5min chapter

The Macro Trading Floor cover image

Debt, Demographics & Deflation Ahead | Raoul Pal

The Macro Trading Floor

CHAPTER

Is There a Recession Coming? Riaz, I'm Not Overly Long Bonds Yet.

Riaz: Who cares about the talking heads if unemployment starts rising and regular people will have to withdraw funds from fund managers as a consequence of it. I think that's a very practical way of understanding why a recession could lead to another sell-off in equities. Cash flow is king right now due to the discount rate, which is healthy due to the things that we discussed with Rohan. And last word is on the skew because you talked about retail buying puts. If you look at the slope of the implied volatility across strikes actually upside coal is much more expensive in both terms than downside puts nowadays.

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