The Ledger, every show

“We now have an administration sending a very direct message over and over again to global capital. And I paraphrase, please go away.”

“I'll just say generally that the right size exposure to renminbi assets is zero, and perhaps that's something we should take up in another conversation ahead of the Taiwanese presidential elections.”

“The idea that ETFs were ever a self-liquifying instrument, that is to say that ETFs create liquidity in their underlying reference securities was always just buy-side propaganda. Absolute garbage. And to see dozens and dozens and dozens and dozens Of credit an…”

“The key assumption Underpinning economic and monetary union. In fact, to this day, there's no default risk in peripheral credit of all kinds, whether it be sovereign or bank or whatever. And Ted, the Germans thought, here's an opportunity to teach everyone a l…”

“Secular stagnation is a euphemism for policy failure, meaning that secular stagnation is a choice.”

“The reality is that we're going to have two quarters of global growth that are going to be absolutely horrible. And in that context, the market clearing price of earnings, and therefore the market clearing price of equities in general, in the US in particular,…”

“It is not the treasury basis trade unwinding. The treasury basis trade this week has been fine. The treasury basis trade does not explain what happened.”

“Nor, as Louis would attest, does the convenient but incorrect rumor that, oh, China must be bashing treasuries. Just ignore that.”

“There is not enough private sector balance sheet capacity to intermediate this enormous stock of treasuries. It's a capacity problem.”

“During this transition, however long it is, we'd be more surprised if we didn't start to read more stories about private something being under pressure. More stories about people who didn't read the prospectus and tried to get the money out and they couldn't a…”

“The pass-through effect this time, if the Fed's going to succeed in bringing inflation down back to target levels, it's going to have to be more persistent and more hawkish, I would argue, than any of us have experienced.”

“And there is no overstating the profound impact of this Inflation Reduction Act. It is just starting to be felt. It seems every marginal dollar of Western capex coming into the United States, because the tax subsidies are so generous, Not to mention all the sk…”

“So successful has this bailout been so generous That they're probably going to end up taking the Fed funds rate to a level that none of them actually imagined when they started 2023.”

“Who's going to buy all these bonds that the United States is selling in 2023, 20 24, 2025 with a rising budget deficit before the recession comes? And my answer is everybody. Everybody. You give people the right incentive, the right coupon, they will buy it.”

“This is the sort of industrial capex you normally only see in wartime.”

“And yet the facts are that if you and I, Ted, decide we're going to buy some listed asset today, well, we're going to be five to 10% of the turnover. Because the way the world works today is that the flow is dominated by the machines, and that's not a criticis…”

“There's more and more money coming in as volatility comes down into the most liquid stocks. But then at some point, that's all going to turn around. We don't know when. But boy, oh boy, that's going to be a lively couple of days when that happens.”

“First and foremost, those are the ones that are going to struggle. It's those profitless companies, no matter what their line of business. And then they've been unable to refinance to this point. Boy, oh boy, it's going to be a brutal period ahead.”

“If one takes the belligerent pronouncements Of European politicians and policymakers at face value, it seems that in an effort to thwart Mr. Putin, Europe is prepared to tolerate a recession, or at least something that looks awfully like a textbook definition …”

“So to me, it's not the official sanctions that are driving the turbulence under the surface of commodity markets in particular. It's the eagerness of private sector financial institutions and banks in particular To self-sanction, lest they inadvertently releas…”

“Unless oil and gas companies are given unambiguous political cover to expand CapEx once more in the naughty stuff, the non-renewables, then I'm afraid it's difficult to imagine a rapid solution To the energy supply bottlenecks that we're all seeing right now, …”

“That over the next several years, average inflation would turn out to be higher than in at least the 10 years prior to say, twenty-twenty. That would be my best guess.”

“So I don't think there's any immediate Re-appraisal of the REM NIMBY as a global reserve asset, and we start to see colossal flows into it, or should I say accelerated inflows out of dollars and euros into REM NIMBY. I'm not convinced.”

“And if you wanted to give those running US sanctions or European sanctions an opportunity to crack down on crypto markets, then that would be it. Either encourage or facilitate large inflows into crypto, or coins I should say, from people who might Be on the s…”

“Look, I don't know, Ted, but I think the ramifications of what's just happened in terms of sanctions, the speed with which these sanctions have been put together, and what it means for asset allocators worldwide, I don't think we'll fully understand for some t…”

“Suffice to say, I would imagine that portfolios that continue to be structurally turned towards commodity and resources are going to do well, because I think we're probably on the front edge of a sustained period of commodities nationalism, which serves to bro…”

“The cool eye of financial history might conclude that by driving interest rates to ridiculously low levels, while simultaneously driving financial intermediation out of prudentially regulated banks, We or policymakers perhaps effectively uncapped leverage in t…”

“Volatility scaling, or the assumption of volatility scaling, I think had a large hand in the disruption we've seen, and just to finish this point, there was a marvelous article written in the autumn of 1987 by an extraordinary Chicago trader called Richard Den…”

“And then, surprisingly for a lot of people, what promulgated the colossal unwind of all these RV positions was the Fed cutting those 50 basis points the other week out of the blue.”

“We're going to have interest rates at very low levels. We're probably going to have some element of yield curve control in the United States. I don't know yet, but some element of asset purchases are going to be semi-permanent from the Fed, which probably serv…”

“Over the past 12 years, we have, as intended, transferred all the risk to non-bank financial institutions. So the risk is now in non-bank financial institutions and often in vehicles that own illiquid assets with daily liquidity, which is absolutely absurd.”

“If I'm an allocator to a particularly large buy side firm, and I say to myself, gosh, I can't redeem, but how do I justify to my superiors that I've done my best to hedge? I start shorting that stock. And I know it's absurd, but I've actually seen it happen ov…”

“The cost of capital for non-renewable businesses is going to go up, and the cost of capital for renewable businesses is going to go down, and obviously, Ted, in a low interest rate world, the multiplier effect of that is going to be profound, because the re-ra…”

“I think there's a good chance that we have the bare bones of a deal, if you will, about the future relationship between the United Kingdom and the European Union. I think we have the bare bones of a deal by the summer.”

“If the past two and a half years is a rough guide on the ability of Chinese financial officials to pull this all off, you would bet with them, not against them.”

“The trade war is not easy to resolve. We've probably got it what I think of as a phase 0.5 deal. The bare minimum coming very soon. A bigly good signing ceremony and, you know, the usual circus and theater as we come to expect. But the rest of it's impossible …”

“How Japanese institutions are lending their dollars in a much greater scale, which is lubricating global money markets and increasing the float of dollars.”

“There's an obvious feedback loop between post-crisis regulation and what central banks have been trying to do. In fact, you might argue they're at cross purposes.”

“The stock is still rising, and perhaps I'm being simplistic, but I don't see how you ever deflate what is frankly a gigantic liquidity bubble rolling from asset class to asset class inside China without some pretty stern consequences for Chinese GDP. And that'…”

“So we're told for years that all these Chinese property companies and Chinese corporations are borrowed in dollars. If the dollar goes up and the Fed tightens policy, they're in, in a world of pain. And this young man managing a Chinese bank balance sheet in B…”

“At 300 over Bunz, effectively, that is implying, I mean, this is subjective, but effectively implying a 30% probability of some kind of re-denomination or tactical default in Italy.”

“I think the number one risk is the assumption that long-term interest rates can only go down. That's the number one risk. That underpins, I think, Nearly every major asset allocation around the world. The assumption that we are perpetually mired in some sort o…”

“So Fed funds doesn't get to 525 basis points like it did in O six. It gets to something like, oh, let's say, 300, which I think would surprise some people if we got there, but that's where I think it's the minimum.”

“Even if this weekend we get big, beautiful tariff trade negotiations with Japan and South Korea and maybe some others, it's too late. To arrest the jolt to confidence, the jolt to capex, the jolt to business spending, the jolt that will soon start to impact co…”

“When Scott eventually gets to deregulation and freeing up some of the constraints in the leverage ratio, it should serve to dramatically improve the functioning of the treasury market, and that would be a good thing.”

“It's been a very remarkable three years and a very remarkable 18 months, because I don't think any of us would have imagined that in the context of the most rapid rate hikes any of us have experienced, that the fallout of that could be so limited.”

“I'm afraid what that has probably done is reset expectations of what fiscal policy can do and how it can be deployed in future downturns. So now it's out of the box. Fiscal policy is probably going to be more proactive and generally stimulative. And that makes…”

“And then when we compare Historical episodes of US households being overextended, not just with mortgages, but with credit cards and everything else. They're in very good shape compared to any time, certainly in the past 20 years in terms of credit card borrow…”