When I say; I am a Macro Analyst.

What is macro analysis, and why does it matter? For me, it is looking at the top-down view of the world based on how economies move the macroeconomic variables that drive asset prices.

You may say, does that matter? Why care about where an economy goes? Well, it’s obvious that most people misunderstand that is if the economy is doing, asset prices do well, when economies do badly asset prices do badly. So understanding where economies are going is crucial. For many, the problem is the world is not an isolated world with just one economy.

While the U.S. is the most important economy, there are a whole number of other macro variables; how other countries are doing and the interrelationships between countries, these are what drive exchange rates, interest rates, and further drives assets prices. It also drives the when and what you should be buying and questions of whether you should be investing in metals, commodities, crypto or bonds or should you be selling them, all these are all macro things. Things like whether Tesla will do better this coming quarter that’s not macro, that’s a micro variable.

When things get extreme or those turning points like the Ukraine crisis, that’s when macro matters, why? You may ask, well, it is because it’s the biggest driver of portfolio returns over time. Most people don’t understand it because it’s complex, it requires homework analysis and a broader understanding of the world.

For many investment managers, it’s easier to try to punt an asset movement based on a chart and some potential news flow, but that is not really what builds a long-term investment opportunity. That’s the key thing about what macro is and why it’s important.