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http://www.cambriainvestments.com/wp-content/uploads/2016/12/Trinity_WP_121616_A.pdf Meb Faber has cool paper out

Thinking about this chart also raises an important observation That the US inflation rate is not manipulated anywhere near as much as conspiracy theorists think. If gold follows inflation long-term, then the 0.7% real return would be the 'understatement' factor of US inflation indices. The...

In think in general, UST bonds make a little more sense as an inflation/hyperinflation hedge (for non-USD investors). If we consider that gold has been 'running hot' over the past few decades and its only term return is more like 0.7% real (if that) If I were to reduce the returns of gold in...

Let me issue a correction here, I mentioned that gold as an EM hedge might not be all that great compared to UST 10y bonds because its quite volatile and USTs aren't as much. As a result, USTs provide hyperinflation/inflation protection without the day to day higher volatility of gold. I think...

But its also tough for a country to go back in a trade deal. Lets say the US and a small country do a deal, they both cut tariffs in an equal proportion. A fair trade deal. Then 5 years later the country comes back and say they want to get out of the deal. Effectively, increase tariffs in a...

Well, I will give you this, trade is different than real estate because in RE once the deal is done there is no going back. You own it forever, but with trade, if one of the sides feels like they got a bad deal, at some point in the future they might try to reverse it. Thats what Trump is doing...

China accumulated a HUGE reserve during their good years, thats because they kept their currency undervalued and run a big trade surplus. A currency to fall during bad years because of loose monetary policy is fair game, central banks cut rates during recessions and when they cant, they do QE...

But the China thing is interesting in terms of the negotiations, looking at the China FX chart, it looks like they are VERY risk averse. These guys dont want to have a thing to move up or down quickly. FX is treated pretty much like a Fixed regime with little daily changes. When stocks collapsed...

Probably because of what is going on right now with the USD at multi-year highs. They let it float, the market takes it to whatever it wants to take it. Not to say that the US wasnt attacked when QE was going on, they were. But at least the US takes on both sides of the coin, whatever happens...

I'm not an expert on Chinese macro, I guess they dont want the RMB to collapse quickly to avoid even greater problems in terms of trade blow back, social problems, financial stability etc. But they have been steadily depreciating it since 2013. GDP growth fell bellow 10% in 2011 and have since...

The problem is that the world has tried to convince China to stop manipulating their currency for years, they tried to convince them to bring down barriers for years. I could go on and on. Its in the world's interest that everybody brings down trade barriers but a lot of the time there are...

Of course, there are some civil cases where some women claim they were assaulted, yet no prosecutor EVER picked up in these to bring criminal charges against the guy. Probably because they knew these women were just targetting a rich guy to try to get a fat settlement, if there was really a...

Here are some interesting facts about Trump https://en.wikipedia.org/wiki/Legal_affairs_of_Donald_Trump "Of the 3,500 suits, Trump or one of his companies were plaintiffs in 1,900; defendants in 1,450; and bankruptcy, third party, or other in 150.[1] Trump was named in at least 169 suits in...

Added a 1% position to 2045 US STRIP bonds

I think structurally, it makes a lot of sense to add some duration to a portfolio here. Not only yields are higher (both nominal and real) but there is the 'oversold discount'. People panicked and threw bonds away like crazy, there should be an extra theoretical return for fading an extreme like...

I figure, at worse case scenario I will just hold these as a recession/risk aversion hedge. Bonds are quite oversold and now there is some yield there to pick-up

I just switched from my 14-15y US bonds to 27y US bonds. I'm essentially starting to scale in my 'trump dip' trade that will involve longing bonds, shorting stocks and buying volatility. Looks like Trump is ramping up his 'crazy' talk/bluffs and it looks prudent to me to start to scale in the...

The alarmists will look at this and faint, but talk is cheap, it costs nothing to run around bluffing like this. But it can provide some benefits

The CRAZIER you act/look/is perceived, the less you need to do. If you are a CREDIBLE lunatic, all you got to do is talk, you dont have to do a thing. Thats a very effective way to achieve your goals. But sometimes the other guy will test you, to see if you are for real. Thats when you got to...

The Trump alarmists dont seem to understand that talk is cheap, its a very cheap way to see if your opponents will fold and do what you want. Actions aren't as cheap, they matter more. I still think Trump will bluff in some actions (you got to earn some credibility) but it will be more...