GM02: The failure of the Dollar ft. Preston Pysh

Our guest for today’s episode is Preston Pysh, founder of BuffetsBooks.com and co-host at The Investors Podcast network. As a graduate of both West Point and John Hopkins, Preston is certainly the only person we have interviewed who has both an MBA but can also fly a helicopter. Mostly in the interview we were talking about economics rather than military strategy, but the topic of a US/China war did come up briefly. Preston has spent a lot of time thinking about value investing, and some of the most interesting parts of our discussion centred around the effects that money printing and technological change have had for the traditional value investor. But we also had a wide ranging chat about many other topics, including Moritz’s current favourite: Bitcoin.

Topics Discussed in this Episode

Value Investing

The correct discounting of future cash flows

Demographic changes

The debt cycle

QE

"I operate off this really fundamental thesis of manipulation: anytime somebody steps into a freely functioning system, like nature, for example, when man steps into nature and they start manipulating that, there is always a consequence of some sort that has to balance that manipulation out."

Berkshire Hathaway

The fundamental case for huge returns on Bitcoin

“To be quite honest with you I don't know how anything is going to outperform bitcoin based on my opinions of how I think it's going to perform in the coming year and a half. I don't know how anything can outperform that simply because the market cap is so low.”

Yield curve control

"The fixed income market is completely manipulated."

The failure of the dollar

" Every single thing on the planet has to be sold in order to come up with dollars to adjudicate the differences of the trades and the differences of opinions and the impairment that happened on the balance sheets."

The connection between Bonds & Bitcoin prices

Why countries should be doing their best to accumulate Bitcoin

Links

Catch up with Preston Pysh and learn more about his work:

The Investors Podcast

We Study Billionaires

Buffett's Books

Follow Niels, Moritz, & Rob on Twitter:

Niels Kaastrup-Larsen

Moritz Seibert

Rob Carver

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Full Transcript

The following is a full detailed transcript of this conversion. Subscribe to the podcast to get access to all of our transcripts as eBook downloads!

Preston

I wouldn't say that the value investing is dead, by any shape of the imagination. I think what you have happening is that because they're not supplying so much liquidity into the system, you have a different incentive structure that now exists than you used to have when it was just free and open markets and we would let businesses actually fail which doesn't seem to be a thing anymore.