Time Stamp References:0:30 - His journey into investing.5:30 - This rally isn't sustainable.8:40 - America is addicted to debt.10:30 - Bear markets take 18 to 24 months.12:15 - 3 Trillion in additional debt.16:00 - The value of a dollar today.20:00 - Why value doesn't die.23:30 - His alternate FANG.29:00 - Gold is wildly undervalued.30:00 - Countries will inflate their currency.36:30 - Avoiding your personal cognitive bias.
Tom welcomes a new guest Mark Yusko who is CEO and Chief Investment Officer of Morgan Creek Capital Management. Mark says we have the highest amount of leverage at all levels today, which is very similar to 1929. The 1929 crash was terrible, with markets falling 47%, then rallied back and then collapsed again. America today has an addiction problem, and that addiction is debt. Debt has to be defaulted on or inflated away, which is the path they choose in the 1930s.
Every bear market has a sharp drop, then a reflective rebound, and then you have a fundamental down cycle. This cycle takes 18 to 24 months. The damage we have done from the shutdown will have long repercussions. We will have depression-like economic activity, which will lead to much lower stock prices.
Social media today exaggerates people's personal biases and creates echo chambers. He discusses his alternate Gold FAAANG, which is composed of undervalued stocks that he believes will do well during the next few years. People today believe that value no longer matters, but Mark argues that it always matters.
Mark Yusko is the Founder, CEO and Chief Investment Officer of Morgan Creek Capital Management. He is also the Managing Partner of Morgan Creek Digital Assets. Morgan Creek Capital Management was founded in 2004 and currently manages close to $2 billion in discretionary and non-discretionary assets. Prior to founding Morgan Creek, Mr. Yusko was CIO and Founder of UNC Management Company (UNCMC), the Endowment investment office for the University of North Carolina at Chapel Hill. Before that, he was Senior Investment Director for the University of Notre Dame Investment Office.