During their recent episode, Taylor, Carlisle, and Dan Rasmussen discussed Is the America’s Obsession with Hype: Growth Fantasies, Meme Stock Mania, and Bitcoin Fever. Here’s an excerpt from the episode:
Tobias: Given that it’s been a long time since value’s really driven the markets, why do you think that would– Cliff Asness wrote this great piece over the weekend. He said–
Jake: That was hilarious.
Tobias: He imagines what the world will be like in 10 years’ time. I read that. I thought the [chuckles] only problem was this, is that it assumes some return to sanity over the next decade. And if I look back over the last decade, there certainly was no return to sanity then. So, why do you think now might be the time?
Dan: Yeah. Well, I think you have to segment out US international, because value actually has worked quite well internationally. Really the dramatic slap you in the face and kick you into the curb underperformance of value has all been in the US. I think that’s because the extraordinary outperformance of growth has been concentrated in the US. Bitcoin seems to be primarily, or at least originally to a large extent a US investor phenomenon. All the Mag 7 names. AI, ChatGPT, you name it.
The only thing that you can think of that isn’t that way is Novo Nordisk and the GLP-1s. But Lilly has one too. So, I think the bulk of the innovation has come in the US and the bulk of the irrational, in my mind, exuberance around these certain ideas has been in the US. The rise of meme stock trading. All the meme stocks are in the US. There’s no European meme stock or some company on the Paris Exchange is a 5000X, because some random Jacobin and had eating croissants [Jake laughs] at in a cafe is pumping the stock on his video blog. It just isn’t happening.
Tobias: [laughs]
Dan: And so, I think that you got to say value still works. Value is still working. We just have an extraordinary set of specific things– And not a huge number of them in the United States that are driving those factors to not work in the US right now.
Tobias: The problem with the French is they haven’t been able to come up with a competitor for FARTCOIN.
Dan: [laughs] Yeah. My primary portfolio is now 50% FARTCOIN, 50% Nvidia.
Jake: Is that the innovation that they’re lacking in continental Europe?
[laughter]
Dan: Exactly.
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