Episode 11: Macro Investing Outlook with Jesse Felder

Ben: [00:00:00] Welcome to the alt asset allocation podcast, exploring alternative investment opportunities available to the everyday investor. Here’s your host Ben Lakoff alone. Welcome to the alt asset allocation podcast. Today’s interview is with Jesse Felder. So Jesse needs no introduction. But in case you don’t know who he is, he’s been managing money for over 20 years.

He began his professional career bear, Stearns and co, and later co-founded a multiplex billion dollar hedge fund headquartered in Santa Monica, California. Today. He works with a select group of clients, Felder and company, LLC in bend Oregon and at thefelderreport.com. If you haven’t checked out the Felder report.com highly recommended it.

He’s got some great stuff there. Great blog in this episode, all things macro investing, including outlook for us and emerging market equities, the U S dollar. Inflation gold commodities. And we go into great detail on the forces at work driving. Each of these

Jesse’s blog and Twitter are a treasure trove of great information on financial markets.

And you won’t want to miss details on how he consumes. Such a breadth of information about markets and the Twitter accounts that he loves before you listen, please don’t forget to like, or subscribe to the podcast gas anywhere where you digest these and even better would be to leave a review on Apple podcasts.

This really helps with the rankings. There is loads a value in this episode, please enjoy this conversation with Jesse Felder, Jesse, welcome to the podcast. Excited to have you.

Jesse: [00:01:39] Hey, it’s my pleasure. Thanks for having me. Absolutely.

Ben: [00:01:42] A lot of my listeners know who you are and your background for, but for those that actually don’t know, can you give a brief background who you are?

Jesse: [00:01:49] Yeah, sure. I started in the kind of investment game right out of college. I actually didn’t study finance, I was always interested in it though, but I studied English. And when I got out of school, I knew I wanted to be in a career in finance, it actually worked out well because I think a lot of the people I admire most believe that, a lot of what they teach you in school, it’s kind of can hinder you more than help you in terms of the market.

So I went to work straight away for bear Stearns, in LA in century city, actually. They sent me back to their New York office to guys tour the floor of the New York stock exchange with their head trader at the time, bear was doing more business on the New York stock exchange than anybody else. So that was the chronic, a great education.

I worked at bear for a little while, just kind of in the private client side of things. I found a guy there who was essentially running kind of a hedge fund inside there. And we ended up leaving to start our own, our own fund. And from. and that would have been late 97. and you know, from late 97 until March of 2000, right?

Really the, the runup, the, the final run of the dotcom mania through 99 in early 2000, I was the head trader of this, hedge fund firm. And really had a front row seat to that. And I quit, I quit the firm in March of 2000, literally right at the top. I wasn’t trying to time it or anything, but I had just, I, you know, there was a firm for a number of reasons.

it was a good time for me to leave and I, I moved to, bend Oregon and essentially been just managing my own money and writing about the markets ever since

Ben: [00:03:23] what, a time to leave March, 2000, couldn’t have top ticket any, any better than that, probably fray.

Jesse: [00:03:29] Well, I think, you know, there’s so many things go that way.

There was so much, you know, emotion and, and, you know, part of our discipline, we were supposed to have a, a value mandate. And so my, my partner at the time who was the head portfolio manager, was wanting to abandon all of these value stocks and dive into the, you know, all the. You know, most popular momentum names and it kind of came to a head right around that, you know, naturally during that March of 2000 peak, when, you know, there were so many terrific opportunities and value, and we were moving away from those and into these things that were just about to implode.

And so, you know, our relationship was kind of, you know, just imploding at the same time. So,

Ben: [00:04:14] absolutely. So I actually wanted to start with. Something a little bit different, but I think this is a perfect segue. Something you shared today on your Twitter, which is a fantastic resource for any of my listeners, by the way.

And I definitely want to get into that, but, the ft article about the us stock market bubble and the, the comparison to Japan in the 1980s, and one quote from it, was that. 530 out of America’s eight, eight that 8,500 listed companies trade at more than 10 times sales. And this reminded me of one of your articles on your blog as well.

The, what were we thinking? What part to deuce? but I, I actually will link as well, but I mean, at 10 times, earnings 10 times rather this, these are just bonkers valuations, so let’s, let’s just. Jump right into it with your, your current view, the stock market. This is recording on September 8th. so some of that.

Mania from last week as it kind of come back a little bit, but there’s still just so stretched. So let’s, let’s dive right into it, us stock market. What’s what are your thoughts here?

Jesse: [00:05:26] Well, it absolutely is. another speculative mania similar to that Japanese, you know, bubble that peaked in the late eighties, early 1990 and to the.com mania.

you know, I, I probably should. To qualify this by saying that, you know, it’s through just anecdotal evidence. I’ve noticed that depending on when you come into, you know, wall street, as a career that the first couple years are very, make a huge imprint on your, on the rest of your career. For me coming into the middle of the.com and yet watching them as you know, Just huge pyramid scheme is what it felt like to me at the time that that’s colored me towards, you know, being more, you know, wary of those types of things.

And so I, but I do think this is similar in the respect that yeah, you can look at valuations. I was just right before we started recording, looking at a one another evaluation measure I use, And that’s basically just taking the three biggest stocks in the market, Amazon, Microsoft, Apple, and you look at the price to free cash flow and that the latent, I think the peaked valuation wise in December of 99 at about 45 times free cash flow, just that I’m talking about aggregate free cashflow.

So take the three market caps, put them together, take all the cashflow, those three companies create and just create a ratio. And so, Yeah, it’s on September one, they hit 48 times free cash flow. So it was even, they even got more expensive relative to free cash flow than they [email protected] mania.

and that was with, you know, Amazon, you know, generating, you know, no free cash flow. And what would have you back then? So, Yeah, but on a price to sales, I think is another interesting one to look at because you look at a Tesla to me that, that quote, that, what were you thinking? It comes from Scott McNealy, who is the CEO of sun Microsystems.

Back in the day, his stock went from five, six bucks a share to 65 bucks a share. Like in several months time, very similar to Tesla up tenfold and it traded over 10 times sales for basically a, you know, a networking computer, you know, server type company, hardware maker. and so yeah, you can never really have amazing margins to support.

That type of evaluation, but when you’re a hardware company, but I think Tesla recently got up almost to 20 times sales. I haven’t, I haven’t looked at it, but I was 14, 15, 16, 17 times for another company that will never have the margins to support something like that. It doesn’t have the sales growth either.

I mean, Tesla sales growth is flat to negative. Right now. So the valuation is absolutely insane. Even more insane than sun Microsystems was, you know, back at the peak of the mania. And I do think Tesla will prove to be that kind of, you know, iconic, you know, poster boy for the bubble that we’re watching now in that article.

Ben: [00:08:15] I mean, Scott McNealy’s quote. Is just for the listeners that perhaps don’t understand what 10 times revenue means is that if they pay out a hundred percent of their revenue for 10 straight years, so they have zero expenses, zero R and D all of this in a hundred percent of their revenues paid back, it will take 10 years.

So for Tesla to be above that, I mean, this, your pricing and just crazy, crazy growth in, into these numbers, right?

Jesse: [00:08:43] Yeah. And it’s not just Tesla. I think this is a really important point that I think a lot of, so Tesla fans would say, okay, well, you know, this is not just 10 years ago. We were pricing in 20, 30 years with the growth and the earnings might not even materialize in the next 10 years.

They’ve maybe point to Amazon and look at, you know, you paid. 10 15 times sales for Amazon in 2000, he’s still have done pretty well, you know, and owning you bought the stock at the peak back then. you know, so they’re saying over a 20 year period, you could have the growth that, you know, comes into justify that.

But I think. When you’re in there doing this with Apple, right? I mean, w when you’re willing to salesforce.com is another great example, trades 200 times free cash flow, right? It’s one half of 1% free cash flow yield. And so when people are saying, okay, well, that’s fine because interest rates are zero. And because Salesforce is going to grow like crazy for 20 or 30 years, the further out you project that the, the, the, the more room for error.

You were allowing, or actually less room for error, you’re allowing in your analysis because if interest rates don’t stay zero for the next 20, 30 years. Right. If interest rates go back up to five, 6%, all of a sudden your discount rate and that discounted cashflow model has to go up and the valuation comes way down.

So you’re making that bet the streets are gonna stay zero for 20 years or 30 years. You’re also betting on them being able to grow earnings or grow sales or whatever it is at a five, six, seven, 10% for 10 or 20 or 30 years. If that grow rate growth rate, just assume grow earnings, you know, do 5% a year.

For 20 years or 30 years, if that growth rate ends up being 3% instead of five, right? Your evaluation is cut in half. And so that’s, there’s so much duration, risk, I think in equities right now, you typically think of duration, risk in bonds. Like, okay, I’m gonna buy a 30 year bond. I’m gonna go way out on the, on the curve.

And if interest rates do you know, a little bit of movement, it makes a huge difference in the price today. That’s the same thing when you’re putting, when you’re making a thing. 30 or bet on a stock that what interest rates do and what the growth of that company do has a massive change in the evaluation.

You, you know, you come up with today. So, I mean, I, I just was, you know, writing about this recently, if you use a 5% discount rate, In a survey of 5% growth rate, you can get, you know, you can come up with a reason to spend, you know, a hundred times earnings for a stock. But if that discount rate goes up 2% and the growth rate comes down too.

Right. You’re only looking at a 10 times multiple instead of a hundred times, literally the valuation came down percent by those small changes in the adjustments that you’re making. So I think today investors are taking this duration risk in the equity market. more duration risk than they’ve ever taken before and counting on this earnings growth to sustain for a long period of time and counting on interest rates to save very low for a long period of time.

Ben: [00:11:41] Yeah. And I mean, this time it’s different, right? There’s a number of factors. Like I don’t see the rates ever coming up or just how that’s even possible. And we’ll dive into that in more detail, but you know, you’ve written as well about the passive investing bubble and this, these sorts of things as it’s, it’s just this self fulfilling prophecy because their market cap weighted and money’s flowing in.

So it’s going to these big companies. I mean, what are your thoughts of this time? It’s different with. These different factors that are flowing into it. And how do you think through how these are impacting stark stock market valuations?

Jesse: [00:12:18] Yeah, I think, you know, I mean this time it’s different, it’s, you know,

Ben: [00:12:21] a classic,

Jesse: [00:12:23] right.

John Templeton, you know, famously said four more, most dangerous words in finance. This time is different. and you know, people have been saying that for five, six years and there hasn’t been. You know, any consequences for that, that, you know, people, I believe this time is different for so many. they believe that, you know, valuations don’t matter anymore.

You hear a lot of people say price to book matter, doesn’t matter anymore as an evaluation tool, because so much of the value is in intangibles now. And either, I mean, you can come up with so many different, this time is different arguments. but yeah. Yeah. At the end of the day, this time is much more similar to it was in these past manias than it was, you know, to, to, to think that this is the beginning of a new bull market, I think is, is absolute insanity.

because there’s so many parallels to, to pass market peaks and, and you’re right. Those to me, I see too. Two manias at work. Presently one is the passive mania, which has been going on, like I said, for at least five, six, seven years now, which people believe that, the price you pay does not determine your rate of return any longer, which is, you know, Cornerstone of Buffett’s success is the price you pay determines your rate of return, pay a cheap price, get a high rate of return, pay an expensive price, get a low rate of return.

passive investors think I can just come in and PI pay any price. I can pay the highest price and history. And I still deserve a historical rate of return. I still deserve an eight to 10% rate of return, which is, you know, that that in itself is manic thinking.

Ben: [00:14:01] well, the thought there is that on a long enough timeframe, like I’m putting this money in for 30 plus years, the historical average is eight years.

So over this time period, like it’s, it’s a blip on the radar, right? That is that kind of the main

Jesse: [00:14:16] argument. And that goes with another, another, you know, George Soros said, you know, every bubble has, you know, these, these, mistaken beliefs that support it. And one is that, that the price he paid is not.

determine your rate of return. Another one is that no matter, you know, the price I pay, as long as I hold on long enough, I’ll always be made whole that, you know, the market always has never had a 10 year period where you’ve lost money or a 20 year period. We’ve lost money, you know, for as long as I’ve been long enough timeframe, I’ll be made whole.

And you know, that’s another mistaken belief. I think that if you look back at the history of the us stock market, especially in real terms, I mean, if you bought in the late sixties, you know, you had. 30 plus years of, of losing money in terms after inflation. But if you bought it the 1929 peak, you know, there was 20 plus years where you were under, under water on that investment.

And I think the point that I would make in relation to that is that today valuations are higher than they were. We’re at the 29 peak. So it’s certainly possible that we have a 20 year period where if you buy stocks today, 20 years from now, you could still be underwater. And Japanese investors would be the first ones to say, yeah, look back at 1990, we’re still, you know, 30% below that peak from 30 years ago.

So, so, you know, that that’s another mistaken belief, but you know, those are the ones that I think are driving this passive bubble. It’s just put money in stocks, no matter what. But there’s also, you know, a, a retail, classic speculative mania going on right now in the options market that, you know, we can talk about a few, if you want

Ben: [00:15:51] the auction market alone.

I mean, these call options, massive quantity of call options. The key takeaway there is that it’s displaying a lot of these peak mania. characteristics. So it’s fair to say that your not that bullish near term or longer term on the us stock market as a whole probably. And I don’t want to put words in your mouth, but yeah.

Are there pockets of value? I mean, maybe eventually we’ll go back to value testing one day or emerging markets or anything within these markets that actually, you know, might make sense on a longer term horizon.

Jesse: [00:16:30] Yeah. I mean, I, I do think, emerging is, is attractive relative to, you know, more developed markets.

emerging is, is cheap, you know, on its surface. And it’s also cheap from a currency standpoint too. I think the dollars overvalued. And so, yeah, but in terms of the us stock market, I do think this is probably one of the most dangerous times. To be an equity investor in history, short term and long term.

I think there’s a very good possibility of another lost decade or P you know, there is no money made over the next 10 years in Michigan chance, actually investors 10 years from now, we’ll look at, you know, a loss even after dividends, are included over, over a 10 year period from today’s prices. So I think it’s, you know, extraordinarily important to, Understand that that risk is there in the market.

you know, for another possibility of a 50, 60, 70% decline in equities is as great as it’s ever been. And so, you know, I think for a lot of investors to think back, okay, That 2008, experience that 2000 to 2002 experience. Those are what typically happened as a result of a bursting bubble. And I think we are in the, in the process of, you know, a large topping pattern of bursting bubble and whatever you want call it.

And, and the only reason that it hasn’t burst as part of, you know, the COVID, induced recession, global recession, is that. We have seen an unprecedented amount of money come into the market in the form of stock options that has really kind of created this final blow off in the NASDAQ.

Ben: [00:18:08] I completely agree.

And this, this whole, you know, Tina, there is no other alternative is, is very dangerous thinking. So you’ve touched on it briefly. Bearish on the dollar, a number of reasons. Can you touch on, on why exactly you’re bearish and what those reasons are?

Jesse: [00:18:28] I’m sure there’s, you know, the, the two longer-term drivers that I look at, for the dollar are one, its valuation relative to its peers, even looking at, you know, purchasing power parody or any type of the big Mac index is a good, you know, shorthand for, you know, what does it cost to, you know, Produce a big Mac in the United States versus other other places.

you can do that. You know, basically that’s a shorthand for purchasing power parody and that’s just the valuation of the dollar versus other currencies dollars over valued, you know, versus, you know, almost every other currency on the point. and the, the more important one for me, fundamental driver for the dollar is probably the fiscal situation.

If you look at. The, the deficit to GDP, the dollar tracks that pretty closely over long periods of time, it would get a 20, 30, 40 year chart. And you’ll see that, you know, when the deficit is widening, that’s usually bearish for the dollar. Now, the deaths had started widening when the.com mania burst in on tax revenue went down 2001, too.

the deficit started widening for two years before the dollar really rolled over hard in 2003, four five. and so sometimes it does work with the delay, but when Trump and, you know, initially created these corporate tax cuts and created a trillion dollar deficit during an economic expansion for the first time, since the 1960s, you know, when Nixon was trying to pay for the Vietnam war, You know, that to me was, you know, a major red flag in 20, and then we saw the dog rollover pretty hard and, I think it was 16, 17.

and then it’s rallied, you know, since the deficit is since widened, you know, much more dramatically. as a result of, you know, falling revenues now w w was falling revenues from the tax cut. But, you know, now it’s falling revenues plus massive fiscal stimulus, 2 trillion in spending, you know, 3 trillion in spending, whatever the numbers are creating a massive $4 trillion, you know, deficit.

So that, that historically has made people wary of owning owning dollars and say, especially when the dollar is overvalued, those two dynamics together, the, the. Deteriorating fundamentals paired with the dollar being overvalued to me, point to another major bear market for the dollar over the next few years.

Ben: [00:20:47] Yeah. Completely agree. I mean, but these numbers, they’re just numbers on paper, right. Things that we can and fathom a couple of trillion, stimulus pumped in, and it’s just, it is what it is. But I mean, the more I look. So it’s, it’s always a trade off if you’re, you’re either in dollars or you’re in another currency or gold or, or some other placement, I suppose.

But the fiscal situation is pretty ugly in most other countries. I mean, so looking at the dollar and the fiat alternatives, I mean, is there any kind of shining light that you’re seeing or, or it’s just. That’s kind of the death of fait as well as the dollar being overvalued.

Jesse: [00:21:27] Well, I think, you know, you know, namely Euro and yen, that’s not to say that I want to own those currencies, but it’s also one reason why probably, emerging market equities are, you know, attractive, not just because, you know, like I mentioned before, they’re, they’re cheap.

You know, relative to their own history there, the currencies are also cheap. So a dollar, a dollar bear market is usually good for, you know, those types of, investments, you know, that are priced in, in other currency. So, so I, I do think, you know, emerging could benefit, from, from a dollar bear market like that, but typically, you know, If I’m trying to hedge my, my dollar exposure, I’m going to want to own precious metals.

I think you look at that, that dollar bear market that I was referring to from essentially from 2002, three until 2009 10, and you know, that was a wonderful period to own gold. and so I do think, you know, I’ve been. Bullish on gold since late 2015, really? When, when the wall street journal called it a pet rock and it was, it was the most hated asset class on the planet.

it’s had a really good run since then, and I’m not as short term bullish on, on gold as I, as I have been, for that reason. I do think it’s probably gotten a little bit overheated in the short run, but longer term. If you’re looking to, you know, protect yourself from a dollar bear market, I think you have to have some exposure to precious metals and namely,

Ben: [00:22:55] yeah, I know I’ve read that.

gold exposure in portfolios is at all time lows, whether this is a byproduct of all time, high equity valuations, probably. But, you know, I think there’s certainly some upside. Completely agree near term. We’ve had a fantastical run-up this year, but I think longer term with the fiscal situation and the dollar situation.

I think it makes a lot of sense to add to our portfolio, in terms of dollar rates, low, forever yield, current curve control. What are your kind of thoughts on where this goes from here?

Jesse: [00:23:33] Well, it’s really interesting. I think the fed is, is, kind of, you know, boxed in to, boxed in is, is maybe not the term.

I, you know, the term is fiscal dominance. It’s the fed is being forced to monetize the debt now. you know, and I think that’s a very important distinction that quantitative easing. In the past was kind of a, a discretionary policy. The fed said, we want to try and boost the economy. We’re going to do this just by, you know, buying, you know, treasuries.

And that will hold interest rates, not just down on the front end, what we’re going to hold and straits down across the curve. make it more attractive to borrow and spend. but also it’s going to force investors out the risk curve that if they can’t make money and owning longterm treasuries, we’re going to have to go buy corporate bonds.

We’re gonna have to go buy stuff box. So this was a, you know, a conscious policy by Ben Burnanki to try and create a wealth effect and also try and, and, you know, boost the economy by lowering interest rates across the curve. Buying of bonds today by the fed is not so much. A quantity, a policy that’s in line with that quantitative easing, where they’re trying to create a wealth effect or anything.

I think when the repo fiasco happened, you know, almost a year ago, almost exactly a year ago, that to me, it was a sign there wasn’t enough natural manned in the market for treasury bills. It comes back to this deficit. We have this trillion dollar deficit treasury has to issue a bunch, a trillion, a new debt.

To to fund it. And if there aren’t enough, my buyer’s interest rates go way up. So what happened was a bunch of hedge funds said we’re going to borrow money in the repo market. We’re going to leverage maybe 10, 20, 30, 40, 50 to one. And we’re going to buy up these treasury bills cause we can make, you know, if we leverage it up, we’ll make money on the spread without these hedge funds.

Buying tens of billions, of dollars of treasury bills. There probably wasn’t enough natural demand to soak up all of that new debt issuance and interest rates would have gone up. So when we had these problems and repo and these threatened to blow up all these hedge funds and create potentially another financial crisis, the fed had to come in and say, we’re going to fix repo.

We’re going to start buying treasury bills again, we’re going to start funding that the government directly to me, that was a change of, we’re not doing this for quantitative easing. We’re doing this because there’s not enough natural demand for all of this new data. Sean’s. And to me, that is, that’s a huge change.

This situation, a fiscal dominance, where the fed is now forced to monitor size of the debt to prevent interest rates from going higher is the type of situation you get when people start to lose faith in the currency. So people’s principles right? Saying, Oh my gosh, they’re going to, you know, they have to raise 4 trillion additional and the fit’s going to monetize it all.

That’s hugely inflationary. And if we own treasuries and we’re going to get paid to have, you know, 50 basis points on owning a 10 year treasury note, and you’re going to, you’re basically now telling us you’re going to try and create inflation over 2% and you’re going to monetize the debt in order to do that.

This is, this is how you get a bear market. Like I’m talking about where people just say, okay, there’s no point in owning tenure, treasury notes, getting paid 50 basis points. And they’re trying to create two, three, 4% inflation and they’re gonna monetize the debt in order to do it. and so that’s when you get people liquidating and the dollar goes down and you can, you can create an inflationary problem.

So I think that. This is why I’ve said the doll. Probably the only thing that has the ability to take the printing, press away from the fed, because if the fed decides we’re going to monetize 4 trillion, you know, we’re going to just however much the government does, does we’re going to monetize it. The dollar will tank.

And the federal before to say, okay, this is a sign inflation’s coming. We can either continue doing this, or we have to, we have to change somehow. And it’s, it’s a, it’s a very dangerous, I think in scary situation that could be, could be coming because if the fed doesn’t monetize it, interest rates go way up.

And that may be means that the treasury can even services debt without issuing new new debt. and if they, if they, you know, do Mont continue to monetize it, the dollar could, like I said, go down 30, 40% in value and that could create a real surgeon inflation. and so it’s, it’s a very, very interesting time, you know, I, I remind people that.

May you live in interesting times as a Chinese curse out a blessing that we, we are, you know, living in interesting times right now.

Ben: [00:28:04] I like it. It certainly is a curse though. And this fiscal Don dominance in this corner that the U S. Dollar and fed and economy has been backed into you. Talk about losing faith in the treasuries and, and these sorts of things.

And the dollar going down by 30, 40% gold will go down as well. This is a, this is almost an apocalyptic. Sort of scenario, right? So, I mean, how does a, an investor think through this obviously bullish on gold and precious metals, but like that almost sounds like a guns and ammo and bunker in the back sort of situation.

So how, how do you think through. This,

Jesse: [00:28:45] it’s not nearly as apocalyptic as a, as I’m making it sound. Probably the dollars had bear markets of 30, 40% in the past, and it’s not even lost its reserve currency status. So you can have a 30, 40% decline in the dollar without, you know, having, you know, these end of the world, you know, types of scenarios and this, this, this happens, right.

I mean, part of this is also, you know, goes along with the, you know, global hedgemon through history, right. We saw the British empire and the value of the pound, you know, declined dramatically after it’s became so indebted through world war II and lost its its status. you know, I think this is also why that, you know, there’s all this strife with China because China is in a better place financially than we are.

They also have you’re growing a lot faster and that can, you know, that growth economic growth can solve a lot of problems over time. you know, if we had that type of type of growth, we wouldn’t need to create inflation to get out from under the debt that we have creative, but I think the fed realizes there’s no way we’re going to grow 6% a year.

Like China, we’d be lucky to grow to 3% a year over the next, you know, 10 20 years. And so it’s going to be very difficult if not impossible, to grow our way out of this debt mess that we’ve created. So inflating it away is really the only way the only solution. so I, I don’t see it as something that’s super apocalyptic or anything like that.

I just think it’s. It’s a, you know, something that’s happened throughout history to, to major major countries. And I think the biggest thing that I, that I look at in terms of this is the Fed’s either going to have to allow for, inflation to really take off, like much more than they’re talking about, or they’re going to have to let the stock market.

Go, and, and reign inflation, not going to be able to have their cake and eat it too. So you either let inflation, you know, run crazy because you’re, you know, printing, printing money to monetize the debt and trying to support stock market corporate bond market, and the treasury market all at once. And inflation goes nuts as a result or.

You said we can’t let inflation go nuts. We have to reign in some of this money, you know, the money printing the monetizing, the debt. And, you know, if you do that, then that removes that floor. That’s under asset prices. And so, you know, I think it’s a question of one or which one of those two scenarios.

And I do think it’s probably likely that. They get both that. I think that we could see a stagflationary bust in the, in the stock market where we get weak growth rising in inflationary pressures and the stock market rolling over all kind of at the same time. and, and, and that’s just something that could, you know, that’s kind of a third possibility, I guess.

And I think it’s probably the most likely.

Ben: [00:31:38] Yeah. And I think I, I mean, how important and prevalent this wealth effect is in the stock market going up and people’s support folios going up. I just, I find it really hard to believe that they pull, pull the plug on the stock market and let it kind of drift down to valuations.

That make sense. So this is kind of my thought of always having stock market exposure, no matter how bearish and how much I want to be. 50 50 golden dollars. Right?

Jesse: [00:32:05] Well, I would just say to your point that it’s, it’s really tough. It’s all of this new debt makes it very tough for them. The fed to actually prop up the stock market.

So people point to liquidity and all this fed liquidity is what’s propping up the stock market, but like Stan Druckenmiller talked about back in, I think it was March or April. It’s not just fed liquidity. You have to look at its net. Liquidity. It’s the amount of money printing less the amount of new debt issuance coming out of the treasury.

So, when the fed was doing QE before. If the fiscal authorities were doing nothing and the amount of the debt was essentially staying the same, any buying the fed did reduce the supply of financial assets and therefore made them more valuable. you know, and that was how QE works to support the stock market over the past 10 years.

But now with, with 4 trillion new debt coming from the treasury, that’s four truly, and that’s almost. Anti QE. That’s the opposite, right? That’s fortunately in a new securities, new supply of security securities that equal makes all of those securities less valuable and should push the prices of all of them down.

So the fed has to soak up all that 4 trillion of new issuance just to have a net neutral. Liquidity situation. So this is where I think where it’s getting really interesting because the fed expanded its balance sheet by 3 trillion, you know, in March, April, may, and since then they’ve done nothing. The balance sheet has been flat.

The tr the treasury now needs to issue 2 trillion of new debt before year end. So if the fed doesn’t soak up that tutorial, then that’s 2 trillion of essentially negative QE with, with the supply of financial assets growing. That’s almost like no negative liquidity coming to the market before year end.

I think this is a really important time, you know, we’re watching the markets and then there’s lots of things going on. But I think part of it is this, market trying to price in, is the fed gonna mop up this, this, you know, this exit, these excess securities? Or are they not? Cause if they don’t that net negative liquidity situation can be very bearish for equities.

Ben: [00:34:17] We have to just insist on more Robin hood traders, a property buying it up. Right,

Jesse: [00:34:23] right.

Ben: [00:34:24] I mean, my, my thought is with, if inflation goes rampant, the stock market goes up, right? Because people don’t want cash. They’ll put it anywhere. You look at Venezuela stock market as, as a most extreme version of it. So it’s, it’s certainly. Interesting

Jesse: [00:34:40] and there’s gradations of that, right? So if straights from, from whatever, zero to five, six, seven, 8% inflation, that would probably be very bearish for stocks because people would go, wait a second. I can go buy a 10 year note or a 30 year bond and get five, six, seven, 8% risk free. All of a sudden.

Now, if I’m discounting low interest rates for Apple, all these other stocks. Now those low interest rates are gone. The valuations declined dramatically, but once you get up into that hyperinflation, you get up in teens, inflation and stuff. That’s why I think you need to pay attention to earnings because that, that type of inflation will start showing up in earnings.

You’ll start seeing it in copper prices. You’ll see it in commodities markets and you’ll see it in earnings. And until you see it in earnings, you’re not going to see it in stock prices. I think these people who are saying, you know, that stocks are starting to discount hyper inflation. To me, that’s another just, irrational justification for current valuations.

Because there, I believe there would be a period where we would go from zero to three, four or 5%. Inflation and interest rates that that stage would be very bearish for equities. If it goes into hyperinflation from that point, that’s when people would say, Oh my gosh, I don’t, I don’t want to own anything except, you know, real estate, gold stocks, you know, things that are going to somehow preserve their value.

But there’s an in between stage there that we shouldn’t forget about.

Ben: [00:36:14] Yeah. That makes a lot of sense. I mean, at that point, I mean, it’s literally anything, but. Dollars or, or fee at currency, so, right. That’s a good transition into commodities here. I mean, I think you’re pretty bullish on commodities in general for the. for the average investor getting exposure to commodities. I mean, are there certain types of ETFs? Like how, how does one get exposure to commodities

Jesse: [00:36:42] as a whole? Yeah, well, I think, you know, one of the charts I’ve been looking at for the last several years, and this was related to the gold trade, you know, from five years ago, is that commodities relative.

Can relative to financial assets. It’s the lowest in history. in other words, saying its financial assets are more overnighted than in history. So there is an opportunity in commodities for the long time. To me, it’s incredibly ironic that we have the most inflationary, monetary and fiscal policy in the history of our country.

at the same time we have a fed who’s telling us they’re gonna they’re hell bent on raising inflation and what’s the most. Hated asset class on the planet. One of the asset classes that would benefit most from inflation and to me, that, that, that kind of mixture of, of, of, you know, fundamentals and sentiment, it creates a very interesting opportunity for longterm investors now.

I don’t have a lot of interest in owning commodities directly, but owning commodity-based companies who companies who produce commodities or, you know, related to commodities is a much more interesting idea because those stocks are, you know, if there is a group of, value stocks in the us stock market, it’s these companies that are focused on commodity.

So what is the most important commodity on the planet? Well, right. What does another good c’mon what commodity, you know, aside from gold did very, very well from 2001 to 2008, nine, 10, when the dollar tanked it was oil price. So prices, you know, when, when not someone from 10, $20 a barrel to a hundred plus a barrel, a lot of, most of the time the oil price is just.

You know, inversion of, of the dollar. So dollar goes down while price goes up. So I do think we’re very close to a, if not already seen it. A terrific opportunity and energy. To me, the, we’re going to look back on this decision that S and P global lens, this map manage the, the Dow Jones industrial average, and they made that choice to kick out Exxon mobile, which has been in there for since the original Dow 30.

ExxonMobil’s one of the original doubt, 30 and, you know, because energy was too big of a waiting. In the Dow, according to, and compared to the S and P five. Hmm. Tech was going to be too small after Apple stocks, but so let’s add salesforce.com trading at a 0.5% free cashflow yield and get rid of Exxon mobile, which is paying an 8% dividend yield to me.

We’re going to look back at this and go, Oh my God, they did the exact. Opposite. And that’s exactly what all investors are doing right now. I want to own no energy and I want to be super heavy tech and I think probably. What investors should be doing is the exact opposite of that super underweighting tech today.

Overweighting energy. because I do think energy is going to, you know, is very undervalued right now. It’s out of favor and, with the macro dynamics for them, the dollar and stuff could probably be very supportive for oil prices. And for these stocks over the next. Five to 10 years.

Ben: [00:40:00] Okay. So on a longer term basis, I mean, short term momentum traders, like throw it all in Tesla or whatever these people do.

Right. But a longer term bearish on the dollar mean, and. All of these tech stocks and everything. So, so the, the value play there is more for these oil producing stocks, something like Exxon or, the spider XLE, I think. so these might be interesting plays, but with oil, I mean, one of the main headwinds and I haven’t done yet.

Jumped into this, that much would be like renewable energy. Right? So this is kind of guessing that we continue the way that we are with a lot of demand for oil. Do you think through those as risks as you’re kind of putting on these, these oil plays?

Jesse: [00:40:45] Absolutely. And to me, the way you make money in the market, this comes from a terrific book.

From Howard marks, the most important thing, terrific book, you know, the way to make money in the markets is you have to have a non-consensus view about value and you have to be right. And so what is the consensus today? The consensus today is I want to own alternative energy. I want to be ESG. I want to own Tesla.

and basically the consensus is that that, alter these alternative energies are going to dominate. And they’re going to take over and oil is going to go by by oils, there’s, the demand is going to kind of disappear. that’s what I believe is priced into the markets. So the only way only thing I need to, to make money in energy is that oil doesn’t go by, by if oil doesn’t go by by cause that’s what price pricing in right now.

If oil sticks around for another 10, 20, 30 years as some sort of an energy source, Then, then stocks or are under pricing that reality. And so to me, that’s, that’s how I look at it. I mean, it could be, it could well be true that, you know, and I actually don’t doubt it at all that alternative energy sources are eventually going into, but it’s, it’s all about the timeframe.

I think people are pricing in that. We’re not going to be five years from now. We’re not going to be using oil at all. And that to me is, you know, Ridiculous. We’re going to be still using well, how do you think people power their Teslas up with, you know, electricity that was generated through natural gas or some other type of thing it’s still mostly created.

But by those types of sources and, you know, wind and solar are nowhere close to being able to replace those, those types of energy. No, nuclear is another interesting option, right? And so this is another area where uranium stocks are, you know, been extremely cheap for a long time. I don’t own any of them.

I’m not betting on, you know, uranium and nuclear, but that’s another. Area where I think if you are ESG investor and you’re betting on renewables, that might be a great time to bet on nuclear because, those stocks are, I think still, probably very undervalued. And that might be the only bridge between, you know, the true bridge between, you know, fossil fuels and renewables.

Ben: [00:43:06] Yeah. That makes a lot of sense. so I’m curious and I’ve heard you talk. Briefly on it. what are your views on other alternatives outside of these things that we’ve been talking about? So you only have a finite resources where you can invest your, your investible cash, something like crypto completely, not a store of value, speculative asset.

What are your kind of views on that?

Jesse: [00:43:31] Yeah, no, I do think crypto is, yeah, just a, a tool for speculation. And I think it’s the reason, I don’t think it’s a store of value is because it is, it is manmade. You can talk about crypto, and I I’ve talked to some very smart people about this, for the past several years to try and understand crypto and for a time there, they were constantly coming up with new cryptocurrencies to own, right.

Versus Bitcoin and Ethereum, and then right. You get to doge coin and all these kinds of crazy things. And to me, that right there is a sign that, okay, well, what if they create a crypto that’s better than Bitcoin. That’s better than, you know, and. A lot of smart people say, Ethereum is, you know, is a better option than Bitcoin.

and so I’ve asked smart people in this. Well, I’ll just buy all of them, all of the new ones that are even just with Bitcoin forking into different slight variations on the original. They’re doubling the amount of Bitcoins in existence. Yeah. These Bitcoins are slightly different than these, but that’s not a store of value if you can just literally branch off and double the supply of something overnight because you have a disagreement in how Bitcoin should be managed.

And so you can’t do that. A store of value is something that is a finite resource and it’s not manmade in my, in my viewpoint. I do think there’s just way too much risk in terms of Bitcoin. I think I said in that macro voices interview, the history of technology is that somebody comes up with something and then somebody else one upset, several years later and of creates a better version of that.

I don’t see, why there won’t be a better version of the coin. And not just that, why there won’t be a better version that will actually be endorsed by central banks. And then controlled by central banks and managed according to their views on what a currency should be.

There are too many, too many what ifs there, for it to be something, you know, Gold’s been a store of value for human beings for 5,000 plus years. And, there’s nothing. To change that, that I can see on the horizon. So, I’d rather stick with the, the real thing than, you know, Bitcoin was created to try and be a digital gold.

You know, I I’d rather stick with the real thing.

Ben: [00:46:05] Nice. No, I’ve got another podcast coming up strictly more Bitcoin bullish. So I won’t dive down that rabbit hole. I think, I think the worry here is that, like you said, there’s a central bank digital currency and they take all of the characteristics of.

Bitcoin. And they push this out and this, the new digital dollar. And I think this is the, the inevitability that we’re going towards. You know, you can push monetary policy directly through, automatically you can have things that expire. So you have to spend them on certain things and this UBI could all be done so much easier.

So I think that’s where we’re going, which.

you know, Bitcoin could offer some alternative, some opt out to that sort of system, which is interesting, to say the least, but, yeah, I, I won’t go too far down that rabbit hole

Jesse: [00:46:57] that too, is that, you know, the, gold ownership in the United States in the past, there’s no reason why they couldn’t out well, you know, Bitcoin ownership once they create.

you know, a federally approved alternative, you know, and, and so I, I don’t know, there’s just too many, too many things like that. that make it, make it too risky for me that said, I know a lot of people who’ve done really, really well, and a lot of smart people that, that are bullshit and Bitcoin. So, you know, I’ve, I I’ve been very wrong on things like this before.

so I, I, I just think, you know, with, with, for me, I am kind of, geared towards, Far less speculation on things than things that I, I feel like, you know, I just look at all the great traders through history, great investors in history. And the first thing that, you know, play defense first, you know, Ben, Ben Graham even wrote about, you know, you want to.

Make sure your principal’s protected. and how do you do that through value investing? You do it through margin of safety. I’m gonna buy something cheaper than it is so that it turns out I’m wrong in this thing. I paid 50 cents for, and I thought it was worth a dollar. It turns out wrong and it’s really only worth 50 cents.

How much risk did I take? And I don’t have a way to apply that framework to Bitcoin. you know, to say, how do I protect my principle? How do I know this thing? Can’t go to, you know, down 90%. And I don’t have a way of, of, kind of giving myself that type of peace of mind.

Ben: [00:48:21] Yeah, that makes sense. And I mean, there, there’s incredibly smart people on both sides of it, right?

And this is why you have a market with buyers and sellers absolutely feel very strongly one way and very strongly the other. So there’s a buyer for every seller and vice versa. So I get this question a lot from. You know, I think about, I think about somebody like my dad, who is thinking about retiring is had money and equity, primarily in equities for the portion of his life.

Like most Americans own that owns a house. So he has that equity, but like for somebody like him, you know, Bonds are not an alternative. The 60 portfolio is dead. You know, how do you get an income?

But whenever you’re talking to people like this shorter timeframe need for liquidity, they want some yield.

What do you, what do you talk to them about? Like, where’s where’s the alternatives for something like this?

Jesse: [00:49:19] I think, you know, there’s, there are so many obvious alternatives to Tina. So 100% on the stock market, right? There’s so many less obvious alternatives to a 60 40 portfolio, but I think, you know, the one thing maybe the biggest mistake, investors are making today is, you know, focusing on the us equity markets, that diversification is so powerful.

And when you look at, you know, I would recommend, I recommended it for years. go look at MEB Faber’s global asset allocation. and he talks about what he shows you, what a really diversified portfolio looks like. And when you see that and you see the most aggressive asset allocators on the planet, maybe have 25, 30% of their portfolios in USF, not sure a wake up call too, to investors.

Cause I, you know, the average us investor probably has 60, 70, 80% of their portfolio in us stocks. And so when you tell somebody that and you go, you know what, you, you are. Twice as aggressive as the most aggressive, asset, asset allocator on the planet. I’m talking about the most successful asset allocation, David Swinson, Yale endowment, probably, you know, I think typically 30% in us equities today is closer to one, 2% or zero, but, for kind of a, for, a permanent portfolio, you know, he’s going to have 30% roughly in, in us stocks.

and then you can take. Those types of permanent portfolios, from Ray Daleo from all these different guys, none of them have anywhere close to 60, 70, 80% in us stocks. And the reason is because you’re putting all your eggs in one basket and yes, that’s how Stan Druckenmiller was so successful. He said, I’m going to put all my eggs in one basket.

I’m going to watch that basket super closely. And if the market starts to roll over. He’s going to get, he’s not only going to get out of the stock market, he’s going to get short. So how many people, you know, these typical American us investors have the ability to trade like Sandra and Noah, they just don’t.

And so there’s no reason at all to have a as little diversification as they do. So I, I think, you know, When you look at these things and you go, you know what, maybe one third of my portfolio in equities is where I should be in terms of volatility and you know, my, my, my temperament and my risk appetite, then maybe 15%, you know, half of that should be in U S and half.

That should be overseas equities. you know, so maybe you’re only 15% in us equities. Once you start looking at a diversified portfolio. So I think. That’s the first thing to introduce anybody to is that, you know, this whole idea of you need to put 60, 70, 80% of your money in the us stock market is, you know, is extremely risky, in any time at any given time.

And it’s never been more risky than it is today. So there are so many other asset classes to own. and, to build a truly diversified portfolio include, you know, means, yeah, reducing a lot of exposure to us equities and increasing it to a lot of these other things. We are talking about gold, foreign equities bonds, real estate, et cetera.

Ben: [00:52:32] Yeah, that makes a lot of sense. And then it’s, I it’s actually even more risky for that or right. For that, the average us investor who is receiving a U S dollar salary who owns a U S real estate. I mean, you are. Talk about all your eggs in one basket. I mean, it’s like working in Enron and getting all of your compensation through Enron style, right?

Like those people were decimated. So it’s the same. I have another podcast, all about flag theory, which is kind of global diversification, you know, owning property in different countries with exposure to different. Affects and all of these things. So it’s an interesting thought experience, experiment to go through.

my, my thoughts there though, like some of these other guys, they, they have access to private equity and VC and some things that are a little bit more difficult to get exposure to than the average investor. But you still think those there’s enough options to truly build, you know, a super diversified globally asset allocation with the tools that are out there.

Jesse: [00:53:32] I do. I think, you know, the, the, the good thing about this passive bubble is that it’s created a bunch of super low cost products that give you access to, you know, there’s, there’s an index for every country outside the United States. You know, there’s, there’s a. you know, X, you can buy an X us equity index.

you know, yeah. There’s all types of emerging. Some of my favorite, you know, I guess they’re not technically passive, but low cost index type of products or the fundamental index is created by Rob or not. At research affiliates. and it’s essentially a way to, put together an index portfolio, but instead of waiting by market cap, you’re waiting by, by fundamentals.

So you’re waiting by book value sales, you know, these types of things. So you’re not going to be buying the sun Microsystems. Putting, you know, a ton of your money into some Microsoft’s was at the top and you’re not going to be selling, you know, ExxonMobil today. You’re going to be probably having a much bigger, helping of Exxon mobile in that index today because it’s safe.

Those are still really high. And, you know, you’re not going to be buying tons more Apple. today because its valuation went up, even though its sales have been flat. So it’s a fundamental index to me makes, is a brilliant innovation. You can buy a fundamental emerging index, overseas index, fundamental U S index fundamentals, small cap.

And it’s basically just, I believe a much more efficient way of building an index. I think utilizing those types of products, you can get massive diversification, not just outside of the United States, but you can be more well-diversified within the U S because you’re not putting 26% of your money in the things you’re putting your, you know, that index, the fundamental index is going to be much more diversified in a market cap. Weighted, weighted index will be.

Ben: [00:55:20] Awesome. And I’ll definitely link that in the show notes, fundamental index portfolios. I haven’t looked into those. So I’m excited to go down that, that, so next question was more on following your Twitter and your blog. The breadth of information that you’re consuming.

So what, what tools do you use to stay on top of things within the financial markets? Because you, you cover a number of different things, obviously it’s from years of being in the business, but more for my own learnings. I mean you, but how do you do this?

Jesse: [00:55:52] Yeah, so it’s a, it’s a good question because I have spent years refining my, my daily routine.

So I have a number of blogs that I still follow just through an RSS feed, that, you know, I, I find value, in, but I think, I also use Apple news. you know, that’s curated to specific topics, that I like, but I think the most valuable thing that I’ve found over the last several years is, you know, I follow a thing.

Just about a hundred accounts on Twitter. And these are only people that I, you know, find, provide me with terrific. Whether it’s charts or articles or whatever. And then I found this app called Nuzzel and use Z E L. And nuzzle takes, all of those 100 accounts and it will show me the articles shared by those a hundred accounts and they’ll rank them by popularity.

So three of those people share the same article that comes up first. So it’ll give me, you know, like, 50 articles a day based on what my network is, is sharing and based on popularity. And then even more valuable than that sometimes is it takes those a hundred people and their network of people they follow.

And so there’s another, so I can see my, I can see the friends of friends. Yeah, all the news articles that those people are sharing. So basically Twitter has created a network for me, that’s kind of like a news gathering organization. And so when I go to this friends of friends on nuzzle, it shows me this whole, you know, fin twit network of people that, you know, that I value and that they value and the most important things they’re reading over the last 24 hours.

So that’s, that’s my secret.

Ben: [00:57:37] Awesome resource. No, I haven’t heard of that one. So definitely putting that on the list. The my worry, my biggest worry with Twitter is just stuck in my echo chamber. And this just is a, an accelerant for this echo chamber, aspect. I mean, if you look on my Twitter feed, I mean, everybody is short, the dollar.

Super long gold and they love big line like this. This is, this is the area that I play it. Right. So I always want the differing opinion. Somebody say, no, Bitcoin’s dumb. Like they’ll just fork it. Right. It’s not limited so

Jesse: [00:58:10] well, that’s, that’s you know, one of the things I use Twitter for too is for sentiment.

I mean, that’s one of the reasons why I think, you know, I’ve been short term bullish on the dollar and bearish on gold is because I think we did get sentiment got way too far extended and there was. Way too many dollars shorts right now. So, you know, when I say I’m embarrassed to die, I’m talking about the next year.

Well here’s, but we could have a good short term dollar rally that kind of coincides with this risk off period where you get people selling stocks, kind of going to the dollar as a safe Haven, again, over a short period of time. And that’s also why oil, you know, oil stocks are selling off as part of that trade also.

So, yeah, the short term dynamics, I think Twitters. Fantastic for, for cinnamon. Also a lot of the stuff I’ll tweet, you know, it’s not even stuff that I believe a lot of the times it’s just quotes that I’ll put out there that I find interesting. And I want to see people’s reactions to them, you know? And they say, Hey, when people like get super riled up about something, I know, okay, well, sentiments gone pretty extreme to one side of the other.

On this topic. So, yeah, we saw it, especially when it comes to the dollar. It’s fascinating to watch. We have that dollar spike, you know, back in March or whatever, when the stock market tanked and some people just got so bullish, you know, doc here comes the huge dollar blow off, right. And yeah, the last two, three weeks, we’ve seen people getting in a, like when people start patting themselves on the back too much for being bearish, the dog, you know?

Okay. It’s time for a counter-trend rally, at least. So yeah. Twitter is a terrific sentiment tool for

Ben: [00:59:41] it. Is I just always, you know, is this reality or it’s just my tiny little echo chamber. So everybody’s bearish on the dollar. Is that actually representative of the greater investor sentiment? I mean, I dunno.

Jesse: [00:59:57] Right, right. Well, that’s also what I do so much reading too, is because, you know, when you see the mainstream media, you know, start coming in and saying, you know, the da, the da, and we, we did see that over the last couple of weeks, we saw a lot of the mainstream media questioning, the dollar’s reserve currency status, you know, so mainstream media is, is for me an important sentence signal to cause the dollar is down, you know, Five six, 7%.

And it’s going to lose its reserve currency status. Right. That’s a little panicky it’s got, you know, and so I, those are typically Mark the short term bonds, but yeah, you’re right. I mean, I it’s hard for me because everybody I follow on Twitter. I have huge respect for. And so when they are all kind of sharing, I’ve been, I’m like, they’re probably right.

You know, is this a contrarian view? But this is just, I only follow contrarians. So it’s tough. It’s tough. But for me, I find much more value in following those people and hearing their ideas and input than I otherwise

Ben: [01:00:54] would. Nice. So I’ll, I’ll definitely link your Twitter on, in the show notes and felt a report.com.

But, last question. if you could only follow three Twitter accounts and not use a cool tool, like nuzzle, who would you follow and why?

Jesse: [01:01:10] Oh, man. Who would I follow?

Ben: [01:01:13] Put those guys on the spot?

Jesse: [01:01:15] you know, Jason, Jason, gepford a sentiment trader is somebody that I’ve followed for a long, long time. he does some just brilliant sentiment work.

gosh, who else? Let me just look and see who I’m following here real quick. I gotta go back to the people I’ve started following a long time ago. Helene Meisler are also is another one who I think she’s just brilliant. chartist. She, she’s been hand drawing charts for decades and just has her finger on the pulse of the market that, you know, that to me is, is invaluable. and then third. Gosh, I probably need to just say my friend, Peter Atwater, Peter is, you know, a professor of social work in omics and just his take.

He has such a unique take on, on, how things are unfolding in the markets. And. And how it relates to sentiment, not just investor sentiment, but you know, popular sentiment, in consumer sentiment and these types of things, he just, he has such a unique perspective is so under followed. I mean, he’s one of the most brilliant people I know.

So yeah. Go follow Peter Atwater. but yeah, those three to me are three of the most valuable that I, that I follow.

Ben: [01:02:28] Awesome. I’ll I’ll, I’ll definitely link all those guys. Yeah. I’m surprised to see two out of the three as charters. I mean, coming from my CFA background, I mean, charting is just the voodoo witchcraft, maybe, a tactical shift, but, But that’s, that’s quite surprising, but I’ll tell you that

Jesse: [01:02:45] Helene is a pure chartist. I would say Jason is more a statistician. his more just sentiment related statistics and price related statistics. I mean, there’s so many people that do it now. There’s so many imitators, but Jason’s been doing it for 20 plus years and he’s just, he’s got it. So dialed into what’s valuable information.

What’s not valuable information. And so, yeah, I w I wouldn’t throw him in the charting category so much as this statistics category.

Ben: [01:03:13] Awesome. Well, Jesse really appreciate you taking all the time today. what can you leave my listeners with? Where do you want to send them find out more about you and what you doing?

Jesse: [01:03:24] Well, yeah, I mean, you know, you probably get a good idea of what I’m thinking about and reading and to just from following my Twitter accounts, just to at Jesse Felder, I, I basically, you know, I told you my routine every morning, I go through all those things and I, and I pick out the articles that I find that.

whether it’s important information or it’s important, you know, sentiment signal through, you know, from several media outlets or certain dynamics going on, I’m trying to track them narratives really that are driving the market and, and, and, and what. What stage those narratives are in, in their life cycle.

You know, a state, a narrative that’s kind of an early life cycle. Something you can trade off of and vice versa. If something is getting ready to, you know, meaningful to the market, that’s, that’s an important signal too. So, yeah, my, my Twitter account might seem like I’m not explicitly. Saying those things, but I’m sharing those, those articles and charts and things because it’s very highly relevant to a narrative that I’m tracking that I think is important to, markets at present. So

Ben: [01:04:28] awesome. Well, it’s definitely a treasure trove of information and a highly curated of all the different articles that you’re going through. So we all appreciate that. That’s for sure. And I’ll also link, I mean, you have a newsletter that comes out. on the weekends at thefelderreport.com

Jesse: [01:04:44] like five things, you know, that I found during the week.

And I put him in that free Saturday morning email, so they can just fill out a report.com. You can sign up for that and see what five things I thought were most important from the, from the last week. Awesome.

Ben: [01:04:58] Well, Jesse really appreciate you coming on, lots of great information in this. I think my listeners are really gonna love it.

Jesse: [01:05:03] Awesome. It’s a lot of fun. Thanks for the invite. Thank you.

Ben: [01:05:07] There you have it. Thank you for listening. I really appreciate your support. Show notes, transcript links, and more can be found on our website at all. Asset allocation.com. If you’d be so kind, please share this with anyone you think might be interested or get some value from this conversation.

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