This was very cool and thanks to all the people who reached out with words of support before and after the appearance. I was definitely a little nervous heading in. Thid was my first time on Bloomberg and I was lucky to be on one of my favorite financial TV shows – Tom Keene’s Surveillance. The segments are very fast and the show is done so professionally that it flies by, but I tried to get some big picture points in when I had a chance.
Here’s a short summary:
- Cyprus is a symptom of a much larger unworkable currency within Europe.
- The Euro crisis won’t end until the Europeans make some permanent changes to the foundation of the money system.
- As long as recession risk remains low you need to remain cyclically bullish about US equities.
- Europe’s risk/reward is far less favorable given the erratic behavior of many Euro stock markets.
- The key to understanding the difference between the USA and Europe has been understanding the deleveraging cycle and the dramatic impact that the decline in net investment had while the private sector pays down debt.
- Understanding the recovery in household debt has been key to the improvement in private investment and the slow crawling recovery that has been all about incremental improvement
- Unfortunately, I didn’t get too much into MR and some of the monetary stuff. Not that you’d want that anyhow….
Scarlet Fu also picked up on my “poverty effect” piece here. She discusses the big declines in some European markets despite all the intervention from the ECB:
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.
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