Michael Kao (@Urbankaoboy) joins Julia La Roche on episode 119 to discuss his macro outlook, why we haven’t seen a hard landing yet thanks to the “four horsemen of economic resilience,” and why he’s favoring shorter duration assets in this economic environment.
Mike has been in the investment business for 30 years and has experience analyzing and investing in many markets and asset classes, spanning commodities to credit to convertible/capital structure/event arbitrage to distressed debt/equity investing.
Mike began his career in the commodities unit at J. Aron/Goldman Sachs in NYC in the early 90’s and traded over 25 different commodity markets and their derivatives. Mike left Goldman to pursue an MBA in Finance at The Wharton School.
After business school, Mike joined Canyon Partners, a credit-oriented hedge fund in Los Angeles, where he went on to become partner and co-founder of the Canyon Arbitrage Fund, which focused on various strategies including convertible and capital structure arbitrage as well as event-driven/risk arbitrage.
After 5 years at Canyon, Mike decided to leave Canyon and begin his own investment firm, Akanthos Capital Management, LLC. At Akanthos, Mike ran an opportunistic, value-driven investment strategy that looked for “fulcrum securities” up and down the capital structure.
Mike stopped actively managing external capital in 2019 and now invests primarily for his family office and enjoys blogging about the markets and economy on Substack at urbankaoboy.substack.com and Twitter @UrbanKaoboy.
Mike holds a BS in Electrical Engineering/Computer Science from UC, Berkeley and an MBA in Finance from The Wharton School of the University of Pennsylvania.
Links:
https://www.urbankaoboy.com/
https://twitter.com/UrbanKaoboy
0:00 Welcome Michael Kao
0:51 Macro view / The Four Horsemen of economic resilience
7:43 Recessionary outlook in the “vodka-Red bull” economy
11:00 The dollar wrecking ball
15:30 The rest of the world ‘out-doving’ the Fed
19:23 Oil outlook
26:27 Portfolio construction, favoring shorter duration
33:00 Thinking about stocks and bonds
35:00 Exit strategies
41:16 Parting thoughts
#067 Jeff Snider: Markets Are 'Screaming Bloody Murder' And Are Hedged For A 2008-Style Scenario
#066 Bethany McLean On The Rise Of Legal Fraud
#065 Mark Yusko: We Are On The Precipice Of The Global Financial Crisis II
#064 DoubleLine's Ken Shinoda On Macro, Housing, And The Opportunities In MBS
#063 Jonathan Boyar On Finding Value During Uncertain Times
#062 Jim Rickards: ‘Are You Kidding Me? This Is The Biggest Bailout In History’
#061 Willem Middelkoop On SVB Collapse, The Big Reset, And The Financial Endgame
#060 Tom Lee On Why Stocks Are Already In A New Uptrend
#059 Larry McDonald: We've Permanently Come Into A New Higher Interest Rate Regime And Trillions Are Currently Misallocated
#058 'Lunatic Farmer' Joel Salatin On The Only System That Can Ultimately Feed The World
#057 Milton Berg: How To Spot ‘Turning Points’ In The Markets
#056 Sam Burns On Being More Bullish On Equities In At Least A Year
#055 Jim Grant: Disinflation For The Short Run, Inflation For The Long Run
#054 Ted Oakley: A Long Way To A Normalized Investing Environment Post ‘Super Bubble’
#053 Michael Howell On How Liquidity Drives Markets And Where We're Likely Headed
#052 James Lavish: We're Walking A Very Thin Tightrope Over A Cliff
#051 Peter Boockvar On The 'Death By A Thousand Cuts' Economy
#050 Cullen Roche On Macro Outlook And Housing Risks
#049 You're Going To Be Working Until You're 85 Or 90 | Ric Edelman
#048 Carol Roth On How The Government And The Fed Created The Largest Wealth Transfer In History
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