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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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Myrmikan Research 2023 Q1 Investor Letter | Buyside Digest

Back to Fund Profile (Myrmikan Research)

Primary Source Intelligence • Q1 2023 Letter Analysis

Myrmikan Research Quarterly Analysis

Buyside Digest is not affiliated with, and does not endorse, Myrmikan Research. This analysis is provided for institutional research purposes only and is not investment advice.

Fund Returns

Positioning StanceConstructive

GeographyUS

Digest Analysis

Quick Take

"Myrmikan Capital's Daniel Oliver argues the Fed faces an impossible choice between Currency School and Banking School monetary theories, creating systemic banking instability."

Executive Summary

Daniel Oliver of Myrmikan Capital presents a detailed analysis of the fundamental tension between Currency School and Banking School monetary theories currently playing out in U.S. markets. The Fed operates under neo-Banking School thinking, believing real interest rates determine inflation, while simultaneously shrinking the money supply in Currency School fashion. This theoretical confusion has created an impossible situation where the Fed must choose between defending the dollar and supporting a failing banking system. With three of the four largest bank failures in U.S. history occurring since March, regional banks face pressure from fleeing deposits and souring commercial real estate loans. The fractional reserve system is beginning to work in reverse, threatening to decrease asset prices while increasing goods costs. Oliver argues this will lead to crisis management of increasing frequency and intensity, as the Fed lacks intellectual tools to understand the divergent dynamics. He concludes that capital will urgently seek safe-havens, with gold being preeminent, and those who position early will fare best.

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Institutional Meta Strategy

Meta Strategy Gauges

Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.

Signal Matrix

Market Conviction

78%

CautiousHigh

High Conviction (78%)

The manager demonstrates high conviction through his detailed theoretical framework and decisive conclusion about gold positioning. He makes strong, falsifiable claims about banking system failures and monetary policy outcomes. The declarative statement that 'those who get there first will fare the best' regarding gold shows clear conviction, though the lack of specific position sizing caps the score below 0.80.

Growth Outlook

13%

BearishBullish

Bearish (13%)

The manager presents a deeply pessimistic view of the monetary system and banking sector, describing the situation as 'hopeless' and predicting 'crisis management of ever increasing frequency and intensity.' He warns of systemic banking failures and an irreconcilable monetary policy conflict.

Risk Appetite

25%

DefensiveAggressive

Defensive (25%)

While not explicitly detailing current portfolio positioning, the manager advocates for defensive positioning in safe-havens like gold, suggesting a risk-off stance. The emphasis on capital preservation and getting to safety 'first' indicates reduced risk appetite.

Capital Deployment

30%

De-riskingDeploying

De-risking (30%)

While no specific cash levels are provided, the manager's emphasis on capital preservation and seeking safe-havens suggests a defensive posture. The recommendation to position in gold implies some deployment, but the overall tone suggests de-risking from traditional assets.

Forward Guidance

13%

CautiousExpansionary

Cautious (13%)

The manager explicitly states the intention to preserve capital and seek safe-havens with 'ever more urgency.' He recommends positioning in gold as the preeminent safe-haven, indicating a clear defensive deployment bias away from risk assets.

Language Signal

8%

BearishBullish

Bearish (8%)

The language is overwhelmingly bearish with terms like 'crisis,' 'failures,' 'chaos,' 'lethal,' 'hopeless,' and 'systemic risk' dominating the discussion. Very little bullish or opportunity language is present, with the primary positive being gold as a safe-haven.

Perceived Risk

90%

Low RiskElevated

Elevated Risk (90%)

The manager identifies multiple systemic risks including banking system collapse, monetary policy failure, and the Fed's inability to manage conflicting theoretical frameworks. He explicitly warns of 'crisis management of ever increasing frequency and intensity' and describes the situation as fundamentally 'hopeless.'

Opportunity Density

25%

ScarceAbundant

Scarce (25%)

The manager sees very limited opportunities in the current environment, focusing primarily on gold as a safe-haven. The emphasis on the 'hopeless' situation and systemic risks suggests few attractive investment opportunities beyond defensive positioning.

Time Horizon

70%

Short-TermLong-Term

Decade+ (70%)

The manager takes a multi-year view of the monetary system crisis, discussing historical precedents and long-term structural issues. While he expects near-term catalysts like bank failures, his analysis is grounded in longer-term monetary theory and systemic changes that will play out over several years.