Hope all goes well… Lindsay Politi, who joined One River to manage a fund focused on opportunities in inflation markets, is authoring Weekend Notes during my late-summer hiatus. She came from Tudor and previously built/ran a $10bln TIPS business for Wellington. For the next two weeks, she’ll share her thoughts and ideas on inflation as well as conversations she has had with institutional investors, managers, and endo

Hope all goes well… Lindsay Politi, who joined One River to manage a fund focused on opportunities in inflation markets, is authoring Weekend Notes during my late-summer hiatus. She came from Tudor and previously built/ran a $10bln TIPS business for Wellington. For the next few weeks, she’ll share her thoughts and ideas on inflation as well as conversations she has had with institutional investors, managers, and endo

“The Japanese experience has given investors the incorrect impression that sustained deflation is a likely outcome when it’s instead a unique case,” I explained. We were discussing US inflation, whether it is increasing or decreasing. Shorter-term economic and price trends are inherently volatile, so to examine inflation properly requires greater perspective. Which had brought us to Japan. Implicitly, Japan decided t

We met a large public pension because they were unhappy with their inflation-linked bond performance. I remembered when public pension funds added inflation-linked bonds to their policy portfolios in 2011/12. Around that same time, I was asked to advise a client about TIPS (Treasury Inflation-Protected Securities). They wanted to develop their own version of a risk parity portfolio. They were using historical returns

Hope all goes well…I usually recycle old anecdotes during my August break from writing. But I asked Lindsay Politi, who joined One River to manage a fund focused on opportunities in inflation markets, to author Weekend Notes during my hiatus. She came from Tudor and previously built/ran a $10bln TIPS business for Wellington. Lindsay has spent the last few months speaking to a diverse cross section of institutional in

Hope all goes well… I take Aug through early Sept off from weekend notes. Dusted off an anecdote from 2015 about the dangers of genius, the value of experience (see below). Enjoy your August. E Week-in-Review (expressed in YoY terms): Mon: China’s renminbi stabilizes following Friday’s hike to 20% reserve requirements for speculative shorts, Saudi Arabia expels Canadian ambassador after Canada supports detained human

Hope all goes well… The US and EU account for over 50% of global GDP and have the world’s largest bilateral trade relationship, exchanging $1.1trln of goods and services annually; there’s no more integrated economic relationship on earth. One-third of world trade involves the US and EU – the US is humanity’s #1 customer, accounting for 18% of all imports, the EU is #2 at 15%. Total US investment in the EU is 3x

“Every investor needs a mental model,” said the CIO. “Without one we’re lost.” We weaved through New York. “I developed mine years ago,” he said, crossing Lexington, mid-block, diagonally, headed south. “Markets move in cycles. After a euphoria comes the fall. But euphoria tends to persist.” The lights toggled on our approach to Park and 61st, we made our way, a steady pace. “Late cycle, if enough people ignore the w

“Global trade is a never-ending prisoner’s dilemma,” said the CIO, explaining that we’re collectively better off through cooperation but nevertheless periodically seek short-term advantage by exploiting the blindly optimistic. “The most successful prisoner’s dilemma strategy is ‘tit for tat’ in which both players cooperate initially.” But once one player chooses non-cooperation, the opponent retaliates with non-coope

Hope all goes well… I’m not thrilled,” said the President. “Now, I’m just saying the same thing I would’ve said as a private citizen,” continued the property developer. “So somebody would say, ‘Oh, maybe you shouldn’t say that as President.’ I couldn’t care less what they say, because my views haven’t changed.” The Federal Reserve’s 7 hikes widened the chasm between US interest rates and those of our foes. And Powell