Macro Dragon: What Makes a Great Consigliere?

Macro 2 minutes to read

Kay Van-Petersen

Global Macro Strategist

Summary:  Macro Dragon = Cross-Asset Daily Views that could cover anything from tactical positioning, to long-term thematic investments, key events & inflection points in the markets, all with the objective of consistent wealth creation overtime.


(These are solely the views & opinions of KVP, & do not constitute any trade or investment recommendations. By the time you synthesize this, things may have changed.)

Macro Dragon: What Makes a Great Consigliere? 

 

Top of Mind…

  • Boom! Gooooooooooooooood Morning from the Asia Pacific & Happy Macro Weds – a good evening-night to the Americas, MEA & Europe. Yes one of those extra positive & energetic mornings. This. Is. GOOD.

  • Do you know what the role is of a great consigliere?

  • Be they advisor, non-executive director, strategist, consultant or analyst…

  • Most people think it is coming up with new ideas, something fresh & different… preferably contrarian as well. Folks always want a different story, as they feel that something different has more edge… its this default notion that: More = Better… New = Edge

  • Could not disagree more…

  • …a great consigliere/advisor/strategist does at least two things very well…

  • ONE: They tell you what you need to listen to, regardless of whether you want to hear it

  • Yes, the epitome of a great advisor is someone who you pay to have perceived uncomfortable conversations with & potentially make perceived uncomfortable actions

  • This was sound cliché in a supposed world of ‘meritocracy’, ‘open dialogue’ & ‘flat structures’… yet the truth of the matter is the vast majority of us (+90%) surround ourselves explicitly (i.e. Trump, CEOs & most portfolio managers) or tacitly (More portfolio managers, CIOs, CEOs, Senior Executives, Managers, Leaders, ourselves & almost certainly everyone reading this) with people who we know won’t rock the boat.

  • People who we know tick the boxes of being part of Tribe Consensus - & most importantly people that do not stretch us in any way.

  • Even though we claim otherwise (“I want out of box thinkers & works…” “I want my views & ideas challenged…”), the force of the reversion to mean is strong & if you think about this… from an evolution's perspective this makes sense, we are wired to flow away from conflict &/or potential conflict… Because back in the Caveman / Serengeti days… conflict with one another likely meant violence, potentially death or even explosion.

  • Conformity to the Tribe, became the ultimate low risk pathway & paradoxically, a great way to “adapt”. In ‘wealth’ management (generally more like ‘wealth transfer management’, with investors for the most part paying a select few people for the privilege of under-performing on their assets) there is the icon adage of saying, “You can’t be fired for owning IBM”. And here you can paraphrase with anything in stead of IBM, say “Wharton”, “Harvard”, “MBA” or following the “CEO”, “Founder”, “Consensus”, etc.  

  • How many times have you heard, so & so is really smart & went to such & such school & fits right into the cookie cutter tray of our team – then folks wonder why they cannot break out of gravitational pool of Planet Average.

  • KVP used to ask people when they went down this tangent, “why do you think he/she is smart?”… genuinely curious, give us an example or two. And so far, it all ends up being societal window dressing. The thing about really smart people, is that its akin to coming across an athlete. No one has to tell you that an athlete is fit, they work out, they are built, they are slim, etc… you can almost instantly tell. No true self-respective athlete has to claim that they are an athlete. Just as no one truly smart, claims they are smart – in fact that could be an inverse signal right there (“stable genius”).

  • Where is the skin-in-the-game of so & so’s actions, thought process, versatility around live & epic events? Most of these muppets could not find their way out of an open bathroom…

  • Anyhow, we digress… back to point two…

  • TWO: They focus on the meta trends, the big moves & Goliath events… and they bang the drums on these (more rightly than wrongly over time) until everyone know’s their anthem

  • Point here being, they understand that its not about catching every potential wave… its just about catching a few big waves overtime… everything else is just noise. You don’t have epic daily memories when you replay your gifted bandwidth so far on planet earth, you have chunks of highlights around key events that tacitly or explicitly, have meaning to you

  • Point two is embedded in process & systems, not outcomes

  • Keep yesterday’s Dragon’s thoughts on Know Your Regime & a Phase One Deal Break Pathway on the Radar… they are not going to change anytime soon, especially the former…

  • Lastly we are not even hinting that KVP = Macro’s MVP… that would be akin to someone calling themselves “smart”, or KVP’s personal favorite calling themselves a “Hedge Fund Manager”… yet there is a reason we have banged the drums repeatedly this year with different intensity on US duration longs, oil shorts, credit longs, NOK & NO assets longs, USD shorts, gold & precious metal longs…  

  • Today: We have BoJ later on today, as well as inflation out of the UK alongside PPI & house prices. The US will see Empire State mfg, import prices, IP & capacity utilization. CA will likely take center stage with BoC. And of course the focus will continue on US earnings – remember how the Dragon was going on about US banks needing to write down bad loans? Well here we are in 2Q… Three US banks set aside record $28bn for loan losses

-

Start-to-End = Gratitude + Integrity + Vision + Tenacity. Process > Outcome. Sizing > Idea.

This is the way

KVP

Disclaimer

The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
Full disclaimer (https://www.home.saxo/legal/disclaimer/saxo-disclaimer)
Full disclaimer (https://www.home.saxo/legal/saxoselect-disclaimer/disclaimer)

All trading carries risk. Losses can exceed deposits on margin products. You should consider whether you understand how our products work and whether you can afford to take the high risk of losing your money. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. The KIDs can be accessed here or within the trading platform. Please note that the full prospectus can be obtained free of charge from Saxo Bank (Switzerland) ltd. or the issuer.

This website can be accessed worldwide however the information on the website is related to Saxo Bank (Switzerland) Ltd. All clients will directly engage with Saxo Bank (Switzerland) Ltd. and all client agreements will be entered into with Saxo Bank (Switzerland) Ltd. and thus governed by Swiss Law.

The content of this website represents marketing material and has not been notified or submitted to any supervisory authority.

If you contact Saxo Bank (Switzerland) Ltd. or visit this website, you acknowledge and agree that any data that you transmit to Saxo Bank (Switzerland) Ltd., either through this website, by telephone or by any other means of communication (e.g. e-mail), may be collected or recorded and transferred to other Saxo Bank Group companies or third parties in Switzerland or abroad and may be stored or otherwise processed by them or Saxo Bank (Switzerland) Ltd. You release Saxo Bank (Switzerland) Ltd. from its obligations under Swiss banking and securities dealer secrecies and, to the extent permitted by law, data protection laws as well as other laws and obligations to protect privacy. Saxo Bank (Switzerland) Ltd. has implemented appropriate technical and organizational measures to protect data from unauthorized processing and disclosure and applies appropriate safeguards to guarantee adequate protection of such data.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.