Today we connected real-world news with core market mechanics:
There was a meeting between Putin, Modis, between Putin, Modis and C, C is China, Modis is India and Putin is Russia.
Putin is Russia. In that meeting they were these three guys, these three people were representing more than 1/3 of global population.
I wrote on the blackboard bricks BRICS. Let me open this one.
No, not this one. Let me.
OK, let me.
Open this one.
Last class was the first time in my life that that you this this this is just a a a a recorder that transcripted.
Last class I I told you why I’m using this. I don’t have any idea. But just immediately after the class I took the transcript from teams and it was amazing because I put it into ChatGPT. First thing before putting it into ChatGPT, I use Gemini.
I mean I the Google one. I mean I.
Jemini doesn’t know me. I put the transcript and Jemini told me you must go to jail.
Because of all things that I said, you cannot teach in this way. Then I put it. It’s true. It’s true. I mean, not you must go to jail in this way, but but he was not so happy with my way of teaching the night.
I get that a little bit. So sorry in case anyone has got an offender last week. Yes. Then I put it into ChatDPT and with the memory ChatDPT knows me and he told me this is truly yours. But and he told me I didn’t have computer, I didn’t have means. So and he told me all then it’s yours and you are.
A good one. So I get better things, things. The other day I didn’t have computer. I open that. There was a computer. I called. Oh no, you know.
This.
He said he said call the computer people and they call. They told me they look, he look Mario came here, look at me, he said you are quick. He knows me and he thought he knows I’m crazy but.
He didn’t trust that. I told him there is no computer and he thought that I was your now at the end the white, but whatever, forget about that a summary of all things that we saw the other day. First important idea that is not written here, all things that are written here.
Who will repeat that? Accounting basics. I I were here. You are from Bolivia. I have showed you the outliers. Do you know what outlier mean? Anyone knows what outlier mean?
Outlier. What is an outlier?
Perfect. Let me start with a normal distribution function. Yes. What is an outlier? Some someone that is here or here? Yes.
I am using you. What is your name? Oh, so happy because you don’t know what names, what kind of names these people have now. Sorry for that. I mean, I mean.
I’m going to construct a wall. No.
What?
Well, constructing walls, no jokes.
I’m not going to take attendance today because I cannot pass the whole class taking attendance, but thanks a lot, but I’m going to write so here because I.
I’m going to go so quick, so quick. Don’t say yes. Don’t say yes. I don’t go navigate. Well, Sadan Randall, Alfonso Ruter, Alice Connor Sky, Alice Dahlia Bear, Amy Claire Tullet, Arianne Corrin Rising, Audrey Gray Smith, Carlton Aids, Charles Gato, Gato.
Gato. Gato. Gato. I said it correctly. You know, ghetto. Charlotte Dubois, Claire Dugan, Connor Hallenbeck, John Devaney, Dustin Greenwood, Dylan Avagorman.
Elena Agolino, Beth New York, Elizabeth McLillan, Mariko Mura, Eva Castello, Francesco Saracino, Frederick Dumber, Naimonen, Naimonen, Sorry, Gabriella Meyer, Gianfilippo Ciruli, Gordon Stewart.
Grace Morgan, James Lesesne, Jenna Massey, Harris, Yumison, Lisette, Rodia, Yamas, Loden, Sugar and Sol.
Anyone who I have not mentioned?
Who you are, Robbie.
Roby.
That it’s done. It’s done. Yeah. Hosting. Hosting, no.
Austin, who else?
Are you? Oh.
Either they ate up, would you know? Yeah, you did.
Oh, sorry.
So.
Slater, Logan, Ariel Lowell, Luke Maris, Train, Marco Cavallieri, Natalia de la Plaza, Noah Burcat, Olivia, Karolin Dorf, Remington Mester, Rhea Karin Bosch, Riley Kendall Peak, Robbie Stein, Seon Kim.
Simone Beatrice Paredes, Sophie Brown, Talia Trusca, Victoria, Victoria Delorme and Victor Victor Jensen and Yalan Yang. I have mentioned everyone. I’ve mentioned both of you. Not yet.
So you are Robbie Star the other. No, sorry, you are Austin and you are Robbie Star.
Stance and not out. OK, you are new in this class. Are you in there was a group? OK, because I was talking with so thinking that she was not an outlier.
But she’s an outlier. But I think that you are not outliers. Let me continue talking. You weren’t here the other day and you weren’t here the other day.
You were. Yeah. Oh, I was on that one. Oh, in the second one. Yeah. OK, so, so Robbie Starr.
What are you? Oh, Robbie’s staying. Sorry. Robbie’s staying, staying and and I will. I wrote and I I wrote thing, so and Austin.
Perfect. I think you are not an online quick summary. I use more things. Your name.
John. John. What else? Rainy. John. John. John. John.
John.
You I have.
Where are you got you? I mentioned no, yes.
And I I know that I have said John, oh, John Devaney. Perfect. And yes, just writing things. I think that you know what those liars are and all this stuff and that I ask things and you answer back. Don’t take it yet, but.
Living basis. There are people here from what I what I did the other day is to state the class has to do with the statistics. I have a group. I don’t know about this group who you are. You don’t know me either.
And I need to know you in order to adapt all things. I’m going to teach, say, trust talk, yes, to your knowledge, to your profile. It makes no sense to start talking about. For example, one of the things I wrote, I said is BYD. What is BYD?
BYD. You know it. No. Who knows BYD? Who does not know BYD?
So happy, you know it. That is a Chinese car, electrical car manufacturer that two years ago I could have doubts.
I could have doubts about what is better, a Tesla or a BYB now, now, now I take.
You do.
What do you want to? What do you prefer? I jumps or diving? Oh, jumps.
Oh, no, sorry.
Yes, there is a longer video where you can see this as I don’t want to see shorts. This is the one I want to.
Yeah, this is the longer one.
6 meters. They told you all the test. The car goes in an autonomous way, yes, and there are three obstacles, different obstacles.
It goes in an autonomous way, under 20 kilometers.
Yeah.
Look, do you notice the colors?
Does the car run over? It jumps. It brokes. It doesn’t. Do you understand the point? These colours mean something. It could. It can’t. Yes. Now do you see the provokes provocation? Yes.
Sure.
What is this? This is marketing. Of course it is marketing, but it’s marketing about Chinese cars that personally I would love to have. Not only a BYD, personally I would prefer to have a Xiaomi Xiaomi car.
I really, I I would really like it. And if you fully understand what is going on in China, probably you will understand better why Trump talks about tariffs so much. Yes, why I’m talking about this because the other day we were talking about this.
I send you the link with the with the meeting also.
Bricks.
Have you ever you know BRICS? You know BRICS because you are from Bolivia, but probably you don’t know BRICS because you are from the States. Depending on where you came from, your view of the world has one bias or another one, all of us.
All of us have bias all.
BRICS stands for Brazil, Russia, India, China and South South Africa. But there is also a BRICS plus where there are more countries. Yes, BRICS is.
A joint, a joint venture of of countries, commercial agreement and Brexit stands against G7, Yes. What did we do the other day? I draw this blackboard.
With a return risk liquidity, I asked for a lot of words and here you got a resume of all things we were talking about and I have to start with trust talk and let me see if there is something regarding.
Yes, BRICS, Xiaomi, beyond your dreams, TSMC. I’m not going to talk about TSMC, but T stands for Taiwan and they are manufacturers, semiconductors, manufacturers.
And we will talk about more things, more things. Yes. What is this? There’s somebody I have never in my life.
I have never given so much information after one class.
Probably I have no. I mean I have had classes worse than the other one. Not the worst. Worse in a sense that I have computer. I should I have to start talking. But the summary is incredible. So in order to finish.
You are from too late. Too late. If I ask to to probably 60% or 70%, I don’t know of your of your peers are from too late.
Does this matter? 60% of people matter.
One thing that I repeat the other day, and I’m going to repeat this, I don’t give a **.
About almost everything. I only care about one thing and it’s taking care. What does taking care means? Don’t really know, but taking care is asking everyone feel comfortable. I wish, yes, I’m doing my best in order all of you to feel comfortable.
But I cannot control everyone, so I am focusing on both of you. Why? Because you are the more ****, ****, ****. In Spanish it was. It will mean the same. I know that I am making a joke.
**** also is people that didn’t came to the other day class. Sorry if I am you feel offended by me, but he says no, I’m focusing on you because you don’t have all the information. On the other hand, I am not asking you. You came the other day and I am not asking you, have you fully understand all things? Have you?
I know you have, not you. I know that you have not read it or I don’t know if you have read it or not, but personally I prefer to assume that you haven’t read. Why? I want you to feel comfortable. Make sense.
And I want you to. The other day we were talking about bridge and the same. I don’t know if it was at that moment or not. Anyone from France?
No, friends. There was one person that speaks French. You are from France.
Why am I asking the other day we talk, the other day we talk, we talk, we, we, we, we, we, we means yes in in France. What is going on now today?
The contract today is in the parliament today for Boburi Boburi. Let me so, so in Spain we have a Akin. Yes, Akin.
That the king is the son of the oldest of the of the other king. Yes. And then we have Pedro Sanchez. Pedro Sanchez is the Spanish president. Yes, Pedro Sanchez.
Is the government, but the king is representative of the government. Yes, we don’t vote the king. We vote Pedro Sanchez. Make sense in France is not the same.
But it’s the same. It’s the same, but it’s not the same. Let me show you in in France. Correct me if I’m wrong, in France there is the president.
Oh, the Republic. That is Macro.
Macron and then French people vote both the president.
And the parliament and the parliament that is the Prime Minister, that is Boli. I don’t know how to write it. I’m saying Boli, but he was elected on December, yes. And last week, I don’t know if it was, if it was last week or week before.
He said I cannot come, I cannot complete my objective, so I am going to put my chairs to the parliament and today is the election. Yes, now there is a big, big political crisis in France.
Today.
Today is, I mean, I don’t have anything against France, against England, but today I’m not going to talk anymore about France today. But today is one day in order to follow, to track what is going on in France.
Make sense?
OK, so OK, now all these things came here, but what were the important things we talk about the other day?
OK, you didn’t. You guys didn’t miss anything. But also we start talking, talking, talking about things. You know, I have the slides. I’m going to share with you the slides and I’m going to start with the course today.
But you today.
I repeat a lot, a lot, a lot, a lot the other day.
Central banks. Central banks. I repeat, I thought I said more than 10 times. Central banks. Today, this week, Thursday, this week on Thursday, we will talk about the.
This Wednesday, Thursday, Thursday, Christine Lagarde will talk about interest rates.
What is she going to say? Probably she’s going to say that she maintains interest rates and next week on Wednesday, next week on Wednesday, who is going to talk?
Who is gonna talk?
Who is gonna talk?
Who is gonna talk?
September 17th of September, who’s gonna talk?
Yes, young. Yes, young. Who is gonna talk?
This is one. This is the important one.
You know, Paul, look one thing. Anyone knows Polymarket? Do you know Polymarket? You know, you know, you know, you know, you know Polymarket.
So Polymarket, what is finance about? The other day we were talking about finance has to do with the future. Can we predict the future? We will see in two minutes. The answer is no. At Polymarket, they make bets.
About the future, if you go into polling market, look one thing, this is just the front page, sorry.
New York City mayor mayor election.
Have you have? Who have had all this? OK, you also. Well, where? Where do you? Where were you one year ago? New York? No. Bolivia. In Germany. And you are aware about the New York City election.
Have you have a Super Bowl? It’s something that happens in the States.
OK, what? Why I’m showing you this phone? Is Super Bowl important?
In terms of attention.
If you would like to sell something, would you give in order to appear in the in the adverse of the Super Bowl?
I promise I don’t know who is.
That’s the mayor of New York. Oh, the two ones are related. Perfect. Oh, Norway.
Are you aware of that? When are these elections?
Tomorrow.
I’m going to post I I got tomorrow when you see in the morning my linked post regarding Norway elections. Don’t tell anyone that I didn’t have any idea today.
But a DPP makes miracles.
You understand that these are the things that matter. Look among all these things, which one is the first? Make sense? Next week, who is going to talk? Jerome Powell. Don’t worry because Jerome Powell talks each month.
Each month he talks. This is what is Jerome Paul going to say? We don’t know. We don’t. We don’t know.
We don’t know what this you know Paul wanna say.
He’s he’s going to decrease interest rate in 50 basis points. We will talk about what does this mean that he will decrease interest rates, no change what Jerome Powell is going to say.
John, what do you think Jerome Powell is going to say?
You think it, I think it and everyone think it because these 9% and these 4% does not has to do with people thinking. This means that people have that in the past when they didn’t have any idea of what is going on. Make sense.
And let me show you also.
Oh, this is a.
Let me show you the one that I like the most.
Let me, let me. Sorry, I didn’t mean this. I don’t always said them.
There.
Yes, this is the one I was looking for.
The one I like the most.
What will power say? Yes, look.
Will Powell say inflation more than 40 times in his speech? 85% of chances. Will Powell say 50 inflation 50 * 61 more than 60 * 32.
Go. We’ll say that more than 50 times.
Six months ago, he didn’t say tariffs. He didn’t say tariffs. In the first speech before Trump was elected, Trump said tariffs a lot of times, and he didn’t mention tariffs.
Answer it three times. Unemployment 20 times. Good afternoon. Will he start by saying good afternoon? There are people that say that if he start saying good afternoon, these are good news. If he say with something else than good afternoon, probably pandemic, maybe Trump. Will will he say Trump? He never says.
Trump Why? Because he don’t want. He doesn’t want to mix with politics. And I love. I love power.
I love Powell. Why? Because I think he’s a professional. Yes, recession comma. Yep. What I want to show you with this, that all the words of his speech are going to be me. So not by me, by a lot of people, by tons of people mix with a I.
And with the market sentiment, do you feel what I want to transmit?
Is this speech important?
Yes, yes. And because of that we will talk about that coming back. All things that I have say means almost nothing. What is important is I have said with you this, yes, I have already said and what is important is if you don’t know anything.
Regarding accounting, ask me or tell me if you or here you have. It’s important you to know what is the balance sheet, assets, reliability, equity, P&L. We are not going to do cash flow discounts. We will work with net present value. We will work with internal rate of return with both.
Valuation. I will tell you how to work with them, yes, but personally, if you don’t know anything regarding accounting, there are people here. I asked him regarding accounting the other day. What are the analytics and they didn’t know it. I don’t care.
I don’t. In Mexico, I don’t give a fact is being said. In Spanish is Mela Suda. Sudar means if you run Sudar, yes.
That’s not anything to do with gender. You can be a man or a woman and either I’m not making any discrimination because of gender. It’s political. Political is not correct. Say Melasuda, but it doesn’t hurt anybody.
Because of gender. He might be here, hear me saying this. Probably he would say Luis, you should be better. He has beer and I I like him, but he will tell me Luis, but he will not get angry because of gender, transgenders or all these things, yes.
I told you also the other day that I don’t care about. I just care about you feeling well and regarding my gender, I don’t know yet how do I feel.
Yep.
They like the queue of queer. I think I feel as if the queue represents.
Yep, and if anyone feels offended because I am saying this.
It’s not my problem. It’s something that I will go to the doctor if I were he or she and say all right or whatever you could. No, yes, yes, kidding, but I’m not kidding and.
We are in class and I don’t want anything that could harm us to leave it outside the class. We are talking about finance. The more, the faster, the better. The more standardized, the better. But we should be careful because if we go so fast.
We could leave important things. What the most important thing? Have you called your mom or your dad today?
But they are. Yeah, you are from Italian. Yeah. Have you called your mom or your dad this morning? No, say I’m doing now. Just kidding. But you know that your dad or your mom, you are abroad. I need your dad or your mom.
Drunk and he used to hit you. I speak sorry. Tell your brother or your this person that is there in the States or there in Bolivia or there in Finland that they are absolutely missing you. That’s what we think. This is important, I mean.
Finance is not as much important as families.
I’m telling you that that I love my mom, my dad, my kids is the most important thing I can. I think I can tell you this is out of finance. Yes, because it’s and I am not spending too much time. Make sense.
There are a lot of things happening. I have said you one thing regarding putting Modi’s and and tea.
And Putin took Modis by the hand and came to see. And there were three of them laughing. What does this mean? This mean that they were in that picture, in that photo, happy.
Careful because India and China are fighting with debate with several things. The war is now at a really, really, really complicated way. Accounting is important.
Risk, return and liquidity is important and this thing regarding our central banks are important. Risk, return, liquidity, risk, return, liquidity. We talk a little bit about risk, return, risk, return and I really said I didn’t show liquidity. I think as if I were.
In fact, all of you, I want to create a memory. John. Yes, I have taken John. I want to create the memory. Yes, I have taken John and I have told him. I have took him and I have told him tell me the war and he told me.
No, I don’t know. Tell me the war. I don’t know. Please leave me with either. Tell me the war. And the war is liquidity. And it is liquidity. Shame nowhere. Liquidity. And both of us have started saying something. Liquidity, liquidity, liquidity, liquidity, yes.
This memory, it has not happened, but is is liquidity important? Yes, yes. What is finance about? Finance is about.
The future where they return, where you are going to have, where are you going to have this return? The future risk has to do with uncertainty and liquidity is making things happen.
You want to sell? You need to find someone that buy. You want to buy. You need to find something that makes sense. Liquidity is making things happen. Can we predict the future? Let me can we predict the future? Let me show you another.
Please, I need your attention for 11 seconds. Yes, this is friends.
And the subtitles are in Spanish. The question this person is asking this fortune teller is can you predict the future? And he will say yes, I can, yes.
Yeah, I I can see the future. Make sense. Let me show you again and show you. These are, yes.
Makes sense. I don’t like violence. I don’t like violence. I’m sorry for using these.
We deal with violence, but have you understood?
The point? Can you predict the future? No. Can you manage an uncertain future? Yes. What is finance about? Managing an unexpected future? OK, all of you.
Are in the all this is probably these links regarding poly market. Poly market is important. Poly market is decentralized. Poly market use blockchain. We will talk about blockchain a little, not today, yes.
All of you should be. There was a group and there is one person that was seen the other day. You. Oh, you were. How do you feel? Yeah. What is your name? Gordon. Gordon. Yeah, I’m not in the WhatsApp.
Oh, OK. But but you know him. Yeah. Yeah. Espamigo. The other day you told me that he was still and and then later I go to my computer and I phoned your e-mail and I answered you back.
Set things or look the Yep and perfect. So quick, so quick. Yes, this is a group of WhatsApp that I got with myself and let me share this with.
You I’m sharing these these are the slides you I don’t know yet how to take attendance for everyone. Sorry for for this lack of knowledge and I have I don’t know yet Moodle group is open.
Moodle group is open and you cannot find this is like yet in Moodle because I have not uploaded. Sorry for that I will do it. But all of you have these slides in a OTC way. What does OTC stand for over the counter?
This WASA group is not official. If you don’t want to be in the WASA group, it does not matter because in the official place you can find all the information, but personally.
Look, I have talked about polymarket, I have talked about and I am showing you videos and I am saying in an instant way, in an instant way all things that I’m talking with you. Make sense.
Hey, yes, let me start with the class.
Do I have to start with the glass?
Do I have to start with the class?
I haven’t even.
I haven’t even there are the slides, but I haven’t one day and 48 minutes without starting with a class.
I mean, I have to start with the question. I know this way. Yes, you know a lot, a lot. There are times that if you go in an official way, if you go in an official way, you go slowly. You should one step, another step and one step, another step. Official.
Official, official, nonofficial. And at the same time, monetary policy that has to do with central bank, fiscal policy that has to do with expenses and incomes. Monetary policy at the end, if you want to learn, if you want to learn, you should combine.
Try to understand me with chat GPP, with knowledge, with exercises. Next day I will give you exercises in order to to try. Yes, doing things. I will ask you also to prepare things in order to serve with us, yes.
But let me start. What are we going to do today? What are we going to do? Introduction of the car, subjective structure, methodology, then the importance of information and some words regarding the Spanish financial system that I don’t care too much about the Spanish financial system, but.
Hey.
But or we will finish at 9:30 and we will take the whole class in just one. Do you feel bad about that?
My you say yes. No. Is it OK? OK, OK.
I don’t care too much about the Spanish financial system. I care about standardization, Spanish. Look what I have told you regarding France and Spain.
You French people vote this one. In Spain we don’t vote our King. Your president would sound like Macron is at the same level of Trump, but in the case of the States, you don’t have this division.
Trump is at the same time the president and the Prime Minister. Make sense? Trump represent these two figures at the same time. In Spain we have two people, the king and the you understand the point. What I mean is that.
I don’t care talking about the Spanish financial system and I won’t talk about the Spanish financial system. I will talk about the Bolivia. I don’t know a word about the Bolivia financial system. Do you have your own currency?
And Evo, Evo Morales also. Evo. Oh, used to be. Sorry. Used to be. Sorry. Luckily, he’s not anymore. Careful with. Careful with.
And I’m not telling it to you. Careful with saying, oh, Trump, he can start walls and I don’t like walls.
Because someone could get offended. From my point of view, a wall is something that separates people and something that separates people is something bad by definition and also.
I don’t care about Pedro Sanchez.
They are the boss and the boss. There are two things that we should be the boss, we should be, we should respect our boss as we respect everyone else, but also we should be critics.
With what the boss is to make sense.
Is it possible to respect at the same time than to be critic? I think that it’s possible. I think that these are much and I think that is one of the things that I should transmit you, but at the same time that we can criticize and respect.
These two things are possible. We can criticize without without it. We can criticize without fighting. We can. Yep, standardization, Spanish financial system, Spanish government is like.
French in the case of France and Spain.
You have euros in the case of Finland. Sorry for not knowing because Norway does not have euros. Perfect. In the case of France and Spain, we have a common.
Monetary system, but different financial systems.
All, all, all financial system all over the world are all financial system all over the world are standardized.
Who all financial instruments all over the world are. If you want to buy public debt, if you want to buy public debt, whole public debt is constructed no matter in which country you are the same. All public debt are is the standard, yes.
Yo, why financial instruments are standard? Because we want.
Liquidity. Whole finance. Why financial instruments? Are all of them standardized? The more standardized, the more liquid, the more liquid. The more standardized, the more liquid. You understand why?
Because I am an investor, I am sitting in New York and I don’t care about.
Distinguishing Italy, Portugal or Spain. I don’t care. Why I don’t care? Because same sea Mediterrane, Portugal. No, sorry, there is a new Portuguese. Don’t get angry with me, but same same ranks. Yes, Portugal.
Greece it they are want together and I I have my money. I want to invest in this zone and don’t don’t tell me no careful because in Italy you should buy in this way. I’m in state now buy if you want to buy.
In this territory.
You will buy it the same way, but it happens the same in France or it happens the same in in Burundi. It happens the same in no matter in which country in the world you are or financial system. I will repeat this a lot of times. Have you? All of you have, but have you been in an International Airport?
Who all international airports are, no matter in which part of the world you are. Why? Because you need your liquidity. You need people to move. I have to take this plane there. You should go who all are.
The same traffic signals. Hey, where is my big friend? Just give me because you drive on the other side, but whole traffic system is standard and in your case that you drive on the other side, the signals, the stop.
They forbidden the way, yes.
I love this one.
Is the first time I’m asking this in class? Is the first time I’m asking this in class? Does this mean the same no matter in which part of the world you are?
Korea. This means you cannot pass in Korea.
China. This makes this signal in China means you cannot pass.
Perfect. It’s the first time I have asked this question. Now I will ask it more often and.
A little omenacs to Italy. This happens.
If this signal is standard.
Klett Abraham. You know Klett Abraham.
Sorry. Oh, sorry for that.
Do you understand it? He takes signals and he makes art with that. I I really like this because normally we see signals, how all the signals are boring.
They are the same. Nobody could think that from a signal you can create that. Yes, I like this twist, this twist, this from conventional things you can make unconventional things. But this is let me come back.
Let me come back, come back, come back, close, close, close. What are we going to do today? We are going to start talking and some notions today, some notions, price and value, finance, risk, liquidity. Can we predict the future? Black Swan. Oh, black Swan.
Anyone knows when he’s have that one?
Next one.
John, you know it. Yeah. Yes, we will talk about it. If we are talking about predicting the future, if it is, is it possible? If we are talking about public debt, public debt, public debt is something secure.
Governments always pay their debt. What if a government will not pay their debt? All things that I’m talking in this class will mean nothing. Yes, so public pay their debt for sure. Governments pay their debt for sure. And in the case of a black swan, nobody can predict a black swan by definition.
It’s something really absolutely unpredictable. It’s a it’s a book written by Nassim Nassim Taleb.
Nassim Talef is the one. Black Swan is the book.
I don’t have any Commission. I’m sorry for.
I mean, I don’t have any Commission and Nasid Talent, Nasid Talent, Nasid Talet, sorry, said in the past there used to be white white swamps, white swamps, white, white, white. And if you ask anyone how old swamps in the world are.
Are white. Is it possible to have a black swan? Nobody will ask this question. All swans are white. And one day something absolutely unexpected happened. A black swan appear from that moment.
Whole swamps are black and white, and nobody, nobody thinks too much about, oh, black. You understand the point, no?
The pandemic. Is it possible?
A pandemic to exist that will stop the war.
It’s not possible. What if now? Nobody was thinking about that a pandemic would happen and stop the war? Yes, nobody. Is it possible?
Nobody was asking this question, so I cannot answer this question because nobody was asking this question. And once the pandemic happens, all of us becomes expert. Not only a pandemic can happen, all of us knew it that it was going to happen and we are expected about the coronavirus types.
And we know specific special way the 19. You understand the point. What is a black swan? Something absolutely unexpected. Chinese people who can Chinese?
Manufactured 20 years ago, China was a developing developing country. Yes. Can China manufacture cars? 20 years ago, China was a developing country. They cannot. And now they manufacture amazing cars.
You see that it’s something unpredictable. Nobody was thinking about that. And from one day to another one, a Black Swan transforms into a reality.
I’m going to show you in 2-3 classes what is money and I will take a 2022 graph and in this 2022 graph NVIDIA didn’t appear in 3-4 years NVIDIA has.
Media is the company with the highest capitalization.
Another black swan with the Internet. There are black swans every day. Dozens. I mean, I’m exaggerating, but there are lots of black swans. Make sense.
Fintech. What is fintech? Blockchain. Crypto is the the point where the Internet converts with the financial system.
This is me.
This is my LinkedIn account. Let me show you show you. Yes, what I have written today.
France, I have not this morning. I program it yesterday. France is what I have told you. I have written this in there in LinkedIn if you.
Contact me now I will say, I will say I will connect everyone every today. Once I go out of this class, I will say to everyone in two weeks time. If you want to connect me, please tell me that you are from this class.
Because with Linkerin I am at the boys and I have I received a lot of connection and I try just to contact with people that I know from before but so if you want to contact me so.
John can call. I know him. I will. There are times that I say no, no, no, no. It’s not of being a polite. It’s because that is it’s growing.
Do you see that my life with a computer is easier, that I can tell you much more things? It’s absolutely powerful service. Oh.
Forward speech.
September.
I was looking. I want. I will write it this afternoon or tomorrow there was a.
This Wednesday? No. Next Wednesday. Next Wednesday is an important date. Why? Because holy market, all these things. Yes, power speech is important.
OK, all of you have my mobile step from you Gordon, but but you have my e-mail and whatever. I am at your service. What does this mean? I don’t know. I don’t know what does this mean, but.
But what does this mean? I know that you are in a country that is not yours, that you have just a right. Whatever you need. I’m a lawyer. I’m not. I’m not that is my students. What I mean is that if you have any problem, I’m.
You get drunk and you are arrested by police and you have only one call. You can call me. I will go and I will not charge anything and I probably I will try. Nothing to be known. I will not come here or not yesterday. No, whatever you need, yes.
OK, course objectives, principal aim to know and understand the financial system.
This is this aim on one hand is absolutely, absolutely simple and and at the same time.
Is something that you will never finish to complete in your whole life, no matter how how much you know, no matter how old you are, that you will never, you will never fully understand how does the final act and if.
Trump has show us several things. Trump has show us which we we should be thankful to Trump because of so many reasons. And one of the reasons is that he has show us that we will never keep there.
It’s they could be different. It’s they could be a surprise and and last semester I I yo trap 50% of the contents of my classes and probably this semester I will vote.
Run and now at more than 10% or 20% for food.
Because Trump makes things. Yes. OK, financial system. What is the financial system? What is the financial system? Finance has to do with the future. But the finance system? What is a system?
What is the system?
Anyone, what is a system? Can you give me an example of systems that are not the financial system?
Can you give me examples of systems? Yes.
So happy, deeply careful.
I’m not not nice, whatever it is. I don’t know even in Spanish, the lungs, then regulatory system is part of the respiratory system. I don’t know.
But you understand that the circulatory system is another system and my way of thinking I have talked about oxygen, that oxygen came inside the and then the circulatory system is the one in charge of making. I prefer the circulatory system because.
Central banks are is like the heart. Central banks are like the heart.
Banking system. Banking system is like the banks. Inflation is like tension. Sorry, inflation. No interest rates is like tension. Yes, tension and inflation is like cholesterol.
Inflation is like cholesterol, yes. Circulatory system, respiratory system is not a system by itself. It’s part of a bigger system that is the human being, the body. The body is a system, no.
An arm. If I cut my arm, is this arm part of my system anymore? No, it’s part of the system has it’s there is.
Paul, some Paul. That is one letter from some Paul. I’m Catholic, but I don’t care. You can be whatever you want. If I am Catholic, I am also you.
This is Christ what this was. But there is one letter from Saint Paul where he said that the human that the body was a system and that hand cannot be angry with another hand. The feet feet has one reason to be eyes another one and each part is good by itself. Yes.
Solar system, economical system. What is a computer is a system? Operational system? Yes. What is the point of a system that is one part with where all the parts from the system are interrelation?
But the system is 1, yes, financial system is one. What is? What is the aim of the financial system?
What is economy? I’m not talking about finance economy. Anyone knows the definition of economy?
Economy. Nobody definition from of economy.
No one economy. You can Google it. Also all of you have a computer in front of you, so you should when typing, you should be typing.
It should be. I know, but I don’t want to go into their things that happened to me. The system by which your community, nation, or even the world manages extended resources to produce, distribute and use.
Perfect. Perfect. Can you summarize it?
It’s just the way that a community or nation. Can you summarize these the words?
Manage researches.
Perfect. Perfect. Absolutely perfect. Manage resources. Look that I am treating you as if you were. Sorry. What is your name? Olivia. Olivia. Olivia. Olivia. Olivia. Olivia. Olivia. Olivia. Caroline.
Oh, is that it? Yeah, perfect.
Finance. Sorry, finance, economy. Economy has to do with resources. Air is one of these resources.
Air is one of these resources that should be managed by economic care, because air and pollution has to do with that. We are not buying air. Why we don’t need to buy air?
Why is free? I’m looking for scarcity, scarcity, scarcity. These resources to be scar, no scar, scar scarce. These resources should be scarce.
OK.
And because this is course, these resources are scarce. You say the government at the beginning, no?
Countries, community. Perfect. Did you say community? It’s perfect for me. But did you say countries or nations or governments or?
Allocation, allocating resources.
Knowledge is a resource, but knowledge. Careful with knowledge because love, love and knowledge, information, love, knowledge and information is not for today. Love, knowledge and information. Because with love, knowledge and information, the more you be, the more you have.
The rest of the resources, if I have money and I give you money, I have less money than the money I used to have. So I will ask you for we don’t make sense.
Economy. What is the financial system? The financial system is the system that allocates all these resources.
Do I have to say, oh, I have sent money to you. So to to solve, I have used the word money, but we’re talking to you, Olivia. I didn’t use the word money.
Yes, yes, but no.
Oh, I love money. We talked about money the other day. Money itself is a resource, but it’s not a resource. What I’m trying to say is that money is a tool that help us allocating resources.
Money is a tool that help us dealing with information. Thanks to money, we can know price. Thanks to money, we can know your. Thanks to money, I can know your your buying power, how much things you can buy, but money by itself.
It’s not something that we need for something in particular with just one. Yes, I cannot run account with money with gasoline, yes, but with money? No. Make sense. What is the financial system?
There are people, there are people that have more than what they need. Oh, are we going to call this savings? On the other hand, there are people that has.
Less than what we need, than than what they need or what we’re going to call this side financial needs or needs. Why financing? Because as we are talking about the financial system, who are all these needs financial.
And financial savings, but forget about financing, yes, saving and savings and needs. What does the financial system do?
Connected. How? How? In two different ways, in a direct way, in a direct way, or in a indicted way, the direct way.
Savings and financial needs are connected direct by the markets in an indirect way by what we call financial intermediaries that careful with financial, careful with language.
Careful with language because same war could have different meanings. Understanding finance is simple, but we create difficulties because if these were simple, you cannot charge $1000 for one concert.
If this were simple, like people cannot, I wear a tie because I want this to look serious. If you understand all the words at the beginning, the ability equity, there are a lot of words that are simple, but the abilities what way coverage cost.
There are what I want to to say is who are these financial intermediaries?
Who are these finance intermediaries?
These financial intermediaries are called banks, banks or insurance companies, banks or insurance companies. Financial intermediaries are banks or insurance companies.
Can you look with careful with language? Markets connect direct. Can you buy direct in the market? No, you cannot. You need an intermediary in order to buy a stock. You understand what I’m saying?
I’m not talking about these intermediaries. If you want to buy a stock, who you should talk with? We talk about them the other day and we will talk more. If you want to buy a stock, who should you call a trader or a broker that also are known as intermediaries?
Do you understand that I’m using same word for talking about two different things? If you want to buy stocks, you should use an intermediary and then savings and financial needs are connected through intermediaries.
I don’t want to create confusion. What I want you is to see that there is confusion in terms. There is confusion. Yes, OK, coming back, finance and intermediaries are banks.
And.
Insurance companies, banks and insurance. Banks and insurance. Banks. Let me take this out.
Bye.
And insurance, yes, banks, insurance and then.
Banks, insurance and then.
Markets, yes. Banks, banks, insurance and markets. What do banks do? We will talk about banks for two weeks or three weeks. Yes, today I am just introducing ideas, notions. What does?
About blue.
What does an insurance company do regarding banks? And let me look for red red banks stakes.
Deposits.
Yes.
And insurance takes.
Premiums. Yes, premiums from the their contracts. Premiums.
And the point is, if I need money for sure, who will I talk with? If I need to build a house, who will I talk with? No banks, financial needs they need, they deal with.
Are certain certain financial needs. If you need money for sure, you will call your bank.
You have savings, you put your savings into a deposit, yes, and you need money, you will call the bank and all that financial needs insurance companies deal with and certainly.
I don’t know if I will break my leg today. I don’t know if I will die. I don’t know if I will have a car accident, but just in case, because I’ve got an insurance, because I have paid my premium in case I am ill.
The insurance will pay me. In case I have a car accident, the insurance will pay the repair, the repair, and in case I die, my kids will have money in order to go to university. Make sense. These are uncertain.
Answer that yes. Now the other day, the other day I talk.
About this and I will talk about this next day and I will repeat important things. I will repeat them a lot. Who supervise? Who supervise banks?
Let me start with markets. Who supervise markets?
Who supervise market SEC?
SEC. I’m talking about the states. Careful, because I’m talking about the states. In Spain it will be Commissiona Fiona de Merca Valores. Italy it would be a different one. In Finland probably it would be a different one. In UKI don’t know the name also, but it could be a Yep.
What the supervisor do? They asked us if they were policemen or policewomen. Yes, they asked us police. What does this mean? Three things. If you want to operate, who will give you the license?
SEC.
If who will take if the things have been made correctly? SEC. And if you have a bad behaviour, who will punish you? SEC. Make sense?
Then who supervise banks? I’m talking about the states.
Wait, wait, they’re all research.
Federal Reserve, Federal Reserve not only supervise banks. Federal Reserve also is in charge of.
Federal Reserve is insert. Oh.
Monetary policy, Monetary policy, interest rates. What is going to happen this Wednesday? No, Wednesday after this Wednesday. Next Wednesday, Jerome Powell is going to talk about interest rates. Who is Jerome Powell? He’s sitting on the chair. He’s sitting on the chair.
And what? What is monetary policy? I am summarizing a lot. Today is not the day in order to talk about monetary policy, but what is monetary policy about?
Interest rates. Interest rates. Yes, I am summarizing a lot. Yes. What is economy about? Resources. Scarce. Scarce resources. Scarcity. What do you say? Scarcity. Scarcity resources.
Scarcity resources. There are words that I don’t. I will not. I will never say correctly because I have an indicated and one of them is hedging, hedge, hedge. What do you do with risks? You hedge.
It’s correct. I have said it correctly. I don’t want because I want you to. I want this word. I want words to go inside your head. If we did this one, head deep, head deep is another one and scarcity, scarcity.
It’s another one. Expectations, expectations, incentives, expectations, incentives are important words for us. Why do we do things? Because we have expectations and because there are incentives, incentives, incentives, incentives.
Incentives, incentives. We need incentives because we need incentives in order to go out of bed. So we’ll be blessed because if not, where where would I be now if there won’t be incentives?
May, but I’m here because of money. I’m here because of money.
20% or 10% because of money. I would not have gone out of the day this month because of money. Money is there. I need money. But also you should find something else than money, you know, I think I wish for.
I want to think. I would like to think that you know why I’m here. I think I’m here because I really enjoy what I’m doing. It hurts, but I say I’m going to see you and so he’s more than I didn’t know that so was going to be here or this best or.
Or or another Italian. Where are the other two Italians? I don’t know. Yeah, me neither. Whatever. Federal Reserve supervisor, SCC supervisor. What does SCC supervise market?
Targets. What does Federal Reserve supervise? Banks, but also Fed is in charge of monetary policy. Makes sense. Then who supervise insurance companies? PDIC in the States, but I’m Diracion general de Seguro, Si fondos de penciones in Spain.
Because this class is international, I’m not going to focus too much about who supervise insurance. I want you to see, to understand, to know that insurance exists, that insurance are important, but regarding supervisors.
I want you to focus on FES and SEC and also in your case you should look about who supervise banking and Bolivia, Korea, China, Finland.
In Norway, you Bank of England, you understand that Bank of China, Central Bank from China and I I will really care about Chinese monetary policy regarding about the British monetary policy and how you guys are dealing because being an island is being.
Smaller and being smaller is more flexible. But regarding, for example, unemployment, you have less power than being big. There is. We will talk about all these things. Make sense.
Hey.
What is a market? It’s a place where products and then market the difference between price and value. We talk about this and why markets has. What is a market? What is a market? It’s a place where savings and financial needs.
Gets in contact. How price? How price? How do I know if you? How do I know if I can buy or not? Price. Price is the answer regarding information. We will talk about information next day. Next day we will talk about information. What I want to say in order to close this class. Why do?
Markets needs rule rules. We talk about this the other day, but let me repeat. Why do markets need rules? Because of three things. We enter at eight. I have agreed with you to go out at 9:30.
Why? Because we need to know at which time do we start? Because we need to call. Oh, I have a meeting I have. We need to organise ourselves. I can have rules in order to this, but also in this class I’m talking.
I can have power of doing things and I can make mistakes. I can abuse of this power. Also we need rules in order to protect weak parts of the system.
Regarding information and liquidity, we also need rules. Why? Because markets need help in order to open. We also need rules because there is no point in in just protecting you in just agree.
And making an agreement regarding times. Also we need rules because because we need to operate rules will have to do them with rules will have to do with.
Liquidity. Perfect. Rules will have to do in liquidity because if I want to buy for example a public bond, there should be liquidity and there could be times where there are no sellers, but there will be someone that will call him or her or he.
Market maker that will make this liquid, yes, but we will see all these things next day. Any questions?
Sorry for having class at 8:00 in the morning. It’s a disaster, but it’s what it is.
It’s hot. Sorry for that motion.