They are both right. If you invested like Brian, the market should have tanked by now. Brian wrong. If you invested like Danny, you are up 15% this year until the sh&! hits the fan. Fantastic conversation!!!! Better than Bloomberg! Be civil people.
Canada has seen a higher inflow of immigrants as a percentage. The fact Brian doesn't know this is concerning. Also, both talk about the 10 year and neither one mentioned that the treasury is issuing debt at the short end of the curve to artificially keep the 10 year low. This was called out during Yellens testimony. These guys are supposed to be experts yet they miss key components of what's actually going on.
I’m surprised that Brian was unaware of the extent of (legal) immigration in Canada compared to the U.S. Canada has a serious skills mismatch problem also.
Reaccelerated? As an example, retail sales are up 2% YOY when inflation is way above 2%.... meaning there was actually a a step backwards. The CPI and Unemployment numbers are cooked and food prices have soared. Our President has decided to drain our strategic oil reserves during a time that looks to be a ramp up toward a new world war. There is a serious effort on the world stage to walk away from the USD as the world currency. We have the same financial condition balance problems of inflation vs. interest rates that we did in the late 70s and early 80s, but our politicians are printing money by the ten and hundreds of billions to give away to other countries. Unless an AI Industrial Revolution causes a launch forward, I don't see how anything is looking good other than the pockets of the richest and largest companies.
the inflation is coming from fiscal and energy war. 40% gdp is coming from govt expenditures. so feds keeps raising rate monetary policy wont change the inflation coming from fiscal policy.
right? housing and equity markets are at ATH yet feds increase rates 550 bps in a year with -1.5T QT. so capital markets have become the primary funding for private sector not banking system. so main street may be in recession but wall street and congress are not.
@@Openminder321 nothing is going to stop this train even with higher rates. feds don't want to break the economy to get deflation meanwhile congress and UST DEBT fiscal dominance is exacerbating inflation and congress are not willing to end the wars and spending which is driving GDP. march 2023 SVB regionals is good example. 48 hrs and they have a fresh lending program.feds will never allow deflation.
everyone thinks this is 2008. we dont have a banking crisis. large banks are well funded. we will have a sovereign debt and currency crisis. feds and treasury will do whatever it takes to monetize debt and they need inflation to do it....
The BLS consumer expenditure survey doesn't capture public healthcare which is why it appears consumption declines with age. In fact if you account for all goods and services it is flat. That's why an aging population is inflationary, more consumers and fewer people producing goods and services.
Too bad Brian gets emotional. Kinda degraded the level of the debate. The generalizations about slowing or accelerating aren’t really descriptive or appropriate because different sectors are in completely different phases of growth/deceleration imo. These extreme dispersions are being reflected in the wide dispersion of sector performance
I think Danny is more correct, but his words are confusing: financial conditions is loose so the FED needs more hikes but should not hike, the FED is wrong but in a good place. I think this is exactly what the FED wants because they want soft landing and because of that they probably miss their 2% inflation in near futures, Pow keep tripping on his words because of that facts. Even Danny admits that if FED is sufficiently strictive, things will get blown up so what is the point, lol? Brian gets less credit because he said he is extremely bullish on bonds... nah bonds might be okay for short while.
it is crazy that neither one were talking about treasury bill/coupon issurance ratio manipulation and the consequential decline in ONRRP that drives the supply side of the coupon much lower than market demands. they are stealthy YCC and yet nobody paid attention.
Rates should have been raised one more time at the end of last year. The Fed wants a soft landing and they don't want the stock market to crash before the 2024 elections.
Agreed, I think they will lower by 1/4 in September, (for political reasons) and blast them much higher after the election. No matter who's in the WH at that time we are going to see very hard times, if it's a Demonrat they will blame it on Putin or something else. If it is Trump they will say "look what he did!"
Portugal and Spain have seen deflation in real estate? I don't know what planet you're on, Eric, but the price of housing in Lisbon and other large Spanish cities has increased exponentially. Furthermore, I have been in Portugal, Spain, France, Slovenia and Croatia this year and you simply cannot find even short-term stays that are affordable. To give you an example of Lisbon, the statistics point to a 20% increase in rents, but you simply cannot rent the apartment I was renting in 2016 for less than double. A friend of mine bought an apartment and sold it for literally double the value in less than 5 years too.
Both effects can be seen. In Southern Europe it seems to be the rural areas and small villages that depopule forst. Larger cities are immune and have seen price growth continue The same happened in Japan because depopulation does not occur evenly in geographic terms.
@@thomas316 in Southern France and anywhere in the world for that matter. If there's supply and no demand, prices adjust down. There are nearly abandoned villages in Italy where they pretty much offer you residence if you rehabilitate the house and move there. Villages where tens of people live. That says nothing of the reality of housing nor the serious problem of affordability throughout the continent.
Fantastic content. Something that I love about business cycles and overall macro economics is the phenomenon that most economic trends are created by belief. Seeing this debate fuels two opposing ideas and I just love it. Full of good data points. Really enjoyable.
What about someone who thinks we need a major recession to reset the economy and allow the zombies in the economy to be weeded out. Not allowing the market to properly reset the past few recessions, ie saving companies, has kept those at the top there while keeping the people at the bottom at the bottom. If you want class mobility the government needs to allow people to fail so others can move in to take their place.
While what you are saying is 100% necessary for the market's proper organic functioning, we must account for the fact that the median voter does NOT want a deflationary shock: corporate defaults, unemployment, foreclosures, bankruptcy filings, etc. Ergo, the median politician will avoid it at all cost by money printing, Fed put, liquidity injections, fiscal support, etc. In short: There is no way that society will accept a *much needed* deflationary shock, so there is no way that Washington will let it happen.
Many companies are failing and filing for bankruptcy due to the inability to pay back debt/refinance their debt. The zombie companies are busting but as it should be it’s going slow. A large shock to these companies going down will be far worse for the average person. Also class mobility is a fraught myth. Most people maintain the class they were born into. Exceptions are just that exceptions but generally speaking having companies fail won’t increase class mobility. Equity to opportunities will however. Unfortunately upper classes have more leverage when failing and they tend to fail upward or maintain their class while the lower class cannot afford to fail as they don’t have as many resources.
@@HectorYagueto be fair fed support is not the issue when they are supporting necessary infrustrating projects that create jobs and put money into the economy. It’s wasteful spending as in money going to the defense contractors pockets that account for bad spending. The fdr new deal helped Americans in a time of need and it was a massive sum of money being printed. But the money had use and was circulated. We need more of that unlike the covid stimulus that was siphoned to the top 1%
in my ski town the market is very slow all the sudden. people are expecting rates to fall. but even if they do it wont be wnough to make a difference. only suckers buying right now.
good talk. like to hear someone arguing that the fed is too loose at this stage. hear no one taking this point in msm. i had the same opinion (too loose) last few years and went long stocks to a very nice return. i see that M2 is ticking up again so difficult to say where we go from here but last two years was easy pickings in the stock market if you didn't listen to the 'experts'
I completely agree with Brian. The forward trends are absolutely deflationary. Inflation is money, which is completely different than relative price acceleration.
lol, regardless who is right who is wrong, Brian definitely missed the rally and Danny is so chill because he is in a good position for now. Who knows what's gonna happen in the future, the record of any particular economists or macro investors are so unreliable that it makes no sense to make any investment decision based on the forecast.
Love your content, keep on going. But a kind recommendation to ask your hosts to submit a headshot and have your marketing team create a more flattering video thumbnail for your guests (PS: you should be included on it too, we like you more than we like your guests)
How do you have a debate about inflation without discussing the money supply? The money supply increased by 50% in 2 years and it is rising again after contracting.
Feds should have raised rates way more in 2024 but they were pressured by banks not to because of banks risk of failing. Now the dollar is monopoly money.
I keep hearing talk about jobs increasing in the US, but I have friends in Silcon Valley, Pacific North west, Philidelphia, Miami and Fort Worth....and all of them say unless your looking for a job making 15 an hour your not getting a job in the US. ANyone who loses their job is out of the market period. They arent buying stock, they arent buying squshmellows or video games, they arent buying homes or cars....they ar paying rent and buying food and thats it. The longer this goes on, the more the FED gets confused because this countries citizens are dropping from upper class to poor in 2 years every 2 years and eventually between AI and outsoursing (btw outsoucing still counts as new US jobs) the economy just has bunkruptsy after bankruptsy with inflation and the FED sits there all confused cause he doesnt understand why with high unemployment nobody has any money......Let them eat cake I suppose, idiots.
I would love to spend almost 2 hours watching this video of 3 guys shooting the breeze but in the preview, I see two people talking over each other like animals and I will not spend any time trying to parse out two grown adults interrupting over things that are unknowable and ultimately not synthetically reductive to the Informative content of the viewer. I got it. You’ve got different opinions on things, but in the end, I only care about the summation of the analysis. And I will not spend two hours trying to glean that out of this.
The thing that upsets me most? That these fund managers, while they spar publicly about indicators and/or some industry's performance, are in fact using very expensive and advanced AI programs that buy and sell stocks at blinding speeds with one purpose. Making money. The stock market no longer has any real meaning and is set up to drain the average investor of every dime it can. In my mind, the rules for high speed trading should have stiff penalties, and all money collected should be treated much like lottery taxes. It should go to improving the very infrastructure of the country that provides the playground for these goliaths in the form of roads, bridges, power grids, college educations and US manufacturing.
Sorry bears. You've been wrong for years. Maybe logic and history says you should've been right.. but you haven't. When a person comes along and tries to break down on why.. you don't need to belittle or argue with them. Stop with all the "what ifs."
Calling the Canadian and US economies identical is a grave misunderstanding of the critical differences of Canadian society and markets.
That bear vs bull cage match at the beginning made me laugh at how relatable my thinking is right now
Debate? 1 guy constantly yelling over the other with no moderation? The lack of mutual respect and format issues took away from the points made.
They are both right. If you invested like Brian, the market should have tanked by now. Brian wrong. If you invested like Danny, you are up 15% this year until the sh&! hits the fan. Fantastic conversation!!!! Better than Bloomberg! Be civil people.
Couldn't agree more
Home price numbers are deceiving. Sure, the high end ones are dropping. But starter homes are rising dramatically.
Canada has seen a higher inflow of immigrants as a percentage. The fact Brian doesn't know this is concerning. Also, both talk about the 10 year and neither one mentioned that the treasury is issuing debt at the short end of the curve to artificially keep the 10 year low. This was called out during Yellens testimony. These guys are supposed to be experts yet they miss key components of what's actually going on.
Its not concerning, it's completely normal for people in the US to know nothing about the world outside their borders.
@@JorgeOrpinel truth, but Yellen manipulating the yield curve is right here at home.
We've had way too many immigrants come here in Canada. It's so obvious that it's causing houses to go up in value. The demand is too strong.
I’m surprised that Brian was unaware of the extent of (legal) immigration in Canada compared to the U.S. Canada has a serious skills mismatch problem also.
Reaccelerated? As an example, retail sales are up 2% YOY when inflation is way above 2%.... meaning there was actually a a step backwards. The CPI and Unemployment numbers are cooked and food prices have soared. Our President has decided to drain our strategic oil reserves during a time that looks to be a ramp up toward a new world war. There is a serious effort on the world stage to walk away from the USD as the world currency. We have the same financial condition balance problems of inflation vs. interest rates that we did in the late 70s and early 80s, but our politicians are printing money by the ten and hundreds of billions to give away to other countries. Unless an AI Industrial Revolution causes a launch forward, I don't see how anything is looking good other than the pockets of the richest and largest companies.
the inflation is coming from fiscal and energy war. 40% gdp is coming from govt expenditures. so feds keeps raising rate monetary policy wont change the inflation coming from fiscal policy.
right? housing and equity markets are at ATH yet feds increase rates 550 bps in a year with -1.5T QT. so capital markets have become the primary funding for private sector not banking system. so main street may be in recession but wall street and congress are not.
@@bitcoindaddy1 Bingo. Private equity is taking over traditional lending's role, no one has questioned why.
@@Openminder321 nothing is going to stop this train even with higher rates. feds don't want to break the economy to get deflation meanwhile congress and UST DEBT fiscal dominance is exacerbating inflation and congress are not willing to end the wars and spending which is driving GDP.
march 2023 SVB regionals is good example. 48 hrs and they have a fresh lending program.feds will never allow deflation.
everyone thinks this is 2008. we dont have a banking crisis. large banks are well funded. we will have a sovereign debt and currency crisis. feds and treasury will do whatever it takes to monetize debt and they need inflation to do it....
The BLS consumer expenditure survey doesn't capture public healthcare which is why it appears consumption declines with age. In fact if you account for all goods and services it is flat. That's why an aging population is inflationary, more consumers and fewer people producing goods and services.
Too bad Brian gets emotional. Kinda degraded the level of the debate. The generalizations about slowing or accelerating aren’t really descriptive or appropriate because different sectors are in completely different phases of growth/deceleration imo. These extreme dispersions are being reflected in the wide dispersion of sector performance
I think Danny is more correct, but his words are confusing: financial conditions is loose so the FED needs more hikes but should not hike, the FED is wrong but in a good place. I think this is exactly what the FED wants because they want soft landing and because of that they probably miss their 2% inflation in near futures, Pow keep tripping on his words because of that facts. Even Danny admits that if FED is sufficiently strictive, things will get blown up so what is the point, lol? Brian gets less credit because he said he is extremely bullish on bonds... nah bonds might be okay for short while.
Thanks Eric. One of the best debates on CZcams. It is not who is right or wrong but perspective.
Danny is the kinda guy who told you the market was hot back in 07
The market was hot back in 07. A lot of people made good money and a lot more lost money and their lives in 07 :)
Haha. To add to your comment cabon, Danny was the guy who said in 07 that it was the start of a new bull market 😂
@@MjV-jd2lo investing is about pricing in the future, you don't invest at the top because the market is hot you know :)
@@carbonfibercrypto2919 you're making too much sense for a average Wallstreetbet trader guy like me.
If Danny's portfolio is the s&p 500, Danny is 15% richer than Brian. Or if you invest like Brian, you are 15% poorer. Who is right?
I love all kinds of debates, thanks for organizing this.
Really enjoyed this, very meaty debate. Good points by all parties, everybody contributed, really thought provoking.
Danny did a wonderful job articulating his points based on data that makes intuitive sense. I can't help but agree with Danny on so many points.
and both people are focusing on fed whereas in fact the true central bank is the combination of fed + treasury. that explains alot of your confusions
it is crazy that neither one were talking about treasury bill/coupon issurance ratio manipulation and the consequential decline in ONRRP that drives the supply side of the coupon much lower than market demands. they are stealthy YCC and yet nobody paid attention.
Grreat discussion,. Thanks Eric. I learnt so much from all three of you.
Rates should have been raised one more time at the end of last year. The Fed wants a soft landing and they don't want the stock market to crash before the 2024 elections.
Agreed, I think they will lower by 1/4 in September, (for political reasons) and blast them much higher after the election. No matter who's in the WH at that time we are going to see very hard times, if it's a Demonrat they will blame it on Putin or something else. If it is Trump they will say "look what he did!"
Portugal and Spain have seen deflation in real estate? I don't know what planet you're on, Eric, but the price of housing in Lisbon and other large Spanish cities has increased exponentially. Furthermore, I have been in Portugal, Spain, France, Slovenia and Croatia this year and you simply cannot find even short-term stays that are affordable.
To give you an example of Lisbon, the statistics point to a 20% increase in rents, but you simply cannot rent the apartment I was renting in 2016 for less than double. A friend of mine bought an apartment and sold it for literally double the value in less than 5 years too.
Both effects can be seen. In Southern Europe it seems to be the rural areas and small villages that depopule forst. Larger cities are immune and have seen price growth continue
The same happened in Japan because depopulation does not occur evenly in geographic terms.
@@thomas316 in Southern France and anywhere in the world for that matter. If there's supply and no demand, prices adjust down. There are nearly abandoned villages in Italy where they pretty much offer you residence if you rehabilitate the house and move there. Villages where tens of people live. That says nothing of the reality of housing nor the serious problem of affordability throughout the continent.
Love these podcast style vids keep em up
Home prices go up forever. Everybody knows that. We knew that in Ireland way back in 2006, before average prices dropped by 55% between 2008 and 2013.
Fantastic content. Something that I love about business cycles and overall macro economics is the phenomenon that most economic trends are created by belief. Seeing this debate fuels two opposing ideas and I just love it. Full of good data points. Really enjoyable.
What about someone who thinks we need a major recession to reset the economy and allow the zombies in the economy to be weeded out. Not allowing the market to properly reset the past few recessions, ie saving companies, has kept those at the top there while keeping the people at the bottom at the bottom. If you want class mobility the government needs to allow people to fail so others can move in to take their place.
While what you are saying is 100% necessary for the market's proper organic functioning, we must account for the fact that the median voter does NOT want a deflationary shock: corporate defaults, unemployment, foreclosures, bankruptcy filings, etc. Ergo, the median politician will avoid it at all cost by money printing, Fed put, liquidity injections, fiscal support, etc.
In short: There is no way that society will accept a *much needed* deflationary shock, so there is no way that Washington will let it happen.
Many companies are failing and filing for bankruptcy due to the inability to pay back debt/refinance their debt. The zombie companies are busting but as it should be it’s going slow. A large shock to these companies going down will be far worse for the average person.
Also class mobility is a fraught myth. Most people maintain the class they were born into. Exceptions are just that exceptions but generally speaking having companies fail won’t increase class mobility. Equity to opportunities will however. Unfortunately upper classes have more leverage when failing and they tend to fail upward or maintain their class while the lower class cannot afford to fail as they don’t have as many resources.
@@HectorYagueto be fair fed support is not the issue when they are supporting necessary infrustrating projects that create jobs and put money into the economy. It’s wasteful spending as in money going to the defense contractors pockets that account for bad spending. The fdr new deal helped Americans in a time of need and it was a massive sum of money being printed. But the money had use and was circulated. We need more of that unlike the covid stimulus that was siphoned to the top 1%
in my ski town the market is very slow all the sudden. people are expecting rates to fall. but even if they do it wont be wnough to make a difference. only suckers buying right now.
This debate is needed, thank you.
good talk. like to hear someone arguing that the fed is too loose at this stage. hear no one taking this point in msm.
i had the same opinion (too loose) last few years and went long stocks to a very nice return.
i see that M2 is ticking up again so difficult to say where we go from here but last two years was easy pickings in the stock market if you didn't listen to the 'experts'
Haven’t watched yet, but I am excited to after the last one! Wanted to comment to give a bump for the algorithm. Thanks again for the great content!
I completely agree with Brian. The forward trends are absolutely deflationary. Inflation is money, which is completely different than relative price acceleration.
lol, regardless who is right who is wrong, Brian definitely missed the rally and Danny is so chill because he is in a good position for now. Who knows what's gonna happen in the future, the record of any particular economists or macro investors are so unreliable that it makes no sense to make any investment decision based on the forecast.
Love your content, keep on going. But a kind recommendation to ask your hosts to submit a headshot and have your marketing team create a more flattering video thumbnail for your guests (PS: you should be included on it too, we like you more than we like your guests)
These guys hate each other and I'm here for it!
This conversation sounds juicy. I can't wait.
Something going on? Maybe, too much money looking in a restricted supply of investments causes asset bubbles?
I'm leaning towards Brian McCarthy being right
Agreed. He brought more data to his points in my opinion.
The only thing that matters is what the people holding most of the money think is going to happen
The guy talking about the economy accelerating is lost in the sauce. Stocks are the last thing to break. That ideology is crazy.
How do you have a debate about inflation without discussing the money supply? The money supply increased by 50% in 2 years and it is rising again after contracting.
"The stock market just keeps going up" --- Mike Green's 'big mindless robot' or the passive bid funneling into the world's favorite stock market.
Brian needs less caffeine
Feds should have raised rates way more in 2024 but they were pressured by banks not to because of banks risk of failing. Now the dollar is monopoly money.
Great stuff!
we are all standing on one leg to see what the f the fed is doing
I just spoke with a Canadian client who said the same on migration.
The debate was over when Danny opened with, "It's different this time."
How about the coming weather transfer? How much healthcare are 75 and 80 year olds going to “consume? Off the charts.
Lot of "Recession only" talk on channel
Brian is a monetarist and will never understand what Danny has to say here. Too emotional for his age and too thin skinned for this industry.
Stock market is the last one to be bearish but first to be bullish. Nothing else.
Wealth.
Gme, amc, cryptobros are back. That means financial conditin is not just tight.
Walker Anthony Johnson Ruth Gonzalez Brian
One last thing, does this guy know the savings rate is negative? Savings is being drained rapidly.
Both are wrong and McCarthy is just stupid. The yeild curve is already inverted so the tool for controlling liquidity/FCI is QE/QT, NOT cuts/hikes.
Lopez Michelle Moore Daniel Wilson Charles
Lopez John Clark Timothy Lewis Carol
Guest points aside
Brian is a rude whiner
Jones Joseph Anderson Linda Brown Nancy
I keep hearing talk about jobs increasing in the US, but I have friends in Silcon Valley, Pacific North west, Philidelphia, Miami and Fort Worth....and all of them say unless your looking for a job making 15 an hour your not getting a job in the US. ANyone who loses their job is out of the market period. They arent buying stock, they arent buying squshmellows or video games, they arent buying homes or cars....they ar paying rent and buying food and thats it. The longer this goes on, the more the FED gets confused because this countries citizens are dropping from upper class to poor in 2 years every 2 years and eventually between AI and outsoursing (btw outsoucing still counts as new US jobs) the economy just has bunkruptsy after bankruptsy with inflation and the FED sits there all confused cause he doesnt understand why with high unemployment nobody has any money......Let them eat cake I suppose, idiots.
Walker Betty Martinez Frank Robinson Steven
I would love to spend almost 2 hours watching this video of 3 guys shooting the breeze but in the preview, I see two people talking over each other like animals and I will not spend any time trying to parse out two grown adults interrupting over things that are unknowable and ultimately not synthetically reductive to the Informative content of the viewer. I got it. You’ve got different opinions on things, but in the end, I only care about the summation of the analysis. And I will not spend two hours trying to glean that out of this.
Watched the preview. This looks spicy! On list to watch tonight at the gym!
In my opinion, they will leave interest rate as is and will raise the the last interest rate to achieve maximum votes for Biden.
Danny is just a stereotypical perma Bear. No facts only emotions, and ego behind all of his opinions
The thing that upsets me most? That these fund managers, while they spar publicly about indicators and/or some industry's performance, are in fact using very expensive and advanced AI programs that buy and sell stocks at blinding speeds with one purpose. Making money. The stock market no longer has any real meaning and is set up to drain the average investor of every dime it can. In my mind, the rules for high speed trading should have stiff penalties, and all money collected should be treated much like lottery taxes. It should go to improving the very infrastructure of the country that provides the playground for these goliaths in the form of roads, bridges, power grids, college educations and US manufacturing.
YAY communism, where YOU get to tell OTHER people how to spend/invest THEIR money based on YOUR believes. Yeah thanks, but no thanks.
Sorry bears. You've been wrong for years. Maybe logic and history says you should've been right.. but you haven't. When a person comes along and tries to break down on why.. you don't need to belittle or argue with them. Stop with all the "what ifs."
only watched 50 seconds and the guy on the right is crazy to think a number in a spreadsheet is the value of something.
Get rid of the Fed!!!