B (3:34)

Joining me now is Hunte Investments founder and best selling book author Alex Gurevich. Alex has a new book out of course. The first book everyone remembers is the Perfect Trade. The next book is called the Next Perfect Trade. We'll talk about that at the end of today's interview. But Alex, I want to jump in and start with your specialty which is fixed income. Boy, talk about a moment in fixed income markets where there's a lot of variant perceptions. Some people, people are saying look, with Jay Powell going out, Trump is gonna get his way. We're headed toward much lower interest rates. At the same time there's other people saying no, no, no, it's the opposite. Too low of a policy rate is going to ignite inflation fears. We could see a crash in the back end of the bond market. What's your take? How should we understand the fixed income market and the outlook for bonds?

D (4:26)

Eric, thank you for having me here. It's good to be back. And yes, let's start with the fixed income market because I think US Fixed income market lies at the and it responds to probably the most robust set of economic data, which is US Economic data. Though admittedly economic data in the US over the last few months has been quite confusing. Even like to think of the government shutdown which disrupted various economic statistics reports and made them very distorted and a lot of conflicting data. We could dig in at this a little more but just to look at the big picture, the data has been inconclusive. As for the fears that over easy policy by the Fed will crash the long end of the curve, I think it is legitimate to expect serious steepening of the yield curve at the beginning of every easing cycle. It's not for example, when people were giving an example, people were talking about how last year there was a bunch of easings but long dated yield didn't budge. That is actually not strange at all for someone who traded almost 30 years of fixed income markets like myself. I've seen this picture many times over starting from for example the years like 2001, 2002, when there were periods when the short term interest rates fell dramatically but the long term interest rates were sticky causing a steep yield curve. That's a somewhat normal picture. What happens, at least in my experience, that first scholar and interest rates go down and then long end is sticky. Then eventually when rates stay low for a while, people get excited about going out on the curve and picking up the carry. And that carry hogging if you wish, leads at some point to a very intense rally in the long end which is usually also overdone. Like it was in 2000, beginning of 2003 ended up in a sell off. It was overdone during Brexit in 2016. It of course overdone in 2020. All of those in hindsight overdone. So those overdone long den rallies come, but they come much later. So I don't think we're very different from that playbook so far just in terms of behavior of market itself. Now a separate thing is to discuss it. What is actually under the hood and how is this economic environment different?

B (6:48)

Alex, let's keep that thought going and dive a little bit deeper.

D (6:52)

There is a concern about the Fed being over easy and creating inflation with this administration. Now I'm probably fall on the side of not being too concerned about the effects of Fed policy. A different Fed constitution or different like slight hawkishness or dovishness of the Fed about. I'm not too concerned about this having a major impact. Why is that? So I really believe that the difference between hawkish and dovish Fed is at most 50 basis point range for a couple of meetings because eventually the data dictates one way or another. The reason there is a little bit of range of outcomes right now because this data is ambiguous if the data becomes unambiguous. For example, if we have inflation continuing to moderate and employment continuing to deteriorate, any fad hawkish or dovish will take rates down and eventually take them to zero until the situation rectifies. So the difference between dovish and hawkish Fed is really how quickly they get to inevitable policy, inevitable convergence of policy. Now of course you could argue that there is the history of the Fed operating under somewhat reasonable assumptions versus highly politicized Fed. I really cannot give you a full picture on this because we don't know if the Fed will be completely different. My intuition for now is that it won't be that different. That's the first thing I will start with. And the second thing is like what is really going to win inflationary or deflationary impulses on the economy right now.

B (8:32)

Alex, let's go ahead and dive into those economic drivers. Then as you say, we'll set the politics aside and talk about the fundamentals.

D (8:39)

So what really drives interest rates? Let's start with a very simple principle that the Fed has dual mandate, inflation and employment. And inflation, as we know, has been stickily high but not necessarily deteriorating. Even probably there are many signs of softening inflation and employment on the other hand, is softening, but not yet convincingly. There is no convincing down spiral. So we have that picture of somewhat push pull, both not very strong push pulls on either side. So that's what creates ambiguity. Now I have to confess I have a confirmation bias because for a couple of years now I've been pounding my fist on the table to say that this higher real interest rates will lead to eventual deterioration in employment. Because once you make money more expensive, the balance sheet balance sheets start shrinking and people are less incentivized to expand and employ people. That's just a normal process. So I was waiting for the cycle to happen. So as I'm seeing the cycle happening, I'm of course getting a confirmation. Yay, I told you so. The job market is deteriorating. However, it is not deteriorating awfully fast. I cannot really claim victory. There are many indications that show it still being relatively stable. Furthermore, there is a little bit of ambiguity. How much of it is AI? Now I fall into the camp that AI has not yet made a significant dent in the job market, but will in the long run. That's my view of the situation. I believe that AI will lead to tremendous deterioration of job opportunities. And again we can go into this deeper but very differently from any other past technology. In some aspects it will act similar to past technologies in technological advances, but in some areas it will act differently. So it's not a single one way how AI will affect it. So there will be areas in which AI will do which past technologies did, which just change the texture of the job market and inside and change the structure of certain economic activities, but without actually taking them away. In certain areas, AI will eliminate a whole categories of economic activities. And that interestingly might be headwind not just for employment, but for GDP as well. This is where I'm not sure, like everybody talks about explosive AI growth. And as a person who believes in singularity, of course I have to subscribe to long term explosive AI driven growth. It's hard not to subscribe to it. But I not necessarily see explosive AI driven growth in the short horizon.

B (11:25)

Alex, I want to ask you how you think about where AI fits into the economy and how it's going to play. Because some people say AI, you know, it's an interesting trend, but once they figure out how much the energy is going to cost, it'll probably fizzle out. I don't see it that way at all. I see AI as being a cold war, like arms race thing, where it's going to be so important from a military perspective that governments, particularly us, Russia and China, are going to recognize that whoever wins AI, AI was just like winning the space race in the 1960s was all about military dominance. Once you controlled space, you could drop nuclear warheads from space. On the other guy, I think AI is going to be that important. And I think that whether you like the fact that it's going to create an energy crisis, and I think it will, or not, it's going to happen because it's going to be a matter of national security. Am I just being a conspiracy theorist to say things like that, or do you think it's going to be that important?

D (12:24)

I would say I wholeheartedly agree with you. I think it's almost mathematically impossible to be otherwise. I think that we're already at a stage when being skeptic about AI role in the military developments is a thing of the past. There is really almost no room left for skepticism about what you're saying. It will almost inevitably will be an arms race. In terms of AI, what is interesting, I was even thinking, which is completely independently of what you just said specifically this morning, I was thinking about the impact of AI and military, and I was thinking that paradoxically, it will probably increase dramatically military budgets because of this AI paranoia. But on the other hand, it actually will decrease employment because eventually we're not going to need ground troops. I think we are outliving the age of ground troops or just generally military personnel. I think people pointing and shooting is very close to becoming a thing of the past. And actual human troops will be used more like mediators, peacekeepers, rather than as assault force, because it's moving much more to, I think, autonomous weapons. And autonomous weapons will not function without complicated AI. And there's just no way a human being can push buttons as quickly as AI can. So there will be no competition. You cannot have a human army fighting a robotic army. If anybody reads Murderboard Diaries, which is popular books these days, watches the show, they can see like humans cannot fight against bots. It's not gonna work. That's kinda so. But that's Kind of my view on the military. So I think it's almost unavoidable. And I think you touched on something which I think a lot about and also agree with you, is the energy crisis.

B (14:14)

Let's move into energy next then. Because these are so tightly related, I think that we're headed toward an energy crisis before AI hit the stage. With AI hitting the stage, I think AI is gonna become a really big deal. A lot of people, a lot of regular mom and pop Main street folks are gonna say, hey, this AI thing is using up too much of our energy. It's making our electric bills double in price. We gotta shut AI down. You know, we've had enough of it. We want our energy bills back. They were. And the US military is going to say no. We absolutely have to keep the emphasis on winning the AI race because it is an existential threat in the new world and we have to continue. I think it exacerbates an energy crisis that was already certain to happen. And I think that energy crisis is going to be a bigger political topic than the energy crisis of the 1970s. Do you agree with that? And if so, what's the outcome? And which energy sources do we need the most investment in? Where are the investment plays?

D (15:20)

First of all, I will say that like the actual structure of energy market, it's very hard to predict it. As a macro trader, you almost have to be a scientist, right? Or a futurist, because there is a political factor. For example, certain things like small thorium reactors, right? They might be. They're probably. We probably all know that they're feasible, but the adoption of them. There's various political aspects and problems of adoption of various types of energy could be an issue. However, there is a lot of scientific questions. We don't know what kind of energy sources will become most efficient or cheapest in the future, how quickly we're gonna be able to build energy efficiency of computation. So I do not know exact structure of what's gonna happen, but what I think is undeniable is that computer's growing. And okay, you could say I told you so. I have to say I have tons of witnesses. I've been pounding my fist on the table over that or probably about a decay long before I even knew anything about LLMs and ChatGPT. It was always in my head that when I look at the growth of compute, that eventually it would consume the vast share of energy of humanity. That was unavoidable now for decades. The only reason why it was not noticeable because COMPUTE was taking Very small portion of overall energy. But the way it was growing, it was very clear that the charts were undeniable. It would overwhel everything. And I think it is continuing to grow and it will overwhelm all other energy demands. There is no way, at least in my mind, technology, whether it's renewable sources or introducing more nuclear sources or even fusion, will be able to catch up with it. Because I know that you tend to be more skeptical of fusion than I am. But even in the most optimistic prognosis of introduction of fusion, even if you're the biggest fusion enthusiast, by the time you put fusion online and actually the actual capacities of fusion, I think the demand for compute will outrun it. And even with the most optimistic view of energy efficiency improvement of compute, still compute will grow faster than any of other stuff. I just don't see how and what would stop that. I think that trainers are off the rails. So energy will unavoidably become a bottleneck. What has been a conundrum for me, the question that you ask, how to invest in energy? For example, a couple of years ago I was reasonably constructive on oil. I was not long front oil contracts, but I was long deferred oil contracts. And for a while the trade worked okay because whatever the front end was flopping around, deferred oil was earning carry from backwardation and I was kind of able to sit on it. But last year it went all into downtrend and I just got out of oil. I had to wave a white flag there with oil. And my question is now, will oil even be meaningful in terms of powering the compute of the future? Does it even matter what the oil price is? I mean for now, obviously it does. But will with just other sorts of energy become so overwhelming that oil does not even matter now? Obviously an interesting place to look at has been uranium and it has been done doing very well. And I've been constructive on uranium mining and remains so. But then we can see like will that be, will that be efficient enough? Should we look at some other chemical elements or should we look at some other sources of energy? So overall the demand of energy will continue growing. That's for me, that is a given. For me it's very likely that energy will be the bottleneck for civilization, for the growth, for growth AI, I think this energy what we're going to run into, to me that's the most likely stumbling block for the next few decades. But last question, what kind of energies actually will be mining and will prove to be most profitable? I feel a Little bit out of depth because there is a lot of scientific questions there.

B (19:29)

It makes sense, Alex, and I couldn't agree with you more that the most important thing is going to be a thirst for energy and a shortage of energy. I see it as a competitive issue between nations and frankly this scares me a bit. But China is kicking ass. China is building more. They have more planned and under construction conventional light water reactor based nuclear plants already in the works than the entire US fleet of nuclear plants. They are doing more with, you mentioned thorium reactors earlier. They're doing more with molten salt and thorium reactors than anyone else. And they've advanced the technology that was developed at the Oak Ridge laboratory in the 1960s and taken it to the next level already. They've already announced a fleet of container ships to be powered by thorium reactors. They're doing on both the conventional and advanced nuclear more than anybody else. Meanwhile, they're building out wind and solar and every kind of imaginable power plant. And they're doing it at a pace that's not constrained by the, you know, in North America we have to have public hearings and consider the implications on the Native American tribes and so forth before we build anything. They don't follow those kind of rules. The government just says we're going to build and build like crazy and that's what they're doing. And I don't see how we're going to keep up in what I think is a race for who can build enough energy to power AI to create military dominance, which is what I think this race is really about.

D (21:10)

Yes, I would agree this is scary. The only thing I would say is that the history shows when a communist run country starts this kind of by decree build out of anything, it usually goes sideways. The history of the Soviet Union shows even if at the moment it is terrifying, but it's no less terrifying. Those build outs are terrifying. They just in the end sometimes for reasons which are very hard to predict, end up being pointless or useless or obsolete or dysfunctional. So I will not completely, I'm not completely certain that China will succeed at what they're doing and it will not be all a huge waste and end up in a huge, whatever failed state debacle. At least that's what the history would suggest is going to happen. But first of all, it could be different this time. And secondly, it is terrifying nonetheless because failed states can become dangerous as well. It's more like the arms race itself is terrifying. As you mentioned, this situation when there is such a counter position it is definitely something to really worry about. I don't know how to trade that, but it's definitely something to worry about

B (22:22)

going back to what types of energy and maybe things that we could trade. Let me run my thoughts on this past you and get your feedback. It seems to me like the AI crowd has already figured out that the right strategic long term answer is nuclear. And they're already doing a lot of investment on that. But I think what they're going to find out very quickly is although that is exactly the right long term solution, it takes longer and costs more to build than you bargained on. And particularly the takes longer part I think is going to become debilitating for the hyperscalers that are used to doing things on a much more immediate timeframe. It seems to me what's coming is there's going to be this moment of reckoning where everybody says, oh boy, we got to figure out at any cost what can we build quickly from available fuels that doesn't take as long as nuclear. And I think the answer is natural gas fired power plants. And I think that probably the biggest bottleneck is going to actually be the gas turbines, those great big turbine machines that are used to create the dual cycle gas turbine plants, the efficient gas fired electric generation things. There's like a six year lead time to order those. Somebody is going to have to massively ramp up production of those. And it seems to me that gas fired power plants as an interim solution until nuclear can be built is likely to be a really important investment play of the next decade. What do you think of that thesis?

D (23:55)

It makes a lot of sense for me especially because US definitely has some natural gas. So that is not probably, as you say, it's probably natural. Quantity of natural gas we could get is probably not going to be the first bottleneck. And it is also true, yes, nuclear plants have like a 10 year cycle right to put them online. I don't know if it is correct, but that's my impression. So there is definitely something like this might happen. The only thing that I would say that I think in this military cold war ramp up crisis situation, I think the way the current wind blows and with the current administration, I feel like US will have some flexibility to just declare with various whatever military production acts to clear some of the obstacles and make things happen much faster. If they're on the same page as those hyperscalers who are trying to do, then they could clear a lot of regulations out of the way. That's my impression. So things might go faster than they have in the past, even in terms of nuclear power. But that could also pertain to production of those turbines you're talking about.

B (25:02)

Well, I think that is already happening in nuclear power. And for anyone in the audience who's not aware, normally the Nuclear Regulatory Commission has been in charge of all things nuclear and frankly they're a bureaucratic organization that I think has done more to stand in the way of progress than to regulate it. Over the 50 or so years that they've been in business, the DOE, the Department of Energy is literally end running them and has introduced their own regulatory process to say if you want to bypass the NRC completely, you can go for a DOE approval maximum. I think right now they've just increased to 30 megawatts. Thermal Nuclear reactor energy can be prototyped in a DOE permit without NRC approval. So that's I think the first time in the history of the United States that a private sector company could apply for a taking a nuclear reactor critical. That means actually making nuclear energy from it without an NRC approval. You can get it from DOE now. And as I perceive this, it's basically some political infighting where DOE says we're not going to wait for the NRC to get its act together. We're going to provide the people who need it with an alternate path to get to nuclear energy. And already a bunch of companies have jumped on that. Now that doesn't allow you to build the gigawatt power plants that we need, but it does suggest that maybe we're on the path to getting there. And what I think is going to happen is we're going to realize it still takes years to get some of these new advanced reactor designs figured out and scaled up and ready to really build at scale. In the meantime, we need a whole bunch more natural gas. We got plenty of gas. It's not going to be a question of there not being enough gas. As I understand it now, it only takes about a year and a half to build a new natural gas fired power plant. Once you've secured the turbine, the turbine itself, there's something like a six year backlog to order those things. And that's where I think somebody's going to have to do some, as you say, wartime kind of thinking to dramatically upsize the capacity for building more natural gas fired power plants quickly. And I'm trying to figure out what the investment play is in order to get on top of that one.

D (27:23)

Yeah, definitely that would be an interesting play. But under this thesis, anything related to energy buildup where the nuclear natural gas could be a good play because both of them could work out right. Because you could argue that if energy demand will grow as far and as rapidly as we think, any marginal energy will be good, any marginal source of energy, any incremental energy will go up in price. That could be one argument. But another argument would be that certain energy sources will just go out of style and nobody will pay attention to them. Those are the two arguments I'm torn between. But definitely energy is an interesting sector. And whatever happens in energy, as I want to reiterate, I do think that will be the bottleneck.

B (28:11)

Let's move on to another sector. Which boy is really getting your attention if you are long precious metals. We've just seen a whipsaw in the precious metals markets. Well, it's a whipsaw in gold. It's more like knocked out and down for the count in silver and Bitco. What's going on with precious metals? Why? You know, a lot of people were saying that it was caused by Kevin Warsh's nomination. I don't believe that. I think it may have been a catalyst to bring about an overdue correction. But what do you think happens next here for precious metals and what caused what just happened?

D (28:45)

Well, yeah, first talking about the nomination, to me it is more likely as what you say, and that's what I wrote in my recent investor letter, that if you notice, denomination didn't really impact the dollar or the interest rates that much. Everything moved just a tiny bit, but there was no real big repricing. So clearly precious metals were repriced because there was some vulnerability there. And it's unsurprising given how huge and relentless was the rally in for example, silver, that some people were very long silver and then they had probably some trailing stops and which as people often do when you have a market in which you have huge gains, you don't want to quite give them up. So you put a trailing stop. But then when as trailing stops starting getting taken out, suddenly market starts gapping down and it has to clear at a level which is more like close to the long term trend. I do not honestly know if that signifies the end of the precious metal cycle. It's hard for me to say because silver run. I was constructive on silver for very long period of time, but it ran much further than my price targets. It reached my price targets in 2025 and went past them and went further and further. Like I did think that silver would get to 50, 60. I did not really have 115 penciled in for January 2026. Not that I said that it couldn't go there, but my conservative price targets were lower. To me the most interesting about precious metals is they have very long multi year cycles and they're not simultaneous. That is gold went much earlier than silver. And while gold was making new highs recently, it definitely slowed down compared to silver. And silver was dormant forever. And then silver took off and overtook gold. If you look at gold silver ratio, it went from extremely high to actually to the lower end of the range in January. Now platinum was sitting dormant for even longer. Platinum was basically sitting at like $901,000 forever. And then it took off in 2025 and started trying to raise to catch up to silver, but it's still way behind now. They all corrected but to me gold seems to be a flat lining. Silver is trying to decide. Platinum I think is still early in its cycle. Of course we can also go to palladium, which I'm working watching currently slightly less but also interesting metal. And it has to do like platinum. Palladium ratios have to do with of course EV adoption and like the industrial use. But platinum has pretty solid underlying other some store of value demand, some jewelry demand. So there are, it cannot be just attributed all to automobile industry usage. So I think it's very hard to pinpoint what moves precious metals on a given day. It's easier to just look at the charts and see what are the price ranges for them. And to me if you look at historical range, I see like well, silver might have done the full cycle. Gold has gone further than one would've expected and platinum has not yet gone very far.

B (32:03)

Alex, let's move on to Japan and the Japanese yen. What's your take of what's going on there?

D (32:09)

Well, that has been like. If you really think about global macro markets, the moves in Japan are probably away from the volatility in precious metals. Japan had probably the most movement, the most interesting movement and the interest rates rose dramatically in Japan with curve steepening. Who would have thought that some bonds yield in Japan will touch 4%? I think like a few years ago it would be completely unthinkable. And yen in Japan actually running persistent inflation and yen significantly weakening against dollar and even more so against other low yielding currencies. You could look like for example Yen weakening significantly against China against Swiss franc is probably the most dramatic currency pair. That trend has been relentless and it seemed like every single thing that happened in Japan on the political front reiterated this trend. Like the elections, the new Snap elections, the reiteration of the power of the current ruling party. All of this is like more spending, weaker yen, stronger stock market, higher interest rates. That seems to be the theme. I do think that we could be at an inflection point of this theme because now I think all of this is priced in. And also all of this is priced in. And also, besides the story, there's also location, location. We're seeing very high interest rates in Japan and extremely weak currency. Typically we develop market currencies. There is some sort of pendulum that eventually slows down and starts swinging in the other direction. And one of the things I started to think of about in particular recently is okay, we got strong stock market, very pro growth policy, and we have high bond yields. Why wouldn't people want to invest in Japan right now? And if people want to invest in Japan either by repatriating money to JGBs or to foreigners buying JGBs, or people trying to still get a piece of Nikkei as it keeps rallying and Japanese stock market investment, why wouldn't that eventually lead to stronger yen? And just over the last couple of days, that sentiment seems to have shifted in that direction. I still don't know if it's a long term tectonic shift or just a blip compared to the overall trend, but that is something for me, interesting to look at. And what is interesting for me is that in my first book, the Next Perfect Trade, I talked about certain perfect scenarios that occur sometimes. And one of the great trades of the past was in 2014 to be long dollar when dollar was very weak and long US bond market when the short term interest rates were low, but the curve was very steep. And we have this setup in Japan right now. We're having very steep yield curve and very steep yield curve, still low, very low real rates because of inflation, very low nominal rates in front of steep yield curve and very weak currency. And we kind of have the situation that if BOJ is not going to tighten, you just make money on the roll down of the long end of the curve. But if BoJ continues to tighten, eventually it will strengthen the currency and the long end of the curve will probably be fine anyway because the curve will just flatten. So I'm seeing the seeds of the really positive situation to be long currency. Maybe you should be long everything stock market there too. But I'm a little more ambiguous on stock market, but long currency and bonds in Japan.

B (35:47)

Alex, you just mentioned your first book written in 2015, the next perfect Trade. I want to come Back to that. That book got a lot of attention when it was first published. You talked about being a macro trader and really broke down what you did and how your process works, looking for dislocations in markets. Then in 2022, you wrote another book called the Trades of March, which was all about the COVID pandemic and the trades that you had to make in March of 2020 and what that process was like. You've got a new book out. You've gone back to the original title, which is it's not the same book. It's a new version of the Next Perfect trade. Why now for a sequel to your first book and what's it about?

D (36:30)

I want to go back to what always bothered me about strategy books. It's them. Survivorship bias. So when I wrote the book in 2015, which came out, I was reading, writing like 2014, 2015, it was a strategy book. It is a set of strategy principles. How I choose trades which are more likely to make money in the long run. How to make myself be a casino rather than a gambler. Basically turn the how to gain the edge in the market in my favor in the markets, regardless of whether my economic views are correct or wrong. So I was trying to focus on how not to figure out the economic outcomes, but how to structure winning trades which bring you positive expectations. So that was what my book was about. But by definition, this book arose from the fact that I had some success trading up to that point. And people who don't make any money. Generally it's much harder to get your people to read your book. But it had an element of looking back and just saying, well, that worked for me and hence I'm proposing it. So the question would have to remain with the readers whether the principles I laid out in this book would continue to work going forward. Do they actually have value? Or is it just a coincidence that those principles worked prior to the time the book was published? When I wrote the Trades of March about COVID trading, I referred to my first book a lot and how the principles lined up there popped up, but it was not in a systematic way. Obviously Covid was a very unusual environment and navigating was highly unusual situation. And I did talk about how I drew from the experience of previous crisis such as September 11 or global financial crisis, what I've learned and the mistakes I made back then and how I was what things I was able to do better in 2020 and what things came up again. But that was more of a feel of a trading diary. Now I went back and wanted to do a second edition of my first book because I wanted people to really be able to judge objectively how my principles did actually work out. That's one of the reason in trades of March, I published our internal trade chatter without reductions, so people could see all of us screw ups, all of us successful. So people could really be kind of in a cockpit with us and see the process. What I'm doing here, I want to put more like intellectual cockpit and say, okay, this is my text from 2015. This is what I said in 2015. And then I added notes from 2025 saying like, well, this did indeed work out correctly here. I was wrong, or this principle I've actually succeeded in applying in such and such situation. And this principle I failed to apply. And those are mistakes I actually made even according to my own strategy, which is probably the worst kind of mistake. The worst kind of mistakes, which you laid out your own strategic principles and then ended up not having the discipline to follow them. And I am totally open about the fact, and I think really every trader has to be open about the fact that it does happen to all of us. We all have our vulnerabilities, our moments of either stubbornness or confirmation, buyers or laziness or procrastination or fear or whatever it is that leads us being succumbing to external pressure, which leads us to deviate from what I think is the absolute best we can do. All we can strive is to be the closest we can to the best we can do. But none of us can do it perfectly. And I'm trying to really delineate in this book where and how you can notice both the successes and the flaws of my thinking of 2015. The ideas were quite current. I believe that artificial intelligence will step in to augment everything we do. But what I said back then, that there was a certain horizon, in my opinion, left for discretionary trading. If anything, I think the horizon shortened a bit because artificial intelligence grew even a little faster than I expected, even though I was always optimistic on artificial intelligence. But it went on schedule. And I'm giving this as an example to trace my thinking was my thinking with what happened afterwards? And was my trading aligned with my thinking? Those are two separate questions, but both of them are important.

B (41:08)

Alex, I really want to salute you for the honesty that you show and the approach that you take of highlighting your own mistakes. As you say, we all make them. There's nobody who's exempt from that. What's quite unusual though, is Wall street guys Admitting their mistakes publicly. So many people in this industry just highlight look at what I did here. I made this incredible winning trade. Hooray for me. Without acknowledging that their actual long term trading record is not nearly so good. So I really applaud you for taking this open book approach to doing things. People who are fascinated with this help us understand though, because this new book is really a rewrite or a new version of the original Next Perfect Trade. Does it make any sense at this point to read the first one? Should people start by reading the new edition of the Next Perfect Trade and then maybe the trades of March? Is there any reason at this point to read the 2015 book?

D (42:02)

No, I think people should read the current book because all the material which was in the first book book is still there. In fact, I mostly kept the wording of the first book even though I could have edited it more because I wanted people to read what I wrote back then. And I wanted to be very exact about this is what I was thinking back then. And then I have a note. This is what happened now. So I take everything, all the content, everything you can get from the first edition you can have in the second edition. So now it's a second edition of this book that is for sale on Amazon and that's what or in other venues and that's what I encourage people to purchase. But however, if you read the first book, you can still find a lot of value in reading the second edition.

B (42:45)

And the second edition is very reasonably priced at only 10 bucks on Kindle right now. I assume that's an introductory price. It looks like the normal price is 32 bucks and it's 10 bucks right now. How long does that last?

D (42:59)

I think Kindle will be there for a little bit. It's like $32. I think it's for card covers. I'm just asking people to give it a shot. And if you read it, please leave reviews on Amazon. It's very helpful and also generally helps me to know what people think about it.

B (43:14)

And of course Alex, when you're not writing books, you also run a very successful hedge fund for our accredited investor audience that's able to invest in hedge funds than our institutions. How do they get a tear sheet and more information about your fund?

D (43:29)

People who want to find out more either about my fund or about any other any of my writing or publicly available information should go to my website, Honteinv.com, it's H O N T E I N V.com there will be like publicly accessed areas with various articles and books are published and everything like that. And also for qualified purchases they could apply to get kind of insight and discuss investments, but that's not something that is open to general public.

B (44:03)

Well Alex, I can't thank you enough for a terrific interview. Patrick Suresna and I will be back as Macro Voices continues right here@macrovoices.com.

A (44:17)

Now back to your hosts Eric Townsend and Patrick Sergeant.

C (44:23)

Eric it was great to have Alex back on the show. Now listeners, you're going to find the download link for the post game Trade of the Week in your Research Roundup email. If you don't have a Research Roundup email, that means you have not yet registered@macrovoices.com just go to our homepage macrovoices.com and click on the red button over Alex's picture saying Looking for the downloads.

B (44:44)

Patrick after Alex Gurevich's comments on Japan, the Yen feels like it's sitting at the center of a cross currents right now. When you look at that setup, how are you thinking about positioning around the yen for the next several months?

C (44:57)

Eric Coming out of Alex's interview, Japan is starting to look less like a one way weekend forever trade and more like a macro inflection. Yields have risen and the curve has steepened, yet the yen remains extremely weak. When you pair higher yields with a cheap currency, you eventually get a pendulum swing as capital starts to flow back in and the currency can surprise on the upside. So for this week's Trade of the Week, I want to get long yen exposure without pretending we're picking the exact bottom. The setup is asymmetric. If the bank of Japan stays cautious, the market can still remain investable. But if tightening resumes and capital starts flowing back into Japan, the unwind of the yen funded positioning can drive a fast move higher. So here's the structure. The September 2026 yen future is trading at 6220. I'm looking at the 8-7-6 month 63 call priced at 37 pips, of which 32 pips is intrinsic value and a delta around 77 cents getting you a high delta participation. Each contract represents roughly US$80,000 of notional exposure and $4,625 premium outlay per contract buys you convexity and capped risk. If the yen breaks higher, you're participating meaningfully and if it rolls over, your risk is limited to the premium paid. It's a clean way to express a bullish yen view, positioning for a potential regime shift without taking open ended downside exposure.

B (46:36)

Patrick Every Monday at Big Picture Trading. Your webinar explains how retail investors can put on our most recent trade of the week. For those listeners that want to explore how to put on these trades in greater detail, don't miss on a 14 day free trial@bigpicturetrading.com now let's dive into the postgame chart deck.

C (46:55)

Eric, we got to talk about these equity markets. What's your thoughts here?

B (46:59)

No real change from last week, Patrick. We went from people starting to panic and thinking that the sky was falling to a fresh round of euphoria that maybe the software tech correction seems to be bouncing. Question is, are we going to see a Mag7 rally? But moving on to the big picture, my view is still that the stock bull market of the early 2000 and 20s is in its late stages if not winding down, while the commodities bull market of the late 2000s is still just in its infancy.

C (47:28)

Well Eric, a lot has happened on the S&P 500 in the last week. We were at the edge of a cliff last week attempted to break below the 50 day moving average and the bulls made a big save bringing the S&P 500 back in this January trade range. Now what we want to identify here is how things look under the hood. Now I want to look on page five here on the NASDAQ 100 and what you can see here is the Nasdaq broke below its 50 day moving average and on this recent rally the Nasdaq has failed to get back above that 50 day moving average. That's really being driven on the weakness in the software stocks we talked about last week. But what's interesting here is is that the semiconductors on page six continue to do very well. So we have this scenario where mag sevens and software inde continue to do very poorly but the semiconductors are back up to our 52 week highs and even the Cosby and other AI driven indices are actually making fresh new 52 week highs. Really in order for that S&P 500 to go higher, it really needs those Mag 7s to turn up. And if not, then this is going to be a very heavy market where rallies are going to be short lived and overhead resistance is going to be very difficult to beat. And so we're really watching to see or not that participation happens or whether the ceiling has been already formed on the markets. All right Eric, let's touch on the US Dollar here.

B (48:58)

Well, last week I said the bounce on the Dixie looked impressive but I questioned whether it would roll back over, maybe even moving down to new lower lows after the market realized that WARSH wouldn't be as hawkish as Fed chair as the market feared. The rally clearly has stalled, but we haven't really rolled over to new lower lows either. We're about a 50% retra. So this could still go either way. My outlook is still bearish on the Dixie, but I also want to acknowledge that we're fighting a multi year support level at 95 or so. And so we could easily consolidate here for weeks to months before the next directional move is clear.

C (49:35)

Well, Eric, I'm keeping the dollar very simple here. We had a rally attempt, it rejected at Fibonacci zones and below the 50 day. So the prevailing downtrend remains the path of least resistance. The price action's very weak, but we're at a very important level on dollar index at this, this 9650 level because if we break below it, then the downside window really opens and we could see a level down toward 95 or 94 on the dollar index at this point, there's no sign of a trend reversal and no sign of any bulls ready to take the dollar higher. So at this stage we want to respect that prevailing downtrend. All right, Eric, let's touch on crude here.

B (50:14)

Well, Patrick, I guess I'd put it to say crude oil seems to be firming up, but it's not racing toward a big upside breakout either. I continue to see a war in this market. At least that's my perception of what's driving it. The intermediate to long term fundamentals are definitely bullish. We're seeing that in the time spreads as well. But in the short term, few things are more important to President Trump than keeping energy prices low through the midterm elections. And whether you like him or hate him, it's pretty darn clear that he's willing to take extreme measures in order to get his way. So I just question whether or not there's a risk around an outright long on the flat price of oil if, if President Trump potentially is gonna make a deal with somebody in order to suppress the price through the elections. Meanwhile, the time spreads continue to strengthen into modest backwardation. And that's still the trade that I favor. And as our longtime listeners know, that's the trade that I've had on for several months now, which is long the CLZ6Z7 time spread.

C (51:14)

Well, my only observation here is that the price action remains surprisingly accumulative. Every time there's a dip, it's bought and we Continue to hold well above the 50 day, moving aver and at multi month highs. At this stage, price action has established a new bull trend and there isn't a lot of narratives around this bull thesis, which is would mean that it would surprise a lot of investors if it broke out here at this stage. I want to respect this short term bull trend and looking for upside back to the highs that were established in 2025. All right, Eric, let's talk about gold.

B (51:53)

Patrick. The main thought on my mind this week is, well, it ain't over till it's over. We're back above the 50% Fib retrace level at 5024 on the April contract. That's definitely positive. But this rally has stalled Here right around 5100 a few times now. Seems like we're fighting some pretty strong resistance there. And that's still well below the 61.8 fib retrace level which is at 51.66. And to be sure, after a panic of the magnitude that we saw last, a dead cat bounce trading up to the 61.8% Fibonacci retracement level. That's 5,166. 5,166 on the April contract. If we were to hit that level then roll over in order to retest, let's say first the 50% level, that's 5,024. And then going down to 4,882 which is the 38.2% level, that would be a perfectly textbook failed dead cat bounce type of a situation. So to my thinking, it ain't till it's over. Now, if we got a solid daily and then weekly close above 5,166 and stayed there for a week, that's what would sound the all clear and say, okay, the bottom is probably in for this correction, but unless we get that move above 5,166, absent that signal, I think we're probably gonna consolidate for weeks to months in the 4,500 to 5,000 range. So we'll have to see how this plays out. Ultimately though, I'm still definitely bullish. This market. I don't think the bull market is over.

C (53:27)

Yeah, well, my position is very simple. After such an extraordinary bull run and such a steep correction at this stage, the name of the game is going to be consolidation. I think that first quarter of the year now is going to be gold. Just absorbing this volatility and really establishing a new fair value zone. It's very reasonable to assume that the 50 day moving average and the low that was put in last week down near 4, 500 could be the low end of the range. We've seen previous gold consolidations that the first low that is established is the one that ends up being the lowest level gold traded. So if this pattern persists then we should see that act as a major support. But it's very likely here that these short term rallies in gold are likely to be faded and that we're going to be far more range bound. And maybe only after several months of consolidation does it set up for maybe bull continuation later in the year. All right, Eric, let's touch on uranium here.

B (54:28)

Patrick, I'm still uber bullish in the long term and this swing trade, or correction, whatever you want to call it, that we've just had cleared out the overbought technicals and has set the stage for a new move higher on the daily chart. Now the one hesitation I have about that is the stochastics are still a bit high on the weekly chart and still pointed down. So maybe this isn't over quite yet. But the extreme overbought condition on both daily and weekly charts has been negated by the correction and the daily chart at least is set up for a new bull move higher. I remain uber bullish intermediate to long term, but I'm not sure whether or not the market is done shaking out the weak hands. If the precious metals roll over in particular, a contagion will ensue, not because there's any reason for it to. Other than that a lot of the same people own both precious metals and uranium. If they were to get shaken out of their long precious metals positions, particularly if we get a really big deeper lower situation in precious metals, that's going to cause margin calls that will cause people to be forced to sell what they can, not what they want to. And that means they'll be selling their uranium. So that's definitely a structural risk. Other than that and you know, really extreme events like a major nuclear accident, I just couldn't be more bullish. This, this uranium market question is, is the turbulence over yet? I'm not quite sure.

C (55:55)

As steep of a drop as uranium was, it came right to the 50 day moving average right to the retracement zones and it's bounced off those levels. So at this stage the bulls actually are still in command of this trend and I'm going to give the bulls the benefit of doubt that they're going to be able to to turn this and drive uranium prices still higher. From here. Just to wrap things up, Eric, I wanted to just touch on copper. Bottom line is copper has consolidated but all pullbacks have actually held along the 50 day moving average at this stage. Copper had a great run. It's just like gold and silver. We could very well see consolidation prevail here on the short term. Basically, I'm not looking for another big upside rip here, but rather at the same time I'm not overly bearish. So I think the story for the remainder of the first quarter of the year on so many of these is just going to be consolidation and backfilling and establishing new fair value zones. And I think that's a very safe way for many of our listeners to be thinking about the prices here.

B (56:57)

Patrick, before we wrap up this week's show, let's hit that 10 year treasury note chart.

C (57:02)

That 10 year treasury yield we had the first reasonably big move of the year. Things have been very quiet through December and January at this moment. The big question here is are we going to see a re resumption of yields declining after spending basically 3, 4 months with yields coming off the 4% level back to about 430, we're now seeing that trend reverse back down. Will we see see yields back at 4% at this stage? I wouldn't surprise me. And so watching to see whether bonds get spicy here folks, if you enjoy

B (57:39)

Patrick's chart decks, you can get them every single day of the week with a free trial of big picture trading. The details are on the last pages of the slide deck or just go to bigpicturetrading.com Patrick, tell them what they can expect to find in this week's Research Roundup.

C (57:53)

Well, in this week's Research Roundup you're going to find the transcript for today's interview as well as the Trade of the week chart book we just discussed here in the post game, including a number of links to articles that we found interesting. You'll find this link and so much more in this week's Research Roundup. That does it for this week's episode. We appreciate all the feedback and support we get from our listeners and we're always looking for suggestions on how we can make the program even better. Now for those of our listeners that write or blog about the markets and we like to share that content with our listeners, send us an email@researchroundup.com and we will consider it for our weekly distribution. If you have not already, follow our main account on X Acro Voices for all the most recent updates and releases, you can Also follow Eric on xrichstownsen. That's Eric Spelt with a K. You can also follow me at Patrick Ceresna on behalf of Eric Townsend myself, thank you all for listening and we'll see you all next week.

A (59:00)

That concludes this edition of Macro Voices. Be sure to tune in each week to hear feature interviews with the brightest minds in finance and macroeconomics. Macro Voices is made possible by sponsorship from BigPicture Trading.com the Internet's premier source of online education for traders. Please visit bigpicturetrading.com for more information. Please register your free account@macrovoices.com Once registered, you'll receive our free weekly Research Roundup email containing links to supporting documents from our featured guests and the very best free financial content our volunteer research team could find on the Internet each week. You'll also gain access to our free listener discussion forums and research library. And the more registered users we have, the more we'll be able to recruit high profile feature interview guests for future programs. So please register your free account today@macrovoices.com if you haven't already. You can subscribe to Macrovoices on itunes to have Macro Voices automatically delivered to your mobile device each week, free of charge. You can email questions for the program to mailbagrovoices.com and we'll answer your questions on the air from time to time in our Mailbag segment, Macro Voices is presented for informational and entertainment purposes only. The information presented on Macro Voices should not be construed as investment advice. Always consult a licensed investment professional before making investment decisions. The views and opinions expressed on Macro Voice Voice Voices are those of the participants and do not necessarily reflect those of the show's hosts or sponsors. Macro Voices, its producers, sponsors and hosts Eric Townsend and Patrick Ceresna, shall not be liable for losses resulting from investment decisions based on information or viewpoints presented on Macro Voices. Macro Voices is made possible by sponsorship from BigPicture Trading.com and and by funding from Fourth Turning Capital Management, LLC. For more information, visit macrovoices.com.