In this week's episode of WSJ’s Take On the Week, co-hosts Gunjan Banerji and Telis Demos dive into how, for the first time, brokerages have taken out more than $1 trillion dollars in margin debt to buy stocks and other securities. Next, they chat about Robinhood’s blowout earnings as another sign of market exuberance, and why investors are eagerly awaiting software and data analytics company Palantir's earnings this week.
Then after the break, Sébastien Page, head of global multi-asset and chief investment officer at T. Rowe Price, joins our hosts to chat about why he thinks AI stocks have strong financial and economic positions, and why he believes stocks will still deliver an equity risk premium. Plus, Page shares what he thinks investors could learn from sports psychology. I hope this is a free link that works to listen or read the transcript. If not, sorry about that!
https://www.wsj.com/podcasts/take-on-the-week/is-the-stock-market-in-a-speculative-bubble-t-rowe-price-cio-weighs-in/3D568963-0B36-43CB-9D86-3F80F342ECBD
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If my view is incorrect, I appear to be in some good company.
Surprisingly, my individual stock portfolio is my YTD winner with 9.21%. Only one stock in the group (ALL) lags S&P. Four stocks have achieved +25% YTD.
While I detest Zuk and will never own META, it and MSFT are more "reasonably overvalued" at 27 and 38.
I cannot easily understand how AI will make them so much money. Do they really have so many low rated coders that they can all be replaced?
If they are selling AI to other companies would you trust META with your sales data customer preferences etc? Many of these pie in the sky projections are just guesses. Look at ORCL, the stock has exploded, but the much touted Cerner acquisition is not why. You would think that a premier software company like ORCL would have been able to make this work, but they apparently are still getting beaten by a private company EPIC.
user on both ends, epic is crap for both healthcare staff and patients.
this tells all needed regarding how bad cerner remains, and why it is naive to think a pure tech acquirer is capable of helping. but rest assured oracle contributed to new pricing models.
Back then Cerner was far easier to deal with as a provider, and Epic was far far too complicated. EHRs were designed as billing and revenue capturing platforms not to enhanced providers or patients experience. Once Bush crammed them down our throats, there was no way to win.
What a gifted / smooth speaker Page is! I think he could sell ice to the proverbial Eskimo. Great analogy about driving home after too many drinks. Similar to one I’ve used before about crossing a deep lake on half-an-inch of ice. In both cases, you’ll probably make it safely 90+% of the time. But it doesn’t necessarily mean you made a “smart” decision. Page ties all this back to risk-taking in your investments.
Sebastian Page: Head of Global Multi-Asset and Chief Investment Officer at T. Rowe Price. Also an accomplished author.
Link to some bio. Would like to learn more about Page - especially his educational background if anyone has it.
Brief excerpt (Linkedin): ”Outside of the office, you’ll find me consuming books, podcasts, studies, and more—anything I can get my hands on that will inform not only my perspective on investing and leadership, but a wide range of interests from philosophy, science, writing, work-life balance, and more. I’m an avid runner and my morning usually consists of a good run while listening to a book or podcast.”
Is the stock market in a speculative bubble? I don’t know. Certainly possible. In keeping with Page’s drinking / driving analogy, it’s ”sobering” for many of us to reflect on some of the tough times we’ve lived through like the dot-com mania & crash, ‘87’s one day “flash-crash”, the ‘07-‘09 downdraft - and even 2022. Things happen.
I rarely buy at the open, but will often sell then ... if I haven't done so in the premarket.
Depending what I'm doing, sometimes I get better prices buying/selling during the 7-9AM or 5-8PM windows which not many retail folks tend to use. (It does feel odd to hear the 'ding' of an occasional transaction come from the other room at say, 708AM or 724PM lol)
I follow Fleckenstein - have for years. He’s of the “bubble” school of thought, but thinks the insanity could go on for years before a break. Market’s too dangerous in his view to short. Still likes the miners even at these levels as they lagged the metal on the way up. In general, I want nothing to do with either. A couple of my funds, however, hold 5-10% of the glittery stuff.
@hank - my equity CEF's have pretty much been a mixed bag of going nowhere in comparison to everyday ETF's. CPZ has been a standout so far and I hold nothing else like it. AIO became too stretched and in view of the fact that its major holdings were duplicated in my tech-related ETF's I sold it about 2 weeks ago but will consider repurchasing should it swoon. On the other hand THQ (healthcare) is still trolling the bottom of the barrel looking for footing. Sold it a week ago and I'm already up over a buck/share. Should have sold as soon as numnuts RFK Jr. was appointed secretary of health. What a disgrace to the legacy of his father/family. Whatever happened to 4 main ethical principles/tenets of healthcare, especially malfeasance?