Why Passive Investors Lose | Contrarian Investor Michael Green
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If money in a Bitcoin framework gets too expensive, there is no mechanism for adjustment. And so ironically, Bitcoin is actually anti human ingenuity. In a scenario in which the price of money is going cuts off access to many forms of capital, debt.
Welcome to Bankless. This is Ryan Chaun Adams. It's just me today, so I'm here to help you become more bankless. Michael Green thinks the dominance of passive investing has made an absolute mess, a catastrophe out of our existing financial system, and someday, he thinks it's gonna bite us in the ass. We're gonna pay a very high price for blindly following the crowd. This was a fascinating idea. And very much like crypto, it's certainly not the mainstream take, which is exactly why I found it so interesting. Few things we discuss. The problem with index funds, why passive investors lose, Volmag
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Bankless Nation, I'm very excited to be joined by Michael Green. He's a chief strategist at Simplify Asset Management. He is also a thirty year market structure contrarian who just simply hates passive index funds. Michael, welcome to Bankless.
Oh, thank you for having me. I actually I I have to clarify that. I don't hate index funds. I hate what they are doing to the market and the fact that they are effectively that that that an external forcing has been introduced on them by the government. So let let's be very, very clear on that.
I like that. Yeah. I, you know, there was a tweet sized, summary of of my take on your take. But, yes, we we do wanna get into the the clarification of the problems that you see in passive investing in general. But before we do that, you know, the way sometimes you actually pop up on my Twitter feed is just occasionally, and I'll see you in kind of arguments in in, I guess, the finance Twitter. So much of the bankless audience, I myself, very much in this realm of of crypto Twitter, crypto x, basically. And that's a bubble in and of itself. Yep. And then you've got finance Twitter, and often s
Well, we largely get into weird arguments about whether level two are parasitic. Sometimes we'll talk about whether it's the same sort of esoteric stuff. Right? So you will have discussions around should these assets be valued as money? We'll have discussions around, well, what is actually money? Is gold a monetary asset? Is the dollar a monetary asset? Is Bitcoin a monetary asset? Should it be thought of as a store of value? Is there something unique to that? How should you think about valuing securities given that they are financial claims? These are all the same sort of discussions that we
You know, I tweeted this out this morning, Michael, because I was just thinking about doing this episode with you. And I I said, in my darker moments, I wonder whether fundamentals actually exist or if it's just narrative all the way down. What do you think about that? Do you think fundamentals exist?
I think that fundamentals exist in a statement as to what has happened in the past. Right? It's a little bit l
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