source: www.zerohedge.com
by Tyler Durden

It’s official: despite still technically retired in St Barts where he is a “luxury real-estate, mentor, advisor, paddle-surfer” according to his twitter profile, last week’s markets tweetstorm appears to have awoken if not the investing, then at least the analytical “primal urge” in the Scottish investor, who ran the Eclectica macro hedge fund for 15 years until he shuttered it in September 2017 (his farewell letter can be found is here) disgusted with how broken and impossible to navigate capital markets had become as a result of central bank intervention.

And in case it wasn’t clear that after a three year hiatus Hendry suddenly finds himself having much more to say, late on Friday the macro investor followed up last week’s “inaugural” commentary with another massive tweetstorm (Hugh: it may be easier to just write a blog post or alternatively, send it here and we will post it), spanning hundreds of tweets, discussing – in far more whimsical, if typically Hendrian terms – what is arguably the most important concept: when does money printing become inflationary (i.e., the catalyst that will make David Einhorn’s long-term forecast correct).

But first, as a reminder last Friday, Hugh Hendry reverted to his investor roots, discussing the fate of gold and the dollar in the helicopter money regime, what it would take for the S&P to hit 10,000, whether the entire VIX regime is now inverted due to central bank backstops, and asks the “two key questions”: are we transcending from a bull market in fear to a bull market in WTF!? And will QE infinity differ from its previous vintages by driving risk asset volatility levels higher??

Hendry also touches on an old favorite topic, namely hyperinflation, a thesis which he thinks “needs stock prices to fall further and vol to rise in the conventional manner.”  But his most topical observation is what are the core criteria that will allow MMT – i.e., that fusion of the Fed and Treasury known as “helicopter money”…

you can print as many dollars as you damn well please, as long as the yield curve doesn’t steepen and the dollar doesn’t rally precipitously…you’re good to go and MMT is dope.

… as the alternative is game over. As usual, his stream of consciousness answers, right or wrong, were fascinating and could be read in their entirety here.

Fast forward one week later when we got “part two” from the Scottish investor – perhaps best known for his 2010 full-frontal assault on Jeffrey Sachs and the immortal words “I recommend you panic“, when Hendry explained accurately why the current central planning takeover would lead to much more pain in the future…

“Let’s purge this system of its rottenness. Let’s take on a recession. It’s going to be tough, people are gonna lose their jobs. They are going to lose their jobs anyway. We can spread this over 20 years, or we can get rid of it over 3 years.

… something which was clearly correct now that we are 10 years through Hendry’s 20 year forecast, and as we can observe in real time, to keep the system from imploding due to the accumulated “rottenness”, the Fed was forced to inject and backstop a record $12 trillion in just a few short weeks.

READ MORE HERE