Steve Hanke is a professor of applied economics at the Johns Hopkins University and a senior fellow at the Cato Institute.
Over the last four decades, Hanke has been an advisor to world leaders and a leading voice on currency reform and hyperinflation. For a long time, Hanke has been an active trader of equities and commodities and was also the president of one of the world’s best performing mutual funds, Toronto Trust Argentina.
In this week’s episode of Opto Sessions, Hanke takes listeners on a fascinating journey through post-war politics and explores the current economic landscape in the wake of US president Joe Biden’s inauguration. He discusses how this all ties into global equity markets, while also providing some crucial tips on who to listen to.
Listen to the interview:
What is the top mistake investors make?
They read the press. About 95% of what's in the financial press is either wrong or irrelevant.
Where do you go for investment or economic insights?
My main general advice is to stick with quality people. This is about taking a little bit of the noise out of the picture … primary data is extremely important.
“My main general advice is to stick with quality people. This is about taking a little bit of the noise out of the picture … primary data is extremely important”
What's the most memorable moment from your career to date?
On the academic side, the day I was visiting at the University of California, Berkeley [when I] heard word that I'd been promoted to full professor at Johns Hopkins. On the trading side, I would have to say that the crude oil trade in 1986, Argentina in 1995 and the Russian ruble in 1998 — [those] would be big things.
What’s your top tip for your younger self?
Practice the five Ps: prior preparation prevents poor performance.
“Practice the five Ps: prior preparation prevents poor performance”
In your opinion, what is an investor's best source of alpha?
You've just got to be around quality people, who you can rely on. In my case, geopolitics is very important because all these markets are interconnected and they are international. You have to have great counsel on the geopolitical scene, and fortunately, I've got Mrs Hanke — I don't think anyone is in the same league as she happens to be in. It’s a very easy game for me and I don't have to work very hard. Plus, it's very enjoyable and most pleasurable to have discussions with her about geopolitics.
To hear more on Hanke’s macroeconomic outlook, and what he has to say about global equities, listen to the full Opto Sessions episode below.
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