for those guys and something's gotta give and that something is the price right the price is gonna go up the howlers are going to feel bad make it make it a so easy making this money go four hundred thousand dollars now i did the math quickly in my head wow are sitting here the compound rate of return we're talking about is one percent a day i like that number yeah actually i just made that up because it was going to run out for are today it's not that far off and here's the funny thing so on twitter i'm out actually on twitter too at mark hughes go and i think a lot of grief because people so how much you putting of your client money in this i say look we talk lance all along one percent in national crypto currency is another one to three percent in the picks and shovels you know the coin bases it cetera and well if you think it's going to go up so much why not more so well because there's still a non-zero risk i think is a very low but a non-zero risk that it could get displaced by a better technology i don't think that's going to happen i think the miracle of bitcoin was going from point six cents two hundred dollars the fact that that happened was the miracle one hundred thousand not

a miracle thousand to ten thousand not a miracle ten thousand to one hundred thousand not a miracle so but it's still not zero that something could come in now open source makes that better the risk is lower because of something great comes out we can take copy paste that new technology onto the big block chain so i do think that over time i'll get more confidence to have a bigger position but like anything in life you start small when things go your way you double up and was one of the things that julian robertson one of my mentors great hedge fund manager was amazing at he said you never average down losers average losers you always double things go up tend to go up exactly go down tend to go down exactly now year you've got a billion or so under management sounds like a lot but actually in the grand scheme of things that's not a lot of enough are you the top dude over there is a whole i am. maneuverability you know so you can move around whereas a large pension funds large a satish and they have a board they have a committee bitcoin won't be on their radar for a. year two three years i think it's a great great point and we're talking to

a multi you know tens of billions of dollars pension funds i'm going to class now who is going to going i'm going to guess in the guise of the guy had to go to what we would like to be is that in between that allows an institution to get access and we're talking this pension fund and they would love to get involved but they can't write smaller than one hundred million dollars check what's the chatter out there and the pension fund business you know best kind of the mother load in this industry and what's the chatter they know that they want uncorrelated assets you're talking about earlier that's one of the benefits as well j.p. morgan put up the bible of crypto currencies this morning because they want to base that as they want because there's no matter what jamie says the fact is that shareholders want profits of course jamie is just talking pension funds have a problem if you look at everybody's forecast of traditional assets over the next decade where the a.q.r. research affiliates are g.m.o. even vanguard is telling us you're going to make low single digits you actually assumed rate of seven so you're going to get there so you've got to find these one

core of the assets with the private investments to give you an illiquid the premium real estate venture capital center or something like crypto currencies big coin if they are in a center where you're going to get this lift from the network effect that's such an incredible pitch to say that interest rates have been artificially low for years an error is due to the bailouts that are ongoing for the banking sector and your pension rates are as we thought they'd be seven percent but they're actually one percent and to save the day to save america it's got to be bitcoin i mean who would have thought that this was going to be the so there is now let's talk about the vix the vix is the volatility index and what happened with associated e.t.f. products recently regarding these products your thoughts look short selling not that bad. leverage not that bad leverage plus short selling can be bad and so what we had here was everybody and their sister started selling volatility because it was a one way bet in a q.e.

world selling volatility seemed riskless last year the s. and p. had its highest sharp ratio in history but a lot of history more than one hundred ratio is the ratio of return to risk the standard deviation return of a bystander evasion minus the risk free rate the standing ovation last year was the lowest ever at three point eight percent the sharp ratio was four point five the normal sharp ratio is zero point five so nine times less volatile so it was only a matter of time before volatility spiked and when volatility spikes and you're levered short you can lose everything which we saw in ecstasy reminds me of the make it puts that were being written in one thousand eighty seven yes some of us are old enough to remember writing stat more than half of hedge fund managers are less than five years in business well i think that so they don't remember eighty seven and they don't remember two thousand but if you think about portfolio insurance and what it did it was

a pro cyclical strategy right it does more of what's working and what that insures is like passive index funds what does that in short means you have the maximum exposure to exactly the wrong thing when the turn happens and that's exactly happened fix time a warren buffett or so and i totally accept a one million dollar bet with warren buffett you said has found a lot before in the s. and p. five hundred of the next ten years why do you think he'll win this time when others have lost well look the last ten year bet that he made with ted sadie's was was a really interesting bet and for the first five and a half years buffett was behind it was only when q.e. started that the s. and p. had this low volatility melt and hedge funds underperformed sounds like a dog ate my homework you know it's what it is what it is is it. not buying it no i mean buffett is buffett and he knows that over a cycle like ten years time the fed is always going to come in and print money because their constituencies are the banks and they hate is inside the banks he was the chairman of solomon for years he like bailed out goldman sachs his dad was

a stockbroker he's an insider he's not going to make a trivial bet like this i completely agree with you so why do you have a disappointment buffett are you a glutton for punishment no because valuations are so extreme today that will win now the dent into the story is i did talk to him i did think he was going to take the bet three days later he sent me a letter saying his age preclude him from taking the bet so my guess is he's never going to take a bet he can't when he chickened out war and you are a big fat. plucky tail plucking my chicken my my pet chicken because talk about this i want us to start a so some of the bond market now we've been a bull market you know since i started on wall street back in the early eighty's bond markets have just gone up thirty thirty thirty five years. is it ever going to end in fact i was just listening on the ride over here to carol sokol off and if you ever talk to him but you should he's run some called thirteen d.

research and he wrote a book in one thousand nine hundred two inflations ending are you ready to think about one thousand nine hundred two where inflation was thirteen percent nobody thought inflation was going to end every body was buy in equities not bonds and they should have just held them long bonds over the past thirty five years have crushed equity returns come to our terms much i really just don't know how to be long bonds gratian twenty. thirty year there are there's beat the s. and p. over the it's on was a correct it is correct and hoisington runs a phone in austin texas that has a track record to prove it now the key is from here what he was saying is that he believes we've seen the secular low now guys event hoisington would defer they think is not so twenty twenty one but we're get. close to that secular low in rates and at that point bond bear market is going to take over and it's not going to be pretty i don't know where we had a bond sell off you know vicious it's got to eclipse that it would be way worse if

it occurs i argue that it can be tough to occur because just like japan we have a demographic problem every day in this country ten thousand people turn sixty five sixty five eighty five year old people turns out don't spend a lot you know buy a lot and they buy bonds so i think there's going to be more of a bid for bonds and people anticipate because of the growing and it goes back to one or you know conversation about how your fame's right we got to go thanks rob show no thanks for having fun of course is fun the best show ever and i say thanks this is the show anyway we got to go thanks for being here and watching the kaiser report with me a mass kaiser stacy her special guest was mark hughes go there it morgan creek capital there fantastic exposure typically if you're that middle tier you know not the going to catch us on twitter it's kaiser report so next time i.

join me every thursday on the alex simon chill and i'll be speaking to guests of the world of politics school this list i'm showbusiness i'll see you then. now that's just. certain i want to do it just show me face do with really be very clear place go away go to. management. and they on they they when they up then they have.

skimmed you need yeah you feel the. sun yeah i'm them what do you how to become a song like nobody loves local do you wonder. if this was actually my helmet available to measure the more negative cash. elliston is getting international recognition with the help of israel at least in the world of zoos and member wolf it was dismissive to do it like you know that this isn't my cup of tea is going to have no clothes on me all may be a bit. old john no doubt a tough job with a ship the only palestinians who gets the most help from its jerusalem counterparts i don't think this is about those who endure under the oak bush and the know only

because it is who. i know it is unfair advantage to have this lady of the most of that you had i not going to continue muslims you know do more in the middle false don't piss off. rather long. shot. plug plug . the headlines. there are

conflicting reports that. soldiers. recently discovered. forced sterilization. break their silence. i know. the international criminal court receives over. testimonies from. among others the taliban islamic state. watching international and a very warm welcome to you. children and teachers have marched through syria's

afrin in protest over the turkish military offensive with ankara trying to oust the kurds from the northern syrian region both sides appear to be looking to strike an unlikely alliance damascus is reportedly in talks to assist the kurds while turkey said it would welcome any effort by the syrian army to drive out what it calls terrorists from. explains. africa has turned into a bloodbath a grinding war that is claiming dozens if not hundreds of lives every day. turkish soldiers their rebel allies die in droves near

a thousand dead reportedly the kurds there why p.g.p. k.k. or p y d some estimates put their losses at over a thousand in a matter of weeks the turkish operation in africa isn't so much an advance as it is a meat grinder this is a senseless yet according to the belligerence necessary slaughter and it's hurting everyone we can cooperate with any side that lends us a helping hand in light of the barbaric crimes and the international silence there is a possible solution one that could stop this madness a man the least likely candidate of all. is that assad is clearly a terrorist and is carrying out state terrorism there is no peace in syria and it cannot be any peace with assad in power as the regime says we will hand over our

regions to the regions we will never run from over. that was then before the us led anti isis coalition began butchering each other now when everyone's dying and they need him i said isn't such a bad guy anymore. if the regime is entering that cleanse the petri cane. then there are new problems however if it comes in to defend why p.g.a. the nothing and nobody can stop us turkish soldiers simple if asaad took over african and african is syrian territory he could this some or sideline the y.p. ji ankara's enemy would be neutered and there'd be no more need to throw away turkish lives.