Michael Aronstein Poised to Get Rich Off Inflation Derp

A blog about business and economics.
Jan. 3 2014 10:33 AM

Michael Aronstein Poised to Get Rich Off Inflation Derp

Hot off the presses

Photo by Dylan Martinez-WPA Pool/Getty Images

Michael Aronstein's Mainstay Marketfield fund is a new start on Wall Street, with $12.4 billion in inflows making it the most popular actively managed fund around. How do you bring in all that cash? 


The only period that may be comparable to this is after the discovery of the New World, when all the Europeans looted all the gold and silver, new money out of the sky, a la the Bernanke Doctrine. You had, basically, a century of inflation in Europe. The tulip bubble didn’t come out of nowhere; that wasn’t just people’s appetite for flowers.

Two points. One this historical analysis makes no sense. The Federal Reserve can make monetary policy tighter if tighter monetary policy becomes appropriate. Mining-based monetary systems don't have this feature. If sustained inflation occurs in 2014 or 2015 or 2016 or whenever that will necessarily be a result of future excessively loose monetary policy, not of anything Ben Bernanke did in 2012 or 2013.

More importantly, however wrong you think my analysis is, there is absolutely no reason to go out and invest in exotic mutual funds. The Treasury Department sells Treasury Inflation Protected Securities that guarantee you a real return by automatically adjusting the interest rate you earn for inflation. TIPS can be bought for cheap right now because most of the money in financial markets thinks inflation will stay low for years to come. Maybe you're smarter than the market. If so, buy TIPS and laugh all the way to the bank. Don't pay management fees to Michael Aronstein.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.



Blacks Don’t Have a Corporal Punishment Problem

Americans do. But when blacks exhibit the same behaviors as others, it becomes part of a greater black pathology. 

I Bought the Huge iPhone. I’m Already Thinking of Returning It.

Scotland Is Just the Beginning. Expect More Political Earthquakes in Europe.

Lifetime Didn’t Think the Steubenville Rape Case Was Dramatic Enough

So they added a little self-immolation.

Two Damn Good, Very Different Movies About Soldiers Returning From War

Medical Examiner

The Most Terrifying Thing About Ebola 

The disease threatens humanity by preying on humanity.

Students Aren’t Going to College Football Games as Much Anymore, and Schools Are Getting Worried

The Good Wife Is Cynical, Thrilling, and Grown-Up. It’s Also TV’s Best Drama.

  News & Politics
Sept. 19 2014 9:15 PM Chris Christie, Better Than Ever
Business Insider
Sept. 20 2014 6:30 AM The Man Making Bill Gates Richer
Sept. 20 2014 7:27 AM How Do Plants Grow Aboard the International Space Station?
  Double X
The XX Factor
Sept. 19 2014 4:58 PM Steubenville Gets the Lifetime Treatment (And a Cheerleader Erupts Into Flames)
  Slate Plus
Slate Picks
Sept. 19 2014 12:00 PM What Happened at Slate This Week? The Slatest editor tells us to read well-informed skepticism, media criticism, and more.
Brow Beat
Sept. 19 2014 4:48 PM You Should Be Listening to Sbtrkt
Future Tense
Sept. 19 2014 6:31 PM The One Big Problem With the Enormous New iPhone
  Health & Science
Bad Astronomy
Sept. 20 2014 7:00 AM The Shaggy Sun
Sports Nut
Sept. 18 2014 11:42 AM Grandmaster Clash One of the most amazing feats in chess history just happened, and no one noticed.