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Zed Francis, chief investment officer at Convexitas, joins Jack to talk about interest rate risk, what really happened to the British pension system, and tail risk as a portfolio diversifier. Francis argues that December 2022 will see a wave of mandatory liquidations by the U.S. retirees forced to take mandatory distributions on their retirement accounts. These forced sales will be larger as a percentage of the typical 60/40 portfolio than they normally are, due to the drawdown in stocks and bonds that have already occurred this year. Filmed on November 8, 2022.\n\n--\nFollow Jack Farley on Twitter https://rb.gy/uesguv\nFollow Forward Guidance on Twitter https://rb.gy/cy0dki\nFollow Blockworks on Twitter https://rb.gy/igyzsj\nAbout Convexitas: https://www.convexitas.com/\nConvexitas\u2019 piece on Liability-Driven Investment (LDI): https://www.convexitas.com/insights/liability-driven-investment-de-risking-if/\nConvexitas\u2019 piece on duration risk: https://www.convexitas.com/insights/rates-free-risk-duration-duration-everywhere/\n__\nGet top market insights and the latest in crypto news. Subscribe to Blockworks Daily Newsletter:\nhttps://rb.gy/5weeyw\nMarket commentary, charts, degen trade ideas, governance updates, token performance, can\u2019t-miss-tweets and more. Subscribe to the Blockworks Research \u201cDaily Debrief\u201d Newsletter:\nhttps://rb.gy/feusos\nFind out more about the Blockworks video editor role here: https://blockworks.co/careers/\n__\nTimestamps:\n(00:00) Intro\n(00:33) The Financialization Of Everything\n(10:27) Private Markets\n(17:01) Duration (Interest Rate Risk) Explained\n(19:35) The Losses From Rising Rates Are Immense\n(26:26) The U.K. Pensions Crisis - Explained In Great Detail\n(38:41) Stocks and Volatility\n(41:53) "Ignore The VIX"\n(45:19) Tail Risk\n(50:47) Are Active Investment Managers Underweight Stocks?\n(01:00:07) The Different Phases of A Bear Market\n(01:07:46) The Credit Markets Are Frozen\n(01:10:21) A "Waterfall of Liquidations" Is Coming From Forced Selling From Retirement Accounts\n(01:19:45) The Value Of Portfolio Overlays\n(01:26:00) Basis Risk\n__\nDisclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets.