Harley Bassman, managing partner at Simplify Asset Management and widely known as the “Convexity Maven,” joins Monetary Matters to break down the hidden risks shaping today’s markets. He explains why inflation is likely to remain structurally higher, why massive fiscal deficits matter more than Fed policy, and how passive flows continue to support equities despite growing cracks underneath. The conversation dives deep into bonds, mortgage-backed securities, credit risk, gold as an alternative currency, and why convexity is the key concept investors consistently underestimate. Bassman also outlines practical portfolio hedges designed to perform when markets move to extremes, offering a rare, long-horizon framework for navigating uncertainty in 2026 and beyond.
Read Harley’s 2026 Stocking Stuffers here: https://www.convexitymaven.com
Follow Harley Bassman on Twitter: https://x.com/ConvexityMaven
Follow Jack Farley on Twitter: https://x.com/JackFarley96
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Timestamps:
00:00 Introduction to Financial Crises and Convexity
00:30 Meet the Convexity Maven: Harley Bassman
01:08 Macro View: Inflation and Economic Drivers
01:48 Demographics and Spending Trends
03:24 Immigration and GDP Growth
04:21 Fiscal Policy and Inflation
05:36 Bond Market Predictions
13:27 Equity Markets and Passive Flows
17:31 Mortgage-Backed Securities: A Safe Bet?
23:51 Leveraged Trades and Interest Rate Hedges
32:09 Comparing Long Duration Investments
33:50 Understanding Positive Carry in Options
40:36 Private Credit and High Quality BDCs
48:48 Investing in Big Oil and MLPs
55:03 Gold as an Alternative Currency
01:00:12 Portfolio Construction and Sizing
01:01:50 Conclusion and Future Episodes
