“Hey! Please don’t touch!”
I didn’t even realize I was touching the $100,000,000 robot, but I sure was. I got invited to Yahoo! Finance’s Invest 2023 conference – an intimate gathering of just over 100 people who got to see Morgan Housel (my old Motley Fool colleague who has a new book out called Same As Ever), SkyBridge Capital founder Anthony Scaramucci, “Dr. Doom” Nouriel Roubini, Meredith Whitney, Olympic gold medalist Lindsey Vonn, DoubleLine founder Jeffrey Gundlach, and more.
Robotics company Boston Dynamics CEO Robert Playter brought a robot (I forgot its name, but it was something like “Stretch”). I don’t think Stretch himself – let’s pretend that’s his name – cost $100 million to make, but rather that Robert was referring to the years of R&D costs that culminated in Stretch. And by the way, Stretch failed several times to pick up a ball on the floor, prompting Robert to underscore his prediction that humanity is still very, very far from the possibility of killer autonomous robots.
Yahoo! Finance did a great job of inviting both bulls and bears, investors and personal finance types alike – a nicely mixed speaker lineup, so there are, by design, no universal takeaways from the conference. Here’s what stood out.
Nouriel Roubini: US economics are disconnected from public perception
Until recently, real wages were growing slower than inflation, so Americans tend to think the US economy is worse than it is. Roubini pointed out the huge divide (illustrated by the Yahoo! Finance charts below, which where shown at the conference) between Democrats and Republicans on economics issues – Republicans tend to think the US economy is doing poorly, whereas Democrats tend to think it’s doing better, but both sides seem more bearish than reality.
Roubini noted that economic data points to a soft landing, although a short and shallow recession is possible, which could be damaging for Joe Biden. Consumer confidence is likely to improve over time.
Anthony Scaramucci: Still bullish on Bitcoin despite FTX
Scaramucci comes across as a straight shooter, and this conference was no exception. He said that unlike many VCs and others who associated with Sam Bankman-Fried and who are now hiding and dodging questions on him, he admits that he made a mistake and was fooled – that’s just part of business.
Importantly, “the Mooch” – a self-made financier who was also the White House Communications Director for 10 days in 2017 – is still bullish on bitcoin. His big issue is trying to claw the 30% of his firm he sold to SBF back.
Jeffrey Gundlach: Recession in 2024
“If only they had followed my advice last year…”
DoubleLine founder Jeffrey Gundlach regarding the US Federal Reserve not swiftly hiking rates by 200 basis points early on.
Billionaire Gundlach is known as a hawk, and he spent a fair bit of time griping Stanley Druckenmiller-style about the US’ deficit spending, the concern that half the US’ federal debt, which is currently around a weighted average interest rate of 3%, will need to be rolled over in the coming three years, presumably at meaningfully higher rates. Gundlach worries that interest expense on the US’ federal debt could suck up as much as half of tax receipts by 2028, and think’s we’ll be in a recession by the second quarter of 2024 – if we aren’t in one already.
Gundlach, like Druckenmiller, believes entitlement spending is simply too high and must be cut.
Meredith Whitney: No recession in 2024
Meredith Whitney was right about the 2008 financial crisis, but wrong about a municipal bond meltdown that never happened.
Unlike Gundlach, she sees no recession, but does see a problem that 70% of US houses are owned by people 50 and over. The “avocado toast” crowd, as she calls Millennials, is largely frozen out of home ownership, and thus didn’t experience the massive wealth gains from home price appreciation the Boomers and older Gen Xers did. AARP estimates that 51% of people over 50 downsize to smaller homes – and downsizing is frequently done with cash, making it rate-agnostic. She calls this trend the “Silver Tsunami;” the last of the Baby Boomers will turn 65 soon.
To underscore Meredith’s affordability point, I’ll show a slide from a session with Haley Sacks (from Finance is Cool) and Tonya Rapley (from My Fab Finance). Although I regrettably didn’t get to hear all of this session, I got a shot of an amazing, if foreboding, stat:
Morgan Housel: Save like a pessimist; invest like an optimist
I’m biased because I know (and like) Morgan from our time together at The Motley Fool. Then again, everybody likes Morgan. It’s probably impossible to summarize his interview because he replies with a series of vignettes and witticisms, but one thing notably absent: any real plugging (by Morgan) of his new book, Same As Ever, which literally released that very day. A classically trained publicist or PR advisor would be shocked – Yahoo! Finance is the largest internet investing property by visitors in the US – but Morgan is that one guy who didn’t let success get to his head.
John Stankey: Inflation is worse than high interest rates
AT&T CEO John Stankey won’t win any motivational speaker awards, but he made up for a pizzazz-less presentation with clarity and authoritative points. John was optimistic about the US consumer – he’s got good data to back that up – and isn’t in the bearish Gundlach (and Druckenmiller, though he wasn’t at the conference) recession camp. John seems OK with high interest rates, reasoning they’re better than high inflation.
And finally, a particularly big thanks to my friends at Yahoo! Finance for not skimping on food. I was hungry. And CAVA Grill CEO Brett Schulman’s attendance (sadly, I didn’t get to hear him speak) may be the reason for the copious quantity of CAVA entrees – which supplemented an ever-change assortment of munchies and passed hors d’oeuvres.
This article is for informational purposes only and is neither investment advice nor a solicitation to buy or sell securities. Investing carries inherent risks. Always conduct thorough research or consult with a financial expert before making any investment decisions. Neither the author nor BBAE has a position in any investment mentioned, and neither receives any compensation from Amazon or Penguin Random House.