The Big Regime Shift

Published on
April 19th, 2019
Duration
44 minutes

The Big Regime Shift

The Larry McDonald Series ·
Featuring Mohamed El-Erian

Published on: April 19th, 2019 • Duration: 44 minutes

Mohamed El-Erian, chief economic advisor at Allianz, tells New York Times best-selling author Larry McDonald why he sees the carry trade and market structure as the weakest links in the economic cycle. El-Erian then defines which macro policies present the greatest risks going forward. He also shares some of the lessons he’s learned along the course of a long and varied career in the financial world. Filmed on April 2, 2019 in New York. Find more information about Larry McDonald’s work at http://www.thebeartrapsreport.com.

Comments

Transcript

  • CL
    Chris L.
    27 April 2019 @ 05:54
    GTF out of here. The fed was worried about market technical? 😂 If you want to know the answer, simply look at credit markets and financial conditions from mid-September (front running QT boost to $50B) and into late Q4. Spreads blew out. High yield froze. Powell wasn't like, "Oh, man... This looks like 3 peaks and a doomed house."
  • FD
    Felix D.
    22 April 2019 @ 19:15
    A major plus is definitely the gesture of "the mismatch"
  • CF
    Cause F.
    22 April 2019 @ 07:08
    Great interview!
  • BS
    Bradley S.
    21 April 2019 @ 14:08
    Very interesting interview, but very disappointing transcript. If I like an interview, I'll watch it twice and then carefully read the transcript. This one reads to me a as mediocre-quality, human transcription, with inadequate proofreading. Clearly the transcriber had difficulty with MEE's accent, so that flags a weakness in the RealVision process. They get top-notch people to interview, but then cut corners with cheap transcriptions. Examples-- "Towards the middle of the year, it became clear, that [the] Fed had started to guide towards full hikes". Wrong: he said "..towards four hikes." "..problematic for the Fed, this market hasn't has been emboldened." Poor proofreading: he said "..has been emboldened."
    • AR
      Alex R. | Real Vision
      21 April 2019 @ 18:42
      Thanks for your comment, Bradley. We’ll do better next time.
    • BS
      Bradley S.
      22 April 2019 @ 15:58
      Thank you Alex, I appreciate your commitment to improve. Apologies for having gotten frustrated. Ironically, I see that I made a proofreading mistake myself :\
  • TS
    Todd S.
    21 April 2019 @ 12:56
    Great well rounded insights. Well done
  • IH
    Iain H.
    21 April 2019 @ 07:18
    El Erian is an insider on board withe whole global world order narrative, IMHO that suggest to me he would be not too critical even if her thought the outlook warranted it, which it may not, but insiders always leave the listener wondering if they get the truth or the spin. The truth is what I am expecting from RV, keeping away from the global world order spin. So in short I take what El Erain says with that in mind meaning you have to dig deeper to ensure the truth or not.
    • BD
      Bruce D.
      28 April 2019 @ 18:29
      I agree Iain, I never got the feeling that MEE was giving the hard hitting truth either, as he sugar coated way too many questions. Must be the academic and IMF background, which NEVER allows complete honesty.
  • JE
    John E.
    21 April 2019 @ 05:16
    One of the best guests on Real Vision. Nuanced, academic analysis with the ability to communicate with Main Street.
  • TM
    Tom M.
    20 April 2019 @ 21:22
    The best way to stabilize Europe is a managed breakup. The EU system wants to break up, yet there are people who are working to force unity.
  • BK
    Bruce K.
    20 April 2019 @ 18:47
    The section on Europe is off-the-charts good. Spot-on.
  • WC
    William C.
    20 April 2019 @ 18:34
    El-Erian interviews are generally very high level finance/economics discussions with little substance. With that being said, this was the best El-Erian interivew I have seen. I was pleased that Larry didn't spend time asking him about Bill Gross as others often do, which i believe makes everyone a bit uncomfortable including the audience.
  • IA
    Ibrahim A.
    20 April 2019 @ 17:58
    While the guests Larry has been able to bring are an impressive addition to RV, I find that he struggles to stay on one thought and jumps around a lot, going from one topic to another completely random topic. Further, he seems to lack the depth / rigor to ask meaningful questions.
    • BS
      Brandon S.
      20 April 2019 @ 23:07
      I agree, he always gets in a book plug though 😁. Which I really enjoyed btw. I like M. Green too. Wish they’d get Jeff Snider on.
    • DC
      Dan C.
      22 April 2019 @ 08:06
      Jeff Snider - that's an interview worth watching
  • HS
    Hendrik S.
    20 April 2019 @ 13:03
    An Office guy, no skin in the game, boooooring
  • LC
    Louis C.
    20 April 2019 @ 11:47
    @20:45: "You saw a triple short vol ETF emerge". What the hell is he talking about? Triple short vol ETF? There isn't a double short vol ETF... so come on (there are a 2x LONG ones - TVIX, UVIX)! It's interesting to listen to these good a talking guys. They are quite fascinating, and look so smart. I feel such admiration for them. Then for some of them, they come to a field where I have extensive knowledge... and boom ... what they say on this field is such a large BS, that you now wonder that the guy you previously thought of being over smart,... is maybe just good at talking fraud. Or at least their knowledge is much narrower than what it looks like. A few regular RV speakers never disappoint, and are really uber brillant: my favourite Michael Green!
    • MK
      Michael K.
      20 April 2019 @ 18:14
      As an experienced option trader I appreciate your point. Yet, I respect his assessment in terms of being balanced, realistic, without proclamation but not ambiguous either. My one take away from his interview is the question of whether we will get an Austrian or a fiat response going forward and the consideration that reality will be somewhere in neither absolute pole. I think that’s more realistic than being a perma- one view or another.
    • BS
      Brandon S.
      20 April 2019 @ 23:05
      I agree Louis
  • SH
    Stefan H.
    20 April 2019 @ 11:31
    Fantastic interview!
  • nd
    nicolas d.
    20 April 2019 @ 07:24
    Fantastic piece, if you could make Mr ElErian a regular interviewee (3/4times a year?) that woould be awesome
  • PB
    Pieter B.
    20 April 2019 @ 06:06
    Fantastic interview! Massive thanks!
  • dd
    david d.
    20 April 2019 @ 03:48
    a good interview to confuse people, that guy is like an eel
  • DS
    David S.
    19 April 2019 @ 20:59
    You can fool the world with the Plaza Accord once, but those days are gone. Floating FX rates - good, bad and ugly - are here to stay. The massive amount of money in the investment world will blow any new “accord” up. Floating FX rates are marketa with real skin in the game. Why do folks really want to go back to something that did not work and will not work? DLS
  • JS
    Jason S.
    19 April 2019 @ 20:49
    He has a way of talking but not really saying anything
    • DS
      David S.
      19 April 2019 @ 23:35
      We all hear and understand things differently from our experience and interest. I enjoyed this conversation as a heads up on Europe, China, past markets, etc. It was a little scary that Larry believes that there could be another Plaza Accord that would help. Maybe I misunderstood. I will check the transcript. DLS
    • JB
      Jack B.
      20 April 2019 @ 13:06
      Totally agree. Never says anything I can hang my hat on
  • GC
    George C.
    19 April 2019 @ 20:38
    I wish Real Vision would ask every interviewee how they are positioned AND WHY. This interview, while interesting and informative, pulled up short.
    • JM
      John M.
      20 April 2019 @ 01:17
      I agree. Real Vision interviews some of the smartest people in finance so why isn't this a standard question? I realize that we may have different investment objectives, time frames, risk preferences etc., but I would still like to hear their thoughts ?
    • CS
      Christopher S.
      20 April 2019 @ 06:55
      In fairness a lot of the answer would most probably be something like: "I'm biased towards this, I think there is some asymmetry here, if this happens then I think there is an unappreciated chance of that happening. Ultimately you only get so far making "calls" and "predictions". People that are too rigid don't last that long - look at Einhorn for example. So any predictions would come with strict caveats like, "I like this right now, but it could go completely against me."
  • SF
    Stephen F.
    19 April 2019 @ 19:14
    This guy blew up the Harvard University endowment, then went back to what he does best: coming up with catchy phrases that get him talk show interviews. No ability to allocate capital. Jan M. is right: no skin in the game.
  • SW
    Scott W.
    19 April 2019 @ 19:10
    I got say, on this one the emperor has no clothes. This is just an undoubtedly very smart guy saying a bunch of stuff everyone already knows as though it's new and profound. There is no original insight. Or, I just a dumba$$. Or perhaps both.
  • JM
    John M.
    19 April 2019 @ 18:57
    Enjoyed this conversation. I wonder how he invests his money in this environment?
  • WM
    William M.
    19 April 2019 @ 18:15
    Superb!
  • ML
    Matthew L.
    19 April 2019 @ 17:52
    I got nothing from this....
  • JM
    Jan M.
    19 April 2019 @ 17:39
    Tawk, tawk, and more tawk. Does he have any meaningful positions on? Don’t think there’s any skin in his game.
    • SW
      Sean W.
      19 April 2019 @ 18:13
      This has always been his problem as an Academic. Doubletalk just like the Federal Reserve (also full of ivory tower academics) generates.
    • AD
      Airvind D.
      19 April 2019 @ 19:28
      Seems like you're using RV for trade ideas? If so, good luck. I'm not a fan of el-erian but he's managed more money than you can dream of (ie he knows a thing or two). Good stuff RV
  • JA
    James A.
    19 April 2019 @ 14:00
    Didn't realise how smart MEE was until today. He's got a very solid global macro view. Larry. It's been a quality series you've run, if ever your bear traps report would offer a price point closer to retail rates I'd love to sign up! Best James
  • RM
    Ryan M.
    19 April 2019 @ 13:31
    Is it just me or does Mr. El-Elrian never really give an answer and just rewords what Larry asks him?
    • DC
      Dan C.
      22 April 2019 @ 08:02
      He never commits to anything, ever. I haven't watched the video but I've seen him so many times. I checked the comment and of course yours is the top... because this is what he does. Sorry RealVision - this one isn't worth my time. It probably wasn't worth yours either.