Asset Manager Huge Hendry on the Federal Reserve and Current Events

Asset Manager Huge Hendry on the Federal Reserve and Current Events

Jason Hartman talks about home improvements during this pandemic and home purchasing as a response to the growing desire for more space. He details the work from home space and its impact on real estate. Later in the show, Jason is joined by asset manager Hugh Hendry to discuss what’s happening now and what happened in 2008. Hendry shares his thoughts on the Fed and what it has done over the past six decades.

Jason Hartman 0:56
Welcome to Episode 1483 where today we have gotten A weekend of shows for you. Normally we’re just five days a week but this week we’re going seven days a week because there’s just too much stuff to cover. We’re going to have the famous and very interesting Lee controversial sometimes hedge fund manager Hugh Hendry on in two parts this weekend. So we’ll have him today and tomorrow, of course, we’ll have my ranting intro parts for you as well. Okay, so what’s going on in the world before we get to Part One of Hugh Hendry, the stay at home orders caused a huge jump in home improvement projects. I talked about this almost three months ago, john burns is actually out with a survey on it. So now there’s data to back up my prediction, which has come true. Imagine that another one of my predictions coming through they’re always coming true. What am I going to do about that except interest rates that one never comes through? So I I stopped doing it.

Jason Hartman 1:56
Jason, you absolutely suck at predicting interest rates. No good. Okay, fine. I won’t do it anymore. Not gonna do it back. I’m gonna do it. Here’s my interest rate production for you. Hey, we’ll eventually be a lot higher than they are today. Hmm, I think I could be right on that one. I just don’t know when. Okay, so the home has become the center of the universe talked about that for months now. The home is the center of the universe. If you’re in the business of Home Improvement materials, furniture, Home Furnishings of any type, whatever it is, that makes the home better home office equipment, home gym equipment, you have already seen your business do quite well. And it’s going to keep doing well. People are moving like crazy right now. The Great American move is underway the mass migration that I predicted that I was the first to predict By the way, there was nothing in the media about this mass migration trend that is now coming true. Except yours truly. Jason Hartman predicting that About Yeah, God needs more than three months ago to time goes so fast anymore. I can’t believe it. It’s like dog years. One year is seven years in the world of pandemic and civil unrest. Yeah, I was the first predict this out there at least that I know of I you know, let’s not consume a lot of news and I didn’t see anyone else talking about this one. I was going out on a limb here but now it’s all happening. Now. It’s all happening. So you know that home sales are through the roof. Mortgage applications and mortgage closings are insane. I mean, they’re just booming right now. Everybody’s moving because they want to get into a better home they realize that their little tiny crappy house in a big city, it just doesn’t work for them. They don’t want to be in a city they want to be where they can be safe. They want to be where they can socially distance they don’t want to have these idiot over entitled. hypocrite liberally educated white kids doing riots in their streets. All of those loser protesters. They didn’t build that okay, yet they’re destroying it. That was a comrade. Oh, bye. This famous line you didn’t know that. Well, what do you think of these idiots in Seattle? Do you think they built any of that? No, that was built by blue collar workers that do the hard jobs. So these folks can go to universities and get silly degrees that have no value in the marketplace, taught by professors that work a whopping 12 hours a week, and spew out these absurdly ridiculous Marxist ideas from their ivory tower, and their 12 hour a week, 10 year job or they can’t get fired. And they have no, the marketplace has no recourse against these idiots. I mean, it’s just unbelievable what this country has come to in some some ways. It’s ridiculous, ridiculous. So anyway, those stupid hypocrites that do all the rioting and the destruction of businesses and now are doing their extortion rings, their mafia style extortion rings, to these poor business owners in these places and shopkeepers, saying basically, we’re going to destroy your Your business if you don’t pay us if you don’t give us free stuff, you think any of these businesses are going to come back to these areas not a chance, Not a chance. Hardly any of them will. They will vote with their feet, like every person does. And people are voting with their feet in mass. We have The Grapes of Wrath 2020 it’s like john Steinbeck all over again. But this time, the mass migration is to suburbia, and our investors can find those properties in suburbia, the booming rise of suburbia at Jason Hartman calm slash properties. That’s the kind of stuff we’ve been recommending for 16 years now. So burns, his group surveyed 5000 recent homebuyers just last week 69% of them cited COVID-19 as the reason they purchased a new home compared with only 31% who said they were planning to purchase for the pandemic, the reasons the COVID-19 related reasons lowest mortgage rates ever. By the way, did you hear that lowest mortgage rates ever? Don’t believe it. George gammon who will be speaking at our upcoming virtual meet the Masters event, which by the way, I am getting so excited about that event, you can do so much more with a virtual event that you cannot do with a physical event, you can get the best contributors from all around the planet. And this is going to be a really good event. So we’re going to have the registration page up for you soon. It’s just under a month away, and it’s going to be super exciting. Our first meet the Masters virtual conference, and it’s our 22nd anniversary. Meet the Masters 22nd anniversary event will be virtual for the first time ever and it’s gonna be awesome. You’re gonna love it. So get ready for that ticket sales will begin soon, and I’ll announce that next week. Okay, so lowest mortgage rates ever I profiled the book debt the first 5000 years on the show where he goes into a history of 5000 year history of mortgage rates. And guess what? We have the lowest mortgage rates ever. Two on that one ever, for a while, that’s pretty good. Other reason they move they disliked their current home layout. And the third reason was they desired a larger home. So they were living in a city they were living in, God forbid downtown Seattle, New York, Chicago, LA, San Diego, Miami, whatever, doesn’t matter. downtown Boston, Washington, DC, it’s all all the same deal. They lived in a 500 to 1100 square foot, little condo, essentially a prison cell. If you’re stuck there all the time in a lockdown, and they were paying three to $4,000 per month, maybe even more maybe 40 $500 per month up to 4500 Once a month for that unit, and now they realize, gee, I can work at home my employer doesn’t mind me working from home I’ve been pretty productive. I’m just cramped up in this little tiny prison cell. And why not move to one of the suburban markets listed at Jason Hartman comm slash properties shameless self promoter? Yes. Well and rented from one of Jason Hartman investors and I can rent one of those houses for 1500 dollars per month. And my square footage will triple A or go up by 33% of a 1500 square foot house and I get it for half to one third the cost and I got a yard and I can have a home gym and I can have a really nice home office and a two car garage and all will be well with the world. And maybe I get much better weather in the in the bargain too. You know, pretty good. Do no wonder there’s a mass migration going on. Okay, so investors, the tidal wave is forming offshore. Do any of you serve for body surf or boogie board I grew up doing that never got good at surfing but certainly spent many years on a boogie board. Okay? When you go out too far beyond where the waves are breaking, you know, you’re out there and there’s just some swells. And you’re like looking at that swell and thinking that’s gonna be a great wave, I gotta catch it. So you paddle paddle, paddle Swim, swim, swim. If you’re on a boogie board or body surfing, you’ve got fins, so you can go really fast with fins, they amplify your swimming ability dramatically, pretty much like leverage does on a real estate deal. And following my 10 commandments, all 21 of them, well wait 22 of them now.

Jason Hartman 9:49
Because commandment number 22 thou shalt invest in low density areas. So you’re out you see that swell, and that’s swell as it starts to get closer to the shore. turns into a bigger swell and then a wave and then the wave crest, and you’re riding that beautiful wave, that beautiful wave. It’s so fun to ride it. And then you go down the face of the wave, and ultimately, the wave breaks. So if we liken that metaphor to investing and timing, this pandemic, and now, riot, hey, investing, it’s a riot man. Oh my gosh, I’m so annoyed by this whole thing that’s going on, but it’ll pass. It’ll pass. You time it right now. We’re way off shore Still, we can see. Definitely the swell. Definitely the moves are happening. Things are picking up but it’s going to be much more significant than it is now. We ain’t seen nothing yet. So you get on early before it gets crowded. Listen, surfers especially know what I’m talking about. They have people like you know, one of our clients, Jeff. Hey, Jeff, are you out there Jeff from we’re gonna be By my old friend, he’s a he’s a client of ours. He’s done very well for himself with his real estate portfolio. By the way, Jeff, you know, you should come on the show, haven’t talked to you in a while, hope all as well, anyway. So Jeff will tell you or any other surfers will tell you, you don’t want someone to steal your wave, because the wave can only fit so many surfers on it, or you’re going to crash into each other have an accident, you’re going to be bleeding. You know, when the board hits you in the head, that’s not going to be pretty. You want to get that wave before it’s crowded so that you displace the other people trying to get that wave, meaning you want to get those properties before someone steals your wave. There’s a tsunami forming out in the ocean right now a tidal wave of opportunity to get these good suburban properties before someone else does. And by the way, grab our webinar. Okay. Jason Hartman comm slash webinar. Right now we’re featuring Southwest Florida. And it’s a really nice short webinar. It’s only 32 minutes long. So go check that out and you’ll like it. A lot of you have already I think we already had like, about 80 of you, check out that webinar. So Jason hartman.com slash webinar, singular, not webinars, webinar, singular. Go check that out right now after this podcast and learn about Southwest Florida. And of course, we’ll have changing markets there as we do new webinars and so forth. But you get that wave before those other surfers do and you ride it. By the time you know, most investors are in the position where they are. They’re trying to catch the wave after it already broke. It’s just whitewashed by them. And the opportunity has all dispersed and they’re coming in real late in the game and yeah, you know, it’s okay. There’s, you know, you can still make a little bit of money then. But the people that really do well, are the ones that are working hard, they’re paddling or they’re they’re feeding themselves. fins are flipping way out in the ocean as they see that swell forming, so that they can displace the other surfers and get that beautiful curl of that wave to themselves. It’s not just them, but then a few other surfers that got in early. That’s what you want to do. All right, what else? Wow. Well, I got some other stuff. But we better get to Part One of Henry and tomorrow I’ll be back with more. Usually we’re five days a week, but this week, we’re one of those seven days a week. There’s just a lot of content to get out to you. So if you need us, we are here to be your guide, your trusty guide along your investing journey and your wealth creation journey. We are here for you at Jason hartman.com or if you’re in the US one 800 Hartman and here is part one of hedge fund manager and real estate developer Hugh Hendry. Hey, it’s my pleasure to welcome Hugh Hendry from St. Barts from his resort. Maybe modestly, it’s not a resort in total, but he’ll tell you more. And he was a founding partner and it various times through the years Chief Investment Officer, CEO and Chief Portfolio Manager of eclectic asset management, and that ran for 15 years. And it attracted a lot of attention back in 2008, obviously, during the Great Recession, when he achieved a 31.2% positive return in the depths of really bad times in the Great Recession, and he has a reputation as a contrarian investor. Lately, he’s just been a macro viewer of the economy and the markets, and he’s known for his outspoken Twitter bombs and wisdom of many, many years in the macro community. You welcome How you doing? You know, I never

Hugh Hendry 14:51
felt better. And as you see, I I closed down the eclectic hedge fund at the end of 20 17 and I think I retreated into a dark, gloomy cave. I know everyone’s just at various stages of coming out of confinement. But I think I went into confinement at the end of 2017. But this year, and I ventured forward and I’m daring to offer my view on the world. And it feels like the old me, I’m misbehaving. And to be curious, you have to misbehave first, I think was one of the wisdoms that I learned earlier in my career.

Jason Hartman 15:32
Sure. Well, hey, any conformist and person who doesn’t misbehave a little bit doesn’t get any attention, right?

Hugh Hendry 15:38
Well, I don’t know if it was the naivety of youth. I mean, I certainly recall back in the day, so that would be back in 2002. And my seed investor for the macro hedge fund the offshore fund, was Would you believe it was the same patron as George Soros and his fund back in George launched in 1950. denied. And this wonderful sponsor, he was saying, I only have, I think was it three problems my three I could I could name 33 off the back. But one of his issues was was youth, you know that I was at the time I want to say, I think it was study 33 and he was lamenting that he could remember the day that when george soros began, he was 14 or something but the wisdom of investing in a man who had survived the vicissitudes of life, and therefore you felt perhaps more comfortable deploying capital with a man as opposed to a boy, but you know, I have known who knows who I am.

Jason Hartman 16:42
Well, hey, Jim Rogers Soros former partner has been on the show four times now. I just had him on again last week, so but he doesn’t want to talk about Soros at all.

Hugh Hendry 16:54
Geez, a lot of accounting. I think in my last podcast, I was recounting nibbling spent in at a private party overlooking Red Square. And I had Jimmy Rogers I had Nassim Taleb I had marked the legendary kind of structures Mark Farber and profound deep think about it character and I was exposed to all three of these these geniuses of the of the financial world. And I would say Mr. Systemic, he’s always great value, but even in downtime, I clearly the mystique that surrounds him being the founding partner with George back in the day, junk everyone wants a piece of piece of Jeremy and he gave us it and like he has like, he would go into his lapel and come out with a cigarette sugar sachet say I want you to buy sugar. This was back in 2005 2006. When commodities were really ripping another pocket you’d have a silver coin another would be a gold coin and other would be whatever it was Jamie always on.

Jason Hartman 17:59
That sounds like him. Yeah, he’s a great guy. But you know, we’ve had Mark Farber on the show but Nassim to lab. Oh, wow. I mean, just so interesting. I, I have not interviewed him yet. So it’s on the bucket list. Definitely. But hey, you know, tell us what you think about where we’re going. There’s a lot of uncertainty out there. And you people are rightfully, I think, very concerned. Take it wherever you want. There’s so much going on in the world right now.

Hugh Hendry 18:27
But this one stuff, people get concerned by the new, they get concerned by the law, big numbers. And since the crisis of 2008, we have seen new practices developed by central banks around the world, and which kind of come under poorly classified, but they’re willing to go into the theme of quantitative easing or the printing of money, as though the printing of money absolves us. financial decision. And since that emerged really very strongly in March 2009, I want to say there has been a very strong bull market in fear. And by that and what I’m what I’m very specifically actually using the phraseology of another fantastic commentator in the macro space, Christopher call who’s a great expert on options, and the mechanics and the construction of options, strategies. And up until the virus. You and I, and the faux pas watching this, and we’ve been kind of had a sense that everything’s not quite right. And having seen how quickly things could change in 2007 2008. We’ve been very keen to, if you will protect ourselves and in the financial markets, people have been doing so bad Buying put options and in the process volatility, which is one of these kind of nebulous kind of ethical concepts, but it’s one of the founding stores, which kind of allows you to create a a stock market, a bull market or a bear market. That kind of the living breathing and exhaling is really volatility and volatility has been too high, which is to say that people have been willing to pay too, too much to protect themselves against bad events. The reality is the events of 2008 are kind of they occur maybe once every 100 years, you know, if left unchecked, and if the financial authorities had not pursued the course of action. If they did, we could have gone back into the analog of the Great Depression. And of course we did, but there’s the fear that the Great Depression is just on our doorstep. So there’s been a bull market in fear, fear, perhaps, not misplaced, but the ability to process from fear just has not existed because of the kind of the central banks and what they’ve done, rightly or wrongly. And in doing so, actually, they put out a DVD put me out of business. I was your supplier, you know, if you were scared about the war, like you say, I made 31% in 2008. If you look at that photo that I made 50% in the month of October, I made 21% on a Monday, taking the kids to school,

Jason Hartman 21:27
give us some context for that, because, you know, I don’t have the numbers off the top of my head, but you were up 31% in 2008, how much was the market down in 2008? I know it was down. I just don’t remember that calendar here. The calendar

Hugh Hendry 21:41
year. Big question that delta really shows how skilled you are or lucky. Well, I would disagree with that. So I mean, let’s try not to question the comedy you draw for the s&p, I want to say we would be maybe Hi there. present in terms of point to point from high to low, would have been much greater possibly is like 58%. In terms of determining skill, it is more a function of the course of how we got from point A to point B. And that was the, the truly most difficult aspect to manage in 2008. You’ve seen the movie, The Big Short, I know, most of the participants are that the characters are portrayed in that movie, but necessarily the American managers but I knew all the salespeople and the products because we were all kind of we respond with a small community that could see the future like happening in front of our very own eyes. And if you remember one of those that that wonderful job from California, she was sitting on the most genius portfolio he was sitting on nitroglycerin, which was going to blow to that And make so much money for his clients. And yet he had to get them. It’s a technical word. But essentially, he had to close the fund to redemptions because the clients wanted their money back. I had the same thing a month, the month before October, my biggest client, I was very concentrated in terms of clients. I had a client that would 50% of my capacity. And they wanted all of their money by Yeah, just on the bearish. So the hardest thing is trying to keep people invested.

Jason Hartman 23:33
In other words, they did well and they wanted to take some cards off the table. No, no,

Hugh Hendry 23:38
no, no, the event had yet to happen. And they were beginning to give up on it. Oh, God, my life is way too full of interesting anecdotes. I had a conversation in New York with these benefactors, the sponsors of my fund, and I was down 3% at that point, I’d been all over the place. I’ve been up 25 I’ve been down 10 I know I was recovering. My losses and I was near flat, but near flight was minus three. And I remember them saying, you’re down minus three. But you don’t get these markets. You don’t understand these markets. We are going to give all of our money to this guy. This guy, he’s don’t fare too, but he gets it. She’s like, What are you talking about? These are? These are amongst the most sophisticated investors in the world. Go figure. The world is a crazy place.

Jason Hartman 24:27
Yeah, it is. Well, at the end of the day, everybody’s human, you know, and it doesn’t matter who they are. They’re all just people, you know, at the end of the day,

Hugh Hendry 24:34
yeah. And the date of your path doesn’t change your genius. You know, if you’re born in 16 1969, or 1769, you’ve still got the same weaknesses.

Jason Hartman 24:46
Yeah, no question about it. Well, you everybody’s wondering, where are we going from here? I mean, this is like we were talking about, it’s a crisis time. I’ve been doing this presentation, I call pandemic investing. And I actually Got the domain name for that? pandemic? investing.com. I kind of couldn’t believe it. Yeah, that was kind of amazing. And I think things are gonna get pretty tough. It’s a lot of businesses are picking up a lot of efficiencies now that they didn’t have before. But at the same time, a whole nother set of businesses losing a lot of efficiencies, businesses that depend on physical space, hotel restaurant capacity airlines, where people can’t socially distance and they’re going to be forced into lower capacity. So that’s going to affect their operational ability dramatically. I think movie theaters Broadway plays, you know, whatever. So, what’s gonna happen? It’s hard to make sense of the world nowadays.

Hugh Hendry 25:41
You correct? Um, I typically I am curmudgeonly, you know, typically, I have a kid of the glasses is half empty or half filled. And, and it’s feeling half empty. today. The thing is with the virus three months ago, we had no data And therefore, it was legitimate to be very fearful, and to go the extra yards to try and protect our communities, and to try and manage the pressure that it seemed was likely to be felt by our medical infrastructure. Today, and I say this is I’m a fierce guy. I’ve spent the last 30 years analyzing stuff now. And we have so much data. And with the data, it is very hard to reasonably justified this willful destruction or enterprise across the world. It’s easy for me to say that, you know, kind of cozying up in my kind of billionaires Island and sand bars. The figures speak to another story. And so half of me feels like today is the is a narrative from an EIN Rand book. Has Atlas just shrugged Where is john? JOHN gold

Jason Hartman 27:04
behind gold is in his Valley.

Hugh Hendry 27:07
Yeah and if you will that I’m in my island I’m like, you know what have it ticket? And we’re like conspiratorial theories I think are off for the fairies but I can’t understand it’s this It feels like a coup d’etat by the state where we’re no all working we’re no all in the face in the hands of the government knew that very remember that was the most scary thing you could see were from the government. We’re here to help. Right? Yeah, go to hell Really? I think you got the wrong house. Like I think you wouldn’t be next

Jason Hartman 27:39
door. You know, right, the famous last words right and use that line a lot. You know, I’m here from the government. I’m here to help. But you know, and certainly, everybody around the world has become they’ve been forced to become a lot more dependent on government. And the next stage of this is going to be even more scary. I’m not talking about the economic impact. I’m talking about contact tracing, the surveillance society, the Orwellian 1984 of this. We ain’t seen nothing yet. We thought it was bad after 911 it’s just going to mushroom after this.

Hugh Hendry 28:17
I see. That’s correct. So, but I, you know, I think it’s, I think it’s very important that, you know, I was using that very powerful slogan from Reagan from 1980. It’s 40 years ago. Yeah. And I think we’re at the end of a 50 year cycle. So I think the origins of the 50 year cycle began with the US breaking away from Bretton Woods and from the gold standard up until I want to say August 1971, you know, a US citizen or, you know, anyone holding $1 bill could exchange it for its equivalent in gold ounces. And I was exposed as as ally by the overseas central banking community in order to be the French of that 50 year cycle. So by In the mid 1970s, the the the end of the previous survey, we I want to say we had a cycle, which run from 1932 19 to mid 1970s. So again, see the 40 or 50 years, but they kind of they then merges with the cycle which is just concluding No. And at the end of the cycles, chaos reigns and Brutus, we’ve had 40 years of order, not chaos. But if this was 1974 chaos would very much be the accepted belief system. What is chaos? chaos would be the OPEC cartel pushing the oil price from nothing to 12 bucks and have traffic round the block to get gasoline. Yeah, chaos would be the Vietnam War and it would be the vacuum would be the failure. Chaos would be the hippy revolution. Chaos would be breaking down your time. Your deliberation. You’re the crazy racist legislation. There’s so much chaos would be the central bank, the Federal Reserve having a kind of an income cap on how much you could air chaos would be the government telling you how many dollars you could take out of the country. Chaos was everywhere. And, and we were we elected Reagan and Thatcher. And we were praying for otter. And we got people like Paul Volcker, the chairman of the Federal Reserve and opposing spiritually and physically a giant of a man who think of a central bank that raises interest rates.

Jason Hartman 30:37
Yeah, recession. He forced he forced a recession, you know, I mean, of course, Volcker just passed away. But you know, his proponents would say that he was willing to make the country take the tough medicine and break the back of inflation. But others would say not so much. I mean, what do you think? What is your Volcker stance? I’m curious.

Hugh Hendry 31:00
These characters, they are a combination of making it happen and being in the right place at the right time. Okay. Paul Volcker today would not be the right time to why was Paul Volcker, the right man at the right time, when he became Fed Chairman, I was in 1977. He became Fed Chairman. He was potent and powerful, because we were at the end of the previous cycle. We deal every afternoon, the US banking system was bankrupt in 1932. And we parched the economy of its debt and we had a global war in between which slow that process down. But we typically kind of went from total debt of three times the American economy, and by 1973 74, that debt figure was one times we leveraged when you add leverage when debt is small versus income. You can have employ a sheriff like Paul Volcker and he can raise interest rates. He raised them by 200 basis points two percentage points on a Saturday morning you can do that you can purge the system of his rottenness. I was kind of saying the Fed that Anna Volcker fed the Fed. The mission then is to be kinda like Tony Soprano. You pimp the economy nothing pimps us because my kind of colorful language and today, uh, Paul Volcker would be at task trophy, or that strategy because there’s too much debt

Jason Hartman 32:32
is Jerome Powell doing the right thing today. The balance sheet is insane. I don’t think any of us I mean, we thought it was crazy during the Great Recession. But now, this is outlandish what the Fed is doing. And Powell is so bold about it. He makes no bones about it. Buzz Lightyear is his hero to infinity and beyond. Greenspan would be talking in code and you’d have to decipher him but Powell is just a

Hugh Hendry 33:00
No, I think I think you’re very unfair. I think pose Exactly. I take issue with almost everything you said about power. And

Jason Hartman 33:08
saying he’s a bad guy, or anything I’m just saying is what the issue

Hugh Hendry 33:11
with the policies that he is trying to explain to the American public. And of course, he’s explaining and trying to say that they are worthwhile, or they are very much. They’re like a medicine, which is necessary. And so the actions of the Federal Reserve, the fear is that they are printing money. And eventually, if you print enough dollars, then the price of finite things like property, like so, prime real estate, prime real estate, yeah, the things that are so like St. Barts is prime real estate, a this is a I don’t want to say 23 kilometer wide. The circumference, I think, is 23 kilometers, which is to say it’s tiny, that building code makes it harder and harder to construct on the island. And so the stock of new housing is not expanding. Okay, so that’s a finite supply, as the argument is, the more and more and more, there is no talk about trillions of dollars that you produced, then you’re going to push prices higher for these finite assets. That’s the argument in favor of gold. And that’s why gold is beginning to resuscitate and rejuvenate itself and prices look as if they’re set to go higher. And is the Fed. What is the Fed doing wrong? I would say the Fed is pretty much at the limits of what it can do. I think the Fed gets a bad rap. I think that it’s not printing money. The financial markets are watched like hawks by very, very smart and aggressive and bond traders. They’re pricing 10 year securities today at almost zero yield. The problem is the Fed is credibility that no one believes that they have the wherewithal To generate inflation. I don’t really take issue with what the the the crisis that the crisis we saw about a 35% Peak to trough very rapid decline in the price of risk assets in the month of March. And were it not for the intervention of the Fed? That probably could have been a 50 or 60% correction.

Jason Hartman 35:24
And I’m not necessarily being critical. I’m just saying that it’s amazing. I mean, the action has been overwhelming. It’s really

Hugh Hendry 35:36
what it hasn’t. So I’m not trying, trying to kind of, say the opposite each time to you, but you said push your hot buttons. So here we are.

Hugh Hendry 35:47
Did you I know sometimes I have a tendency to kind of be a little bit too full of myself, but the remarkable asset of what’s happening with the American central bank, you Jay was on Just trying to put it. It’s trying to say that I’m Fed chairman of a call me Gee, I’m like, I’m just a regular guy. He’s actually, he’s now embarked on a radical PR campaign. Okay. And he’s been advised to do so because of his credibility problem. The thing is, there’s when they, if you will printed money, which is a nebulous concept, yeah. But they can imprint it to the equivalent of almost annualize that they continue printing or intervening in the manner that they did in one week in March, you’d be talking about something like $60 trillion $1 creation. To put that in context, that would be like three times the size of the US economy. That’s enormous. And yet, the bond market went big deal, but what did you do? He didn’t do anything? There’s no if anything, he didn’t do enough. If anything, interest rates are gonna go negative. So 100 you’re sitting there going, Wow. I can’t believe I read in the newspaper. But the fans just lost his, his, his bearings, and we’re printing all this money. And you know, this must be the advent of higher prices, we’re going to get inflation. I’m going to be in my car and I’m gonna have to queue run the blog, and all it’s going to be 100 bucks. On the other hand, the smartest people smartest, I know this emotional intelligence but

Jason Hartman 37:21
bond, people

Hugh Hendry 37:23
who know more about pricing bonds than anyone in the world. They’re sitting there going mostly. So you’re it’s kind of hard to be Jayco today, everyone thinks you’re a moron. I had that problem. And don’t be a moron. Be an oxymoron. And that’s the day

Jason Hartman 37:40
that’s similar. This will be continued on the next episode. Thank you for listening and happy investing.

Jason Hartman 37:51
Thank you so much for listening. Please be sure to subscribe so that you don’t miss any episodes, be sure to check out the show’s specific website. General website Hartman Mediacom for appropriate disclaimers and Terms of Service. Remember that guest opinions are their own. And if you require specific legal or tax advice or advice and any other specialized area, please consult an appropriate professional. And we also very much appreciate you reviewing the show. Please go to iTunes or Stitcher Radio or whatever platform you’re using and write a review for the show we would very much appreciate that. And be sure to make it official and subscribe so you do not miss any episodes. We look forward to seeing you on the next episode.

Archive