but it hasn't worked out that way for quite awhile now. Anyway, IMO, anyone who can't acknowledge how deeply rigged this current game is is kidding themselves. That's why Ray Dalio and some others who are a bit more serious than Marx on this subject are speaking out on the great danger that wealth inequality is beginning to pose to the financial and political systems, and therefore to the world as a whole these days.
  • JF
    Josh F.
    18 February 2019 @ 11:06
    I think it's silly to suggest that the wealthiest Americans have not shifted the system to their own benefit. They worked tirelessly to cut taxes and were very successful. The alternative to the Libertarian capitalism we're seeing a backlash to is not totalitarian planned economies, it's likely something closer to the Nordic states or Northern Europe.
    • VM
      Vincent M.
      18 February 2019 @ 17:52
      The Nordic system will not work in such a large diverse economy. These countries have strong national identities and much less diverse economies. We will probably make a mess of our economy as it swings from from pro government to pro business. I for one prefer a national sales tax to taxes on work and capital. Count me in the Fair Tax plan cohort. Glad to pay based on my consumption.
  • CS
    Chris S.
    18 February 2019 @ 17:30
    Grant, is it possible you have been a little nervous on this one? ;-)
  • mh
    martin h.
    18 February 2019 @ 08:50
    Just got the book. Great start
  • JP
    Janusz P.
    15 February 2019 @ 22:55
    To GRANT WILLIAMS: What a shame! The high marginal tax rate hasn’t worked? Please do your homework. For around 50 years the effective marginal tax rate in the USA was around 65-70%, with top rates reaching at times 90%. It wasn’t until the Regan era that the top rate was lowered to 50% in 1982 and only 28% six years later. Now, I’m not leftist but are you going to argue that those 50 post WW2 years weren’t some of the best years in US for overall growth and equality when the true wealth was built across entire nation? Again, do yourself a favor and look up the history. To your honorable guest Howard Marks: the wealthiest individuals unfortunatelly contribute very little to the sociaty and so your „punitive/confiscatory tax” comment doesn’t stand rhe ground. And even if they were allowed to keep „only 20-30%” of what they make that’s still plenty. Now, can they „do smething about it?” Sure, but keep in mind that as a US Citizens they have to pay US tax regardless where they are, that’s the price of „protection” they get. So they are free to renounce their US Citizenship and move elsewhere. I wonder how many other places in the world one can so easily making a killing by milking it’s own nation. Dear Mr Howard Marks: it’s not the punitive/confiscatory tax. It’s a right to do business in the USA, it’s a military protection that no one else will dare to come, invade and confiscate your wealth. And finally, it’s a piece of mind that your own (otherwise extorted) people will not rise up against the so called „elities” and confiscate what they own, resetting the system. French Revolution comes to mind, but that’s another lesson in the history.
    • KJ
      Kelly J.
      16 February 2019 @ 18:13
      The world's a complicated place. We need innovators, risk takers, investors, builders, visionaries and the financial and social acclaim incentives to create great things. We also need to STOP giving a free ride to people who are already hugely wealthy by global central banks repeatedly saving their bacon from capitalism's normal failure cleanings and thereby supporting their literally UNREAL wealth figures that will never, ever actually be converted into future goods and services. IMO, at this point, the world has written a huge, multi-hundred trillion dollar check to the public in pensions and other programs AND to the wealthy in their stupidly large brokerage statements that, in total, will never, ever, be paid, period. Future value isn't produced by printing money, folks. It's a trick that just provides bragging rights and financial/political control in the present, since 'money is speech' according to our deeply corrupt Supreme Court. There will be no way to avoid public policy decisions and market events that, between the two, decide who actually gets future value promised to them.
    • PD
      Peter D.
      17 February 2019 @ 13:43
      Enlightening thoughts by Greg O. about how much of taxpayers' money governments should steal. However don't forget that the high US tax rates of 1945-1980 coincided with a time during which America had no competition on the world stage, after having flattened much of Europe and Japan with Atomic and other bombs. When you have no competition, you can overcharge for products and labour, as America did. By the 1970s those advantages were clearly fading. Today - other than reserve currency status - they are gone. Raising taxes on the rich will feel good. However the money isn't there....and soon after.... governments will reach the average guy's wallet.
    • NA
      N A.
      18 February 2019 @ 05:16 You can skip straight to the Appendix.
  • AD
    Abhijit D.
    18 February 2019 @ 02:11
    Great interview. The clarity of thought and the ability to elucidate in an interview is striking. Thank you!
  • SW
    Scott W.
    15 February 2019 @ 23:09
    B. Sanders, E. Warren and AOC are views from the "other side" if one is a proponent of classical liberty and free markets and the US Constitution and its philosophical underpinnings (some of which originate in Grant's beloved England). I hear their views incessantly because they dominate treatment by WaPo/NYT/CNN/ABC/CBS/NBC/NPR/PBS/LaT... Confirmation bias does not resonate with me as part of "the problem" from "my side".
    • DS
      David S.
      16 February 2019 @ 23:34
      From my side?? Is that a confirmation bias? Classical liberty and free markets never existed and never will. The balance - “..ay, there’s the rub..” between civil society and personal liberty. DLS
    • SW
      Scott W.
      17 February 2019 @ 19:56
      @DLS. No. Taking a decision on a material issue is most certainly not confirmation bias. It's simply choosing. Exercising one's faculties if you will. If one never does that, that one is merely driftwood.
  • CC
    Chandler C.
    17 February 2019 @ 19:22
    Great interview; Howard’s memos have been fundamental in my understanding of the markets.
  • SU
    Shakeel U.
    17 February 2019 @ 18:20
  • NR
    Nicholas R.
    17 February 2019 @ 15:47
    Great interview. Marks strikes the right balance between confidence and humility.
  • CB
    C B.
    16 February 2019 @ 21:49
    All of us RealVision subscribers desire knowledge. Valuable knowledge. What if everyone thirsted for knowledge? What would be the quality of our society then
    • TM
      The-First-James M.
      17 February 2019 @ 13:17
      Sadly, we will not get there. Too may people cherish their ignorance - some members of my immediate family being some of these people...
  • SD
    Stephen D. | Contributor
    16 February 2019 @ 04:53
    I had the good fortune of meeting Howard Marks recently. Not only one of THE great investors of the age, Oaktree's performance is incredibly good, but also a very articulate writer and speaker. I too was somewhat surprised by the focus on politics in this interview, as some other comments reflect. But if Mr. Marks is worried about it, we should be too. His 'memos' are rightly legendary (and free) and he has had an extraordinary record of seeing problems before they become mainstream. One of the wisest and clearest thinkers in our industry, and a very nice man too, as this interview confirms. Nobody got poor investing with this man or following his advice. Forewarned!
    • TM
      The-First-James M.
      17 February 2019 @ 13:15
      That was very well said Steve. My own personal view is that politics is going to increasingly influence the economic cycle going forward, until the pendulum swings the other way. We all need to be cognisant of this, and try to plan/prepare accordingly.
  • AG
    Adam G.
    15 February 2019 @ 20:14
    I have read his most recent book cover to cover and yet in the book there is almost no mention of Politics, how so then, in this interview there almost a singular focus on this very CNN-ish stuff ???
    • KC
      Kenneth C.
      15 February 2019 @ 20:52
      I would say it's probably been a testament to HM that he has stayed on mark for so long without going there. He did with the latest memo. Ignoring that, he is what I think of when the word fiduciary is mentioned. He has my respect. That plus whats in his wallet will pay for a really nice date night with his wife.
    • TM
      The-First-James M.
      17 February 2019 @ 13:05
      I'm going to say it again to yet another comment-leaver. Politics is increasingly going to influence the economic cycle over the next decade and possibly beyond, until the pendulum swings the other way. The two are not distinct and separate. This is the insight you should take away from this.
  • AG
    Adam G.
    15 February 2019 @ 20:03
    Whoa....lots of politics...almost 45 seconds on eco cycles...nice work guys !
    • TM
      The-First-James M.
      17 February 2019 @ 13:04
      Politics is increasingly going to influence the economic cycle over the next decade and possibly beyond, until the pendulum swings the other way. The two are not distinct and separate. This is the insight you should take away from this.
  • so
    steven o.
    15 February 2019 @ 16:49
    I expected more insights on investing - too much discussion of politics.
    • KC
      Kenneth C.
      15 February 2019 @ 17:06
      I've not watched the video yet (plan to), but based on his last "memo", this is no surprise. I have a great deal of respect for Mr. Marks, I find him very insightful. His last memo, however, was not substantive. I will watch the video and comment if I feel the need to.
    • TM
      The-First-James M.
      17 February 2019 @ 13:02
      I think the insight you should take away from that is that politics is going to increasing influence the investment climate, and possibly the asset allocation decisions you will need to make. Speaking as a Brit who voted for Brexit, it's already begun. #GotGold?
  • VS
    Vasil S.
    17 February 2019 @ 04:36
    Truly excellent, worth the RV annual subscription alone! Great questions by Grant!
  • SS
    Steven S.
    17 February 2019 @ 03:01
    Excellent discussion. Thank you Grant and Howard.
  • JH
    Jesse H.
    17 February 2019 @ 01:41
    ...suffering of the middle class, let alone the poorest among us. Severe wealth inequality, in my view, is a hallmark of a morally bankrupt society...that is how I see the US now as a whole sadly.
  • JH
    Jesse H.
    17 February 2019 @ 01:39
    ...comments regarding populism. While I am a strong proponent of capitalism, I am concerned to see how out ot touch the very wealthy are with the very real and pressing needs and...
  • AK
    Andreas K.
    17 February 2019 @ 00:03
    loves this guy. even if he says the same things all the time in slightly different ways.
  • DS
    David S.
    16 February 2019 @ 22:50
    Great interview and I am enjoying the constructive comments! We have seen Powell jawboning. I expect at least one Fed rate increase this year per Mr. Druckenmiller “slip it in when you can.” Employment should remain high, wages will continue to grow, but CPI will not keep pace as corporate margins are eroding. The Fed rate increase and/or selling off the balance sheet will be to attenuate the stock market bubble. If the Fed has a new mandate of supporting the market, it should stop the market from overheating through financial engineering and/or easy money. It is the responsible thing to do. DLS
  • AM
    Amy M.
    16 February 2019 @ 15:45
    It strikes me that if capitalism doesn’t have the gut/immediate appeal that populism does, if it only holds intellectual appeal currently, then we know what the root of the issue is. Populism, good or bad aside, appears to be a grasping for agency and ownership. At what point did capitalism cease to fulfill that very normal human need, where did that turn? When/if populism feels like agency/ownership to the majority, my guess is it will also become a more appealing ideology and practice than populism to fulfill that need.
    • AM
      Amy M.
      16 February 2019 @ 22:17
      *sub out the 2nd to the last populism w/capitalism and that last sentence will be more coherent. Thumb-responses on the run are always risky.
  • DS
    David S.
    16 February 2019 @ 21:52
    Populism is a sign of problems within the society. Many of the original settlers in the English colonies were populist who were able to improve their lot and provide a better future for their children by immigrating – both economically and religiously. Populism in France took the form of immigration and the French revolution – chop off every noble head. Populism in the USA took the form of President Roosevelt in the depression with the New Deal. Especially governments of the people, by the people and for the people cannot continue by neglecting the interest of the poor, the average or the wealthy. It is always the balance that counts, but difficult to achieve. Balance cannot come from ideologues especially in fear of being reelected. One term limit for the President will promote better focus. In politics hatred is an easier sell than reasoned improvement – on both sides. I value Mr. Mark’s political approach of funding politicians who wish to solve problems and not just get reelected to vote hard left or hard right. Good luck! DLS
  • JA
    James A.
    16 February 2019 @ 21:37
    Great interview. Grant, you looked genuinely humbled to be sat asking one of the greats such questions at times! As any of us should.
  • GC
    George C.
    15 February 2019 @ 12:08
    Mr. Marks grasps the situation, in part, but provides no leadership in addressing the inherent flaws in the rigged system that has rewarded him so richly. Worse yet, he has far more criticism--and seemingly far less compassion--for the have-nots than the haves who have brought society to the breaking point. All of that said, he's been a wonderful resource for budding investors over the years, although it's less clear he is adept at figuring out what to do in this central bank manipulated market.
    • rw
      rory w.
      15 February 2019 @ 12:33
      Compassion isn't a symbol in math. The markets are math, if you bring that to the market you will lose every time. The vast majority of have-nots don't understand the markets nor do they care too. The 2008-9 bank bail-outs was this, the have-nots who actually had little to lose because they owned very little in MBS and CDOs bailed out the haves. In return the haves assets received massive inflation and the have-nots only received less for more.
    • DR
      David R.
      15 February 2019 @ 19:12
      But in 1.7 years, when the increasingly socialist dems sweep the US presidency and congress, they might well enact with a vengeance their platform of "redistribution, social justice and make the rich pay" (the threshold for "rich" being certain to fall precipitously, as the *median* american individual income is only $30,300)..... Expect 70% income tax on higher incomes, annual wealth taxes (which undoubtedly will be increased rapidly in tax-rate on ever-lower thresholds of wealth ), and in particular, very high special surtaxes on passive (investment) type income. Already numerous other western countries are reforming their taxes to ensure that investment income is taxed much higher than wage income. And same for income derived from a private corp or business.
    • KJ
      Kelly J.
      16 February 2019 @ 17:58
      Excellent comment and link, George, and well-spoken, rory! That essay in the link really gets to the core of it, George: Marks is a great proxy for the wider attitude of the elites’ – (and no one should doubt by now that ‘the elites’ are quite real and heavily influence public policy). They’re smart enough to see and understand the problem, but not willing to actively give up anything to solve it. Mark's attitude seems to be, 'when they come to take our wealth, let's have a reasonable conversation." At one level, that’s understandable as the current evolution of human nature. And of course, that's where your comment comes in, David. I can see the possibility of the wave left you're talking about taking over government to tax that wealth, but I've always imagined that the powers that be defending their vast money piles - much ill-gotten via systemic money-printing protection and levitation - won't be vanquished that easily, but are already putting up quite a fight, given the mass overhaul underway in our court system including, IMO, a Supreme Court increasingly supportive of 'tyranny by wealth' as a freedom guaranteed by the Constitution vs. the risk of ‘tyranny by the people (majority)’ (gov't of, by and for the people) constitutional right that elites and Libertarians seems most deeply concerned about. After all, at this point, the Republicans, ambassadors of the wealthy, still largely control the government. But is it finally possible that corruption in both parties will be seen as out of control as it really is? What happens if the markets and the economy goes down between now and 2020, on the watch of the current administration? Maybe your prediction of a left wave inundation becomes more possible, David. We’ll see.
  • JS
    Jeffery S.
    16 February 2019 @ 15:40
    Well done RV to get Mr. Marks on as a guest. This interview was much like reading one of his memos or books, filled with subtle comments that will be impactful over time and something you can come back and revisit. I really enjoyed the moments when Grant got Howard thinking of topics he hadn’t done more of a “deep dive” on and hear what his initial reaction and comments would be. He is a very disciplined person in his thought process and comments, which is a great lesson to all.
  • FS
    Felipe S.
    16 February 2019 @ 08:47
    Wonderful, it would be great to have Howard Marks as a regular guest given that he is one of those legendary investor to keeps active and monitoring the market. It will help to hear from him at least one every six months to listen to his take on current event. Thanks Real Vision!
  • DD
    Daniel D.
    16 February 2019 @ 01:31
    OK, firstly please enough of the personal petty comments. If the style of ones dress is that important perhaps one should be reading GQ Magazine (if it still exits). On to more substantive items. Populism is an emotion whereby Capitalism is an economic system. I know what Capitalism is, I can read about it, debate it, etc. With Populism I equate it with a "throw the Bums out" concept that is of course if I can't become one. The next question becomes, then what? Here's the thing, anyone who has risked a $1 of capital and has been fortunate enough to have two or more $ returned DESERVES, has the right, etc. to keep it proudly. What is lost on populists' is that $1 had to run the gauntlet of regulations, market forces, taxes, inflation, and on and on to become two or more $. I know the populists' think it was easy but, if so why aren't you doing it? If you believe the Government should take more of it in the form of higher taxes you must believe that they are awesome money managers and oh so efficient capital allocators. I mean every war, battle, government program is of course run with the highest efficiency and with such little waste that we should have more. A most simple plan and thus why it will never come to pass is: a Balanced Budget Amendment, Term limits (8 years), 25% tax rates for income, cap gains, etc. no deductions. No Estate Tax-Sorry death is bad enough! Nothing much to fight over, budget has to balance, argue over how but, you're in for only 8 years max so chop chop-it's not a career. WE CAN'T FUND EVERYTHING-CORRECT. Hard choices, sounds like real life. No time to hate each other-crap we have to work together and get things done. Wow, it's Friday night and this is what I'm thinking about-must be getting old! Grant and Howard got me thinking (which I think is the point).
    • SS
      Sean S.
      16 February 2019 @ 02:58
      Well said, Daniel!
    • DS
      David S.
      16 February 2019 @ 07:56
      Well said, but we cannot go straight to a system with consequences. The market is just as bad begging the fed to bail them out if them make any mistake. The baby boomers are as bad as the younger folks. They supported politicians that raped the SS accounts and did not put a stop to it. We are shocked that a trade war may lower worldwide economic growth. It is going to take leadership to get us started. Unfortunately, I think we will have to have a meltdown before leadership appears that can sell "no free lunch." I really like Mr. Marks' idea of supporting politicians that are not already polarized. Sorry I am negative, but I am not smart enough to see a way out. DLS
  • MF
    M F.
    16 February 2019 @ 07:44
    Excellent discourse....nothing better than seeing two smart men with both experience, insight and humility discuss various topics. Thank you RV
  • PU
    Peter U.
    15 February 2019 @ 10:56
    Lover Grant in all he does, but give him a budget for better clothes. He is interviewing one greats and his attire doesn't fit the gravitas of the interview! Love ya Grant (and Howard) but up your clothing allowance Grant!
    • PU
      Peter U.
      15 February 2019 @ 13:48
      Ok, I'll be more specific. I am not in agreement on his red socks. Rest is fine. Let it go
    • AP
      A P.
      15 February 2019 @ 17:01
      "When the sage points at the moon, the fool looks at the finger"
    • BM
      Bryan M.
      15 February 2019 @ 19:55
    • js
      john s.
      15 February 2019 @ 21:27
      Rumor has it, Grant had amazing cologne for a hedge.
    • JD
      Jeremy D.
      15 February 2019 @ 21:49
      With all due respect to both Grant and Howard, Gran't outfit is much more in tune with today's modern finance professional. Howard's suit is something I can pick up for $10 at a local thrift store and doesn't show that he has any style at all. Having said that, it doesn't matter whatsoever when it comes to his knowledge or my respect for his ideas.
    • DS
      David S.
      15 February 2019 @ 22:38
      Let Grant be Grant. This was a great interview. I like A.P.'s comment about the sage. I will have to remember that one. DLS
    • VK
      Viresh K.
      15 February 2019 @ 23:43
      Market doesn’t care about what socks you’re wearing
  • DS
    David S.
    15 February 2019 @ 21:39
    A great deal of income tax is already collected on SS payments every year. (If you only have SS income, you normally do not pay federal income tax on it. As your other taxable income goes up you pay more and more federal income taxes on SS payments.) As a simple option, Congress could have the increase income tax collected by taxing SS payments added to the SS fund. Not a perfect solution, but a simple and continuous mechanism. SS is not an entitlement for the employees who paid into the SS fund which were matched by employer contributions. Currently this additional revenue is simply part of the government tax revenue. It is possible in a perfect world for the government to reduce expenditures by the same amount funding SS each year. I will not hold my breath. DLS
  • WS
    William S.
    15 February 2019 @ 21:36
    Agree, a lot of history, behavioral etc. Nothing new. It is, however, instructive for one to hear the themes over and over because tendencies are to forget about history and those that have played it well, like Marks, who can remind us of the cycles of economics/markets ala Bridgewater et al. So, no lack of opinions or experience, just perhaps a lack of understanding of where we have been and where we are going.
  • DS
    David S.
    15 February 2019 @ 21:20
    One of the best interviews! I often watch while doing other things. In this case, I watched focus on the presentation only. The analogy of the football game and the side bets in the stands hit the mark for me. Political rhetoric focuses on capitalism vs. socialism. It is financial engineering that is giving capitalism a bad name. It is the corporate buybacks that executives use to radically increase their wealth. It is misuse of derivatives that make small bubbles into huge bubbles. It is central banks using QEs - financial engineering again - to bailout the system repeatedly. Instead of blaming capitalism, governments all over the world need to reasonably regulate financial engineering of the system. DLS
  • CS
    Christopher S.
    15 February 2019 @ 21:19
    I'd really like to hear some discussion on how to play the Universal Basic Income as an individual. It seems to me, that, like QE if you get on the right side of it's implications there's a ton of money to be made. Yet it's also a huge step towards outright socialism - leading to potential wealth confiscation. So does one bet on inflation? Quit working and hide your wealth, so you can take the money? Use the money to get into hard assets? Bet against the currencies of countries rolling it out? Leave the country for a more free market economy? Is it even certain to generate inflation? Will it be rolled back? Will capital flow into countries where it's not rolled out (in the UK we seem a little more distant from the idea)....everyone seems to think it's coming, I think we need to think seriously of the ramifications.
  • JG
    Jory G.
    15 February 2019 @ 21:17
    Very interesting discussion. It does seem to me however that compromise is why we have a 22 trillion dollar deficit in the US and continue to kick the can down the road. In addition, most states have so many gun laws that the police don't even know them all. Bad people don't obey gun laws, such laws only punish law abiding citizens.
  • SS
    Steven S.
    15 February 2019 @ 21:13
    It's time for a Swiss-like system in America -a BLOCKCHAIN DEMOCRACY. Build a wall? let the people decide let the people decide because the House & Senate don't speak for them and would rather shut the doors then loose their team tribalism.
  • KC
    Kenneth C.
    15 February 2019 @ 20:48
    Resentment is a companion emotion to jealousy and envy. It's the wrong word. Angered by the actions of the elite would be a better sentiment to describe how the populists feel towards the elite. There is a real disconnect between those who swim amongst the titans of industry and govt and the rest of the country. I particularly enjoyed his comment of "80% of the people want gun control laws" and immediately thought of the statistics where gun sales only recently tapered off after a 10 yr or greater run of YoY sales increases. I to read somewhere HC was a 96% shoe-in for the Presidency based on a survey or two. Sometimes we look for the facts/statistics that support what we want to believe. I will continue to enjoy Mr. Mark's ideas. He's still batting .990 with me so take that Ted Williams. He is one of the many patches in the quilt by which I form my own outlooks and I appreciate RV for his and all the other interviews they bring to us weekly.
  • SC
    Sau C.
    15 February 2019 @ 20:12
    Great interview with Howard Marks. Sounds like an intelligent and flexible investor. Felt like Grant attempted to press his perma-bear case on a few occasions only to be shot down by Marks.
  • VP
    Vincent P.
    15 February 2019 @ 19:51
    Unrevealing interview by any measure and almost cut it when Howard mentioned the Social Security issue. Really? Time to be defensive? Good or bad, Stanley set the bar as good.
    • AG
      Adam G.
      15 February 2019 @ 20:04
      Good TV, but no profits from this chit chat.
  • RF
    Ricardo F.
    15 February 2019 @ 16:23