Monetary Matters with Jack Farley As Good As It Gets? | Meb Faber on U.S. Stock Valuations, Trend Following, and Endowment Allocations To Private Markets
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Nov 27, 2025 
Meb Faber, founder of Cambria Funds and a quantitative investing expert, dives deep into the current state of the U.S. stock market. He compares today's AI boom to historical bubbles, emphasizing that high valuations can persist. Meb critiques complex investment strategies of major endowments, advocating for simpler ETFs instead. He also shares a little-known tax loophole that allows for tax-deferred stock diversification. His insights on value investing, market trends, and strategic allocations are both enlightening and practical for investors.
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This Run Probably Won't Repeat
- U.S. stocks have delivered an unusually long 15-year run that rarely repeats historically.
- Meb warns against extrapolating those returns and suggests looking where performance lagged.
Don't Just Buy Market-Cap Indexes
- Don't default to market-cap indexing; choose other buckets like value, shareholder yield, or non-U.S. stocks.
- Consider diversifying into asset classes and strategies outside large U.S. tech names.
Multiple Expansion Drove U.S. Leadership
- Much of U.S. outperformance stems from multiple expansion, not just superior earnings growth.
- Foreign and emerging markets show cheaper multiples and rising potential relative to the U.S.
