Top Podcasts of the Week

Below is our “Top Podcast” episode with our curator, Colby Donovan!

Today we have an episode on how options in Korea could impact the U.S. market, a couple of great episodes on venture capital, and a fantastic episode on leadership with Jocko Willink.

  • ***Must Listen*** Odd Lots: How An Exotic Investment Product Sold In Korea Could Create Havoc In The U.S. Options Market. This is a fascinating episode on structured notes with Benn Eifert of QVR Advisors, an options and volatility focused firm, and I will give a heads up this is a very dense and sophisticated podcast. They begin with an overview of what a structured product is and why it is an attractive investment. Then they dive into how banks offset their exposure after they sell these notes to clients, which is difficult to do since the products are so complex. However, they have learned to find ways to migrate their hedging to the S&P 500 and, as a result, created a situation where activity by retail investors in these countries (Asia and Europe) can create some extreme moves in S&P 500 options and the S&P 500 itself. The episode does a great job explaining how selling a product to retail investors in a place like Korea can then lead to potential systematic risks for the U.S. stock market. [January 20, 2020–51 minutesiTunes Podcast | Spotify | Overcast | Breaker | Website Link
  • Alpha Exchange: Andy Redleaf, Principal, Park Financial Group. This is a dense conversation about risk, capital structure, future growth and expected future returns with someone who has a really interesting background. The guest, Andy Redleaf, is principal of Park Financial Group, a firm finding opportunities to prudently lend in today’s climate of highly bifurcated credit allocation, who also previously started two hedge funds. The start of the episode is around his first hedge fund, which focused on capital structure arbitrage and exploiting differences in debt and equity of the same company. Then at 26:30, he talks about why he believes future expectations will be muted, why his base case for the U.S. is Japan over the past 30 years, and thinks it is most likely we will have low future returns instead of big busts. Then at 39:15, he talks about why he believes low rates are bad for the economy and cause a “reverse wealth effect.” They finish the episode at 43:35 with the three things that caused him to buy a bank: 1) ability to borrow close to treasury rates at short end of the curve, 2) an extended forbearance period in the event of insolvency and 3) access to the payment system. [January 14, 2020–53 minutesiTunes Podcast | Spotify | Overcast | Breaker | Website Link
  • MacroVoices: #202 Grant Williams: Civil unrest around the world. Failing Unicorns. All paths lead to gold. This episode begins with a market update from both hosts, discussing rates, oil, and the U.S. market. Then, at 12:45 they get into their feature interview with Grant Williams, who is a portfolio and strategy advisor to Vulpes Investment Management in Singapore and also one of the founders of Real Vision Television. Williams talks about the problems he sees with the social fabric of the world, which he thinks is the single biggest worry for 2020. The host, Erik Townsend, says he thinks runaway inflation will be the end game for the economy, but he has begun to realize the economic and market implications of that won’t be as big as the social and geopolitical implications. At 38:50, they highlight issues with some private unicorns and why WeWork marked a shift in the psyche of investors to some of these companies with high valuations and no profits. His last five minutes on the podcast (55:30–60:40) are spent discussing gold — why he was bullish before the recent run-up, and why he thinks the path of least resistance is still up. [January 16, 2020–1 hour, 26 minutesiTunes Podcast | Spotify | Overcast | Breaker | Website Link
Venture Capital & Start-Ups
  • Recode Decode: Kirsten Green: The four types of startups. Great episode on venture capital from the point-of-view of someone investing in companies through the lens of consumer and brand trends, and many of the brand and consumer ideas can be applied to a variety of businesses. Forerunner Ventures founder Kirsten Green talks about the rationale behind her investments in companies like Dollar Shave Club and Glossier. She believes people now want to be part of ideas, connect with brands, and create a deeper connection with companies and most of her investments fit this description. She also touches on culture struggles with companies as they grow from a couple of people to a huge staff, where innovation is coming from today, and why she believes her team’s diversity of thought is an advantage in today’s VC landscape. [January 20, 2020–1 hour, 10 minutesiTunes Podcast | Spotify | Overcast | Breaker | Website Link
  • The Twenty Minute VC: Khosla Ventures Founding Partner, Samir Kaul. Kaul is a Founding Partner and Managing Director at Khosla Ventures, a VC firm with a portfolio including Square, Affirm, DoorDash, Impossible Foods and OpenDoor. In this episode, he discusses what he’s learned from seeing the boom/bust cycle occur twice, handling follow-on investments and why he believes pro-rate is a cop out, why he loves to take on technological risk (hiring more engineers for a fixed price and doing R&D for set number of years) and not market risk, how his firm determines which portfolio companies to allocate time to, and what led him to invest in Impossible Foods. [January 13, 2020–37 minutesiTunes Podcast | Spotify | Overcast | Breaker | Website Link
  • The Meb Faber Show: #198 — Rabi Gupta and Satwick Saxena — EvaBot Is…A Gifting Assistant…It Makes It Easy For Businesses to Send Gifts. This is another episode in Meb’s “Founder Series” — interviews with entrepreneurs about starting their company, from new start-ups to unicorns. Gupta and Saxena are co-founders of EvaBot, a company founded in 2016 that puts a new spin on gift giving by harnessing technology to deliver personalized gifts tailored to recipient preferences. The company helps companies give gifts to clients and customers that are more meaningful — not just a generic box of chocolate that’s meaningless. They discuss the process of building the company the last few years, including how they came up with the idea, how they tested it over time, and how they iterated to their current model. [January 22, 2020–53 minutesiTunes Podcast | Spotify | Overcast | Breaker | Website Link
The Rest
  • ***Must Listen*** Impact Theory with Tom Bilyeu: #153 Jocko Willink on Respect, Influence and Leadership. Jocko is a Retired Navy Seal, leadership expert and author of the best-seller Extreme Ownership: How U.S. Navy SEALs Lead and Win. He is always a must-listen on leadership and provides his leadership principles and how to apply them. He also talks about why a leader needs to build trust and develop relationships with people both up and down the chain of command, why leaders need to understand human nature, and why leaders need to control their ego and emotions. [January 7, 2020–52 minutesiTunes Podcast Spotify | Overcast | Breaker | Website Link

Samir Kaul (Founding Partner, Khosla Ventures):

  1. The Power of Now: A Guide to Spiritual Enlightenment by Eckhart Tolle — talks about living in the present and not thinking about the fast and future. It also talks about meditating, thinking about yourself and exercising more.
  2. Start Something That Matters by Blake Mycoskie — The author is the founder of Tom’s. The guy didn’t want to start a big enterprise; he just wanted to make shoes after seeing it be done in Argentina. Contrary to everyone he talked to, he said for every shoe he sells, he was going to give one away, and everyone thought that was the dumbest business idea and it turned out to be the best business idea. Start something that matters — if you start a mission you can create a movement.

Safi Bahcall (Physicist and biotech entrepreneur, author of Loonshots: How to Nurture the Crazy Ideas That Win Wars, Cure Diseases and Transform Industries):

  1. Lindbergh by A. Scott Berg — There hasn’t been a hero like Lindbergh in over a century. When he made the trip over the Atlantic, people wouldn’t even take bets on his life because it was so unlikely he would make it flying solo across the Atlantic. When he came back, a third of the population came out to see him. He was more popular than FDR, FDR felt threatened, and orchestrated a campaign against him.
  2. Open: An Autobiography by Andre Agassi — One of the best sports biographies. It had a lot of drama because he had a huge hatred and love of the sport, and how he meets Steffi Graf is an incredible love story.
  3. How Life Imitates Chess: Making the Right Moves, from the Board to the Boardroom by Garry Kasparov — He breaks down what it was about how he approached the game that helped him because the longest reigning chess champion in history.

Good investing,
Meb Faber