The roundabout path to profits: Mark Spitznagel on the Dao of Capital How a hedge fund manager with floor trader roots embraces the Q Ratio, Austrian economics, mark spitznagel bitcoin hedging, libertarianism and Daoism to prepare for the next market crash. Mark Spitznagel is an accomplished trader and hedge fund manager who has learned to take advantage of market distortions he blames on an overly involved Federal Reserve and government, while preparing for the consequences of those distortions. He does it through the study of Austrian economics and the application of the roundabout method of investing.
Instead, he takes you on a tour of history and nature that illuminates these long held truths. He travels a long way to come to a pretty simple message. It is through his vast research and study that he shows that this message, though simple, is essential. He has documented how it has been so throughout history. Futures Magazine: Your book cites some of the most accomplished economists, military and historical figures as inspiration but at the top of your list is an old grain trader and family friend Everett Klipp.
Mark Spitznagel: He was a close family friend, very close to my dad. But when I was 14 I thought that’s what trading was. This is the discipline of trading, loving to lose and nothing about winning. I immersed myself in it and became obsessed with the grain markets. Through high school and even through college, I wanted to be a corn trader. I clerked for many summers in the grain and ultimately the bond .
It slowly became obvious that is where someone’s got to be. Daniel Collins is a 25-year veteran of the futures industry having worked on the trading floors of both the Chicago Board of Trade and Chicago Mercantile Exchange. Dan joined Futures magazine in 2001, before the name change to Modern Trader, and in 2005 he was promoted to Managing Editor, responsible for overseeing all the content that went into Futures and futuresmag. Every further new high in the price of Bitcoin brings ever more claims that it is destined to become the preeminent safe haven investment of the modern age — the new gold. But there’s no getting around the fact that Bitcoin is essentially a speculative investment in a new technology, specifically the blockchain.
Think of the blockchain, very basically, as layers of independent electronic security that encapsulate a cryptocurrency and keep it frozen in time and space — like layers of amber around a fly. It’s the amber that determines their value, not the flies. Cryptocurrencies are a very significant value-added technological innovation that calls directly into question the government monopoly over money. All local governments had to do was make it illegal to hide, and thus force law-abiding citizens to become criminals if they fail to disclose such accounts.