The David Lin Report 1950s-Style Boom: Why These Stocks Will Beat S&P 500 This Decade | Thomas Hayes
Jul 2, 2025
Thomas Hayes, Founder and Chairman of Great Hill Capital, shares his insights on the financial landscape. He talks about Trump's fiscal stimulus bill and how it might steer small-cap stocks ahead of large tech giants this decade. Hayes predicts significant opportunities in lesser-known stocks that could outshine the MAG-7 due to shifts in earnings growth. He also delves into the changing consumer spending patterns, suggesting that rising credit availability could positively affect the economy, making the case for strategic investments in consumer stocks.
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Stimulus to Boost GDP Growth
- Trump's fiscal stimulus bill is designed to run nominal GDP growth hotter than in decades, similar to 1950s post-WW2 growth strategies.
- This approach aims to reduce the debt-to-GDP ratio from 120% to 60% through sustained growth and moderate inflation around 3%.
Criticism of Powell's Fed Policy
- Jerome Powell’s approach to inflation and interest rates is seen as rigid and historically uninformed according to Thomas Hayes.
- Hayes believes inflation must be higher to reduce debt burdens, and current policy hinders economic growth and burdens taxpayers unnecessarily.
Prepare for Bond Yield Drop
- Expect a reduction in the 10-year Treasury yield due to changes in bank capital requirements and bond operations slated for implementation in the next three months.
- Lower mortgage rates under six percent will likely stimulate housing demand and create investment opportunities in related sectors like building suppliers.