This is a special edition of Macrovoises with hedge fund manager Eric Townsend.

The premier financial podcast targeting professional finance, high net worth individuals, family

offices, and other sophisticated investors.

Now for this special edition of Macrovoises, here's hedge fund manager Eric Townsend.

Macrovoises All Stars episode 57 was pre-recorded back on September 10, 2019.

I'm Eric Townsend.

Louis Vincent Gav, co-founder of GavCal Economics, is back this week.

Louis, there was a dislocation in markets, which was kind of a ripple under the surface that some

people didn't even notice. There was a major dislocation between value and growth stocks

that occurred last Monday. That would be a week ago today by the time our listeners are hearing

this episode. I don't think that this has really got enough attention because overall the

market was flat. It seemed like to the average observer who's watching TV, no big deal day in

the market. It seems like it really was a very big deal. Give us a little bit of context.

What happened here and why is it important?

I think it is important partly because if you look at recent years, what we've had has been a

massive outperformance of growth, a massive outperformance of tech, a massive outperformance of the

US. I think we probably want to be sensitive to potential changes there partly because the

valuation gap between growth stocks and value stocks is pretty close to extremes.

When there's ripples, there might be an important signal.

Why did this occur? I think if we take a step back, one of the most frequent questions I've

been getting from clients is over the course of the summer is, I don't get it. I've got

bond markets that are telling me that growth is going to be terrible. The yield curves are

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