Forward Guidance

Latest Episodes:

Everything You Need To Know About The Fed’s Meeting | Danielle DiMartino Booth Dec 12, 2022

Show notes

Danielle DiMartino Booth, CEO & Chief Strategist at Quill Intelligence, joins Jack to share her views on the upcoming extremely busy week, which sees the release of November’s inflation (CPI) data on Tuesday and the culmination of the Fed’s FOMC meeting on Wednesday. Filmed the afternoon of Monday, December 12.

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Market commentary, charts, degen trade ideas, governance updates, token performance, can’t-miss-tweets and more. Subscribe to the Blockworks Research “Daily Debrief” Newsletter: https://rb.gy/feusos

Timestamps:

(00:00) Intro

(01:04) Preparing For This Week's Fed Meeting

(04:37) The Dot Plot

(13:50) What Are The Odds Of A Hidden Pivot?

(17:42) The Job Market

(24:54) How Hot Will Inflation Be?

(30:21) Quantitative Tightening (QT)

(40:46) The Housing And Auto Market Is Getting Even Worse

(45:40) Recession

(48:08) Consumer Spending Is Falling

(51:33) Can Services Save Us?

Felix Zulauf: Credit Meltdown Will Force The Federal Reserve To Backtrack On Tight Money Policy Dec 09, 2022

Show notes

Felix Zulauf, renowned macro investor and founder of Zulauf Consulting, returns to Forward Guidance to share his market outlook for 2023 and beyond. Zulauf argues that recessions in China and Europe will weaken corporate earnings, and that as the U.S. economy also slows down, pessimistic earnings guidance from companies will quickly catalyze severe stock market declines. However, he thinks that the bear market will likely end in early 2023, because a credit event (likely in China) will force central banks - most notably the Federal Reserve - to stop tightening monetary policy, and that this “pivot” will arrest the fall in equity prices. Zulauf tells Jack Farley that China’s growing trade dominance is augering profound geopolitical and economic changes, and he shares his view on sovereign bond yields, cryptocurrencies, and commodity prices. Filmed on December 7, 2022

Zulauf Consulting is a boutique research and consulting firm that offers investment advisory services to institutional investors and family offices. For more information, go to https://www.felixzulauf.com/

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This episode is sponsored by Curve. Curve is unlike any other credit card. It gives you the power to connect multiple credit and debit cards into one, convert your cashback into crypto rewards, Go Back in Time ®, create Smart Rules, and more. Apply now through https://link.curve.com/forward_guidance, you’ll earn $20 in Curve Cash after your first transaction. So sign up today! Terms and conditions apply.

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Timestamps:

(00:00) Introduction

(00:27) Profound Geopolitical Change

(05:51) Stock Market Outlook

(9:31) Potential Credit Meltdown In China

(18:06) Curve Sponsor Reading

(19:11) China's Stock Market Does Not Represent The Chinese Economy

(22:09) Why Is The Euro So Weak?

(24:09) The U.S. Dollar

(26:57) Felix Zulauf's Outlook on Treasury Bonds

(35:27) The Federal Reserve Will Pivot In Early 2023

(39:22) The Final Phase Of The Equity Bear Market

(45:12) Crypto

Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets.

David Rubenstein, Billionaire Investor Who Hired Jay Powell, On What Makes A Great Investor Dec 08, 2022

Show notes

Today Jack speaks to a true titan in the investment business. David Rubenstein is the co-founder and co-chairman of The Carlyle Group, a global investment firm with over $360 Billion in assets under management, and he joins Forward Guidance to share lessons from his latest book, “How To Invest: Masters On The Craft,” in which he spoke to legendary investors such as Stan Druckenmiller and Jim Simons about the keys to their success.

Link to David Rubenstein’s book: https://www.amazon.com/How-Invest-David-M-Rubenstein/dp/1982190302

Link to David Rubenstein’s interview with Fed Chair Jay Powell in 2021: https://www.youtube.com/watch?v=5Nwf_VySYFU&t=601s

Link to David Rubenstein’s interview with Fed Chair Jay Powell in 2019: https://www.youtube.com/watch?v=SLE3eRMFUJo&t=17s

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Timestamps:

(00:00) Introduction

(01:25) What Makes A Great Investor?

(04:16) David Rubenstein's Journey Into Private Equity

(09:06) Importance Of Getting Involved In On The Ground Floor

(11:42) Fundraising

(19:22) Inflation

(21:05) The Business Cycle

(24:22) Venture Capital and Technology Valuations

(27:36) Economic Outlook

(29:22) How High Will The Federal Reserve Hike Interest Rates?

Cash Is King In Multi-Year Recessionary Bear Market | Chance Finucane Dec 05, 2022

Show notes

Chance Finucane, chief investment officer at Oxbow Advisors, joins Jack to discuss his investment outlook at this current point in the business cycle. Finucane argues that the U.S. is at the beginning of a multi-year economic slowdown that will see corporate earnings dwindle materially across many sectors, and that accordingly preservation of capital is top priority.

Finucane and Farley discuss the housing and auto market, outlook on fixed-income and the Federal Reserve, as well as individual stock ideas. Filmed on November 21, 2022.

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Get top market insights and the latest in crypto news. Subscribe to Blockworks Daily Newsletter:

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Timestamps:

(00:00) Introduction

(00:26) Outlooks on Growth and Inflation

(02:39) The Housing Market Recession

(05:33) The Auto Market

(08:05) General Investment Outlook

(10:49) MegaCap Tech Stocks

(13:19) Banks and Other Financial Stocks

(14:15) Fixed-Income Outlook

(16:49) Is Sentiment Too Bearish?

(19:34) How Much Will Corporate Earnings Grow In 2023 (if at all)?

(22:19) Curve Ad

(23:21) How High Will The Fed Hike Interest Rates?

(27:09) Municipal and Investment Grade Corporate Bonds

(28:34) Even More Bearish Than Summer 2022

(33:16) Long-Duration Treasurys

(34:41) Sectors and Individual Stocks

(36:31) Will Companies Be Able to Pass Costs Onto Consumers In 2023?

(42:56) Energy

(44:32) About Oxbow

The Car Market Is Crashing | Paul Hodges Dec 01, 2022

Show notes

To get $1,000 off The pH report and receive a free sample report, email phodges@new-normal.com or jack@blockworks.co, or visit https://new-normal.com/the-ph-report-overview/.

Having shared his dire warnings about the chemicals market, Paul Hodges, and author of The pH Report and chairman of New Normal Consulting, returns to Forward Guidance to share equally grim tidings about the global automotive industry, which Hodges argues is entering a severe recession. Hodges notes that sales volumes and car prices are falling sharply around the world, and he discusses cyclical as well as secular themes in Asian, European, and American automobile markets.

Disclosure: The pH Report is a research partner of Forward Guidance. Blockworks receives a share of proceeds for each conversion to The pH Report. For any questions, email phodges@new-normal.com or jack@blockworks.co.

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Get top market insights and the latest in crypto news. Subscribe to Blockworks Daily Newsletter:

https://rb.gy/5weeyw

Market commentary, charts, degen trade ideas, governance updates, token performance, can’t-miss-tweets and more. Subscribe to the Blockworks Research “Daily Debrief” Newsletter:

https://rb.gy/feusos

Timestamps:

(00:00) Introduction

(00:50) The Health Of The Global Car Market

(05:08) The U.S. Auto Market

(13:49) Car Values Are Falling - What's Next?

(24:32) Slowdown in Chinese Auto Market

(30:30) Tesla

(33:43) Autonomous Vehicles (AVs) - When WIll They Become Mainstream?

(45:23) Europe's Auto Market

(51:23) Investing In Electric and Autonomous Vehicles

(01:06:51) China's Relationships with Non-Chinese Automakers

(01:10:33) The pH Report As a Research Partner of Forward Guidance

(01:14:05) The Chemicals Market Remains Stupendously Bearish

FTX and “The Money Noose”: Scott Skyrm On The Fall of MF Global Nov 29, 2022

Show notes

Scott Skyrm, Executive Vice President in fixed income and Repo at Curvature Securities, joins Jack Farley to share insights from his book “The Money Noose: Jon Corzine and the Collapse of MF Global.” Scott and Jack explore the startling parallels between the fall of the futures brokerage MF Global in 2011 and the recent collapse of cryptocurrency exchange FTX: the merging of proprietary trading with a brokerage, the illusion of “risk-free” trades funded with borrowed money, the liquidity mismatch between liabilities and assets, the misuse of client funds, the stubborn CEO with political connections and heavy risk appetite who is surrounded by “yes men,” and an alleged acquisition by a supposed savior that is later terminated (Binance for FTX, Interactive Brokers for MF Global).

Jack explains why it is his opinion that the fall of FTX is much “worse” than the the MF Global, in that at MF Global the use of customer funds was a last resort, where in the case of FTX, it is Jack’s reading that FTX likely misused (or at least “mislabelled) its customer funds well before its liquidity crisis. Lastly, Scott shares his outlook on the repurchase (“repo”) markets in 2022, as well as the Fed’s dilemma between price stability and financial stability.

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Get top market insights and the latest in crypto news. Subscribe to Blockworks Daily Newsletter:

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Timestamps:

(00:00) Intro

(01:18) Is FTX The New MF Global?

(02:24) MF Global's Transformation After 2008

(11:07) Can Broker Dealers Touch Client Funds?

(20:11) Lack Of Controls At MF Global And FTX

(23:29) Cross-Margining

(32:52) MF Global's Risky Repo-To-Maturity Trades

(40:54) The Risks Of Repo-To-Maturity Trades

(43:19) FTX's Imaginary Tokens: FTT & SRM

(47:40) MF Global's Ultimate Fate

(53:59) The Fed's Dilemma

(58:51) The Repo Market in 2022

CeFi Crypto Contagion Is Just Getting Started, Says Analyst Who Predicted FTX's Fall Nov 28, 2022

Show notes

James Block, author at Dirty Bubble Media, joins Jack to explain the knock-on effects of the demise of the crypto exchange FTX.

James is an amateur crypto researcher who saw in FTX and Alameda Research what many crypto professionals missed: hidden leverage, inflated assets, and in some cases, outright fraud.

He now shares his view on potential contagion to Gemini, Genesis, Digital Currency Group (DCG), BlockFi, and other firms in the crypto ecosystem.

James’ writings at Dirty Bubble Media can be found here: https://dirtybubblemedia.substack.com/

James’ piece on Alameda Research: https://dirtybubblemedia.substack.com/p/is-alameda-research-insolvent

James’ piece on Digital Currency Group (DCG): https://dirtybubblemedia.substack.com/p/digital-currency-grift

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___

Get top market insights and the latest in crypto news. Subscribe to Blockworks Daily Newsletter:

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Timestamps:

(00:00) Intro

(00:45) "Is Alameda Research Insolvent?"

(03:02) Red Flags With Alameda & Celsius

(12:35) Binance

(15:01) Crypto Contagion

(19:13) Curve Ad

(20:16) Digital Currency Group (DCG) and Genesis

(35:16) Where Did Crypto Yield Come From?

(40:00) Was The $8 Billion Ever At FTX To Begin With?

(45:11) What's The Next Shoe To Drop?

Liquidity In Crypto Is Declining | Scott Freeman Nov 24, 2022

Show notes

Scott Freeman, co-founder and partner at JST Capital, a financial services firm focused 100% on digital assets, joins Jack to explain just what the hell is going on in crypto after the spectacular collapse of Sam Bankman-Fried’s (“SBF”) crypto empire, consisting of the crypto exchange FTX and the hedge fund Alameda Research. Freeman tells Jack that he judges the state of the crypto market using three key factors: liquidity, leverage, and volatility. Liquidity falls after big market events, so liquidity is poor and might even get worse in the short-term. Freeman argues that volatility might fall, however, as leverage is wrung from the system, and he also shares his fall on the crypto lender Genesis, whose fate hangs in the balance, as well as the Grayscale Bitcoin Trust ($GBTC), which is owned by the same parent company, Digital Currency Group (DCG). This interview was filmed the afternoon of November 22nd, 2022.

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Join Kraken, Binance, Arrington Capital, and 2000 others in heading to Dubai this fall for Algorand's DECIPHER conference, happening November 28-30. Tickets are available now -- use code DecipherFam22 for 25% off: https://www.decipherevent.com

___

Get top market insights and the latest in crypto news. Subscribe to Blockworks Daily Newsletter:

https://rb.gy/5weeyw

Market commentary, charts, degen trade ideas, governance updates, token performance, can’t-miss-tweets and more. Subscribe to the Blockworks Research “Daily Debrief” Newsletter:

https://rb.gy/feusos

Timestamps:

(00:00) Intro

(00:35) Scott Freeman's Background

(04:27) Early Trading in Crypto in 2014 and 2015

(09:06) Crypto in 2020

(12:01) Crypto Liquidity Has Declined In 2022

(15:25) Leverage, Futures, and Options in Crypto

(19:23) Where Does Yield Come From?

(20:42) Was the Fall of Celsius Surprising?

(22:07) Algorand Ad

(23:52) Alameda & FTX

(29:41) The Myth of Sam Bankman-Fried

(34:58) Credit Risk on CeFi Crypto Exchanges

(39:06) Cold Storage and Decentralized Exchanges ("DEX"es)

(40:13) General Market Outlook

(42:30) Genesis, Digital Currency Group (DCG), and Grayscale Bitcoin Trust (GBTC)

(49:07) Is There A Silver Lining?

Learning From Market Tremors | Hari Krishnan Nov 21, 2022

Show notes

Hari Krishnan, head of volatility strategies at SCT Capital, joins Jack for a wide-ranging discussion on central banks, derivatives, and market structure. Hari shares his knowledge on everything from interest rate swaps to the demise of FTX, and he argues that short-expiry options are structurally cheaper than options with longer-dated tenors. Lastly, Hari and Jack exchange thoughts on what it means to attain true expertise in a specific market discipline.

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Hari Krishnan’s book, “Market Tremors”: https://rb.gy/4l3yhj

This episode is sponsored by Curve. Curve is unlike any other credit card. It gives you the power to connect multiple credit and debit cards into one, convert your cashback into crypto rewards, Go Back in Time ®, create Smart Rules, and more. Apply now through https://fgpodcast.link/curve, you’ll earn $20 in Curve Cash after your first transaction. So sign up today! Terms and conditions apply.

Get top market insights and the latest in crypto news. Subscribe to Blockworks Daily Newsletter:

https://rb.gy/5weeyw

Market commentary, charts, degen trade ideas, governance updates, token performance, can’t-miss-tweets and more. Subscribe to the Blockworks Research “Daily Debrief” Newsletter:

https://rb.gy/feusos

Find out more about the Blockworks video editor role here: https://blockworks.co/careers/

Timestamps:

(00:00) Introduction

(01:24) “Dominant Agents" In Finance

(04:49) Are Central Banks Really That Powerful?

(13:26) The Shadow Banking System

(17:28) The Effect Of Interest Rate Changes By Central Banks

(19:12) Curve Ad

(25:05) Why Are Swap Spreads Negative?

(27:16) Crypto Contagion & The Fall of FTX

(38:56) Leverage Within Crypto

(42:45) Anti-hedging In Bitcoin Miners

(44:36) Volatility In 2022

(58:08) The Next Phase Of This Bear Market

(01:04:27) The Role Of Macro

Joseph Wang & William White: Mammoth Interest Rate Hikes Are Causing Trouble In Sovereign Debt Nov 17, 2022

Show notes

Today Jack welcomes William White, senior fellow at the C.D. Howe Institute, and Joseph Wang, former senior trader for the New York Federal Reserve.

They discuss why economic forecasts are so often wrong, how the world can escape the “debt trap,” and how central bankers face a trade-off between price stability (low inflation) and financial stability.

William White’s work can be found here: https://williamwhite.ca/

Joseph Wang’s writings can be found here: https://fedguy.com/

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Academic papers referenced:

"Where Has All the Liquidity Gone?" by Raghuram Rajan and Viral Acharya: https://rb.gy/n47fah

"Why Do We Think That Inflation Expectations Matter for Inflation? (And Should We?)" by Jeremy Rudd: https://rb.gy/4wjzx8

"Some Unpleasant Monetarist Arithmetic" by Thomas J. Sargent & Neil Wallace: https://rb.gy/53kikq

William White's recent presentation on the future of policy modelling:

https://rb.gy/robwk2

Get top market insights and the latest in crypto news. Subscribe to Blockworks Daily Newsletter:

https://rb.gy/5weeyw

Market commentary, charts, degen trade ideas, governance updates, token performance, can’t-miss-tweets and more. Subscribe to the Blockworks Research “Daily Debrief” Newsletter:

https://rb.gy/feusos

Find out more about the Blockworks video editor role here: https://blockworks.co/careers/

Timestamps:

(00:00) Introduction

(01:09) Looking Back At 2022

(04:20) Quantitative Tightening (QT) is Causing Disruptions

(11:55) "The Central Bankers Have Made A Profound Ontological Error"

(23:17) Does Fed Chair Jay Powell Pay Attention To Economic Models?

(25:25) Algorand Ad

(27:09) If Inflation Is Supply-Side Driven, What Should Central Bankers Do?

(40:43) The Debt Trap

(46:04) Powell Is Not Worried About a Recession - Is This A Mistake?