The Julia La Roche Show Julia La Roche
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- Economia
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.
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#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
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 th -
#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
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
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
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
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
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