On this week’s podcast, I wanted to share a recent interview I did on Opto Sessions with Ed Gotham over in London England. Our chat took place on Thursday afternoon November 5, 2020, just a couple of days after an unresolved election. My main points revolved around focusing on price trends and worrying less about election results, at least as far as portfolio decisions are concerned.
Ed came at me with a bunch of great questions. I appreciate how direct he was. I wish more interviews I did came at me with such relevant topics and ideas.
I really enjoyed this one. Thanks Ed for a fun chat!
Mark Dow has been a guest on this podcast more times than anyone else for a good reason. Selfishly I always enjoy chatting with him. His perspective is fascinating to me because he does such brilliant job of combining price behavior with sentiment analysis and the global macro intermarket backdrop.
Mark worked for the U.S. Treasury Department in charge of Emerging Markets in the early 90s before ultimately running money for a Global Macro Hedge Fund in New York City. So he has a lot of opinions on economics and politics, but he’s great at not letting those things get in the way of his price behavior and sentiment analysis. He’s figured out how to separate them but also use his expertise to his advantage. That’s not any task.
I loved this conversation because we talked about how institutional investors are positioned coming into the U.S. election, how currencies and interest rates around the world are being affected, and in turn how they are affecting other asset classes. I ask him about Bitcoin and Gold and which one will win that battle. Of course, the US Dollar and Emerging Markets were part of the discussion (we can’t help ourselves whenever we get together), but we talk about how EM is now being driven by Technology and no longer the Natural Resources of the past.
I’ve done over 115 Podcast episodes and I don’t remember being this excited to interview someone. I’ve read all the Jack Schwager books and some of them multiple times. I know traders who regularly read these chapters as part of the mental training.
Think about it, Jack has interviewed the greatest traders in history. All of them. It’s incredible. And you know what strategies he uses to trade his own personal money? Technical Analysis.
He’s interviewed all of the best traders for his Market Wizards books. And he says about half of them choose their market direction using Technical Analysis. But almost all of them have some sort of Technical component for risk management. This concept of Risk Management is the one common denominator between all of the most successful Traders.
Jack also pokes fun at the Efficient Market Hypothesis, which you know always brings a smile to my face. He discusses some of the success of these traders and how their consistent returns over such long periods of time completely dismiss what he refers to as the Deficient Market Hypothesis.
Today we have a special episode of the podcast. I think it’s important to take a step back from the markets and Technical Analysis sometimes, and talk about something that is universal to us all. For this episode I invited Morgan Housel to come and talk about the importance of writing. For those of you who have been following my work for a long time, you often hear me talk about the personal benefits of putting my ideas down on paper. Sure, people all over the world get insight into what our firm is thinking, they get steady idea flow from my blog, and in some lucky cases, people might even learn something. But the truth is, my writing is an incredibly selfish endeavor. It forces me to think through the important concepts. And as Morgan talks about in this episode, the inability to express my thoughts in written form probably means my idea is stupid to begin with. The easier it is to write about, the better it will usually be received by our audience.
Morgan Housel is definitely one of my favorite financial writers in the world today. I know a lot of smart people who would agree with that. Whether you’re a market participant or not, but especially if you are, I think writing consistently is one of the most valuable things you can do. Even if you don’t share it with the public, and just keep it to yourself, I encourage you to get into the habit of writing. Think about it, people were keeping a journal and writing their ideas down way before blogs existed. There’s a good reason for that.
On the flip side, when it comes to reading, Morgan also had a few thoughts he wanted to share with us. He is very much against the Trophy Reading and ripping through an ungodly number of books just for the sport of it. He’s gone down that rabbit hole before and learned that he’s better off reading just 1 book a month, taking his time, talking to smart people about it, and really digesting it. He made some really good points about this.
This was a really fun episode and one that I think is a great compliment to a lot of the other conversations we’ve been having with smart folks about the markets. Enjoy!
Jeff Macke is the guy I turn to whenever I have questions about the Consumer. Anything retail, restaurants, internet sales, he’s the one we want to listen to. Jeff and I have known each other for many years and are friends with a lot of the same people. On my Youtube Channel, you can find an old clip of him and I talking about Gold & Silver back in January 4, 2012.
In this episode we talk about the restaurant stocks, pharmacies, which areas he wants to avoid and which ones he wants to own. He says the pair trade of the decade could very well be: Long Shaquille O’neil (Papa Johns $PZZA) and Short Kanye West (The Gap $GPS). This was a really fun conversation. I picked up some good ideas and had a few laughs. I hope you enjoy!
I’m so excited to have Katie Stockton on the podcast. Katie is someone whose work I’ve followed my entire career. Even early on, she was there talking about oscillators and price behavior. She’s certainly on the list of Technicians who have influenced my work over the years. Back in the day she worked with Mike Hurley, another friend of the podcast and our featured guest in mid-March. After spending most of her career on the sell side, Katie has adapted to the changes in traditional wall street research and has now gone independent, recently founding Fairlead Strategies. This was a fun conversation that I really enjoyed. Prior to recording, I told her to just pretend we’re at a wine bar with our laptops. What would that sound like? This is that!