WEBVTT - Single Best Idea with Tom Keene: Chuck Clough & Katy Kaminski

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news. The single best idea

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<v Speaker 1>and one of the great, single best ideas we have,

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<v Speaker 1>is we pay attention to people from decades back. We

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<v Speaker 1>get it right, sometimes get it wrong, but more often

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<v Speaker 1>than not give us the benefit of experience. Chuck Clow

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<v Speaker 1>is a legend. He's out of New England. He's worked

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<v Speaker 1>for old colonial management. There's a name from the past

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<v Speaker 1>in Boston, iconic at merilynch There is no other way

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<v Speaker 1>to put it. Huge influence within equity strategy and having

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<v Speaker 1>the courage to be in the market. He's a bull.

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<v Speaker 1>We spoke to Chuck Clow today and of course he

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<v Speaker 1>went back to one of his core theories, study demographics.

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<v Speaker 2>Let's look at the events that created forty years of

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<v Speaker 2>declining interest rates and declining inflation, and of course that

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<v Speaker 2>was interrupted by COVID and the tremendous government response to that,

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<v Speaker 2>but those three factors were one demographics. As people aged,

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<v Speaker 2>they get older. We've seen that in Japan for thirty years,

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<v Speaker 2>and we started seeing that in Europe in the early teens,

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<v Speaker 2>and now we're seeing it in the United States where

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<v Speaker 2>we are seeing the baby boomers retire. And once you retire,

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<v Speaker 2>you stop spending. You don't buy houses, you don't buy cars.

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<v Speaker 2>So it's one of the reasons why we think we're

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<v Speaker 2>beginning to see a net savings balance in the household sector,

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<v Speaker 2>and of course that'll only pick up as the baby

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<v Speaker 2>boomers really really do retire. And the second thing, of course,

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<v Speaker 2>is where balance sheets are. Private debt is still one

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<v Speaker 2>hundred and fifty percent of GDP, and that means his

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<v Speaker 2>interest rates do go up, it slows and spending. We're

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<v Speaker 2>seeing that in credit cards. And then thirdly there's technology,

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<v Speaker 2>which of course is booming today. It's one investment cycle

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<v Speaker 2>we have. You put those three things together, they only

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<v Speaker 2>become more intense as we go through the rest of

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<v Speaker 2>the decade. So I wouldn't give up financial assets yet.

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<v Speaker 1>Check clout Optimistic and of course mentioning technology there as well.

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<v Speaker 1>What a joy yesterday. Thank you for the many comments

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<v Speaker 1>worldwide on our conversation. Too brief was Simon Johnson at

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<v Speaker 1>the Massachusetts Institute of Technology. Exciting day yesterday for MIT

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<v Speaker 1>in Chicago, looking at the technology overlay, the institutional overlay

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<v Speaker 1>of our economy and of our economics. We followed that

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<v Speaker 1>up today with someone with Operational Research Excellence from MIT.

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<v Speaker 1>Katherine Kaminsky is just wonderful about the market, the trends

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<v Speaker 1>that are out there. She says, it's very hard right now,

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<v Speaker 1>particularly in fixed income, to make trend investments. Got into

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<v Speaker 1>a lot of the nuances of that. But near the

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<v Speaker 1>end of our conversation, I noticed that Katie Kaminsky teaches

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<v Speaker 1>it slow. I asked her about Simon Johnson. I asked

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<v Speaker 1>her about the air at Sloan at.

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<v Speaker 3>MIT, I'm so excited, and you may not know this,

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<v Speaker 3>but I actually spent ten years of my career in Sweden,

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<v Speaker 3>so where they kind of also do the Nobel Prize,

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<v Speaker 3>and it's just it's just such an amazing place where

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<v Speaker 3>people are really changing the world. And MIT for me,

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<v Speaker 3>just seeing that we had the JOIN conference was at

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<v Speaker 3>MIT last week, a journal of Investment Management, and we

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<v Speaker 3>had two of our junior quants there and they actually

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<v Speaker 3>saw Johnson speak before this weekend. So this is like,

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<v Speaker 3>it's a very pride moment for us.

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<v Speaker 1>Katie Kaminski too short a conversation on her Sloan school

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<v Speaker 1>att t We're going to take a sabbatical here on

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<v Speaker 1>single best idea over the next summer days. I've got

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<v Speaker 1>a dashed room in back the obligatory Roman wedding, I

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<v Speaker 1>threatening to drive a Vespa. We'll see if we can

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<v Speaker 1>work that out where we do a photo shoot, where

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<v Speaker 1>they'll go You're no Greg Peck, but we will see

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<v Speaker 1>on that. What we can tell you is these are

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<v Speaker 1>exciting times into the election. Of course, our conversation with

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<v Speaker 1>the Prime Minister of the United Kingdom yesterday at Bloomberg,

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<v Speaker 1>a conversation today with presidential candidate Donald Trump will much

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<v Speaker 1>more on that unbalance of power. We're out on YouTube.

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