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James Davolos: The Best Businesses To Own During Inflation

Let’s talk about the 4.2% elephant in the room, that’s right! This week is all about inflation and luckily we had the privilege to talk to James Davolos, Portfolio Manager at Horizon Kinetics, to help us understand inflation at a deep level.

We talked about what is the CPI and how it is measured, the effect that inflation has on risk assets, what is duration on risk assets, how not to hedge against inflation, but most importantly he shared how we can effectively hedge against inflation by investing in companies that are Direct Beneficiaries, Indirect Beneficiaries or Opportunistic Beneficiaries of Inflation, which are exactly the types of companies that you can find on Horizon Kinetics’ Inflation Beneficiary ETF ($INFL).

This episode is brought to you by BullpenCareers.com. BullpenCareers.com is a job board exclusively for finance jobs. If you or someone you know is looking for a job in finance, check out BullpenCareers.com today!

  • [0:00] Who is James Davolos?
  • [3:44] What is the CPI and How is it Measured?
  • [8:15] Fiat Currencies Always Go to Zero
  • [10:30] Modern Monetary Theory
  • [14:20] What Inflation Means to Risk Assets
  • [15:00] What is Duration on a Risk Assets?
  • [20:00] The Inflationary Beneficiary ETF
  • [21:00] What are Hard Assets?
  • [23:00] Direct Beneficiaries, Indirect Beneficiaries, Opportunistic Beneficiaries of Inflation
  • [32:00] TIPS: The Biggest Misconception Regarding Inflation Hedging.
  • [35:00] Cryptocurrency
  • [37:00] Western Ideology vs Eastern Ideology for Gold
  • [40:00] Texas Pacific Land Corp ($TPL )
  • [42:00] Exchanges The Ultimate Indirect Beneficiaries of Inflation: London Stock Exchange ($LSEG), Honk Kong Stock Exchange ($388), Singapore Exchange ($SGXR)
  • [50:00] How not to Hedge Against Inflation
  • [53:00] Closing Questions and More from James Davolos

If you want to learn more about Horizon Kinetics, check them out on Twitter and their website.

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Brandon Beylo

Senior Partner at MO, PM at Foundation Capital, lead value investor, ValueHive podcast host, and a tennis nut. https://www.x.com/marketplunger1

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Brandon Beylo

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Brandon has been a professional investor focusing on value for over 13 years, spending his time in small to micro-cap companies, spin-offs, SPACs, and deep value liquidation situations. Over time, he’s developed a deeper understanding for what deep-value investing actually means, and refined his philosophy to include any business trading at a wild discount to what he thinks its worth in 3-5 years.

Brandon has a tenacious passion for investing, broad-based learning, and business. He previously worked for several leading investment firms before joining the team at Macro Ops. He lives by the famous Munger mantra of trying to get a little smarter each day.

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