The Breakdown

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Why Buffett’s Bearishness Should End V-Shaped Recovery Talk May 05, 2020

Show notes

One month after the bankruptcy of Lehman Brothers in 2008, Warren Buffett wrote an Op-Ed saying that he was buying stocks. Yet during the Coronavirus crisis, he is sitting firmly on the sidelines.

On Saturday night, the “Oracle of Omaha” spoke for 4.5 hours in the first ever virtual version of the Berkshire Hathaway annual shareholders meeting - an event which some have called the “Woodstock of Capitalism.”

On this episode, NLW examines some of the key topics of the presentation, including:

Why Berkshire sold their entire $6.5B stake in the airline industry
Why they were sitting on $137B in cash
Why they haven’t made any investments
How the Fed gave companies better terms than they were willing to

It was hard not to watch the presentation and conclude that Buffett feels that there are simply too many unknowns in the world going forward to feel comfortable doing much in the market right now.

The Breakdown Weekly Recap | May 2 2020 May 02, 2020

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The week's episodes in one long run.

Monday | Bitcoin vs. QE Infinity: The 4 Archetypes Of The Halving Debate
Tuesday | The Mass Surveillance Machine, Feat. Maya Zehavi
Wednesday | When Currencies Fail: A Primer on the Crisis in Lebanon
Thursday | From Corrupt To Broken: An Insider’s Analysis Of The Fed, feat. Danielle DiMartino Booth
Friday | Why The Dollar Has Never Been Stronger Or More Set Up To Fail [Money Reimagined Pt. 1]

Why The Dollar Has Never Been Stronger Or More Set Up To Fail [Money Reimagined Pt. 1] May 02, 2020

Show notes

The first of a 4-part docu-style series on the battle for the future of money.

In this first episode of Money Reimagined, we look at:

Why US markets took so long to react
How the stock market became a political utility
Why, even before the crisis, “increasingly exotic forms of quantitative easing” were inevitable
Why the bailouts have some investors accusing our entire market of being cronyism rather than capitalism
What unlimited money printing means for the US dollar.

Featuring insight from Matthew Graham, Caitlin Long, Scott Melker, Kevin Kelly, Ben Hunt, Luke Gromen, Travis Kling, Mark Yusko, Anthony Pompliano, Jared Dillian, Dave Portnoy, Michael Casey, Preston Pysh, Peter Zeihan

Music by DJ J-Scrilla "Faith In My Money (Money Printer Go Brrr)" from the “Sound Money” album.

From Corrupt To Broken: An Insider’s Analysis Of The Fed, feat. Danielle DiMartino Booth May 01, 2020

Show notes

Danielle DiMartino Booth is the CEO and Chief Strategist of Quill Intelligence. Before that, however, after correctly predicting the mortgage meltdown, she was called upon to serve and spent 9 years as an advisor to the President of the Federal Reserve Bank of Dallas. That experience led her to write “Fed Up: An Insider's Take on Why the Federal Reserve is Bad for America.”

In this episode, Danielle and NLW discuss:

How the Fed went from simply corrupt to corrupt and broken
Why we’ve been living through the largest experiment in monetary policy history
Why interest rates are the lowest they’ve been in 5000 years
Why COVID-19 was the pin, not the balloon
Why current Fed action compromises the Fed’s independence
Why the market structure incentivizes consumption and risk investment over savings
Why risk investments have ceased to be risky because of Fed backstopping
Why a key concern going forward is a second wave of COVID-19 layoffs in industries beyond the obviously impacted

When Currencies Fail: A Primer on the Crisis in Lebanon Apr 30, 2020

Show notes

The Lebanese pound has lost at least 50% of its value since last year. 220,000 people have lost their jobs. Food prices are up 58%. An estimated 75% of the population needs assistance of some kind. And over the last two nights, at least a dozen banks have been torched by protesters.

The catalyst? Not coronavirus, but a massive dollar shortage that is destroying an economy that relies on inflows of USD to function.

In this episode, NLW breaks down how Lebanon models what it looks like for a currency to fail, and why this likely isn’t the last emerging market currency to experience a similar crisis in the months to come.

The Mass Surveillance Machine, Feat. Maya Zehavi Apr 29, 2020

Show notes

As the COVID-19 crisis rages, it takes on new economic and political dimensions. The frames for many of the most important questions for the next decade are being set now, in this moment.

On this episode of The Breakdown, NLW is joined by Maya Zehavi, a long-time blockchain consultant known for her insightful domain-spanning takes.

They discuss:

How the COVID-19 health crisis overlapped with a political crisis in Zehavi’s home country of Israel
Why governments use times of crisis to take extraordinary powers
How contact tracing apps have become a battleground for mass surveillance
Why the shift to localism from globalism creates new challenges
How the problems distributing stimulus are shaping the conversation around central bank digital currencies

Bitcoin vs. QE Infinity: The 4 Archetypes Of The Halving Debate Apr 27, 2020

Show notes

The bitcoin halving is just two weeks away. While the COVID-19 crisis pushed attention off the momentous event for a while, the discussion is coming back fast and strong. Google searches for the bitcoin halving already exceeding the 2016 peak, despite almost no mainstream media coverage.

In this episode, NLW breaks down 4 archetypes of people within the larger debates around the bitcoin halving:

Speculators - those who flock to Twitter to engage in endless rounds of debate around the efficient market hypothesis and whether the halving is priced in or not
Fundamentals - those who believe that what matters about the halving isn’t the short-term price movement but the fundamental decrease in supply
Miners - those who have to actually figure out how to make their business model work in the context of reduced issuance
Symbologists - those who are focusing on the significance of bitcoin’s issuance reduction coinciding with QE infinity

The Breakdown Weekly Recap | April 25 Apr 25, 2020

Show notes

The full week's content in a single convenient long-run episode.

Monday | Bearish or Bullish? What Oil, DeFi Hacks and Cash Hoarding Tell Us About Markets
Tuesday | From Proof of Health to UBI: How Everything Changes Post COVID-19, Feat. Joe McCann
Wednesday | The History of the Dollar System From Bretton Woods to QE Infinity, Feat. Luke Gromen
Thursday | We Don’t Need Big Brother To Beat This Virus
Friday | Why Bitcoin Is Freedom Money, Feat. Yan Pritzker

Why Bitcoin Is Freedom Money, Feat. Yan Pritzker Apr 24, 2020

Show notes

Yan Pritzker is the CTO and cofounder of Swan Bitcoin, an automated bitcoin only investing app aiming to be the best onramp to bitcoin. He is also the author of Inventing Bitcoin.

On this episode, he and NLW discuss:

How immigrating from the Soviet Union taught Yan about capital controls
Buying bitcoin at $30 in 2011
Why the type of capital available shapes what type of startups entrepreneurs found
Why venture capitals focused investments away from bitcoin
The emergence of a bitcoin only startup scene
Starting a startup during the COVID-19 crisis
Why bitcoin’s scarcity is its most important property

We Don’t Need Big Brother To Beat This Virus Apr 23, 2020

Show notes

One of the key aspects of most plans to reopen the economy is digital contact tracing. This would be an apparatus whereby mobile phones kept track of the other mobile phones they had been physically proximate to, so that if someone were diagnosed with COVID-19, the at-risk people they had been in contact with could be notified. Apple and Google have proposed one plan while a European consortium is working on another.

At the center of the issue is whether contact tracing can be done in a way that doesn’t violate privacy and doesn’t open a Pandora’s box of new issues around the data governments have on their citizens.

Today’s episode of The Breakdown explores the crypto community’s response to contact tracing and why we don’t need big brother to beat the virus.

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