https://twitter.com/LongShortTrader/status/1135717118261907456

What’s obvious is obviously wrong… The present is already in the price… And it’s margins and capacity that matter

The major thing we look at is liquidity, meaning as a combination of an economic overview. Contrary to what a lot of the financial press has stated, looking at the great bull markets of this century…Once you understand how and why liquidity works, you’ll fully grasp the old Wall St. adage of “Don’t fight the Fed”. The Fed controls the biggest lever on global liquidity. And liquidity is what drives stocks… NOT the economy.

the best environment for stocks is a very dull, slow economy that the Federal Reserve is trying to get going

The BEST interview I’ve ever seen on Stan Druckenmiller:



Stan Druckenmiller holds one of the best, if not the best, long term track records on Wall Street. He’s thoughtful, logical, and a-political. Global trade > protectionism and nationalism. Innovators the disrupted. China opportunities in favorites like Alibaba & TenCent, and more.

Druck talks about the macro environment, the micro fundamentals, Trump’s lunacy with trade wars, and what he see’s next.

This is a rare interview so I urge you to take a listen, the really good stuff starts at about 25 minutes but every word is worth the listen.

Bottom line:

• Trump is slowing this economy and isolating us from our top trading partners - bad idea

• He’s heavy in Treasuries now but doesn’t see the real value over time, just as a risk-off allocation

• His focus continues to be on the innovators and the disruptors vs the disrupted

• He believes lots of stocks in China have significant long term potential, cited BABA & TCEHY

• The Fed missed their opportunity early in the cycle to slowly hike rates, they are now behind the curve

• He does not agree with the Fed 2% inflation target - it means nothing they should ignore it

• He does not see a recession near term but admits this “idiotic” trade war could tip the USA in a recession

• There’s far too much corporate & government debt currently and that’s a very big worry if growth really slows

• He is off-consensus currently with his view that Trump will NOT get re-elected given the volatility and uncertainty he has created.

• Xi in China is more likely NOT to deal with Trump given his unprofessional and childish negotiation tactics added to bullying and public humiliation.

• There’s a bear market in politicians - Well said - they are adding no value and only confusion and uncertainty.