Gave: Structured Products in Private Banks Create Catastrophic Hidden Downside Leverage
Louis-Vincent Gave · Geopolitical Uncertainty – James Aitken, Louis-Vincent Gave, and Marko Papic (EP.440) · Apr 14, 2025 · at 1:04:10
Gavekal co-founder Louis-Vincent Gave warns about systemic vulnerabilities caused by structured retail investment products sold by global wealth management banks.
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“My fear is that over the past 10 years, private banks all around the world, private banks in Europe, in Asia, in America, Have made a lot of money selling structured products to private clients that essentially the clients where it's selling vault. They sold products where it's like, okay, I tell you, buy Nvidia, but if Nvidia goes down 50%, then you lose all your money. But if Nvidia keeps going up, you make the Nvidia returns plus five percent or something. And the banks have made a lot of money because the fees on all these products were very handsome. So my fear is this, is that you have a lot of private clients around the world today that think they are very wealthy. And in a market adversarial event, it's not that they'll go down 30%, it's that they'll go down hundred percent.”
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