YouSaid · the spoken record

Constance Hunter

lines on the record: 92
first: 2018-02-02
most recent: 2018-02-02
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Everything knowing just the amount of knowledge you have and how that becomes cumulative, it's so valuable. And knowing the history, just having at your fingertips, having experienced, having experienced crisis. So what I experienced, the Russia crisis, and as we were approaching the dot-com crisis, and Fed was raising rates, I said, you know what? I think I've seen this movie before. I think I know how this is probably going to end, right? And so every experience becomes cumulative and it helps you if you let it.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“And practice the basics over and over and over again. So I still go and make my own graphs sometimes. Well, not by hand. No, in Haver Analytics, but I still go in and immerse myself in the data, do my own E-Views calculations just because it keeps your fingers in the dirt, so to speak. And then I would say get in before the boss and leave after the boss. Wow.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“You need to read, you need to learn, you need to really enjoy finding out about the world. It helps if you are doing something you are infinitely curious about. If you're not curious about it, you're not going to be engaged. You're not going to love it. And you can't only do what you love. Every job has parts that are annoying or tedious. So you need to do those too. You need to do what I call play the scales, right? So it doesn't matter. So play the scales.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“And so, this intelligence that these animals possess, and just the way she tells the story. And so I just think, again, to go back to your point of being well-rounded and the different ways that people think creatively and the different life experiences and things you can learn is just endless.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a great book. And one of the things that she talked about in the book was how the elephants would know that the planes were coming and that it meant that they were going to be shot. And they would literally, she talks about how the largest female elephant would often hide with her head in a tree. So you couldn't see if it was a male or female. You couldn't see the tusks. While the howl rest of the herd, including the bull, would go off away from where the plane was And then when they were far enough away, the female elephant would bring her head out and they would be circling above kind of waiting and waiting. And it turns out it was the female and not the bull. And then they would have... They want the ball with the test and now they had lost the herd”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Give us something you favored biography Oh, there are many great ones. So one of my favorite biographies that I read a long time ago is called Wes With the Night by Barrel Mark West with the Night. It's by Beryl Markham. And she was a female pilot in East Africa in the 30s, and she made money taking people on hunting trips.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Kyle Brenner, amazingly. Yeah, yeah, it's a great book. And then I love reading biographies and I love reading autobiographies.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, it's a great book about all of the sort of foremost economists that are the basis of economic theory, right? So Adam Smith, Keynes, I think that he has a chapter on Veblen.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“So we were delving into what was the cause of that Nordic banking crisis. So those were two really just big, big thinkers who had a very strong influence on the way I practice economics and the way I invest.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“And then I had really amazing professors at Columbia. So we had a class that was taught by two gentlemen who were at George Soros running money for George at the time. And so it was Armenio Fraga. And Robert Johnston is now with INET Institute for New Economic Thinking, and Armenia Fraga went on to be the head of Brazil's Central Bank. and then has started a fund called Gavia, I think. It's been around for a decade or more. So these were two people who really, it was a little confirmation bias on my part, but they really solidified this idea that you need to read widely on a lot of different subjects. You need to be a student of history. You need to be a student of people. You need to understand as many different financial crises as you possibly can. So this was right after the Nordic banking crisis.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, that's how I learned statistics. This was back when people would read the Wall Street Journal and look at all the stock metrics on the back of the back pages of the journal. So he taught me what a PE was and dividends”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Pretty harmless. But you could tell that it was a very different approach, a very, very different approach. And remember, they were just coming off the default and devaluation Oil was at about $20 a barrel. So we had to do something to get the economy going and to do things. And coming off of that crisis and what happened in his first decade in power really improved people's lives. So the loyalty that he has among Russians who remember that time period?”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“That was nice of him. Well, you know, pre Gorbachev, this was not the way of Soviet power transition or Russian power transition.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, back when I was there it was in the hopeful days of Glasnost Perestroika. Yeltsin was president. He was trying to reform now. Was there some corruption? Yes. Were there oligarchs, most definitely?”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“And Pats got it. So I think people don't know because it's been some time has passed that I used to invest in the former Soviet Union. I have traveled all over the former Soviet Union. I've been a mile underground in a real nickel mine.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“And so it had a massive impact. I guess. So, and to answer your question, it could have a very significant impact on global liquidity and global demand”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“I cannot say that. In any case, what we saw was a big year over year decline in imports in 2015. And this impacted all of the commodity producers, Australia, Russia, South Africa, Brazil, you name it. And we fell to only sixty-one percent of the PMI reporting countries experiencing growth.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, especially. And so if you look at China's imports and you use the OECD data, and this is important because they get the real number, not the nominal number, because obviously for commodities, there's a huge fluctuation in nominal price changes. And they compile the data using all of China's trading partners. So they don't rely on the Chinese data collection And this is important because we all know that there are some question marks around China's data collection.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I think they might. And so if you look back at 2014, we were at 3% almost on the 10 year. If you use the PMI index, 79% of the world was growing. And if you look at what happened in China, China's demand shifted downward. And so what I look at a whole host of”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“So I think China is going to see some bumps in the road that are going to surprise people over the next two to three years.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“It is not, let's not mistake it for a market economy. It has some features of a market economy, but it has many more features of a command economy.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“So China is a big economy. It's the same size as the US. Obviously, their population is much larger, so their per capita GDP is smaller. So they're big, but they're not rich, right? They're not first world economy. Obviously, the coasts are rich. You have multiple because it's so large. You have many different Chinas. Right. But if we just think about that for a second, their sheer size makes them an amazing market. And if we think about it in the context of what's happening with artificial intelligence and data and analytics, you have huge amounts of data there, which is an interesting situation given our modern focus on platform companies and the network effect. So you have that sort of on steroids in China and it's interesting to watch. However, like any economy, Develop, and China is still a command economy.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Or into a big growth period as well So I think you have to be willing to look for those things and understand inflection points. But that is not the way most people study economics necessarily. And I'm fortunate that I have this pattern recognition skill combined with a lifetime of investing. Time spent on the buy side, sure. That has honed that skill.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Right. So we started withdrawing more and withdrawing more and withdrawing more to the point where we had withdrawn $3.5 trillion. And you could just see that there's no way it could keep going. It made no sense. It made absolutely no sense. And then if you look at the demographics, that made no sense either because you could see that the working age population started to decline in 2000. So you could see it shifting demographic demand. If you were looking for it, Right, but you have to be open and searching for the things that are going to be inflection points. And then you have to have the conviction to shock your model.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“But also its pattern, some quarters were up, some were down. It was a random walk. It wasn't like it was $150 billion every quarter got withdrawn. It was up and down.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, not only was it giant, but if you look historically, it used to be a random walk around one hundred fifty billion a quarter. It would go up, we'd go down, basically a random walk. You couldn't. There was no way to predict it.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, six years, a decade, something like that. So the first thing is that what I had to do to shock this model because it just kind of bump and dump goes along on trend. And it would never forecast a recession unless you made it forecast a recession, right? So you have to look for tipping points. So there were three things that allowed me to call the financial crisis. And I didn't call it as big as it ended up being, right? Because that was just large. But I've done this my whole career, the same with Russia crisis, right? So the thing that allowed me to call the financial crisis was I was looking at mortgage equity withdrawal.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Sure, but that doesn't mean that we're going to see shortages of that labor over the next couple of years. It takes time for those people to get trained and for people to move into a professionally.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, there's some professions where we just, for example, let all this technology. You can't find data scientists at any price. There's a handful of them. There's an handful of programmers that are really top notch. And so everybody is competing in this space for the same talent. And it's a very new set of skills.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“That increase in inflation, increase in prices, will reduce demand, that reduction in demand will help spur us into the next recession. Plus, as wages go up, as there are shortages, we're going to get to a point, I would imagine, where you can't find someone at any price. And so you want to expand your business, but you just can't.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“That in the theoretical infinite losses or the actual infinite losses that can occur. People have, what's that famous Keynes expression, the market can remain irrational a lot longer than you can remain solvent? So, in answering your question, I think it is because of several things. First, models, I've been working on shocking my model to give it a recession because I think that we're going to see some labor shortages, that those labor shortages are going to cause wage increases, that those wage increases are going to push up inflation.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“I remember when I first started shorting. UBS, and oh, they have this activist investor in there. You don't know what you're doing, it's going to go up, blah, blah, blah, blah, blah. And, you know, you're constantly second guessing yourself more so on a short than a long, right? Because the nature of things is to go up for the most part. Over the long term, and everybody that works at a company, their entire goal is to make everything go up. They make new plan every year. They're incentivizing their employees. They're cutting costs. Like every single company is focused on that as well. And so that is the nature of things. So it's very nerve-wracking to be short. But nevertheless.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“We're actually studying this at KPMG, so we're taking the OECD work and we're expanding it and building a knowledge database of a multitude of different firms across different countries, across different sectors. And hopefully we'll have some research out on that in the next six to nine months.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes. And the question is, will we get to a point where this gap closes? Like, what is the cause of this lack of diffusion? And is there a tipping point where we can start to see wider diffusion?”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“So, but the diffusion is important. So, they looked at the productivity at the firm level, so not the economy-wide level, at the firm level of the frontier firm. So that's the top 5% versus everybody else. And if you look at these graphs, it's really alarming. The gap is really, really wide. And it's wider in services than it is in manufacturing. Makes sense.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“We need to do something in the intervening years, and the only savior then is productivity. Because so many people are focusing on this, one of the things that the OECD did was they did a study on the diffusion of technology throughout firms. So it may be, Barry, that you guys are really advanced and early adopters of technology.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“But that's still a long term prospect, right? You're still, it's 21 years until you see benefit from that, maybe 26 given the current education rates. So it's not an immediate solution.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Depends on the industry. So in finance, you're in an industry where there's been huge measured productivity gains. So what you're saying makes sense. It's what's shown in the data. And it is true for other financial services firms This is something that is puzzling everybody because we can't change the birth rate. So we're only going to get saved by increasing productivity.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“So I have a few things to say about that. One is that I'm going to introduce the concept of potential GDP So, in its simplest form, potential GDP is the sum of the growth rate of the working age population plus the growth rate of productivity. And historically, if we look back 50 years, we had average working age population growth of 1.6%, average productivity growth of 1.8. Quickly, that gets us to a 3.6% potential GDP. We now have a working age population growth rate of 0.3%. And until recently productivity during the recovery was averaging 0.8. So that's a 1.1% potential GDP. Now, productivity has picked up to 1.5. So that gets us up to about a 1.8% potential GDP, which is the growth rate that you can grow without inducing inflation in the economy. It's that mythical beast equilibrium.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, and so these disinflationary or deflationary pressures are also distorting the shape of the yield curve. So you have a completely new demographic phenomenon that aside from a brief period during the Great Depression when we had a declining working age population for a little blip of time, about seven years, we have never had before. And we've never, and while we have that, we did not have the longevity that we're having now. Right, so the combination of these two things is disinflationary.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Not the wall. Not the wall. And we actually flow has actually gone the other direction for several years. Right. But that's an aside.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Fast forward 15 years, and it's going to be look at Mexico. Their birth rates are declining. It's one of the reasons we have, there are two reasons we have fewer Mexican immigrants into the U.S. and why the flow has actually been the other direction.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Right. Now that may change, and they may need to do things and create incentives for that. But that it's not going to change overnight. And so And then we have South Korea, their working age population started to decline. So, this is a phenomenon in a lot of different places. It's starting to impact emerging markets as well. Oh, really? More in Asia, more in Asia, X India.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“A lot of it has to do with the one child eventually over time. Right. So they haven't been at replacement rate for decades now And even though that rule has been overturned, people are not rushing to have more than one child. It's not like the minute that was overturned in the next year you saw a whole bunch of two and three child families. Not a baby boom.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so it's very challenging. And let's not forget Chyna's working age populations started to decline this year, right?”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“So imagine you're a corporation and you're over-indebted and you can't default, but over time you can refinance your debt with negative rates.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes. And I'm glad we introduced the concept of real versus nominal before. Because if you look at their nominal growth rate, it is about 200 basis points above their 10-year yield. And that is allowing them to obtain greater and greater fiscal health. So they're using this negative rate policy and this extreme balance sheet example, again, balance sheet expansion, again, 91% of their GDP, all right? They're using this to refinance their government debt effectively.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Nobody else is even close, but I'll tell you something that they're doing. So if you look at the debt held by the public versus the debt held by the central bank because they have been purchasing so much of the debt, The debt held by the public has gone down to 120% of debt to GDP.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, absolutely, but it's problematic, but it's definitely better than if it was outright declining like you have in Japan. And Japan is now declining at a rate of 0.3% per year. And that puts Japan in a very, very special case. And their debt-to-GDP ratio is 198%.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“But even with that said, 2010 is the year that Europe's working age population started to decline. Oh, really? And our working age population is merely growing at a slower rate.”
2018-02-02 · Masters in Business · Constance Hunter Discusses International Finance · IDENTIFIED FROM THE TRANSCRIPT · source