This week, Matt breaks down The Economist’s “Seven Deadly Sins of Corporate Exuberance,” covering crypto-leveraged balance sheets, meme-driven valuations, circular AI investment loops, debt-gluttonous M&A, patriotic capital allocation, and the fraud cycle that always follows a boom.

We also examine why recessions have become ultra-rare, how heavy global deficit spending masks true economic weakness, and what it means for future downturns. Matt explains Joseph Schumpeter’s “creative destruction,” Howard Marks’ view that the belief in no risk creates risk, and the consequences of labor hoarding highlighted in a timely Barron’s op-ed.

The episode closes with a forward-looking discussion on Berkshire Hathaway as Warren Buffett steps back from communications and Greg Abel assumes a larger role — including what Berkshire might look like with $350B in cash and a more conventional CEO.

???? Books Mentioned:

— Security Analysis (7th Edition, 2023), edited by Seth Klarman - https://amzn.to/3KciCgj

— The Intelligent Investor, Benjamin Graham - https://amzn.to/48Zg7bl

— The Most Important Thing, Howard Marks - https://amzn.to/487QJPD

(As an Amazon Affiliate I can earn from qualifying purchases.)

TIMESTAMPS

00:00 — Intro

01:02 — The Economist: 7 Deadly Sins of Corporate Exuberance

06:11 — 90s and 2000 Corp Scandals

07:03 — Why Recessions Have Become Ultra Rare

09:08 — Howard Marks: “The belief there is no risk is what creates risk”

10:46 — Barron’s: Op-Ed Labor Hoarding — Is It Ending?

12:43 — Buffett Steps Back: Berkshire’s Next Chapter

14:26 — Greg Abel Big challenge

18:03 — Security Analysis Book Recommendation