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All Epsilon Theory Content

All Epsilon Theory Content

 

Everything we have published at Epsilon Theory since 2013, an archive of more than 1,000 evergreen notes.

Financing the American Home

By Marc Rubinstein | May 18, 2021 | 3 Comments

As a non-American there are many things I don’t understand about America.

Most of all though, I don’t understand the most American of products: the 30-year fixed-rate fully prepayable mortgage.

ET Zeitgeist: Ransom Paid

By Ben Hunt | May 14, 2021 | 5 Comments

The Colonial Pipeline embarrassment will accelerate the US gov’t’s efforts to control and co-opt crypto.

Binance, Kraken, BitMEX … they’re all squarely in the wrathful gaze of the Eye of Sauron now.

Wage Inflation Isn’t Coming. It’s Already Here.

By Ben Hunt | May 12, 2021 | 37 Comments

Over the past four quarters, the United States has generated more wage inflation than at any point over the past 40 years.

This is not an anomaly. This is not a single quarter aberration. A wage-price inflation cycle is here.

I’m not predicting. I’m observing.

I’m Trying To Understand Hedonic Adjustments

By Brent Donnelly | May 10, 2021 | 13 Comments

A Honda Accord cost $12,000 in 1990 and it costs $25,000 now.

A Mustang was $9,000 and now it’s $27,000.

The BLS has new car prices close to unchanged over the past 30 years.

ET contributor Brent Donnelly tries to wrap his brain around hedonic adjustments to CPI.

ET Zeitgeist: Now Hiring

By Ben Hunt | May 7, 2021 | 9 Comments

Our weekly digest on what we’re working on …

Including this article from the WSJ: Millions Are Unemployed. Why Can’t Companies Find Workers?

I dunno, if only there were some mechanism by which companies could entice people to work for them. Weird.

ET Podcast #10 – In Praise of Bitcoin

By Ben Hunt | May 5, 2021 | 0 Comments

Bitcoin has been subverted by the neutering machine of Wall Street and the regulatory panopticon of the US Treasury Dept.

What remains is a constructed Narrative that exists in service to Wall Street and Washington rather than in resistance.

What Sort of Business is Investment Banking?

By Marc Rubinstein | May 4, 2021 | 5 Comments

What do investment banks do, and why are European investment banks so bad at doing it?

Great piece by new ET contributor Marc Rubinstein!

The Zeitgeist – April 30, 2021

By Ben Hunt | April 30, 2021 | 3 Comments

Here’s what we’re reading and working on this week at Epsilon Theory.

In Praise of Bitcoin

By Ben Hunt | April 28, 2021 | 62 Comments

What made Bitcoin special is nearly lost, and what remains is a false and constructed narrative that exists in service to Wall Street and Washington rather than in resistance.

The Bitcoin narrative must be renewed. And that will change everything.

Bitcoin Market Profile

By Brent Donnelly | April 28, 2021 | 4 Comments

ET contributor Brent Donnelly gives a crash course in Market Profile analysis and applies it to Bitcoin since the Coinbase IPO.

The Last Capitalist

By Harper Hunt | April 28, 2021 | 0 Comments

Jonathan Plotkin is a longtime ET reader and brilliant cartoonist. For years he’s been sending Ben illustrations inspired by our notes and we’ve been dying…

Eye

By Harper Hunt | April 27, 2021 | 0 Comments

Jonathan Plotkin is a longtime ET reader and brilliant cartoonist. For years he’s been sending Ben illustrations inspired by our notes and we’ve been dying…

Manheim Steamroller

By Rusty Guinn | April 26, 2021 | 16 Comments
Image of Wormwood, the father and slick car salesman from Matilda

When we talk about and plan for inflation in our businesses and portfolios, we are usually focused on direction and magnitude. We also usually abstract away from price volatility.

We shouldn’t.

ET Podcast #9 – Make, Protect, Teach

By Ben Hunt | April 22, 2021 | 3 Comments

How do we change the world? Not through corporations and political parties from the top-down, but through free-thinking citizens from the bottom-up. Not as an alienated flock, but as a cooperative pack. Not with abstractions and transactions, but with making, protecting and teaching.

Let’s gooooooo!

The Zeitgeist – April 19, 2021

By Ben Hunt | April 19, 2021 | 6 Comments

Here’s what we’re reading and working on this week at Epsilon Theory.

Mailbag: ET Forum Edition

By Ben Hunt | April 16, 2021 | 10 Comments

We are now more than 900 Pack members strong on the ET Forum, with more than 1,000 posts contributed by smart, clear-eyed, full-hearted people from all over the world and all walks of life. Like you.

Here, I’ll show you. Here is some of the best and most thoughtful content on the internet today.

Here is the Mailbag that we need.

Here is the Mailbag that we deserve.

What Do We Need To Be True?

By Rusty Guinn | April 6, 2021 | 44 Comments

Modeling Common Knowledge by analyzing Missionary statements and their reverberations works. Except when it doesn’t.

ET Podcast #8 – Leverage and Its Discontents

By Ben Hunt | April 2, 2021 | 3 Comments

Three blow-ups in three months: Archegos, Greensill, and Melvin Capital.

What do they have in common? Insane leverage employed to maximize private gain while socializing potential losses.

A Tiger Can’t Change Its Stripes

By Ben Hunt | March 30, 2021 | 32 Comments

What do you get when you give a Raccoon billions of dollars AND invisibility from regulators? Collusion and insider trading.

Hot and Cold

By Rusty Guinn | March 23, 2021 | 26 Comments

Most of us are under the impression that a protracted conflict within China will increase national unity. Not this time.