Excess Returns

Jared Dillian, the contrarian economist behind the Daily Dirt Nap newsletter and host of the Macro Dirt Podcast, dives deep into the current market landscape. He argues that tariffs may actually be deflationary, challenges the notion of a strong dollar in the long run, and shares insights on the shift towards international stocks. Dillian also discusses his unique investment strategy—an 'Awesome Portfolio'—and the risks of protectionism while highlighting the evolving importance of social media in gauging market sentiment.

When we started Excess Returns, we wanted to come up with one way to boil down the best advice from the experts we have interviewed into one simple question. That led us to create a standard closing question that we ask all of our guests, “Based on your experience in the markets, if you could teach one lesson to your average investor, what would that be?”.Over the history of the podcast, we have asked that question to close to 200 guests ranging from great investors to academic experts to options and macro traders. In this episode, we share the answers from our 50 most popular guests all in one episode. Featured guests include Liz Ann Sonders, Cliff Asness, Guy Spier, Michael Mauboussin, Mike Green, Cem Karsan, Chris Davis, Aswath Damodaran, Jack Schwager, Rick Ferri and many others. Topics Covered:The fundamental purpose of investing: preserving and growing wealth rather than getting rich quickThe importance of base rates in investment decisionsPortfolio monitoring frequency and its impact on investment psychologyViewing stocks as ownership in actual businesses rather than trading vehiclesThe value of patience, humility, and self-forgiveness in the investment processDiversification across asset classes, strategies, and time framesThe benefits of simplicity in investment approachesThe psychological challenges of investing and how to overcome themCompounding as a fundamental wealth-building toolThe danger of performance chasing and overconfidenceThe value of a rules-based investment process

In this engaging conversation, Andrew Cohen, a former Goldman Sachs trader turned finance professor, shares his harrowing experience of working at Madoff’s firm and being caught in the largest Ponzi scheme in history. He discusses the intense trading culture and the advanced technology of the era, as well as his interactions with Madoff's sons. Andrew reflects on the trauma of losing everything and the journey to rebuild his life in academia, offering valuable lessons on risk management and the importance of ethics in finance.

Richard Bernstein, CEO and Chief Investment Officer of Richard Bernstein Advisors, shares his insights on today's economic challenges. He discusses the alarming narrowness of recent markets, dubbing it the most constricted since the Great Depression. Bernstein highlights the negative consumer impact of tariffs and argues for a shift towards value investing. He expresses skepticism about cryptocurrencies and critiques the limitations of index funds. Additionally, he emphasizes gold's role as a hedge against uncertainty and advises sticking to fundamentals for long-term wealth.

Jim Paulsen, Chief Investment Strategist at Paulsen Perspectives, shares his decades of expertise on navigating turbulent markets. He discusses how tariffs may not be as inflationary as believed and suggests a weaker dollar could enhance trade competitiveness. Paulsen critiques Federal Reserve policies for their inaction amid deflation risks and emphasizes the importance of emotional discipline for investors. He highlights the resilience of the private sector and offers practical investment strategies, focusing on long-term thinking amidst current market volatility.

Join investment expert Chris Mayer, author of '100 Baggers,' and co-host Bogumil Baranowski as they uncover the secrets to finding future 100-bagger stocks. They dive into the role of AI in investment opportunities and the critical mindset for thriving amidst market volatility. Explore the merits of concentrated investing, the influence of CEOs on company performance, and timeless principles that emphasize patience and a long-term approach. This conversation is packed with valuable insights for both seasoned investors and newcomers.

Rick Ferri, a champion of low-cost, evidence-based investing, shares his expertise on navigating market volatility. He emphasizes the power of simplicity in investing and the importance of maintaining a steady asset allocation. Ferri debunks the myth of the 'dead' 60/40 portfolio and highlights the significance of personal inflation rates. He also discusses the complexities of direct indexing, the challenges of active management, and the benefits of international diversification. This conversation offers essential strategies for both novice and seasoned investors.

Andy Constan, founder of Damped Spring Advisors, shares insights on the U.S. economy's precarious path. He introduces his 'Island Framework,' showcasing the shift from 'Higher for Longer Island' to 'Recession Island.' Andy discusses the influence of Trump and Powell's policies on market dynamics, emphasizing why bonds may outperform stocks now. He also delves into the implications of tariffs and national debt, as well as long-term inflation drivers like demographics and deglobalization's impact—offering a thorough analysis for investors navigating today's volatile landscape.

Cullen Roche, a renowned financial expert from Discipline Funds, shares his insights on the economy and markets. He challenges the idea of a soft economic landing, emphasizing the complexities involved. Cullen dives into the effects of tariffs as corporate taxes and their inflationary potential. He assesses the national debt's risks while addressing government spending implications. Furthermore, he critiques the bond market's sophistication and discusses how AI technologies are reshaping productivity within corporations.

Lindsey Bell, Chief Market Strategist at Clearnomics, and Shannon Saccocia, Chief Investment Officer at Neuberger Berman, discuss navigating market volatility and economic uncertainties. They analyze the impact of tariffs on business decisions and economic growth, highlighting consumer resilience amid evolving spending patterns. Predictions for GDP growth are examined, alongside the Federal Reserve's balancing act between inflation and growth. They also explore opportunities beyond tech stocks and emphasize the importance of international investments for broader portfolio stability.