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Macro observations for the new year

In 2020, the world was uniformly “stress-tested”, providing a clear window in which to view and uncover global cause-and-effect relationships that would be otherwise difficult to uncover in more benign times. This was the year where lots of seemingly disparate pieces of knowledge over the years came together — leaving important lessons for millennials in 2021+.

Observation #1: Asset prices are set at the margin, supported by orderbook depth created by increasingly complex and heterogeneous investment rule sets

Observation #2: Monetary aggregates are important, but are only meaningful when assessed in conjunction with the underlying balance sheet plumbing, and velocity

Observation #3: Diversified investing is not about “60/40”, but rather about managing ‘time-dependent’ short vs long volatility strategies / exposures

Global Macro

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