Jun.29 -- Hugh Hendry, global macro adviser, discusses his latest report, "The Dawn of Chaos." He speaks with Bloomberg's Jonathan Ferro on "Bloomberg The Open."
It's also what you might look like when you are a hedge fund founder but you dare to think creatively and independently vs. spewing the usual hyper-partisan, coordinated and reptilian lies to gather assets your whole career. This is not to say that he didn't under perform or isn't enjoying his retirement in St. Barth's and/or perhaps a bit too much. But the world doesn't need another "objective" bully or CPA Level III "seeking alpha". Best wishes to Hugh.
Good to hear a finance guy who understands the dangers of society snapping due to the inequality of the current monetary agreements. When social order breaks down due to obvious inequities, it won't matter how much money is in your account.
I've listened to Hugh talk to Rao Paul of Real Vision, and the guy is kind of off his rocker. I'd take this all with a grain of salt. As an aside, the reason low rates and QE isn't stimulative is at some point, banks don't want to lend when their cost of capital is greater than their return of capital. By lending, they would be losing money. That's basically what's going on in Japan.
Chaos could be achieved simply by the cessation of QE globally and letting interest rates be determined by market forces. In the present circumstances, governments and central banks will avoid this scenario at all costs. take care Robert W. M'cCoy
This was the rational approach 30 years ago. Housing would be affordable. College would be affordable. Rents would be affordable. All of this would make the bottom 50% a low wealthier in real terms than today. Retirees would not have to be unwilling leveraged landlords (pushing real estate prices even higher) and stock market speculators into their 70s. Now we are too far gone. Imagine the 10 year at 6 or 7% the USA would be bankrupt.
An absolutely great book....the 4th turning. What if all High School seniors in the United States or all college business students were required to read it? Would our world be better or worse off?
As they say, those on the bottom usually benefit from projecting higher status and those on the top benefit from hiding their status and projecting lower image.
You'll be proven wrong. The only reason he can put forward this argument is the dollar is the reserve currency, pure and simple. Just give it 5 to 10 years.
Great Hugh but I need macro for beginners so I don't have to watch over and over to understand some of what was discussed any recommendations for beginners
"I need macro for beginners so I don't have to watch over and over to understand some of what was discussed any recommendations for beginners" - Great Question! As someone who has been self employed since the 1970's, I have been trying to understand macro since the 81-82 recession because my life has depended on it. For what it is worth, the pearl from this video for me, one that you can "take to the bank", comes at 8 minutes and 20 seconds, when "Great Hugh" states that the tidal change from deflation to inflation will be marked by a simultaneous rise in stock prices AND the volitility index; see fred.stlouisfed.org/graph/?g=tt7Q this is a federal reserve link that I just now created to graph the S&P 500 and the CBOE Volatility Index: VIX. Note anyone can use the Fed's charting system to see macro relationships. Thomas
jojo90 S - I would enjoy hearing more of your questions.
Everybody fears deflation and want some inflation. Well, be careful what you wish for, because you might just get it. Inflation is not the panacea everybody think it is. Inflation is not necessarily associated with growth, as we have seen during the 70's. There is a huge difference between the Fed printing money and giving it to the banks who are basically just sitting on it, or diverting it to the stock market, and the Fed printing money and handing it to the treasury, which is handing out checks to people, so they can go out and spend. The former had no impact on velocity, the latter will.
So I bought a bottle of Powerade the other day for about a buck. It used to be 32 ounces. Now it is 28ounces. This is how manufacturers deal with inflation. They don't raise the price they just give you less.
Can someone here explain to me, he said "Fed is not printing money, it's increasing central bank reserves" Does he mean the liquidity the US Fed injects into US banks eventually all end up in Central Banks of major countries like EU, Japan and China? The US eventually exports its domestic inflation, that doesn't mean there isn't inflation right? I mean just because US economy can absorb the inflation, dollar inflation still adds to other countries' domestic inflation... Or am I not getting what Hendry is saying?
The printing of money (quantitative easing) does not necessarily result in inflation. The Chicago Monetarist theory was always a bit flaky. Inflation is solely caused by demand exceeding supply and in the Covid19 world we have now with mass unemployment, demand will be very low.
he does have a point. The Fed can't keep up the status quo for much longer. The bull market will continue for 2-3 years but with asset price inflation leaving Main Street behind, something will have to give..........We just don't know what.
The trick is to try and increase the velocity of money. The price is irrelevant as long as its kinda stable. You want the people in the economy to be busy earning and spending, not saving and waiting.
He is correct. Treasury is cooking the books when they started to promise to buy everything just to hold up the market. So u can just buy any damn stock and I still can profit from it 😂
QE and printing will not cause inflation as long as it doesn't trickle down. As income gap increases, deflation will increase as people are left with less money to buy the produced goods and services.
Agree. The printing of money (quantitative easing) does not necessarily result in inflation. The Chicago Monetarist theory was always a bit flaky. Inflation is solely caused by demand exceeding supply and in the Covid19 world we have now with mass unemployment, demand will be very low.
Inflation comes after the bust. BUT since we're talking about modern america, middle and lower class will not see the uptick, and maybe inflation won't happen because, despite covid being defeated (someday), the average american won't even tell the difference. Happened 10 years ago, might happen again.
Living on the Pacific Northwest waterfront where one of the strongest of public waterway advocates reside...the government here turned management of the seaside to a private agency to decide how the public mandate is enforced. This became the way for the waterfront to be chopped up into hotels, condos, and restaurants without public scrutiny and citizen comments. This is also how the Federal Reserve operates without comment from the people.
A few years ago, i watched an interview with Marc Cuban in which he said something that i thought was totally crazy at the time.......he said that future business leaders and top entrepreneurs would be well versed in Liberal Arts (i took it as eccentric mind set). After studying many interviews with Charlie Munger and this Hugh Hendry.........i think i am understanding Mr. Cubans comment. We need Cuban as a presidential candidate. If not in 2020, in 2024.
Another piece of this puzzle is technology is highly deflationary, this offsets the areas of the economy that are inflationary. For example 20 years ago I needed to buy a map in order to get to where I wanted to go if I went to a new town. Now I just use Google Maps which is free. A lot of this is missed by the main streeters. People like hugh hendry understand it so well intuitively, they do not discuss it in interviews like this. When is the last time you bought a map? How much money do you or your family spend yearly on screen Time Entertainment versus 20 years ago? Huge deflationary factors with technology. The flip side is Healthcare is going up 15 to 20% or more depending on where you live each year.
Inflation is not under control, it's at all time highs, it's just not in the consumer goods prices ..... It's the asset prices that are inflated.... Raise interest rates, and watch everything go back to normal.
After hearing Hugh's reasoning I have to say he may be on to something. We may very well have been looking through the wrong end of the telescope. the Fed has already printed a hell of a lot of money. Why hasn't gold gone through the roof? His contention is that the Fed has increased the money supply. Inflation is not a result of interest rates but how much money is out there. His contention is that the Fed should churn out way more to get the economy back on track. He may be right.
Chaos is natural, and when you try to suppress it it will only come out as a bigger chaos. They say the road to hell is paved with good intentions or the other version where hell is full of good meanings, but heaven is full of good works.
So the FED buying up assets and having a balance sheet to infinity all while artificially lowering rates (no rational person would lend the US government money at no return) is bringing prosperity to the average person?
So our society remains together ? Man what Planet do you come from ? My Aussie Society has been totally divided my entire life ! We call it Multi Culture . which is them against us .
just a perma bear that never understood the effect of QE on asset prices, especially equities. sad. his performance was dire bar 2008. i hope his mental health has improved and stays positive.
Wow, rubbish, this guy is very misguided. The FED literally created dollars in the system no matter what way you think about it. They had to create the dollars or bonds and trade them into stocks and other bonds, the point is that they are inflating. They did not create value. Of course you see the inflation in the USD chart last, just like you see the US economy turn into just two classes last. The cost of living going up 3x compared to wages is the best metric I think. The bailouts go to the monoplolys which run everything including the banks and infinite supply of money and who gets elected indirectly by funding their candidates infinitely. Just #buybitcoin and quit trying to think so much pal
Well that was clear. Two cups of bluster, a pait of designer glasses and a pinch of Joe Rogan. How illuminating. Why try to calculate whether the Fed has printed money? For a start, the term "printed money" is ambiguous, but aside from that what does the Fed say about it? And WTF is quantitative easing if it's not "printing money"?
But then wouldn't that cause the dollar to lose the credibility for safe haven n increase the force against dollar as a reserved currency as China and many other countries have been trying to change?
![How Did The Wealthy Gain Power In The Past? - Yuval Noah Harari [2015] | Intelligence Squared](http://i.ytimg.com/vi/TYAKHLrr51w/mqdefault.jpg)
what you look like when you "Fight the Fed" your whole career
😂 👌 💯
It's also what you might look like when you are a hedge fund founder but you dare to think creatively and independently vs. spewing the usual hyper-partisan, coordinated and reptilian lies to gather assets your whole career. This is not to say that he didn't under perform or isn't enjoying his retirement in St. Barth's and/or perhaps a bit too much. But the world doesn't need another "objective" bully or CPA Level III "seeking alpha". Best wishes to Hugh.
Carlton Cotter just a light hearted joke. much respect to the main for going against the grain.
That's hilarious
muahahahah- very nice one-liner !!!!!!!!!!!!!!!!!!
I'd like to see Hugh and Bono fight. With pool noodles. And a lot of alcohol.
I love this guy! So amazing to watch and listen too! Have him on again! Entertaining and enlightening!!!!
This guy needs his own advisor to lay off the drugs mateee
He did ALL the cocaine before this interview.
have you ever done drugs?
I'd be high everyday if I didnt have worry about money, hes loaded in all the right ways lmao
@@fluffythebunnyslayer20 ALL OF IT
Au contraire!
Gotta love Hugh Hendry
"No need for chaos and the Fed sighh.. Who cares. What really matters is, who got the best coke in town?"
- Hugh Hendry
I always love this interviewer always on the ball
Wow good to see Hugh has been spending the last 5 years partying. He looks like a member of the Rolling Stones.
Looking forward to reading the paper! Thank you for the kick in the head!
Dont you love when the ppl that used the system over years tell you that the system is broken and unfair!
If your smart enough to use a system to get rich then why not..
The rich also created the system by corrupting the politics. Dont tell me they didnt know starving a nation would create a revolution
Yeah let’s just poop on the street instead of using toilets
Ellen Gran they know. It is all planned.
Spud from Trainspotting on economics!🤣
He mentioned Joe Rogan for one reason: Search optimization
He's serious. People need to relate to somebody who came from normal.
It worked!
@@scottr8360 Not running the most powerful financial institution in the world. Bye bye reserve currency lol
Dear Hugh, are you taking Blue AND Red pills by any chance?
He wants Joe Rogan to run the Fed ROFL
It’s ‘tongue in cheek’, surely you don’t take him literally?!
@@antpoo on the back end you don't see the Co-Marketing agreement NDA clauses, now, do ya?
Where are my Real Vision brothers and sisters?
Sup buddy ;]
👍
Yup. I'm Raouling on the floor laughing at this clown.
😉
Hi Hugh! Really enjoy your podcasts and interviews! And a little bit off subject but also really liked your spectacles! What is their brand?! Cheers!
Good to hear a finance guy who understands the dangers of society snapping due to the inequality of the current monetary agreements. When social order breaks down due to obvious inequities, it won't matter how much money is in your account.
I've listened to Hugh talk to Rao Paul of Real Vision, and the guy is kind of off his rocker. I'd take this all with a grain of salt. As an aside, the reason low rates and QE isn't stimulative is at some point, banks don't want to lend when their cost of capital is greater than their return of capital. By lending, they would be losing money. That's basically what's going on in Japan.
I think Japan is a great lesson ..
This guy is the Jim carrey of wall street !!!
Jim is a genius, too
he did manage to dress up properly for THIS interview, i must say.
Let me tell you something! - Fire Marshall Bill
Love this guy!
Johnny Depp looks really rough. I hope things get better for him :(
Chaos could be achieved simply by the cessation of QE globally and letting interest rates be determined by market forces.
In the present circumstances, governments and central banks will avoid this scenario at all costs.
take care
Robert W. M'cCoy
This was the rational approach 30 years ago. Housing would be affordable. College would be affordable. Rents would be affordable. All of this would make the bottom 50% a low wealthier in real terms than today. Retirees would not have to be unwilling leveraged landlords (pushing real estate prices even higher) and stock market speculators into their 70s. Now we are too far gone. Imagine the 10 year at 6 or 7% the USA would be bankrupt.
What book was he referencing / reading? I want in.
Let me know too
The princes of Yen 😷
“The system is broken”. Yep. Big time. It broke a while ago. Fourth turning is here.
An absolutely great book....the 4th turning. What if all High School seniors in the United States or all college business students were required to read it? Would our world be better or worse off?
He looks like a chap I gave $1 on the street.
He is so rich he dosnt need to give a dam about how he looks
Well, technically you did
nothing wrong with busking.
Many rich people do not look rich - far less of a target
As they say, those on the bottom usually benefit from projecting higher status and those on the top benefit from hiding their status and projecting lower image.
Brilliant!
Time has been hard o. Hugh
What’s the book?!
You'll be proven wrong. The only reason he can put forward this argument is the dollar is the reserve currency, pure and simple. Just give it 5 to 10 years.
Great Hugh but I need macro for beginners so I don't have to watch over and over to understand some of what was discussed any recommendations for beginners
"I need macro for beginners so I don't have to watch over and over to understand some of what was discussed any recommendations for beginners" - Great Question! As someone who has been self employed since the 1970's, I have been trying to understand macro since the 81-82 recession because my life has depended on it. For what it is worth, the pearl from this video for me, one that you can "take to the bank", comes at 8 minutes and 20 seconds, when "Great Hugh" states that the tidal change from deflation to inflation will be marked by a simultaneous rise in stock prices AND the volitility index; see fred.stlouisfed.org/graph/?g=tt7Q this is a federal reserve link that I just now created to graph the S&P 500 and the CBOE Volatility Index: VIX. Note anyone can use the Fed's charting system to see macro relationships. Thomas
jojo90 S - I would enjoy hearing more of your questions.
Great interview
What happened to Real Yield?
I wish his mannerisms were less eccentric because I think his points are both eccentric and accurate.
what? he managed to dress himself properly for this interview! you should see some of his other interviews....wooooh boy........
He was completely right.
He needs a comb while the interviewer don't.🤣
Hair inequality
Everybody fears deflation and want some inflation.
Well, be careful what you wish for, because you might just get it.
Inflation is not the panacea everybody think it is. Inflation is not necessarily associated with growth, as we have seen during the 70's.
There is a huge difference between the Fed printing money and giving it to the banks who are basically just sitting on it, or diverting it to the stock market, and the Fed printing money and handing it to the treasury, which is handing out checks to people, so they can go out and spend. The former had no impact on velocity, the latter will.
The fed isn't " printing money", they are digitally crediting certain accounts.
BRRRRrrrrrrrrrrrrrrr
We don’t even use Money. Anyone who says “print money” is either a liar or a moron. They don’t understand Fiat Currency
No. Just trying to learn and understand.
If Bill Murray played in Fear and Loathing in Las Vegas, thats what he would have looked like.
was half expecting a keith richards cameo, passing hugh a plate of cocaine
So I bought a bottle of Powerade the other day for about a buck. It used to be 32 ounces. Now it is 28ounces. This is how manufacturers deal with inflation. They don't raise the price they just give you less.
Its called shrinkflation, and yes its crazy, happening with everything
Same thing with hedge funds. They just give you less
20 oz Snapple is 16 now
Can someone here explain to me, he said "Fed is not printing money, it's increasing central bank reserves" Does he mean the liquidity the US Fed injects into US banks eventually all end up in Central Banks of major countries like EU, Japan and China?
The US eventually exports its domestic inflation, that doesn't mean there isn't inflation right? I mean just because US economy can absorb the inflation, dollar inflation still adds to other countries' domestic inflation... Or am I not getting what Hendry is saying?
The printing of money (quantitative easing) does not necessarily result in inflation. The Chicago Monetarist theory was always a bit flaky. Inflation is solely caused by demand exceeding supply and in the Covid19 world we have now with mass unemployment, demand will be very low.
Mad genius!
he does have a point. The Fed can't keep up the status quo for much longer. The bull market will continue for 2-3 years but with asset price inflation leaving Main Street behind, something will have to give..........We just don't know what.
Mickey Rourke's greatest performance ever.
He is not high. Dummy dust is just that. He is right!
Guy sounds like he's 30mg THC into it.
Read some DSMMV books. Reality perception is reserved for the learned.
Scott R hm care to elaborate?
The dogma of austerity is so deeply ingrained, even its detractors refer to it as "responsible".
The trick is to try and increase the velocity of money. The price is irrelevant as long as its kinda stable.
You want the people in the economy to be busy earning and spending, not saving and waiting.
That's the inflation he's talking about h relative velocity of money
Exactly people don’t realize velocity is the most important factor.
@@stringzar I think the opposite, with QE asset purchases and ultra low interest rates the more credits (currency dilution) I create to buy assets.
OUTSTANDING!
He is correct. Treasury is cooking the books when they started to promise to buy everything just to hold up the market. So u can just buy any damn stock and I still can profit from it 😂
Great interview!
Fix your volume controls please all your videos have too low volume!!!!
Living Legend.
QE and printing will not cause inflation as long as it doesn't trickle down.
As income gap increases, deflation will increase as people are left with less money to buy the produced goods and services.
Agree. The printing of money (quantitative easing) does not necessarily result in inflation. The Chicago Monetarist theory was always a bit flaky. Inflation is solely caused by demand exceeding supply and in the Covid19 world we have now with mass unemployment, demand will be very low.
Inflation comes after the bust. BUT since we're talking about modern america, middle and lower class will not see the uptick, and maybe inflation won't happen because, despite covid being defeated (someday), the average american won't even tell the difference. Happened 10 years ago, might happen again.
Living on the Pacific Northwest waterfront where one of the strongest of public waterway advocates reside...the government here turned management of the seaside to a private agency to decide how the public mandate is enforced. This became the way for the waterfront to be chopped up into hotels, condos, and restaurants without public scrutiny and citizen comments. This is also how the Federal Reserve operates without comment from the people.
A classic example of the fact that being rich does not mean you are not a total prick
"Why did I get charged for murder? The bullet killed him not me, if anything I was wearing a glove so the glove pulled the trigger!"
The pavement was his enemy.
i wonder how many people know the "needle was a small opening in the wall that a camel could only pass through once everything was removed.
The Hedge Fund Casey Neistat has joined the party!! Welcome Hugh! 🤣
I think Mike Tyson would also shake things up, maybe even more than Joe Rogan
A few years ago, i watched an interview with Marc Cuban in which he said something that i thought was totally crazy at the time.......he said that future business leaders and top entrepreneurs would be well versed in Liberal Arts (i took it as eccentric mind set). After studying many interviews with Charlie Munger and this Hugh Hendry.........i think i am understanding Mr. Cubans comment. We need Cuban as a presidential candidate. If not in 2020, in 2024.
changing social behavior changes prices....
The Keith of Finance
Keith Floyd 🤡
@@Luke-iq9yk hey thanks for introducing me to keith flyod!
This guy gets it.. Everybody's railing about the Fed creating credit while Technology is starved for dollars.. Dollar demand is strong overseas too..
Another piece of this puzzle is technology is highly deflationary, this offsets the areas of the economy that are inflationary. For example 20 years ago I needed to buy a map in order to get to where I wanted to go if I went to a new town. Now I just use Google Maps which is free. A lot of this is missed by the main streeters. People like hugh hendry understand it so well intuitively, they do not discuss it in interviews like this. When is the last time you bought a map? How much money do you or your family spend yearly on screen Time Entertainment versus 20 years ago? Huge deflationary factors with technology. The flip side is Healthcare is going up 15 to 20% or more depending on where you live each year.
I think he's reading Deluze? Interesting
He says there is no inflation and yet he would be long gold???
Hendry's nailed it. A lot of inflation. Currency pegs breaking. Gold through the roof. Equities rising. But it needs the political chaos first.
Jonathan Ferro was terrified the entire time that this guy would start dropping F-Bombs
Look at this dude.
End the Fed.
Beautiful mind.
Inflation is not under control, it's at all time highs, it's just not in the consumer goods prices ..... It's the asset prices that are inflated.... Raise interest rates, and watch everything go back to normal.
in restrospective, it want the other way around
He’s got a point..
After hearing Hugh's reasoning I have to say he may be on to something. We may very well have been looking through the wrong end of the telescope. the Fed has already printed a hell of a lot of money. Why hasn't gold gone through the roof? His contention is that the Fed has increased the money supply. Inflation is not a result of interest rates but how much money is out there. His contention is that the Fed should churn out way more to get the economy back on track. He may be right.
We need JOE ROGAN!!! JRE ROGAN 2024
Hugh, the system is broken. Now when exactly did it work properly? The 90s? 80s? 70s? 60s? 50s? 40s? 30s? 20s? 10s? 1890s? 80s? 70s? 60s? 50s??
prophetic. . .
Oh my God, look at a photo of this guy from like 5 years ago and today. Notorious short seller, looks like he needs help.
He's so rich and had to work so hard to get there.
My friends are investment bankers and each one has aged 25 years in ten years
Chaos is a ladder.
Digital currency offers the monetary restriction the Fed lacks and the chaos that markets need.
Buy the top! Its actually the bottom from the other side!
Hughs basically saying..."screw the savers".
Chaos is natural, and when you try to suppress it it will only come out as a bigger chaos. They say the road to hell is paved with good intentions or the other version where hell is full of good meanings, but heaven is full of good works.
WOW I love this
I laughed out loud at this crap
So the FED buying up assets and having a balance sheet to infinity all while artificially lowering rates (no rational person would lend the US government money at no return) is bringing prosperity to the average person?
Inflation is an energy phenomenon ... and a measure in entropy ... economics is a physical science not a social science ...
So our society remains together ? Man what Planet do you come from ? My Aussie Society has been totally divided my entire life ! We call it Multi Culture . which is them against us .
Joe Rogan for fed reserve lol
Three words: Dollar Milkshake Theory
wtf? that DMT was pre-corona. why still mention it?
just a perma bear that never understood the effect of QE on asset prices, especially equities. sad. his performance was dire bar 2008. i hope his mental health has improved and stays positive.
Wow, rubbish, this guy is very misguided. The FED literally created dollars in the system no matter what way you think about it. They had to create the dollars or bonds and trade them into stocks and other bonds, the point is that they are inflating. They did not create value. Of course you see the inflation in the USD chart last, just like you see the US economy turn into just two classes last. The cost of living going up 3x compared to wages is the best metric I think. The bailouts go to the monoplolys which run everything including the banks and infinite supply of money and who gets elected indirectly by funding their candidates infinitely.
Just #buybitcoin and quit trying to think so much pal
Well that was clear. Two cups of bluster, a pait of designer glasses and a pinch of Joe Rogan. How illuminating. Why try to calculate whether the Fed has printed money? For a start, the term "printed money" is ambiguous, but aside from that what does the Fed say about it? And WTF is quantitative easing if it's not "printing money"?
Silver 🥈 is a great opportunity 👌
Brilliant though.
The most brilliant artists are tortured by dealing with society. This man is a genius.
I like Hugh but betting on negative rates was wrong. Very wrong.
Damn Richard Hammond looks rough
Including bankrupt ones
But then wouldn't that cause the dollar to lose the credibility for safe haven n increase the force against dollar as a reserved currency as China and many other countries have been trying to change?
this hippie guy should invest in good haircut and comb 🤣😂🤣😂🤣😂