hi everybody tune in to this short version of the podcast which we do every Friday for the long version tune in on Wednesdays.

hi everybody I'm Nicola tangan the CEO of the Norwegian Sovereign wealth fund and today I'm here with Stan Ren Miller a proper legend in the investment World Stan what a pleasure to be here happy to see you niai.

now what are the most important data you're looking at these days currently yeah.

interestingly enough I'm known as a macro investor but I do our macro from the bottom up so we're listening primarily to companies.

and we're not seeing any material signs of weakness other than maybe in the housing market but that's from a very elevated price level.

so we're not seeing bottom up in information indicating to us that there's an economic problem anytime in the next 3 to 6 months.

I would also say I'm revealing now that I'm more of a market animal than an economist that we look at Financial conditions.

they've been very very loose I mean there is looser looser than they were when the FED actually started tightening.

they've tightened considerably in the last four or five weeks ever since the ironically ever since the FED cut because the dollar has rallied and obviously interest rates have gone up.

how big a problem is the budget deficit.

as a practitioner it's something I can't be obsessed with on a 3 to six month basis.

as an American it's something I'm really obsessed with because debt to GDP can't go up forever.

and to me we have a reckoning but I don't know how the time when that's going to take place.

I will say that because the reserve currency we've been permitted to engage in behavior that say the Brits couldn't have behaved in.

there's a new term I have getting LZ trust we haven't been L trust because we are the reserve currency even though if you look at everything we're doing it's much more radical than the Brits were doing yeah.

um what's that old saying how do you go bankrupt slowly and then suddenly.

running deficits with full employment at basically at 7% of GDP is a recipe that can't last forever.

one of the reasons we haven't paid for it is in Co the entire private sector 80% of individuals refinance their mortgages.

so the average mortgage rate is still under 4% even though at the margin it got to 8%.

corporations termed out their debt that stuff rolls over in 25 and 26.

if we're going to have a problem it's probably more like late 25 early 26 but you just don't know.

so how do you think the Tech sector will develop what kind of science are you seeing there the AI boom is going unabated niai.

what he said that you look at honestly uh I've got young really good analysts here yeah a lot of people have a lot of young analysts who are who are on top of things.

and they started um we noticed about three or four years ago that the kids that go to Stanford and MIT the engineers were shifting from crypto to I that was the first signed.

then my my young Partners started talking more and more about AI uh I asked them how to play it they mentioned a company called Nvidia which I thought was a gaming company I hadn't done work on in a long time.

um I bought a pretty good chunk of it and then like a month later chaty PT happened.

it was just total luck I had no idea chy PT but the AI drum around here was big enough and the stock was down I think from 400 to 150 or something.

so that's how I got started in it once we invest in something like that then we really start to dig deeper and then there was a whole chain of things.

when we last met you mentioned the concept of buy first analyze later tell me about that.

yeah Soros used to call it invest and invest and then investigate.

I think I just gave a classic example I didn't know that much about Nvidia I just knew that Ai and I had some people here tell me how to play it.

so we bought Nvidia and then we we were in the process of doing a lot more work and then chat GPT happened.

but I've always had the view that markets are smart they're fast and they're getting much more so with with all the communication and the technology we have today.

and that if I hear a concept and I like it uh if I wait and spend two or three months analyzing it I may miss big part of the move and then psychologically be paralyzed.

it's hard to buy a stock you're looking at at 100 it's 160 even if it's going to 400 somehow your your head is screwed up and you're waiting for the pullback.

so we will we will buy something a meaningful position but not Earth shaking and then really do the work.

and if I think we made a mistake I'll sell it and if I don't think we made a mistake will add to it if if we have to yeah.

no I I I happen to have worked exactly the same way uh in my life it it really focuses in your your work and your efforts and your thinking but have you always believed in your own pattern recognition.

yes when I started in the business I got promoted too early.

so before I had really learned the nuts and bols of the analysis to the extent that I should have I was promoted to to a to a leadership position and I had to rely a lot on charts and I had to rely a lot on intuition.

what I learned from Soros is when you have conviction you should bet really big.

I know your listeners have probably heard it before but I but probably the best illustration is the pound yeah.

so what happen so let's go back so you are in the office what's happening in the UK.

the day I believe was September 15th that I would remember um.

I read the financial times and the head of the bunis bank now I'm sh I'm AG but I'm pretty sure it was te Meer has written an editorial in the financial times.

basically in more proper language but he's basically saying that the deut mark and the pound should no longer be linked.

so I decide to take Duan and the quantum fund to 100% long the deark short the pound cuz it's still a half a%c unbelievably.

now you're going to hear vintage Soros so he happens to be in New York at the time which he wasn't always.

I go into his office and I explained to him why I'm going to 100%.

And he had a rather large personal account that's how we kept each other out of each other's hair he traded that and you know was 90 90 95% overlap.

told him why I was doing this and he had this um unpleasant puzzled look on his face when I'm telling him my thesis that this one economy is booming and they need higher rates this other economy is falling apart they need lower rates that these two currencies shouldn't be linked.

and I'm thinking what does he not understand about this cuz this guy pretty much understood everything.

and he says uh look this is uh this is a one-way bet they come along very very rarely it's ridiculous doing 100% we should put 200% of the fund in this trade.

so there you have it.

now you took um sabatical in 2000 yeah what was the reason behind that.

it's a it's a painful but really fun Story the fund is down like 17% and Duane is down 7 %.

and uh I'm just exhausted I've been running this high-profile fund for 12 years.

so I sell everything out everything of Duane send my investors a letter and say uh I'm going on a sabatical I don't know whether I'm coming back or not you can take all your money out but if you take your money out if I decide to come back I can't guarantee I'll let you back in.

I think I had like 200 their clients one of them pulled their money I remember who it was but they'll remain anous.