On technical analysis

… 2 weeks to study and pass the series 7 and then they hand you a book on technical analysis. Read that.. I read it, read it again… I read it again, read it a third time, I read it third time, “You ready to trade / open accounts”

 

On current markets

Right now when you look at any asset price, you have to be thinking that this is a highly dubious, unsustainable price. I say that for a couple of reasons.

I don’t think monetary policy, the way it’s currently conducted is sustainable over time. If you think about history, the normal real 10-year rate is 200 bps and the normal real short-term┬árate is about 100-120 bps. Right now it’s too low. Clearly, interest rate policy is crazy. Rates are ultimately not sustainable. Ultimately like in the late 60s, rates were manipulated and were very low. People got used to low rates which set things up for the 70s. I think we are doing the same thing again. So I don’t think monetary policy is sustainable.

Fiscal policy is not sustainable too.

In the long run, asset prices had to mean revert back to a normal real rate of interest, normal term premium that had existed for the last 250 years. We have to get back to sustainable fiscal policy and that probably means the price of asset go down, in the very long run.

In the short run, jet up, ready to go!

Just imagine, the next recession comes, the next recession is really frightening because we don’t have any stabilizers. We have monetary policy stabilizers which we will exhaust very quickly but we don’t have any fiscal stabilizers.

In 2000, the last time we were 3.8% unemployment, we had a 2.5% budget surplus.

 

On philanthropy

Focus on the outcome. Not that effort is not important but you have to be goal oriented. You have to be held accountable.

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