The Meb Faber Show - Better Investing Richard Bernstein - The Case for Dividends in a Bubble Era | #614
45 snips
Jan 26, 2026 
Richard Bernstein, Chief Investment Officer and founder of Richard Bernstein Advisors, discusses the current market's rampant speculation and narrowness. He emphasizes the attractiveness of dividend-paying stocks and the undervaluation of international stocks. Bernstein argues that crypto represents a global investment bubble and warns about the risks in corporate credit pricing. He advocates for diversification as a defense in today's speculative environment and shares insights on long-term trends like the American Industrialization Renaissance.
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Market Narrowness Hides Broader Opportunity
- The market is extremely narrow with performance concentrated in a few mega-cap names for longer than the tech bubble.
- That narrowness concentrates risk in ~10–25 stocks while the broader market looks more attractive.
Earnings Expectation Life Cycle Guides Timing
- Stocks follow an 'earnings expectation life cycle' moving between despair and euphoria over time.
- Richard uses this cycle to enter sectors that are improving and exit before they become over-loved.
Buy Dividends And Cheap International Stocks
- Do increase exposure to high-quality dividend-paying stocks because speculative markets neglect dividends.
- Do consider non-US stocks which often grow faster, yield more, and trade at 30–50% discounts versus US mega-caps.
