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Season 2, Episode 12, Transcribed: The Next Stage of the ‘Market Melt-Up’ With David Hunter

Moderator 0:02
Welcome to the Contrarian Investor Podcast. We give voice to those who challenge the prevailing sentiment in global financial markets. This podcast is for informational purposes only. Nothing on this podcast should be taken as investment advice. Guests were not compensated for the appearance, nor do they supply payment in order to appear. Individuals on this podcast may hold positions in the securities that are discussed. Listeners are urged to educate themselves and make their own decisions. Now, here’s your host, Mr. Nathaniel, E. Baker

Nathaniel E. Baker 0:36
David Hunter, Chief macro strategist at contrarian macro advisors. You were on the show last summer in August if memory serves, and you told listeners about your idea that there would be a dramatic melt up that would be caused by central baank liquidity, injections and other measures. And anybody who’s been paying attention to markets in the last couple of weeks, could reasonably point out that this is exactly what’s happened here with the Fed, and other central banks, mainly the Fed, stepping in to combat the coronavirus impact, and unleashing all kinds of liquidity. So, I guess that would be the first question for you is where we stand with this. And if this is indeed the start of this melt up?

David Hunter 1:37
Sure. Yeah, I think this is definitely the start of what I think will eventually become a parabolic melt up into a secular top. And in all honesty, when we talked last, I guess, late August, I didn’t anticipate the coronavirus by any means and didn’t anticipate that we’d get down under 2200 on the S&P, I thought we might in fact in January, February, March. I was talking about January, February, early March, I was talking about a correction back to 3000, maybe 2900. But I certainly didn’t see the the cascade that we we got. So, you know, the coronavirus certainly affected the path. But my target of 4000 plus on the S&P, which I had last summer is still my target today. We had another leg down. It took us down to a deeper bottom. But I think it didn’t change the fact that we are going to have this final melt up into a secular top, a top that I expect to be the high watermark for decades to come.

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Season 2, Episode 14: The Anti-Quant Quant, Beating Indexes With Three ETFs

With Chad Glauser, Alpine Quantitative Management

Chad Glauser of Denver-based Alpine Quantitative Management joins the podcast to discuss his fund’s strategy of using just three ETFs as a way to manage risk, gauge volatility, and produce returns.

The three ETFs track short-term Treasuries, long-term bonds, and the S&P 500. Alpine has been actively trading the strategy since late 2017 after an incubation period of about two years. The approach has worked, with the fund beating the hedge fund index for 22 straight months (and counting).

Content:
(Spotify users can click on the timestamp to link to the segment in question)

  • About the strategy: quick background and using volatility as an indicator (1:10)
  • The “real-world example” of what happened in January and February, and how the fund adopted (2:42)
  • How often, and quickly, the portfolio adjusts and why it is 100% allocated at all times (4:39)
  • The current view of markets (5:46)
  • Why Alpine views itself as the “anti-quant” quant (9:04)
  • Background on Chad Glauser (12:35)
  • How to get in touch (20:04)

Quick Video Highlight via Our YouTube Channel

For more information on the guest:

Not intended as investment advice.

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Season 2, Episode 12: Market ‘Melt Up’ Will Continue Until Late Summer, Before Onset of ‘Global Deflationary Bust’

With David Hunter of Contrarian Macro Advisors

David Hunter, chief macro strategist at Contrarian Macro Advisors, has for some time predicted a final “melt up” stage of the market cycle before markets crash.

This stage is now underway as markets recover from an initial sell-off caused by the coronavirus (which Hunter admits he did not and could not have predicted).

What comes next is a “secular top that I expect to be the high-water mark for decades to come,” he says. After markets peak around late summer, a “global deflationary bust” will ensue, with as much as 80% downside for equities.

Content: 

  • Target of 4,000 for the S&P as part of “the final melt up” (2:23)
  • The downside target. Forget the “retest narrative” in the short term (10:39). Markets should drop by 80% from the top (11:58)
  • Unprecedented leverage doesn’t leave policymakers much time (14:09)
  • Background on David: 47 years in financial markets (18:46)
  • The current crisis in historical context (26:35)
  • Deflation allows for liquidity injections. Until it creates inflation (32:01)
  • Discussing the potential political and social fallout from the coming economic crisis (36:12)
  • How deflation will eventually turn to inflation (40:20)
  • Discussion of the U.S. dollar’s reserve currency status (45:56)
  • Bullish outlook for gold and silver (51:37)

Quick Highlights From Our YouTube Channel

For more information on the guest:

Not intended as investment advice.

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