YouSaid · the spoken record

Larry McDonald

lines on the record: 73
first: 2024-03-29
most recent: 2024-03-29
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

“They can get a job, but in a totally different industry than they've been accustomed to. And so you've emasculated the middle class in the United States. That's what inflation does, right? And so that creates just this really difficult environment for a lot of people that make less than $100,000 a year, less than $70,000 a year. And so that's created this political, all this political push from both Biden and Trump to bring jobs back to the United States, which is inflationary.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Yes, I mean, like I said, we've taken the 5 million jobs out of the United States. We've decimated the rust belt. There are fathers in the Midwest that their father, their grandfather, their great-grandfather all worked at General Motors, and now they're working in restaurants, or they're going to the library at home, they're embarrassed, or they're on disability. I mean, opioid, just look at Jack, look at life at what the United States spends on health care. We literally like two standard deviations greater than any country on earth. And life expectancy in many parts, and we looked at this carefully in the book, life expectancy in the Rust Belt and many of these states that Trump won, life expectancy's gone down, Jack, down because people are dying in their 50s because they can't make enough money to support their family after inflation and taxes, or they lost their job.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Colossal amount of demand coming the next 10 years and aluminum is a big winner in any kind of rebuild in Europe if copper is too expensive that aluminum comes in on the grid and so that's where I see just tremendous opportunities”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Over the next 10 years, I think you get a very good shot at that, which just looked through the math on the amount of plants coming back online and say Japan, the amount of the situation in the United States in terms of, if you look at the different legislation in the U.S., Washington is waking up to this problem. We have a big uranium production problem. And so there's going to be a massive rebuild. And so, and then there's going to be, I mean, nuclear is the most green fuel in the world. And so then if you look at copper, huge bull market coming, nickel, huge bull market aluminum, aluminum's your kind of back, you're cheaper source for metals for, say, the grid, like I said, the grid alone is a two trillion dollar project. And then you have this rebuild in the Ukraine. And so you've got this just.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“But catastrophic mistake because you've raised the standard of living in India. You've raised the standard of living in Africa. You're creating massive carbon consumers and these people can't afford solar and wind yet. These different countries, they can move it in over slowly over time. So gas and oil are going to fill that void. Uranium nuclear power. We've been writing about that for years. The entire uranium sector jack. It's like $48 billion. I mean, that's like a bathroom rounding era inside of Nvidia. It's just a joke. And so uranium probably triples from here.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Natural gas. And then you're talking about. Oil. I mean, oil the last time right now, the NIC, if you think of like the last couple months, the Nikkei was at all time highs. The Italian stock has changed and the French stock exchange were pretty much near all-time highs. The last time those markets were at all time highs, I'm sorry, oil was like $140 barrel. And you've got, you know, there's a billion people in India that don't have air conditioning. If you do, you know, we've done a lot of work in the book when markets speak around diesel demand in India moped sales last year, fourth quarter. I mean, if you're a young person in India and you've raised your standard of living, the Davos crowd, these guys, this is a horrific, potentially catastrophic miscalculation. They've, like I said, they've taken 5 million jobs out of the United States. They wanted to globalize, right? These are globalists, okay? It's a good thing, right? They meant well, right?”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Well, oil itself, the underinvestment in oil and gas gas is probably the most exciting right now. It's under $2. And gas is, I mean, with the LNG revolution around getting LNG into Europe and just the whole demand from artificial intelligence, gas we go from $2 to $8 over the next five, six years.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Plays really have they're underowned. ESG and regulation has dramatically forced a massive underinvestment and massive under ownership of a lot of these asset classes.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“You know, Met Cole is more made for steel making, and so steel is very important. Copper is the most important for the grid. But just think of the rebuild of the Ukraine. So what's crazy is the rebuild of the Ukraine is going to basically coincide with this artificial intelligence boom, you know, this boom in crypto. Everybody loves to talk about crypto, but nobody's talking about the energy solution of the computing power needed when crypto gets up at a higher price. So yeah, so steel, you know, you've got different types of steel, different types of coal and different types of companies like Arch Coal is more of a company that focuses on coal that's used for electricity. And so, yeah, so coal stocks, they're still extremely cheap relative to free cash flow. And so all these.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Book at least three trillion of investments across all those areas. I mean, just look at artificial intelligence. I mean, we have a 50-year-old power grid in the United States in some spots, 30 years old others, and we're supposed to take artificial intelligence, which is just think about the computing power of these data centers. You're talking about 460, 490 terawatt hours in 2022. And if you believe in video, if you believe their management team that's very boastful, very aggressive projections, if you believe the Wall Street analyst about artificial intelligence, then you're going to talk about energy demand or energy consumption going from 490 terabatt hours to 2000. And on a power grid that's that old, and on solar and wind, no way. The only way to get through that is with gas and oil and gas and uranium and nuclear power.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Just look at Panama. Panama has one of the most first quantum companies. This is one of the most incredible copper mines in the world. You can get copper out of the ground to the ocean from the mine very fast. And whereas in other parts of the world, like in Africa, it takes a long time. The politics of Panama shut that mind out. And it's one of the most profitable, productive minds of the world. Seeing the same thing in Chile, same thing in Pruch, to some extent, not the same violence. But it's just you've got this suppression of investment through regulation, through really intimidation politically, bad politics. And so that's why you, that's why these commodity bull markets, Jack, can run for like five to three to eight years because to get that uranium, to get that oil and gas, I mean, it's going to take at least three. The case we make in the...”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Well, everybody's 401k. Like the entire 401k ecosystems of America, that system is massively long, the same trade. Everybody's in the same stocks. Everybody's in growth. And when you think about commodity bill markets, it's like turning around an aircraft carrier. You know, if you just think about CFOs and the natural gas space, chief financial officers and say the copper space, they've all been like, they just saw their last five bosses get shot because the investments that they made from 2000, say 10, 11, 12 to 14, you had a pretty incredible bull market at commodities. Then there was overinvestment and a lot of these CFOs today saw their previous bosses get shot. So we're massively underinvested in say copper, oil, and gas. There's a lot more capital discipline. And on top of that, the politics.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Daunting. And the last thing is this just that the stocks you want to own this way, you have to buy this book when markets speak because the stocks you wanted to own, the stocks that commanded the larger part of the market instead of 60s, 70s, 80s each decade have been very different. And so in disinflationary regimes, your big cap growth stocks, you know, your apples, your Microsoft, they typically do really well in discipline regimes. Whereas in an inflationary regimes, you know, your general electrics, your industrials, some of your oil and gas, Exxon was the largest kit on the blog for a long time. And so the makeup of the market changes dramatically over the last like 50 years. And we think we're on the cusp of a colossal migration of capital based on that shift.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Standard of living around the world. And so energy consumption globally, I mean, if you're in India and a call center, you might make 10, 20 times more than your great big, great, sorry, your great-grandparents. So your energy supply has been constrained by lack of investment, by ESG and things like that, which and just regulation. So your supply of energy and metals has been suppressed. which comes from countries like I said, countries like India. Your demand is really exploding. And we've calculated if you take the 2010 to 2014 regime of what we call commodity bull market and investment, we're about $3 trillion behind that previous path. And so that's pretty.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Well, think about COVID, right? COVID burnt the supply chain chains broke down. So right there, thousands of CFOs around the United States, around the world, were burnt. And they were because they didn't have a backup supply chain. They basically were too tied into, it was complacency, massive complacency where they were too complacent around, okay, these supply chains are going to be smooth as silk for a longer period of time. deflationary in a world where the supply chains like think of what's happening in the Zoe's Canal, think of what's happening on the Panama Canal now with just a water tables. Think of what's happening all around the world. The supply chains just aren't working as well. And not only that, we've decimated the rust belt in the United States. We've taken 5 billion jobs out of the United States. And we've sent them all over the world to India, Bangladesh, China. And so we've raised that.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Think about the last commodity bull market, 2008, 2014. At one point, the energy sector was the same size as the Nasdaq 100. So the energy sector was about the same size as the NASDAQ 100. Today, the Nasdaq 100 is 18 trillion larger. Okay, 18 trillion larger than the energy sector. NVIDIA itself is 5% of the S&P. That's in artificial intelligence. 5% of the S&P. The energy sector is 3% of the S&P. And so everybody's long, we call financial assets. They're along growth stocks. Nobody's really long hard assets or commodities. They're massively underowned because everybody's looking back at the previous regime. Everybody's looking back at Lehman and COVID in that period of disinflation in the post-Lehman world. And now we're coming into like a 1968 to 1981 regime where different asset classes outperform.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Every regime. That's why you got to read this book when markets speak because trillions of dollars, we're talking about a multi-trillion dollar migration of capital and nobody's prepared for it.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“And if Trump wins the next election, tariffs, Biden kept the Trump tariffs, that's inflationary, right? The power of labor. Labor unions are, I think, two to three times stronger today than they were, say, 2010, 11, 12, 13. So you've got all these sources of sustained inflation that are coming at us. And now you have in a multipolar world more conflicts. We've got two wars and Neil Ferguson, when I sat down with him years ago, he's the one that opened my eyes to this. He said, Larry, wars are the most, like think of the Vietnam War. Wars are inflationary. We had that incredible inflation in the 70s. And so we've got drones, Jack, drones. that are taking out ships in the Zuitz Canal. They're taking out two to three former refineries in Russia in the last month. And so all of those things are inflationary. So we're coming into this more sustained inflation.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Response is $16 trillion. So Lehman Brothers, $4 trillion, $16 trillion fiscal and monetary. And then we have a more multipolar world. So not only do we have four times the fiscal and monetary in terms of trillions of dollars more. But we also have a more multipolar world, a world with more conflicts where the people don't trust the supply chains anymore. People want to reshore. Companies want to reshore. The Biden team saw what Trump did with kind of reshoring and bringing manufacturing back and promising to bring those jobs back. Biden's basically picked up the Trump torch in that regard. You see, that's what some of this semiconductor that chips legislation, all these many different types of legislation that are just attempting to reshore jobs because of this populist movement in the United States. All of that's inflation.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Thank you. And so that's the reason why that's important. When I was at Lehman, I was a trader in the high yield distress businesses. And the fiscal and monetary response, Jack, to Lehman Brothers, right, was about $4 trillion. And that's fiscal and monetary response. We had an austerity period after the 2012 election where Republicans and a lot of people on the hill were really responsible around spending, right? Or overly, as some people would say and not responsible. And so some people would say like over, I guess too much responsibility. What if you want to say it was austerity regime and you in the US we had an austerity regime in don't forget Greece, right? So we had all these austerity regimes and now we're in a period after COVID. Think of COVID and the inflation reduction activity. Everything that's come out of Washington fiscal monetary.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“So in my first book, it's now in 12 languages. It's a New York Times bestseller, a colossal failure common sense. It was voted as a top 20 all time, all time at the CFA Institute, top 20 book. Very good. I enjoyed it.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“There's more people in the conversation. This is like an institutional chat, a conversation. It's like a live ideas dinner. And that's our business, the Bear Trap Seport. And the more people are looking at hard assets versus financial assets. So they're looking at uranium, oil, and gas, metal, all kinds of different metals in the types of metals that will basically be the foundation for our future in terms of our power grid, in terms of our energy sources, in terms of how we actually fulfill a lot of these expectations like artificial intelligence like we can get into.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT
“Really appreciate the shout out. One of the things about this book is We run a conversation on Bloomberg with institutional investors in 30 countries. And over the last 10 years, we work with professional investors, hedge funds, mutual funds, pension fund managers around the world. And what I'm trying to do with this book is to democratize information. That's why you've got to read this book, because if you want to know what really happens behind the scenes, how we formulate ideas, mosaic research, Jack, is like taking a piece of information or a thesis and then surrounding it with other pieces of information to make it stronger or weaker, right? So you can identify weaker investment thesis versus strong one. And what I've noticed in the chat the last two, three, four years is the amount of people that are focused on a more sustained inflationary regime that are really smart investors that we trust, that we know, that group of people is growing.”
2024-03-29 · Forward Guidance · Inflation Isn’t Going Away And Investors Own The Wrong Assets | Larry McDonald on “When Markets Speak” · IDENTIFIED FROM THE TRANSCRIPT