Financial expert Richard Bernstein joins Michael Batnick and Downtown Josh Brown to discuss the magnificent 7 compared to past bubbles, bitcoin as a sentiment indicator, the Fed's predicament, the case for international stocks, and more!
De-globalization could lead to higher inflation and interest rates as countries become more self-sufficient and reduce competition.
Emerging markets may offer better investment opportunities due to the relationship between venture capital and emerging markets, as well as the potential for positive surprises in earnings growth.
Investors should focus on the fundamentals of the economy and the potential impact of policies rather than getting caught up in political noise and should consider relative valuations and potential opportunities in sectors such as industrials, materials, and emerging markets.
Deep dives
The potential impact of de-globalization on inflation and interest rates
De-globalization could lead to higher inflation and interest rates as countries become more self-sufficient and reduce competition.
The potential for emerging markets to outperform the US
Emerging markets may offer better investment opportunities due to the relationship between venture capital and emerging markets, as well as the potential for positive surprises in earnings growth.
The importance of separating politics from investment decisions
Investors should focus on the fundamentals of the economy and the potential impact of policies rather than getting caught up in political noise. Politics can influence markets, but long-term economic trends and company performance should be the primary drivers of investment decisions.
The need to assess relative valuations and sector opportunities
Investors should consider the relative valuations and potential opportunities in sectors such as industrials, materials, and emerging markets, which may benefit from de-globalization and infrastructure investments.
The Impact of Monetary Policy on the Post-Pandemic Economy
The podcast discusses how the monetary policy response to the pandemic has led to significant money growth and its potential consequences. The speaker believes that it will take a long time for this excess money growth to be washed out of the system and that it will have wide-ranging effects on evaluations and consumer behavior. They also highlight the unconventional nature of the current monetary policy response and the potential unpredictability of its lags.
Challenges and Opportunities in Investing in China
The podcast explores the challenges and opportunities of investing in China. The speaker, while acknowledging the political and regulatory complexities in the country, emphasizes the importance of differentiating between the stock market and the underlying fundamentals. They suggest that despite certain limitations and recent policy changes, the macro fundamentals in China seem promising. They also point out the increasing interest from European financial advisors and institutions in investing in China, highlighting the potential growth opportunities.
On episode 130 of The Compound and Friends, Michael Batnick and Downtown Josh Brown are joined by Richard Bernstein to discuss: the magnificent 7 compared to past bubbles, bitcoin as a sentiment indicator, the Fed's predicament, the case for international stocks, and much more!
Thanks to Carta for sponsoring this episode. See how Carta can simplify your equity plan management today by going to carta.com/compound.
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