This is the shortened link to the interview with Raoul Pal on Jesse Felder’s series of Superinvestors and the Art of Worldly Wisdom. It’s a podcast recorded about two months ago and rated highly by Charles Newsome, deputy chairman of the STA. We’ve nudged members towards it recently in the STA’s LinkedIn site, but just in case the nudge didn’t work, the blog might do the trick. In fact, you may perhaps not even have to listen to the hour-long discussion, satisfied by this quick summary. I would urge you to tune in though, as he’s good.
Essentials: Raoul Pal admits he was lucky getting into the world of finance in 1990. A job seeker during the recession, with an unspectacular degree from a second tier UK university meant he was ineligible for most graduate training schemes at banks. He hitched a ride at Dow Jones Telerate, at the technical analysis end of the spectrum with Teletrack, and learnt charts.
These remain at the very core of his methodology because ‘they show you everything, everywhere’. He then went on to teach traders what he had learnt becoming a specialist in equity derivatives and a prop trader via stockbroker James Capel, Nat West Bank, and Goldman Sachs.
He credits this competitive advantage at the early part of his career as key, and explains that this opportunity is probably no longer open to many today. In fact he believes the investment industry is currently in decline, caused by the demographics of ageing baby-boomers. Because of these very same reasons today he favours investing in Iran, and India which is at the centre of important trade routes.
So many things he says ring a bell with me, including the one where I told my daughter to avoid banking – though her university friend was determined and is making a good stab of things at a wealth manager today – because it is an industry in decline. The way he describes global macro thinking as ‘a three dimensional ever moving puzzle’ and ‘a beautiful intellectual pursuit’, about ‘looking for extremes reverting to mean’. Also how he is a very visual person, a cynic who is comfortable being short, who questions the narrative and does the homework.
A man after my own heart!
You can follow him on Twitter @RaoulGMI. Other people you might also like to follow are: @ttmygh (Things that make you go hmmm) authored by Grant Williams, and the ever US-biased www.zerohedge.com.