Asset protection

Big Fat Idea – Taking Advantage of the Commodity SuperCycle

Posted by MoneyTalks Editor

on Monday, 5 April 2021 12:21

Andrew Ruhland shares with Mike his strategy Core and Explore strategy – and how it offers a safe, structured and sophisticated way to take advantage of the Commodity Super Cycle.

It’s time to officially bury Goldbug Macro

Posted by Joe Weisenthal - Bloomberg

on Monday, 5 April 2021 8:59

 

You know, the school of thought that’s always warning about dollar debasement and inflation as a result of money printing.

Here is a chart of gold over the last 10 years. It’s up about 10%. During this period we’ve run large deficits the entire time, and in fact over the last year, some of the biggest fiscal stimulus of all time. During this time the size of the Fed’s balance sheet rose to nearly $8 trillion from under $3 trillion. Not only has gold performed poorly, the dollar is still dominant.

Not only that, inflation has been mild, contra to what all the Goldbug Macro types would have predicted. Of course, they would probably come back and say that inflation is actually being mis-measured and that it’s way higher if only you look at it the right way. Or that it’s showing up in asset values or something like that. Even if you were to grant all that as true, gold hasn’t benefited, so their case hasn’t been helped much. As we saw in the wake of the Great Financial Crisis and over last summer, gold seems to do well during periods of stagnation plus aggressive Fed easing. But that’s about it. After two huge crises in just over a decade, plus fiscal and monetary stimulus the likes of which we haven’t seen before, we now have enough evidence to bury the economic fantasies of gold’s most ardent believers.

Retaliatory tariffs on everything from grand pianos to anchovies could total almost $1 billion a year

Posted by Ana Monteiro

on Monday, 5 April 2021 8:46

U.S. forges ahead with plan to slap tariffs on nations that tax digital giants

The U.S. is pressing ahead with plans to hit six nations that tax Internet-based companies with retaliatory tariffs that could total almost US$1 billion annually.

Goods entering the U.S. — ranging from Austrian grand pianos and British merry-go-rounds to Turkish Kilim rugs and Italian anchovies — could face tariffs of as much as 25 per cent annually, documents published by the U.S. Trade Representative show. The duties are in response to countries that are imposing taxes on technology firms that operate internationally such as Amazon and Facebook.

In each of the six cases, the USTR proposes to impose tariffs that would roughly total the amount of tax revenue each country is expected to get from the U.S. companies. The cumulative annual value of the duties comes to US$880 million, according to Bloomberg News calculations.

There have been efforts to replace each individual country’s digital taxes with one global standard — to be brokered by the Organization for Economic Cooperation and Development — but a deal has yet to be reached.

Read More

 

Bill Hwang recently lost $8B of his own money over a 10-day span. That’s $9,259 a second

Posted by the HUSTLE

on Monday, 5 April 2021 8:28

 

Talk about a rough week at the office.

Over the past week, Wall Street has been picking through the implosion of a $10B fund called Archegos Capital Management.

A number of highly leveraged bets went sideways and the fund — run by industry vet Bill Hwang — went poof virtually overnight.

Per The Wall Street Journal, Hwang is purported to have personally lost $8B in 10 days while 2 global lenders (Credit Suisse, Nomura) are also reporting 10-figure losses.

While these numbers are big…

… the longer-term effects may send ripples through a much larger pile of money: The family office industry.

Family offices are privately held companies that manage assets for the superrich ($100m+ in investable assets) with the goal of preserving wealth over generations. The source of the funds can be from generational wealth or uber-successful entrepreneurs.

Per the Financial Times (FT), the industry’s numbers are staggering:

  • 7k+ family offices globally (up ~40% between 2017 and 2019)
  • ~$6T in assets under management across all the offices (nearly 2x the hedge fund industry)
  • $1.6B is the average family office holding

Here’s the kicker: the industry is very lightly regulated

While hedge funds, endowments, and pensions are accountable to outside money, family offices are able to stay a secretive affair.

Dan Berkovitz — a commissioner of the Commodity Futures Trading Commission (CFTC) — believes the current disclosure requirements are totally insufficient as reported by FT.

“The information required would fit on a Post-it note,” he said in a statement regarding Archegos. “And… the annual cost of the filing [is] merely $28.50.”

What will happen next?

While many family offices employ boring financial strategies to preserve wealth, Archegos — which had a peak portfolio value of $100B+ boosted by bank leverage — shows the risk.

Even though Hwang admitted to securities fraud in 2012 (and paid a $44m fine), leading investment banks were happy to have his business.

In the aftermath of the real estate crisis, the 2010 Dodd-Frank Act tightened financial regulation. Post-Archegos, the industry may see new rules for family offices, banking services, and the specific financial product used in Hwang’s trades (called total return swaps).

All of this seems totally reasonable…

 

Live Webinar – Intelligently Profit from the Commodity Super Cycle & Rising Interest Rates

on Friday, 2 April 2021 15:33

With government printing presses running in 5th gear, massive green spending initiatives & monetary policies creating significant risk for fixed income investments… the Commodity Super Cycle presents an exceptional opportunity for investors. Join Andrew Ruhland immediately following the show at 10:05am pacific / 11:05am mountain time as he shares:

  • Opportunities created by “Build Back Better,” Money Printing & Infrastructure Spending
  • How to carefully invest in emerging opportunities in energy, metals, clean tech, agriculture and nuclear
  • How to position income generating assets to benefit from rising interest rates
  • How to shift your portfolio to take advantage of inflation

CLICK HERE to register