Guest Alex Gurevich, Honte investments fund manager, discusses the reasons behind the recent underperformance of the long duration trade. The podcast also explores the persistence of inflation, the challenges of transitioning to renewable energy, and geopolitical risks in Israel and the Gaza Strip.
Read more
AI Summary
AI Chapters
Episode notes
auto_awesome
Podcast summary created with Snipd AI
Quick takeaways
Inflation may have a self-reinforcing nature and loose policies in 2021 have contributed to its persistence.
Risks of escalation in the Israel-Gaza conflict could have significant impacts on the oil market.
Differing opinions exist on the future of energy transition and fossil fuels, with potential risks to oil prices from disruptions in supply.
Deep dives
Alex Garravitch's assessment of inflation and deflation
Alex Garravitch discusses his assessment of the persistent nature of inflation and its self-reinforcing nature. He acknowledges that he did not fully appreciate the self-reinforcing nature of inflation and the impact of loose policy in 2021. He also explores his views on the future deflationary cycle, which he believes will be more severe and prolonged than previously predicted. Garravitch highlights the importance of employment as a key driver of the cycle and discusses the potential risks and uncertainties in his deflationary outlook.
Geopolitical tensions and oil market implications
The podcast episode highlights the developing situation in Israel and the Gaza Strip and the potential impact on the oil market. The hosts discuss the risk of geopolitical escalation and the possibility of a broader regional conflict. They emphasize that the situation is far from over and that the risk of upside price movement in oil remains high. They argue that the market should not overlook the potential for a significant escalation and highlight the need for caution in assessing the situation.
Technical analysis of S&P 500 and market outlook
The podcast provides a technical analysis of the S&P 500 and discusses the levels to watch in the market. They highlight the key resistance level at 4400 and the support level at 4300. The implied move for the upcoming options expiration is also discussed, suggesting a potential move to the upside of around 4460 and a move to the downside of around 4300. The hosts express caution regarding further upside in the short term and suggest that a potential breakdown below 4300 could indicate a continuation of the market selloff.
Opinions on Energy Transition and Fossil Fuels
The podcast discusses differing opinions on the future of energy transition and fossil fuels. One viewpoint suggests that while there will be new sources of energy in the long run, currently there are government regulations and infrastructure limitations that will prevent fusion energy from being commercially viable soon. This viewpoint believes that oil prices will continue to rise in the next two to three years, except in the case of a global depression. Another viewpoint agrees on the potential for increased oil prices due to continued demand and limited supply, but highlights the risk of a significant spike in oil prices if supply is disrupted. It also emphasizes the importance of addressing the potential impact of a deep recession on oil prices and the need for an oil crisis to recover from such a recession.
The Role of AI and Regulatory Challenges in Energy Transition
The podcast explores the role of AI in solving control problems in nuclear systems such as fusion and fission. It suggests that AI can provide better solutions to the complex control challenges faced in these systems. However, it acknowledges that regulatory and political factors present significant hurdles to energy transition, regardless of whether fusion, fission, or other renewable energy sources are pursued. The host believes that while AI can accelerate technological advancements in energy solutions, the actual implementation and regulatory processes may take longer than expected. Additionally, the podcast discusses the potential impact of the limited supply of dollars in the world on the oil market, suggesting that a rise in energy costs and the need to pay in more expensive dollars could lead to a contractionary effect on the global economy.
MacroVoices Erik Townsend and Patrick Ceresna welcome back, Honte investments fund manager Alex Gurevich. Erik and Alex discuss the reasons why Alex is still committed to the long duration trade long-term, and why that trade hasn’t been performing recently. https://bit.ly/3RW7Hcj
