“I can generally, take an issue and argue both sides...ultimately you've got to weigh all the evidence and be honest with yourself and come up with the right answer… the ability to take an issue, see both sides, argue both sides, build a case for both sides…and that causes you to just dig and read and turn over stones and understand underlying processes and things like that.” - Warren Pies, 3Fourteen Research

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This episode features Warren Pies of 3Fourteen Research. Chase and Warren dig deep into construction data, Warren’s process, models, and why he finds construction so important for macro. Warren teaches us how to research trades like a lawyer, but also how important saying, “I don’t know” is for your credibility…unless you’re at a cocktail party. He argues that sticking to what you know and picking high quality businesses will keep you alive in the markets. We also learned that Gothic Western Fiction is an actual genre (!?). Enjoy this meeting of the minds and learn how to balance granularity with accuracy.

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Timestamps:

(00:00) – Intro & Plugs

(01:20) – Warren’s Charity: BridgeALife

(02:57) – Warren’s Framework on Housing, Construction, and Construction Employment

(16:07) – Argue Both Sides of a Trade Like a Lawyer

(18:49) – A Behavioral Edge Creates an Informational Edge

(19:37) – Preempt a Bad Trade Through Research and Process

(21:26) – Learn How To Say, “I Don’t Know” Unless You’re at a Cocktail Party

(23:59) – Stick to Investing in What You Know & Pick Quality Businesses

(27:45) –Speed Read Until AI Can Do it For You

(31:13)— Exercise Your Nervous System to Help Connect the Dots

(33:36) – Having to Rescind a Prediction Made Publicly is Tough

(38:45) – Blood Meridian – Gothic Western Fiction??

(42:22) – Understanding Modern Money – A transformation for Warren

(42:34) – Between Two Pines

(47:48) – Are Higher Rates Stimulative?

(50:52) – Self-Reinforcing Loops to the Downside

(55:01) – Malinvestment in the 2020s

(56:39) – Yellowstone is “Too Popcorn”

(59:40) – Thank You Listeners

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This Episode's Charity:

Bridge A Life Charity – Local group in Sarasota Area, Florida that provides resources to foster families.

Donate here: https://www.bridgealife.com/get-involved/donate-2021

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Referenced in the Show:

1.  Warren’s Market Huddle Interview
2. Books:  Blood Meridian by Cormac McCarthy  & Understanding Modern Money: The Key to Full Employment and Price Stability by Randall Wray
3. David Einhorn – The Long and Short of Investing
4. Warren Mosler – This Guy Says the Fed Has Got Everything Precisely Backward, 2022, NYT Article

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Guest Plugs:

Warren’s X : https://twitter.com/WarrenPies

3Fourteen Research: https://www.3fourteenresearch.com/

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Pinecone Macro Research aims to provide unique, well researched analysis of the global markets using a macro framework. Find us here: www.pineconemacro.com

Follow us and the show on Twitter: @PineconeMacro & @TaylorMadeMacro

Subscribe on Substack: https://substack.com/@pineconemacroresearch

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Bulwark Capital Management: https://bulwarkcapitalmgmt.com/

Disclaimer:

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The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status or investment horizon. You should consult your attorney or tax advisor