This week we had the pleasure of welcoming Jeff Snider (Head of Global Investment Research at Alhambra Investments) and Emil Kalinowski (enterprising investor, author and host of both a talk radio show and a podcast). Together, they co-host Eurodollar University podcast and shed light on the complexities of the global monetary system. Our conversation included:

• Back to basics – how the global currency and monetary systems actually work
• The origins of the Eurodollar system
• Triffin’s Paradox and the breakdown of the Bretton Woods System
• Interest rate targeting as a form of mass psychosis for capital markets
• How banking reserves interact with the Eurodollar system
• Different types of money – commodity-backed, high-powered and credit
• Treasuries as the main form of balance sheet ballast for private investors
• A different take on the Great Financial Crisis – a stampede towards prime collateral at all costs
• Why central banks would compete to buy assets that are already scarce and in high demand
• The true impacts of quantitative easing and why it’s ineffective in reducing interest rates
• The importance of sentiment and why the main role of central banks is theatrical
• Lacking the tools to unclog the system
• How even China got caught in the ‘Eurodollar System Vortex’
• Vast swathes of the real economy have been deprived of credit since 2008
• REPO markets, unwilling primary dealers and backwards elasticity
• Rehypothecation of collateral and other fundamental problems
• Creation and intermediation of money should be done by separate institutions
• And much more

This is “ReSolve’s Riffs” – live on YouTube every Friday afternoon to debate the most relevant investment topics of the day, hosted by Adam Butler, Mike Philbrick and Rodrigo Gordillo of ReSolve Global* and Richard Laterman of ReSolve Asset Management Inc.

 

*ReSolve Global Inc. refers to ReSolve Asset Management SEZC (Cayman) which is registered with the Commodity Futures Trading Commission as a commodity trading advisor and commodity pool operator. This registration is administered through the National Futures Association (“NFA”). Further, ReSolve Global Inc. is a registered person with the Cayman Islands Monetary Authority.