Supposed monetary hawk Kevin Warsh, who was officially sworn in as the 17th Fed Chair earlier this week, will now face the dilemma of staying true to his hawkish roots or caving to his unabashed high-rate hating President. That is, of course, unless there’s a deeper plan at play…
Last night, Cornell professor Dave Collum hosted Michael Lebowitz and Stephanie Pomboy for a deep dived into ‘How F***ed Markets Are’ where Dave posited the theory that Warsh man be a demolition man for a managed crash.
Collum and co. also talked about the insane disconnect between the economy and financial markets… and why Pomboy has increasingly abandoned financial assets altogether in favor of gold and hard assets.
Dave’s Fed truther theory and other highlights from last night below:
Retail Retards
Collum warned that modern markets have become completely detached from traditional valuation discipline… but that reality will eventually set in.
“It’s my assertion that probably greater than 50% of the investors in the world don’t understand what valuation means… Everything’s a Bitcoin price now.”
Standard valuation metrics have compounded roughly 4% annually for 45 years and are now firmly in “the nosebleed section,” yet “nobody cares,” per Collum.
Classic warning indicators are now near historic extremes. Lebowitz noted that “CAPE is near its all-time high. It’s above the 1929 level and just short of the dot-com level.” He argued the bigger danger may actually be hiding in supposedly “safe” stocks like Walmart and Costco.
Pomboy has opted out of the mania altogether. How? Real assets.
“Markets can go on longer than you can remain solvent betting against it…. I finally just sort of resigned myself to buying gold… At the end of the day I have been outperforming those markets by only gold.”
Hellbound and Down 