YouSaid · the spoken record

Edward Chancellor

lines on the record: 79
first: 2022-11-04
most recent: 2022-11-04
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

“Until we superseded. And then I thought, wow, wasn't the subprime security? That was extraordinary. And then we had the pandemic. Everything bubble, and you know, we have lived through the most extraordinary period in the history of finance. I had no idea that that was going to be the case when I started my career.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“I didn't know anything then. Look, we've been living through the most extraordinary period. I used to think the dot-com bubble was amazing.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“And the markets are going to be not rising any future, then actually that sort of premium that you earn from finance is perhaps not going to be there. And I suppose if I was sort of recommending someone and said they want to go into investment finance, I would say, are you sure your talents can't be used more beneficially elsewhere? Because if you think you're just going to enter into this sector because you're going to be paid five to ten times more than anyone else than the average, then I wouldn't be sure that that's going to be the case going forward.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Sort of almost think again. I mean, I don't think academia is a place to go into now. Journalism is much less, my grandfather worked at Reuters. Shanghai Bureau chief in the 1930s. And in those days you could earn a decent living and have a decent career in jail. It's hard. We're in Bloomberg. The guys here have paid Reason Bill. Financial journalism pays, most other journalism doesn't pay. So I'd probably say if you're going to go into journalism, do financial journalism. And in finance, Again, in my view, I went into finance, as I say, almost cynically. It actually then became a calling for me because I actually turned out to be genuinely interested in finance and finance history. People are drawn into finance because people are paid better. And we've had the financial sector growing and the markets rising. Now, if we've reached a cusp,”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“My wife and I go to India quite a lot, and my favourite novelist is Arkane Narayan, Graham Green said was the best writer in the English language. I start that book. With an epigraph from Narayan's, the financial expert, on the sort of Indian thing, I've been reading these colonial thrillers set in 1920s Calcutta by an Indian Scottish writer called Mukherjee. I can't quite remember his first name. They're pretty good. Have you come across Vaclav Smil, the Active's mill is the Canadian scientist who writes about energy and civilization. and is written last year he wrote a book called The Great Transition and this year he's written a book about how the world really works and Smill's argument is to look at how mankind's move from one energy source to another.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, when I was writing Devil Tate the High Miss, I went to see Charles Kindleberger outside Cambridge, Massachusetts. Crispin Odie, who I mentioned. Commissioned me to do that work on the credit, which has been very useful for me. Another investment for marathon asset management, our friend there called Charles Carter. I edited a couple of books for them on something called Capital Cycle Theory of Investment, which has been sort of quite important to me. And then Jeremy Grantham at GMO has been my mentor, I'd say.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Go through the problems of adjusting from the low rates to normal rates whatever that takes? Or are we going to just shift into a sort of a different type of paradigm in which... The state allocates capital and controls. I'm not saying that we're going down that route. I'm just raising the question that High talks about people sort of stumbling, progressing without really no real intention, blind progression. And one senses that there's sort of been a blind progression and no one, I mean, it's absolutely clear to me that no one in any position of authority considered the actual ramifications of monetary policy. Of these low rates.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Friedrich Hayek, the Austrian economist, philosopher, and he wrote a book in the Second World War thinking that the advance of the state during the war, into the economy and into people's lives was not going to retreat, and it wasn't really right. There was a sort of retreat. But my argument, drawing on Hayek, is that if you take away the universal price, the price of interest that guides the capitalist system, then the system will fail, and the more system fails, the more the authorities have to come in to prop things up until you get a position where you no longer in a way have a capitalist society. And I suppose that's the juncture we are today. Are we going to sort of”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“As I mentioned in the book, that insolvency rates were sort of absurdly low. We talked about the Great Depression, the new headlines were, oh, the worst financial crisis since the Great Depression. It was called the Great Recession. And then actually, if you look at insolvencies, they were lower than the insolvencies after the dot-com bust. The insolvencies after the savings and loan crisis of the early nineteen nineties. So you didn't get your bankruptcies, instead you get the zombies and the zombies are sort of living dead, which is sort of death to a capitalist economy because they discourage entrepreneurs, they discourage investment. They discourage productivity growth.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“tourism and technology as well. So you had this Schumpeterian creative destruction. The government debt relative to GDP came down. The economy, within six or seven years, Iceland was growing, had recovered all its losses, and was growing faster than any other European country. So making the creditors take a haircut, forcing them to take a haircut, goes back to these ancient Mesopotamian practices of debt jubilees. That's what they originated the debt jubilee, the giving up, the writing off of debt, which also the Egyptians and the Israelites did. And that's seen as a sort of left-wing idea, but I don't think it necessarily has to be. If you've made loans that are bad loans, then it's right that the creditor should take a haircut.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“And then it blew, but Iceland was not part of the EU, so no one was really coming to their rescue. The Fed didn't offer credit lines, dollar swaps to the Icelandic Central Bank. And so poor Iceland was just left on its own. And what's interesting is they sort of followed that course that you described. And the big banks went bus, they were put into receivership, domestic depositors were protected. The mortgage borrowers who interest rates went up, but mortgage borrowers were protected by giving taxation relief on their interest payments, and the foreign debt was defaulted on, and currency declined, there were capital controls, but after a few years, capital controls were taken off, and this is what's most interesting, is that the Icelandic economy transformed away from finance towards”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“I think it's here. Well, the policymakers and central banks, they say there was no alternative. And if you criticize us, you were wishing another Great Depression. But in fact, actually, I cite right towards the end of the book the case of Iceland as a counterfactual. Because what happened in Iceland? Iceland went completely crazy. Their debt, foreign debt was 10 times GDP, their current deficit was 25% of GDP. They'd completely given up fishing. They'd all turn into bankers.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Got bigger so I could sort of quantum can each time you kick it. Gets bigger and bigger and bigger. See, we're now sort of sitting under a massive can”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“I'll tell you, I mean, the thrust to the book is that you've got yourself into a Paris position, too much debt, too much risk-taking, over-inflated valuations, too little real savings, too much financial engineering. Too little, you know, real investment. And once you're in that position It's very difficult to get out of it. Do you remember after the financial crisis there was commonly used this phrase, kicking the can. Really for last, you know, you could say for the last 25 years or so, we've been kicking the can and now we've reached the point where you have inflation, as we say, and it's more difficult for the central banks to come in and kick the can any further because they're in danger of losing credibility.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Around the world, you had, I think, $8 trillion of central bank QE or balance sheet expansion. And roughly dollar for dollar. Increase in government spending, what's it? And then obviously people were just staying at home with their stimmy checks. And they were going out and buying meme stocks, having looked up on Wall Street bets, which stocks to be targeting and borrowing at 2% from Robin Hood.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Main Street was high unemployment and so on and so forth. It's different when by 2020 with the lockdowns and not just the US, Britain”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so I think mentioned quantificing becoming a dangerous addiction. Initially that quantiting after financial crisis was a time where the sort of financial system was deleveraging. The money wasn't really making its way to Main Street.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“It was a trade that, as you know, the UK pension funds engaged in to the tune of hundreds of billions of Of pounds and to make things more interesting, they use leverage too. So there is a sort of really a story for our times. of pension funds induced to because of the low interest rates and because that affected their present value of their liability. It says your discount rate again, they're forced to go in and do sort of water badge type stupid things of leveraging up. These long dated bonds while at the same time owning stuff that would have had a higher return, but then getting into a mess.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“But actually trading on a negative yield last year of 2.5%, been trading down for a long time. This year, that bond has lost 85% of its value. At the trough before the Bank of England intervened to try and sort of stop the Gilts market completely blowing apart, it was yielding to redemption 1.1%. You blew 85% of capital to end up with an asset with an expected real return held to redemption of just over 1%.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I mean, you've got the credit of the government. But look at what happened in the Gilts market recently. Recently in the UK, quite recently.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Of yields going lower, and therefore you could get capital gains from bonds with negative yields. And if you wanted income, you had to buy equities.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“No, no. I mean, look, we've been living in Alice in Wonderland world, you know. I mean, I think it's just a Lewis Carroll world. I mentioned somewhere that long-dated Japanese bonds that negative yields, that some Japanese life insurance guy who I says that yields don't matter. And people were buying long dated bonds at negative yields in anticipation.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Destroyed the vitality of the banking system. But he said, you know, he says that you need positive carry for the financial system to carry on making loans. Now, negative rates make things a lot worse. I mean, what you saw when the Japanese went over to negative rates in 2016, articles in the newspaper about Japanese buying safes to store their money. And one of the large German banks also announced that it was going to be storing cash. And then you get these absurdities. So the note, I don't think it's an impetus to credit growth, but you have these absurdities like Danish homebuyers actually receiving payments on their mortgages. So you're having a transfer of wealth from savers to borrowers. And then you have...”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Central bank or policy maker without anyone without anyone voting for it these people who wanted us all to have accounts with the central bank with the central bank having an authority just takes much of our capital away seem to undermine property rights but leaving aside that where we see in places like Japan and Europe there was no turbocharging of the economies in fact as you know banks can't make money at negative rates and they are reluctant to lend. This is a point that Bill Gross Pimco's former sort of bond king was making very early on in the era of zero rates that you know he says it sort of created was like sort of leukemia in the financial system the negative rates.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“I cite the English 19th century finance writer Ward Badget where he says John Bull, the eponymous Englishman, John Bull can stand many things, but he cannot stand 2%. And when people, we talk about yield chasing or carry trading. When rates very low, with the negative rates, do you remember the argument negative rates was that they were going to turbocharge the economies? This was a phrase used by Ken Rogoff, the Harvard Economist, who wrote a book. The curse of cash in 2016, where he argued that you need to get rid of cash so that we could have properly negative rates. Well, the way I see negative rate is it's a tax on capital. Which is instituted by an unelected”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“So the zero rate leads to these buildups of financial instability and at the same time contributes to misallocation of capital.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Among other reasons. What I'm saying is that every society, because it's innate because all humans are constrained by their mortality, all actions take place, economic actions take place across time, that even if you didn't have a capitalist or market economy, something would need to ration or to direct your resources or direct your behavior across time. In a way, it's more explicit in a capitalist economy because you're paying a certain rate of interest on your loan or you have a certain required hurdle rate on your investment or you're applying a certain discount in the valuation of an asset. The time value of money is the sort of first thing one learns in finance.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Even if you have a Soviet planned economy, you need to allocate resources across time. And if you're not guided by the interest rate at which the Soviets weren't, you're going to have these misallocations of capital that eventually clog up the system.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“It's vitally important. First of all, I'd say time is important to all human beings. And what's called time preference People's tendency to prefer the present to the future, to what we call discount the future. Appears to be a universal phenomenon. Some people are another way of talking about it is impatience. Some people are more impatient than others. So everyone has their own internal interest or discount rate. In finance, all finance is about transacting across times, lending, investing, and so forth. It's absolutely essential there's no activity in finance that doesn't involve an interest rate. I mean, I cite a description of the failure of the Soviet economy.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Six times GDP against an average of three and a half times GDP. And what you can see if you chart them, and I show chart in the book, is I show the household wealth with the Fed funds rate, and each time the Fed funds rate goes down, the household wealth sort of pushes higher and higher and higher. So that's obviously a source of instability, because then when you raise rates, hey Preste, the markets come down in tandem where the bond stocks, everything bubble. His way to the everything bust.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“had been neglected and by modern economists who really just see interest as a lever to control inflation and ignore these other functions. And the thrust of the argument of the second half of the book is that when the central banks focused only on using the interest to prevent the price level from falling after the global financial crisis They neglected the impact the saving has on valuations, on the allocation of capital, on savings and pensions, on the amount of risk taking, and on capital flows and the direction of capital flows. And in each of these other areas, we see, and I chronicle in the book, problems building up. So if you take, for instance, valuation, we just discussed earlier how valuation of the US stock market was very high last year, but aggregate household wealth that the Fed actually gathers the data.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, so time, as Ben Franklin, says, is money, time is valuable, time is our most precious possession, and we must use time well. All our economic actions are taking place across time, and we need to sort of coordinate those actions. How much are we going to save? How much are we going to invest? What type of investments are we going to make? What valuations will we place upon the house that we're purchasing? Should we invest in this country? How much risk should we take? All these factors Have an interest rate embedded in them and the American economist Irving Fisher says that interest is an omnipresent phenomenon. And really what I'm trying to do with this book is to take this oldest of financial institutions, this omnipresent phenomenon that to my mind”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“And my reason for going back to that point is to try and underline how important the function of interest is. In fact, Yale historian William Goerzman says that the invention of interest is the most important invention in the history of finance because it allows people to transact across time. And my thought, you know, when I was doing this work, is we're at moment of zero interest and of negative interest in many countries and that the zero negative interest were the sort of second most important development in the history of finance and possibly the most to my mind worrying development”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“In the beginning of the 20th century, out in the Midwest or whatever, people were still lending livestock and demanding interest payments in the offspring of the livestock. That, I think, is the origin. And then, as I say, in ancient Mesopotamia, which had large cities and trading quite, in a way, quite capitalistic. And you can see that interest was used on loans contains a sort of risk factor that people were using borrowing and paying interest to finance shipping ventures, to finance local businesses and tradecrafts, and also for financing the purchase of housing. So you see that in this sort of proto, what you might call a proto-capitalistic society, interest is serving a number of different important functions.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, if you look at the words in the ancient languages, including Assyrian and Greek and Latin and Egyptian, all the words for interest are linked to calves and lambs and kid goats. There is this sense that interest must have existed in prehistoric societies. And the idea was I'll lend you my cow. But a year later, I want the cow and a calf back, and you can keep there's milk. You can keep the milk. Now, you can keep the extra cow. And actually, as I cite in the book, the Americans were still...”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“We didn't get out. I mean, the pandemic was just the last gasp when they went back to quantive easing and they really became the House of Lords, British House of Lords wrote a report on quantum easing last year, which they called a dangerous addiction. And I suppose Bernanke introduced this financial dope. And I went off to work for hedge funds or whatever he does nowadays.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Nipat's 2002 Friedman's 90th birthday party in the Fed Bernanke says facetiously to Friedman, apologizing for the Great Depression on behalf of the Federal Reserve and ensuring that it won't happen again. And then five years later, we get meltdown that Bernanki and the Fed had in particular Bernanke had no inkling of what was about to happen. And then we didn't get a Great Depression, but we then got into this era of extremely low interest rates. Of quantitative easing, and that was associated with a period of what they call secular stagnation or extremely low growth. And we never really got out of that.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“We all know that's nonsense. Yeah, I mean, I write about that in this new book. Money flows off to the emerging markets when dollar rates are low and then it comes back because these guys are they're not saving they're actually just buying long dollars Treasury, right? That buying them to manipulate that currency of China most of all. But then I suppose the difference between Bernanke and me is that Bernanke has a sort of abstract view of economics, whereas I try and look at what's going on in the real financial world.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, quite a long time ago. I think I... I got interested in the whole subject about a decade ago. When I did this work on the credit boom before the financial crisis, I belonged to the school that thought that when the Greenspan Fed took US Fed funds rate down to 1% after the dot-com bust, that ignited, in my mind, the real estate bubble.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“And actually, I presented this to GMA clients, and Jeremy got up afterwards and said, I think the bull market has longer to run. And the other day he was sort of tweaking my notes by saying, reminding me that I had been bearish and that he'd been a relatively bullish. But clearly, there was another seven years to go. It got pretty... What happened in twenty twenty was nothing like it was.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, and I think what we've been, you know, look, the last decade, we had, you know, people were talking about dot-com 2.0 back in sort of 2012, if you remember. And I actually, one of my last projects at GMA was to do a sort of, to look at what was going on from economic sentiment perspective, looking at various different measures, bull bear ratio, amount of margin loans in the system. I can't quite remember what they were. But anyhow, I put them all together and it looked that speculative sentiment was very inflated in 20.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“And they're also indeterminate as to how high they can go. So if you don't know how long the bubble is going to last and how high it's going to rise, then you might be able to identify a bubble. And I don't think that's, frankly, that hard. And I think that's useful if you're just a long-only investor. You can stay out of the bubble market.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“He has a financial library in Edinburgh called the Library of Mistakes. And the idea is that you can learn everything you need to know and finance for an investment career by actually working out the mistakes people have made. And there does seem to be, yes, a sort of similar pattern. Although I should add that it certainly doesn't help you on the short side, betting against specive bubbles. When I was at GMO, colleague and I ran a sort of quantitative analysis of speculative bubbles and we crunch, release my assistant did 10,000 years of data. Various commodity markets and real estate markets and stock markets around the world And what we found is that bubbles are indeterminate in length”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, Jim Grant has a comment that as he says we're always stepping on the same rake. And I have a friend of mine, a financial strateist lives in Edinburgh called Russell Napier.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, that's it. I mean, given what we're going to get round to later, now that it... 30 year mortgage rate has double. I think the Americans are going to be grateful that they didn't do that much building. In the last few years, because otherwise we would already have a replay of 2007-8.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“Speculative companies raising money, the overinvestment, and then if you remember after the dot-com bust, you had these miles and miles of so-called dark fiber because you had excess capacity. In fiber optic cable, which I saw commonly cited about 95% excess capacity, and that ran for several years, a bit like the sort of, if you think about it, the excess US home building during the real estate bubble, which took, you know.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“What I didn't cite and devilate the hindmost was some research from a guy, I think he was at Bell Labs at the time called Andrew Odzliko, who's now at the University of Minnesota. and he and a colleague worked out in ninety eight ninety nine that the projections for internet traffic growth, the likes of WorldCom, the big telecoms company, were saying that internet traffic growth was doubling every couple of months. And Odziko found out that actually the rate of growth was slower than that. It's still doubling, but I think once every six months or so And the result was that getting in the mania people get overfixated on growth. They have growth projections, over-optimistic growth projections. Then you get the overinvestment.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“The last couple of years. And the speculator, the trouble is that they look into the future and they imagine the future is actually much closer than it turns out to be. And so you could say that they're operating with a sort of hyperbolically discounting the future or just say they have too low a discount rate. So they're drawing everything forward. And even with the internet, which as we know established and changed everyone's life within a very short period of time, even then it didn't stop the Nasdaq coming down by more than 75%. A lot of these dot-com businesses flaming out.”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“So the speculator now called the book Devil Take the Hindmost. And that is really a reflection of what they call the greater fool theory. Of investment is I'll buy a Shibu Inu coin. or an NFT and sell it to you, Barry. Well, I buy it because I think Barry's a bigger sucker than I am, and that he'll take it off me from a bigger price. That's a sort of Ponzi scheme or pyramid. Chain letter dynamic to a speculative bubble. And the other aspect of the speculator You often get lured into envisioning how the world will be and gets drawn. New technologies, whether You know, radios or cars in the 1920s or internet stocks in the 1990s. Various types of, well, think of all those spacks and electric vehicles of”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source
“You've read Schwed's Where are all the customers' yachts? Do you remember there he says the difference between speculation and investment is that speculation is an attempt normally unsuccessful to turn a little amount of money into a lot, whereas an investment is an attempt normally successful to make sure a lot of money is... Doesn't become a little”
2022-11-04 · Masters in Business · Edward Chancellor on the Real Story of Interest · IDENTIFIED FROM THE TRANSCRIPT · source