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In this morning’s edition of The Macro Show, Hedgeye Demography analyst Neil Howe explains how the rise of passive investing, aside from its positive impacts (especially for retail investors) has very real negative consequences for the financial economy and for competitive capitalism.

"Active investors have two options:
1) Get out of public markets and into private, or
2) Front run The #Machine (indexers & the Street).

The rise of passive investing has changed the environment dramatically," explains Howe, as he fleshes out how the game has changed and how the massive influx of passive may be lead ingto monopolistic & anticompetitive practices.

“Keith talks about the #Machine in a very realistic way – it doesn’t matter if it makes sense or not, you just can’t afford to get run over by it.”