Follow The Money!
Benny & The Squirrel: Ep. 48 - The Unmissable Sunday Show!
Show was recorded at 7.20pm EST on Sunday 3rd May, 2026. Make sure you join us on Thursday. We have Brent Donnelly coming on to chat about FX and his new book - Alpha Trader 2.
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Episode Slide Deck
Pod Summary
Ags and ‘Oh Canada’ Update
The agricultural commodities sleeve has been the primary driver of 🐿️returns during the broader period of de-grossing
M&A activity in Canadian Mining and Energy has also been a positive contributor. Upside: 30% bid premiums; downside: need to find new trades!
BUSHY™’s Current Portfolio Positioning
35% in cash and hedges; ~6% gold; ~15% ag commodities (the performance driver); ~15% trend followers; some EM local currency bonds; ~22% equities
Benchmark: Vanguard 2035 Target Date Fund (classic 60/40 global mix)
Five peer ETFs tracked: Cambria’s Trinity, Bridgewater’s All Weather Fund, 3Fourteen’s Real Asset Allocation, Bobby Elliott’s HFND, and Evoke’s RPAR
Bridgewater All Weather: heavily positioned in bonds, TIPS, bond futures, and cash — very defensive
Bobby Elliott’s HFND: ~47% in cash — “prepping for World War Three”
Meb Faber / Cambria: global diversifier; described as Rupert’s “spirit animal” on asset allocation
Warren Pies / 3Fourteen: concentrated in US stocks, minimal non-US equity exposure, still holding a significant bond allocation
Broader Market Positioning & Leverage (Minute 6)
Goldman Prime data shows a significant de-grossing since the February/March peak
Net positioning remained rangebound (50–58) through most of the period, with the Liberation Day dip as the main exception
Gross leverage rose steadily from the 2022 lows to the silver market peak, then de-levered
Interpretation is ambiguous: bulls say room to reload; bears say big funds are cautious for 6–18 month horizons
Significant de-grossing observed specifically in tech; semis/memory remain crowded long; software is widely short (”vibe coding” narrative)
China Positioning & Revised Investment Thesis (Minute 9)
China hedge fund gross leverage is at post-COVID peaks, despite the property market remaining depressed — a deliberately controlled deflation of real estate as a savings vehicle
Key lesson: wasn’t “listening to the game master” (Jim Leitner concept) — Chinese authorities’ five-year priorities are AI, tech sovereignty, and sovereign resilience, NOT massive boost to domestic consumption
Market Concentration & the “Mike Green Market” (Minute 15)
Nomura (McElligott) note highlighted the reversion to narrow-breadth Mag-7 dominance after a brief period of broadening in late 2025
Described as a nightmare for newsletter writers; also problematic for long/short managers who build “alpha buckets” outside the mega-caps
The April rally anatomy: Initial positioning squeeze → Mythos (Claude) AI excitement → FOMO chase by underperforming funds
Hyperscaler CapEx Boom & the Kalecki Profit Equation (Minute 17)
Last Wednesday was the single largest earnings day in history: ~$12 trillion of market cap reported in one day
Big five hyperscalers (incl. Oracle) CapEx as % of GDP has gone from ~60bps to a projected 240bps — nearly 180bps of incremental drag/stimulus
Amazon is now spending more in CapEx than its EBITDA; others (Meta, Alphabet, Microsoft) in the 70%+ range; Apple notably absent from the CapEx race
Ben explains the dynamic via the Kalecki Profit Equation: profits = net investment – business savings + dividends + taxes; CapEx boosts reported profits because revenues are recognised now but costs (depreciation) are deferred
Result: net income/EPS ripping up to the right; free cash flow plunging (gap widened from ~$135bn annualised to ~$500bn for the hyperscalers); stocks follow earnings, not FCF — for now
Market won’t re-rate until expectations for future FCF come down
Current dynamic is a prisoner’s dilemma: each CEO (e.g. Larry Page: “I’d rather go bankrupt than lose the spending race”) is rationally maximising at the agent level even if the collective outcome is irrational
Two macro levers to watch: (1) US fiscal deficit — Liberation Day fear was deficit contraction via DOGE/tariffs; now deficits are expanding again via war spending; (2) a future administration (e.g. AOC-type) that actually prioritises fiscal consolidation over the stock market
Old capitalism framework (pre-GFC) no longer applies; post-COVID fiscal dominance + private CapEx boom = double-whammy profit support even as consumer/commercial real estate struggles
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