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Why Passive Investors Lose | Contrarian Investor Michael Green
Description
Contrarian strategist Michael Green lays out why “passive” isn’t passive at all—it’s a flow-driven algorithm, turbocharged by policy, that funnels capital into mega-caps, starves small caps, and raises the odds of market non-clearing shocks.
We unpack Sharpe’s arithmetic vs. rebalancing reality, lessons from Volmageddon, the aging of investor cohorts, why stress may be deflationary before inflationary, and how to “doom-proof” a portfolio with assets that throw off cash (including overlooked duration/TIPS and munis).
Michael also separates crypto’s burn-it-down narrative from its true promise: tokenized, programmable securities that fix TradFi’s paper plumbing.
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TIMESTAMPS
0:00 Intro
4:52 Finance Twitter vs Crypto Twitter
6:42 Fundamentals vs Narrative
9:53 Passive Index Investing
22:12 Message for Passive Investors
28:43 Market Cap vs FDV
30:23 Large Cap Dominance
40:45 Other Distortions
43:40 Volmageddon
50:14 Demographics
55:17 Passive Doom-Proof Portfolio
1:04:15 Currency Collapse
1:09:51 Gold & Precious Metals
1:15:58 Bitcoin vs Gold
1:18:29 Ray Dalio Debt Cycles
1:22:43 Stablecoins & Tokenization
1:28:53 Message to the Listeners
1:34:32 Action Items
1:35:28 Closing & Disclaimers
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RESOURCES
Michael Green
Michael’s Substack
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