Thank you all for your questions. Jack and I filmed at 9AM ET this morning and went for about an hour going through as many of these as we could. If you got your questions in today I'm sorry that they won't make it in but we'll try and go through them here. Look out for it on Monday at 6PM ET.

Explain Ed's TIPs vs Treasuries analysis and what comparison means.  Thank you.

 I just caught up and watched Raoul's framework for 2021 and beyond. Do you guys feel versed enough in markets to develop ( or have you already developed) your own investment/ trading frameworks? Or do you feel caught in-between the ongoing "Deflation vs Reflation" debate?

What will need to happen for the Fed to raise interest rates before 2023?  

Could you two speak a little bit about your careers up until the point you joined RV? I believe neither of you have a traditional finance background, but are clearly up to speed. How did you make the transition, and what did you do to catch up so fast?

How has your viewpoint on crypto currencies evolved over time (and what is your future outlook of how that could change) with respect to the type of asset it is, and what risk rating you attribute to any allocation in your portfolio.  

Perhaps you would split this discussion into something like btc/eth/xrp vs defi (or as you see fit) and with regards to how you consider them as an asset type I mean do you consider the investment as an inflation or deflation hedge, speculative investment etc.

Do you allocate a relatively small or large part of your portfolios to cryptos, and what would be your key non-price indicators to either reduce or increase your positions in the short/medium term?

What do you think is the primary driver in the increasing institutional investment in crypto currencies.

Apologies if some of these views may have already been expressed in other videos i have missed!

Many thanks,

Ross

Bonds investing is very complicated and guests on the RVDB tend to throw terms around assuming the audience is familiar with how everything works. But I don't, so can you explain from basic principles the relationships between things like bond prices, bond yields, real bond yields, the fed interest rate, the bond's interest (coupon?) rate, inflation, the dollar, equities, and how/why changes in one invoke changes in others?

For example, from recent videos and thinking about other facts I know I've figured out that bond yields are basically the inverse of bond prices, because if the bond price is lower then you can expect to earn more from the bond before it matures. But if the price decrease is coupled with a lower dollar (inflation) then real yields stay the same. Which is the cause and which is the effect?

Hello. I joined Real Vision recently, and I'm trying to learn as much as I can to find a good strategy to construct my investment portfolio (I'm still all in cash). I'm currently a bit confused about the concept of risk management with the current craziness in the markets. It seems the rule of thumb is that you should not risk more than you can afford to lose. But let's say I risk 1% to buy bitcoin and leave 99% in cash. But now it seems that there is a increased risk of inflation (or devaluation of fiat currencies), so having 99% in cash doesn't feel "safe" either. I can understand investment risk in terms of not losing money, but I find it difficult to define it in terms of not losing value. Correctly evaluating the risk level requires a reference of safety, which used to be cash (so zero risk means stay all in cash). Is this still the case? Or should you now really buy assets to be considered safe (e.g. safe = 50% cash)? I understand that position sizing is important, but I find it difficult to define what a safe position size is. I hope that my question is somewhat clear. It would be great if you could give your take on this.

I would love for someone to speculate on the Chinese banks, the PRC/Jack Ma demonstration (bait and switch IMHO) and the timing of Ant Financial (Antminers and the like, also worth buying IMHO). Just the brilliant minds hypothesize =)

the various interviews/podcasts i have seen say QE not inflationary despite M2 going way up bc when a bank like chase buys and then sells the new treasury bond to the fed, the newly created money goes into the banks excess reserves at the Fed. thus the excess reserves are increasing. My Q--where does the money come from for the bank, like chase, to buy the new T bill?  if its from their excess reserves, then those reserves are just replaced. if its from their other non excess reserves, then as their excess reserves go up, their other non excess reserves go down. sooner or later they will have to draw down on those excess reserves to replace the non excess reserves they used to buy all the new T bills. i read 8 trillion being sold this year to roll over old bonds and fund new expenses. so once they are taken out of excess reserves to replace the other reserves, wont that be inflationary as that money will finally get used and out into the monetary system? 

I'm just learning about cycles and am wondering how reliable they are to use to make forecasts.  I've heard of some people making amazing forecasts in the future for them but it seems more of an art than a science.  Any recommendations for implementing them with trading at all?

Here is, I hope, a fun one... when I used to work on the sell-side, we occasionally bantered the question, 'If you were to win the lottery, to whom (which Portfolio Managers/Investors) would you give your winnings to manage, and why?' Alternatively, I would ask of you each: to which of the RV contributors would you give your winnings to manage, and why?

Thanks fellas.

I have looked to a few of the videos out there on Gold Miners - James Rasteh's interview as an example - but looking for more content as I continue my research.

Question: 

What are the top Gold Miners (small cap/mid cap) you feel have a long way to run over the next 18 to 24 months?  Also, what are the key metrics you'd look to when valuing these opportunities?

Taxation Strategies for Crypto: while moving in with Raoul in the island is one option of a tax strategy, this question is serious. 

Given RV many Crypto videos, many of us bought into BTC, ETH earlier than most and made substantial gains. While personally, I do not want to depart quite yet, the question of taxation becomes a huge issue. 

In Canada this amounts to: 

"In Canada, 50% of the value of any capital gains is taxable. In the example, you would have to include $13250 ($26500 x 50%) in your income, however the amount of tax you'll pay depends on how much you're earning from other sources." 

This may seem odd, but the sheer amount of capital gains we have comes from buying into BTC and ETH in 2012-2020. For examples: having worked in Japan for 2 years, there is a tax treaty between Canada and Japan whereby we pay 20% withholding tax. This is a significantly lower tax rate than income tax in Canada. Next example, if BTC ETH etc goes to valuation levels of 10X-100x this becomes worthy of a strategy and a thread! 

My question is on behalf of many RV members, long term BTC and ETH investors, that have or will have potentially very large capital gains when they finally sell?   

Jack & Max, you've been able to get direct exposure to some of the worlds greatest financial minds here at Real Vision. How has this changed your own personal investment strategies, and who has influenced you the most?

I once heard an interview with a seasoned investor that the "green" investors don't know the established truths and therefore don't bring baggage into their investment thesis.  As you refer to yourself as the "young bucks" I'm interested to hear times that "obvious" thesis you come up with are refuted by some standard ideology that was curated with experience.  When did your ideas come to fruition and make the seasoned folks rethink their ideas.  When did they not and you were reinforced on the truths that the older investors had already established.

Question: What is driving the increasing 10-year treasury yield in the US? Are yields rising because of an optimistic outlook on future growth, government deficits, or some other reason? 

Why I'm Asking: In the Jan 11th Daily Briefing you and @Edward Harrison talked about rising yields, and their impact on equities (e.g. DCF potentially causing headwinds for equities). What I don't understand is why are yields rising? Would love to hear your perspective on if the rise is a positive or negative for the overall health of the economy. 

Hi Gents,

New to Real Vision, only recently joined.

Would be interested to hear about thoughts on Coinbase IPO and how and if smaller investors will be able to get a look in.

Thanks

Bal 

Max,

Raoul mentioned this week that he will rotate out of BTC at the high (??) and move into EM's? Can he explain further as I thought his BTC was a forever trade to protect his assets?

Here is something which I am thinking about myself since I am trying to navigate market hubris vs risk.  It has been the primary question on my mind since before Nov 2020.  I pretty much know what Raoul and Julian think (at least on question 1), let's get some feedback from the younger guys:

Questions:

What journey do you see bond yields going to by the end of 2021?  Straight up, or will there be potential bumps along the way?  Or is the recent spike a fakeout in your view?

Do you think there is a ceiling for bonds before systemic problems start to arise, and if so where do you feel that ceiling is?  And what do you look at to guesstimate where that ceiling is?

The thought process behind the questions:

With the Blue wave now coming in, I think the potential gap between bond yield bull vs bear cases has expanded enough that the risk of hitting a market trigger that causes problems we aren't expecting is higher.  2018 proved that there IS a ceiling where markets will start to react to increased yields upon a mountain of public and private sector debt.  Figuring out where that ceiling is of great interest to me now.

Problem is, when you look at markets, everyone expects inflation to show up and for everything to simply price off of that, and I am not sold on that idea yet.  I think we have a combination of currency debasement thru fiscal spending and supply shocks dictating asset prices right now.  If right, this is temporary, and not permanent, so it is simply "kicking the can down the road" so to speak, thus making the deflationary problems that the debt and our demographics represent simply larger and more fragile.  

Much of what was already spent went into filling the hole created by shutdowns.  And the damage from that has not been factored into economic models yet (in my view because lockdowns are still occurring and we haven't seen what the world will look like on the other side of COVID yet).  The market knows that equities grow with public sector debt, so they buy.  No one is paying attention to the carnage this has caused SMB.

But, if you throw an extra $2,000 into the hands of average Americans who exist in this very peculiar economy that we currently have, I am not sure there is a blueprint for predicting what will happen.  To mention nothing of potential state budget bailouts, potentially backstopping SMB loans thru Fannie/Freddie style loan programs, and infrastructure spending which can very well change the game.  Or student loan forgiveness which will simply be a stimulus for college grads and educational institutions.  

Having a unified blue government makes things possible that simply were just not going to happen with McConnell in charge of the Senate agenda.