Excess Returns

Excess Returns
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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.

  1. FA 1 DIA

    The Risk at the End of the Whip | GMO’s Tom Hancock on Finding Conviction Amid the AI Hype

    This episode of Excess Returns features GMO’s Tom Hancock on how to think about AI as an investment opportunity and what truly defines “quality” in today’s market. The conversation breaks down the AI value chain, challenges common assumptions about where value will accrue, and ties it all back to building durable portfolios in a rapidly changing technological landscape. Tom walks through his “Hype vs High Conviction” framework, explaining why identifying the right layer of the AI ecosystem may matter more than simply betting on the theme itself, and why balance sheets, durability, and capital allocation remain critical even in the most exciting growth environments. Hype vs High Conviction https://www.gmo.com/americas/research-library/hype-vs-high-conviction_insights/ Topics Covered: Why AI may be the most important investment decision today The four-layer AI stack: applications, LLMs, hyperscalers, and infrastructure Why investors confuse secular trends with investable opportunities Following the money through the AI value chain The hidden risks of investing lower in the stack Why today’s tech leaders differ from the dot-com era Growth vs maintenance capex and what it means for AI economics Why software may be more resilient than markets think How GMO defines “quality” and why it matters in volatile markets Portfolio construction: where GMO is investing (and avoiding) in AI Timestamps:00:00 Intro and framing the AI investment debate00:00:55 Tom Hancock background and focus on quality investing00:02:00 What investors are getting wrong about AI00:03:23 Breaking down the four layers of the AI ecosystem00:06:45 Applications vs infrastructure: where value may accrue00:08:45 Why predicting AI winners is still difficult00:11:00 Following the cash flows through the AI stack00:13:00 Why AI funding is more stable than past tech bubbles00:16:00 Big Tech strategy differences and capital allocation decisions00:17:34 Are today’s tech companies higher quality than in 1999?00:19:00 Growth vs maintenance capex and implications for Nvidia and others00:22:00 Depreciation, chip lifecycles, and hidden risks in capex assumptions00:24:00 Capital intensity vs quality: when heavy investment is a feature00:27:00 Why incumbents may benefit most from AI00:28:30 Risks in the LLM layer and potential commoditization00:30:10 Software disruption fears: overdone or justified?00:34:06 Defining “quality” in investing00:36:00 Balance sheets vs return on capital00:38:32 Why GMO sold Oracle and the risks of leverage00:40:18 What happens if AI spending slows down00:41:35 Where the biggest risks are in the AI stack00:44:26 Where GMO is positioned vs the S&P 50000:48:00 How new ideas enter a quality portfolio00:51:00 Sell discipline and portfolio turnover00:53:00 International vs US quality investing

    58 min

  2. FA 2 DIES

    The Walmart Indicator Just Hit 2008 Levels | Jim Paulsen on the Big Difference This Time

    This episode of Excess Returns features Jim Paulsen breaking down the current macro environment through a series of powerful indicators, including oil, interest rates, consumer behavior, and market sentiment. The discussion explores whether today’s environment signals a slowing economy—or the early stages of a new bull market hidden beneath the surface. Subscribe to the Jim Paulsen Show on Spotify⁠ ⁠Subscribe to the Jim Paulsen Show on Apple Podcasts Jim walks through a wide range of charts and frameworks, from the Walmart vs. luxury retail signal to private credit stress, productivity trends, and policy uncertainty, offering a data-driven perspective on where markets and the economy may be headed next. Paulsen Perspectives Substackhttps://paulsenperspectives.substack.com Topics Covered Why the recent oil spike hasn’t impacted inflation and interest rates as expected Slowing economic growth vs. recession risk and what the Fed might do next The Walmart vs luxury retail indicator and what it signals about the economy Private credit risks and how they differ from traditional credit crises Why many indicators point to a new bull market rather than a bear The role of sentiment, volatility, and uncertainty in driving market returns Market rotation from mega-cap “new era” stocks to broader market leadership Corporate profits divergence and the opportunity in the rest of the economy Liquidity, cash levels, and positioning as potential fuel for markets Productivity trends and whether AI-driven gains are real or overstated Timestamps00:00 Intro and current macro backdrop01:05 Oil spike and limited impact on yields and inflation04:45 Growth outlook and why recession may still be avoided07:10 Fed policy and the stagflation question10:15 Walmart vs luxury retail indicator explained13:40 Private credit stress vs traditional credit cycles17:00 Why this isn’t 2008 and how balance sheets differ19:50 Private credit risks and market spillover effects22:15 Bear market fears vs signs of a new bull23:45 Consumer confidence and its impact on returns25:05 Oil spikes historically as buy signals26:15 VIX, volatility, and market bottoms27:05 Yield curve steepening and market implications28:05 Sentiment indicators and what they really reflect30:00 Market rotation and broadening beyond mega caps32:45 Passing the baton from tech to broader markets35:15 Corporate profits divergence and future potential37:00 Policy uncertainty and why it can be bullish42:05 Liquidity, cash levels, and risk allocation43:20 Options positioning and put-call signals44:05 Gold vs commodities and risk appetite45:10 Consumer credit contraction and market signals46:20 Polymarket recession probabilities as sentiment47:30 Economic sentiment collapse and contrarian signals48:10 Interest rate expectations and positioning49:05 Unemployment trends and historical market bottoms50:25 Productivity trends and AI impact on the economy

    1 h

  3. FA 4 DIES

    The Inevitability No One Sees | $11 Billion Tech Manager on What Investors Miss About AI

    This episode of Excess Returns features Tony Wang of T. Rowe Price discussing how investors can identify “inevitabilities” in technology and position portfolios to benefit from long-term innovation trends. The conversation explores AI, semiconductors, and the evolving investment landscape, while also breaking down Tony’s portfolio construction process and how he navigates cycles, valuation, and disruption risk. Tony explains why AI is fundamentally changing the cost of intelligence, how agentic systems could reshape software and labor markets, and why the current AI buildout may differ from past tech cycles. The discussion also dives into where we are in the AI cycle, how to think about the Mag 7, and what investors may be missing across the tech stack. T. Rowe Price Science and Technology Fund https://www.troweprice.com/financial-intermediary/us/en/investments/mutual-funds/us-products/science-and-technology-fund.htmlTopics Covered What it means to invest in “inevitabilities” and separating signal from noise in markets Why AI and compute demand represent a structural shift similar to past tech waves The rise of agentic AI and how it could transform software and productivity Whether AI is underappreciated or already priced into markets The “multiple moons” idea and why AI may not be a winner-take-all market How AI could reshape the labor market, productivity, and economic growth The AI CapEx debate and why this cycle may differ from the dot-com buildout Where we are in the AI cycle: training vs inferencing and deployment phase The impact of AI on software companies and the innovator’s dilemma How semiconductors, memory, and infrastructure remain key bottlenecks The changing nature of the Mag 7 and capital intensity in AI Tony’s portfolio construction framework across compounders, emerging tech, and value How he generates ideas using S-curve adoption and economic bottlenecks Position sizing, risk management, and balancing growth with drawdown control Sell discipline: valuation, fundamentals, and market signals Timestamps 00:00 Introduction and Tony Wang overview 01:05 Investing in inevitabilities and long-term thinking 03:00 Differentiating inevitability from hype and consensus 04:45 AI inevitability and the rise of agentic systems 07:00 Cost of intelligence and productivity implications 08:00 Real-world examples of AI adoption (customer service, agents) 09:00 Is AI underappreciated by markets? 11:15 AI as a “space race with multiple moons” 13:30 AI as the dominant driver of markets today 15:00 AI’s impact on jobs, productivity, and the economy 18:30 Creativity, judgment, and the future of work 20:45 Physical AI and robotics opportunity set 22:30 AI CapEx debate vs the dot-com era 25:30 Semiconductors vs software in the AI stack 28:15 AI disruption risk for software companies 31:00 Cyclicality in semiconductors and how AI changes it 33:30 The evolving role of the Mag 7 in AI 36:30 Competition, startups, and AI democratization 38:00 Where we are in the AI cycle today 40:00 Idea generation and S-curve adoption framework 42:30 Case study: memory and AI bottlenecks 44:45 Example position: optical networking and infrastructure 46:40 Portfolio construction and position sizing 49:00 Sell discipline and managing valuation risk

    1 h 3 min

  4. 3 D’ABR.

    The Signal Before the Spike | Katie Stockton on What the Charts Tell Us About What Comes Next

    This episode explores the growing signs of a shift beneath the surface of the market, as technical indicators point to weakening momentum in equities and a potential change in leadership. Katie Stockton joins the show to break down what recent signals in the S&P 500, oil, gold, and sector rotation are telling us about where markets may be headed next. We cover the implications of a new monthly MACD sell signal, the importance of market breadth and leadership, and how investors can interpret shifting trends across asset classes using a disciplined technical framework. More on Katie's Strategies https://www.fairleadstrategies.com/ Topics Covered: Why a new monthly MACD sell signal may signal a longer, choppier market phase The difference between fast corrections and slow grind bear phases Key S&P 500 support levels and what a breakdown could mean for downside risk How technical indicators help filter noise in headline-driven markets The breakout in crude oil and what it signals about a potential new cycle Whether sharp price moves are sustainable or likely to reverse Understanding overbought and oversold conditions across different timeframes Why mega-cap weakness is critical to overall market direction The shift from growth to value and what it means for investors Sector rotation trends and where leadership is emerging in 2025 What gold’s recent run and emerging weakness signal for safe haven assets How a systematic, technical approach can help manage drawdowns and re-entry timing Timestamps: 00:00 Intro 04:18 S&P 500 momentum deterioration and MACD sell signal 08:09 Key support levels and downside scenarios for equities 12:53 Crude oil breakout and implications for a new cycle 16:01 What overbought and oversold really mean in practice 20:04 Mega-cap weakness and shifting market leadership 24:41 Concentration risk in investor portfolios 27:52 Value vs growth rotation and cycle dynamics 32:13 Market breadth and confirmation signals 36:19 Moving averages, death cross, and trend interpretation 39:56 Inside the TAC ETF and sector rotation strategy 44:04 Gold trends and why consolidation may be next 47:00 Key signals to watch going forward

    49 min

  5. 2 D’ABR.

    Michael Mauboussin | AI, Base Rates, and Investing in the New Economy

    In this inaugural episode of our new show, The Intangible Economy with Kai Wu, we explore how AI, intangible assets, and unprecedented capital investment are reshaping the future of markets. Michael Mauboussin joins Kai to break down why today’s AI expectations may be historically unmatched—and what that means for investors trying to assess risk, returns, and who ultimately captures value. Subscribe on Spotify Subscribe on Apple The conversation moves from base rates and AI growth expectations to competitive dynamics, capital cycles, and the fundamental shift toward intangible-driven business models that are changing how we think about valuation, moats, and market structure. Papers and Resources Discussed: Bayes and Base Rates: How History Can Guide Our Assessment of the Futurehttps://www.morganstanley.com/im/en-us/institutional-investor/insights/consilient-observer/bayes-and-base-rates.html The Impact of Intangibles on Base Rateshttps://www.morganstanley.com/im/publication/insights/articles/article_theimpactofintangiblesonbaserates.pdf Measuring the Moat: Assessing the Magnitude and Sustainability of Value Creationhttps://www.morganstanley.com/im/publication/insights/articles/article_measuringthemoat.pdf One Job: Expectations and the Role of Intangible Investmentshttps://www.morganstanley.com/im/publication/insights/articles/article_onejob.pdf Capitalism Without Capital: The Rise of the Intangible Economyhttps://books.google.com/books/about/Capitalism_without_Capital.html?id=J3SYDwAAQBAJ A Better Estimate of Internally Generated Intangible Capitalhttps://pubsonline.informs.org/doi/10.1287/mnsc.2022.01703 Underestimating the Red Queen: Measuring Growth and Maintenance Investmentshttps://www.morganstanley.com/im/publication/insights/articles/article_underestimatingtheredqueen.pdf Explaining the Recent Failure of Value Investinghttps://papers.ssrn.com/sol3/papers.cfm?abstract_id=3442539 Guest Links: Michael Mauboussin Twitter Topics Covered: Why OpenAI’s projected growth would be unprecedented in market history How base rates provide a reality check on AI expectations The role of diffusion models and adoption curves in forecasting technology Why massive capital investment in AI may follow past boom-bust cycles Lessons from large-scale infrastructure projects and why timelines break How intangible assets change the distribution of business outcomes The rise of “fat tails” and why more companies now massively win or fail Who captures value in AI across the stack from chips to applications Why competition may drive AI profits toward consumers, not producers How accounting distorts intangible investment and misleads investors Timestamps: 00:00 Intro and OpenAI growth expectations vs historical base rates04:32 Why no company has ever achieved 100%+ sustained growth at scale08:47 Lessons from megaprojects and AI infrastructure buildouts13:18 Intangible assets and why outcomes now have fatter tails18:36 Why big tech is growing faster than historical precedents23:52 Where value accrues in AI and why consumers may benefit most28:21 Barriers to entry in AI including capital, talent, and scale32:47 The risk of overinvestment and historical parallels to past bubbles37:26 Game theory and competitive signaling in AI capital spending41:58 Why investment returns—not “asset light” narratives—drive value46:12 How accounting fails to capture intangible investment properly50:44 Breaking down SG&A into maintenance vs investment spending55:03 Why understanding reinvestment and ROI is the core investing skill59:18 Final thoughts on uncertainty, expectations, and base rates in AI

    1 h 2 min

  6. 31 DE MARÇ

    The Stagflation Regime | Aahan Menon on What Works When Stocks and Bonds Don’t

    This episode of Excess Returns features Aahan Menon of Prometheus Research breaking down the growing risk of an inflation shock driven by energy markets and what it means for investors. The discussion explores how a potential shift toward stagflation could challenge traditional stock and bond portfolios and why commodities, trend following, and systematic frameworks may be better suited for the current environment. Prometheus Research https://www.prometheus-research.com Aahan Menon Twitter https://x.com/@AahanPrometheus Why the current inflation shock may be one of the most significant in recent history How oil prices and geopolitical conflict are reshaping macro expectations The growing risk of a stagflationary environment and what it means for portfolios Why traditional 60/40 portfolios may struggle in sustained inflation regimes How expected returns differ across equities, bonds, commodities, and FX Why commodities and energy markets offer the most attractive opportunities today The role of backwardation and supply shocks in driving commodity returns Why consensus earnings expectations may be too optimistic relative to macro reality How inflation flows through the economy from energy to consumer demand The Fed’s dilemma between inflation control and economic slowdown A simple rule for when to own treasuries based on inflation trends Why correlations across asset classes are breaking down in crisis environments How systematic investors manage risk when markets are driven by news and geopolitics The case for trend following as a core portfolio strategy How Aahan’s free trend system works across stocks, bonds, gold, and Bitcoin The behavioral advantages of systematic investing during volatile markets Risks of trend following including whipsaws and false signals How portfolio construction is evolving to include crisis protection and energy overlays 00:00 Inflation shock and why equities and bonds may struggle 01:03 Setting up the macro backdrop before the oil shock 03:12 Labor market slowdown vs strong GDP divergence 04:45 Consumer spending driven by de-saving 05:35 Oil-driven inflation shock as a recession catalyst 07:32 Preparing for stagflation vs disinflationary growth 09:18 Why commodities outperform in inflation regimes 10:45 Expected returns framework across asset classes 12:05 Why commodities and FX offer the best opportunities 14:05 How commodity carry and backwardation work 16:42 Trend following and commodities as pro-cyclical exposures 17:43 Ranking expected returns: energy, FX, bonds, equities 18:51 Challenges of systematic investing in news-driven markets 20:15 Extreme correlations and oil dominating asset pricing 23:47 Earnings expectations vs macro reality gap 28:30 Why the Fed faces an impossible policy tradeoff 30:00 Real-time CPI estimates and inflation pressure 32:00 A rule for when to own treasuries based on CPI 37:30 Stock-bond correlation regime shifts 39:34 How the trend following system works 45:10 Benefits and limitations of trend strategies

    58 min

  7. 30 DE MARÇ

    6x Earnings. 10x Potential. | Harris Kupperman on the Inflections Wall Street Misses

    This episode explores Harris “Kuppy” Kupperman’s framework for “inflection investing” and how he identifies asymmetric opportunities across global markets. The conversation dives into why he believes U.S. equities are structurally challenged, where he sees better opportunities globally, and how macro, politics, and capital flows drive major investing inflections. Inflection investing and identifying asymmetric opportunities How macro and politics create winners and losers in markets The Argentina case study and why the stock exchange may outperform the country How to structure trades with limited downside and multi-bagger upside Time horizon advantages versus short-term Wall Street thinking Portfolio construction, capital allocation, and when to sell positions Managing risk, leverage, and liquidity during crises and wars Building a “shopping list” during market dislocations Country ETFs vs individual securities in global investing Why Kuppy prefers international markets over the U.S. The structural imbalances in the U.S. economy and stock market Why AI may lead to profitless growth and economic disruption The impact of AI on jobs, margins, and economic demand How inflation distorts economic data and investor perception Finding opportunities in “left for dead” markets like Brazil The role of elections and policy shifts in market inflections How to think probabilistically about investments Avoiding unforced errors and emotional decision-making The importance of long-term thinking in volatile markets Psychology and discipline in global macro investing Harris Kupperman Twitter https://twitter.com/HedgeyeKuppy Praetorian Capital Website https://praetorian-capital.com Timestamps 00:00 Why the U.S. stock market is structurally overvalued 01:14 What “inflection investing” means 02:54 Top-down vs bottom-up investing framework 04:31 Using politics to identify winning trades 05:00 Argentina trade setup and execution 06:20 Why the Argentine stock exchange is the best play 08:00 Earnings inflection and multiple expansion potential 10:37 Time horizon and holding period strategy 13:00 When to exit positions and recycle capital 18:41 How and when to raise cash 19:41 De-grossing the portfolio during crises 23:14 Real-time decision making during war scenarios 27:00 Building a shopping list during dislocations 29:32 ETF vs individual stock decision process 33:22 Why the U.S. is less attractive than global markets 38:17 The problem with AI-driven “growth” 43:31 Monitoring vs acting across global opportunities 48:14 The psychology of long-term investing and edge

    1 h 3 min

  8. 28 DE MARÇ

    The Moment Common Knowledge Changed | Last Call - With Andy Constan, Ben Hunt, Brent Kochuba and Eric Pachman

    This episode of our new market wrap show Last Call breaks down the biggest market drivers right now through three distinct lenses: macro, narrative, and flows. With an oil shock driven by geopolitical conflict, rising volatility, and conflicting economic signals, the discussion focuses on what actually matters beneath the surface and how investors should think about positioning in an environment where nothing is clearly priced in. Follow Last Call on Spotify⁠⁠⁠ ⁠⁠⁠Follow Last Call on Apple Podcasts⁠ Jack and Matt bring together Andy Constan, Ben Hunt, Brent Kochuba, and Eric Pachman to analyze the ripple effects of higher oil prices, the “common knowledge” shift in markets, the role of options flows in driving short-term moves, and why traditional economic indicators like unemployment may be telling a misleading story. Andy Constan Twitterhttps://x.com/dampedspring Ben Hunt Twitterhttps://x.com/EpsilonTheory Brent Kochuba Twitterhttps://x.com/spotgamma Eric Pachman Twitterhttps://x.com/epachman Topics covered: How oil supply shocks impact GDP, inflation, and consumer spending Why higher oil prices act as a tax on the economy and shift growth dynamics The difference between supply shocks and demand shocks in energy markets Why central banks may be unable to respond to an oil-driven slowdown The “common knowledge” framework and how narratives reshape markets Why the Strait of Hormuz has become the key global economic bottleneck Oil exporters vs importers and how that divide is driving asset performance Why energy equities may outperform in a prolonged geopolitical conflict How volatility is being driven by oil prices and geopolitical risk The relationship between VIX and oil during crisis periods Why $100 oil could trigger a major volatility spike and equity selloff The JP Morgan collar trade and how options positioning can pin markets How dealer hedging flows influence short-term price action Why markets may appear disconnected from negative news The limits of predicting what is “priced in” during uncertain environments Why diversification matters more when macro visibility is low How unemployment data can mislead by excluding people leaving the workforce The difference between unemployment rate and labor force participation Structural decline in rural economies and the migration to urban centers How labor force trends explain the divergence in economic experiences across the US Timestamps:00:00 Oil shock as a GDP tax on consumers00:16 Strait of Hormuz as global economic chokepoint00:29 Why $100 oil could send VIX to 5000:39 Why unemployment rate may be misleading01:07 What Last Call is and how the episode is structured02:28 Macro, narrative, and flows framework for markets03:44 How oil supply shocks impact growth and inflation06:00 Why higher oil prices reduce discretionary spending07:00 Oil’s impact on inflation and central bank policy09:39 Scenario analysis for oil prices and market outcomes12:28 Is the oil shock priced into markets?16:00 Why oil vs assets may be mispriced20:00 Ben Hunt on the “common knowledge” market shift25:00 Why the Strait of Hormuz changes everything29:00 Portfolio implications: long energy vs global equities33:00 Brent Kochuba on oil, VIX, and market volatility linkage36:00 Why $100 oil is the key risk threshold for equities40:00 JP Morgan collar trade and market pinning dynamics44:00 Why options flows can override macro narratives short term52:00 Eric Pachman on unemployment vs labor force reality59:00 Structural decline in labor force across US counties

    1 h 10 min
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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.

Fitxa tècnica

  • Creació
    Excess Returns
  • Anys en actiu
    2019 - 2026
  • Episodis
    489
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    Apte
  • Copyright
    © 905628
  • Lloc web del programa
    Excess Returns

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