Juggling Dynamite

Aggressive risk-takers are widely declared ‘genius’ winners during speculative booms, while risk-managers concerned about downside risks and resiliency are discounted as pessimists and ‘underperformers’.  In the same vein, those who make money by selling ‘investments’ to others commonly espouse that ‘cash is trash’ since they are in the business of getting people to exchange their cash for goods and services.

In reality, no one knows exactly what’s coming next in life, but low financial leverage and high liquidity enable optionality and–as COVIV-19 has so quickly reminded–are the lifeblood of households, businesses and investment opportunity–the difference between resilience or demise in times of stress, like now.

To keep our heads and personal discipline when others are losing theirs requires preparation, patience and a plan to move against the herd in times of exuberance and depression.  This recent Hedgeye TV discussion with Dr. Malmgren is far-reaching and worth a mull as we think about the world.

Pippa Malmgren is a trend-spotting economist, entrepreneur, two-time bestselling author, former economic advisor to President George W. Bush and co-founder of H Robotics.  Here is a direct video link.

Positive news is scarce these days. In this clip ECRI’s Achuthan updates on what their economic models are seeing in the present recession and suggests that it might end faster than average, and be followed by an ‘arduous recovery’.  An ‘arduous’ recovery may not feel much better than the recession though.

Economic forecaster Lakshman Achuthan warns the coronavirus pandemic is hitting the U.S. economy harder than the financial crisis. “This is a brutal recession… extraordinarily deep. Already, you’ve got 22 million people filing for jobless claims compared to 8.7 million jobs lost during the Great Recession.

“This recession could end up being among the shortest on record,” he said. “Just a partial re-opening of the economy would lift activity off the extreme lows.” Here is a direct video link.

Danielle was a guest with Kerry Lutz on The Financial Survival Network, talking about recent developments in the world economy and markets.  You can listen to an audio clip of the segment here.
Listen to “What’s Next For the Global Economy? Danielle Park 4-22-20 #4743” on Spreaker.