O que são ciclos econômicos? - Outspoken Market

Name: O que são ciclos econômicos? - Outspoken Market
Uploaded: 2020-02-12T21:50:53.000Z
Duration: 1 h 30 min 58 s

Introduction

In this section, the speaker introduces the topic of the lecture, which is about economic cycles. He explains why it is important to understand economic cycles and recommends a book for further reading.

Understanding Economic Cycles

The speaker explains that understanding economic cycles is important because it affects people's jobs and financial stability.

He recommends reading "The Origin of Wealth" by Eric Beinhocker to gain a better understanding of economics.

The speaker debunks the myth that economics is a zero-sum game where one person's wealth comes at the expense of another's poverty.

Definition of Economic Cycles

In this section, the speaker defines what an economic cycle is and explains its four stages.

What are Economic Cycles?

An economic cycle refers to periods of expansion and contraction in an economy.

There are four stages in an economic cycle - expansion, peak, contraction, and depression.

The most commonly used measure of an economic cycle is Gross Domestic Product (GDP).

Conclusion

In this section, the speaker concludes his lecture on economic cycles.

Key Takeaways

Understanding economic cycles is crucial for protecting one's job and financial stability.

An economic cycle consists of four stages - expansion, peak, contraction, and depression.

Reading "The Origin of Wealth" by Eric Beinhocker is recommended for gaining a better understanding of economics.

Understanding Economic Cycles

In this section, the speaker explains how the economy is influenced by micro factors and introduces the concept of economic cycles.

The Importance of Measuring Economic Cycles

The economy is influenced by various factors such as consumption, savings, and trade.

To measure the economy's performance, we need a unit of measurement, which is where economic cycles come in.

Economic cycles are like sine waves that move up and down over time.

By measuring these cycles, we can estimate how long they last and predict future trends.

The Current State of Economic Expansion

In this section, the speaker discusses the current state of economic expansion and why it's important to understand economic cycles.

Longest Period of Expansion in History

The US has been in a period of expansion since 2009, making it the longest period of expansion in history.

Brazil experienced a recession during Temer's presidency before starting to recover.

China has also been experiencing significant growth for several years.

Dangers of Predicting Crises

Trying to predict when an economic crisis will occur can be dangerous because it's difficult to know when or if it will happen.

Some people make predictions based on past trends or personal opinions rather than actual data.

It's better to focus on regular investments over time rather than trying to time the market.

Investing During Economic Cycles

In this section, the speaker provides advice on investing during different stages of economic cycles.

Regular Investments Over Time

Investing regularly over time can help mitigate risks associated with market fluctuations.

During periods of expansion, continue investing regularly as markets tend to rise over time.

During periods of contraction or recession, continue investing regularly as markets tend to recover over time.

It's important to focus on the long-term rather than trying to predict short-term market trends.

Understanding Economic Cycles

In this section, the speaker talks about economic cycles and how they affect the market. He explains that crises are inevitable and that people should not waste their time trying to predict them. Instead, they should focus on being productive and solving problems.

The Nature of Crises

Crises are inevitable in economic cycles.

People who have never experienced a crisis before may not understand what it is like to wake up to a -10% drop in the market.

No one can predict when a crisis will occur, so it is pointless to try.

People should focus on being productive and solving problems instead of wasting time trying to predict crises.

Keynesian Theory

There are two main theories about what causes economic cycles: Keynesian theory and classical theory.

John Maynard Keynes was a renowned economist who believed that people's expectations could become self-fulfilling prophecies during times of economic expansion or contraction.

During times of expansion, people become optimistic and start spending more money. This leads to increased demand for goods and services, which drives up prices and creates more jobs. However, if people start expecting a recession or crisis, they become more conservative with their spending habits. This can lead to decreased demand for goods and services, which can cause prices to fall and jobs to be lost.

The Role of Individuals in Economic Cycles

Everyone is an "economic agent" who plays a role in shaping the economy by making decisions about how they spend their money.

When people start expecting a crisis or recession, they become more conservative with their spending habits. This can lead to decreased demand for goods and services, which can cause prices to fall and jobs to be lost.

It is human nature to try to anticipate financial movements in order to avoid being caught off guard. However, this can sometimes become a self-fulfilling prophecy that leads to economic cycles.

Conclusion

People should focus on being productive and solving problems instead of wasting time trying to predict crises. Everyone plays a role in shaping the economy, so it is important for individuals to make decisions that are beneficial for themselves and society as a whole.

Understanding Economic Contractions and Expansions

In this section, the speaker explains how economic contractions and expansions work, and how they can present investment opportunities.

Economic Cycles

A contraction in demand leads to a slowdown in the economy, causing factories to reduce production and lay off workers.

This reduction in production leads to a decline in wealth creation, which eventually results in an economic contraction.

During periods of expansion, people become conservative as they try to predict when it will end. However, during contractions, people tend to be pessimistic and believe that it will last forever.

The speaker believes that contractions present investment opportunities for those who are knowledgeable about them. He compares his current knowledge of 2020 with his experience during the 2008 crisis.

Investment Opportunities

During contractions, people become more conservative and start looking for cheaper assets. However, companies with good fundamentals will eventually recover from the downturn.

The speaker advises investors to look for undervalued assets during contractions because they present an opportunity for growth when the market recovers.

The speaker emphasizes that a crisis is an opportunity for investment rather than something to be feared. He encourages listeners to invest in stocks or other assets that have good fundamentals but are currently undervalued.

Personal Finance

The speaker advises listeners to focus on long-term investments rather than short-term gains. He recommends buying stocks or other assets at low prices during a contraction so that you can sell them later at higher prices when the market recovers.

The speaker believes that a crisis is an opportunity to learn and grow. He encourages listeners to study more, learn new skills, and become more valuable to their employers so that they can avoid being laid off during a contraction.

The speaker advises listeners to focus on recurring purchases rather than one-time purchases. This will help them maintain their cash flow during a contraction when money may be tight.

Dealing with Job Loss During Economic Contractions

In this section, the speaker discusses how people can deal with job loss during economic contractions.

Job Loss

The speaker acknowledges that job loss is a possibility during economic contractions. He encourages listeners to prepare for this possibility by studying more, learning new skills, and becoming more valuable to their employers.

The speaker advises listeners to protect their jobs by being proactive and solving problems for their employers. He believes that those who are most useful will be the last ones to be laid off.

The speaker emphasizes that not everyone will survive during a contraction. He compares it to nature where not all animals survive. However, he believes that those who are prepared and have valuable skills will have a better chance of surviving.

Personal Finance

The speaker advises listeners to build up their savings so that they have enough money to cover their expenses in case they lose their jobs.

The speaker recommends creating multiple streams of income so that you are not reliant on just one source of income. This could include starting your own business or doing freelance work.

Finally, the speaker encourages listeners not to panic during economic contractions but to remain calm and focused. He believes that those who are prepared and have a plan will be able to weather the storm.

Introduction to Austrian Economics

In this section, the speaker introduces the concept of Austrian economics and explains how it differs from other economic schools of thought.

What is Austrian Economics?

The speaker introduces the concept of Austrian economics.

He explains that the theory emphasizes avoiding pessimism and maintaining a positive outlook on the economy.

The speaker notes that he will present an impartial view of different economic schools of thought, including Keynesian and Austrian economics.

He explains that governments often intervene in the economy through fiscal and monetary policies to correct perceived imbalances or stimulate growth.

The speaker notes that excessive government intervention can create distortions in supply and demand, leading to economic crises.

Government Intervention in the Economy

The speaker discusses how governments use policies such as changing interest rates or intervening in currency markets to influence economic outcomes.

He notes that there has been less government intervention in recent years compared to previous periods, but excessive intervention can still lead to market distortions.

The speaker explains that according to Austrian economics, government interventions can create imbalances in supply and demand which eventually lead to crises.

Causes of Economic Crises

The speaker compares the views of Keynesian and Austrian economists on what causes economic crises.

He notes that Keynesians believe market agents will eventually adjust their behavior during a crisis while Austrians argue that government interventions cause market distortions leading to crises.

The speaker argues that during a depression, expansionary policies such as printing money may be necessary to stimulate the economy.

He notes that excessive government intervention can lead to market distortions and crises, citing the 2008 financial crisis as an example.

Quantitative Easing and Negative Interest Rates

In this section, the speaker discusses quantitative easing and negative interest rates.

What is Quantitative Easing?

Quantitative easing is a way for the government to inject money into the economy by buying government bonds or corporate bonds.

The central bank buys these bonds to try to stimulate economic growth.

This has been happening for 11 years, but it's a phenomenon that nobody fully understands.

Negative Interest Rates

When you borrow money, you have to pay back more than you borrowed due to interest. If interest rates are high, people may not want to borrow money.

To combat this, some countries have implemented negative interest rates where borrowers are paid to take out loans.

Softbank is one of the companies taking advantage of negative interest rates by borrowing large sums of money at low or negative rates.

Despite all the money being injected into the economy through quantitative easing and low/negative interest rates, inflation remains low.

Where is All the Money Going?

Trillions of dollars have been printed through quantitative easing in various countries around the world.

The speaker suggests that much of this money may be going towards speculative investments like cryptocurrencies and stocks rather than productive investments in businesses and infrastructure.

Análise Fundamentalista

The speaker talks about how some sectors are distorted and how it is affecting the market. He also discusses the concept of negative interest rates.

Distorted Sectors

Some sectors have distorted multiples, such as earnings per share or book value per share.

It is unclear where the money from these sectors is going, possibly into real estate or startups.

The speaker suggests that this distortion may be due to the fourth industrial revolution and increased productivity.

Negative Interest Rates

Brazil has entered a period of negative real interest rates, where the interest rate minus inflation is negative.

Other countries, such as Switzerland and Denmark, have even lower interest rates.

This phenomenon is new and not well understood.

Clementino Kele Trade

The speaker discusses arbitrage opportunities in different countries based on differences in interest rates.

Arbitrage Opportunities

Differences in interest rates between countries can lead to arbitrage opportunities.

These opportunities can cause currency fluctuations and affect the value of a country's currency.

One strategy for taking advantage of these opportunities is called Clementino Kele Trade.

Conclusion

The speaker concludes by encouraging listeners to stay strong and continue solving problems despite the uncertain economic climate.

Staying Strong

The current economic climate is uncertain and constantly changing.

Despite this uncertainty, it's important to stay strong and continue being productive.

Understanding the Market Cycle

In this section, the speaker discusses how to understand market cycles and how they affect different types of stocks.

Market Cycles and Stock Types

During periods of expansion in the market, there is a natural demand for technology stocks, capital goods, and consumer goods.

However, if you compare the multiples of technology companies to those of banks or healthcare companies during these periods, you will see that technology stocks are overvalued.

Conversely, during periods of contraction or depression in the market, investors tend to seek out defensive stocks such as banks and insurance companies that pay good dividends.

This leads to a high demand for these stocks and an increase in their prices.

Investing in ETFs

One way to invest in the stock market is through Exchange Traded Funds (ETFs).

ETF investing allows you to buy a diversified portfolio of assets with one purchase.

If a tragedy occurs with one company within your ETF portfolio during a period of contraction or depression, it will be replaced by another company without affecting your overall investment value.

Investing in ETFs can help mitigate risk associated with investing directly into individual tech companies.

Conclusion

The speaker recommends that viewers send suggestions for future topics they would like him to cover.

The Man Who Sold the Market

In this section, the speaker mentions that they will soon be discussing "The Man Who Sold the Market" by a designer named Johnny Simmons. They have not yet created a summary of the book as there hasn't been anything particularly different or noteworthy in it so far.

Discussion of "The Man Who Sold the Market"

The speaker mentions that they will soon be discussing "The Man Who Sold the Market" by Johnny Simmons.

They have not yet created a summary of the book as there hasn't been anything particularly different or noteworthy in it so far.

The speaker says that they will share any interesting insights from the book during their live stream.

Conclusion and Farewell

In this section, the speaker concludes their discussion and bids farewell to their audience.

Final Remarks

The speaker concludes their discussion and thanks their audience for tuning in.

They mention that they will continue to discuss Johnny Simmons' biography in future live streams.

The speaker wishes everyone a good weekend and reminds them to take care.