Jim Grant calls Steven Bregman, “one of Wall Street’s most interesting thinkers.” I called upon him to share his thoughts on the massive and growing trend to passive investing which he calls, “the greatest bubble ever.” He discusses the differences between the current bubble in the financial markets and prior bubbles, the specific distortions created in the markets and the unique opportunities they present. Perhaps most importantly, Steven reveals the little-discussed structural shift in passive investing which dramatically devalues it as a strategy and how investors have been deceived by historical return figures that are not applicable to the products they own today. We also get into his personal history in the financial industry along with his evolution as an investor and more. Here are a few notes and links related to the episode:
- Horizon Kinetics website
- Steven’s presentation at the Grant’s Interest Rate Observer Fall 2016 conference
- The slides from that presentation at GrantsPub.com
- A Lesson on Elementary, Worldly Wisdom As It Relates To Investment Management & Business Charles Munger, USC Business School, 1994
- The Warren Buffett yardstick on FRED
- Finding stocks outside the purview of the indexes: Screen for sectors and stocks with low float (high insider ownership) and lower-than-average daily trading volume using a tool like this.
- Is There a Dark Side to Exchange Traded Funds? An Information Perspective
- Horizon Kinetics’ Wealth Index
