Crescat Capital Quarterly Investor Letter Q4 2019
January 29, 2020
Dear Investors:
Download PDF Version Bear Market Looms The bear case for US stocks has never been stronger. The set-up looks like January of 2018 when we were similarly bearish yet the market kept screaming higher. Our views were strongly vindicated in February and over the course of that year. The speculative mania of 2019 was wholly unwarranted, not supported by macro …
Tavi Costa Talks with Jelly Donut Podcast
Tavi built Crescat’s macro model that identifies the current stage of the US economic cycle through a combination of 16 factors. His research has been featured multiple times in financial publications.
Tavi Costa Featured in Barrons
Tavi Costa says opportunity may be knocking for one sector that’s been down in the dumps for a while. Oil-service stocks “have never looked so cheap,” Costa said in a tweet.
Running Hot
Download PDF Version The highly probable and downright inevitable unwind of today’s trifecta of financial asset bubbles: stocks, corporate credit, and Treasury bonds may soon morph into brutal bear market. The end game is unstoppable in our view and approaching fast. The Fed is between a rock and a hard place. It has been printing money like it’s the depth …
The Impending End of A Mania
Read PDF Version An important ratio of commodity versus equity valuations just reached a fresh 50-year low resembling two prior significant cyclical US stock market peaks in 1972 and 2000. Macro Imbalances There is a laundry list of dangerous assets bubbles in the global financial markets today that have built up over a record long US economic expansion: Highest ever …
Kevin Smith Speaks With Silver Bullion TV
Kevin Smith joined SBTV for an update on the inversion of the yield curve, the looming threat from collateralized loan obligations and why silver will be gold on steroids in this bull market.
Crescat Capital Quarterly Investor Letter Q3 2019
October 17, 2019
Dear Investors:
Read PDF Version Outlook for US Stocks and the Economy A breadth of deteriorating indicators is signaling an inflection point for the US stock market and economy. The percentage of inversions in the US yield curve surged to over 70% last month. This level of upside-down term premium has always led to severe bear markets and recessions in the past. …
Kevin Smith on Real Vision | Trade Ideas
Is the 36-year-old currency peg between Hong Kong and the U.S. on the verge of collapse? Kevin Smith explains his short thesis on the Chinese Yuan and Hong Kong Dollar in his most recent Real Vision interview.
Tavi Costa Interviewed on Palisade Radio
Tavi sees the current business cycle as being almost over and is awaiting an overall downturn in equities. Yield curves are inverting in most countries, and in Canada, 90 percent are now inverted.
Necessary, Normal, and Inevitable
Read This Letter in PDF Form Dear Investors: Recessions become self-fulfilling prophesies late in an economic expansion at a point when people finally start believing and acting like one is imminent. It is particularly true when asset bubbles are present. A huge spike in concerns about the economy as measured by Google Trends analysis of the search word “recession” was …
Bloomberg Cites Crescat Among Top Performing Macro Fund in August
Several macro hedge funds are on track for a banner month in August as fears of slowing global growth and protracted trade tensions sparked a long-awaited resurgence of volatility in currency and credit markets.
MarketWatch Highlights Crescat’s Success With Yuan Short
The stock market has gotten off to a brutal start this month, with the S&P 500 index down about 5% since it started unraveling last Thursday.
Crescat’s Macro Trade Heating Up
Read This Letter in PDF Form Dear Investors: Crescat’s “macro trade of the century” has just heated up significantly in August. In just the first two and a half trading days of the month, the Crescat Global Macro fund is up an estimated net 15.6% net MTD while the S&P 500 is down approximately 4.9%. All three legs of our …
Crescat’s Gold Strategy Discussed in Kitco Article
An economic downturn is on its way and the best hedge against a major stock market sell-off is gold, silver, and mining stocks, which are all “widely under-owned” at the moment, said hedge fund Crescat Capital.
Crescat Launches New Gold Strategy
“Precious metals are one of the few pockets of this market offering tremendous value to hedge against extreme monetary policies, bursting asset bubbles, and record global leverage”
Crescat Capital Quarterly Investor Letter Q2 2019
July 23, 2019
Dear Investors:
Download This Letter in PDF Form We believe there is an opportunity to capitalize on a material downturn in the business cycle based on the composite of timing and imbalance indicators in Crescat’s 16-factor macro model. US Equity Markets The downturn could be particularly brutal for US stocks because we are record late in a fading economic expansion …
Tavi Costa Appears on the “Off The Chain” Podcast
In this conversation, Tavi and Anthony Pompliano discuss Bitcoin, cryptocurrencies, the current U.S. economic markets, China, precious metals, how central bankers handle recessions, and what Tavi thinks is most likely to occur in the macro world over the next few months.
Kevin Smith Appeared On The Contratian Investor Podcast
Kevin Smith of hedge fund firm Crescat Capital in Denver joins the podcast to discuss his views on China and other asset bubbles, which he considers ripe for implosion.
Kevin Smith Shares His Macro Views on TD Ameritrade Network
Kevin Smith shared his macro views on TD Ameritrade Network. “We are committed to our bearish positioning here given the huge number of macro signals that we have today pointing to a downturn.”
Tavi Costa Speaks With Silver Bullion TV
Tavi Costa joins us on SBTV and shocked us with a plethora of warning signs he has found from his research that the bubble economy has peaked and the next economic meltdown is nearing.
Tavi Costa Shares His Views With CNN
Something happened in the bond market last week that has occurred before five of the past six major market meltdowns.
On The Precipice
Read This Letter in PDF Form Dear Investors: The US stock market is retesting its all-time highs at record valuations yet again. We strongly believe it is poised to fail. The problem for bullish late-cycle momentum investors trying to play a breakout to new highs here is the oncoming freight train of deteriorating macro-economic conditions. US corporate profit growth, year-over-year, …
An Abundance of Macro Timing Signals
Read This Letter in PDF Form At Crescat, we remain steadfast in our net short US and global equities position in our hedge funds. We are driven by our macro fundamental modeling and themes. Three historically extreme macro imbalances in global financial markets today pose significant risks to investors at large today, including: Record US equity valuations; Historic global debt-to-GDP; …
Kevin Smith Discusses First Quarter GDP Report And Underlying Cracks Beneath The Surface
Kevin Smith discusses the first quarter GDP report and the underlying cracks beneath the surface with Oliver Renik from the TD Ameritrade Network.
Kevin Smith and Tavi Costa on Hidden Forces Podcast
Kevin Smith and Tavi Costa speak with Demetri Kofinas on the Hidden Forces podcast and discuss their case for why this market rally is different and how Crescat is positioned for the bear market.
Kevin Smith Interviewed on Real Vision
Kevin Smith, joins Real Vision for his first Trade Ideas interview to discuss his bearish bet on the stock market. He reviews a variety of valuation metrics, highlights the flashing red signals from his macro indicators, and discusses how to make the trade, in this interview with Jake Merl.
Tavi Costa Interviewed on Real Vision
Tavi Costa, makes his Real Vision debut in style — with a bullish trade idea on precious metals. He highlights why it’s finally time for gold to start outperforming, supports his thesis by examining a variety of macro indicators, and discusses how to play the current setup, in this interview with Jake Merl.
Kevin Smith and Tavi Costa on The Meb Faber Podcast
Kevin Smith and Tavi Costa discuss Crescat’s macro views on The Meb Faber Show.
Crescat Capital Quarterly Investor Letter Q1 2019
April 18, 2019
Dear Investors:
Download This Letter in PDF Form The year-to-date rally in global risk assets after the Fed flip appears to us to be a last gasp of speculative mania for the current economic cycle. In our view, three flawed narratives are driving late-cycle euphoria in financial markets today: “Central banks can always prevent a downturn in financial markets and …
April 2019 Macro Deck
Please see our latest macro presentation.
Russell 3000 To Silver Ratio Now Near Record Levels!
Russell 3000 to silver ratio now near record levels! Double top formation after a retest of peak tech bubble levels? Stunning how historically depressed a “high beta” safe haven asset is this late in the cycle. New Crescat video out: https://www.youtube.com/watch?v=zoDePDL2etE&t=2s
Market Sentiment Is Bullish As Hell On The Idea That ‘Central Banks Got Your Back’. But Do They Really?
Market sentiment is bullish as hell on the idea that ‘central banks got your back’. But do they really? Perhaps they have created the biggest debt and asset bubbles yet assuring that the business cycle is alive and well. Here is why we are net short: https://tdameritradenetwork.com/video/rB4AoWmoG5SBacr3VyQI5A
Kevin Smith Speaks With India Times About Macro Ideas For 2019
Markets do not tend to stop at the median; they tend to go from bubbles to bust and from greed to fear. We are looking at something like a 50% to 70% correction…
Kevin Smith Featured In Bloomberg Article Discussing William Barr Letter and Outlook on S&P 500
Bloomberg News editor Vildana Harjric reached out to Kevin Smith Sunday for his views on how attorney general William Barr’s latest letter on the Mueller report would likely affect S&P 500 futures that evening.
Blow Off Top For Bear Market Rally
March 23, 2019 Dear Investors: Thursday had the feel of a blow-off top for the bear market rally. We are near historic valuations for US stocks across at least eight fundamental measures and at a record late stage in the business cycle. Equity markets appear more stretched relative to underlying deteriorating fundamentals than ever. Micron this week was …
Not A Pretty Picture For Us Stocks Going Into Earnings Season
Not a pretty picture for US stocks going into earnings season.
Macro Trade of The Century
Dear Investors: At Crescat we remain positioned to capitalize on a downturn in the economic cycle. Global equity markets peaked in January 2018 while US markets peaked in September 2018. Crescat’s hedge funds were two of the world’s top performing funds in 2018 as a result of our bearish macro views and positioning last year. We are confident that was …
Bear Market Rally Looks Done
GDPNow (YoY) is signaling the worst US economic environment since 2015, the year of the China currency mini-devaluation, oil crash, and EM meltdown. The US stock market is levitating while many economic indicators are turning down. Bear market rally looks done.
US Household Gross Assets to Disposable Income
Just one way to visualize today’s asset bubbles only beginning to burst. MMT: The idea that such imbalances can be permanently sustained through money printing without business cycle downturns or inflation. An absurd idea. Not modern at all. Poised to fail as throughout history.
Global Macro Analyst Tavi Costa Interviewed on Bloomberg TV
Crescat’s Global Macro Analyst Tavi Costa discusses macro trade of the year on Bloomberg.
Bear Market Rally Sets Up Opportunity For Crescat Strategies
Dear Investors: There is indeed a business cycle and timing it ahead of key inflection points is key to successful long-term investing. Based on our analysis, we are heading into a bear market in 2019 that will coincide with the start of a global recession that will not be officially acknowledged until well after it began. For the following reasons, …
The S&P 500 is more over-bought today than the prior two bear market rallies based on the percent of stocks above the 50 DMA.
The S&P 500 is more over-bought today than the prior two bear market rallies based on the percent of stocks above the 50 DMA. Great setup for selling if one believes this is only the beginning of a bear market.
Global Macro Fund ranked #1 performer in Macro category for December and full-year 2018 by BarclayHedge
The Crescat Global Macro Fund was ranked #1 performer in Macro category for December and full-year 2018 by BarclayHedge
Strong 2018 for Crescat – Macro Opportunities Abound
Crescat Global Macro Fund and Crescat Long/Short fund delivered strong returns for both December and full year 2018 in a difficult market. Based on Bloomberg reporting, Crescat had the number 1 and 2 performing US hedge funds in December and the number 1 and 3 performing US hedge funds for 2018. We are pleased to announce the official performance for …
Crescat Global Macro Analyst Tavi Costa Quoted In Bloomberg Article
Tavi Costa shared his views about the Canadian economy.
Will $NFLX Ever Be Able To Monetize?
A major disconnect: The more cash $NFLX was projected to burn, the more its stock price went up for four years. Now, the company is raising prices, but costs are going up too. Will it ever be able to monetize or is this just a QE bubble stock destined to deflate?
This Is Not A Picture Of A Healthy Global Economy
Over 80% of all non-financial stocks in Canada lost money on a free cash flow basis in the last 12 months! Australia, US and Asian countries aren’t too far behind. This is not a picture of a healthy global economy.
Early Dip Buyers Could Be Getting Set Up For The Slaughter
S&P 500 lagging to the downside. Steepest, late-cycle plunge in the Citi Global Earnings Revision Index ever. Started from record valuations. The early dip buyers could be getting set up for the slaughter.
2 of World’s Top Funds in 2018 per Bloomberg
“As the dust settles on a troubled year for hedge funds, some managers escaped the wreckage and even thrived”, according to Bloomberg who recognized Crescat for its leading performance among hedge funds globally in 2018: https://www.bloomberg.com/news/articles/2019-01-04/hedge-funds-returning-20-show-all-is-not-lost-for-smart-money
Crescat Capital Quarterly Investor Letter Q4 2018
December 31, 2018
Dear Investors:
Download This Letter in PDF Form We are happy to report estimates for Crescat’s 2018 performance: Profit Attribution by Theme Investment Outlook Summary September 20, 2018 should mark the closing high for the S&P 500 to end the second longest bull market in US history. It should also mark the top of the “everything bubble”, a term coined …
Global Macro Fund Ranked #2 in Macro Category For October by BarclayHedge
The Crescat Global Macro Fund was ranked #2 in Macro category for October performance by BarclayHedge.
Crescat November Performance Update
December 12, 2018 Dear Fellow Investors, Performance and Profit Attribution In December through yesterday’s close, Crescat Global Macro Fund (CGMF) is up an estimated 5.9% month to date and 29.9% year to date and Crescat Long/Short Fund (CLSF) is up approximately 7.4% month to date and 20.6% net year to date. Through the same period, the S&P 500 is down ...
Kevin Smith on The Lance Roberts Show
Kevin Smith was a guest on the Lance Roberts Show and discussed our current positioning in the markets.
Crescat Capital Quarterly Investor Letter Q3 2018
November 16, 2018
Dear Investors:
October was a frightening month for investors around the world. From Hong Kong to New York, stock markets were slammed by a wave of fears about slowing growth, trade wars, and higher interest rates. The Nasdaq took the brunt of the damage. Stocks like Amazon and Netflix both lost around one-fifth of their value as the Nasdaq Composite …
Crescat Tops the Chart in October
Dear Fellow Investors, October was a frightening month for investors around the world. From Hong Kong to New York, stock markets were slammed by a wave of fears about slowing growth, trade wars, and higher interest rates. The Nasdaq took the brunt of the damage. Stocks like Amazon and Netflix both lost around one-fifth of their value as the Nasdaq …
Crescat Delivers Strong October Results
For the third time this year, Crescat Global Macro and Crescat Long/Short hedge funds were featured among Bloomberg’s monthly top U.S. hedge fund performers. See October’s Bloomberg Hedge Fund Brief. Year-to-date and long-term performance remain strong as our macroeconomic themes and proprietary models continue to uncover successful investment opportunities. © 2018 Crescat Capital LLC Case studies are included …
Crescat Capital Quarterly Investor Letter Q2 2018
September 15, 2018
Dear Investors:
Download Letter (PDF) Our three best macro ideas today are complementary plays on the unwinding of currency and financial asset bubbles at a likely peak of the global capital cycle, the most leveraged in history: Shorting US stocks at proven, historic-high valuations relative to underlying fundamentals with abundant catalysts for a near-term bear market leading to a US recession; Shorting ...