The Dollar Milkshake Theory

Published on
June 6th, 2018
Duration
34 minutes

The Dollar Milkshake Theory

The Expert View ·
Featuring Brent Johnson

Published on: June 6th, 2018 • Duration: 34 minutes

Santiago Capital CEO Brent Johnson rejoins Real Vision with a plethora of predictions that revolve around a strengthening dollar. Johnson believes that a global currency crisis looms, but that there is a bull case to be made for the greenback, gold and U.S. equities. Filmed on May 29, 2018 in San Francisco.

Comments

  • CM
    Chris M.
    28 October 2018 @ 01:31
    I find it interesting that the flight to safety hasn’t been very clear. Very transitory IMO. Yen, Bonds, Gold, Silver, No BTC tho, sorry crypto guys and gals. I’ve made some trades against the Aussie dollar, rode the Yen up, used gold as a vehicle to trade long and reverse, and lastly I hit the jackpot on the crude decimation of $4 down in one session. I cannot for the life of me understand why the banks are on life support. But my next short that I’ll be in longer term are the REITS. THANKS AGAIN for the video. This is great stuff right here
  • JC
    Joe C.
    21 August 2018 @ 22:44
    Still one of the best Real Vision videos of all time.
  • PM
    Paul M.
    1 August 2018 @ 11:42
    Clearly an interesting view on things but: 1. The argument for $1-2 trln. global demand for USD to pay interest is flawed since a lot of these issuers are actually getting paid in dollars for their goods. Like, every non-US exporter out there for instance. There is some demand obviously but it's not $1-2 trln. per year. 2. Repatriation argument is also overstated. US corporates don't hold most of their cash offshore in other currencies primarily for two reasons: no yield in fixed income instruments/deposits and clear lack of instruments (about 80% of Fixed Income market is in $). They will move their cash for tax reasons but they don't need to buy $ on the scale Brent is talking about. 3. Yield differential (carry) is actually the best reason for dollar strength but the carry difference is not that large, effectively the differential is within annual vol range of Eur/Usd for example. By going into dollars, an investor with a base in anything but dollars is actually taking additional FX risk and it's a big leap for a differential of 2,5-3%.
  • RP
    Ryan P.
    26 July 2018 @ 00:58
    Save in gold, spend in $
  • ph
    peter h.
    19 July 2018 @ 12:53
    Spot on thus far with the theory. USD continues to be on a roll. Up over 8% since the lows. Let the chaos being!
  • MD
    Marc D.
    19 July 2018 @ 09:16
    Great video. I understand that USD strength can be predicated on tighter USD liquidity from FED tightening and lowering their balance sheet. Just wondering whether some other factors might not mitigate this “tighter USD liquidity”? 1) For instance it may be that the USD money supply goes down from a lower FED balance sheet and fiscal deficits in the US. But what about the velocity of money? Might that not increase if banks (especially in the eurodollar markets) have gone through balance sheet repair and become ever more willing to “circulate” USD? (Banks are earning good profits again and may have room to releverage) 1a) Not only commercial banks, but other central banks might facilitate USD funds. BOJ and Bank of China have massive holdings of treasuries. E.g. BOJ has facilitated USD funding to Japanese banks and investors by lending treasuries against JGBs to Japanese banks (that they in turn can repo) to provide USD funding. 2) If USD starts to strengthen due to liquidity issues, would the FED not react by supplying USD using its swap facility with other central banks (or more precisely foreign central banks request activating fx swaps)? Or perhaps even pause or delay its rate tightening? 3) The FED has been tightening for a while now and the market is starting to look for where fed funds might top out, (hence a very flat yield curve) while e.g ECB is expected to begin sometime next year. Could that not cause interest rate differentials to narrow over time and thus cause the USD to become less expensive vs the EUR? I think your analysis is brilliant and agree with a lot of your expectations. I am just not sure the USD would necessarily go through the roof without having some type of central bank reaction to mitigate some of this. Thank you.
  • RD
    Ryan D.
    27 June 2018 @ 23:27
    I think what Mr Johnson is trying to say is that the US $ Milkshake brings the EM boys to the yard, and they're like it's better than yours, Trump could teach you, but he'd have to charge. Sorry. Couldn't resist.
  • RC
    Richard C.
    26 June 2018 @ 22:20
    Thought provoking commentary. Brent may well be right about the direction and strength of direction of USD, but I suspect that many in the rest of the world will react long before the pain point that Brent thinks it will get to. This reaction will cause pain of its own for those reacting, but whatever moves are made (or is made if there is a concerted response) it will no doubt cause pain for the US , may indeed be intended to cause pain for the US in retaliation. If you believe the world is transactional alone then you have to expect negative feedback for negative stimuli. And at some point when people are pissed off enough they will shoot themselves in the foot if the shot wounds their nemesis at least as badly. Bad leadership is begetting bad outcomes.
  • cd
    chris d.
    23 June 2018 @ 14:14
    I’m surprised you did not weave in how the emerging trade war will impact this scenario
  • CM
    Chris M.
    15 June 2018 @ 11:40
    So. When you say that gold and the USD will rise simultaneously, is it safe then to say that the “value” of gold will rise, but not necessarily the price (in USD). The rise of gold will be from other currencies collapsing. Thusly, since the USD and gold will rise in value simultaneously the price point should be the same? I don’t get how our broader market will rise if, the above happens. Liquidity and CBS I get but the corresponding hyperinflation would price EM out of the market. No? Lastly, ECB just came out and said they were gonna start tightening (before y’all filmed this) so “we” will no longer be the only ones creating the money velocity and providing liquidity, does that change your thesis at all? Thanks for your time I really enjoyed it, but as a parent didn’t finish it completely, fell asleep watching it in my lap lol.... Chris
  • HC
    HJ C.
    14 June 2018 @ 20:53
    Great presentation of position and support, really appreciate the openness on the gold issue/last 5 years. Highly valuable to be able to hear alternate perspectives. The equity presentation rings true.
  • PD
    Pat D.
    13 June 2018 @ 10:34
    Impressed to see a presenter respond and interact with so many of the comments ....... and humbly.
  • DS
    David S.
    13 June 2018 @ 02:54
    The FX market will continue to float on a moment by moment basis as will as all hard assets. We cannot put the FX genie back into the bottle, but we can own some precious metals as a hedge for now and as an investment over time. It is a reasonable bet. DLS
  • CZ
    Cyprian Z.
    13 June 2018 @ 01:49
    Great video. Controversial. Thought provoking. Precisely what I signed up for when I subscribed to RV. Less knock on effects, and more milkshakes please.
  • DS
    David S.
    12 June 2018 @ 21:32
    Mr. Johnson. Thanks for another interesting discussion. Fiat money/gold/beads/sea shells are used in bartering, therefore all are money. Some traders suggest 5-25% of your assets should be in gold. It would be interesting to hear a short discussion on the percentage of gold one should have from just starting out - low disposable income and needing shelter, food and clothing - to retirement. Do you know of any papers or website that objectively discuss this? DLS
  • WG
    Wade G.
    12 June 2018 @ 18:24
    That's a lot to chew on; thank you for a cogent presentation of a really interesting thesis. Curious if there's some nuance regarding foreign investment in U.S. markets under this theme: what portion of such total investments might be currency hedged, and should that portion be viewed as dollar neutral or is it not that simple. Also curious if you have a technical or other view on how much gold might correct on a shorter term basis until it might break the inverse correlation and trade with a strengthening dollar. Again, thanks for sharing a really interesting view; really well presented.
  • LA
    Linda A.
    12 June 2018 @ 17:33
    Hey Brent- u may be right on the button. Tudor Jones just said that the "3rd & 4th qtrs. are going to be phenomenal" Brent, u are the bomb -so kind of u to thank viewers and reply back. Much respect to u!
  • FK
    Firoze K.
    12 June 2018 @ 14:50
    Really enjoyed this video, hearing a lot to the contrary so it's great to listen to another point of view.
  • zy
    zhang y.
    11 June 2018 @ 21:46
    One question Brent Johnson, I don't understand that of if debt is defaulted money disapper, the money that was granted as debt has already disapeared in whatever the borrower spend it, so what does it mean that money disapear?
    • DS
      David S.
      13 June 2018 @ 02:37
      The default makes the risk of new loans much higher. It may be better to make loans elsewhere rather than taking the higher risk. If you are willing to take the risk, the interest demanded may be too high for the borrower. In either case additional funding can dry up. DLS
    • MB
      Michael B.
      17 February 2019 @ 00:53
      With a fractional reserve banking system like we have in the world, money is “created” when a loan is made. The money you think you have in your checking account has already been lent out and someone’s out there blowing your money, yet it’s still (at least on paper) in your checking account. There are two avenues to “destroy” this money: 1-the loan is repaid to the bank, in which case the borrower no longer has it OR 2-the loan is defaulted on, in which case the bank will never get it back (and will now have to scramble to find more dollars to back up your checking account). While both scenarios shrink the supply of money, the second one tends to discourage future money creation.
  • DK
    Daniel K.
    11 June 2018 @ 02:08
    Hey RealVision guys and gals. Can one of the presenters bring on a guest to discuss Greece? After six years of recession and 28% reduction in public spending, the GDP growth rate is 2.3%, highest in ten years. Unemployment is falling in every age category and is now at 6 1/2 year lows (still highest in Eurozone at 20.1%). The Manufacturing PMI has been rising, May was 54.2. After bottoming out in 2014 and basing for several years, are there any sectors in the Greek economy worthy of a discussion? I already own silver.
  • CR
    Chris R.
    11 June 2018 @ 00:46
    Is there not precedent for this type of activity--did not the call market of the late 1920's suck capital into New York in similar fashion contributing to the melt up in before the crash? Given current rate differentials and especially if US rates continue to rise, it seems plausible...
    • BJ
      Brent J. | Contributor
      11 June 2018 @ 18:30
      Hi Chris. yes, same thing happened in late 1920s. Yield curve also inverted from 1927-1930. Treasury prices fell 30% and the stock market doubled during the inversion. THx for watching. Brent
  • AV
    Alberto V.
    10 June 2018 @ 23:17
    Just a thought, and perhaps someone else agrees with me: it would be awesomely nice to have a button to sort comments by most recommended/discussed vs chronological order. This should also prove to be 2x more useful for mobile (outside app) viewers too. Thanks for the video btw, great one!
  • JC
    John C.
    10 June 2018 @ 20:51
    Brent, First thank you for the presentation. I do agree with the base premise of the idea. However, I am concerned that I did not hear in you thesis any substantial consideration regarding changes in U.S. fical policy (I.e. deficit spending/with no ceiling. In particular, I am worried that regardless of what the Fed is pulling out of the IMO through the straw; that the US Treasury is putting back into the IMO enough dollars offset the Fed’s action. Thank you regardless. Very persuasive argument.
    • BJ
      Brent J. | Contributor
      11 June 2018 @ 18:28
      Hi John. Thx for comments. Long Term the US deficit are a real problem. I just think in the short term it has the exact opposite effect...regardless of the long term detriment this poses to the dollar. Thanks again. Brent
  • CS
    Christopher S.
    10 June 2018 @ 20:25
    I've had a hunch in my thinking that about this scenario playing out for several years now, but I haven't been able to articulate it as well as this. Whenever I'm asked "where should I put my money" I've basically replied something along the lines of 40% USDs, 40% US Equities, and 20% Gold." (With maybe a bit more diversification thrown in as well). Higher equities on a higher dollar and higher rates is a contrarian position. Everyone and their dog currently thinks rates go higher and that crushes equities, which causes the fed to unleash more QE...this is another reason why I feel more comfortable with this thesis. What's more, go on any message board, social media, ask your friends and neighbors...how many of them feel confident owning equities?? I'm betting its not too many.
    • BJ
      Brent J. | Contributor
      11 June 2018 @ 18:27
      Thanks for watching...Brent
    • JK
      Jon K.
      18 June 2018 @ 00:00
      Full disclosure...I don't know what I'm talking about. :) In certain cases isn't owning Treasuries like having USD, such as in the case of say...Sovereigns (i.e. China)? So with the rise in dollar demand, wouldn't we see a rise in Treasury demand, in addition to the attractiveness of higher yields? Also, if "retail" doesn't own equities right now, who does? Social media is polarized, and there is a good chance so are your neighbors based on your likely income/social class, etc. I'd argue that most retail is buying the narrative and thinks now is a good time to buy risk assets. The herd is racing to the slaughter house, just like they did with Bitcoin. The same seems to be true of real estate; the number of Gen X'ers I see buying houses now makes me laugh. What, the low price and low rates of 2011 wasn't good enough for you? You wanted to wait to new all-time high in home prices and a 7-year high in interest rates...good call.
  • DW
    Dave W.
    10 June 2018 @ 16:27
    Hi Brent, great exposition of your theory, thanks. Given you expect equities to do well as world liquidity flows into USDs, does that include precious metal miners in USD terms? Or do they languish until gold breaks out?
    • sB
      sylvain B.
      11 June 2018 @ 07:02
      it is hard to see world liquidity flowing into the USD as international investors are already extrmely long USD. outside of US, Japan is the largest holders of USD assets. their holding is at record high of 225b. rest of the world is also very long US assets. i'm not buying his thesis of large inflows as i think it has alreayd happened
    • BJ
      Brent J. | Contributor
      11 June 2018 @ 18:26
      Hi Dave. I do not currently own any of the miners and don't plan to until lower levels or until gold breaks out (I reserve the right to change my mind at any time). That said, I have no problem with those that have a long time horizon doing so. Long term i think they will do extremely well.
  • CL
    Chewy L.
    10 June 2018 @ 15:55
    The more he says he is wrong and got things wrong in the past the more I like him and gives me more confidence about his convictions going forward. It’s hard to teach humility. Great job Brent
    • BJ
      Brent J. | Contributor
      11 June 2018 @ 18:25
      THanks. Brent
  • RX
    Robert X.
    10 June 2018 @ 13:09
    One of my favorite Real Vision presentations ever. As a equities PM, I am appreciative of a simple but elegant thesis with respect to the dollar and its knock on effects. U.S. equities, are certainly acting like his king dollar, inverted yield curve theory are going to come to pass.
    • BJ
      Brent J. | Contributor
      11 June 2018 @ 18:24
      Thanks Robert. Brent
  • PP
    Patrick P.
    9 June 2018 @ 16:28
    Kudos to Brent !! ..... He read every comment ..(IMO unlike most other presenters) ...Brent also took the time to comment on most of them. That tells me that Brent is interested in hearing all points of view ........that is a sign of an intelligent presenter.
    • BJ
      Brent J. | Contributor
      11 June 2018 @ 18:24
      Thanks Patrick. Always keep an open mind! Brent
  • RD
    Ravi D.
    9 June 2018 @ 11:04
    Hi Brent, interesting view - i like unconventional ideas. Something I try and promote in my team because the fact is, everything I was taught during at university in Economics has been thrown out the window since QE came into effect. My question is - if $ is set to rise and cause chaos around the world and with China one of the largest $ debt holders decides to start reducing its holdings - how will this impact the $ milkshake theory?
    • BJ
      Brent J. | Contributor
      11 June 2018 @ 18:23
      Even if some decide to sell their treasuries (which will no doubt happen) I think there is more than enough demand to mop it up (albeit at higher levels). But remember many of these debt holders also have dollar based debts. IMO they can't totally abandon dollar holdings until they have paid off said debt. Thanks for watching. Brent
  • BJ
    Brent J. | Contributor
    8 June 2018 @ 20:58
    Just wanted to say thanks to everyone who has watched and considered my thesis. Whether you agree or disagree I hope you found it thought provoking and encouraged you to keep an open mind. Best of luck to all. Brent Johnson
    • PD
      Peter D.
      8 June 2018 @ 23:56
      Great work Brent. Love your out of the box ideas....and especially the "Step into the Liquid" piece which was a masterpiece of economics, metaphor and storytelling. You are also a particularly good interviewer. I am thinking about the Schiff piece which I thought you did exceptionally well. The interviewer is often just as important as the interviewee in this field. If RV asks you to conduct more I'd hope you are willing you kick in the time.
    • BJ
      Brent J. | Contributor
      11 June 2018 @ 18:21
      Thanks Peter. I love realvision and serve at the pleasure of Grant & Raoul!
  • CC
    Carlos C.
    8 June 2018 @ 19:41
    This is a brilliant analysis. Very clearly explained. I never put too much weight into any macro analysis as it is fundamentally hard to predict. But the other thing a bullish dollar thesis has in it's favor is sentiment. Maybe it's time to lighten up on gold/silver specs!
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:54
      Hi Carlos - Thanks for watching...Brent
    • CB
      C B.
      8 June 2018 @ 23:42
      I will never lighten up! Maybe just rebal back to target allocation
  • IL
    Ian L.
    8 June 2018 @ 13:54
    Buy equities one of the highest valuations ever recorded because some guy has a hunch the dollar is going higher. Good luck with that one.
    • RJ
      Russ J.
      8 June 2018 @ 16:32
      Good point! I am bullish on USA Technology. My my thesis has nothing to do with a milkshake. I traded the dot.com bubble and this technology bull is no bubble .... yet.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:53
      Hi Ian - Not saying buy based on valuations...and not saying that its right...just saying what I think it going to happen...whether its for the right reasons or for the wrong reasons. Thanks for watching. Brent
  • GO
    Glenn O.
    8 June 2018 @ 06:03
    Very well thought out and well presented. For someone not living in the USA my gold has done its job and protected my purchasing power.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:52
      Hi Glenn...thx for watching. Brent
  • AH
    Andreas H.
    8 June 2018 @ 05:52
    I am long dollar :-)
  • DG
    David G.
    8 June 2018 @ 05:25
    RV is the courtroom. The direction of the dollar is on trial. The RV subscribers are the jury. Expert witnesses have given testimony and the best lawyers have vigorously argued their case. Evidence has been presented and we've heard the closing arguments. The jury deliberates in comments section and it appears they are hung. Judge declares a mistrial. The dollar goes free ... for now. We have no verdict on the direction of the dollar but we are unanimous in a agreement on one point: Gold is money and the dollar is a fraud. Eventually it will get what it deserves and reach its intrinsic value of zero.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:52
      Gold is money...Amen. Brent
    • RJ
      Russ J.
      8 June 2018 @ 20:56
      I was a big buyer of gold at $300-400 per oz. In my opinion gold needs to drop the first number (1). I’ve been hearing gold $5,0000 gold $10,000 since 1988. Just can’t see the London banks who set the daily gold spot price let gold $5,000.00 happen. Maybe The China gold exchange will be the catalyst?
  • DR
    David R.
    7 June 2018 @ 21:59
    So many dollar bulls. Recently 97% per the DSI sentiment survey. Like Jan 1, 2017 before the dollar collapsed 23% within 12 months. Maybe bet the other way.
    • RJ
      Russ J.
      7 June 2018 @ 23:43
      Good to know... thanks!
  • BH
    Brian H.
    7 June 2018 @ 19:54
    Stepping out of the office and going to go get a milkshake.
    • RJ
      Russ J.
      8 June 2018 @ 16:27
      Doug Heffernan did the same, lol.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:51
      LOL...whats better than a milkshake? Thx. Brent
  • RJ
    Russ J.
    7 June 2018 @ 18:54
    The daily spot price of gold and silver is set by five London banks. It’s referred to as the London gold fix. Bankers traffic in paper currency gold:silver (at this time) contrary to banks interest. Gresham’s law in play ,we hoard good money..... as bankers set prices. RJ Sarasota, FL
    • DS
      David S.
      7 June 2018 @ 21:50
      Thanks for referencing Gresham's Law. I looked it up and references go all the way back to Aristophanes in his play The Frogs 405 BC. Guess there is not much new under the sun. DLS
    • CB
      C B.
      8 June 2018 @ 23:46
      I suppose if they could print physical gold, this really could go on forever. However, if they can not maybe the unsustainable will not be sustained.
  • RK
    Robert K.
    7 June 2018 @ 16:38
    Scary but in a nice way ;) Well done - do more like this!
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:50
      Thx Robert. Brent
  • TC
    Timothy C.
    7 June 2018 @ 16:37
    Wouldn't a very strong dollar drive higher imports thus benefiting the countries that export to the US? I understand a strong dollar might mitigate the benefit of those returns for US investors. I am not sure if he is saying do not invest outside the US if you are a US investor or just focus more on US assets. This is also a very out of consensus view, which I love, but just being out of consensus does not mean you are correct.
    • TC
      Timothy C.
      7 June 2018 @ 18:37
      Also, wouldn't a stronger dollar put a lid on inflation? If that is the case wouldn't the Fed consider halting rate hikes? Strong dollar would lead to higher inflation outside the US, the Fed stops raising rates, central banks outside the US start raising rates to fight inflation, the rate differential flattens out and perhaps there are a few more straws in the "milkshake". Not that I believe all of that, just spit-balling a counter argument for discussion purposes.
    • SP
      Steve P.
      8 June 2018 @ 07:02
      ......in other words markets working as they should. But that's the problem! Central Banks have basically removed the signal that drives the economic machine - price discovery. Sad eventually for all of us !!!
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:50
      Hi guys...thx for watching and for the comments. without knowing your individual situations...I'm not recommending you do anything. I'm just saying I think US markets are heading higher. Its a very dynamic thing. It won't all happen in a linear fashion and there will no doubt be starts and stops. But IMO the overriding trend will be higher rates...higher rates abroad due to counter party issues and higher rates domestic US to counter the inflationary impact of capital flows into US markets. Thx again. Brent
    • CB
      C B.
      8 June 2018 @ 23:50
      If the US attracts capital and the dollar strengthens, it seems as though bond prices would be higher, not lower. More bids on bonds and diminished inflation expectations push rates down.
  • SS
    Sam S.
    7 June 2018 @ 14:38
    Hey Brent, everyone gets the timing wrong as some point or another. So no worries and you admitting it does in fact set us free. I don't see Gold as a currency but more as an asset. Same with Bitcoin. If Gold holds up in value when things "end badly", I see it as selling the Gold for US dollars and buying all the distressed assets at the bottom, therefore profiting from the Gold asset spread. I hope I'm thinking of this right. Well done presentation.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:46
      Hi Sam...thx for watching and for the nice comments. Brent
  • GT
    Gerardo T.
    7 June 2018 @ 14:05
    I thought QT was removing liquidity from US/DM and moving capital flows to Asia. Which is right?
    • DW
      Doug W.
      7 June 2018 @ 22:27
      QT wii increase money velocity, more inflation.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:45
      Hi guys...thx for comments. QT does remove liquidity (supply) which is why I think dollar will go higher. And as people chase the liquidity, I agree the velocity will pick up. Thx again. Brent
  • GS
    Geoff S.
    7 June 2018 @ 13:17
    Thought provoking. I would add that a protectionist trade policy in the US would add fuel to this fire by further increasing the USD supply/demand imbalance.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:44
      Hi Geoff - Very good point. That is definitely a factor in the strong dollar thesis. Thanks. Brent
  • SM
    Stephane M.
    7 June 2018 @ 12:44
    Seems like Brent met with Martin Armstrong... Strong U.S.$ into 2020-21, rates going up, stock market going higher. Maybe RV should invite the real guy behind these predictions, not a repentant gold bug (just like me by the way!!).
    • SS
      Sam S.
      7 June 2018 @ 14:33
      I thought the same thing SM while watching this presentation. Thumbs up.
    • TS
      Timothy S.
      7 June 2018 @ 17:26
      I agree, Brent's pitch is right out of Martin Armstrong's playbook. While Armstrong can lend valuable insight, he is not very articulate and requires a skilled interviewer who knows the broad outlines of Martin's work and can keep focus. I hope RV brings Armstrong back for another interview with Brent as the interviewer.
    • BM
      Bryan M.
      7 June 2018 @ 20:27
      Now now...be careful of comparing Brent to Marty. Marty, I think, lives by the Predictor's credo, which is to say: "if one must predict, one should also predict often".
    • PD
      Peter D.
      7 June 2018 @ 23:11
      Funny I though exactly like you and actually watched Martin Armstrong's clip here on RV after this one. I was amazed at how accurate Armstrong has been. RV definitely has to get Armstrong back for an update.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:43
      Hi guys. I have indeed met MA...as I have been fortunate to meet many other legendary investors. While I don't agree with everything he says...I do agree that he is largely correct in his analysis. But he and I should not be compared as he has been in (and proven himself) in this game much longer than I. Thanks for watching. Brent
  • RB
    Richard B.
    7 June 2018 @ 11:31
    I stopped watching as soon as he said the the FED wouldn't do QE again
    • BM
      Bryan M.
      7 June 2018 @ 20:21
      Hahaha!!!! I didn't stop watching but I did start laughing. In fairness though did he not suggest also that if the Fed DID try another round that he thought it would not work or work as well?
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:40
      Hi Richard - Thx for watching the first two minutes...LOL.
  • AH
    Ahmed H.
    7 June 2018 @ 11:06
    Great interview.. agree with everything Brent says. For me, what Brent says plays out if nature is allowed to take its course - but we all know that seldom happens..think international financial stability is now well in truly in Fed's mandate - over the last 48 hours we've seen RBI (india) and BI (indonesia) governors reach out to the Fed via op-eds and press confnc's - this noise will get louder - and i do not think Fed can ignore it - case in point is China at time of taper tantrum - china deval'd - equties came off- taper took a back seat. As an aside - the longer eM suffers due to dollar liquidity issues the sooner they look for alternatives - we have putin, china and india all talking about usd being used too often to undermine em economies - this just solidifies their case. I think the way out of this probably somethign as simple as giving EM c. bank USD swap lines - But i think we are still a way from that - and agree with u, usd can and probably does rally!!
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:38
      Hi Ahmed. Thx for your comments. If the flows don't come to the US...and insulate the US domestic market form the problems abroad...then you will be right and the Fed won't be able to ignore it. But if flows come...which I think they will...they can wait much longer than I think most people realize. We shall see. Thx again. Brent
  • PD
    Paul D.
    7 June 2018 @ 08:52
    The gold angle seems extraordinarily tenuous. Take a look at a DXY chart and a Gold chart. They have been negatively correlated for almost the entirety of the past 50 years.
    • BT
      Bryan T.
      7 June 2018 @ 19:42
      Paul what do you use to represent gold on your chart? Is there a gold spot price index comparable to the dollar spot price index for USD which is DXY. Thanks.
    • BM
      Bryan M.
      8 June 2018 @ 01:42
      Your key word there is..."almost".
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:37
      Hi Paul...thx for watching and for your comments. I think the correlation will break. We shall see... Brent
    • WM
      Will M.
      9 June 2018 @ 13:23
      Paul the last 50 years have seen monetary experimentation based on provision of credit and soaring debt coupled with that baby boomer generation buying stuff up and saving (somewhat) money and assets. Its most likely coming to an end.
  • SP
    Sat P.
    7 June 2018 @ 08:32
    This was very insightful. His predictions were either completely opposite to what I was thinking, or, he gave much better reasoning why things would happen such as Gold increasing in price which I have also been thinking for a while. This is the kind of content I love on RV. This is not the kind of discussion I will get with people at my work!
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:35
      Hi Sat - I appreciate you watching...thx. Brent
  • PB
    Pieter B.
    7 June 2018 @ 05:37
    Thanks a lot Brent!
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:35
      Thank you! Brent
  • GO
    Gary O.
    7 June 2018 @ 05:34
    Never a dull moment with Brent. Were wondering were you went, but like everyone, back to Real vision! Thank you!
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:35
      Thx Gary. Brent
  • jd
    john d.
    7 June 2018 @ 04:40
    Thanks Brent. I really enjoyed your presentation and have followed your work for some time. I think that we're all struggling with understanding how this all fits together and I was impressed with your openness and ability to change your thesis and roadmap ... a process that RV has been very helpful with.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:34
      Hi John...thx for watching and for keeping an open mind. Brent
  • SG
    Sophie G.
    7 June 2018 @ 03:47
    Love the hypothesis of the Milkshake theory. Agreed that EU & euro is a mess. I would like to ask Brent if China's increasing trade based diplomacy with EM, Russia Africa (CNY tdebt & trade in oil & goods) would actually take some of the heat out of the dollars rise over time. Hence, the US fiscal weakness will ensure dollars weakness, with gold becoming the main beneficiary of fiat currency devaluation and potential mayhem leading to new SDR based global trade currency.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:34
      Hi Sophie, thx for watching. I think many in the world would like nothing more than to ditch the dollar and move on to something else. But I also think this is much easier said than done. And while I have no doubts it will eventually happen, I don't think we are there yet...and don't think we will be in time to avoid a currency crisis. Thanks again. Brent
  • LA
    Linda A.
    7 June 2018 @ 02:52
    Brent, I really enjoy hearing your views. U are open-minded & smart. It feels like we got that huge blow-off top after Trump got elected & when China printed trillions just before Pres Xi got re-elected for life. Not sure of a coming blow-of top due to the Fed & Euro tapering. I thought it takes more & more debt to keep mkts propped up- law of diminishing returns. Wouldn't strong dollar kill off US companies with intl' exposure, thus squeezing their earnings & sales. I am not a Macro analyst but I believe in the strong dollar scenario. Trump made a mistake with repatriation at the end of a cycle. US has to provide dollars to the world. I feel mkts. are crash prone due to the Euro break-down, over leverage, massive debt & DB. Draghi ruined the bond mkt in Europe just like crazy Kuroda in Japan. Bring back Brent & Schiff for a part 2 interview.
    • BM
      Bryan M.
      8 June 2018 @ 01:44
      Good idea.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:32
      THanks for watching and for your nice comments. Brent
  • TH
    Thomas H.
    7 June 2018 @ 01:02
    He kept saying "we got that wrong." I will continue to follow the charts instead of guessing.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:31
      Hi Tom...good plan. Thx for watching Brent
  • AC
    Alessio C.
    7 June 2018 @ 00:39
    I need to watch this again. He said, "Rates are going higher and equity too". I'm having a hard time to picture it. The long-term trend for bond and equity is in the same direction - what did we have in the last 40 years? Short term negative correlation has been used for parity portfolio construction but usually works in downturns i.e. equity down, rates down and not vice-versa, equity up, rates up. I do believe in the dollar getting stronger. The only refrain I have is in Trump / Fed / etc. killing it before getting started. Let's say gets to parity with Euro. What happens next? What will Trump's administration do? More tariffs to lower the trade deficit? Maybe more fiscal stimulus and deficit spending. Is that bullish for the dollar as it sucks liquidity? Maybe. Do I want to buy a currency whose government is running 1 trillion dollars deficit each year? Maybe not. Let s see Europe. Choas. Euro down. Equity down. Rates up? Huge surplus? Who's buying? China more Mercedes or BMW? Will Americans be pilling more debt? I have a feeling that the next big one will be brought about by something which is outside the control of governments or central banks. While I do feel that FX fiat currencies can be controlled to lower their value (not so much to get their value up when they start to go down). The dollar bubble may be nipped in the bud. That's why I see gold (physical) as the killer. It's outside their control and cannot be stopped when started unless with the use of coercion. I'll watch this again.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:31
      Hi Alessio - thanks for watching and for your comments. I'm of the opinion that while Central Bankers and Politicians may still be able to exert some very short term influence on markets...that the golden age of monetary authorities is over. The markets are in control now. And just bc the CBs and Politicians want something...i don't think they are going to get it. Thx again. Brent
  • FM
    Faris M.
    7 June 2018 @ 00:23
    This is what an analysis should sound like. Spoken with humility to admit ones mistakes and be contrarian not for the sake of it but because the empirical evidence points that way. Well done.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:28
      Thanks Faris - Brent
  • ns
    niall s.
    6 June 2018 @ 23:08
    Sounds like a very persuasive guy , however if you do the math , Nixon took the dollar off the Gold standard in 1971 at a rate of 1 oz gold= 35 $ . If you go to saving.org and check what 35$ in 1971 is worth in today's dollars you get this : Amount: 35 From: To: Inflation Results $35 in 1971 equals $216.79 in 2018. Am I missing something ? Could well be, as I have been working nights for ten weeks at its 2000 am right now , so if anyone can explain why Gold should be even worth 1300$ an ounce today I am all ears . thanks
    • DT
      Douglas T.
      6 June 2018 @ 23:51
      Because it si the only form of money that survives a monetary collapse: it's still sitting there exactly as it was before. Therefore, by default it will be the only left reserve to reboot the banking system. That is it can back a new base-money supply. Our current base money supply is the Fed balance sheet = $4T, against 8133 tons of gold. High school math yields a price of gold of $15,300 per oz. Since a collapse is considred a remote possibility, the reserves can be hypothecated, reducing the price of gold until a collapse is staring them in the face.
    • HO
      H2 O.
      7 June 2018 @ 00:08
      Money as we know it is a product of technological innovation. We are not going back to gold or wampum. Gold is only a spec asset that sometimes gets to dress up as a hedge.
    • JM
      Jason M.
      7 June 2018 @ 02:49
      I am not going to suggest a current value for gold. I don't know that number. However, your starting value really isn't that accurate. Gold wasn't worth $35 in 1971...that was what the governments told you it was worth until they couldn't control the gold standard withdrawals any longer. The market told you right after that what it was really worth. Within a few years it was in the 700s. So another way of looking at gold's actual lack of appreciation is that from 1974 until now it has only gone from $700s to ~$1,300 Does that seem in line with your sense of US or global inflation since the 1970s?
    • TB
      Tim B.
      7 June 2018 @ 04:44
      Niall, RV did a fantastic two part series on gold a few months(?) back. Check that out. For starters, just pulling gold out of the ground is incredibly expensive. Were the gold price to fall too far, gold mining becomes uneconomic. So I believe there is a natural floor of sorts to the gold price.
    • JM
      Jason M.
      7 June 2018 @ 05:43
      Tim B - please understand that mining supply is not a huge determinate of the gold price in the short or intermediate term. Above ground stocks are the largest of any metal in mining relative to annual incrementally "sales/investments". Your point about gold being expensive to mine is fine but its not something a value investor should be hanging his hat on in this case. other metals? absolutely.
    • TB
      Tim B.
      7 June 2018 @ 14:44
      Hi Jason Interesting points. Thanks for the feedback. It seems you done a bit more deep dive research than I. Cheers
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:28
      Hi...thx for all the comments. Don't have space for all my gold arguments here. Suffice to say if view gold as a currency...and if fiat currencies burn (with IMO dollar burning down last) that could easily take us to $5k gold. Brent
  • JS
    Jason S.
    6 June 2018 @ 21:45
    Excellent food for thought!!
  • NH
    Neil H.
    6 June 2018 @ 19:28
    someone has to be very wrong as the story changes every day on the dollar depending on who you are listening to. either way great video.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:26
      A lot of smart people on both sides of this argument...thx for watching. Brent
  • HO
    H2 O.
    6 June 2018 @ 19:21
    Some very interesting ideas, and this is worth a second view. But I don't agree with the Fed reaction function if there is a debt crisis. If the problem is corporate debt, they will have no choice to deal with corporate debt, just like they did mortgages and everything derivative to that. If that happens, the expectation of another round of QE should be much more bullish for gold (or anything that is liquid and supply inelastic in the short-term) than it is for the dollar. As for buying equities because everything else is bad, this doesn't make sense given the reality that the biggest risks now are from corporate debt markets. With valuations and debt levels both high, expected future returns should be dropping, not to mention that you don't want to get crushed at the bottom of the capital structure.
    • WS
      Will S.
      6 June 2018 @ 20:42
      Good post, but keep in mind he did not say valuations or fair value are the reason for equities going higher. He specifically used the words "blow off top". He's saying the bubble will get bigger and go through a real mania phase. That falling wedge pattern he mentioned looks pretty eerie. It looks like either a breakout is coming or this is a bull trap and the correction from early February was just the start. Brent is arguing the former.
    • HO
      H2 O.
      6 June 2018 @ 23:37
      Good points.
    • YZ
      Y Z.
      7 June 2018 @ 02:49
      the final pop in 1999 was a fast 20% move.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:26
      Hi all....thx for comments. As Will pointed out...I'm not suggesting equities based on valuations. I'm just saying that for better..or for worse...I think they are going higher. Time will tell. Thx for watching. Brent
  • SS
    Steven S.
    6 June 2018 @ 19:16
    Don't forget the unofficial government debt via HUD - identified first by Catherine Austin Fitts and then officially 'peer-reviewed' & validated by a team of graduate students in a survey of DOD and HUD financial reports for fiscal years 1998-2015 by University of Michigan's Dr. Mark Skidmore. The result? The amount of documented “undocumentable adjustments” at just HUD and DOD alone surpassed the size of the official outstanding debt of the United States that Brent mentions - MSU Scholars find $21 TRILLION - with a "T" in additional unauthorized Government debt.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:23
      Hi Steven - Yes, these should certainly be considered. And long term the US is in a world of hurt. But many other countries have all the same issues...some of them even worse. So while I agree with you...until the whole game blows up...its a relative world we live in. And as such I think the price of dollar rises. Thx again. Brent
  • BP
    Bob P.
    6 June 2018 @ 19:11
    I'd like to see him debate Juliette Declerq. I'd actually pay to hear the debate.
    • HO
      H2 O.
      6 June 2018 @ 19:26
      I would buy a ticket to that show.
    • HO
      H2 O.
      6 June 2018 @ 19:29
      I hate replying to myself, but here is the idea for RV - pay per view macro pugilism. Put together a good "fight card", charge a fee and give the presenters a cut of the gate.
    • HO
      H2 O.
      6 June 2018 @ 19:30
      Call it Bob's RV Fight Night.
    • SS
      Steven S.
      6 June 2018 @ 19:45
      yes please.
    • AG
      Amir G.
      6 June 2018 @ 20:26
      Juliette Declerq sees an opportunity in shorting the dollar in the short to medium term but in the long run she also has a bullish outlook on the dollar. Please correct me if I'm missing something here...
    • DW
      Daniel W.
      7 June 2018 @ 11:30
      @Amir G., as far as I unferstand her longterm target for EURUSD is 1.40ish. Not particularly Dollar bullish.
    • GA
      Greg A.
      7 June 2018 @ 14:10
      I agree but also a few others like Luke Gromen and Jeffrey Snider would bring a well balanced tag team with other intelligent views
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:22
      I'm in...! Brent
  • AA
    Aymman A.
    6 June 2018 @ 19:09
    We are assuming that the dollar will follow the RID (real interest rate differential) or growth rate differential model. The IMF model for currencies is based on budget and trade deficits. Often it is developing countries that have currency blow ups due to these twin deficits. We are assuming that the IMF model cannot apply to any of the G7 countries or at least the .reserve currencies. Why?? This Milkshake Theory is based on the implicit assumption that interest rate differentials will remain the driving force for reserve currencies. What if the dollar weakens because the regime has shifted and interest rate differentials are no longer the driving force?
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:21
      Hi Aymman. Thanks for watching. Nothing is certain and several very smart people (many of my friends) disagree with my thesis for some of these very reasons. We shall see. Thanks again. Brent
    • WM
      Will M.
      9 June 2018 @ 13:14
      Then you gold insurance will do very well.....
  • KJ
    Keith J.
    6 June 2018 @ 19:03
    Any chance of an audio download?
    • CM
      Christopher M.
      6 June 2018 @ 21:28
      If you use the iOS app you can download the audio.
  • AK
    Alek K.
    6 June 2018 @ 18:35
    fantastic piece, will have to check out his previous RV content -- side note i hope RV brings back adventures in finance alongside their new podcast, it's what turned me and several other people i know onto RV. Was a great first step into what RV is attempting to do with financial media
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:20
      Thanks Alek - Brent
  • TM
    Thomas M.
    6 June 2018 @ 18:08
    Brent.....Great thought provoking piece. I believe the dollars will continue higher as long as interest rate rise. Until we see a break out of Gold on high volume, I am having a hard time positioning even though I continue to want to own it badly for the last two years. If the market goes higher for stocks from here, so be it. Trying to buy at these P/E valuations on a new position has too much risk and scaling back on size and positions up at these levels after such an incredible run makes sense to me. I can understand your thought process and thank you for the insight and thesis. This is just my humble opinion and I look forward to seeing how these markets play out over the next coming year. It's fun to see great comments from so many people that are very different from each other. It makes you think outside your comfort zone. It provides you a chance to see which thesis is playing out better and to adjust to market conditions. Great job to RV, Brent and other subscribers.
    • RM
      Ritwik M.
      6 June 2018 @ 18:23
      rrply
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:19
      Hi Thomas...thanks for watching and considering the thesis. Brent
  • PO
    Paul O.
    6 June 2018 @ 16:34
    The more I listen to this scenario the more I come around to agreeing with it. It is similar theory to what Daniel Want presented last year in - A New Lens on Market Dynamics. "The funny dynamic, or at least a scenario that could unfold in the world in the future, is that this bull market could actually continue as stresses in the rest of the world continue to drive this demand in the US dollar, or demand for US dollar, liquidity at the same time as we're having these problematic banking system issues and problematic capital fire sort of issues in different parts of the world, causing this to persist, causing that P/E multiple expansion to persist. So we very conceivably could have a continuation in this bull market to much, much higher levels driven by P/E multiple expansion whilst earnings realistically probably continue to deteriorate, or at least surprise on the downside, for the next few years. "
    • RA
      Robert A.
      6 June 2018 @ 16:40
      Daniel Want is one smart Cookie, IMO. I have gone back and listened to some of his earlier RV pieces and have always gotten an additional bit that I didn’t get the first time from each viewing.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:18
      Hi, thanks for comments. My call on equities is not one from a valuation standpoint. I'm not even saying equities SHOULD go up. I'm just saying that I think that they are going to. Thx again. Brent
  • AH
    Andrew H.
    6 June 2018 @ 15:21
    Fine opinions. I generally disagree, and put a slight probability that the USD is in a bear mkt rally (60/40 or 70/30%) and will begin to weaken again. I am concerned that we have previously seen the flow of funds into the US over the past ten years, and that we may see those flows reverse in the near term(especially if the US stops raising rates). There fore looking to get flat US equities, build positions in EM(hopefully after some good damage) and commodities. My time frame, 2-4 months(ish) for the set up and then ride those trades if my thesis plays out. I will react accordingly based on the actual direction of the USD, JMHO
    • AA
      Aymman A.
      6 June 2018 @ 19:17
      Agree with thesis. Just look at the long term charts (monthly or weekly). Unlike previous dollar bull runs such as the one in 2013 and 2016 where open interest rose aggressively, this time the dollar rallied without any increase in open interest. The Euro fall was actually preceded by dramatically falling open interest. Also gold remains resilient. Gold market does not seem to believe that dollar bull will continue. All this smacks of a bear market dollar rally. Just my thoughts.
    • DW
      Daniel W.
      7 June 2018 @ 11:34
      Totally agree. I think main driver for EURUSD is interest rate differentials. Yields in the US will not rise a lot more from here and ECB will slightly reverse their dovish stance. Money will flow back to the EUR.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:17
      Whether you agree or disagree...I appreciate you watching and considering the thesis. The good news is that this won't remain a mystery forever...at some point soon we will find out. Thanks for watching. Brent
  • TB
    Tim B.
    6 June 2018 @ 14:27
    To Brent (and anyone else who cares to respond) Great thought piece. A question... You said, "As we lift up our interest rates, that sucks liquidity into the U.S. markets" Ok, but as you yourself noted, liquidity in the past has flowed into some assets (real estate, stocks), but not others (gold etc.). So while I understand how higher rates could pull in liquidity to the U.S., higher rates also serve as a disincentive to own stocks, no? Why would someone buy a high risk asset, when a lower risk asset offers better returns? Am I missing something here?
    • RA
      Robert A.
      6 June 2018 @ 16:42
      Bitcoin...nope your not missing anything...just human nature.
    • TS
      Timothy S.
      6 June 2018 @ 17:07
      Just a guess. During a monetary crisis perhaps good quality stocks will be perceived as less risk than, say, unsecured bonds or even govt. securities.
    • DS
      David S.
      6 June 2018 @ 17:20
      Gold's value will increase sharply when the international monetary system starts to break down is the thesis. DLS
    • CM
      Christopher M.
      6 June 2018 @ 21:32
      Think about the Swiss National Bank, they have been buying US equities as part of their QE. Although it may not be part of the inflows spoke about directly in this piece, they are still in QE mode hence are long US equities.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:15
      Hi...thx for watching and for your comments. To be clear, I don't think funds will ONLY into equities. I'm just making the case for why I think they will go higher...despite the already lofty valuations. Also, at some pt higher interest rates would be a disincentive. But before that...and at current levels...raising rates can also be an incentive to put money into the market before the financing of a project costs even more down the line. Thx again. Brent
  • SS
    Steve S.
    6 June 2018 @ 13:50
    He expects Gold to hit 5000, Where does he expect Equities to go? And what about Bitcoin?
  • AG
    Amir G.
    6 June 2018 @ 13:41
    I wish this was a bit longer and more in depth. I'm fine paying for a subscription that gets me only one of such videos per week and nothing else.
    • rr
      rlw r.
      6 June 2018 @ 18:02
      Yes please RV, more consistent 'airtime' from top draw guys & girls.
  • CS
    Charles S.
    6 June 2018 @ 13:41
    Very interesting, thanks. The cycles and technicals support your narrative on gold, equities and bonds
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:11
      Thx Charles. Brent
  • EL
    Elizabeth L.
    6 June 2018 @ 13:08
    Thank you Brent. Brilliant. Appreciate your thorough analysis.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:11
      Glad you found it interesting....thx. Brent
  • JM
    Jim M.
    6 June 2018 @ 13:00
    This is REAL VISION at its best. Brent ought to be included in the select circle of RV's "rock stars".
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:11
      Thx Jim. Brent
  • MM
    Mike M.
    6 June 2018 @ 12:56
    What would Peter Schiff say? Mike M.
    • SW
      Scott W.
      6 June 2018 @ 13:58
      He would say "the Fed are morons and there is inflation and Bernanke is an idiot and Yellen is an idiot and the Fed is an idiot and that there is inflation and the Fed don't know what they're doing and buy gold and buy silver and Bernanke was a moron..." And then he'd do variations on that for an hour or so.
    • BM
      Bryan M.
      7 June 2018 @ 00:58
      Now THAT...is funny!!
    • LS
      Lee S.
      7 June 2018 @ 11:05
      Don't forget, he will try to sell you his services at the end... :-)
    • WM
      Will M.
      9 June 2018 @ 13:09
      very funny Scott, but also too true, Schiff loses credibility because he is so emotionally involved.....
  • KH
    Kavi H.
    6 June 2018 @ 12:48
    Interesting.... So If I get this correct: Brent Johnson: US Dollar Up, Treasury Yields Rise, US Equities Up Juliette Declercq: US Dollar Down, Treasury Yields Peak then Fall, European Equities Outperform US Equities Alex Gurevich: US Dollar Up, Treasury Yields Fall, Global Equities Collapse Raoul Pal: US Dollar Up, Treasury Yields Fall, Global Equities Collapse Felix Zulauf: This one was the most complicated but also detailed: Stage 1-> US Dollar Weakens (It already has since his interview, to some extent), China put the breaks. Stage 2-> a) If US Dollar Strength causes Too much pain due to debt... Which also felt like it happened (Turkey, Argentina). Central Banks will ease or at least put the breaks on the tighting (But didn't Europe just announce they would start Tighting earlier than expected)? Markets will rally for a final leg and US dollar weaken and there would be an extended commodities boom classic late cycle. FANG would be the stocks to own in this last phase. B) US Dollar strength continues for longer in which case China putting breaks will cause another commodities downturn which will reset the commodities bottom to 2019.
    • RA
      Robert A.
      6 June 2018 @ 16:50
      Nice curation there, my good fellow. That’s the biggest takeaway I’ve gotten from RV—Very well reasoned arguments and positions concisely articulated from highly credentialed guests.....which can be.....wait for it....juxtapositional. RV has really helped me with understanding that on many of the Big issues and potential Market turns that there are, indeed, quite balanced countervailing well reasoned Arguments.
    • rr
      rlw r.
      6 June 2018 @ 17:58
      Yep, and it's the true value add of RV - intelligent discourse by smart dude and dudettes.
    • CM
      Christopher M.
      6 June 2018 @ 21:37
      This is why there is a discourse on every medium in which the financial markets are discussed. Maybe RV can lead the way in asking guests to match a single timeline and have an RV definition of Short-term, Medium-term and long-term. Or speak with the guest pre/post interview and annotate the guests' definition.
  • SW
    Scott W.
    6 June 2018 @ 12:46
    I love that Johnson is able to say "I'm wrong and here's where I was wrong". I love too that he discusses counter arguments to some of his positions. I contend that the quality of any deep-dive discussion would higher were more of the presenters to adopt that model. Because, as alluded to herein it's complicated - far far more so than "if A then B".
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:10
      Thanks Scott...wish I didn't have to say that as often as I do! Brent
  • PD
    Peter D.
    6 June 2018 @ 12:15
    Brett Johnson is part of the Real Vision's 1% (of top thinkers). His "Step into the Liquid" presentation from a couple of years back provides an excellent metaphor as to how difficult decision-making is in the current environment. This particular call - that equities and USD are going higher - is bold and way "out of the box." But it's worth considering.
    • rr
      rlw r.
      6 June 2018 @ 17:53
      Concur entirely, and yes Brent is in RV's 1% top thinkers. Sure hope we see more of them as Raoul promises.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:09
      Thx for nice comments. Brent
  • DH
    Dennis H.
    6 June 2018 @ 11:37
    Sure? You don't think a strong dollar will be looking for value around the globe?
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:08
      Hi Dennis - Nothing is certain...and I'm sure there will be some dollars searching for an investment home abroad...especially deep value. But I believe net flows will strongly favor inflows into US Domestic market. Thx. Brent
  • GM
    Greg M.
    6 June 2018 @ 11:31
    The interview had good pacing and a well thought out thesis. I agree with his end game analysis. Time will tell how this pans out. This thoughts about dollar strength reminded me of Jeff Snider talking about the problems of the Euro dollar funding in 2008.
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:06
      Hi Greg - I'm a follower of Jeff as well...I think he's brilliant and his analysis has helped me develop mine. Thx for comments. Brent
  • LJ
    Lucille J.
    6 June 2018 @ 11:13
    I love this Dude
  • NG
    Nick G.
    6 June 2018 @ 10:44
    Interesting theory. I am not sure I agree, I probably disagree, but that is fine. I appreciate being told how the other side thinks, therefore I am glad I listened to Brent and will have him in the back of my mind if I see developments in DXY that I cannot explain. That is exactly why RV is good, as far as I am concerned: the "double check" against my own opinions. And the ability, in future, to adapt to whatever is working. If he is right and I am wrong, I will be more than happy to jump on his bandwagon, now that I understand it. Since his theory is so interesting and has so many implications for bonds, currencies and equities, why spend 1/2 the interview talking about an asset class that is as minor as gold?
    • BD
      Bruce D.
      6 June 2018 @ 12:16
      Because Gold has been and will always be the world currency of last resort. Plain and simple to say, but so ridiculously hard for US investors to comprehend, because the dollar has been the worlds reserve currency since WWII. Everything revolves around it and the US exorbitant privileges.....and it’s in the process of ending!
    • YW
      Yowshi W.
      6 June 2018 @ 17:37
      He didn’t touch bitcoin or digital currency, which can be much more as a store of value than gold IMHO
    • SP
      Steve P.
      8 June 2018 @ 07:23
      Dear Maria With all due respect, try putting some bitcoins under your bed for safe keeping !!
    • BJ
      Brent J. | Contributor
      8 June 2018 @ 20:05
      Hi Nick - Thanks for comments. I commented on gold bc I'm a huge believer that everyone should own it. And everyone always asks me about it. Would be strange for me to do an interview and not comment on it in some form. Thanks again for watching and comments. Brent
  • AM
    Artur M.
    6 June 2018 @ 10:36
    Comment to QE. We and other CB were tricked by FED to think it's money printing. It never was, it was a way to increase inflation expectations only as the QE ended just as an entry on banks balace sheet which was later deposited at FED and gave banks free interest on that money. It was a way to prop up the banks.
  • AM
    Artur M.
    6 June 2018 @ 10:36
    Comment to QE. We and other CB were tricked by FED to think it's money printing. It never was, it was a way to increase inflation expectations only as the QE ended just as an entry on banks balace sheet which was later deposited at FED and gave banks free interest on that money. It was a way to prop up the banks.
  • AM
    Artur M.
    6 June 2018 @ 10:36
    Comment to QE. We and other CB were tricked by FED to think it's money printing. It never was, it was a way to increase inflation expectations only as the QE ended just as an entry on banks balace sheet which was later deposited at FED and gave banks free interest on that money. It was a way to prop up the banks.
  • TJ
    Terry J.
    6 June 2018 @ 10:18
    Wow! Brent sure knows how to totally unsettle my market view! I am going to have to watch this a couple of times to really absorb all of his reasoning. I certainly can’t agree (yet) with everything he is saying especially on the direction of bonds and equities, but of course since 1971, the trend direction of the dollar as Brent suggests, so often determ