Erik Townsend: What We Have Now Isn’t Capitalism

from Wall St from Main St Jason Burack of Wall St for Main St had on first time guest, Erik Townsend. Erik is a former software entrepreneur who is now a hedge fund manager. He also hosts the new Macro Voices podcast http://www.macrovoices.com/ Listeners may also remember Erik from the past being on both the Peak Prosperity podcasts with Chris Martenson and also the Financial Sense Newshour with Jim Puplava. During this 40+ minute interview, Jason starts off the interview by asking Erik about his background. Erik talks about how he built a successful technology company and then sold it before the technology bubble popped. Erik then, unfortunately, lost a lot of his money after trusting Wall Street with his money. He then started to learn about investing on his own and how to manage his money himself. Jason and Eric talk about some of the problems with Wall St and the hedge fund industry. Next, Jason asks Erik if he thinks central banks are trapped? Erik thinks all the major central banks like the US, Japan, ECB, etc are trapped but predicting the timing of any collapse or market crash is almost impossible. He cautions people to avoid making big bets on the stock market crashing in the short term. Jason then asks Erik about what financial repression is and how people can protect themselves from it? Erik gives an excellent explanation of financial repression and how savers and investors, who have tried to do the right thing financially in their lives, are being penalized. Jason and Erik discuss how negative interest rates and a cashless society are following financial repression. Jason then asks Erik about the shale oil boom and what that has done to his peak oil thesis? Erik talks about how easy money and credit from the Federal Reserve allowed any oil driller with a pulse to get $$ to drill uneconomic oil wells. Erik expects oil to go lower again to the low to mid 30s before putting in a full bottom and he thinks there will be excellent investing opportunities for value investors if that does happen. Jason then asks Erik why he thinks the stock market hasn’t crashed yet? Erik thinks lots of money are coming into the US because they think the US Dollar will remain stronger than other fiat currencies. After this, Jason asks Erik about robots and automation and how entrepreneurs and younger adults will have to adapt to finding new jobs or creating new businesses in the economy. Erik says how crony capitalism is making things exponentially more difficult for the economy to create more jobs. Finally, to wrap up the interview, Jason asks Erik which countries or markets does he see value? Erik is looking for another correction in oil but thinks there will be excellent buying opportunities for investors if that does happen.

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