Ivan Yates

let's say the S&P 500 is a bubble because of cheap money and money flows into, has inflated the value.

But there's also an anti-bubble, and that is assets that are unloved, that haven't got capital, like gold stocks, for example.

If you look at the S&P 500, that's the index of all the shares, top 500 companies in America, okay?

Dominated by technology stocks, as we know, dominated by the minutes and seven.

But gold companies, for example, or mining stocks, for example, are only 2%, 2% to 3% of that whole index.

So this is his framework where the bubble is the tech and the anti-bubble is the mining stocks.

And they're both related to each other.

They're both feeding off each other.

So his framework is, yes, the bubble is obvious, but the anti-bubble is also obvious.

And the anti-bubble is what you should be buying.

because that is related to what you should be selling, if that makes sense.

The misconceptions are that central banks and governments are always going to save the day.

Okay, they have a point where it doesn't... Could the solution be worse than the problem?

Well, the solution always was, okay, the basic thing with central banks was if you get inflation like we got in 2022, you raise interest rates high enough that it kills aggregate demand in the economy, slows down the economy, like you said, kills the patient, okay?

Yeah.

But that's the design.

You know, we're in 2025 and that's the best we can do.

And that's a kind of a common theme throughout this series is the best we can do is just kill aggregate demand, cause a recession that beats inflation.

OK, but what if central banks are no longer able to write to the rescue?

What happens then?