Vincent Daniel & Porter Collins: How Seawolf (Capital) Navigates Choppy Markets

**Danny Moses** (0:02)
Welcome to the On The Tape Podcast. I'm your host Danny Moses, and today I welcome back my boys, Porter Collins and Vincent Daniel to the pod. They were last on on March 31st, and since we try and do this on a quarterly basis, the timing is perfect for many reasons. We are beginning the second quarter earning season. We have an on again, off again war with Iran. We have a new head at the Federal Reserve. We testified for Congress today amidst renewed concerns about inflation, and the markets are still obsessed with all things AI as it continues to be the driver for equities. And much better than just giving you my Kalshi picks of the week at the end of the episode, we integrate several Kalshi contracts into our discussion. So please enjoy my conversation with Porter and Vinnie.
Boys, great to have you back on. For those listeners and viewers out there who don't know, the three of us launched the What Are We Doing Contrarians at the Gate Substack almost a year ago, which includes a written piece almost every week, as well as the Friday Night Dirty Podcast. We also created a Discord channel for paid subs, where there's incredible content being shared every day. And at the end of this episode, we're going to give out a link, which you will also be able to find in the show notes for a free 30 day trial for On The Tape listeners to our Substack as well. And also just to remind people, we did launch Seawolf Capital in late 2011 and returned to outside money in 2017
But Porter and Vinnie now run Seawolf Capital really as a family office and they're actively trading and they share those ideas obviously on our Substack as well. Boys, welcome back to the pod.

**Porter Collins** (1:31)
Great to be back.

**Vincent Daniel** (1:32)
Thanks for having us.

**Danny Moses** (1:33)
All right. Well, I always look forward to this. I know we talk almost every day, but it's always great to have you in this format. And let's just get right into it. So at the end of the day, the market's obsessed really with two things. The AI, you know, capex and all that stuff and the Fed. And some of those times, those things meet in the middle, but those are two separate issues. But let's start kind of with the Fed and interest rates because we got whatever the Thompson-Twins, Porter, that Dr. Dr. Print was this morning on the CPI.
But let's start with that because that seems to be a big driver here of the markets and get your guys' thoughts on the Fed.

**Porter Collins** (2:09)
Well, obviously, you know, we've, because we traded financial services, we've had to really study the Fed and study its actions pretty intently for, you know, a better part of two decades. And, you know, it occurred, it seems to me that the Fed is in a box right now, right? They, inflation is obviously hot, although it's cooling down.
And at the same time, interest expense as a percent of overall tax receipts is, keeps getting larger. So they're sort of, they painted themselves into it, the Fed and the government sort of painted themselves into a corner. So I don't think they can afford higher rates and really fight inflation anyway, but they can make up any CPI print they want to, obviously. But in my mind, there's two sets of inflation things they need to balance. One is housing markets, which is in the doldrums right now. And I would argue that that part of the, they call it shelter. I think it's almost 45% of the CPI, the way they calculate it, is low, very low right now, and probably negative in some places. And then there's the other part of, which is attached to everything, kind of attached to the war on oil, which is obviously high right now. So that's, I'm of two minds, but I, you know, we can go into what I think the Fed's gonna do, but we'll let Vin go ahead.

**Danny Moses** (3:36)
We're getting into that. And Vinny, when you were, when you were last, you guys were last on, you and I kind of shared the same, I don't care what they think about worse. Any excuse to be dovish feels like the Fed will run with that. But give me, give me your thoughts here, coming out of the last few days here, both testimony and the data that we've been seeing recently.

**Vincent Daniel** (3:54)
Well, let's, let's break it down into short-term, long-term and what worse needs, right? We'll start with the basics. The most important thing he needs is he needs for our country to have a lower cost of capital so we could adequately service the debt at a low price, right? So then you got to figure out, well, how is he going to go about doing that?