Weighing The Risks Orion

As nations grapple with shifting power dynamics, territorial disputes, and evolving international relations, geopolitical risks loom over the global economy and financial markets. From the threat of trade wars disrupting international commerce to the intricacies of diplomatic tensions altering investment landscapes, each scenario poses unique challenges and opportunities. 
In this episode, Rusty talks with Lauren Goodwin, Economist and Portfolio Strategist at New York Life Investments, focused on cross-asset and international analysis. In her role, she and her team are responsible for research, macro and asset class views, asset allocation, and thought leadership. Throughout her career, Lauren has linked the macroeconomic environment to investment decisions, whether in banking, corporate strategy, policymaking, or asset management. Lauren has extensive quantitative and forecasting experience and prides herself on translating that experience into actionable insight.
Lauren talks with Rusty about the current geopolitical concerns, with a special emphasis on the Middle East and how they might impact the economy and markets. Lauren also provides insights on various scenarios, including the Israel-Hamas conflict, the war in Ukraine, US-China relations, and their potential impact on stock, bond, and commodity markets. The conversation highlights the importance of focusing on real policy changes and diversification in the face of geopolitical risks.

Key Takeaways

[01:34] - Lauren's professional background.

[03:56] - Lauren's thoughts on the geopolitical situation in the Middle East.

[05:34] - The impact of the Middle East conflict on the stock and commodity markets.

[07:57] - The war in Ukraine and its implications.

[10:00] - US-China relations and the risk of China invading Taiwan.

[12:55] - Lauren's advice to advisors about the upcoming presidential election.

[16:12] - What advisors should consider when it comes to geopolitical risks.

[19:04] - Lauren's response to Rusty's base case scenario.

[21:18] - Lauren's thoughts on Rusty's good case scenario.

[23:31] - Lauren's take on Rusty's bad-case scenario.

[24:55] - How portfolios are impacted by globalization.


Quotes
[04:27] - "Be patient as geopolitical events are developing. Short-term moves are likely. But it's the underlying trend that can be obscure at first and really tends to drive an optimal asset allocation." ~ Lauren Goodwin
[16:45] - "When it comes to setting forward our scenarios for 2024, a lot of what we're thinking about are plain old economic risks that impact the market day in and day out. These disruptors can be very tempting to think a lot about. But really, what it comes down to for investors is focusing on action, not distraction." ~ Lauren Goodwin
[26:26] - "When you think about the most complex global supply chains like technology, energy, and even global finance, no one country is going to be self-sufficient in these major opportunity sets. We'll always have to work together or rely on one another in some form or fashion." ~ Lauren Goodwin

Links 

Lauren Goodwin on LinkedIn

Lauren Goodwin on Twitter

New York Life Investments

Fool for Love by Lord Huron

Market Matters Podcast


Connect with Us

Meet Rusty Vanneman, Orion's Chief Investment Officer

Check Out All of Orion's Podcasts

Power Your Growth with Orion


Disclosure
Access to the services presented is provided solely as a service to financial advisors. Orion Risk Intelligence does not make recommendations or determine the suitability of any security or strategy. Past performance of a security or strategy does not guarantee future results. Orion Risk Intelligence research and tools are provided for informational purposes only. While the information is deemed reliable, Orion Risk Intelligence does not guarantee its accuracy, completeness, or suitability for any purpose, and makes no warranties with respect to the results to be obtained from its use.

3133-OAT-11/17/2023

People moving across international borders has long been a defining characteristic of human society, shaping cultures, economies, and societies in multifaceted ways. As economic growth is closely connected to immigration, highlighting the potential benefits of a dynamic workforce, discussions on immigration and its impact on the economy and financial markets provide valuable insights for investors and financial advisors.
In this episode, Rusty talks with Donald Rissmiller, Chief Economist at Strategas. Don has directed the firm's economic research efforts since 2006. He oversees Strategas' thematic research as well as high-frequency econometric forecasting. Don is frequently quoted in the financial press, and his research has been consistently recognized by Institutional Investor magazine in its annual All-America Research Survey.
Don joins Rusty to talk about the potential impact of immigration on the economy and financial markets. They explore the connection between immigration and economic growth, the current state of the labor market, and the implications for inflation and interest rates. In addition, Don shares his insights on potential scenarios and risks related to immigration.

Key Takeaways

[01:56] - Don's professional background.

[02:41] - How Don defines risk.

[06:22] - The connection between immigration and the economy.

[08:49] - Don's assessment of the current labor market situation.

[09:53] - Don's assessment of inflation, the federal reserve, and interest rates.

[12:39] - Expectations for economic growth and corporate earnings growth.

[15:00] - Other things advisors and investors should consider regarding the economy.

[19:04] - Unique considerations that make the current business cycle different.

[23:48] - Rusty's base case scenario and Don's opinion on it.

[26:00] - Rusty's good case scenario and Don's response to it.

[28:17] - Rusty's bad case scenario and what Don has to say about it.

[30:10] - Other risks investors should be thinking about.


Quotes
[07:19] - "If we think about population or workforce growth coming domestically or through immigration, that, in the long run, will help support potential GDP growth." ~ Donald Rissmiller
[07:34] - "Having a dynamic economy could create better productivity growth, exchange of ideas, greater innovation, and greater invention." ~ Donald Rissmiller
[09:22] - "The domestic labor market is very strong, even leaning towards overheating at the moment. Because it's creating wage pressures, which are showing up in average hourly earnings, the employment cost index, and other wage measures." ~ Donald Rissmiller

Links 

Donald Rissmiller on LinkedIn

Donald Rissmiller on Twitter

Strategas

The Planet Suite, Op.32: Jupiter

Jason Trennert

Nicholas Bohnsack


Connect with Us

Meet Rusty Vanneman, Orion's Chief Investment Officer

Check Out All of Orion's Podcasts

Power Your Growth with Orion


Disclosure
Access to the services presented is provided solely as a service to financial advisors. Orion Risk Intelligence does not make recommendations or determine the suitability of any security or strategy. Past performance of a security or strategy does not guarantee future results. Orion Risk Intelligence research and tools are provided for informational purposes only. While the information is deemed reliable, Orion Risk Intelligence does not guarantee its accuracy, completeness, or suitability for any purpose, and makes no warranties with respect to the results to be obtained from its use.

2858-OAT-10/17/2023

The real estate market assumes a pivotal role in the economic landscape, affecting not only the financial well-being of homeowners but also the stability and growth of the entire financial system. However, the industry has experienced significant shifts in recent years, revealing vulnerabilities that could have far-reaching effects on the broader economy.
In this episode, Rusty talks with Marc Pfeffer, Director at the Imperial Fund and Co-Founder of M2M Capital. Marc has more than 35 years of experience in the investment management industry. Before co-founding M2M Capital, Marc was the managing director of S64, focusing on private markets capital raising by connecting alternative managers with asset managers, insurance companies, pensions, endowments, foundations, and wealth managers.
Marc joins Rusty to discuss the potential scenarios and risks in the residential real estate market. With extensive experience in the real estate industry, Marc explores the current state of the housing market, its vulnerabilities, and its potential impact on the economy and financial markets. 

Key Takeaways

[02:51] - Marc's professional background.

[04:12] - Marc's endeavor beyond the workplace.

[05:05] - How Marc defines risk.

[06:58] - The current state of the housing market.

[08:58] - The vulnerability of the residential real estate market.

[11:21] - Marc's take on the bond market, mortgages, and inflation.

[16:17] - The most effective way to invest in real estate today.

[17:28] - Marc's view on the future of the overall economy.

[21:35] - How the government can address the housing crisis.

[24:11] - Rusty's base case scenario and Marc's response.

[26:37] - Marc's base case scenario for housing prices and market impacts.

[35:32] - Marc's thoughts on Rusty's bad-case scenario.

[39:28] - The other risks Marc sees in the current economy.


Quotes
[10:53] - "It's very difficult to say what a true housing market is because there's virtually no inventory." ~ Marc Pfeffer
[22:03] - "If you want to get inventory up and get people to move on to housing, you treat your mortgage as an asset, almost taking it and making it portable." ~ Marc Pfeffer
[31:03] - "Stocks can do well without housing, but the economy is very difficult to do well without housing." ~ Marc Pfeffer

Links 

Marc Pfeffer on LinkedIn

Imperial Fund

M2M Capital

My Way by Frank Sinatra

Goldman Sachs

S64 Capital

J.P. Morgan

Portfolio Risk Analytics | Orion Risk Intelligence


Connect with Us

Meet Rusty Vanneman, Orion's Chief Investment Officer

Check Out All of Orion's Podcasts

Power Your Growth with Orion


Disclosure
Access to the services presented is provided solely as a service to financial advisors. Orion Risk Intelligence does not make recommendations or determine the suitability of any security or strategy. Past performance of a security or strategy does not guarantee future results. Orion Risk Intelligence research and tools are provided for informational purposes only. While the information is deemed reliable, Orion Risk Intelligence does not guarantee its accuracy, completeness, or suitability for any purpose, and makes no warranties with respect to the results to be obtained from its use.

2676-OAT-9/25/2023

Energy, often dubbed as the lifeblood of industries, holds the power to shape economies. However, the surge in energy prices has the potential to cast a shadow over the stock and bond markets, sending ripples through the intricate web of financial systems.
In this episode, Rusty talks with Jake Hanley, Managing Director and Senior Portfolio Specialist at Teucrium. Jake has an intimate understanding of investment strategies made available through Teucrium's funds. He is partly responsible for certain fund-related daily operating procedures and acts as an alternate for specific dual control functions.
Rusty and Jake weigh potential scenarios and risks associated with rising energy prices. With over a decade's experience in financial services, Jake also shares Teucrium's current macroeconomic outlook, how to mitigate the negative effects of rising energy prices, and the other risks investors should know about.

Key Takeaways

[03:11] - Jake's background and his work at Teucrium.

[05:02] - Jake's definition of risk.

[06:52] - Teucrium's current macroeconomic outlook.

[08:30] - The potential impact of rising energy prices on the economy and markets.

[10:31] - Jake's outlook on other commodity markets, such as agriculture and precious metals.

[13:04] - How to mitigate the negative effects of rising energy prices.

[15:11] - How advisors allocate commodities in their portfolios.

[17:16] - Other potential risks to consider, such as the situation in Russia and Ukraine.

[19:13] - Base case scenario on rising energy prices.

[22:06] - Good case scenario on rising energy prices.

[24:44] - Bad case scenario on rising energy prices.

[27:19] - Other risks investors should be aware of.


Quotes
[08:13] - "The foundation for all capital markets is international trade currency and sovereign debt. And as you have quakes and tremors in those markets, it's going to reverberate throughout all asset classes. That's why the broad macro view right now is volatility." ~ Jake Hanley
[09:07] - "Energy is the lifeblood of the industry. So higher energy prices either mean lower profit margins for corporations producing goods and services or higher consumer prices." ~ Jake Hanley
[21:57] - "Energy prices moving up can act as a cap for future economic growth. Higher prices can cure high prices." ~ Jake Hanley

Links 

Jake Hanley on LinkedIn

Jake Hanley on Twitter

Northeast Kingdom by Will Evans

Teucrium

Teucrium ETFs on Twitter

Vermont Flood Disaster Relief (Teucrium's Matching Gift Program)

Ameriprise Financial

Merrill Lynch

Jackson Hole Economic Symposium


Connect with Us

Meet Rusty Vanneman, Orion's Chief Investment Officer

Check Out All of Orion's Podcasts

Power Your Growth with Orion


Disclosure
Access to the services presented is provided solely as a service to financial advisors. Orion Risk Intelligence does not make recommendations or determine the suitability of any security or strategy. Past performance of a security or strategy does not guarantee future results. Orion Risk Intelligence research and tools are provided for informational purposes only. While the information is deemed reliable, Orion Risk Intelligence does not guarantee its accuracy, completeness, or suitability for any purpose, and makes no warranties with respect to the results to be obtained from its use.

2356-OAT-8/25/2023

In the real estate market, both the commercial and residential sectors are currently navigating through challenging waters. Rising interest rates and falling property valuations plague the commercial realm, while residential real estate contends with affordability and a shortage of housing supply. Although these markets face formidable challenges, knowing the potential risks and scenarios can help financial advisors and investors make better decisions.
In this episode, Rusty talks to Xavier Goss, Portfolio Manager, and Hannah Greene, Fixed Income Investment Analyst at Capital Group. Xavier has 19 years of investment industry experience and has been with Capital Group for two years. Before joining Capital, Xavier was a portfolio manager in the structured credit group at BlackRock. Hannah is a fixed-income investment analyst with 10 years of investment industry experience.
Xavier and Hannah address concerns about commercial real estate, such as rising interest rates and falling property valuations, and highlight affordability and shortage of supply as key issues in residential real estate. They also discuss the potential risks and scenarios in commercial and residential real estate markets. Xavier and Hannah believe the housing boom isn't over and that the economy is poised for a soft landing rather than a recession. 

Key Takeaways

[02:59] - Hannah and Xavier's career backgrounds and how they got to Capital Group.

[04:14] - Xavier's definition of risk.

[06:56] - A broader macro outlook from Capital Group.

[12:22] - What commercial real estate is and its challenges today.

[18:50] - How commercial real estate problems affect the broader economy.

[21:00] - Potential opportunities and catalysts for unlocking value in commercial real estate.

[22:51] - What makes up the residential real estate landscape?

[23:45] - The challenges facing residential real estate today.

[26:13] - Xavier's outlook on residential real estate and its economic impact.

[29:31] - Base case scenario for mortgage rates, home prices, and commercial real estate.

[35:00] - Good case scenario for mortgage rates, home prices, and commercial real estate.

[37:59] - Bad case scenario for mortgage rates, home prices, and commercial real estate.

[44:14] - Other risks investors should be aware of.


Quotes
[09:27] - "If you can survive a run on the banks and banking crisis in March and come out the other side relatively unscathed, that's a good outcome." ~ Xavier Goss
[19:05] - "As long as the problems in real estate are concentrated mostly on office loans, there won't be a broad spillover into the economy." ~ Hannah Greene
[24:22] - "If you own a home with a 2% or even a 3% mortgage, it's hard to pull the trigger and sell it because you don't know what home you'll purchase because there isn't that much supply out there. And you can't replicate that mortgage rate, so your payments are up two to three times what you were paying before." ~ Xavier Goss

Links 

Xavier Goss on LinkedIn

Hannah Greene on LinkedIn

Capital Group

Shake It Off by Taylor Swift 

One Love by Bob Marley

Fannie Mae

Freddie Mac

Insights | Capital Group


Connect with Us

Meet Rusty Vanneman, Orion's Chief Investment Officer

Check Out All of Orion's Podcasts

Power Your Growth with Orion


Disclosure
Access to the services presented is provided solely as a service to financial advisors. Orion Risk Intelligence does not make recommendations or determine the suitability of any security or strategy. Past performance of a security or strategy does not guarantee future results. Orion Risk Intelligence research and tools are provided for informational purposes only. While the information is deemed reliable, Orion Risk Intelligence does not guarantee its accuracy, completeness, or suitability for any purpose, and makes no warranties with respect to the results to be obtained from its use.

2048-OAT-7/28/2023

AI has become a buzzword that dominates the headlines, sparks conversations, and captures the imagination of both industry experts and the general public. However, amidst the seemingly widespread mentions of AI, questions arise regarding the existence of a potential bubble burst in AI stocks. As the debate intensifies, weighing the possible risk and scenarios surrounding the AI hype becomes crucial. 
In this episode, Rusty talks with Dan Russo, Portfolio Manager at Potomac Fund Management. Dan has been in the securities industry for 23 years. His experience includes a wide range of institutional investors, working with them to perform fundamental, technical, and quantitative research to navigate the market and generate actionable trading and investment ideas. At Potomac Fund Management, Dan conducts technical and quantitative analysis, structuring portfolios of ETFs based on this analysis and providing ongoing written research for the firm's financial advisor client base.
Dan and Rusty weigh some potential scenarios and risks from the possibility of a bubble burst in artificial intelligence stocks and future scenarios for the stock market, technology stocks, and interest rates.

Key Takeaways

[02:31] - Dan's career background and how he got to Potomac Fund Management.

[03:38] - How Dan defines risk.

[06:38] - Is AI-related stock overvalued?

[10:07] - Are there signs of speculative behavior in AI investments and indications of a herd mentality? 

[13:16] - How sustainable is the AI industry's growth trajectory? 

[15:30] - Will artificial intelligence increase investment companies' efficiency and productivity?

[17:44] - How AI impacts the markets over time and how investment managers manage their portfolios moving forward.

[20:44] - Rusty's risk and scenario on AI's impact on U.S. stocks, technology stocks, and interest rates. 

[22:25] - Dan's perspective on Rusty's first base-case scenario.

[24:58] - Rusty's good case scenario for AI stocks.

[30:03] - What other risks should investors think about?


Quotes
[12:53] - "There's probably a bubble in media mentions of the phrase AI. But I can make a compelling case that this is not super crowded at this point. And I wonder if I would call it a bubble yet." ~ Dan Russo
[19:10] - "If you are a fundamental investment manager or stock picker, keep doing your job. Keep analyzing these companies from the bottom up and then just incorporate AI into that analysis process." ~ Dan Russo
[30:30] - "Investors should also think about regulatory risks. We have no idea how governments are going to react to the widespread adoption of artificial intelligence." ~ Dan Russo

Links 

Dan Russo on LinkedIn

Dan Russo on Twitter

Potomac Fund Management

Can't Stop by Red Hot Chili Peppers

Global X ETFs

Manish Khatta


Connect with our hosts
Rusty Vanneman

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Disclosure
Access to the services presented is provided solely as a service to financial advisors. Orion Risk Intelligence does not make recommendations or determine the suitability of any security or strategy. Past performance of a security or strategy does not guarantee future results. Orion Risk Intelligence research and tools are provided for informational purposes only. While the information is deemed reliable, Orion Risk Intelligence does not guarantee its accuracy, completeness, or suitability for any purpose, and makes no warranties with respect to the results to be obtained from its use.

1696-OAT-6/21/2023