The Vision - October 2019

Welcome to The Vision, your monthly round up of finance news, market insights, and other slices of knowledge I think you might find useful. That’s the criteria… but 3 days is a month in investing right now so we may stray from it occasionally. Click subscribe to be notified of each edition.

The Big Story - Tiananmen to Hong Kong: The Fight for Democracy

The strife in Hong Kong is arguably the most important geopolitical story of the day. It’s critical from a financial standpoint too, with Hong Kong being such a powerful global financial centre. I’m incredibly proud of the team at Real Vision for making this reportage documentary on what’s happening now and what comes next. And I’d like readers of The Vision to see it. So you can watch it for free (yes, absolutely free) on our YouTube channel. (By the way, if you’re interested in more, Tiananmen to Hong Kong is part of a full week of China and Hong Kong analysis over at Real Vision, called China: Danger and Opportunity.)

The Insane World of VCs, Softbank, WeWork, Uber & Lyft

The volcanic blow-up of the proposed IPO of WeWork’s parent, We, makes it the perfect time to revisit this truly remarkable conversation between Josh Wolfe, co-founder and managing partner of Lux Capital and Michael Green of Thiel Macro. This was originally filmed in March for Real Vision subscribers, but we’ve made it available for you to watch for free. And you really should. It’s so prescient that it feels like it could have been filmed last week. So, was the WeWork madness an exception or is there more to come? I’ll leave it for you to decide but here’s what I’ve been saying for some time: SoftBank makes Tesla look uncomplicated and not so risky…

Real Vision Classics: Kyle Bass Interviews Steve Bannon

We’ve just unarchived this interview and released free for the world to watch. No matter what you think of Steve Bannon, it’s important to get as broad a perspective as possible. To me, Bannon is dangerously smart and very right on some things and dangerously crazy and dead wrong on many other things. But to not hear him out? Well, that would just reinforce my biases as opposed to learning. Kyle Bass does a wonderful job here, digging into Chinese infiltration in U.S. institutions, China’s aggressiveness in the South China sea, and the potential for global conflict in the next few years.

Christophe Ollari: Financial QE morphing into Social QE

Christophe is one of the sharpest guys I know, so when he predicts a central banking tilt towards something he’s calling “social QE,” I pay attention. His full Real Vision Expert View interview is available for you to watch for free. Here’s the quote: “Financial QE will not bring anything except it will maybe fuel even more anger and resentment towards the elites, towards the central banks, towards the banking system in general… the move towards social QE is the ECB saying ‘we are buying your debt, spend – into infrastructure, income tax cuts…’” So, could social QE actually benefit the Johnny Public in a way financial QE never did? Answers on a postcard… (or in the comments). 

Thomas Mayer: How to Save the Euro

Thomas Mayer, founder of the Flossbach von Storch Research Institute, is concerned that in the next recession in Europe (which I think we’re already mildly in), the pressures will become so large that the euro will break apart, and the ECB will have to support weaker countries and banks in Italy, Greece, maybe Portugal and more. I’d go a bit further and say that the ECB is going to need to become blatantly political (hello, Christine Lagarde), and going to have to rescue the EU-wide banking system, put the banks into state hands, and force fiscal reforms, massive fiscal stimulus, and tighter EU fiscal consolidation. Thomas thinks the situation could wind up with parallel currencies in Europe; I think it could even end up leaving some countries behind altogether. If you’re interested in Thomas’ take on the euro, and you should be, it’s available to watch here, for free. 

Future Fears: How the Fed Paved the Way to Trump

David Stockman has spent four decades at the nexus of finance and politics. He’s been the ultimate insider as Ronald Reagan’s Director at the Office of Management and Budget, and an establishment pariah for his harsh criticism of the United States’ finances. In this Real Vision video we’ve put on YouTube, he argues that the Fed’s decision to rapidly expand its balance sheet in response to the financial crisis a) fundamentally ruined Wall Street, b) was the biggest financial fraud in human history, and c) paved the way for President Trump.