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:

#113 Jim Rickards On What The Israel-Hamas War Could Mean For The Global Economy Oct 24, 2023

Show notes

Jim Rickards (@JamesGRickards) returns to the podcast to discuss what the Israel-Hamas war could mean for the global economy, the impact on oil prices, and the rise of antisemitism on American college campuses.

This episode was recorded on October 19.

Rickards is a New York Times bestselling author of Currency Wars: The Making of the Next Global Crisis and several other best-sellers, including The New Great Depression, Aftermath, The Road to Ruin, Death of Money, The New Case for Gold, and his newest book Sold Out: How Broken Supply Chains, Surging Inflation, and Political Instability Will Sink the Global Economy.

An investment advisor, lawyer, inventor, and economist, Rickards has held senior positions at Citibank, Long-Term Capital Management, and Caxton Associates. He is also the Editor of Strategic Intelligence, a widely-read financial newsletter.

Links:

http://www.jamesrickardsproject.com/

https://twitter.com/JamesGRickards

0:00 Welcome back to the show, Jim Rickards

1:20 The big picture, according to Rickards

2:16 Horror of October 7

8:27 Israel’s response in Gaza

10:30 Egypt, Jordan unwilling to take in Palestinians

12:16 Ground invasion and logistics

13:45 A much more brutal, drawn-out and violent result

15:20 What this could mean for investors

21:00 A financial war

26:00 Greatest threat to the dollar

28:00 Ineffectiveness of sanctions

34:00 Antisemitism on college campuses

#112 Darius Dale: Why We Could Have A Worse Recession Than Investors Anticipate Oct 19, 2023

Show notes

Darius Dale (@DariusDale42), founder & CEO of 42 Macro, an investment research firm that aims to disrupt the financial services industry by democratizing institutional-grade macro risk management frameworks and processes, joins Julia La Roche on episode 112.

In this episode, Darius presented his proprietary 42 Macro Weather Model to share his economic and market outlook. Growth in the real economy is expected to decelerate over the next 12 months, while inflation is reaccelerating.

Darius’ model predicts below-normal returns for the stock and bond markets over the next three months. It also suggests above-normal returns for the U.S. dollar and below-normal returns for commodities and Bitcoin. A key takeaway is that with so many negative indicators, cash is currently the preferred asset.

Darius also discussed the likelihood of a recession, citing that the most probable window for its onset is Q4 of 2023 to Q1 of 2024.

Prior to founding 42 Macro, Darius was a Managing Director and Partner at Hedgeye Risk Management, an independent investment research firm based in Stamford, CT. At Hedgeye, Darius was the Sector Head of the Macro team and was a core contributor to the firm’s economic outlook and associated investments. t strategy views. He joined the firm upon graduating from Yale.

Links:

42 Macro https://42macro.com/

Darius on X/Twitter https://twitter.com/DariusDale42

42 Macro on X/Twitter: https://twitter.com/42macro

42 Macro on YouTube: https://www.youtube.com/@42Macro

The Julia La Roche Show is produced by Marlinski Media.

Timestamps:

0:00 Welcome Darius Dale to the show

1:15 Macro view using the 42 Macro Weather Model

6:50 Recession outlook

8:45 Indicators of a broader breakdown in the business cycle

13:00 Inflation was going to bottom at a level inconsistent with 2% mandate

14:30 Rethinking expectations for inflation target

20:30 Fed outlook

26:44 Higher for longer and the duration of how long

28:49 Why we could have a worse recession than investors are anticipating

29:48 Fed won’t be able to do large-scale asset purchase programs that we’re used to

30:35 Fourth Turning empirical analysis

33:55 Powell

35:50 Where are we within The Fourth Turning?

38:00 Parting thoughts

#111 David Hay: The Odds Of A Recession Are Going Up, Not Down, With Each Passing Day Oct 17, 2023

Show notes

David Hay, co-CIO at Evergreen Gavekal and author of the Haymaker newsletter on Substack, joins Julia La Roche on episode 111.

In this episode, Hay makes a case that the odds of a recession are going up, not down, with each passing day.

The conversation dives into the bond market, exploring the shift to a secular bear market and the implications this holds for the broader financial ecosystem.

Elsewhere, Hay shares where he’s allocated and why he’s mildly bullish on energy. He also points out we have a supply problem, and we’re likely to experience an acute and lasting oil shortage.

Links:

Substack: https://haymaker.substack.com/

Bubble 3.0 Audiobook: https://awesound.com/a/bubble-30-historys-biggest-financial-bubble

Evergreen Gavekal: https://evergreengavekal.com/about-us/

David Hay: https://evergreengavekal.com/team/david-hay/

The Julia La Roche Show is produced by Marlinski Media: https://www.marlinskimedia.com/

Timestamps:

0:00 Welcome David Hay to the show

1:20 Macro view

2:50 Odds of a recession are going up with each passing day

4:17 Misleading data

6:30 Higher for longer’s impact on bankruptcies

7:40 GDI recession

10:45 Federal Fiscal Funding Fiasco

12:29 Structural bond bear market

15:27 Supply and demand in bond market

17:44 Hedge funds buying USTs with leverage / the basis trade

19:40 T-bills

21:26 A ‘transitory’ bond rally

25:30 The country is circling the drain

28:00 Bondholders are going to be the sacrificial lambs

29:20 Where do you want to be allocated

31:40 We’re going to have an oil supply problem

33:00 Parting thoughts

#110 Marc Chandler: The Dollar's Rally Is, If It's Not Over Yet, It's Nearly Over Oct 12, 2023

Show notes

Marc Chandler, chief market strategist at Bannockburn Global Forex and author of the blog Marc To Market, joins Julia La Roche on episode 110.

Chandler, who has three decades of experience in capital markets and foreign exchange, argues that the dollar trending higher since the end of the Great Financial Crisis is coming to an end.

"It seems to me in the stock market, you need a new opinion, like every week or every two weeks, but the currency markets just trend for a long time. And I think that the dollar's rally is, if it's not over yet, it's nearly over," Chandler said.

As of late, the dollar has been strong, but that's likely due to the Fed being more aggressive in raising rates and the U.S. economy looking better than the rest of the world. The Fed's tightening is likely coming to an end, and the economy weakening is likely to bring the dollar's rally to an end.

Links:

Marc to Market: http://www.marctomarket.com/

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

Bannockburn Global Forex: https://www.bannockburnglobal.com/

The Julia La Roche Show is produced by Marlinski Media. Learn more: https://www.marlinskimedia.com/

0:00 Intro and welcome Marc Chandler to the show

1:20 Macro view and forex market

3:30 Dollar likely peaked already

6:50 What's lifted the dollar is coming to an end

7:30 Headwinds for US economy

11:30 Dollar is overvalued

15:00 Currency misalignment creating opportunity for U.S. investors to diversify more to Europe/Japan

18:20 Recession

20:30 Government spending/ deficit

22:30 Wholesale/retail price for money

24:36 Why not let the business cycle play out?

29:27 Minksy moment?

30:30 Debt is a problem, but not yet

36:40 Biggest risk for Marc

40:36 Thoughts on crypto

#109 Danielle DiMartino Booth: 'It’s Clear That The U.S. Economy Is In A Recession If It Wasn't For Everything That Uncle Sam Is Either Spending Or Fudging' Oct 10, 2023

Show notes

Danielle DiMartino Booth, CEO and Chief Strategist for QI Research, a research and analytics firm, returns to The Julia La Roche Show for episode 109. In this episode, DiMartino Booth argues that the U.S. economy would already be in recession if it weren't for the government's spending.

A global thought leader in monetary policy, economics, and finance, DiMartino Booth founded QI Research in 2015. She is the author of FED UP: An Insider’s Take on Why the Federal Reserve is Bad for America(Portfolio, Feb 2017), a business speaker, and a commentator frequently featured on CNBC, Bloomberg, Fox News, Fox Business News, BNN Bloomberg, Yahoo Finance and other major media outlets.
Prior to QI Research, DiMartino Booth spent nine years at the Federal Reserve Bank of Dallas. She served as Advisor to President Richard W. Fisher throughout the financial crisis until his retirement in March 2015. Her work at the Fed focused on financial stability and the efficacy of unconventional monetary policy.

DiMartino Booth began her career in New York at Credit Suisse and Donaldson, Lufkin & Jenrette where she worked in the fixed-income, public equity, and private equity markets. DiMartino Booth earned her BBA as a College of Business Scholar at the University of Texas at San Antonio. She holds an MBA in Finance and International Business from the University of Texas at Austin and an MS in Journalism from Columbia University.

Links:

QI Research: https://quillintelligence.com/subscriptions/

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

Fed Up: https://www.amazon.com/Fed-Up-Insiders-Federal-Reserve/dp/0735211655

The Julia La Roche Show is produced by Marlinski Media: https://www.marlinskimedia.com/

Timestamps:

00:00 - Welcome Danielle DiMartino Booth to the show

1:06 - Macro outlook on the economy, discussion on job market and revisions

3:56 U.S. economy is clearly in a recession if it weren’t for government spending

6:30 - Discussion on the Federal Reserve and the higher for longer regime

9:20 An about-face for equity investors

11:46 - Conundrum for RIAs

15:22 - Biggest risk is in middle portion of commercial real estate and corporate debt

17:30 - Exchange Traded Funds (ETFs) and a passive investing bubble?

18:27 - Discussion on Federal Reserve's zero bound interest rate policy

22:30 - Geopolitical risks following an attack in Israel

24:30 - US deficit at wartime levels, fiscal responsibility and potential long-term consequences

26:30 - Conclusion

#108 Chris Whalen On The ‘Silent Crisis’ — The Looming Commercial-Led Recession Oct 05, 2023

Show notes

Banker and author Chris Whalen (@rcwhalen), chairman of Whalen Global Advisors, who is also the author of The Institutional Risk Analyst, joins Julia La Roche on episode 108.

In this episode, Whalen delves into what he terms a ‘Silent Crisis’ lurking within the commercial real estate sector and its ripple effects on regional banking and the broader economy. Whalen highlights the intricacies of the Federal Reserve’s policy shifts and how the central bank is slowly killing the world of credit and putting banks in a tough spot.

Links:

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

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

0:00 Welcome Chris Whalen to the show

1:14 Big picture is the Fed is slowly killing the world of credit

2:13 Bond market is signaling the Fed is going to stop soon

3:34 Commercial real estate risk

4:18 Banks are looking at another down quarter for net income

5:30 Commercial, not consumer

6:18 New York State Assembly killed multi-family housing

9:26 A typical recession was led by consumers, but this recession is being caused by the Fed

11:24 Landlords are a small business

13:00 Silent crisis

14:50 Impact on banks

16:00 Politics need to change if NYC is going to survive

17:30 A strange economic cycle

19:22 Half the banks in the country are insolvent on mark-to-market

20:24 Banks are a fixed income trade that masquerades as an equity trade

21:30 Fed will drop rates by end of the year because of banks

22:14 Should we have mark-to-market accounting?

23:50 Housing outlook, tips for homebuyers

27:00 Parting thoughts

#107 Claudia Sahm: The Economy Is At An Inflection Point Oct 03, 2023

Show notes

Former Fed economist Claudia Sahm, the founder of Sahm Consulting and creator of The Sahm Rule — a recession indicator — joins Julia La Roche on episode 107 for a wide-ranging discussion on macro and the Federal Reserve.

In this episode, Sahm noted that the economy is potentially at an inflection point, and we’ll know soon if we’re getting a soft landing or are headed in a slow grind that could lead us over the edge and into recession.

At the moment, she’s in the 50-50 baseline case when it comes to recession. To be sure, Sahm is concerned about the cooling in the labor market. She noted, "Once things get going in a bad direction, they keep going.”

Throughout her career, Sahm has worked at the Federal Reserve, the White House, ad has advised Congress. She’s the creator of the Sahm Rule, a reliable indicator of a recession based on the unemployment rate. The rule was developed as a trigger for automatically sending out relief like stimulus checks in a recession, taking the politics out of it.

Links:

Stay-At-Home-Macro: https://stayathomemacro.substack.com

X: https://twitter.com/Claudia_Sahm

LinkedIn: https://www.linkedin.com/in/claudiasahm/

0:00 Welcome Claudia Sahm

0:44 Potentially an inflection point

2:07 Labor market

3:40 What’s weighing on consumers?

6:30 Long and variable lags

10:03 Has the Fed done too much?

11:50 Risk of doing too much is aligned with the risk of doing too little

14:58 Fed’s inflation fight

19:02 Assessment of the consumer today

23:09 Great Recession

25:54 Sahm Rule

31:17 Are we in a recession according to the Sahm Rule?

32.22 Labor

36:00 Risk of a recession?

40:05 50/50 case of a recession

42:56 Housing

47:22 A decade Federal Reserve

53:00 Storytelling is the most important part of the forecasting

57:00 Groupthink at the Fed

1:01:12 Parting thoughts

#106 Harald Malmgren & Nicholas Glinsman: The U.S. Treasury Market Is The ‘Ultimate Wrecking Ball’ Sep 28, 2023

Show notes

Dr. Harald Malmgren and Nicholas Glinsman, co-founders and partners of Malmgren Glinsman Partners, join Julia La Roche on episode 106 for a deep discussion on macro, geopolitics, politics, and the implications for financial markets.

Links:

Malmgren-Glinsman Partners Daily Ahead of the Heard and Malmgren Institutional Research: https://d5d0c2-2.myshopify.com/

“China Will Be The Next Japan” paper: http://www.international-economy.com/TIE_W23_Malmgren.pdf

0:00 Welcome Harald and Nicholas to the show

1:00 Harald Malmgren’s macro view

2:20 Huge debt situation worldwide, and growing U.S. budget deficit

3:30 Strong dollar, lots of disruption

4:55 U.S. Treasury Market is the ‘ultimate wrecking ball’

8:00 Malmgren-Glinsman’s call on China

10:00 Problems for the Treasury Market

11:19 Looking 3-months, 6-months, and a year out

15:00 10-year Treasury likely going north of 5

20:25 Implications of higher rates

24:19 Negative economic outlook doesn’t mean rates will come down

26:43 Stagflation/ where to invest in a stagflationary environment

37:20 Is it realistic to get back to a 2% inflation target?

42:00 When are we going to trim this fiscal monster?

43:30 The big risk today - the fiscal imbalance

49:00 Biden

53:58 Leadership

56:00 Message for Millennials

1:01:30 Hal Malmgren on political teamwork across parties

1:04:22 Parting thoughts

#105 Sam Burns: The Economy Isn't Headed For Recession Any Time Soon Sep 26, 2023

Show notes

Sam Burns, chief strategist of Mill Street Research (www.millstreetresearch.com), an independent research firm, joins Julia La Roche on episode 105.

In this episode, Burns explains how he deploys a top-down macro research approach with bottoms-up analysis.

When it comes to the economy, Burns points out that the economic data has been better than expected and that inflation is headed in the right direction after the worst of it peaked last year. He doesn’t expect an imminent recession in the next six to 12 months. Instead, he expects a gradual slowdown in the economy rather than a sudden fall off a cliff.

As for markets, Burns is overweight equities compared to bonds. Burns, who had been bullish stocks earlier this year amid the pessimism, pointed out that things have gotten back to more normal expectations.
Burns has over 20 years of experience as a market strategist, providing analysis and commentary to institutional investors globally. Prior to founding Mill Street Research in 2016, Burns worked as a senior strategist at leading firms, including Oppenheimer & Co., Brown Brothers Harriman, State Street Global Markets, and Ned Davis Research. Mill Street Research provides a suite of consistently updated research reports for institutional investors covering asset allocation, country allocation, sector and industry selection, and a robust quantitative stock selection process.

Learn more at www.millstreetresearch.com.

0:00 Welcome Sam Burns to the show

0:57 Top-down, bottom-up approach to research

2:23 Macro view today

4:15 Better-than-expected economic data, inflation coming down

6:13 The balance between fiscal and monetary policy

8:14 A gradual slowdown in the economy

11:05 Worst of inflation peaked last year

14:19 Can inflation get to 2-2.5%?

16:06 Higher for longer

18:10 Not currently expecting a recession in the next 6-12 months

20:00 Consumer

22:25 Markets

25:08 Bond market

32:00 Stock market

36:40 Opportunities in the market

39:15 Traditional 60/40

41:30 Parting thoughts

#104 Christopher Zook On Stagflation, Energy, And A 'Generational Opportunity' In Commercial Real Estate Sep 21, 2023

Show notes

Christopher Zook, founder and Chief Investment Officer of CAZ Investments, which oversees just under $6 billion in assets under management, joins Julia La Roche on episode 104 for a wide-ranging macroeconomic discussion.

In this episode, Zook shares that he still sees stagflation ahead. In this environment, Zook is looking for opportunities in dislocated assets, particularly in energy and real estate.

Zook has over 30 years of experience investing in traditional and alternative asset classes. He was recently honored with the Texas Alternative Investments Association’s (TAIA) Lifetime Achievement Award in recognition of his contribution and sustained support of the industry in Texas. He regularly contributes to major media outlets, including CNBC, Fox Business, and Bloomberg. Before starting CAZ Investments in 2001, Zook served in senior leadership positions with Oppenheimer, Prudential Securities, Lehman Brothers, and Paine Webber.

0:00 Welcome Christopher Zook to the show

1:07 Macro view today

2:50 The Fed likely to maintain credibility

4:08 Inflation and stagflation

5:40 Stagflation impact on stocks and bonds

8:30 Entering into a lost decade

11:44 Passive investing v. Active investing

16:20 Dichotomy in the market

19:00 Fiscal picture in the US

22:19 Betting against subprime

22:53 Concern about the consumers’ spending habits

25:27 Investment opportunities