Playing the Next Financial Revolution

Featuring Mark Yusko

Mark Yusko, CIO and managing director of Morgan Creek Capital Management, lays out some of the biggest global opportunities in the first episode of this new series, “Skin in the Game.” Yusko shares his thoughts on the economic landscape, updates his position on China, and explains how he is strategically making investments in the blockchain space. He also highlights some the opportunities he sees in Europe and Japan, in this interview with Justine Underhill. Filmed May 14, 2018 in Grand Cayman.

Published on
28 May, 2018
Topic
China, Global Outlook, US Dollar
Duration
32 minutes
Asset class
Equities, Currencies, Crypto-currencies
Rating
87

Comments

  • jh

    jim h.

    30 6 2018 20:33

    1       0

    Not a fan of MY. He comes across like a stockbroker in a bad 80’s movie: Absolutely sure that everything he touches is the best idea, ever.

    Just my personal taste, I’d prefer an investor who actually has some humility.

  • CL

    Chris L.

    25 6 2018 16:44

    0       0

    Bitcoin is now EDcoin

  • vp

    vasilis p.

    5 6 2018 18:22

    0       0

    softbank

  • TE

    Tim E.

    4 6 2018 07:15

    1       0

    One thing about Mark is he's never in doubt. Got to give him that. And some of his arguments make a lot of sense. Good to have a natural BULL on here once in a while.

  • AH

    Andreas H.

    3 6 2018 10:25

    0       6

    I have to say I share not much opinions of M.Y.:
    I am long dollar an US (much better demographics then china, creative (!) innovation)
    I am sceptical bitcoin and blockchain
    Fed did a good Job in the US in my opinion
    Europe is toast in my opinion
    China has big expropriation risks
    China or bitcoin or crypto will not provide the last resort in the fx market
    SP500 is not in bubble mode
    ICOs are almost all frauds and right now in a monster bubble (too early now!)
    as long security tokens are not regulated by the US they are not real assets, they are bits and bytes that will be stolen
    I would listen to Munger and Buffet more carefully, because they outperform(ed) 99% of all hedge Funds (including M.Y.)
    I agree: China will be a super power

  • cw

    cc w.

    1 6 2018 04:41

    1       3

    China can "control" its economic system through this command structure is only because it made money by reaping the benefit of the generous trade agreements setup by the previous US administrations. US had good intention wanting to bring China into the development world and hoped they will follow the rules like rest of other developed countries. China out-smart those previous administrations and out last them by playing hard ball and dangling carrots promising things and not delivering them. Yes Chinese stole, cheated, manipulated their way to current power the past 30+ years. When its easy to make money you don't have to be the smartest guy in the room to do well this is what the Chinese is experiencing right now.

    Now things are changing and the new administration and hopefully the Europeans will begin to realize the stupidity they've done in the past to fatten this competitor of theirs. Things will get harder for the Chinese and when SHTF we'll know how they good this "command" structure is.

    It amazes me that there are so many China lovers out there thinking the communist party in China is like the master of universe who can turn shit into gold. People forget how free they are in the US while thinking the pasture is greener on the other side of the Pacific. Try to live in China for a few years and loose your freedom and you'll know how it is. If US is so bad and the market system is so horrible then why are the Chinese millionaire migrating and sending their children over here in drove?

    When money is easy its hard to make mistakes. When time gets tough we'll know how good their system is made of.

    By the way--lets not forget about Japan in the 90s.

    • DR

      David R.

      7 6 2018 21:00

      0       0

      Let's not forget about China (and India) for the three thousand years prior to 1700..... number one in the world for 3000 years economically, scientifically and militarily (that includes besting the roman empire).

  • TS

    Tyler S.

    31 5 2018 16:19

    3       1

    good job, fun, informative, not to much bs

  • ST

    Sam T.

    30 5 2018 23:59

    3       0

    Please remove the 'Huawei Culture' chart.
    Huawei Culture is related to Huawei Technology as much as Cisco Systems is related to Sysco Foods.
    Maybe less focus on the background music and more focus on the charts and editing.

  • ML

    M L.

    30 5 2018 21:34

    5       0

    I liked this format. It worked well. Probably because interviewer and interviewee were strong. It's great that RV are mixing things up a bit. Great interview - well done!

  • BB

    Bill B.

    30 5 2018 19:54

    6       0

    I am not much into the comedy aspects of these shows, but this one had great content.

  • RA

    Richard A.

    30 5 2018 16:11

    27       5

    Please hear the pleas of RV founders - lose the fluff - keep the good content. You have a great guest, a good interview, marred by the unnecessary game fluff, and the Thomas Crowne Affair (good movie) wannabe music vibe, which ONLY comes across as more fluff, and something more akin to FOX or CNBC. Do you really want to be more like them?

  • RO

    Riskis O.

    30 5 2018 12:31

    4       0

    Huawei is not a listed company.... The price chart showed in the video - Huawei culture is not THE Huawei

  • PW

    Paul W.

    30 5 2018 01:30

    11       0

    I thought this video did a great job of demonstrating Justine's depth of knowledge in a way I hadn't appreciated before. Her work on trade ideas videos is typically structured and formulaic and it works in that context, but this video demonstrated an ability to ask relevant and insightful questions.
    I am not sure the interposed game really "worked" but I did not find it to be overtly distracting.
    Mark's view of the utility of blockchain was presented in a way I hadn't heard before and it helped me evolve my thinking a little. In particular, I think about the element of trust and I am trying to synthesize Yusko's view of blockchain with the work done by Bruce Schneier on how trust works in society.
    To the commenter below who mentioned the logical relationship between land titles and a State entity, that might be fine where it exists but in doing international real estate deals, I have found that much of the world's real estate does not have a chain of title. For example, in Puerto Rico, reconstruction has been delayed by a requirement that recipients of FEMA funds prove they own the property and typically those records, if they ever existed, are not available now. So, yes, sometimes a State entity can provide stability and trust and perhaps in those contexts, a blockchain title registry would have little value. However, there is a substantial portion of the world in which there is no effective title registry now and rather than implementing a paper-based system, leapfrogging to a digital solution seems like a practical and functional alternative. A database with an audit trail is not precisely an equivalent to a blockchain although i would be the first to admit that some proposed blockchain implementations are a step backwards in an attempt to disrupt a system that is working.

    • CM

      C M.

      31 5 2018 23:50

      3       0

      I like Mark, but don't follow his "internet of value" concept. He has recently jumped on the blockchain wagon (see his tweeter feed) but doesn't do a good job explaining the value that blockchain brings to a transaction. I have seen a number of transaction experts say that blockchain is not as efficient as current technologies in processing transactions and is actually slower and more expensive. Sometimes, I think a number of stock analysts embrace blockchain because they don't believe in bitcoin but don't want to look out-of-touch. So Mark thinks blockchain is going to change buildings and oil and gas reserves. Not following, other than to say that the paperwork can move digital, which it is already doing without blockchain. Then he dives into the currency argument, which really seems to be his basis for loving blockchain. His presentation reminds me of Buffett's presentation to the Allen retreat in 1999 when he shared stories about not making money at the start of the auto industry and the airline industry, two of the biggest inventions in the 20th century due to the number of start-ups and the number of failures around these new technologies. Got a feeling that block chain investing today will turn out the same way.

    • CM

      C M.

      31 5 2018 23:51

      0       0

      Wish we could edit these responses. Forgive my misspelling, twitter feed, not tweeter.

  • TA

    Trevor A.

    30 5 2018 01:30

    4       1

    Mark Yusko underperforms the market and his peers. No useful insights on blockchain or Bitcoin

  • SR

    Sylvain R.

    29 5 2018 23:24

    4       0

    This is _not_ what skin in the game stands for.

  • GF

    George F.

    29 5 2018 22:42

    4       0

    "So one party power, a command economy, can do things that other people can't do. "

    One reason to subscribe to alternative media is to get an interview like this. I do not think anyone on the mainstream media would say what this guy said.

  • ZH

    Zayd H.

    29 5 2018 22:36

    3       3

    Good interview. Connect Four game in between you two didn't work, though.

  • CH

    Craig H.

    29 5 2018 15:23

    4       2

    Mark is one of the most original thinkers in the investment world today, and his track record is stellar. I always love hearing his insights. Some of the negative comments here are way off base

    • DW

      Daniel W.

      29 5 2018 18:41

      12       1

      Really? I would be very keen to learn more about his track record, where can I find information on this? His track record on RVTV is not so stellar.

  • AF

    Andrew F.

    29 5 2018 13:03

    4       2

    Loved it. Great format presentation and fun to watch and learn.

  • NR

    Nuno R.

    29 5 2018 10:21

    7       1

    Don't understand any negative comments about this video, great format, fresh, innovative, Mark throws a few good ideas out there, he is simply great. Well done RVT.

  • CR

    Cristian R.

    29 5 2018 07:53

    3       0

    China has far worse demographics than the US.

  • PS

    Paul S.

    29 5 2018 01:29

    4       2

    Seriously this guy is now pitching ICO, 100% open about regulatory arbitrage - skirting Chinese capital controls to flog NYC real estate - classy

    • KA

      Kristian A.

      29 5 2018 04:25

      5       0

      Agree... so classy they might want to drag out Harry Dent next

  • FH

    Frank H.

    29 5 2018 00:23

    2       2

    Starting to think 180 was too much.

  • RK

    Robert K.

    28 5 2018 23:48

    6       1

    A big dose a wishful thinking.

    • RK

      Robert K.

      29 5 2018 11:11

      0       0

      To avoid misunderstanding I consider the interview as good quality and fun - no problem with that! It is the book of Mark I am worried about ;)

  • LN

    Lucy N.

    28 5 2018 23:46

    1       0

    Really

  • NH

    Neil H.

    28 5 2018 23:21

    11       7

    Very poor video with no real substance

  • MK

    Michael K.

    28 5 2018 21:44

    11       2

    Love RV but this has very little substance. This interviewer across her hosting this and trade ideas keeps using the term “play” as in how do you play this theme. For those who work in the investing field and who manage substantial portfolios should wince at the term “play.” Not to say randomness chance whimsy and luck don’t play a part in outcomes. But we should approach this field with respect.

    • MK

      Michael K.

      29 5 2018 00:09

      5       1

      I’d like to fade my comment a little. I think this is a solid interview and Mark is a good presenter. I prefer a more dry and unedited format, but I understand why RV does the slick thing. Just don’t lose the heart of long form interviews and shorter pieces where people lay out their view on the line.

  • HJ

    Harry J.

    28 5 2018 19:38

    12       2

    Do you wonder if he really believes what he’s saying?
    Someone Knowing the future, is unlikely for a month, how-then is knowing years or decades ahead remotely reasonable? Unless we’re talking about the position of planets!

  • FH

    Franz-Xaver H.

    28 5 2018 19:21

    18       3

    Confusing, cloudy and erratic, not convincing at all. Also I have to say I see no value in today's crypto space.

  • SJ

    Sy J.

    28 5 2018 19:17

    0       0

    What is the name of the game?

    • CM

      Carl M.

      29 5 2018 03:00

      1       0

      Keep your eye on the ball !!
      I get the criticism. I would however recommend folks go back and rewatch and or listen to M.Yusko's other segments here at R.V.
      You will appreciate this "lite" segment in context with his macro themes.

  • WH

    W H.

    28 5 2018 18:54

    21       2

    Compared to some other recent interviews this was pretty fluffy. He seems to be a better storyteller than analyst. Some interesting themes, but the treatment was somewhat superficial.

    • AG

      Asim G.

      29 5 2018 19:36

      3       0

      Agree. Mark Y. is mainly a sales/marketing guy -- he's not known for being a great investor. Morgan Creek is an RIA (read: heavy on the marketing).

  • MA

    Michael A.

    28 5 2018 18:42

    6       0

    Funny how Mark dodged the questions specifically about what cryptos and tokens he is invested in. Very helpful interview nonetheless.

    • BC

      Burton C.

      28 5 2018 23:44

      3       1

      The whole crypto discussion really eludes me. My chart work points to bitcoin going much lower. I must ask what does one own with bitcoin if the power plug gets pulled? Currency? It is not a currency as long as each transaction is taxed, which it is. Store of value? Seriously? There is no intrinsic value. It's main function IMO is to transfer value across borders outside the banking system, yet it is not doing this with EM currencies failing presently. I am not convinced by Mark's argument, trying to be open minded though.

    • MM

      Mak M.

      30 5 2018 18:43

      3       0

      Dear Burton C.,
      please come leave in my country for 1 year and you will see why bitcoin has value.

  • BJ

    Brendan J.

    28 5 2018 17:45

    0       0

    Does anyone know the company bought by Google mentioned around the 19min mark?
    Sounds like Kasend?

    • AG

      Adrian G.

      28 5 2018 22:15

      2       0

      You can download a video transcript and catch it. It's Casend.

  • DT

    Douglas T.

    28 5 2018 17:01

    27       5

    One thing I find curious is that we all KNOW China is a colonial empire masquerading as communist country masquerading as a capitalist economy. We also all KNOW central planning always fails. So I'm always shocked when financial guys and gals think China is way out in front because the have 30 year plans! Really? I have a hard enough time planning next week.
    The whole philosophical point being that the correct way to manage complex systems is evolve along with them, to adapt continuously as new (unpredicable) trends take hold. In other words, you can't manage complex systems, you can only adapt to them.
    We see this in the totality of life on earth, the biosphere. There is no plan, no manager, no living being knows what's going on, they just evovle. And yet the biosphere has trived over billions of years, surviving countless horrendous catastrophes. This is the paradigm for free-markets and free societies: they are the only systems that can ever work. You'd think we'd have learned by now that the humans that want to run things, shouldn't be allowed anywhere near power.
    Yes, I'm talking to you, ruler for life Xi. China has thrived by exploiting a bottomless pit of cheap labor, and stealing every idea and process they can. But they are mired in a hopelessly obsolete Marxist group think. WIth the party leaders all being billionaires, do you really think they place the countries needs first? Not a chance. Eventually the simplistic ideas behind China's amazing growth will fail, along with their leadership. Perhaps then the last colonial empire will fall apart just like all the others have.

    • SH

      Steve H.

      28 5 2018 18:46

      12       5

      Interesting perspective. However:

      1. You assume that because not everything can be planned, nothing can be planned. Not true.

      2. We do not in fact know that central planning always fails. It often fails - as does free market capitalism - but it has done China quite a lot of good since 1978.

      3. Whilst a belief in 'free markets and free societies' being representative of 'the only systems that can ever work' is uplifting, there are precious few truly free markets and societies from which to deduce this generalisation. Certainly, countries such as the UK and the US with their centrally planned monetary systems and their socially corrosive political correctness cannot be held up as paradigms of market and social freedom. Much freer than China in many respects, it is true, but just as 'managed' in other respects.

      4. Notwithstanding the situation Tibetans, Uighurs, and other minorities find themselves in within China, it is not China that has active duty military personnel stationed in over 150 territories, and more than 800 permanent bases in over 70 countries. I think the US wins gold in the title race for the 'last colonial empire'. Assuming it is the last, of course.

      Great interview, by the way.

    • RM

      Ronnie M.

      28 5 2018 20:14

      8       3

      Over the medium term, China is going to rock our world. Not only do they have great leadership, but also their nation is hungry. Have you seen a train station go up over night with 10,000 workers on it? They move hundreds of millions of people over half a decade. Their investment in technology is starting to rival ours. With our political system, we can’t seem to get anything done, other than legalizing marijuana which just makes us even slower and fatter.

    • CM

      Carl M.

      29 5 2018 03:30

      1       0

      To borrow an idea from M.Yusko, we (the west) are asking about how to play "Connect-4" while the Chinese have been playing the three dimentional chess game that Mr. Spock played on Star Trek.

  • TY

    Thomas Y.

    28 5 2018 16:35

    5       0

    Great interview. I've noticed that many of the daily trade ideas are a bit "fluffy". Many are consensus themes (such as shorting REITs due to rising interest rates). However, this interview touched upon many thoughtful topics. Great job.

  • AP

    Andy P.

    28 5 2018 16:24

    5       8

    Great interview...more like this please.

    I like the game transitions. Better than title/music.

  • BS

    Bill S.

    28 5 2018 15:54

    2       4

    In one interview payback on TV
    subscription! Great content well
    done.

  • PB

    Pieter B.

    28 5 2018 15:11

    2       4

    This was awesome! Great interview! Thanks a lot.

  • PG

    Paco G.

    28 5 2018 14:21

    2       0

    Fascinating discussion on cryptos. The “transfer of value over the Internet” is a term I first heard on RV in an interview with Trace Mayer. Once you grasp this concept, you really start to think about the implications for this market disruptive technology which is still it’s infancy stages. As a boomer, who is fascinated by the complexity of the subject & it’s implicationsI, I would like to hear more on the subject of merging the crypto space with the legacy world of fiat.

    • MS

      Michael S.

      28 5 2018 18:40

      5       2

      I get blockchain as an auditing mechanism for digital collectables, but I would welcome an explanation of what it brings to the real - and even financial - world.
      The raison d'être for crypyo and blockchain is the lack of a central trusted authority, but isn't that a bad thing?
      Example1: When transacting real estate then isn't the state government a party that it is natural, and even necessary, to trust? Their records are the gold standard for the ownership of real estate.
      Example 2: If buying a financial product like a stock, bond, or annuity then doesn't one still have to trust the issuer of the security to be honest and capable, in which case what significant benefit does a distributed block-chain provide?
      Furthermore databases have had audit trails for half a century in the form of transaction log files, so that is not novel.
      I also suggest that every system relies on trust when one looks closely.

      This whole thing evokes memories of pet rocks and hula-hoops.

    • MS

      Michael S.

      28 5 2018 18:40

      0       0

      I get blockchain as an auditing mechanism for digital collectables, but I would welcome an explanation of what it brings to the real - and even financial - world.
      The raison d'être for crypyo and blockchain is the lack of a central trusted authority, but isn't that a bad thing?
      Example1: When transacting real estate then isn't the state government a party that it is natural, and even necessary, to trust? Their records are the gold standard for the ownership of real estate.
      Example 2: If buying a financial product like a stock, bond, or annuity then doesn't one still have to trust the issuer of the security to be honest and capable, in which case what significant benefit does a distributed block-chain provide?
      Furthermore databases have had audit trails for half a century in the form of transaction log files, so that is not novel.
      I also suggest that every system relies on trust when one looks closely.

      This whole thing evokes memories of pet rocks and hula-hoops.

    • JF

      Joanne F.

      29 5 2018 17:57

      0       0

      Cryptos may be in our future more, but can you picture an auditor from the IRS trying to decide if you owe more taxes when you assets are shown in cryptos? I can't. It would be like the SEC trying to figure out Bernie.

  • NJ

    Namit J.

    28 5 2018 13:52

    44       6

    From a style-factor perspective, does anyone think the game part was unnecessary and perhaps a distraction?

    • KJ

      Kulbir J.

      28 5 2018 14:30

      31       3

      It was ridiculous

    • BC

      Burton C.

      28 5 2018 23:09

      4       0

      It was a somewhat cute attempt to be edgy, however I do have to say it turned out as a distraction.

    • AM

      Artur M.

      29 5 2018 07:22

      3       1

      It was fun with the game and matched the titel of the series and book from Talebs "skin in the game". This is not in depth interview, but a shorter kind of update version. If you would like in depth, there are older once.
      I like Mike Yusko, he convinced me to stay in btc by sharing some graths on twitter when btc was at 2000 and Raul sold all his coins.

  • CA

    Courage A.

    28 5 2018 10:29

    1       0

    what game is that ?

    • CO

      Connor O.

      28 5 2018 11:25

      1       0

      Connect Four

    • JB

      Jonathon B.

      28 5 2018 11:52

      0       0

      Connect four

  • FG

    Fred G.

    28 5 2018 10:16

    5       0

    Great to hear Mark's thoughts as always. A little unsure of the direction of this series. It is unclear whether this is a quick update on his views/positions from a trading perspective or a more in depth discussion. At times he started to talk about some very interesting themes that were not discussed further or teased out.