Q4 and Looking Towards 2023

The Mid-terms . . .

As I write this newsletter, we are still awaiting the outcome of the mid-term elections. Regardless of which party ends up in power, I'm not feeling optimistic about 2023. I'm no economist, but I think that rough times are ahead for middle and working class Americans - they will be "economically challenged" in 2023 and possibly beyond.

The economy and how I think about it post pandemic . . .

The COVID pandemic certainly changed the way we live and work. It has also changed the way that I look at the economy. In recent months there has been much discussion about recession. What's the definition? Are we in one? Instead of looking to numbers and definitions, I've spent time talking to hard working people about their reality - their concerns and fears.

People are talking about the price of gas, the cost of groceries, home heating oil, adjustable rate mortgages, credit card debt, their retirement funds dwindling, the possibility of a diesel shortage, more supply chain issues, an expensive Thanksgiving and a very lean Christmas/Hanukkah. They are being forced to make life decisions that were unimaginable in modern U.S. history pre-pandemic.

Just yesterday . . .

Like many living in rural northeastern Georgia, we have horses. Our farrier came yesterday. As I held each horse for him to trim their hooves we talked about life and politics. He told me that his business is really suffering this year. His regular customers are choosing to feed their horses and neglect their feet. Then he pointed to his pickup truck. He plans to sell it over fear around the diesel supply and needing to be rid of a car payment. Not a pretty picture for a hard-working family man.

The reality of the mid-terms . . .

The polls predicted a "red wave". We ended up with a "red ripple" resulting in a slim republican majority in the House and a debatable outcome in the Senate. As a result, Biden sees November 8th as a victory and an endorsement of his policies. Speaking from the podium on Wednesday, he plans to change "nothing". I predict that more of the same from this administration will produce serious suffering, including the possibility of bankruptcy, for many American households. Having said that, this month, I've heard about the launch of 2 funds focused on bankruptcy claims. Hmmm . . . never let a good crisis go to waste?

So what are investors saying?

As I plan for the December 6th NYC Roundtable Forum, I'm hearing from lots of investors: SFO's, MFO's, RIA's, FoF,'s, etc. All of them are looking for safety and/or a hedge. They want to see credit, CTA's, FX, macro, direct investments, and anything uncorrelated to the markets including VC. Somehow, I'm not surprised by their preferences.

Historically, over 23 years, there has only been one Forum with a theme: "Beating the Bear", and that was after the global financial crisis. As this Forum is coming together I'm definitely sensing a theme. Catering to investors, I always strive for an eclectic and diverse mix of of strategies, but this Forum feels different - very targeted and all about preservation. The schedule of Forum speakers will be out next week. Stay tuned!