Tony Greer: Being Ready for the Chaos in the Markets
Tom welcomes back Tony Greer from the Morning Navigator to discuss the current markets and his outlook for the year. Tony expects further inflation, particularly from energy with the green transition. Markets are chaotic at the moment, much of which has to do with the yield curve – currently steeper than during the Great Financial Crisis and the Dot Com Bubble. It is important to watch what rates and the dollar are doing to understand how aggressive one can be with one’s trades.
He explains the bond markets’ impact on the rest of the financial markets, and the current inversion signalling of a recession ahead. He is bullish on oil and refineries, believing the downside on energy is limited and oil-related companies have good upside. Tony gives his thoughts on gold, natural gas and why we’ve had a pullback in price, and why he believes energy and natural resources will be the outperformers this year, while tech will move sideways or down. Technology had a huge rally over the past couple of years, so a correction was overdue.
0:00 – Introduction
0:40 – The Setup for 2023
7:45 – Yield Curve Importance
11:40 – Inflation & Commodities
13:20 – Energy & Risks
19:20 – WTI & Breakeven Price
21:24 – Dollar Trends
25:04 – Long Gold?
29:06 – Natural Gas Trends
34:25 – Carbon & Commodities
37:20 – Nuclear & Public Opinion
39:45 – Resource Companies
43:18 – Rates & Tech Sector
45:47 – CFTC & COT Reports
48:46 – Events & Bigger Themes
52:12 – Concluding Thoughts
Talking Points From This Episode
- The yield curve is currently inverted steeper than during past financial crises which could be a signal for a coming recession.
- Tony is bullish on oil and refineries and believes gold is a good risk mitigating investment this year.
- Why energy and natural resources will probably outperform this year.
- Tech sector is likely to churn sideways.
After graduating from Cornell University in 1990 Tony followed in his father’s footsteps to a Wall Street trading operation. He quickly learned his career path would be vastly different. He says, “I would not be sitting in the same seat on the same trading desk managing the same risk for the same firm for over 30 years.”
We have clearly entered a new era in financial markets.
He began in the treasury department of Sumitomo Bank on the 107th floor of the World Trade Center downtown Manhattan. Tony was an FX trading assistant while the Quantum Fund was breaking the Bank of England in 1992.
In 1993 he joined Union Bank of Switzerland as an FX and commodities trader, spending half a year as a Vice President in their Zurich treasury department. Then returned to New York City early in 1995 to join J. Aron & Company, the privately held commodity trading arm of Goldman Sachs.
He managed risk for the Goldman Sachs Commodities Index, in precious and base metals trading, and futures and options trading on the New York Mercantile Exchange.
He started his first venture in 2000 – Machine Trading which happened right before the tech bubble burst. That decision was his first excruciating life lesson in market timing. It turned out to be an extremely valuable learning experience.
He believes there is a massive opportunity with both the unprecedented situation in global markets and in the way financial news is consumed. In 2016, he started TG Macro, LLC.