This is Trend Following Radio, where great thinking comes alive.

Nobel Prize winners, legendary traders, bestselling authors, and the pros that know what drive us irrational human beings.

I am your host, Michael Covel.

Not filtered, raw, honest.

That's my passion.

The topic inspired from my watching a recent film has come out in the last year or two,

a standard issue retrospective on the Great Recession. Regulators screwed up. Human nature is such

that we blow bubbles and pop them. And now there's a great fix that the government will

be able to do for us. The film, Boom, Bust Boom, got me thinking about Hyman Minsky.

Hyman Minsky, an economist, who was not very well known, but after the Great Recession,

regulators, central bankers, etc., all looked to him, this debt economist,

they all look to him for insights on the next bubble that will come and will pop.

In fact, I'm looking at a headline right now from BBC News.

Did Hyman Minsky find the secret behind financial crashes? Let me play an excerpt from this BBC report. So let's take a closer

look at Minsky's three stages of finance model with a little help from Eddie Cochran. It applies

to all types of debt,

but the easiest way to understand it

is to think of a typical home mortgage.

The first stage,

which Minsky called the hedge stage,

comes soon after the previous crisis.

Both banks and borrowers are still cautious.

...