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Excess Returns

Excess Returns

Excess Returns is dedicated to making you a better long-term investor and making complex investing topics understandable. Join Jack Forehand, Justin Carbonneau and Matt Zeigler as they sit down with some of the most interesting names in finance to discuss topics like macroeconomics, value investing, factor investing, and more. Subscribe to learn along with us.

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  • 45 episodes
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  • Yesterday · 1 hr 5 min

    Tom Maher on Small-Cap Investing, AI Infrastructure and Opportunities Beyond Big Tech

    Tom Maher of Hilton Capital Management explains what is changing for small-cap stocks as earnings improve and AI spending reaches beyond big tech. After years of justified large-cap leadership, he sees reasons to revisit smaller companies while remaining selective about business quality, financing needs and valuation. In this episode of Excess Returns, we explore the physical infrastructure behind AI, the case for diversifying beyond the largest stocks, and how Tom Maher finds businesses with improving fundamentals. We also discuss the effects of passive investing, opportunities in reshoring, and why knowing more about a company does not always lead to a better investment decision. Topics covered: Why stronger earnings helped justify large-cap leadership and what could change that balance How AI construction and equipment spending can benefit smaller industrial companies Why some small companies grow into large caps while others remain small Self-funding businesses versus companies that depend on outside capital Unprofitable index constituents, private equity and the changing IPO market How interest rates affect financing costs, valuations and portfolio decisions Why ETF flows can move a stock independently of its business fundamentals Finding improving businesses without mistaking a low valuation for an opportunity Evaluating management incentives, consistency and acquisition decisions Tom Maher's lessons on taking partial profits and reading unexpected stock-price reactions Learn more about Hilton Capital Management. Chapters: 00:00 Tom Maher's outlook: earnings, valuations and risk 05:26 Small-cap earnings and AI infrastructure spending 11:41 Defining small caps and why some companies stay small 16:45 Active management and business quality 22:03 Small-cap index quality and companies staying private 27:15 Combining stock selection with a macro view 32:58 Higher interest rates and portfolio decisions 37:04 Passive investing and ETF-driven stock moves 41:33 Finding stocks with improving fundamentals 51:13 Valuation, consistency and management quality 56:39 Reshoring and the industrial recovery 01:01:14 Research, profit-taking and investor expectations Learn more about the Excess Returns podcast network. No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • S1 · E490
    Sunday · 59 min

    Ed Yardeni Still Sees S&P 10,000 by 2029. So Why Is He Getting More Cautious?

    Ed Yardeni of Yardeni Research explains why he still sees the S&P 500 reaching 10,000 by 2029, even as higher oil prices and bond yields make him more cautious near term. His destination hasn't changed, but the timetable has: he has pushed his 8,400 target to mid-2027 while retaining his Roaring 2020s outlook. In this conversation with Justin Carbonneau and Jack Forehand, Ed distinguishes an earnings-led bull market from a speculative melt-up, explains why retiring baby boomers keep spending, and makes the case for AI's benefits spreading beyond the Magnificent Seven. He also weighs the return of the bond vigilantes, diesel's inflation impact, global diversification and the risks that could challenge his optimistic base case. Topics covered: Ed Yardeni's FEMO: fabulous earnings momentum versus fear of missing out Why strong earnings can support stocks even as valuation multiples fall The assumptions behind Ed Yardeni's S&P 500 target of 10,000 by 2029 Retiree wealth, consumer spending and Ed Yardeni's G-shaped economy AI, productivity and data as a fourth factor of production Why Ed Yardeni favors the “impressive 493” as potential AI beneficiaries Cloud revenue, compute demand and the returns on AI capital spending Bond vigilantes, fiscal deficits and the difference between growth-driven yields and a debt crisis How diesel costs could feed into core inflation Global diversification and the bond market's role in guiding Fed policy Chapters: 00:00 Ed Yardeni's bull case and near-term caution 04:26 The Roaring 2020s and retiree spending 08:53 Technology and the productivity thesis 13:06 AI, economic growth and data as a resource 18:22 Why the economy is more than AI spending 24:10 AI returns and the impressive 493 29:48 Valuations, S&P 10,000 and rising bond yields 38:42 Government debt and demand for Treasuries 43:34 Diesel inflation and global diversification 47:41 Fed policy and signals from the bond market 51:55 Yardeni Research's process and tools 56:19 Why Ed Yardeni favors a G-shaped economy Learn more about the Excess Returns podcast network: https://excessreturns.co

  • Saturday · 56 min

    The 10-Year Hit a 24-Year High. Nobody Is Buying Puts. Are You Watching the Wrong Market?

    Andy Constan, Brent Kochuba and Eric Pachman examine rising bond yields, options positioning and the inflation risks facing stocks. What happens if the rate relief traders are betting on never arrives? On this month's Last Call, Jack Forehand and Matt Zeigler connect three perspectives on the market. Andy Constan explains why stronger growth and debt supply can push yields higher without signaling a bond crisis. Brent Kochuba examines options flows that suggest traders are still leaning toward a rebound. Eric Pachman traces the path from refinery constraints and diesel shortages to freight costs and consumer inflation. Jack and Matt close with the investment implications of AI spending, efficiency and adoption. Follow Last Call on Spotify⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠Follow Last Call on Apple Podcasts⁠ Topics covered: Andy Constan on growth, AI capital spending and the supply of debt Why Andy Constan sees more attractive bonds without calling for a recession How higher yields can constrain stock returns even when growth remains strong Brent Kochuba on bond volatility, calm equities and bets on falling yields Why Brent Kochuba is watching both upside surprises and downside risk Eric Pachman on crack spreads and why cheaper crude may not mean cheaper fuel How diesel prices can flow through freight bills into CPI Eric Pachman on wage inequality and what national averages miss AI spending, productivity and the difference between slower growth and contraction The practical obstacles to bringing AI agents into everyday life Chapters:00:00 Rising yields and the outlook for stocks05:26 Andy Constan: Growth, debt supply and higher yields12:01 Why bonds look more attractive after the selloff18:33 Brent Kochuba: Options flows and bets on rate relief23:21 Equity complacency and risks in both directions31:12 Eric Pachman: Diesel shortages, crack spreads and inflation40:06 Wage inequality and the limits of average inflation44:40 AI capital spending, productivity and investment returns50:34 AI adoption, automation and everyday obstacles Learn more about the Excess Returns podcast network:⁠https://excessreturns.co⁠ No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • S1 · E489
    October 1 · 1 hr 2 min

    They Beat All US Stock Funds Since 2003 | Michael Baron on the AI Winners Investors Miss

    Michael Baron of Baron Capital explains his case for AI beneficiaries beyond the biggest tech stocks, including software companies the market fears will be disrupted. He joins Matt Zeigler and Justin Carbonneau to discuss how competitive advantages, management quality, and a long investment horizon shape the firm's growth portfolios. Baron Capital's co-president and portfolio manager walks through the firm's investments in Tesla and SpaceX, from vertical integration and autonomous driving to reusable rockets, Starlink, and the potential for AI infrastructure in space. He also explains why proprietary data may strengthen some software businesses, how the firm manages positions as winners grow, and what would make him sell. The conversation closes with lessons from Ron Baron on curiosity, primary research, and building conviction. Topics covered: Finding growth opportunities across technology, financial services, real estate, and consumer businesses Why Michael Baron believes some apparent AI losers could become beneficiaries Proprietary data and the investment cases for Shopify, Guidewire, FactSet, MSCI, and Gartner Tesla's evolution, energy business, and the potential economics of autonomy and software SpaceX's reusable rockets, Starlink, and Michael Baron's vision for AI infrastructure in space Valuing businesses over a long horizon and assessing reliance on key leaders Lessons from Ron Baron and the importance of management relationships during market stress Letting winners run while managing concentration, leverage, and portfolio correlations Distinguishing portfolio trims from selling when a competitive advantage deteriorates Why Michael Baron believes AI will increase the importance of investment judgment Learn more about Baron Capital: https://www.baroncapitalgroup.com/ Chapters: 00:00 Michael Baron on finding growth beyond technology 04:16 AI disruption and the opportunity in software 10:54 Tesla, Elon Musk, and vertical integration 18:33 Long-term valuation and key-person risk 23:28 SpaceX, Starlink, and AI infrastructure in space 34:11 Lessons from Ron Baron and the firm's future 40:08 Evaluating management and competitive advantages 47:11 Time as an edge and managing growing positions 54:11 When to trim a position and when to sell 58:11 Curiosity, primary research, and conviction Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • September 29 · 50 min

    The Game Was Rigged in Their Favor. 28% Went Bust Anyway | Kris Abdelmessih on How to Size Bets

    How much of your portfolio does a good investment idea deserve? Kris Abdelmessih of Moontower joins Matt Zeigler to explain why having an edge is only part of the decision: position size can determine whether favorable odds translate into long-term growth or damaging losses. Through a coin-flipping experiment and everyday examples, Kris makes the Kelly Criterion accessible without a complicated derivation. The conversation explores the difference between expected returns and compounded wealth, why growth-maximizing bets can still be uncomfortable, and how uncertain probabilities make a case for betting less. From portfolio decisions to insurance and extended warranties, the goal is to build better intuition about how much risk to take. Topics covered: How a favorable coin-flipping game exposed costly mistakes in bet sizing Why maximizing the expected payoff of one bet differs from maximizing long-term compounded growth How oversized bets can undermine an otherwise profitable opportunity The Kelly Criterion's three inputs: probability of winning, probability of losing, and payoff Why a constant percentage of your bankroll means changing the dollar amount after wins and losses How different payoffs change the appropriate size of a bet Applying the framework to hypothetical self-insurance and extended-warranty decisions Why full Kelly can involve substantial drawdowns, and the tradeoffs of fractional Kelly Working backward from a position size to the odds needed to justify it Allowing for uncertainty in your estimates and preserving capital for future opportunities The essay behind this conversation: After this post you will be sizing bets in your head https://www.panoptica.com/after-this-post-you-will-be-sizing-bets-in-your-head/ Research discussed: Rational Decision-Making Under Uncertainty: Observed Betting Patterns on a Biased Coin https://arxiv.org/abs/1701.01427 Kris Abdelmessih's Moontower newsletter: https://moontower.substack.com/ Moontower: https://moontower.ai/ Kris Abdelmessih on X: https://x.com/KrisAbdelmessih Chapters: 00:00 Position sizing and the favorable coin-flip experiment 04:45 Why a good bet can produce bad outcomes 13:49 The Kelly Criterion formula explained 18:10 Adjusting your bankroll and accounting for the payoff 23:03 Applying Kelly to a self-insurance decision 30:25 Full Kelly, drawdowns, and reasons to bet less 34:59 Working backward from bet size and evaluating warranties 41:09 Volatility drag, uncertain odds, and the experiment's results 46:09 How much capital does your edge deserve? Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • S1 · E488
    September 26 · 1 hr 13 min

    We Asked the Data Journalist Who Rebuilt the Jobs Report What the Headline Number Hides

    What are headline jobs and inflation numbers missing about the economy investors actually face? Eric Pachman of Data 4 The People joins Matt Zeigler to examine how a changing workforce, rising fuel costs, and differences in household spending could affect inflation, consumer demand, and corporate margins. Using interactive data tools, Eric looks beneath monthly payroll reports, maps changes in America's labor force, and traces how diesel prices can work their way into retail prices. He also shares a grocery-price study that challenged his own assumptions about CPI and explains how he is using AI to make rigorous data journalism more accessible. Topics covered: Why monthly jobs reports need context, including survey uncertainty and revisions How to spot unusual industry-level payroll changes and assess the quality of jobs added What county-level labor force trends reveal about aging and rural America Eric Pachman's research on foreign-born workers and the limits of replacement assumptions How a shrinking supply of workers could create pressure on service prices How diesel costs flow through freight surcharges, retailer margins, and consumer prices What to watch for in retailer earnings calls as companies weigh price increases Why household income, driving habits, and spending patterns change the experience of inflation What Eric Pachman's Kroger study found about CPI, the Thrifty Food Plan, and store brands Using AI to test assumptions and expand access to data journalism Explore Eric Pachman's research and interactive tools: https://www.data4thepeople.com/ The Men Who Vanished: Testing Labor Market Displacement https://www.data4thepeople.com/p/the-men-who-vanished How do the government's grocery prices stack up against the real ones? https://www.data4thepeople.com/p/kroger-shelf-vs-cpi-thrifty-food-plan/ Chapters: 00:00 Introduction and Data 4 The People's mission 09:20 Spotting unusual changes in the jobs data 18:27 Mapping America's changing labor force 27:00 Foreign-born workers, aging, and labor supply 34:51 Energy costs and the path to consumer inflation 47:49 Why your inflation experience differs from CPI 56:12 Personal inflation tools and testing grocery prices 1:02:36 AI, data journalism, and challenging your own bias 1:11:17 Where to find Eric Pachman's work and tools Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • S1 · E487
    September 23 · 59 min

    He Lost $157,000 in 3 Minutes | Jack Raines on the Lesson Winning Never Taught Him

    Jack Raines turned $6,000 into roughly $400,000 trading SPACs, then lost $157,000 in three minutes after taking a very different bet. The author of Young Money joins Matt Zeigler to discuss what that experience taught him about investing risk, the urge to chase more, and the time a growing portfolio can cost you. The conversation follows Jack Raines from SPAC warrants and market narratives to a broader question: how do you allocate money, time, and risk to build a life you actually want? They explore the limits of a trading edge, why cheap stocks can get cheaper, and how debt, career choices, and status shape the decisions investors make beyond their portfolios. Young Money: A Field Guide to Wealth and Purpose in Your Twenties https://amzn.to/4AtUsDoJack Raines' Young Money newsletter https://www.youngmoney.co/ Jack Raines on X https://twitter.com/Jack_Raines Topics covered: How Jack Raines grew his Roth IRA through SPAC warrants and pre-merger common shares, and why those positions carried different risks. Why an edge in one corner of the market did not translate into a successful concentrated earnings bet. How a million-dollar target and constant account checking changed Jack Raines' relationship with money and time. What SEC filings, Discord research, and market narratives contributed to his trading process. Why Jack Raines bought Figma after questioning the market's AI narrative and speaking with designers. Applying portfolio thinking to careers, creative projects, and opportunities that change with each stage of life. Weighing retirement saving against other opportunities, and why Jack Raines treats expensive debt as a constraint on taking risks. Escaping the "someday" trap while giving long-term venture investments time to develop. Combining steady income and index funds with independent bets, while treating status as a tool rather than a goal. Why Jack Raines believes investors learn about risk through experience, with stakes they can afford to recover from. Timestamps: 00:00 Jack Raines on the lessons of losing money 04:57 Inside the SPAC trades and the $157,000 loss 15:16 Separating market hype from downside math 22:18 Building a life with portfolio principles 29:45 Retirement saving, trading obsession, and the cost of time 36:56 Debt, freedom, and the trap of waiting for someday 44:33 Venture investing: acting quickly and waiting patiently 51:03 Using status without making it the goal 56:08 The investing lesson experience has to teach Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • S1 · E486
    September 20 · 55 min

    The AI Gap Is Closing | Jason Hsu on China, Momentum Crashes and the S&P’s Seven-Stock Bet

    Jason Hsu, founder and CIO of Rayliant Global Advisors and co-founder of Research Affiliates, joins Excess Returns to discuss the US-China AI race, the economics of AI spending, and what market concentration means for investors. We explore China's energy and open source advantages, opportunities in Chinese stocks, and how factor investing and machine learning can help build more diversified portfolios. Rayliant Global Advisors https://rayliant.com Rayliant on X https://twitter.com/rayliant Topics covered: Why Jason believes AI safety requires cooperation between the US and China How Chinese AI models are closing the gap with US developers China's electricity infrastructure and the competitive threat from open source AI Where AI profits could accrue across hardware, energy, models and applications How chip restrictions are encouraging China to develop domestic capabilities Why retail trading creates opportunities and challenges for factor investors in China Chinese technology companies, dividend-paying state enterprises and US-China trade The AI spending arms race and the concentration risk facing S&P 500 investors Momentum crashes, value cycles and how Rayliant uses machine learning to combine factors Why advisors' greatest contribution may be helping clients find meaning in their wealth Timestamps: 00:00 Jason Hsu on AI competition and safety 04:00 How close are Chinese AI models to the US? 08:25 China's energy advantage and open source economics 14:12 Who captures AI profits, and can China catch up in chips? 18:41 Chinese stocks, retail trading and speculation 24:01 China's overlooked opportunities and dividend stocks 28:05 US-China interdependence and the AI spending arms race 33:24 The AI concentration hiding in the S&P 500 37:25 Momentum crashes, value cycles and factor performance 41:54 Machine learning and building multifactor portfolios 48:46 Financial advisors, Jack Bogle and having enough 53:23 Why inefficient markets do not make alpha easy Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • S1 · E485
    September 18 · 1 hr 1 min

    David Rosenberg on Why He Wants the Bonds Everyone Hates — and Where He's Hiding in Stocks

    David Rosenberg returns to Excess Returns to explain his bullish case for Treasury bonds, why he expects inflation and economic growth to slow, and the risks he sees in an AI-driven stock market. The Rosenberg Research founder joins Matt Zeigler to discuss consumer spending, Federal Reserve policy, gold, international stocks, and how he translates his economic outlook into a diversified portfolio. Recorded September 16, 2026, before the Federal Reserve's policy announcement. David Rosenberg on Twitter https://twitter.com/EconguyRosie Rosenberg Research https://www.rosenbergresearch.com/ Topics covered: Why Rosenberg believes markets have priced in too much Fed tightening and Treasury bonds offer an opportunity Why he views higher oil prices as a tax on consumers rather than evidence of sustained, broad-based inflation How slowing wage growth, falling savings, and the stock market wealth effect shape consumer spending How Treasury issuance changes and potential post-election fiscal gridlock could support bonds Why AI exposure extends beyond technology stocks into utilities, industrials, and other sectors Where he sees opportunities in healthcare, consumer staples, pipelines, European stocks, and Asia His model portfolio's allocation to equities, bonds, cash, and commodities How gold, central bank buying, and a bearish dollar outlook fit his investment thesis Why he is positioning for slower growth without making recession his base case What working with portfolio managers taught him about cutting losses and separating conviction from stubbornness Timestamps: 00:00 Rosenberg's portfolio approach and the Treasury opportunity 05:58 Why an oil shock can weaken consumer spending 10:52 Jobs, wages, and the stock market wealth effect 17:35 Fiscal stimulus, Treasury issuance, and the bond outlook 22:53 AI concentration risk beyond technology stocks 27:10 Why he owns European and Asian equities 31:16 Inside his 50% stocks, 30% bonds model portfolio 36:43 Betting against the inflation consensus 42:41 Gold, central bank reserves, and a weaker dollar 48:56 Recession watch and bear market risks for 2027 53:10 AI correlations and the risks of being fully invested 58:27 Cutting losses and knowing when conviction becomes stubbornness Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • S1 · E484
    September 16 · 55 min

    Franklin Templeton CEO Jenny Johnson on AI, Private Markets, and the Hidden Risks in Index Funds

    Franklin Templeton CEO Jenny Johnson joins Matt Zeigler to explore how AI, blockchain tokenization, and private markets are reshaping investing and asset management. They discuss what these changes mean for individual investors, from personalized portfolios and access to private companies to the concentration risks hiding in passive index funds. Jenny also shares lessons from her journey from intern to CEO, why financial advisors still matter, and why starting early remains her most important investing lesson. Franklin Templeton https://www.franklintempleton.com Topics covered: Why AI could create new industries and why learning to use it matters for young professionals How Franklin Templeton uses AI agents and why investment decisions still require human judgment Building personalized portfolios around retirement, college savings, and other financial goals How blockchain, smart contracts, and instant settlement could reduce financial transaction costs Tokenized money market funds, digital wallets, and the obstacles to bringing ETFs on-chain Why companies stay private longer and what investors miss when they only own public stocks Private credit, illiquidity, and the trade-offs involved in expanding access to private markets How mega IPOs, AI spending, and changing index composition can increase portfolio concentration Balancing shareholders, employees, and clients while investing in a company's long-term future The value of financial advisors, staying invested, and giving compounding time to work Timestamps: 00:00 Jenny Johnson's leadership lessons and path from intern to CEO 06:41 AI job disruption and lessons from earlier technology revolutions 10:42 How young analysts use AI and where personalized investing is heading 15:44 Human judgment, AI agents, and the future of asset management 20:17 How tokenization could lower costs and expand financial access 24:39 Why blockchain adoption is slow and how tokenized ETFs work 29:58 Private company growth, investor access, and liquidity trade-offs 35:20 Mega IPOs, index concentration, and the risks of AI spending 41:23 Franklin Templeton's family legacy and investing for the next generation 46:18 Why financial advisors matter and why investors should start early 51:32 Jenny's hands-on experiments with AI tools Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • September 14 · 1 hr 1 min

    Jim Paulsen on the Weakening Economy, Tech Bear Market Risk and the Bull Market Built on Fear

    Jim Paulsen joins Jack Forehand and Matt Zeigler on the latest Jim Paulsen Show to explore why booming AI earnings may be masking a weakening U.S. economy, and what that means for stocks, bonds, and Federal Reserve policy. Using 27 charts, he examines stalled job creation, rising oil prices, growing reliance on debt to finance AI investment, and why he expects a sharper correction in technology than in the broader S&P 500. ⁠Subscribe to the Jim Paulsen Show on Spotify⁠⁠⁠⁠ ⁠⁠⁠⁠Subscribe to the Jim Paulsen Show on Apple Podcasts Topics covered: Why strong S&P 500 earnings hide a widening divide between technology, energy, and the remaining seven sectors. Why low unemployment claims may offer false comfort when job creation has stalled. Jim's job market misery index and what it suggests about the case for Fed easing. How business investment and employment have broken their historical relationship. Why weak real disposable income, low savings, and higher oil prices threaten consumer spending. How fading economic momentum could push Treasury yields lower despite renewed inflation fears. Why a shrinking wall of worry could remove an important source of support for stocks. What growth stock leadership, household purchasing power, and ISM services data reveal about market risk. How debt-funded AI spending and widening credit spreads change the risks facing technology companies. Why extreme stock outperformance versus bonds could matter for portfolio allocation. The difference between rising profits per worker and sustainable economic productivity. Why Jim expects a tech bear market but a more moderate correction in the broader S&P 500. Timestamps: 00:00 Why oil, rates, and tight policy worry Jim 05:43 The three-way split hiding beneath strong earnings 09:58 Why low jobless claims may be misleading 16:18 When business investment stops creating jobs 20:48 Can consumer spending outrun real income? 26:01 How the wall of worry has supported stocks 31:44 Investor complacency and a shift toward growth fears 36:58 The disconnect between Main Street and Wall Street 41:35 AI debt financing, credit spreads, and the case for bonds 47:25 Investment per worker and the yield curve's earnings warning 51:52 Profit productivity versus real economic productivity 58:08 Why Jim expects a tech bear market and a broader correction Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • S1 · E483
    September 12 · 1 hr

    We Asked Fidelity's Ex-President What Made Peter Lynch Great — and Where Private Credit Risk Hides

    Former Fidelity president and MFS chairman Bob Pozen joins Excess Returns to discuss retirement investing, the risks in private credit, and why he favors a 90% stock and 10% cash portfolio for investors who can cover their living expenses without selling stocks. Drawing on decades in asset management, he shares lessons from Peter Lynch and Warren Buffett, explains why index funds are difficult to beat, and challenges conventional thinking about bonds, Social Security, and corporate earnings reporting. Bob Pozen's website https://www.bobpozen.com Follow Bob Pozen on Twitter https://x.com/Pozen Research discussed: Consequences of Mandatory Quarterly Reporting: The U.K. Experience https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2817120 Rating Without Market Discipline https://papers.ssrn.com/sol3/papers.cfm?abstract_id=6859158 Giving Life to Private (Rated) Credit https://papers.ssrn.com/sol3/papers.cfm?abstract_id=6857958 Topics covered: What investors misunderstand about Peter Lynch and how fund liquidity shaped his approach versus Warren Buffett's. Lessons from leading Fidelity and rebuilding investor trust at MFS after its trading scandal. Why fees, fund size, and market efficiency make large-cap index funds difficult to beat. Private equity in 401(k) plans, liquidity constraints, and the problem with instant valuation markups. How private credit ratings and affiliated investments can obscure risks on insurance company balance sheets. Pozen's proposals for Social Security reform and the consequences of postponing difficult decisions. How automatic IRA enrollment could expand retirement savings access for workers without employer plans. Why Pozen favors a 90/10 portfolio for certain investors and how spending needs and inheritance goals affect allocation. Why quarterly financial reporting and quarterly earnings guidance deserve different treatment. The behavioral cost of chasing rallies and selling downturns, plus Pozen's work on AI and personal productivity. Timestamps: 00:00 Peter Lynch, Warren Buffett, and staying the course 05:27 Leading Fidelity and keeping stock funds invested 11:03 Rebuilding trust at MFS after the trading scandal 16:01 Why active managers struggle to beat index funds 20:03 Private equity in 401(k)s and valuation concerns 24:45 Private credit ratings and insurance company risks 29:33 Regulatory gaps and affiliated insurance investments 35:51 Social Security reform and the cost of waiting 40:00 Automatic IRAs for workers without retirement plans 44:09 The case for 90% stocks and 10% cash 50:05 Why quarterly financial reporting matters 55:00 The problem with precise quarterly earnings guidance 59:00 Avoiding emotional market timing and AI productivity tools Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • S1 · E482
    September 10 · 1 hr 5 min

    Everyone Hates Bonds. Why Two Bond Managers Say You're Hating the Wrong Ones

    John Kerschner and Michael Contopoulos of Janus Henderson join Matt Zeigler to explain why persistent inflation and higher interest rates call for a different approach to bond investing. They explore short-duration bonds, AAA CLOs, mortgage-backed securities and how investors can rethink the fixed income allocation in a 60/40 portfolio. The conversation covers why traditional bond benchmarks may deliver too much interest rate risk for their yield, how ETFs expand access to securitized credit, and why the AI buildout could add to inflation rather than solve it. High-Conviction Views: The time for short-duration bonds https://www.janushenderson.com/en-us/advisor/article/high-conviction-views-the-time-for-short-duration-bonds/ Janus Henderson Investors https://www.janushenderson.com/en-us/advisor/ Topics covered: Why deglobalization, fiscal spending and labor constraints could keep inflation and interest rates elevated How the Bloomberg US Aggregate Bond Index concentrates interest rate risk and leaves out large parts of the bond market How AAA CLOs work, why their coupons float, and why they are different from cash Why tight corporate credit spreads may offer insufficient compensation for the risks investors take The three jobs of fixed income: safety, income and insurance How duration determines whether rising rates can wipe out a bond portfolio's income Why bond ETF discounts can reflect price discovery when underlying bonds are not trading How Treasury borrowing and AI hyperscaler debt issuance affect bond supply and relative value Why AI capital spending, electricity demand, labor shortages and wealth effects can create inflation How to rebuild the bond allocation around securitized credit, agency mortgages and the risks in your equity portfolio Timestamps: 00:00 Rethinking bonds after years of disappointing returns 04:28 Why the forces behind the bond bull market have changed 10:09 The hidden interest rate risk in the Aggregate Bond Index 14:53 AAA CLO ETFs: Floating income, structure and drawdown risk 20:44 Treasury fiscal risk and tight corporate credit spreads 26:16 Moving beyond set-and-forget bond funds 30:45 How duration can overwhelm your bond yield 36:27 Bond ETF liquidity and price discovery during stress 41:11 Treasury borrowing, AI debt and securitized bond supply 46:00 How hyperscaler borrowing can create credit market dislocations 50:29 Four reasons AI could increase inflation 55:56 Rebuilding the 40% bond allocation in a 60/40 portfolio 01:02:00 Municipal bonds, recession protection and balancing equity risk Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • S1 · E481
    September 8 · 56 min

    All-In on the S&P 500 Worked for 18 Years | Jared Dillian on Why It's Still Wrong

    Jared Dillian joins Matt Zeigler to discuss The Awesome Portfolio, his approach to asset allocation built around 20% each in stocks, bonds, gold, cash, and real estate. They explore how diversification, annual rebalancing, and managing volatility can help investors reduce financial stress and build a portfolio they can stick with through bear markets. Jared explains his "life hedge" concept, challenges conventional wisdom about stock market drawdowns, and shares how losing half his net worth during the financial crisis shaped his investing philosophy. Buy The Awesome Portfolio Book https://amzn.to/3Tf3of7 Topics covered: Why Jared questions putting your entire life savings in the S&P 500 How the Awesome Portfolio differs from Harry Browne's Permanent Portfolio Including home equity when measuring your overall asset allocation Why volatility and frequent portfolio checking can lead to costly decisions The life hedge: protecting against your job and investments declining together Why Jared disagrees with Charlie Munger about tolerating large drawdowns Index concentration, changing correlations, and the limits of diversification The portfolio's historical backtests, including its losses in 2008 and 2022 Annual rebalancing, cash reserves, inflation protection, and cryptocurrency Managing FOMO and taking practical steps toward a less stressful retirement portfolio Timestamps: 00:00 Jared Dillian's case against an all-stock portfolio 06:33 The five equal allocations in the Awesome Portfolio 11:07 Why "never sell" can become a behavioral trap 15:26 The life hedge: when your paycheck and portfolio fall together 20:38 Risk-adjusted returns and S&P 500 concentration 24:49 Why rising interest rates hurt diversification in 2022 28:51 Backtested losses in 2008 and 2022 34:26 Combining home equity, retirement accounts, and savings 38:58 Cryptocurrency, portfolio distractions, and FOMO 44:31 The Death of Equities and lessons from past crashes 48:44 How diversification could have changed Jared's financial crisis 53:41 First steps toward reducing portfolio risk before retirement Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • September 6 · 55 min

    Nvidia Is Betting on Its Customers. Gen Z Is Betting on Sports. Will It All End the Same Way?

    Cameron Dawson and Dave Nadig join Matt Zeigler on Click Beta to explore how sports betting, leveraged ETFs and speculative behavior are blurring the line between gambling and investing. They also examine AI circular financing, hyperscaler cash flow and corporate disclosure, asking what investors might be missing beneath headline earnings. The conversation closes with baseball, music fandom and the challenge of learning from imperfect role models. Subscribe to Click Beta on Spotify⁠⁠ ⁠⁠Subscribe to Click Beta on Apple Podcasts Topics covered: Why sports betting is becoming a financial planning issue for Gen Z and wealthy families How overconfidence and confusion between skill and luck encourage speculative behavior Why rapid market recoveries may reinforce risk-taking instead of teaching caution How recurring gambling losses can quietly undermine savings and wealth accumulation The risks of placing gambling products alongside investments in brokerage apps Leveraged ETF innovation, hourly resets and competing approaches to investor protection AI circular financing, payment terms, leases and opaque special purpose vehicles How one-time investment gains can distort headline earnings and future growth comparisons Why less frequent corporate reporting could favor investors with greater resources Baseball, emo music, Nirvana merchandise and what makes a meaningful role model Timestamps: 00:00 Sports betting, ETFs and the gambling economy 05:24 Financial planning after crypto and gambling wins 10:57 Why slow gambling losses can be harder to recognize 16:55 Betting inside brokerage apps and regulatory backlash 21:03 Gambling budgets and the next wave of leveraged ETFs 25:04 AI financial shenanigans and hyperscaler cash flow 29:25 Who benefits from less corporate disclosure? 34:24 Discovering new passions in adulthood: Westerns and baseball 38:30 Hot Topic, Nirvana sweatpants and cultural gatekeeping 43:17 Can band merchandise introduce a new generation to music? 47:26 Keith Morris and the search for meaningful role models 51:34 Learning from imperfect people without idolizing them Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

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    September 3 · 1 hr

    Bearish Into November. Room to Run After: Why Dan Niles Is Watching Hyperscaler Credit Default Swaps

    Dan Niles joins Excess Returns to explain why he believes AI is a genuine industrial revolution and a bubble at the same time, with significant opportunity still ahead but growing risks in semiconductors, software, AI CapEx and credit markets. We discuss NVIDIA, OpenAI, Anthropic, China’s semiconductor push, data center politics, AI debt issuance, Fed policy and the downside protection framework Dan uses to navigate technology cycles. Dan Niles on X https://x.com/DanielTNiles Niles Investment Management https://www.nilesinvestmentmanagement.com Topics covered: Why AI can be both a transformational technology and an investment bubble The AI metrics Dan watches: token pricing, token growth, cloud revenue and operating margins What the Situational Awareness unwind showed about leverage, forced selling and semiconductor volatility Why hyperscaler AI revenue can accelerate even as free cash flow deteriorates How data center opposition, electricity constraints and politics could slow the AI buildout Where value may accrue across the AI stack and why Anthropic and Google could pressure OpenAI Why China’s memory chip expansion could bring semiconductor cyclicality back faster than investors expect How AI is reshaping software, including security, systems of record, gaming and usage-based pricing Why the shift from free cash flow to debt financing matters for AI CapEx, Treasury yields and credit markets Dan’s long-short investment process, Fed outlook, market risk framework and emphasis on downside protection Timestamps: 00:00 Intro 04:00 The signals Dan watches to know when the AI bubble is peaking 09:12 AI ROI, hyperscaler profits and the problem with negative free cash flow 14:19 Why data center politics could become a major risk to AI growth 21:28 Why semiconductors are still cyclical and China could change the supply picture 25:47 Why smart companies still get bubbles wrong and agentic AI could extend the cycle 30:43 Is software the next major casualty of AI disruption? 35:04 Why video games may be one of software’s safer AI categories 39:23 Can markets absorb the surge in AI debt and equity issuance? 45:28 Dan Niles’ long-short investment process and approach to downside protection 50:45 Why Dan thinks the Fed could raise rates in September 56:38 Why buy-and-hold can fail and downside protection matters Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • September 3 · 51 min

    The Fed Credibility Narrative Has Turned | Ben Hunt on AI, the Consumer and Financial Repression

    Ben Hunt joins Matt Zeigler to explain why damaged Fed and Treasury credibility could matter just as four major risks converge across private credit, AI financing, oil and the consumer. They discuss financial repression, rising long-term rates, shadow banking and insurance risk, the AI CapEx growth engine, and why Hunt believes gold may benefit if policymakers keep trying to suppress the price of money. Subscribe on Spotify⁠ ⁠Subscribe on Apple Topics covered Why credibility is a teacup and why policy reputation is difficult to repair once it breaks How the Fed's July rate decision changed the market narrative around inflation credibility The Four Horsemen: insurance and shadow banking losses, capital crowding out, the Iran war and oil inflation, and a stretched consumer Why insurer-funded private credit could become a systemic risk if fraud and losses reach major institutions How government borrowing and AI data center financing could push long-term interest rates higher Why fading fiscal stimulus, depleted savings and higher energy costs leave the consumer vulnerable What financial repression means and how the Fed and Treasury could try to cap rates and prevent major losses Why AI investment may be the key source of US economic growth if consumer activity stalls How Perscient tracks narrative regimes, virality and shifts in common knowledge across markets Why gold can act as an inverse measure of trust in central banks and how Ben is positioning around the risks Timestamps 00:00 Intro: Credibility is a Teacup 04:00 How the July Fed decision damaged inflation credibility 08:21 The Four Horsemen that could threaten the financial system 14:00 Oil inflation, the Iran war and a stretched consumer 18:39 What financial repression means 23:20 How the Fed and Treasury could try to prevent a systemic crisis 28:21 Why AI CapEx may be the only major source of GDP growth 35:00 When lost Fed credibility became a confirmed market narrative 39:34 Narrative stock versus flow and how bursts can move prices 44:00 The return of bearish AI CapEx narratives 48:09 Why private credit may be easier to can-kick than the 2008 crisis Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • August 31 · 1 hr 2 min

    Sticky Inflation. Cheap Volatility. A Less Predictable Fed. Why Aren’t Markets More Worried?

    This month on Last Call, Kevin Muir, Aahan Menon, Ben Hunt and Brent Kochuba break down the market through four lenses: macro, inflation data, narrative and options positioning. They examine whether midterm election volatility is underpriced, why inflation may be more demand-driven and persistent than headline data suggests, how the Fed's credibility has shifted under Kevin Warsh, and why options markets still look remarkably complacent. Follow Last Call on Spotify⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠Follow Last Call on Apple Podcasts⁠ Topics covered Why ending Fed forward guidance could create more uncertainty around interest rate decisions Kevin Muir's case that midterm election volatility is unusually cheap Why seasonal volatility, low implied correlation and election risk may favor owning protection Aahan Menon on inflation breadth and why 70 to 80 percent of PCE components are above the Fed's 2 percent target Why demand-driven inflation may be stickier than supply-driven inflation How oil shocks can feed into core inflation and increase pressure on the Fed to hike Ben Hunt on the sudden collapse in the Fed credibility narrative and why gold has responded The four risks facing the Fed and Treasury: oil, fading fiscal stimulus, insurance and private credit stress, and the long end of the Treasury curve Brent Kochuba on why implied volatility and put positioning show a market with very little fear Nvidia options positioning, potential resistance near 250 to 275, and what dealer gamma says about the stock Stanley Druckenmiller's AI-written Wall Street Journal op-ed and what AI-assisted writing means for investment thinking Timestamps 00:00 Midterms, inflation, Fed credibility and options complacency 07:45 Kevin Muir on why midterm volatility may be underpriced 11:55 Why this midterm could be more volatile than the options market expects 16:36 Cheap volatility and how election risk could get repriced 20:39 Inflation breadth and why the headline numbers miss the bigger problem 25:43 Why cooling inflation data may hide persistent demand-driven pressure 33:31 Ben Hunt on why the Fed credibility narrative suddenly reversed 40:01 Four risks the Fed and Treasury cannot afford to ignore 44:43 What the options market says after Jackson Hole 49:10 Why Fed events can become an expensive options tax 53:14 Why falling volatility could help stocks push toward new highs 57:34 Druckenmiller, AI-written investment commentary and authenticity 01:01:53 Why writing is part of thinking in an AI world Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

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    August 29 · 1 hr 4 min

    The Profits Come Now. The Costs Come Later. Kevin Muir on Whether AI Earnings Are the Bubble

    Kevin Muir of The MacroTourist joins Matt Zeigler to break down the bond market, Scott Bessent's Treasury buybacks, the Treasury General Account, AI-driven earnings growth, leveraged ETF risk, gold and the U.S.-Canada trade fight. Kevin explains why rising long-term yields may be less surprising than investors think, how the AI capex boom can inflate earnings before costs show up, and why leveraged ETFs and policy uncertainty could make markets more fragile. Kevin Muir on X https://x.com/kevinmuir The MacroTourist https://themacrotourist.com Topics covered Why stronger nominal GDP, large fiscal deficits and record corporate issuance are pressuring long-term Treasury yields How Scott Bessent's Treasury liquidity buybacks work and why investors are comparing them with QE and Operation Twist How replacing long-dated Treasuries with T-bills could ultimately force reserve management purchases by the Federal Reserve Why the Treasury General Account matters for liquidity and why attempts to manage the yield curve can distort market signals Jim Chanos's "earnings bubble" argument and how massive AI data-center capex can boost current earnings while costs are amortized Why stock prices can fall before forward earnings estimates roll over, and why retail investors may have an advantage over institutions How daily-reset leveraged ETFs create reflexive buying and selling and could amplify a semiconductor or single-stock selloff Why Kevin is bullish on gold again, the role of People's Bank of China demand, and how he combines fundamentals with technical signals Why platinum below production cost caught his attention and what rolling mini-bubbles in gold, silver and AI say about investor psychology What 2025 U.S.-Canada trade data says about autos, oil and gas, manufacturing, tariffs and the economic cost of policy uncertainty Timestamps 00:00 Intro 06:31 Scott Bessent's Treasury buybacks and the bond market 10:39 How T-bill issuance could lead to debt monetization 18:25 The AI capex boom and the "earnings bubble" 22:27 The giant bet embedded in accelerating AI earnings 27:37 Why leveraged ETFs are changing market structure 32:00 How forced ETF unwinds can amplify a selloff 36:41 Why Kevin is bullish on gold again 41:57 Platinum, production costs and the precious metals trade 46:08 Sentiment extremes and why popular trades get dangerous 51:00 Globalization, manufacturing and America's distribution problem 55:00 Why oil and gas dominate the U.S.-Canada trade deficit 59:00 How tariff uncertainty can deter U.S. manufacturing investment 01:03:10 The trade math Kevin wants investors to see Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

  • August 28 · 57 min

    Private Equity Chased Software. Big Tech Is Chasing AI. Dan Rasmussen on If They Are Making the Same Mistake Twice

    Dan Rasmussen, founder and managing partner of Verdad Advisers and author of The Humble Investor, joins Kai Wu to examine the unraveling of private equity, the rise of private credit, and how AI is reshaping software, labor, and the economics of technology investing. They also explore the massive AI CapEx boom, why value investing has struggled in the intangible-heavy U.S. market, the unusual opportunity in Japanese small caps, and how investors can quantify intangible value in biotech. Subscribe on Spotify⁠⁠⁠ ⁠⁠⁠Subscribe on Apple Topics covered: Why private equity became a consensus trade and why exits are now clogged How leverage and high debt costs threaten private equity returns What publicly traded private equity funds reveal about true volatility and NAV discounts How private equity shifted from old-economy buyouts into software and healthcare technology Why AI may have erased code as a software moat while strengthening other intangible advantages How ARR lending helped private credit finance software buyouts and created an obsolescence mismatch What AI is doing to hiring, junior roles, productivity and the composition of work Why the AI CapEx boom may be a crowded, path-dependent overinvestment cycle Why traditional value metrics work better in Japan than in the intangible-heavy U.S. How Tokyo Stock Exchange reforms, buybacks and dividends can unlock value in Japanese small caps How R&D spend, specialist ownership and short interest can help quantify biotech value Timestamps: 00:00 Intro 04:03 Why private equity's debt burden changes the equity math 09:24 How private equity became a software momentum trade 13:29 Why code may no longer be a durable software moat 17:48 How private credit enabled software buyouts through ARR lending 23:56 AI productivity, jobs and why displacement is slower than expected 30:23 Why the AI CapEx boom may be the market's most crowded risk 34:29 Rational overinvestment, leverage and the timing risk in AI 38:46 Why consumers may capture more of AI's value than investors 44:07 Japan's below-book-value reform and the return of old-school value 51:03 Quantifying biotech value with R&D, specialist ownership and short interest 55:08 Dan's non-consensus views on private markets and Japan Learn more about the Excess Returns podcast network: https://excessreturns.co No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

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