Making Markets
George Robertson: The End of Monetary Policy - [Making Markets, EP.16]
Feb 9, 2024
George Robertson, a highly interesting and contrarian investor, discusses his colorful career, the diminishing power of the Federal Reserve, and provocative claims on the market for US treasuries. He highlights the loss of the Fed's reaction function, the outcomes of their asset purchases, and the impact of massive government spending. Robertson also explores the role of sentiment and macroeconomics, concerns about market rigging, and shares insights on the current sentiment cycle and market manipulation.
54:38
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Quick takeaways
- The Federal Reserve's actions and narratives have lost their power and no longer result in significant economic changes.
- The Fed's shift towards forward guidance and reliance on narratives and predictions may not be aligned with actual economic conditions.
Deep dives
The Role of Sentiment and Macro in the Market
In this podcast episode, George Robertson discusses the two main influences in the market: sentiment and macroeconomics. He explains that sentiment, which can be based on technical analysis and short-term market movements, is distinct from macroeconomics, which focuses on long-term trends, economic indicators, and the Federal Reserve's reaction function. Robertson emphasizes that the Federal Reserve's actions and the narrative surrounding them in recent years have lost their power and do not result in significant economic changes. Instead, he predicts that the market is entering a speculative phase, which may lead to increased volatility and potentially a crash in the future.
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