Business

The Julia La Roche Show

Julia La Roche brings her listeners in-depth conversations with some of the top CEOs, investors, founders, academics, and rising stars in business. Guests on “The Julia La Roche Show” have included Bill Ackman, Ray Dalio, Marc Benioff, Kyle Bass, Hugh Hendry, Nassim Taleb, Nouriel Roubini, David Friedberg, Anthony Scaramucci, Scott Galloway, Brent Johnson, Jim Rickards, Danielle DiMartino Booth, Carol Roth, Neil Howe, Jim Rogers, Jim Bianco, Josh Brown, and many more. Julia always makes the show about the guest, never the host. She speaks less and listens more. She always does her homework.

Latest Episodes:

#173 Dave Collum On Why We’re Headed For A 40-Year Bear Market Jun 04, 2024

Show notes

Dave Collum, Professor of organic chemistry at Cornell University and Zero Hedge Contributor, joins The Julia La Roche to share his views on the economy and markets. In this episode, Professor Collum makes a case that the market today looks “more insane than the dot-com bubble” and why we could be headed for a 40-year bear market.

Links:

Twitter/X: https://x.com/DavidBCollum

Year-end review: https://peakprosperity.com/dave-collums-2023-year-in-review-down-some-dark-rabbit-holes/

Timestamps:

0:00 Intro and welcome Dave Collum

1:18 Lessons in chemistry

7:00 Investing — bonds, equities, gold

9:10 Gold

14:47 Elizabeth Warren

17:15 Financial crisis

20:13 Case for a 40-year bear market

21:30 Macro view — about to start a serious downturn and we’ve had no pain

29:30 Demographics

30:58 Tailwinds

33:20 BRICs

36:40 Election

42:02 How do you prepare for this macro environment + bear market thesis + end of American experiment

45:00 Prepper

47:19 Bitcoin

49:08 Performance this year — ‘an old man’s portfolio’

51:23 Not your typical Ivy League professor + campus culture today as someone who is “Trump tolerant” + cancel culture

1:04:37 Optimism

1:11:58 Closing

#172 John Cochrane On The Fiscal Theory Of The Price Level, Causes Of Inflation, And The Need To Stop Throwing Money Down Trillion-dollar Rat Holes May 23, 2024

Show notes

John Cochrane, the Rose-Marie and Jack Anderson Senior Fellow at the Hoover Institution and former professor of finance at the University of Chicago Booth School of Business and, before that, the Department of Economics, joins Julia on episode 172. Professor Cochrane is the author of The Fiscal Theory of the Price Level book, and he writes the Grumpy Economist blog. and In this episode, Professor Cochrane discusses the current state of the US economy, the fiscal theory of the price level, the causes and challenges of inflation, and the concerning levels of government debt. He emphasizes the need for supply-side efficiency and fiscal discipline to sustain economic growth and control inflation. Cochrane also highlights the limitations of the Federal Reserve's interest rate policy and the importance of responsible fiscal policy in addressing the fiscal picture. He suggests reforming the tax code, social programs and reducing middle-class subsidies are necessary to ensure long-term sustainability.

Cochrane concludes by emphasizing the need to pay attention to incentives and the interconnectedness of various policies. He also mentions the potential of AI and biotech to drive future growth and warns against stifling innovation.

Takeaways:

The US economy is currently experiencing low unemployment and a bout of inflation caused by government stimulus.
The fiscal theory of the price level explains that money, government debt, and inflation are interconnected, and the quantity of money and government bonds both impact inflation.
The Federal Reserve's interest rate policy has limitations in controlling inflation, and fiscal policy plays a crucial role in addressing inflation and government debt.
To fix the fiscal picture, it is necessary to reform the tax code, social programs, and reduce middle-class subsidies to ensure long-term sustainability.
Responsible fiscal policy, economic growth, and steady primary surpluses are essential to control inflation and maintain a stable economy. The US economy may be more fragile than it appears, with concerns about the ability to pay back debts and the difficulty of selling longer-term debt.
Forecasting inflation is challenging, and the Federal Reserve and other forecasters have often missed the mark. The mechanics of inflation are similar to the stock market, and there are risks of higher inflation in certain scenarios.
Fiscal dominance refers to the constraint on monetary policy caused by fiscal policy. The ability to control inflation through fiscal policy may be more challenging now.
The Federal Reserve was slow to act on inflation and needs to consider a wider range of scenarios and incentives in its decision-making process.
The biggest economic story in our lifetimes is long-term growth and the importance of embracing new technologies and innovation. Incentives play a crucial role in solving economic problems and driving growth.
Social programs and the tax code need to be examined together to understand the full impact on incentives and redistribution.
The interconnectedness of policies and the need to consider the whole system when addressing economic challenges.

Links:

Twitter/X: https://x.com/JohnHCochrane

Website: https://www.johnhcochrane.com/

Substack: https://substack.com/@grumpyeconomist

Book: https://www.amazon.com/Fiscal-Theory-Price-Level/dp/0691242240

Timestamps:

00:00 Intro and welcome John Cochrane

01:30 Macro picture and understanding inflation

04:00 We’re a supply-limited economy, more money and stimulus thrown down ratholes won’t make the economy grow

05:30 The Fiscal Theory of the Price Level

11:35 Limitations of the Federal Reserve's interest rate policy

17:00 History lesson on 1970s, 1980s inflation

19:00 Fiscal picture today and possible solutions

25:00 The fragility of the US economy

31:00 More persistent inflation

37:55 Fiscal Dominance

41:00 Assessing the Fed's actions

48:00 Long-run growth is the only thing that matters

53:00 The Role of Incentives

#171 Dave Friedberg, CEO Of Ohala And Co-Host of The All-In Podcast, On The New Breakthrough Can Boost Crop Yields By 50-100% And Could Change Farming Forever May 21, 2024

Show notes

Investor and entrepreneur Dave Friedberg, the CEO of The Production Board and CEO of Ohalo and co-host/"Bestie" on The All-In Podcast, returns to The Julia La Roche for episode 171 to discuss his company's breakthrough technology that could solve world hunger.

Ohalo, a startup that's been in stealth mode, recently filed a patent for its groundbreaking technology, Boosted Breeding. This novel, non-transgenic plant breeding system has the potential to revolutionize agriculture by sustainably increasing crop productivity and yields by 50 to 100%. After years of research by Ohalo's scientists, the technology has been proven effective across various crops. The technology can be applied to a wide range of food crops, including those that currently lack commercial seed systems, such as potatoes. With its significant potential to enhance food availability and sustainability, Ohalo's Boosted Breeding is poised to make a substantial impact on the global agricultural landscape.

Links:

Twitter/X: https://x.com/friedberg

Ohalo: https://ohalo.com/

The Production Board: https://www.tpb.co/

The All-In Pod: https://www.allinpodcast.co/

Episode 18 featuring Dave Friedberg: https://youtu.be/0ARf45HiS1M?si=yWFwnCPdJ1fv_Nxj

Timestamps:

0:00 Intro and welcome back Dave Friedberg

1:42 Big picture + challenges facing humans today

3:18 A new enlightenment or a new dark ages?

6:33 Independent thought and understanding through reason

9:15 Ohalo and Boosted Breeding breakthrough

13:20 Going all in as CEO of Ohalo

18:00 Results from Boosted Breeding

22:44 Benefits to farmers

27: 52 Potential impacts of the technology

34:30 State of the economy, No. 1 issue is debt

41:00 Optimism is technology and productivity gains

45:17 Parting thoughts

#170 Bob Elliott: The Biggest Risk For Equity Investors Is The Economy Remains Too Strong May 16, 2024

Show notes

Bob Elliott, cofounder and CEO of Unlimited, which uses machine learning to create index replication ETFs of 2&20 style alternative investments like hedge funds, venture capital, and private equity, joins Julia La Roche on episode 170.

In this episode, Elliott discusses the macro picture and highlights that the economy is in an income-driven expansion, where people are spending out of their income, leading to sustainable growth. However, this income dominance is creating challenges for the Federal Reserve, as inflation remains elevated and nominal growth is strong. Elliott believes that the Fed will continue to collect more information before making any significant policy changes.

He points out that assets are in an “air pocket” right now, and that the biggest risk for equity investors is the economy remains too strong, creating pressure on the bond market. He suggests that investors should consider holding more cash, allocate a portion to gold and commodities, and be cautious about stocks and bonds.

Links:

Twitter: https://twitter.com/BobEUnlimited

YouTube: https://www.youtube.com/@BobEUnlimited

Website: https://www.unlimitedfunds.com/

Timestamps:

00:00 Introduction and welcome Bob Elliott

01:15 Macro picture today + income-driven economic expansion

03:34 Different angles of looking at inflation

06:11 Fed's policy outlook

09:15 Implications of higher for longer

11:50 Long-end of the bond market is the critical driver of asset prices

14:47 The biggest risk for equity investors is the economy remains too strong that creates pressure on the bond market

16:00 Allocating in this setup

18:30 We’re in an 'air pocket’ right now

23:19 The Fed

25:50 Gold allocation and commodities

30:10 Parting thoughts

32:46 Confusion of the income-driven expansion

36:00 Recession

#169 Carol Roth: The Stagflationary Economy Is Making A Resurgence May 14, 2024

Show notes

Carol Roth, a “recovering” investment banker, financial television commentator, entrepreneur, and two-time New York Times best-selling author, joins Julia La Roche again for episode 169 to discuss the state of the economy, the Federal Reserve, the impact of deficit spending, and the challenges faced by small businesses.

Links:

You Will Own Nothing: https://www.carolroth.com/nothing/

Follow Carol Roth on Twitter: https://twitter.com/caroljsroth

Timestamps:

0:00 Intro and welcome Carol Roth

1:15 Macro picture, assessment of the economy

2:30 Massive inflation in assets

3:20 Economy has been “window dressed”

5:40 Deficit-driven economy

8:30 Fiscal dominance

10:45 Stagflation

15:00 The Fed

17:00 Debt

20:00 Gold

24:00 State of small business today

#168 The ‘Acid Capitalist’ Hugh Hendry On The Fed’s No-Win Situation, The Fragility Of Valuations, Gold As ‘The Alchemy Of Chaos,’ Buying Bitcoin, And The Dangerous Sign The Japanese Yen Is Sending May 09, 2024

Show notes

The Acid Capitalist Hugh Hendry joins Julia La Roche again, this time in the East Village, for an in-person, unfiltered conversation on macro and more.

Links:

Twitter/X: https://twitter.com/hendry_hugh

Podcast: https://podcasts.apple.com/us/podcast/the-acid-capitalist-podcast/id1511187978

YouTube: https://www.youtube.com/@HughHendryOfficial

Timestamps:

0:00 Intro and welcome

1:36 Macro view and the Fed’s no-win situation

2:45 Revisiting financial history

4:20 The U.S. has become the economic locomotive of global growth

5:00 Policy error of fiscal conservatism

6:30 Everything is expensive

7:52 Invest 10% of net worth

9:00 Hugh’s hedge fund years

12:24 ‘To manage a lot of money you have to be serious.’ — the suits

19:07 Looking at charts and patterns while listening to Pink Floyd

24:30 China

36:19 The bubble today - the fragility of valuations

38:00 How you want to be allocated

44:16 The conceit and the arrogance of a well-formed argument

47:00 Hugh’s mistake buying Reader’s Digest in the 90s

48:48 Hugh’s go-to interview question: Tell me when you know it’s going wrong

50:44 Gold’s breakout — not an agent of chaos, the alchemy of chaos

52:24 Japanese Yen

53:49 Bitcoin

57:09 Silver

1:01:50 The Fed’s no-win situation

1:06:49 The Fed shouldn't be cutting interest rates

1:08:47 Present danger

1:11:00 The death of money?

1:15:00 Millennials and Bitcoin

1:18:43 The Bono story

#167 Michael Pento: If Rates Don't Come Down Across The Yield Curve Relatively Quickly, The Economy's In For Big Trouble May 07, 2024

Show notes

Michael Pento, president and founder of Pento Portfolio Strategies (PPS), joins Julia La Roche on episode 167 to discuss the current state of the economy and the potential risks ahead.

In this episode, Pento highlights the rising inflation rate, the burden on the middle class, and the unsustainable levels of debt. Pento predicts a slowdown in GDP growth and the possibility of a negative quarter in the second half of the year. He believes that the Federal Reserve will be forced to lower interest rates and engage in quantitative easing to stimulate the economy.

Pento also discusses the potential impact on the housing market, equities, and the bond market. He suggests overweighting energy, base metals, and gold in a stagflationary environment.

Links:

https://pentoport.com/

https://twitter.com/michaelpento

00:00 Intro and welcome Michael Reno

00:54 Macro view, inflation, and the bankrupting of the middle class

4:08 If rates don’t come down the economy is in trouble

5:49 Fed rate cuts ahead this year?

8:00 Market is massively overvalued

9:36 Stagflation and how to invest in that environment

11:32 Home prices

13:50 Why Powell can’t wait to end QT now

15:23 Long-term yields might not come down

16:00 Explosion of rates in high-yield will crush the economy

17:27 Gold

20:00 Erosion of the middle class

#166 Nancy Davis: 'Whatever They Say, The Opposite Happens' — Fed Meeting Reaction, Why Inflation Is Here To Stay, And The Opportunity For Investors May 02, 2024

Show notes

Nancy Davis, founder and portfolio manager of Quadratic Capital Management, joins The Julia La Roche for episode 166 to react to the May Fed Meeting and the Federal Reserve's decision to keep rates unchanged.

In this episode, Nancy shares that inflation is a persistent issue that cannot be easily resolved. However, she sees this as an opportunity for investors, as many people do not have inflation-protected bonds or exposure to the rates market in their core bond portfolios. Nancy notes that during the last period of high inflation in the 1970s, people often turned to commodities and cyclical equities because the interest rate derivative markets, rates market, and even the inflation-protected bond market did not exist at that time. She adds that investors now have more options to protect their portfolios against inflation compared to the past.

Links:

IVOL: https://ivoletf.com/

Quadratic Capital: https://quadraticllc.com/

Twitter: https://twitter.com/nancy__davis

0:00 Intro and welcome Nancy Davis

0:59 FOMC reaction

1:22 Fed allowing mortgages to run off

2:30 Volatility, explained

3:15 Fed interest rate policy

5:19 Be really careful about not focusing too much on consensus and looking more at what's priced in.

5:59 Rate cuts this year/ inflation exposure in investor portfolios

7:36 Opportunity in rates

10:49 IVOL (Quadratic Interest Rate Volatility and Inflation Hedge ETF)

15:48 Rates market a leading indicator for you

18:04 Macro picture

19:47 Inflation protected bond market

22:45 Inverted yield curve

24:13 Bonds a good buy?

25:18 Will the Fed cut this year? Will they cut before the election?

26: 22 Assessment of the Federal Reserve/ stagflation?

29:03 Nancy's background

32:40 Parting thoughts

#165 Jim Bianco On Stickier Inflation, A 10-20% Chance Of A Rate Hike, And Why The 10-Year Treasury Yield Could Surge To 5-5.5% Apr 30, 2024

Show notes

Jim Bianco, president of Bianco Research, returns to The Julia La Roche for episode 165 to discuss the current macro picture and the potential impact of inflation on the economy.

In this episode, he highlights the bifurcated nature of the economy, with inflation posing a challenge for lower-income individuals. Bianco also shares his insights on the Federal Reserve's interest rate policy and the outlook for long-term interest rates. He thinks rates for the 10-year are likely headed higher to 5-5.5% and breaks down what that could mean for asset allocation.

Elsewhere, he weights in on his concerns surrounding the narrative of the Bitcoin ETF, while emphasizing the need for a comprehensive alternative financial system.

Links:

BiancoResearch.com

BiancoAdvisors.com

twitter.com/biancoresearch

Timestamps:

0:00 Welcome Jim Bianco and intro

0:59 Macro picture

1:49 Stickier inflation

4:27 Bifurcated economy

6:06 Interest rate policy outlook

7:50 Fed is not partisan but it is political

9:29 Rates on the 10-year likely headed to 5-5.5%

12:00 The Fed doesn’t change policy in the summer up to election day

13:19 Implications for 10-year at 5-5.5%

19:59 Demographics

24:01 Bitcoin ETF

31:38 How Bitcoin gets to $1 million

34:10 Parting thoughts

#164 Chris Whalen On Higher Interest Rates, Illiquidity, And The Death Of Leverage Apr 25, 2024

Show notes

Investment banker and author Chris Whalen, chairman of Whalen Global Advisors, who is also the author of The Institutional Risk Analyst, returns to The Julia La Roche Show to discuss the big picture of the economy and markets.

He highlights the dichotomy between the consumer side, which is doing relatively well, and the commercial side, which is suffering due to low interest rates and illiquidity. Whalen predicts that interest rates will rise, leading to a preference for income-focused investments and a shift away from speculative pricing.

He also emphasizes the need for reimagining and redeveloping cities to address the challenges in the commercial real estate sector. Overall, Whalen believes that the economy is producing nominal growth but that people are struggling due to rising costs.

Links:

Twitter/X: https://twitter.com/rcwhalen

Website: https://www.rcwhalen.com/

The Institutional Risk Analyst: https://www.theinstitutionalriskanalyst.com/

The Death of Leverage; What’s the WAC of Bank America? https://www.theinstitutionalriskanalyst.com/post/the-death-of-leverage-what-s-the-wac-of-bank-america

Timestamps:

0:00 Intro and welcome Chris Whalen

0:55 Macro view, we’re in a weird dichotomy

2:55 Higher interest rates

4:03 Rate outlook

7:13 5 handle on 10-year treasury

10:18 The death of leverage

12:00 Confidence

16:43 Silent crisis in commercial real estate

20:25 A qualitative recession

25:15 Election year

27:23 Higher rates and impact on investor behavior