Excess Returns

In this episode of Excess Returns, we sit down with Gary Mishuris, Managing Partner and CIO of Silver Ring Value Partners, to explore how deep fundamental analysis, behavioral insight, and disciplined process come together in real-world investing. Gary shares formative lessons from his early career at Fidelity during the post-tech bubble period, including firsthand experiences learning from legends like Peter Lynch, and connects those lessons to how he evaluates value, quality, and mispricing today. The conversation spans a detailed case study on Warner Bros. Discovery, portfolio construction under uncertainty, selective use of options, and how artificial intelligence is reshaping the research process for long-term investors.

Topics covered in this episode
• Lessons from Peter Lynch and Fidelity on why “just cheap” does not work
• The Silver Ring origin story and how early life experiences shaped a value investing mindset
• Warner Bros. Discovery as a good business plus bad business mispricing case study
• How hated stocks, spin-offs, and catalysts can unlock hidden value
• Conviction, position sizing, and staying rational when the market disagrees
• When and why options can be used in a value investing framework
• Auctions, ego, and why prices can overshoot intrinsic value
• The role of mental models like reflexivity, activation energy, and lollapalooza effects
• How AI fits into an investment research process without replacing judgment
• What average investors should understand about incentives and simplicity

Timestamps
00:00 Introduction and why “just cheap” does not work
02:20 Early career at Fidelity and lessons from Peter Lynch
07:40 The Silver Ring story and learning what real value means
12:00 Warner Bros. Discovery and the good company bad company problem
18:30 Conviction, mispricing, and maintaining discipline in hated stocks
26:40 Using options selectively and managing portfolio-level risk
34:10 Auctions, ego, and when price can detach from intrinsic value
44:30 Entertainment, media disruption, and evergreen demand for content
49:50 How AI is changing equity research and idea generation
55:40 What AI can see that humans often miss
01:00:30 One lesson for the average investor

In this episode of Excess Returns, we sit down with Mike Green of Simplify Asset Management for a deep dive into how passive investing has reshaped market structure, altered price discovery, and created new sources of systemic risk beneath the surface of today’s equity markets. Mike explains why index funds are not as passive as most investors believe, how daily flows drive prices in increasingly inelastic markets, and why the growth of passive strategies may be pushing markets toward an unstable endpoint. The conversation also explores macro implications, AI-driven capital spending, demographic shifts, and what all of this means for investors navigating the years ahead.

Topics covered

• How passive investing and ETF flows actively influence market prices

• The inelastic market hypothesis and why markets absorb flows differently than investors expect

• Why index funds no longer fit the classic definition of passive investing

• The growing share of passive ownership and what happens as it continues to rise

• Potential market instability and the theoretical limits of passive dominance

• How demographics, retirement flows, and 401k defaults affect market structure

• Critiques of arguments downplaying the impact of passive investing

• Why large-cap concentration keeps increasing despite slowing fundamentals

• Implications for active management, stock selection, and liquidity

• The role of AI, capital expenditures, and energy constraints in the macro outlook

• What rising electricity demand and infrastructure investment mean for the economy

• Housing market distortions, demographics, and long-term structural challenges

Timestamps
00:00 Introduction and why passive investing is not truly passive
03:00 The inelastic market hypothesis explained
06:00 Daily flows, index funds, and price impact
08:20 How much of the market is now passive
11:40 What happens if passive investing keeps growing
14:20 Retirement flows and demographic effects on markets
19:00 Responding to critiques of passive market impact
23:00 Liquidity, concentration, and large-cap dominance
27:00 Why market cap does not equal liquidity
33:00 Active management under pressure
38:00 Current market conditions and early-year rotations
41:50 Economic growth, GDP, and underlying volatility
43:30 AI capex, overinvestment, and market incentives
47:00 Energy, electricity demand, and long-term constraints
52:40 Housing, demographics, and policy challenges

This episode of Excess Returns features Gene Munster and Doug Clinton breaking down their 2026 technology and market predictions, with a deep focus on artificial intelligence, big tech, and where investors may be misreading the current cycle. The conversation explores how far along the AI bull market really is, what fundamentals still support it, and where the biggest opportunities and risks may emerge over the next several years. Munster and Clinton discuss market structure, capital spending, valuation, and technological inflection points across AI, software, hardware, and autonomous driving, offering a grounded but forward-looking framework for long-term investors.

Main topics covered

• Why the AI bull market may still have multiple years left and how fundamentals support current valuations

• Nasdaq return expectations through 2026 and what earnings and multiples imply for investors

• The case for small-cap and non–Mag Seven tech outperforming as the AI cycle matures

• Hyperscaler AI capital spending and why CapEx growth could exceed current expectations

• Whether AI pricing pressure leads to commoditization or expanding long-term value creation

• How AI is changing the economics of infrastructure, platforms, and asset-heavy tech businesses

• Apple’s AI strategy, the future of Siri, and why expectations matter for valuation

• Alphabet, Amazon, and the evolving AI competition among the largest technology companies

• Energy constraints, data centers, nuclear power, and the infrastructure needed to support AI growth

• Tesla, Waymo, and the realistic timeline for autonomous driving and robotaxi adoption

• How physical AI, autonomy, and robotics could reshape transportation and consumer behavior

Timestamps
00:00 AI cycle outlook and why the bull market may still be early
05:00 Nasdaq return expectations and earnings fundamentals
10:30 Small-cap tech versus Mag Seven performance
17:15 Hyperscaler AI CapEx and Nvidia’s signals
24:00 Infrastructure, pricing power, and AI commoditization debates
32:30 Apple, Siri, and consumer AI assistants
38:50 Alphabet, Amazon, and AI competition among mega-cap tech
45:00 Energy, data centers, and nuclear power considerations
48:10 Tesla, autonomy, and robotaxi timelines
54:15 Waymo, market share, and the future of transportation

In this episode of Excess Returns, Professor Aswath Damodaran joins Matt Zeigler and Kai Wu for a wide-ranging conversation on valuation, portfolio construction, and how investors should think about risk, discipline, and opportunity in a market shaped by AI, market concentration, and rising uncertainty. Damodaran walks through how he builds and manages his own portfolio, why price matters more than story or quality, and how AI-driven capital spending could reshape margins and returns across the economy. The discussion blends practical investing frameworks with big-picture market insights, offering a clear look at how a valuation-driven investor navigates today’s environment.

Main topics covered
• How Aswath Damodaran builds a stock portfolio, including diversification, position sizing, and turnover
• Why investing is about buying at the right price, not buying great companies
• Using valuation frameworks to invest in young, unprofitable, and fast-growing companies
• How stories and narratives fit into valuation without replacing financial discipline
• Watchlists, patience, and waiting for price rather than chasing popular stocks
• Sell discipline, overvaluation triggers, and avoiding emotional attachment to winners
• Using probability distributions and simulations instead of single-point estimates
• How company lifecycles affect growth, margins, and capital allocation decisions
• Why many companies struggle as they age and how management quality shows up late in the lifecycle
• AI as a capital cycle and why massive AI investment may lower margins overall
• Why AI is likely to create a bubble, even if it delivers long-term economic value
• Winners and losers in the AI value chain, from infrastructure to applications
• Risks from AI infrastructure spending, debt, and cross-ownership structures
• Why private markets may not deliver better outcomes for individual investors
• How Damodaran thinks about cash, diversification, and assets uncorrelated with equities
• Reentering markets after selling and avoiding the trap of staying in cash too long
• Time horizon, legacy investing, and managing wealth across generations

Timestamps
00:00 Investing is about price, valuation, and early thoughts on AI and market risk
01:54 Personal investing philosophy and why portfolios must be investor-specific
03:00 Diversification, number of holdings, and managing downside risk
05:00 Valuation frameworks and buying companies at the right price
06:00 Stories versus numbers and avoiding the circle of competence trap
08:20 Political risk and why some sectors are hard to value
08:47 Watchlists, patience, and waiting for price to meet value
11:43 When and why to sell stocks as a value investor
12:00 Using probability distributions and simulations in valuation
15:48 Sell discipline, fund flows, and separating skill from luck
18:00 Company lifecycles, aging businesses, and management discipline
23:18 Apple, Meta, and contrasting approaches to AI investment
24:08 AI bubbles, winner-take-all dynamics, and capital cycles
27:48 Infrastructure investing, debt risk, and societal spillovers
32:20 Cross-ownership risks and AI ecosystem fragility
35:00 AI’s impact on profit margins and competition
39:41 Where AI value may accrue over time
44:38 AI tools, valuation bots, and the rise of investment scams
49:17 Private markets, alternatives, and cost structures
53:05 Cash, collectibles, and diversification beyond equities
56:33 Reentering markets after selling and avoiding market timing traps
58:35 Time horizon, legacy investing, and generational wealth

In this episode of Excess Returns, we welcome back Liz Ann Sonders to discuss the evolving market and economic landscape heading into 2026. The conversation focuses on why this cycle feels fundamentally different, how instability rather than uncertainty is shaping investor behavior, and what that means for inflation, the labor market, Federal Reserve policy, and equity markets. Liz Ann breaks down the growing bifurcation across the economy and markets, the shift away from the Great Moderation era, and how investors should think about diversification, earnings, valuations, and AI-driven capital spending in a more volatile and fragmented environment.

Main topics covered
• Why today’s environment is better described as unstable rather than uncertain
• The K-shaped economy and growing bifurcation across consumers, sectors, and markets
• Inflation dynamics and why 2 percent may now be a floor rather than a ceiling
• How deglobalization, supply chains, and tariffs are changing the inflation regime
• The shifting relationship between stocks and bonds
• Hard data versus soft data and what sentiment is really telling us
• The labor market’s headwinds and tailwinds, including immigration and hiring trends
• AI’s impact on productivity, jobs, and capital spending
• The AI capex boom and how it differs from the late 1990s tech cycle
• Earnings growth, valuation compression, and market broadening
• Rolling recessions versus traditional economic downturns
• Federal Reserve challenges under a conflicted dual mandate
• Why factor-based investing matters more than sector or style calls

Timestamps
00:00 Introduction and why this cycle feels different
02:00 Uncertainty versus instability in markets
03:30 The K-shaped economy and market bifurcation
07:00 Market broadening, small caps, and diversification
09:00 Inflation measurement challenges and data reliability
12:00 Why inflation may stay above 2 percent
15:00 Stock and bond correlations across cycles
17:30 Labor market crosscurrents and immigration effects
20:45 AI, productivity, and entry-level job pressures
24:30 Sentiment versus fundamentals in markets
27:30 Retail trading, behavior, and market psychology
31:00 Rolling recessions and post-pandemic distortions
38:00 Technology, cyclicality, and sector rotation
40:30 The Fed’s policy dilemma and internal disagreements
45:00 AI capital spending and comparisons to the dot-com era
51:00 Earnings growth versus valuation expansion
55:00 Factors, GARP, and portfolio positioning for 2026

This episode of Excess Returns features a wide ranging conversation with Grant Williams on what he calls the hundred year pivot. Grant explains why today’s environment feels fundamentally different from the last several decades, why long held investing assumptions may no longer apply, and how declining trust in institutions, money, and markets is reshaping the global financial system. Drawing on history, macroeconomics, and decades of market experience, the discussion explores what this transition means for investors trying to navigate a world defined by uncertainty, volatility, and structural change.

Main topics covered
• What the hundred year pivot means and why it represents a once in a generation shift
• The Fourth Turning framework and how it connects financial crises, politics, and social change
• Why buy the dip worked for decades and why it may fail in the years ahead
• The erosion of trust in institutions and its impact on markets and money
• The financial crisis, sanctions, and the freezing of sovereign assets as turning points
• The role of the dollar, gold, and central banks in a changing monetary system
• Lessons from history including Bretton Woods and the Suez crisis
• Why commodities and real assets matter in a world of deglobalization and reshoring
• How artificial intelligence fits into the current investment cycle and capital allocation boom
• Portfolio construction and behavioral challenges in a higher volatility environment

Timestamps
00:00 The hundred year pivot and why this cycle is different
01:30 Defining the Fourth Turning and historical cycles
07:40 The financial crisis as the start of institutional breakdown
11:00 Sanctions, sovereign assets, and the end of unquestioned trust in the dollar
18:20 Historical parallels from Bretton Woods and the Suez crisis
24:50 What could trigger a broader monetary reset
28:50 Energy, geopolitics, and shifting global alliances
35:00 Commodities, real assets, and rebuilding supply chains
42:40 Artificial intelligence, capital cycles, and uncertainty
52:30 Portfolio construction, behavior, and risk tolerance
59:50 Where to follow Grant Williams and his work

In this episode of Excess Returns, we dive deep into one of the most pressing investing debates today: how to think about valuations, profit margins, and artificial intelligence in a market that feels both expensive and transformative. Sam Ro joins Matt Zeigler and Kai Wu for a wide-ranging conversation that explores whether traditional valuation tools still matter, how AI is reshaping corporate economics, and why history suggests investors should be cautious about bubble narratives even when enthusiasm runs high. From profit margins and capital intensity to the future of the Magnificent Seven, this episode focuses on how long-term investors can frame uncertainty without relying on false precision or short-term market calls.

Timestamps
00:00 Valuations, bubbles, and why timing markets is so hard
01:41 Do valuations still matter for investors
05:58 S&P 500 valuation levels versus history
09:30 Profit margins and why mean reversion has not shown up yet
14:39 Household finances, pricing power, and consumer resilience
15:47 AI, productivity, and the limits of forecasting economic impact
19:15 Valuations adjusted for structurally higher profit margins
21:15 Tech multiples, growth expectations, and PEG ratios
24:07 Are we in an AI bubble and why that question may not help
29:14 Lessons from past bubbles and irrational exuberance
30:14 How transformative AI could be compared to past innovations
35:20 Massive AI capital spending and the risk of overbuild
39:42 Who captures value in AI: builders versus users
46:39 Revenue per worker and productivity trends
48:00 Dispersion inside the Magnificent Seven
51:34 Big tech shifting from asset-light to asset-heavy models
59:53 Turnover among top companies over time
01:01:10 Why Wall Street price targets miss the point
01:04:30 Presidential cycles and market returns
01:06:28 Fund manager surveys and why popular risks are often lagging indicators

Topics covered
How investors should think about valuations over long time horizons
Why elevated profit margins may be more structural than cyclical
The role of AI in productivity, earnings, and competitive dynamics
Bubble psychology and lessons from the dot-com era
Capital intensity, overinvestment, and the risk of write-downs
Why AI infrastructure builders may not capture most of the value
What dispersion within the Magnificent Seven signals for markets
Why broad diversification still matters in a rapidly changing market

In this episode of Excess Returns, Katie Stockton of Fairlead Strategies joins Matt Zeigler and Justin Carbonneau to walk through her technical outlook for markets as we head into 2026. The conversation focuses on trend analysis, momentum, volatility, and risk management across U.S. equities, sectors, international markets, and alternative assets. Rather than making predictions, Katie explains how she reacts to price, confirms signals, and uses a disciplined technical process to identify opportunities and manage downside risk in changing market environments.

Main topics covered
Market trend outlook for U.S. equities heading into 2026
Why long-term trends remain constructive despite rising short-term risks
How to think about volatility, consolidation, and corrective phases
What loss of momentum in late 2025 signals for near-term positioning
How to use triangle formations, support, and resistance levels
Understanding DeMark indicators, MACD, and stochastic signals
Leadership shifts within large-cap technology and the Mag 7
Growth versus value dynamics across market caps
Small caps, market breadth, and participation signals
Sector rotation insights including technology, healthcare, financials, energy, utilities, and real estate
How sentiment indicators like fear and greed fit into a broader process
Gold, silver, and precious metals trends and volatility
Bitcoin and crypto from a technical perspective
The U.S. dollar, yields, and global market implications
International and emerging market opportunities
How the Fairlead Tactical Sector ETF is constructed and used in portfolios
Where a tactical, risk-managed strategy can fit within asset allocation

Timestamps
00:00 Market setup and trend perspective for 2026
01:25 Long-term uptrend versus short-term risk
04:16 Momentum loss and near-term caution
06:00 Nasdaq 100 triangle and volatility setup
07:45 Ichimoku clouds and trend confirmation
11:01 Using consolidation and support levels
13:05 Tech leadership and relative strength shifts
18:30 Small caps, breadth, and market participation
21:01 Growth versus value across market caps
23:00 Market breadth and advance-decline signals
24:13 Sentiment, fear and greed, and retests
30:00 Breakouts, catalysts, and confirmation
32:00 Sector rotation overview
35:00 Energy, real estate, and rate-sensitive sectors
39:10 Fairlead Tactical Sector ETF strategy
45:00 International and emerging markets
47:36 Gold, silver, and precious metals
51:04 U.S. dollar and currency trends
54:00 Bitcoin and crypto technical outlook
57:12 Key indicators to watch going forward
59:07 Long-term takeaways for investors

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In this episode of the Jim Paulsen Show, Jim Paulsen joins Jack Forehand and Justin Carbonneau to break down what the economy and markets may really be signaling beneath the headline numbers. Drawing from his recent outlook and long history studying market cycles, Jim explains why growth may be weaker than it appears, how policy lags are shaping the outlook, and why today’s market looks very different from past late-cycle environments. The conversation explores the divide between the “new era” economy and the rest of the market, what that means for investors in 2026, and where opportunities may be emerging as monetary and fiscal policy begin to shift.

Topics covered in this episode
• Why headline GDP growth may be overstating the true strength of the economy
• How trade distortions are affecting recent GDP data
• The concept of a “no-shaped economy” and the divide between new era and old era businesses
• Labor market signals that suggest economic sluggishness beneath the surface
• Why this may be one of the most disliked bull markets in history
• The role of policy lags and why easing could matter more than investors expect
• How market concentration has shaped returns over the last several years
• Warning signs emerging within the technology sector
• The relationship between corporate cash levels, R&D spending, and tech leadership
• Why market breadth and old era sectors may become more important going forward
• Thoughts on bonds, stocks, commodities, gold, and portfolio positioning
• Why international and emerging markets could benefit from a weaker dollar
• How investors might think about diversification in an unusual market cycle

Timestamps
00:00 Introduction and key themes from Jim’s outlook
03:00 Why the economy may be weaker than GDP headlines suggest
06:00 Labor market signals and recession-like dynamics
12:00 Policy lags, the Fed, and why growth could soften further
15:00 Market performance after multiple strong years
18:00 The no-shaped economy and the split between new era and old era
24:00 Strange market signals at all-time highs
27:00 Valuations, sentiment, and why pessimism matters
29:00 Fed easing expectations and consensus forecasts
35:00 Warning signs for technology stocks
42:00 Corporate cash, R&D spending, and tech leadership risks
47:00 Portfolio construction and asset allocation thinking
55:00 Final thoughts on opportunities and risks ahead

In this wide-ranging conversation, Gautam Baid joins Excess Returns to discuss the principles that shaped his investing philosophy, the lessons learned through bear markets, and why compounding, patience, and quality matter far more than forecasts or short-term performance. Drawing from his books The Joys of Compounding and The Making of a Value Investor, Baid shares a deeply reflective framework for long-term investing, portfolio construction, behavioral discipline, and global diversification, with insights spanning Indian and US markets, liquidity cycles, AI, and investor psychology.

Main topics covered
• The asymmetric power of compounding and why being wrong half the time can still lead to exceptional long-term returns
• Why patience, temperament, and behavior matter more than analytical precision in investing
• The role of journaling in improving decision-making and avoiding repeated behavioral mistakes
• How investor sentiment reveals itself through IPO markets and portfolio quality late in bull cycles
• Why long-term investing requires continuous monitoring rather than buy-and-forget complacency
• Letting winners run, cutting losers, and understanding power-law outcomes in stock markets
• Liquidity cycles and how they drive market returns in both India and the United States
• How bear markets reshape investing philosophy toward resilience, quality, and diversification
• When averaging down makes sense and when it is dangerous
• The differences between Indian and US equity markets, valuations, and governance
• Why home country bias can be a major risk for US-based investors
• AI, productivity, profitability, and where future market winners may emerge beyond mega-cap tech
• Why passion for investing matters more than money in sustaining long-term success

Timestamps
00:00 Introduction and the asymmetric nature of compounding
01:00 Gautam Baid’s investing background and books
03:00 The importance of journaling and learning through bear markets
06:00 Investor sentiment, IPOs, and late-cycle market behavior
10:20 Long-term investing versus complacency and monitoring risk
14:15 Convex upside, concave downside, and letting winners run
18:30 Liquidity cycles and lessons from Stan Druckenmiller
22:45 Identifying market bottoms and the anatomy of bull and bear markets
28:00 Averaging down, quality, and risk management
30:30 How bear markets change investor psychology and strategy
33:00 Patience, management quality, and long-term optionality
36:15 Mr. Market, price signals, and market intelligence
39:00 The Federal Reserve, inflation, and asset price dynamics
44:00 Understanding the Indian equity market and valuation structure
46:45 Why global diversification matters for US investors
50:30 AI, margins, and the future of value investing
53:00 Passion, purpose, and the psychology of long-term investing
54:30 The single most note investors should learn