We Study Billionaires - The Investor’s Podcast Network

TIP396: China and the Macro Impact w/ Kyle Bass

6 snips
Nov 14, 2021
Guest
Kyle Bass
Kyle Bass, founder of Hayman Capital Management and known for his foresight in the 2008 financial crisis, dives into the complex world of macroeconomic investing. He discusses alarming trends in China’s economy, including concerns over real estate and demographics. Bass advocates for farmland investments as a hedge against inflation and explores the implications of China’s new central bank digital currency. He also critiques Bitcoin amidst regulatory challenges and highlights the potential spike in oil and natural gas prices.
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ANECDOTE

Hayman Capital's Start

  • Kyle Bass's Hayman Capital started by focusing on long Asian equities in 2006.
  • Research into the US housing bubble led them to short mortgage bonds, resulting in major success.
INSIGHT

Asymmetrical Bet

  • Kyle Bass's conviction in the housing short was supported by an asymmetrical risk-reward profile.
  • His downside was limited to a small annual loss, while the upside potential reached 80-100%.
INSIGHT

No Bubble Today?

  • Kyle Bass argues that the current market isn't in a bubble like 2008 due to increased liquidity.
  • He believes the 40% increase in money supply will cause a similar decrease in purchasing power.
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