I was really humbled to be featured on the Excess Returns podcast in one of their big lessons episodes. In this episode they discuss the 8 big lessons they’ve learned from me over the years. This included:
2:44 Defined Duration Investing – my new asset allocation process by which I focus on quantifying the time horizons over which to use certain instruments and help match them to a financial plan.
12:06 Understanding QE vs Fiscal Stimulus – One of the biggest lessons I learned coming out of the financial crisis and how QE, despite all the hyperinflation predictions at that time, was likely to be deflationary. More importantly, we learned during Covid that big inflation comes from big government spending, not QE.
19:14 International Diversification – I explain how international diversification makes sense as at least a sliver of a portfolio to reduce home bias, domestic economic risk and especially currency risk.
26:52 The Humility of Experience – The older you get the more realize how little you know. Good investors diversify because they know they can’t know everything.
31:15 The Fed as Chuck Norris – The Fed doesn’t have to kick your butt. They just have to threaten to kick your butt and markets behave accordingly.
36:13 Automating Fed Policy – I’d love to see interest rates automated in the future. I don’t know the best way to do it, but I discuss some ideas here.
39:58 Saving vs Investing – We call our investment portfolios the wrong thing. Real investments are made in our income producing skills. We then allocate some of our income into savings like stocks and bonds. Many people get this backwards and think they’re going to get rich in the stock market when the real place you get rich is investing in your own skills.
47:22 Portfolio Goals & Time Horizons – A bit more on Defined Duration concepts and how to compartmentalize and think about portfolio across time.
Watch the whole interview here: