Guests Kevin Coldiron, Jamie Lee, and Tim Lee discuss the rise of carry and its impact on financial markets. They explain how carry trades dominate market behavior, driven by low interest rates and declining volatility. They explore the consequences of carry trades on asset prices, social instability, and global liquidity. The speakers also discuss the relationship between carry, leverage, and debt, highlighting the unsustainable nature of the current financial model. They delve into the shift towards extraction in finance, where profitability is sacrificed for shareholder returns.

In this discussion, Tim Lee, the founder of Pi Economics known for his insights on financial markets, and Kevin Coldiron, a financial engineering lecturer at UC Berkeley, dive into the concept of carry trades. They explain how policymakers' suppression of volatility has turned the economy into a massive carry trade, distorting asset prices and intensifying income inequality. The conversation touches on the implications for liquidity and market behavior amidst rising risks, and questions the future of fiat money in a world increasingly influenced by cryptocurrencies.

Tim Lee and Kevin Coldiron discuss the impact of carry trades on emerging markets, implementation of transaction taxes in Latin America, and the repercussions of central bank interventions on carry trading and future monetary policy.