Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

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Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by Rick Ferri » Mon Jun 01, 2020 6:57 am

LINK TO PODCAST:

Episode 22: Bogleheads on Investing – guest Dr. Ed Yardeni, host Rick Ferri

Dr. Ed Yardeni is a long-time veteran of the investment industry and the President of Yardeni Research, Inc., a provider of global investment and asset allocation research. He previously served as Chief Investment Strategist at Oak Associates, Prudential Equity Group, and Deutsche Bank’s US equities division in NYC, and was also the Chief Economist of CJ Lawrence, Prudential-Bache Securities, and EF Hutton. Ed started his career as an economist with the Federal Reserve Bank of NY and held positions at the Federal Reserve Board of Governors and the US Treasury Department.

Ed completed his undergraduate studies magna cum laude at Cornell University and earned his Ph.D. in economics from Yale University in 1976. He is frequently quoted in the financial press, including The Wall Street Journal, the Financial Times, The New York Times, The Washington Post, and Barron’s. He appears frequently on CNBC and Bloomberg Television. This podcast highlights his new book, Fed Watching for Fun and Profit.

This podcast is hosted by me, Rick Ferri, CFA, a long-time Boglehead and investment adviser. This podcast is supported by the John C. Bogle Center for Financial Literacy, a non-profit organization approved by the IRS as a 501(c)(3) public charity on February 6, 2012.
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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by CyclingDuo » Mon Jun 01, 2020 8:23 am

Well done, Rick. It was a very interesting interview.

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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by Rick Ferri » Mon Jun 01, 2020 12:24 pm

The Fed is operating in the Twilight Zone. It's become a black hole, consuming every asset in sight and distorting market prices. How does it end?

Listen to my podcast and Dr. Ed Yardeni as we discuss the unprecedented Fed action of QE Forever! :happy
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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by Leesbro63 » Mon Jun 01, 2020 12:37 pm

I found the podcast interesting. A lot to think about and he's very intelligent. I do, however, keep thinking about his wildly faulty Y2K prediction which reminds me of Jack Bogle's adage: "Nobody knows nuthin'".

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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by packer16 » Mon Jun 01, 2020 12:37 pm

Rick Ferri wrote:
Mon Jun 01, 2020 12:24 pm
The Fed is operating in the Twilight Zone. It's become a black hole, consuming every asset in sight and distorting market prices. How does it end?

Listen to my podcast and Dr. Ed Yardeni as we discuss the unprecedented Fed action of QE Forever! :happy
Good podcast. Is Fed a black hole distorting market prices or is it just that the Fed is buying some but not a majority of these assets? Also, is the Fed leading or is it just enhancing or pulling forward trends already in the place & have been in place for centuries per Schmelzing?

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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by Stinky » Mon Jun 01, 2020 1:14 pm

Absolutely excellent podcast. Every Boglehead should listen to this one.

Yardeni describes a Fed that “saved the economy” back in 2008. However, rather than backing off their stimulus after the crisis was abated, they kept much of the stimulus in place. That left the Fed short on “traditional” stimulus measures when the virus hit, so the Fed has had to invent new ways to save the economy.

I’m just not sure has this all turns out. Will the Fed feel comfortable in reducing the stimulus significantly in 2021, 2022, or later? Are they willing to take the pain that will happen as stimulus is reduced? And, if they keep most of the stimulus in place indefinitely, what new measures can they invent the next time the economy hits a rough patch.

I am old enough to recall the dark times in the late 1970s and early 1980s. Inflation was over 10%, and there seemed to be no end in sight to spiraling prices. Paul Volcker and the Fed made the gutsy move of hiking interest rates to the sky to kill off the inflation. I paid 12% for a 30 year fixed mortgage in 1981 and thought I got a great deal. But the Fed broke the back of inflation, and we saw great prosperity for most of the next 20 years. Short term pain, long term gain.

I just hope that our current Fed has the wisdom of the Volcker Fed.
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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by patrick013 » Mon Jun 01, 2020 1:58 pm

Ed Yardeni certainly has the experience to provide a good
commentary on the economy and the Fed.

His website has current charts on many historical factors.

Besides the Fed watching book he has several other books
available on Kindle format. Nothing better than a good
Fed watching book to at least keep track of the economy
if so desired.

The lowest interest rates and QE buying securities and
perhaps even defaulted mortgage packages again to support
the economy and provide liquidity is open for discussion.

Thanks Rick, a very good post overall.
age in bonds, buy-and-hold, 10 year business cycle

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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by Rick Ferri » Tue Jun 02, 2020 7:56 pm

His analysis of stock buybacks is interesting because he nets out stock that is reissued via restricted stock, stock options, and other executive compensation. The net result is about one-half of the money spent on buybacks among S&P 500 stocks is used to retire stock, and the other half is used as incentives. That means only half the money spent by companies to buy back their stock should be counted as a "buyback dividend."

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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by spottedchococow » Tue Jun 02, 2020 10:31 pm

Enjoyed this podcast. Thank you Rick! :beer

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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by whodidntante » Tue Jun 02, 2020 10:57 pm

Your best ever podcast IMO. Keep it up.

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Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by typical.investor » Wed Jun 03, 2020 12:25 am

Very interesting, but ultimately Dr. Yardeni seems to be calling for a return of the pre-depression era Fed that existed strictly to avoid financial instability.

I guess one could argue that managing the business cycle and QE forever (recent Fed actions) has nothing to do with the goal of maximizing employment, but I somehow see it otherwise as we know recessions stem from credit tightening. It seems logical for the Fed. to take action to avoid a recession.

As for the late 70's/80's and Dr. Yardeni's desire for Volcker clones to continue his policy, it doesn't seem so relevant to today. Volcker's willingness to endure a recession was out of the need to control the inflation that the political influence of keeping rates low to boost employment had caused. We now know that the natural rate of employment isn't really known so is a very undefined target, and that targeting price stability and controlling the money supply is a better approach not only in terms of inflationary impact but also ultimately on employment.

In any case, the Fed abandoning an influence over the business cycle doesn't seem like returning to Volcker, but rather to the pre-depression era Fed. Unless of course you would care to argue that Volcker would stare a deflationary recession in the face and just say fine whatever - employment isn't my concern. Volcker obviously was never posed that question.

Ultimately Dr. Yardeni suggest we might see something similar to Japan with continued QE and likely rising asset prices. Only Japan hasn't seen rising asset prices and P/Es of stocks have come way down and Japanese stocks are their cheapest on record relative to their American counterparts. I suspect that is just from money flowing into the US which has promised growth.

It was a very good podcast. I guess I am just a little skeptical of what seems like the view that the Fed should return to not being involved with doing anything to fulfilling it's responsibilities under the 1935 Employment Act.

As for my personal portfolio, I will take Dr. Yardeni's suggestions about why inflation may not be inevitable into consideration and to keep my eye on the Fed.

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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by bgf » Sun Jun 07, 2020 2:57 pm

great pod! Just picked up Mr. Yardeni's ebook Fed Watching for Fun & Profit for $1.99 on Kindle.
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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by Rick Ferri » Mon Jun 08, 2020 5:49 pm

This week on Wednesday and Thursday, the Kindle version of Ed Yardeni's Fed Watching for Fun & Profit will be available for free.

Free!

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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by Mr.BB » Mon Jun 08, 2020 7:09 pm

It was an excellent podcast. I really enjoyed it, especially his explanation on the different Fed chief's points of view for the Fed's actions.
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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by boglerdude » Mon Jun 08, 2020 8:30 pm

~31 min he says Lehman should not have been allowed to fail, then goes on to condemn bailouts?

Thx, requesting more podcasts on economic history

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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by Rick Ferri » Wed Jun 10, 2020 12:45 pm

boglerdude wrote:
Mon Jun 08, 2020 8:30 pm
~31 min he says Lehman should not have been allowed to fail, then goes on to condemn bailouts?
He as talking about the Fed bailing out companies as opposed to orchestrating that other companies bail out each other, as was the case with Bear Sterns being bailed out by JP Morgan prior to Lehman failing, and Long Term Capital Management in 1997.
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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by LadyGeek » Wed Jun 10, 2020 4:01 pm

Rick Ferri wrote:
Mon Jun 08, 2020 5:49 pm
This week on Wednesday and Thursday, the Kindle version of Ed Yardeni's Fed Watching for Fun & Profit will be available for free.

Free!

Rick Ferri
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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by TechGuy365 » Wed Jun 10, 2020 5:47 pm

Got mine - thank you the the reminder. I really enjoyed this episode of podcast, and such perfect timing.

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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by nedsaid » Sun Jun 14, 2020 12:33 pm

Rick, I listened to this podcast yesterday and I very much enjoyed it. Thank you for your excellent work here.
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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by Miriam2 » Sun Jun 14, 2020 5:46 pm

boglerdude wrote: ~31 min he says Lehman should not have been allowed to fail, then goes on to condemn bailouts?

Thx, requesting more podcasts on economic history
Yes, I would appreciate a podcast on the Lehman decision & its repercussions, and also on The Great Depression.

Thanks Rick, all podcasts have been informative - and you're really a very good interviewer :happy

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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by JAZZISCOOL » Tue Jun 16, 2020 7:03 pm

Thanks Rick! I really enjoyed this podcast. I learned a lot about the history of the Fed. It's worth a second listen.

I thought it was funny when he said he should have probably written a book about the virus instead of the Fed (given the timing of his latest book "Fed Watching for Fun & Profit"). :happy

I also noticed in his bio on his firm's website that he was one of the "Top Voices in economy and finance" on LinkedIn in 2019!

https://www.yardeni.com/wp-content/uplo ... o_2018.pdf

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Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

Post by annu » Tue Jun 16, 2020 9:26 pm

Podcast was awesome. Anyone bought the book? Is it interesting, useful read?

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