Liberty and Finance, Released on 8/23/24

Tavi Costa from Crescat Capital discusses the current U.S. financial system’s challenges, particularly highlighting the unsustainable interest payments relative to GDP. Costa argues that the U.S. can no longer afford restrictive monetary policies and anticipates that the Federal Reserve will need to cut interest rates significantly, even if it results in rising inflation. He suggests that the U.S. dollar might weaken as a consequence, leading to increased investment in hard assets like gold, silver, and commodities, and potentially boosting emerging markets. Costa also reflects on historical trends, noting that the current debt dynamics resemble those faced by previous global powers and could signal substantial shifts in investment flows. Finally, he emphasizes the importance of preparing for these changes by focusing on undervalued sectors and hard assets, given their potential for significant long-term gains.

0:00 Intro
1:19 US interest payments to GDP
10:57 Stock market
14:10 Dow/gold ratio
17:15 Miners & silver
22:29 Inflation exceptions
27:52 Tavi Costa
30:24 Weekly specials

Tavi Costa is a partner and portfolio manager at Crescat Capital and has been with the firm since 2013. He built Crescat’s macro model that identifies the current stage of the US economic cycle through a combination of 16 factors. His research has been featured in financial publications such as Bloomberg, The Wall Street Journal, CCN, Financial Post, The Globe and Mail, Real Vision, Reuters. Tavi is a native of São Paulo, Brazil and is fluent in Portuguese, Spanish, and English. Before joining Crescat, he worked with the underwriting of financial products and in international business at Braservice, a large logistics company in Brazil. Tavi graduated cum laude from Lindenwood University in St. Louis with a B.A. degree in Business Administration with an emphasis in finance and a minor in Spanish. Tavi played NCAA Division 1 tennis for Liberty University.

  debt crisis, gold, investing, silver, stock market, tavi costa