In this engaging podcast, Howard Marks, co-founder of Oaktree Capital, and Guy Spier, founder of Aquamarine Capital, share invaluable investment wisdom with Roi Lipovetzky, a former MBA student and current investment professional at Oakmont Capital.

The conversation explores key principles of successful investing, such as mastering market cycles, second-level thinking, risk management, and the importance of long-term, contrarian positions. Howard reflects on his experience through major market events, while Guy emphasizes the need for emotional discipline and unconventional thinking.

A key theme in their discussion is the importance of being true to oneself, especially in a world that often values conformity. Both Howard and Guy highlight the value of making independent decisions and staying grounded in one’s own principles, rather than trying to please others or follow popular trends.

With years of collective experience, Howard and Guy provide deep insights into the mindset needed for lasting success in investing and life.

Full transcript available here: https://aqfd.docsend.com/view/2nv2iqixj8rm7bb7

Contents:

(00:00) A Journey of Learning: Insights from Howard Marks, Guy Spier an Roi Lipovetzky

(03:20) Focusing on Excellence: Howard Marks on Building Oaktree for the Long Term

(07:19) Writing for Investors, Not for Entertainment

(18:09) Honesty, Risk and Purpose

(27:23) The Value of Fun: Howard Marks on Enjoyment, Work, and Investing

(33:38) Risk, Resilience, and Staying True to Your Principles

(41:12) Closing Reflections: The Power of Truth and Clarity

In this gripping segment, Eric Schaanning and Guy Spier delve into the complex world of interest rate risk, revealing how seemingly straightforward banking practices can quickly turn into high-stakes dilemmas. Schaanning breaks down how banks forecast deposit behaviours, merging historical trends with expert judgment. He explains that as interest rates fluctuate, customer preferences shift dramatically—rising rates lure them into term deposits for better returns, while declining rates send them back to the safety of site deposits.

But the intrigue doesn’t stop there. The duo uncovers the hidden layers of behavioural modelling in assessing credit risk, identifying subtle signals that may indicate a customer’s financial distress. Changes in spending habits and payment timing can serve as critical warning signs, shedding light on the delicate balance banks must maintain to safeguard their portfolios. Spier interjects with essential advice for individuals grappling with financial strain, emphasizing the power of communication and proactive payment management.

As the conversation reaches its climax, Schaanning reveals a shocking twist: a seemingly lucrative fixed-rate loan could morph into a devastating loss due to unexpected interest rate spikes. With banks grappling to adapt in an ever-shifting economic landscape, the stakes are higher than ever. This tantalizing cliffhanger sets the stage for their next discussion, where risk management strategies and survival tactics will be put to the test in the face of looming financial uncertainties.

Full transcript available here: https://aqfd.docsend.com/view/jtbtn9zjhaebq9eh

Here's a link to the presentation: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=5007032

Contents:

(00:00:00) Why banking Regulations Matter: A Dinner Table Explanation

(00:08:50) Calculating Net Interest Income with a Simple Example

(00:14:22) Fixed vs. Floating Rate Loans: Cash Flow Dynamics

(00:22:19) Balance Sheet Management: Shifting Between Income and Capital

(00:29:47) Interest Rate Swaps and Market Liquidity

(00:37:57) Exploring Risk Measurement and Gap Profiles in Banking

(00:40:52) Navigating Liquidity Risk and Redemption Dynamics in Investment Funds

(00:48:24) Understanding Interest Rate Risk and Behavioural Modelling in Banking

In this episode, we continue our exploration of financial risk management with Eric Schaanning, a thought leader in the field. Following his dynamic insights from the previous discussion, Eric delves into the intricacies of treasury functions within major banks and their critical role in risk management. Together with Guy Spier, they unravel how a small treasury team, despite its size, manages significant financial risks compared to the larger pool of relationship managers.

Listeners will gain a clear understanding of complex concepts like yield curves and risk spreads, as Eric adeptly explains their implications in today's banking landscape. The duo examines the Basel Committee on Banking Supervision (BCBS) scenarios for interest rate shocks, pondering whether current banking models can adequately address extreme interest rate fluctuations.

As they venture into discussions on net interest income (NII) and the economic value of equity (EVE), Eric shares his expertise on how these concepts can be applied to personal finance, making the conversation relevant for individuals navigating their own financial landscapes. With an engaging blend of practical knowledge and theoretical insight, this episode offers valuable perspectives that push the boundaries of traditional risk management. Tune in for another captivating dialogue that not only expands your understanding of financial systems but also equips you with practical tools for managing your financial future!

Full transcript available here: https://aqfd.docsend.com/view/dyu45ikdqvarwf5p

Here's a link to the presentation: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=5007032

Contents:

(00:00:00) Navigating Interest Rate Risks: A Deep Dive into Bank Balance Sheets

(00:08:57) Measuring Interest Rate Risk: Insights into NII, EVE, and Bank Profitability

(00:17:09) Banking on Transparency: The Impact of Regulatory Frameworks opn Financial Institutions

(00:31:18) Gap Risk in Banking: Insights from the Delta EVE Measure and Silicon Valley Bank

(00:39:56) From Crisis to Regulation: The Evolution of Interest Rate Risk Management

(00:53:52) Balancing Act: Large Banks, Regulation, and Operational Challenges

(00:59:21) Bridging Capital and Growth: Perspectives on Modern Banking

(01:23:55) Treasury Functions Unveiled: The Backbone of Risk Management in Banking

(01:29:02) Understanding Interest Rate Shocks: A Comprehensive Look at the BCBC Scenarios