The Ledger, every show

“Something that's still little commented on today is that the Fed provided a bridge loan to the tune of two hundred and twelve billion dollars to the FDIC's bad bank.”

“The point here is that so successful has the Fed's backstop of regional banks and so forth been That it has not only prevented the accelerating tightening of credit we all expected after Silicon Valley Bank, it's actually incentivized banks to be calm, be meas…”

“For the first time in, let's say, roughly, 25 years, Ted, you and I, and everyone listening, we're paid not to have a view because money is not free anymore. If interest rates are zero, then we have to have a view all the time. Because any decision to step out…”

“But as we get into the back end of 2023, my best guess is no later than early fourth quarter. That's a guess. The cumulative impact of hikes starts to bite. The consumer starts to retrench a little. Continuing claims are heading up. The labor market keeps soft…”

“The Reserve Bank of Australia, as they have acknowledged and admitted and apologized for, which is unprecedented, made a mistake Coming through COVID by saying that we do not expect to raise policy rates for three years.”

“There is a negotiation underway, which could take some time to see whether Australian critical minerals producers could be approved by Congress for participation in US defense procurement. That would be an enormous development”

“I'm starting to think that as important as that inflation conversation has been, I'm not sure that matters anymore, or at least not to the extent we thought it might three weeks ago, because this is now exclusively about geopolitics.”

“It seems a growing number of investors realize the seriousness of the situation we face today, and the desire of minimizing their maximum regret over getting this Ukraine situation wrong. And that is starting to impact asset prices far beyond energy and commod…”

“What US Treasury learned in 2014 is that if you put Gazprom Bank on the sanctions list, you break energy payment trails everywhere. Because Gazprom Bank is the key intermediary, or has been, the key intermediary for all sorts of global payments from global ene…”

“And obviously, most of all, that would probably continue to be a very strong headwind for what remain hideously overpriced long duration hyper growth stocks. I mean, obviously, but it's also a bit of a headwind for credit.”

“The stability and growth pack in Europe, which by the way, I think is dead anyway”

“There were times over the past week where there was no treasury curve and the treasury futures market was not functioning.”

“And all in all, I might run that position for four or five years, 40 to 50 times levered. And I know that sounds extreme. But that's what people do.”

“The reason that investment grade credit has been broadly widening out is because some of it's trading. The reason that leverage loans have been broadly well behaved is because people are selling all the liquid leverage loans they have, and all the less liquid …”

“Unlike 2008, every regulated financial institution and all the big ones has more liquidity, has more capital and generally less leverage. If we assume that central counterparties are robust, given all the derivatives that are now centrally cleared, the financi…”

“All it would take is a minor turn in those outflows to generate a fairly substantial re-rating in both UK equities and Eurozone equities in particular.”

“Again, there's no mechanical feed through because it's reserves which are endogenous to the financial system. They can't be lent out. And they can be lent between banks and the Fed, but they can't be lent out.”

“The CDOs were non-mark to market vehicles unless and until they were downgraded. And once they were downgraded, it was price discovery free for all. And that was the end of it. That was the point of no return.”

“When you falsify the key assumption underpinning any liquidity or credit cycle, you get mean reversion and then some”

“Part of the tremendous success of the true macro pioneers was the broadness of their mandate. I will have a top-down view of the world, but I will use any instrument under the sun to express it, compared to the more recent past, where macro has become institut…”

“You need the right clients. You can't have clients who ring you up every Friday saying, what have you done this week? That is just no way to manage money. But I'm afraid that's tended to go hand in hand with a lot of the institutional allocations that macro ma…”

“And they are going to be slow and gradual for a long time to come, barring a tremendous exogenous shock.”

“You would think based on that observation, the probability is higher that in 2018 and 2019, the US economy will run a bit hotter than it has done over the past several years.”

“My sense is, subject to revision, that we're looking at late cycle asset price valuations, but shockingly, the US economy might be mid-cycle”

“So the common assumption that worries me most about China is that they must have a subprime-like crisis at some point. I'm not sure about that. A financial crisis, some kind of credit cycle, liquidity cycle, defaults, for sure. But to use that subprime mental …”

“Whether it be passive money or active money, over the next several years, there will be increasing allocations to Chinese onshore equities, and that's not going to go away.”

“The Bank of Japan sort of Waffles from time to time about exiting their asset purchases. I don't see how they can. I really don't.”

“There's no banking union. There's no capital markets union. And arguably, given the setbacks, the self-inflicted setbacks that Merkel has had, You know, the probability that we're going to get widespread structural reform is going down by the minute”

“It's popularly believed that the taper tantrum was a colossal communication error by Ben Bernanke. I'm not so sure about that. He was telling people via his speeches from February, 2013 onwards that he thought U S long-term interest rates were too low and peop…”

“When central bankers privately and publicly tell you over and over again that we're trying to reactivate markets And when they go on and on about, oh, geez, implied volatility's too low, they're actually saying that our tolerance for some kind of market correc…”

“How many million people is Modi going to lift out of poverty? Right? I reckon it might be more than the Chinese have, but just whisper it.”

“There is a tremendous amount of information in testimony provided to various parliamentary committees around the world. Now, I know that sounds awfully anorak, but I'll give you a very important example. By definition, if I'm testifying to a House of Commons o…”

“And when it comes to social media companies, the House of Commons Digital Media Committee has been holding hearings in London and Washington about the role and activities of these social media platforms. And not just because I'm personally interested in it, bu…”

“Are the clients I work with blanket selling US assets? They are not. For the past month and a half, the tactical ones have been increasing their dollar hedge ratios versus various currencies, which is the first step.”

“As you look at the seven big disinflations in the United States since 1951, the end of the Treasury Fed Accord, those big disinflations only occurred unsurprisingly When the real Fed funds rate or predecessor equivalents were notably positive, which makes a lo…”

“The ability to deploy fiscal policy in scale or just fund or socialize losses Depends on your ability to roll over all your sovereign debt at a fairly predictable, fairly low rate. Otherwise, it just doesn't work.”

“All these very good industrial companies in the United States, and some here in the UK who have US businesses, they're going to have a full order book as far as the eye can see as the ripple effects of the Inflation Reduction Act and the accelerated onshoring …”

“There's a whole range of world-class businesses in Japan that have progressively been re-rated, and I would expect that to get more popular. Not just over the remainder of this year, but beyond, particularly if the yen turned around for any reason.”

“That there are tremendous discounts available in secondary markets for UK institutional property funds right now. I won't mention the exact discounts, but I'm just seeing very good appetite, ongoing interest from what I'd call global patient capital to provide…”

“There is so much money in these quantum metal strategies that it's as simple as if implied volatility is coming down for any reason. Then these strategies need to add more risk, and that is exactly what's happening”

“You have no idea what sufficiently restrictive monetary policy is until you are beyond it. That's the tricky thing. And if the Fed is genuine about risk management with regards to inflation, the Fed is incentivized to overdo it.”

“I think in the 10 years to 20 17, Ted, when I looked it up, US shale companies blew through about three hundred billion of capital.”

“And how are politicians going to assist households with that energy shock, which they hope is a one-off? And the answer is probably more fiscal spending. More transfers to households, and that conversation is already underway.”

“Primary dealer balance sheets and large bank balance sheets around the world are necessarily more constrained as a result of what happened in 2008. But also that does rather limit their ability to intermediate markets, even markets as volatile as the ones we'r…”

“The past several years have been all about volatility scaling. All these gigantic multi-strategy businesses, absolute return strategies and others. It's all about volatility scaling. When implied volatility comes down, I have to increase my exposure to keep up…”

“Total, gigantic European energy company, well run, good shape, now one of the world's largest forestry businesses.”

“I find it interesting that so far we're not hearing about the multi multi-billion dollar global ESG absolute return Return fund yet, but I would think it's not far away.”

“At the most basic level, it means we should all pencil in a much lower rate of Chinese trend growth, but that's obvious. So it means that the margin that China's not going to be exporting inflation, they're going to be sort of a curb, if you will, on global gr…”