Jaime Carrasco: Getting Ahead of Monetary System Destruction
Tom welcomes Jaime Carrasco of Canaccord Genuity back to the show. Jaime explains his strategy of hedging accordingly with 40% gold, 40% silver, and 20% blockchain. He believes blockchain technology will become increasingly important in building an alternative financial system.
Inflation is occurring globally, and while they claim it will only be transitory, money can’t be removed from today’s system as debt can only grow.
The system today is imploding and central banks are trying to keep things afloat. However, at an accounting level, things are a complete facade. Basel III is about the banks determining who has the physical gold behind all the paper promises. The ship is sinking, and their ability to control it depends on public perception.
A replacement system will have a new structure, so why not build it on the blockchain and bypass banks.
Today, most are still happy to be at the party on the financial Titanic. We don’t know when the bubbles will end but what is most important is where we are heading. Gold should be trading much higher than where it is today. If gold were rising, people would stop trusting the Fed and central banks. The benefit is that you can still get a cheap seat on the lifeboats.
Jaime points out that China has bought a lot of gold and had it converted to kilobars. So it will likely be up to China to call for the next currency reserve standard. As much as banks tell you that gold is unloved, they are, in fact, buying it.
Jaime discusses the hedonic adjustments used to calculate the CPI and promotes the Fed’s narrative. However, inflation is much higher than they are claiming and even using their flawed metrics, inflation is going much higher.
Jaime discusses the geopolitical risk with mining and what to look for in mining equities. He expects dividends from mining producers to skyrocket when gold and silver rise.
Chile is starting to rewrite its constitution, and he expects this process will be a good litmus test for South America. Chile had a massive debt contraction under Pinochet, and today they have a low debt to GDP.
Time Stamp References:
0:00 – Intro
0:34 – Hedging Accordingly
7:27 – Crypto & Central Banks
15:05 – Gold & Currency Reset
20:02 – Bubbles & Opportunity
23:42 – Currency Strength
26:47 – Gold & China
29:32 – Transitory Inflation?
36:00 – Picking Stocks
39:25 – Risks in Chile
45:37 – Concluding Thoughts
Talking Points From This Episode
- Safe haven hedging assets.
- Importance of blockchain in the coming financial world.
- CPI metrics and why inflation won’t be transitory.
- Resources, mining equities and geopolitical risk.
Jaime Carrasco is portfolio manager at Canaccord Genuity Inc. in Toronto. From 2014-2018 he worked as Director of Wealth Management and Associate Portfolio Manager for ScotiaMcLeod. Before this, he worked for Macquarie Group, CIBC Wood Gundy, BMO Nesbitt Burns, Gordon Capital, and Merrill Lynch.
Jaime is a leading Canadian investment professional with 25 years of experience providing wealth management and investment counsel to affluent families, businesses, and institutions. He has garnered a reputation for questioning and challenging the status quo and exploring the most innovative investment strategies.
Jaime, whose mother tongue is Spanish, also speaks Italian and French. He completed a BA in political science and economics at the University of Toronto in 1988. While a student, he worked for CS Yacht, a company that built luxury sailboats, thus spending his summers as a skipper for the Canadian establishment members. Jaime credits this experience and having survived sailing through Hurricane Bob in 1991. This experience taught him lessons that have become a metaphor for his financial investment strategies.
“Like one’s financial wealth, sailing is not about controlling the wind, but rather about adjusting the sails.”