The Meb Faber Show - Better Investing
Owen Lamont on Bubble Fever, Index Gripers & Inefficient Markets | #552
Oct 11, 2024
Owen Lamont, a Portfolio Manager at Acadian Asset Management and former faculty at top universities, dives into the complexities of market bubbles. He discusses the U.S. being in a bubble and the rise of passive investing, pointing out the 'Koreafying' of the stock market. Lamont delves into the impact of AI on finance, the differences in retail investing compared to gambling, and shares insights on closed-end funds. He even draws parallels between Seinfeld and investing, adding a touch of humor to serious topics!
56:01
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Quick takeaways
- Owen Lamont highlights the four indicators of market bubbles: valuation, beliefs, issuance, and inflows, urging vigilance in current evaluations.
- The podcast discusses the shrinking role of IPOs as successful firms increasingly favor private equity routes over public offerings amid high valuations.
Deep dives
The Performance of U.S. Stocks Since 2009
U.S. stocks have experienced remarkable growth over the past 15 years, nearly achieving a tenfold increase since 2009. This significant performance is attributed not only to stock market gains but also to surging corporate earnings during this period. While some investors may interpret these increases as indicators of a potential bubble, key metrics suggest that market valuations, while elevated, do not currently reach the extremes seen during previous market peaks. The discussion raises questions about whether we are truly in a bubble or if strong fundamentals continue to support current stock prices.
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