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16:00
Sep 04
Sep 04
Meb Faber Show
14h
SPY 1ST
USD 1ST
GLD 1ST
XLV 1ST
XLE 1ST
▾
HIGH
Overweight US equities for relative exceptionalism.
Defends US equity exceptionalism and recommends a strategic overweight to US equities within a global equity portfolio. The US is better positioned to exploit AI and IT productivity, has labor flexibility to rationalize workforces, has better demographics than Europe or China, and has benefited from decades of rising profit share of GDP supported by falling effective corporate tax rates. Returns may be lower than history, but still positive in real terms and better than alternatives.
SPY LONG
Hedge or avoid US dollar exposure.
Declines to defend US dollar exceptionalism. Fiscal sustainability concerns, debt service spending crossing over defense spending, geopolitical weaponization of the dollar after the Russia-Ukraine invasion, and BICS de-dollarization attempts make the dollar riskier. He does not expect dollar depreciation against other currencies, but says non-dollar investors should hedge more dollar exposure, and the depreciation story is mainly against gold.
USD AVOID
Own gold as portfolio diversifier.
AllianceBernstein has been strategically overweight gold. Gold is no longer a commodity but money in this environment, benefits from desires to diversify away from the dollar, and has maintained roughly zero correlation with equities across inflation regimes. He uses a long-run real return assumption of about 1% plus support from BRICS and especially Chinese official buying, and sees gold as a key diversifier now that bonds no longer play that role.
GLD LONG
Healthcare offers defensive AI beneficiary exposure.
Healthcare is attractive strategically because it sits at the nexus of diversification, demographics, AI, and valuation. Demographics support demand and sticky pricing power, healthcare is a plausible AI beneficiary, and the sector's P/E relative to the market is low compared with its 20-30 year trading range. Policy uncertainty is a different risk from the AI trade, so healthcare offers defensive equity diversification.
XLV LONG
Use commodities and energy for inflation protection.
There is a strategic case for commodity exposure, including energy and base metals, as a source of real return and inflation protection. Exposure can be gained through direct commodities and through equities linked to those commodities. Energy equities stand out for income and free cash flow. This is separate from gold, which he now treats as money rather than a commodity.
XLE LONG
DBC LONG
Copper benefits from AI and energy capex.
Copper is at all-time highs but not widely discussed. It has structural demand from AI physical capex and the energy transition. Base metals are also part of the portfolio response to expected higher inflation volatility from deglobalization and geopolitics, which should create more supply shocks over time.
COPPER LONG
Hold small silver allocation for diversification.
Silver deserves a small allocation as part of a non-fiat allocation dominated by gold. It is not a fundamental standalone bullish call, but silver is differentiated because investors play a much smaller role in that market than they do proportionally in gold, providing diversification within the non-fiat bucket.
SILVER LONG
Small Bitcoin allocation behind gold.
Bitcoin should be a small part of the strategic non-fiat allocation, dominated by gold. He changed his view during COVID from seeing no role for Bitcoin to accepting a limited asset allocation role. More regulatory and custody clarity could bring in additional investors.
BTC LONG
HIGH
15:45
Aug 28
Aug 28
Technology companies tied to AI capex
Liquid Tech Winners
Taiwanese and Chinese chip manufacturers
SMH 1ST
Frontier AI model companies
▾
HIGH
AI capex will rerate tech into utilities.
Technology companies heavily investing in AI data centers are increasingly relying on external debt financing rather than internal cash flows, saddling them with massive debt and ongoing maintenance capex. They are effectively turning into utility companies but are wildly overvalued compared to orthodox utilities, and will inevitably face a downward valuation rerate to match their new utility-like financial profiles.
Technology companies tied to AI capex SHORT
Mega IPOs will force selling tech winners.
An unprecedented wave of upcoming mega IPOs (like SpaceX and Anthropic), estimated at over $5 trillion, will require institutional investors to free up massive amounts of capital. To fund these purchases, funds will structurally sell their most liquid, best-performing tech holdings that have overlapping factor exposures, putting significant downward pressure on current market winners.
Liquid Tech Winners SHORT
Supply glut will crash semiconductor chip prices.
Unprecedented cash inflows into Taiwanese and Chinese chip manufacturers are setting up a massive tsunami of supply by early 2028. Because semiconductors are a highly capital-intensive boom-bust industry, this locked-in supply will inevitably crash prices as manufacturers dump inventory to cover fixed costs.
Taiwanese and Chinese chip manufacturers SHORT
AI chip design destroys incumbent semiconductor moats.
The narrative of a permanent semiconductor supercycle and an unbreakable GPU duopoly is flawed because AI itself is now being used to design chips. This 'vibe chipping' drastically reduces design verification times and lowers traditional barriers to entry, meaning a flood of new, specialized chips will soon challenge incumbent market leaders and destroy their moats.
SMH SHORT
Model convergence and deflation doom frontier AI.
Frontier AI models are experiencing rapidly diminishing returns in year-over-year performance gains and are converging in capabilities, making them virtually indistinguishable. Combined with the hyper-deflationary nature of AI tokens, these companies must grow unit volumes by 400% just to stand still, making their business models highly toxic and their massive multi-billion dollar training runs unjustifiable.
Frontier AI model companies AVOID
HIGH
15:00
Aug 25
Aug 25
Meb Faber Show
10d
HO_F
FXY 1ST
MFUT 1ST
CL1!
▾
HIGH
Energy could go much higher.
Jerry says they handled energy well and still have good positions. He argues crazy things happening in energy now could push prices a lot higher, and they keep loose trailing stops while remaining long crude oil and heating oil futures.
HO_F LONG
CL1! LONG
Yen downtrend keeps giving.
Jerry says the yen has been a fun trend trade that keeps giving and keeps going down. He notes trend distance can be underestimated, comparing it to a prior Swiss franc versus yen trend that lasted years, and says yen is a good example of a slow and steady downtrend.
FXY SHORT
Pure trend following captures rare outliers.
Jerry says applying trend following to individual stocks rather than only indices matters because an index averages and mutes big trends. Individual stocks can produce outlier moves, and with thousands of stocks you can build a more diverse trend portfolio. He argues no CTA would limit itself to only the dollar index or Goldman Sachs commodity index, so limiting stocks to indices makes little sense.
MFUT LONG
HIGH
14:00
Aug 21
Aug 21
Meb Faber Show
14d
SPY 1ST
Value stocks
Tax-managed strategies
AVUV
AI companies
▾
HIGH
Own cheap broad market index funds.
Since Dimensional started about 45 years ago, one dollar put in the S&P 500 became worth over $100, while gold went from about $800 to roughly $4,400, only a fivefold gain. Long-term equity compounding massively beat gold, so gold-focused investors missed the bigger market return.
SPY LONG
GLD AVOID
Value is separate source of returns.
Fama-French research identified value versus growth as a separate dimension of returns, alongside market and size. That insight led Dimensional to create value strategies because value is a distinct source of expected return.
Value stocks LONG
Tax-managed strategies improve after-tax returns.
The next generation of investment improvement is coming from tax-managed strategies that improve after-tax returns without trying to outguess the market. Booth sees these as emerging, differentiated, and exciting.
Tax-managed strategies LONG
Small-cap value enters best seasonal window.
Using Fama-French data over the last 100 years, the next 12 months are historically the best seasonal window for small-cap value, with January 2027 the single best month. Meb says he would not use it as an explicit forecast, but it is a clear historical setup to monitor.
AVUV WATCH
AI winners unknown; buy all companies.
AI will be a big deal, but that does not identify which AI companies will win or lose. Like the California gold rush, the obvious winners are hard to predict, so investors should own a broad diversified basket rather than try to pick individual AI winners.
AI companies LONG
Small caps offer higher expected returns.
Small-cap stocks are a distinct asset class. They are riskier than large-cap stocks, and because risk and return are related, they have higher expected returns. Dimensional's first nine years were poor, but that was a period of extreme small-cap underperformance, not a broken thesis.
IWM LONG
HIGH
14:45
Aug 19
Aug 19
Meb Faber Show
16d
EEM
Value stocks
GEX 1ST
Small cap value
SPY
▾
HIGH
Foreign and small cap value are rebounding.
Foreign stocks, emerging market stocks, value, and small caps are much cheaper than the US market and are starting to rebound, offering explosive returns after years of underperformance.
EEM LONG
Value stocks LONG
IWM LONG
VXUS LONG
GEX avoids expensive market cap weighted concentrations.
The Cambria Global EW 3 ETF (GEX) breaks the market cap link, avoiding concentration in the most expensive top positions by offering a more balanced portfolio of global large-cap companies for a low 25 basis point fee.
GEX LONG
Small caps enter their strongest seasonal period.
Small caps and small cap value are entering their best 12-month and 6-month periods of the presidential cycle, with January historically being the biggest month of returns.
Small cap value LONG
High CAPE ratios signal poor future returns.
The US stock market is entering bubble territory with the Schiller CAPE ratio approaching 45; historically, markets closing a year at a CAPE of 40 have never produced above-average 10-year real returns.
SPY AVOID
QQQ AVOID
MAGS AVOID
Shareholder yield outperforms traditional dividend growth strategies.
Shareholder yield strategies historically outperform high dividend yield and dividend growth strategies because they incorporate buybacks and avoid companies that dilute shareholders through share issuance.
SYLD LONG
FYLD LONG
EYLD LONG
Global REITs provide essential real asset diversification.
Global REITs are putting up great returns and serve as a necessary real asset component that is typically missing from traditional US-only allocations.
BLDG LONG
GVAL targets the cheapest global equity markets.
The Cambria Global Value ETF (GVAL) breaks the market cap link by top-down selecting the cheapest third of global countries based on valuation metrics (CAPE, cash flow, dividends, book) and buying the top stocks in those markets.
GVAL LONG
VAMO provides hedged equity exposure for protection.
The Cambria Value and Momentum ETF (VAMO) serves as a satellite fund for nervous investors who want equity exposure but want to be hedged; it can hedge up to 100% of the portfolio with futures based on market valuation.
VAMO LONG
TAIL hedges against US stock market downturns.
The Cambria Tail Risk ETF (TAIL) offers a thoughtful approach to tail risk hedging by sitting in 10-year bonds and buying laddered puts on the stock market, serving as a good solution if US stocks perform poorly.
TAIL WATCH
TRTY combines buy-and-hold with trend following.
The Cambria Trinity ETF (TRTY) forms an ideal all-in core allocation by combining half buy-and-hold global asset allocation with half trend following.
TRTY LONG
TYLD tactically targets fixed income yield spreads.
The Cambria Tactical Yield ETF (TYLD) provides a strategic value approach to fixed income by only moving into the risky sleeves of the bond market when there is enough yield spread, avoiding broad fixed income that lacks sufficient yield.
TYLD LONG
Avoiding dividends maximizes after-tax compounding returns.
For taxable investors focused on compounding, targeting stocks with low to no dividend yield via the TAX ETF is vastly more tax-efficient than high dividend strategies that force investors to pay taxes on reinvested dividends.
TAX LONG
HIGH
16:00
Aug 14
Aug 14
Meb Faber Show
21d
TLT
BTC
EPOL 1ST
EWJ 1ST
EWG 1ST
▾
HIGH
Avoid long-term US Treasury bonds.
Long-term US sovereign bonds are certificates of confiscation. With 120% debt-to-GDP, large deficits, entitlements, veterans benefits, and fiscal dominance, the US cannot afford 10-year yields much above 4.7%, so real rates must go deeply negative. Historical examples include 1901-1981 negative real bond returns and post-WWII real rates bottoming at -13%.
TLT AVOID
Bitcoin benefits from debasement trade.
Hamiltonian economics, debt-driven liquidity injections, and secular negative real rates create a persistent debasement regime; Luke explicitly says that regime is great for Bitcoin and that gold and Bitcoin are going to soar.
BTC LONG
Favor Japan and European manufacturing economies.
US equities are a crowded ~70% of global market cap, so excess returns require non-US exposure. Since America cannot reshore without help from Japan, Germany, and other manufacturing economies, he suggests moving US equity weight toward 50%, adding Japan around 15%, and sprinkling Germany, Poland, Hungary, and emerging markets, expecting at least inline returns with lower volatility.
EPOL LONG
EWJ LONG
EWG LONG
BUX LONG
EEM LONG
Own grid infrastructure and industrial suppliers.
US electricity generation was flat from 2004 to 2023 while nominal GDP soared, reflecting financialization and offshoring. Reshoring, AI, and grid buildout are reversing that stagnation for the next 5-15 years. Luke recommends GRID and PAVE ETFs and says industrial companies like Eaton, Parker Hannifin, Danaher, and Illinois Tool Works sit in the middle of this trend with demand and pricing power.
ETN LONG
Parker Hannifin LONG
DHR LONG
ITW LONG
PAVE LONG
GRID LONG
Own industrial metals for grid buildout.
Grid buildout and reshoring require aluminum, stainless steel, copper, and silver. Luke says copper sits at the intersection of inflation, infrastructure, and an underowned market, and that commodities and industrials are back after the anti-Hamiltonian regime.
Aluminum LONG
SILVER LONG
COPPER LONG
STAINLESS-STEEL LONG
Avoid overvalued US AI sector.
AI will be revolutionary, but many public and private AI companies are priced at extreme revenue multiples with no room for issues. AI companies are borrowing heavily, competing with the Treasury for capital and prospectively eroding the tax base. Meanwhile, Chinese AI is becoming much cheaper and good enough; serious Chinese competition is fatal to 1,000x, 100x, 10x, and probably even 5x sales valuations, compressing them sharply.
US AI sector AVOID
Hold T-bills for optionality.
Luke keeps close to 20% of liquid net worth in T-bills as optionality because he has high conviction in the destination but low conviction in the path. Cash yield also helps finance the gold position and provides dry powder for opportunities, consistent with the Fugger-style 25% cash allocation.
US Treasury Bills LONG
US stocks soar in dollar terms.
As real rates are forced lower and liquidity is injected, US stocks should have a great 5-10 years in dollar terms, especially capital-intensive business models; however, in real or gold terms stocks have been losing and likely keep losing purchasing power.
SPY LONG
Own physical gold as duration replacement.
Gold is money for 5,000 years, tends to return 1-2% above actual inflation, and in a multipolar world central buyers like China support it. Under Hamiltonian economics and fiscal dominance, real rates must fall and the debasement trade must run; investors should replace long duration with physical gold, starting at 5-10% minimum and he personally holds over 25%.
GLD LONG
HIGH
14:00
Jul 31
Jul 31
Meb Faber Show
1mo
SPY 1ST
▾
HIGH
US stocks at record valuation extreme.
The US stock market is now $80 trillion, over 250% of GDP, a level never seen before. Record broad equity ownership via 401(k)s, a taste for speculation, and recent speculative bubbles in meme stocks, crypto, and gold make this an extremely risky environment.
SPY AVOID
HIGH
14:00
Jul 24
Jul 24
Meb Faber Show
1mo
IEF 1ST
OIH 1ST
ITB 1ST
BLDR 1ST
▾
HIGH
Expect 10-year Treasury yields to rise substantially.
Inflation is the normal course of economic events and is likely to be 4-5%, making a 2% target a pipe dream. A 10-year Treasury yield of 5-6% or even 7% is a credible possibility in the coming decade, which would significantly reduce the present value of future cash flows. This risk is not priced in, making long-term bonds unattractive.
IEF AVOID
Offshore oil services supply tightens cyclically.
The offshore oil services industry has fundamentally changed supply-demand dynamics, with limited capacity after years of underinvestment since 2015. Geopolitical events like the Middle East conflict have accelerated energy security concerns, driving countries to develop domestic resources. Valuations remain modest, making the sector extremely compelling almost regardless of oil prices.
OIH LONG
Homebuilders oversold, cyclical recovery ahead.
Homebuilding stocks have pulled back dramatically, and the market is pricing in extremely poor results. The downturn is cyclical, and the industry has right-sized to a level of activity that is not sustainable. Valuations are substantially discounted, and increasing activity is likely over the next few years, though timing is uncertain.
ITB LONG
BLDR cheap, normalized earnings far above price.
Builders FirstSource is a company they know well, now down over 50% from its high near $230 to around $75. The business has earnings potential of $15-20 per share in a normalized environment. They view this as a great entry point again and are building a position, expecting strong returns over the next 3-5 years as the cyclical recovery unfolds.
BLDR LONG
HIGH
14:00
Jul 20
Jul 20
Meb Faber Show
1mo
SPY FLIP
Equal-weight US equities
Foreign developed equities
EEM 1ST
US small-cap value equities
▾
HIGH
Avoid US large-cap, extremely overvalued.
US large-cap stocks are extremely overvalued, with a CAPE ratio of 42 and dividend yield of 1%. Historically, no market ending a year at a CAPE of 40 has delivered above-average returns over the next decade. He expects poor returns (low single digits) over the next 5-7 years, making US large-cap market-cap-weight stocks unattractive.
SPY AVOID
Equal-weight will stomp cap-weight.
Equal-weighted US equities will significantly outperform cap-weighted indices over the next decade because cap-weighting's Achilles heel is valuation, and current extreme valuations make an equal-weight approach superior.
Equal-weight US equities LONG
Foreign developed stocks cheap, poised to rise.
Foreign developed equities are cheap, trading at low-teen valuations relative to the expensive US market. They are under-owned, performance is strong and accelerating, and FOMO is starting to build. Investors should allocate significantly to this asset class.
Foreign developed equities LONG
Emerging markets undervalued, major upside ahead.
Emerging market equities are deeply undervalued, massively under-owned by US investors despite representing over half of world GDP, and have been performing exceptionally. A FOMO-driven reallocation could push them much higher.
EEM LONG
Rotate into US small-cap value.
US small-cap value stocks are having an excellent year as value rotates within the US, and breaking the market-cap tilt by moving down in size and toward value offers attractive opportunities with low valuations (P/E of 10).
US small-cap value equities LONG
Allocate heavily to trend following strategies.
Trend following and momentum strategies are an essential diversifier that should constitute up to 50% of a portfolio. They provide protection during downturns (e.g., 2022) by shorting bonds and other assets when equities fall, and are severely under-allocated by investors.
GMO LONG
Avoid bonds, own T-bills for yield.
The entire fixed-income curve offers inadequate compensation for duration and credit risk relative to risk-free T-bills. Credit spreads are in the top decile historically and are vulnerable to blowing out. Investors should avoid aggregate bonds, corporates, and high yield, and own T-bills instead.
AGG AVOID
BIL LONG
LQD AVOID
HYG AVOID
Use shareholder yield strategy to avoid value traps.
A quantitative shareholder yield strategy—buying companies with high combined buybacks, dividends, and debt reduction, and sorting by momentum to avoid value traps—historically adds about 1% per year and has delivered exceptional results across US, foreign developed, and emerging markets.
EYLD LONG
SYLD LONG
FYLD LONG
Use VAMO for hedged value exposure.
VAMO is an ETF that buys US value stocks and dynamically hedges market exposure (0-100%) based on valuation and trend, making it ideal for investors nervous about an expensive S&P 500 while still participating in upside.
VAMO LONG
Global REITs surging, under-owned real asset.
Global REITs are having a surprisingly phenomenal year, up 12% with a value tilt, and represent an under-owned real asset class that investors should include in portfolios.
BLG LONG
Gold improves risk-adjusted portfolio returns.
Gold plays a strategic and tactical role in portfolios by improving risk-return characteristics over time and is hard to argue against as a long-term holding.
GLD LONG
HIGH
14:00
Jul 17
Jul 17
Meb Faber Show
1mo
SPY
QQQ
HYG
FXI 1ST
LQD
▾
HIGH
AI job losses unwind S&P and Nasdaq
AI will displace ~15% of knowledge workers within 3 years, killing 401(k) flows that have powered the largest stocks. People will sell taxable assets and redeem retirement accounts, causing the S&P 500 and Nasdaq 100 to unwind hard. He expresses this via put spreads for capped risk.
SPY SHORT
QQQ SHORT
AI credit stress hits high yield bonds
Second-order AI disruption effect: high-yield credit spreads will blow out. He uses put spreads on HYG to express this view.
HYG SHORT
China equities uninvestable due to policy risk
China is uninvestable because the quality and quantity of information is awful (Ministry of State Security removes truth-tellers), policy is capricious, and the VIE structure means shareholders legally own nothing. The risk does not justify the reward.
FXI AVOID
AI causes credit spread blowout hit LQD
Second-order AI disruption effect: credit spreads will blow out due to aggregate demand issues. He uses put spreads on investment-grade bond ETF LQD to benefit from a sell-off.
LQD SHORT
Junior miners benefit from talent under-allocation
There has been a huge under-allocation of talent to the mining space since at least 2000, creating an edge. Junior miners can offer venture-type returns with more data to base decisions on. The firm is invested mostly on the long side, agnostic on metals.
GDXJ LONG
Momentum strategy within S&P 500 works
A systematic momentum strategy within the S&P 500 has compounded at over 70% gross since October 2024. The firm sees edge in momentum as a pragmatic way to invest, counterbalancing the natural skepticism of short sellers.
MTUM LONG
Muni bonds distressed by AI job losses
Third-order AI disruption effect: state and local government finances (especially large issuers like California, New York) will strain, causing municipal bond ETFs to freeze and face dislocation. He plans to short MUB via put spreads and cover during the dislocation.
MUB SHORT
SoFi's aggressive accounting masks fictitious gains
SoFi uses aggressive fair value option accounting, marking personal loans up to 108–109 on day one and financing purchasers to support those marks. A $312 million transaction with a subsidiary appears misleading and, if disallowed, could force a restatement of about $1 billion of previously reported EBITDA. Management has extracted over $50 million via forward agreements.
SOFI SHORT
HIGH
14:00
Jul 10
Jul 10
Meb Faber Show
1mo
BTC 1ST
SPY 1ST
▾
HIGH
Bitcoin is obsolete, avoid it.
Bitcoin is a pioneering technology that will be superseded by dollar-backed stablecoins, much like zeppelins were overtaken by airplanes; its value is likely to decline as adoption stagnates, and the recent breach of the $60,000 floor signals weakness.
BTC AVOID
Don't try to beat; buy index.
Trying to beat the market consumes enormous time and yields negligible extra returns for typical investors; therefore, buying a broad low-cost index fund allows one to capture market returns while using time more productively.
SPY LONG
HIGH
14:00
Jul 03
Jul 03
Meb Faber Show
2mo
IEF 1ST
SPY
PUI 1ST
▾
HIGH
US fiscal risks make Treasuries unattractive
The US fiscal situation, with national debt at 120% of GDP and interest payments now exceeding defense spending, raises the risk of reduced demand for Treasuries. This could lead to structurally higher interest rates and lower bond prices, making US government bonds unattractive.
IEF AVOID
US equity valuations extremely stretched vs GDP
US equity market capitalization relative to GDP is at extreme all-time highs, nearly triple historical levels, creating a risk that either earnings must surge to justify valuations or prices may correct, making current levels unsustainable.
SPY WATCH
US energy demand surge boosts infrastructure
US energy demand is forecast to grow by 60% through 2040 after decades of flat growth, necessitating massive investment in energy generation and transmission infrastructure, a clear tailwind for the sector.
PUI LONG
HIGH
14:00
Jun 26
Jun 26
Meb Faber Show
2mo
ACWI 1ST
SPY
▾
HIGH
Diversify with global stock index.
Global diversification protects against country-specific disasters; even with Japan's epic bubble and 35-year recovery, an investor in the MSCI ACWI still earned around 8% annually, demonstrating the power of owning a global index.
ACWI LONG
Buy and hold US stocks long-term.
Investing in US stocks even at all-time highs and holding for the long term has historically made investors millionaires; the stock market's win rate improves with holding period, making it a favorable long-term bet even for the world's worst market timer who only bought before the biggest crashes.
SPY LONG
HIGH
14:00
Jun 23
Jun 23
Meb Faber Show
2mo
SPY FLIP
▾
HIGH
US stocks historically compound through all crises.
Despite wars, pandemics, depressions, and market crashes, US stocks have delivered extraordinary long-term compounding since 1800, turning $1 into over $200 million nominal. Even if bought at peak valuations like 1999, investors have done fine over subsequent decades. Over 20‑year horizons, stocks become less volatile than bonds and have consistently positive returns, so staying fully invested in US equities for the long run overcomes any near‑term turmoil or high valuations.
SPY LONG
HIGH
14:00
Jun 19
Jun 19
Meb Faber Show
2mo
SPY 1ST
▾
MED
US stock market cap over debt is bullish.
The United States consistently regains global market leadership by capturing new technology waves. The AI revolution is centered in the US, not in Europe or other countries, and this innovation edge should continue to drive US equity outperformance over international markets, just as it did over the past 15 years versus emerging markets.
SPY LONG
MED
14:00
Jun 12
Jun 12
Meb Faber Show
2mo
WTI 1ST
SMH
EUFN 1ST
GLD 1ST
▾
HIGH
Oil supply-demand supports higher prices.
The supply-demand balance for hydrocarbons favors the long side regardless of near-term geopolitical developments in Iran.
WTI LONG
AI bubble dwarfs dot-com era.
The excitement around AI dwarfs the internet boom, drawing massive capital similar to the railroads, with overbuilding, double-ordering, and unknown true demand. The Fed's intrusive role amplifies risks. This is one of the greatest bubbles of all time.
SMH WATCH
European banks are deeply undervalued.
Some obscure European banks trade at exceptionally low multiples of book value and earnings, offering value despite an expensive overall market.
EUFN LONG
Gold hedges dollar decline long-term.
Gold is a conceptual investment in the managed decline of the US dollar. Central banks, especially in Asia, are large buyers. Despite volatility and long dormant periods, gold has outperformed stocks over selected intervals and hedges monetary deterioration.
GLD LONG
HIGH
14:00
Jun 05
Jun 05
Meb Faber Show
3mo
BRK.B 1ST
▾
HIGH
Buy and hold Berkshire Hathaway.
Charles Ellis bought Berkshire Hathaway at $700 per share in the early 1970s after being convinced by Sandy Gottesman of its long-term potential. He believes the company, under Warren Buffett and Charlie Munger, embodies disciplined long-term compounding, diversified operations, and a superb management culture, and he has held the stock forever, seeing it multiply nearly a hundred times in 50 years.
BRK.B LONG
HIGH
14:00
May 29
May 29
14:00
May 15
May 15
Meb Faber Show
3mo
BTC
IGV
ETH
ECH 1ST
GRNY 1ST
▾
HIGH
Bitcoin and Ethereum are base layer winners.
Bitcoin and Ethereum are the base layer winners in blockchain: Bitcoin is best for storing value, Ethereum serves as the compute layer. Both are foundational to the crypto ecosystem and benefit from institutional adoption and tokenization trends.
BTC LONG
ETH LONG
Software stocks offer positive reward now.
Software stocks are attractive because bad news is already priced in; the sector's relative price is back to 15-year lows, and the 'software eating the world' thesis has been unwound over the past six months, creating a positive reward opportunity.
IGV LONG
Echoar is a pure play on SpaceX.
Echoar (ECHO) is a pure play on SpaceX because it sold its spectrum to SpaceX in exchange for stock, and it trades near NAV, making it a better way to gain SpaceX exposure than closed-end funds that trade at a premium.
ECH LONG
Granny Shots ETF outperforms via multi-theme stocks.
The Granny Shots ETF (GRNY) holds stocks tied to multiple structural themes (labor shortage, AI, energy, cyber, millennials, manufacturing cycle, monetary policy) and has outperformed the S&P 500 in both growth and regime-change environments; it is a basket of the 'Mag 35' high-conviction names.
GRNY LONG
HIGH
14:00
May 01
May 01
Meb Faber Show
4mo
Mexico government bonds
UK 10-year government bonds
BIZD
Japanese 30-year government bonds (USD hedged)
Australian 10-year government bonds
▾
HIGH
EM bonds offer high real yields
Emerging market bonds (Peru, Mexico, South Africa, Brazil) offer high real yields (3%+ real) due to disciplined policymaking and lower inflation than developed markets. These provide attractive income and diversification.
Mexico government bonds LONG
South Africa government bonds LONG
Brazil government bonds LONG
Peru government bonds LONG
UK 10-year bonds at 4.75%
UK 10-year government bonds at 4.75% offer similar appeal to Australian bonds, with high credit quality and attractive real yields in a global fixed income context.
UK 10-year government bonds LONG
Avoid private credit and BDCs
Private credit and direct lending markets show deterioration similar to subprime mortgage buildup pre-2008. Too much money chasing too few good ideas, underwriting weakness, and lack of transparency make the sector risky. BDCs trade at large discounts to NAV, signaling overvaluation.
BIZD AVOID
BIZD AVOID
Japanese 30-year JGB hedged 6.5%
Japanese 30-year government bonds hedged back to dollars yield 6.5%, offering an interesting global diversification opportunity with a high yield after hedging cost.
Japanese 30-year government bonds (USD hedged) LONG
Australian 10-year bonds at 5%
Australian 10-year government bonds yielding 5% provide a high-quality, global diversification opportunity with a meaningful yield pickup versus US Treasuries.
Australian 10-year government bonds LONG
US 10-year Treasuries attractive at 4.4%
US 10-year Treasuries at 4.4% offer a compelling yield in a high-quality, intermediate duration fixed income portfolio. With inflation moderating, real yields are attractive and provide a strong source of income and total return.
IEF LONG
10-year TIPS at 2% real yield
10-year TIPS paying a 2% real yield provide a straightforward inflation hedge and attractive real income, especially given potential supply chain disruptions and geopolitical risks.
TIP LONG
Long broad-based commodities
A broad-based, actively managed commodity portfolio can hedge geopolitical and supply chain risks, provide diversification, and capture elevated risk premiums in commodity spreads. Investors are underweight commodities.
PDBC LONG
HIGH
14:01
Apr 10
Apr 10
Meb Faber Show
4mo
XLF
SHOP 1ST
XLV
▾
Paul listed fintech as a key area, noting it relies on "proprietary data sets," "regulatory constraints," and "transactional behavior over time." These factors (data, regulation, embedded workflows) act as defensive barriers, making it challenging for generic AI solutions to quickly replicate and disrupt established companies or viable startups. WATCH for opportunities, as the sector's inherent moats can protect companies that effectively integrate AI into their defensible offerings. Aggressive new regulations or the emergence of AI agents that can bypass traditional financial intermediaries could undermine these defensive characteristics.
XLF WATCH
Long-term.
Alex stated, "I don't think anyone in e-commerce is going to be ripping out Shopify to save a few dollars," identifying it as a mission-critical system a business runs on. AI disruption primarily threatens non-essential software. Mission-critical applications that touch core operations, money, or regulation have high reliability requirements and switching costs, making them resilient to replacement. LONG because its position as essential infrastructure makes it defensible against AI-driven cost-cutting or displacement in the near to medium term. A fundamental AI breakthrough that allows for easy, reliable, and secure replication of its core e-commerce platform functionality could erode this moat.
SHOP LONG
Medium-term to long-term.
Paul explicitly cited healthcare as an area of investment focus due to its "high regulatory barriers, data defensibility, [and] integration into complex legacy workflows." These characteristics create significant moats that protect companies from being quickly disintermediated by AI. Regulatory compliance and proprietary data are hard for fast followers to replicate. WATCH for investment opportunities, as the sector offers defensible niches where AI can augment rather than replace existing businesses. Changes in healthcare regulation or data privacy laws could lower these barriers. Additionally, AI-native competitors might find ways to navigate the regulatory landscape faster than anticipated.
XLV WATCH
Long-term.
14:00
Apr 03
Apr 03
Meb Faber Show
5mo
PSP 1ST
XLV 1ST
▾
The speaker directly criticizes private equity's "volatility smoothing," calling it "lying" or "making up numbers," where reported prices are not tradable, especially during crises (e.g., Q1 2020). This accounting practice creates a misleading profile of high returns with low, smoothed volatility, which does not reflect true economic risk or liquidity constraints for investors. The traditional, illiquid private equity structure is unattractive because it obscures true risk and denies investors liquidity, especially compared to liquid public market alternatives that can replicate its factor exposures. If private equity funds can consistently generate alpha beyond replicable factor tilts and justify their illiquidity premium, the avoidance could be costly.
PSP AVOID
Long-term
The speaker states that if AI leads to a future of material abundance where people work less, "there is an infinite demand for health and beauty," and concludes, "those seem like good areas to bet on." In a world of solved material production, human wants will shift towards non-material, experiential, and self-improvement domains, with health and beauty services being primary beneficiaries. The health and beauty sector is positioned to capture disproportionate demand growth in a post-scarcity economy driven by AI and automation, making it a compelling long-term investment. Technological change could radically alter conceptions of "beauty" or health delivery, disrupting incumbent business models. The thematic timeframe is also very long.
XLV LONG
Long-term
14:01
Mar 27
Mar 27
Meb Faber Show
5mo
PPLT 1ST
▾
Speaker states he has been telling clients to buy platinum for a couple of years because it is "too cheap." Notes it used to take 2.4 oz of gold to buy 1 oz of platinum, and now the ratio is inverted (approx. 2.4 oz of platinum to buy 1 oz of gold). He states it is "80 times rarer than gold" and mined primarily in South Africa and Russia. The extreme price dislocation relative to gold and its fundamental rarity creates a asymmetric value opportunity. Its industrial uses and constrained supply base support its strategic value. LONG. It is presented as a "very safe bet" and a "really good performer" within the metals complex, positioned for mean reversion against gold. Platinum prices could still decline in a broad market downturn, as with all commodities. Production could increase, or demand from automotive (catalytic converter) use could wane.
PPLT LONG
Long-term
17:11
Mar 24
Mar 24
Meb Faber Show
5mo
DBMF
VEA 1ST
▾
Speaker explicitly recommends a 10-20% allocation to trend-following strategies for most advisors, stating it is "about as close as you can get" to a magic free diversifier and is the "premier diversifier" to a buy-and-hold portfolio. Trend-following provides an asset-class and approach-agnostic source of returns that is historically uncorrelated to traditional equities, improving portfolio resilience. LONG because it is viewed as a high-conviction method to address a common portfolio construction mistake and improve risk-adjusted returns over the long term. Extended periods of underperformance (e.g., during strong, steady bull markets) and implementation costs.
DBMF LONG
long-term
Speaker states foreign and emerging markets had a "monster year" (e.g., +30%), and you could see an "extended move in foreign equities over the next few years." This is due to a combination of relative undervaluation, recent outperformance, positive momentum, and most investors being structurally under-allocated to non-US markets after a long cycle of US dominance. LONG because the shift away from US concentration and toward global diversification is believed to be in its early stages and could persist for years. A resurgence of US market strength and dollar momentum could halt or reverse the relative outperformance.
VEA LONG
medium-term to long-term
14:01
Mar 20
Mar 20
Meb Faber Show
5mo
XLE 1ST
GOLD 1ST
XLY
XLB 1ST
▾
Speaker explicitly states "you want to kind of fade energy a little bit" after its recent rally and prefers materials/metals. The energy rally is driven by a transient geopolitical shock; the trade is crowded and the logistical oil crisis is expected to be resolved under economic pressure. Avoid energy as a tactical call to reduce exposure after a sharp run-up driven by event risk. The Iran conflict escalates permanently, sustaining oil prices at recession-inducing levels ($150+).
XLE AVOID
Short-to-medium-term.
Speaker advocates for a portfolio shift from traditional 60/40 to a 60/20/20 model, with the 20% alternatives allocation including gold as a defensive asset. In a fiscal-dominant, inflationary regime, gold protects against currency debasement and serves as a hedge when the defensive function of long-duration bonds is compromised. Long gold as a strategic, non-yielding asset for portfolio diversification and inflation hedging. A return to a Volcker-like Fed prioritizing inflation fighting above all else, driving real rates sharply higher.
GOLD LONG
Long-term.
Speaker highlights consumer discretionary as a sector coming out of a recession, benefiting from policy changes, deregulation, and pent-up demand. The sector is a direct beneficiary of the rolling recovery, wage growth for lower/middle-income workers, and potential Fed rate cuts. Long consumer discretionary to capitalize on the cyclical recovery in consumer spending and earnings revisions. A sharp, sustained spike in oil prices crushing discretionary consumer budgets.
XLY LONG
Medium-term.
Speaker states he was "much more bullish on the metals and some of the materials than we were on energy" and currently thinks "the better trade now" is to fade energy and go back to materials/metals. Metals and materials are leveraged to global industrial recovery and infrastructure capex (e.g., Big Beautiful Bill), without the geopolitical supply shock dynamics currently plaguing oil. Long non-energy minerals (metals, materials) as a preferred cyclical exposure within commodities. A global recession halting the industrial recovery and commodity demand.
XLB LONG
Medium-term.
14:00
Mar 13
Mar 13
Meb Faber Show
5mo
NVDA
QQQ
IWM 1ST
▾
I got a bunch of Mac 7 and you know what? I can't take it anymore. I see some of these starting to underperform and now I realize they don't always outperform forever and I need to diversify. Wealthy investors and advisors are sitting on massive, highly concentrated gains in mega-cap tech. As momentum slows, there is a structural and urgent push to use complex tax vehicles (like Section 351 ETF seeding and 721 exchange funds) to offload this concentration risk. This creates a hidden, structural supply overhang for the market's biggest historical winners as early holders look for the exit. WATCH. The smart money is actively paying legal and structuring fees to figure out how to exit their massive mega-cap tech winners without paying taxes, signaling a desire to rotate away from top-heavy concentration. Mega-cap tech companies continue to post massive earnings beats, punishing those who diversify too early and forcing capital to remain in the market-cap weighted leaders.
NVDA WATCH
QQQ WATCH
medium-term
The biggest Achilles heel of market cap weighting is people are kind of stuck in these positions and they get bigger and bigger. Theoretically, if you could sell out of them, recycle into for example small caps, smaller companies, that theoretically makes the ecosystem a little bit stronger. The current tax code creates a dead weight loss that traps capital in massive, appreciated mega-cap stocks because investors refuse to pay the capital gains tax to sell. As the financial industry scales tax-efficient diversification tools, this trapped capital will finally be unlocked and recycled down the market cap spectrum into under-owned, smaller companies. LONG. The proliferation of tax-efficient exchange funds and ETF conversions will systematically funnel capital out of the top-heavy indices and into broader, smaller-capitalization equities. The IRS cracks down heavily on Section 351 and 721 exchanges, keeping capital permanently trapped in mega-cap tech stocks due to the friction of capital gains taxes, or small caps continue to suffer from higher relative interest rates.
IWM LONG
long-term
15:01
Mar 06
Mar 06
Meb Faber Show
6mo
IGV
BX 1ST
EQIX 1ST
DLR 1ST
DXYZ
▾
"Concerns around how AI is going to potentially, you know, disintermediate and disrupt, you know, traditional software investing that was happening in the private markets." The traditional Private Equity playbook (buy a B2B SaaS company, optimize margins, sell) is under threat. AI agents may replace seat-based software licenses. This creates a headwind for legacy Software/SaaS baskets. Watch/Neutral on broad software indices; be selective against companies easily disrupted by AI automation. AI adoption might be slower than expected, allowing legacy software companies to pivot and integrate AI successfully.
IGV WATCH
Long-term
"Private equity firms are stuck with assets that are now going on kind of seven years... Secondary funds have the ability to step in and really capitalize on this current dynamic." The "Liquidity Crunch" in private equity forces GPs and LPs to sell stakes at discounts. The largest players in the Secondaries market (Blackstone's Strategic Partners, Carlyle's AlpInvest, Ares' Landmark, KKR) are the buyers of choice. They get assets at a discount and are the solution to the industry's liquidity problem. Long the alternative asset managers with dominant Secondary platforms. A severe recession could mark down the underlying portfolio values (NAV) of the assets they are buying, regardless of the entry discount.
BX LONG
KKR LONG
ARES LONG
CG LONG
Medium-term
"A lot of the infrastructure needs are currently being driven by some of our technology innovations... whether it's more power that we need for data centers, right, data center construction." "Infrastructure" is now a derivative trade on AI. To support LLMs, you need physical Data Centers (EQIX, DLR) and massive amounts of electricity/power generation (VST, CEG). These "Real Assets" have inflation-linked contracts and secular demand growth. Long Data Center REITs and Power Producers/Utilities. Regulatory pushback on power consumption or a slowdown in AI capex spending.
EQIX LONG
DLR LONG
CEG LONG
VST LONG
Long-term
"You got funds like DXYZ... It'll be curious to see how these in my mind this mismatch of liquid illquid gets handled... Do you think the Robin Hood fund is going to hit a 25% premium or discount first? I imagine it'll do both." Closed-end funds holding private assets (like SpaceX or OpenAI) often trade at massive dislocations to their Net Asset Value (NAV). Meb highlights the extreme volatility and "strangeness" of these vehicles. Watch for extreme dislocations (deep discounts to buy, massive premiums to sell/short), but avoid as a passive hold due to premium risk. Buying at a 100%+ premium (as seen historically) guarantees underperformance relative to the underlying assets.
DXYZ WATCH
Short-term (Tactical)
16:12
Mar 03
Mar 03
Meb Faber Show
6mo
MDYV 1ST
IVOV 1ST
SPY
VOO
IVV
▾
"For the category, which is Morningstar Midcap Value, [the P/E was] 17.86." While the speaker is pitching a specific active fund (SYLD), he explicitly benchmarks it against the Midcap Value category. He notes this entire category is trading at a massive discount to the S&P 500 (17.86x vs 27.61x). Investors who prefer passive exposure over active management can still capture this thematic "value spread" by buying the index tracking the Midcap Value sector. Long Midcap Value as a sector rotation play away from expensive large caps. Economic recession could hurt mid-cap companies more than diversified large caps.
MDYV LONG
IVOV LONG
IJJ LONG
medium-term
"S&P [P/E was] a whopping 27.61... Valuation metrics offer little insight into potential short-term market movements, they have historically exhibited explanatory power over extended horizons." The speaker uses the S&P 500's high valuation as a cautionary benchmark. A P/E of 27.6x implies future returns are "constrained by starting prices." The logic suggests that capital should be reallocated from the expensive broad index into cheaper pockets of the market (Value/Shareholder Yield). Avoid or underweight broad large-cap indices due to compressed equity risk premiums and high multiples. Momentum in large-cap growth/tech could continue to defy valuation gravity in the short term (irrational exuberance).
SPY AVOID
VOO AVOID
IVV AVOID
long-term
"SYLD... has struggled recently, placing it in the bottom 11% versus its category in 2025... P/E for SYLD was 12.52... S&P a whopping 27.61." The fund has underperformed for two consecutive years (2024-2025), creating negative sentiment and outflows. However, the underlying holdings are trading at less than half the valuation of the broad market (12.5x vs 27.6x). Historically, buying quality strategies during periods of peak pessimism and low valuation leads to significant mean reversion and outperformance. Long positions are warranted to capture the valuation gap as the "rough patch" normalizes. The "value trap" dynamic could persist longer than expected; the strategy is actively managed and may deviate significantly from benchmarks.
SYLD LONG
long-term
15:01
Feb 27
Feb 27
Meb Faber Show
6mo
MANU 1ST
GBDC 1ST
NVDA 1ST
ORCL 1ST
BXSL 1ST
▾
"They become trophies for billionaires... As long as the number of billionaires exceeds the number of professional sports franchises, there's no correction coming." Valuation metrics (P/E, Cash Flow) are irrelevant for sports teams. They trade on scarcity value (Ego/Status). Publicly traded sports holding companies trade at discounts to private market "trophy" values. Long sports assets as they are immune to traditional valuation corrections. A global recession that significantly reduces the billionaire population.
MANU LONG
MSGS LONG
Long-term
"My concern is the other companies that are investing in this AI architecture... borrowing through private credit... when that correction hits it's not just the companies that are going to go under it's the lenders." While Big Tech uses cash for AI capex, smaller players are using high-interest private debt. If the AI ROI isn't immediate, defaults will spike. The risk sits with the lenders (BDCs and Private Credit funds). Avoid exposure to private credit vehicles that have funded the speculative AI build-out. AI generates immediate cash flow for borrowers, preventing defaults.
GBDC AVOID
BXSL AVOID
ARCC AVOID
Short-term
"In 2025 I unwound the rest of my Nvidia... the bulk of the AI architecture wave Nvidia's already ridden... I'm not [sure] that there's that much extra growth left to justify the pricing there." The market is extrapolating the initial AI infrastructure build-out indefinitely. As the build-out phase matures, growth rates will normalize, causing multiple compression. He has fully exited the position. A "second wave" of AI hardware demand larger than the first.
NVDA AVOID
Medium-term
"Software had the highest margins... AI is actually taking much of what used to take them people and resources to do and doing it almost effortlessly... They have too much to lose... [It's] the innovator's dilemma." Legacy SaaS companies (Salesforce, Oracle) rely on high-margin, sticky seats. AI allows cheaper, automated alternatives. These incumbents cannot pivot to cheap AI solutions without destroying their own lucrative business models. Avoid legacy software firms that are "in denial" or unable to cannibalize their own high margins. Successful pivot to AI-agent based pricing models.
ORCL AVOID
CRM AVOID
Medium-term
"I shed my Tesla fairly early in the year [2025]... Tesla became a political investment... when people think about whether they buy your car based on what their political standing is, you're in trouble as a business." The brand has become polarized. A consumer goods company cannot sustain growth if 50% of the addressable market alienates the product due to the CEO's political affiliation. Damodaran sold his position; the stock is now driven by political sentiment rather than fundamentals. Tesla succeeds in robotics/AI (Optimus) detached from car sales.
TSLA AVOID
Medium-term
"You don't hold cash to make money. You hold cash to stabilize the process... even in your best case scenario of Bitcoin being a good investment, I don't want companies holding Bitcoin." Corporate treasuries holding volatile assets (Bitcoin) instead of cash fail their primary duty (stability/liquidity). This introduces unnecessary existential risk to the operating company. Avoid companies that treat their balance sheet like a hedge fund (specifically referencing the MicroStrategy model). Bitcoin price skyrockets, justifying the gamble in the short term.
MSTR AVOID
Long-term
"Amazon probably has the broadest business that it can go after because it's a disruption machine... it is the company probably that has the greatest capacity to get to 10 trillion." Unlike Nvidia (pure chip play), Amazon's infrastructure and logistics allow it to disrupt multiple sectors simultaneously, giving it the highest total addressable market (TAM) ceiling among the Mag 7. Amazon is the most likely candidate to reach the next market cap milestone ($10T). Regulatory breakup or slowing AWS growth.
AMZN LONG
Long-term
"Gold prices are up almost 70%, silver price are up 150% [in 2025]... difficult phenomenon to explain unless you argue that there's a loss of trust." Investors are losing faith in central banks and government fiat management (institutional trust). This drives capital into non-sovereign stores of value, regardless of inflation rates. Momentum in precious metals is driven by a structural shift in sentiment (trust), not just inflation data. Restoration of faith in central bank policy or a deflationary crash.
SLV LONG
GLD LONG
Medium-term
"I am holding back because the market is richly priced... holding back a little idle cash into US stocks... hanging out in T bills." With the Equity Risk Premium at ~4% and potential global economic transitions, the risk/reward favors holding a cash buffer (T-Bills) over full equity deployment. Maintain a cash buffer for optionality and protection. Market melt-up (missing out on gains).
BIL LONG
SGOV LONG
Short-term
15:00
Feb 13
Feb 13
Meb Faber Show
6mo
VEU 1ST
EUFN 1ST
LQD 1ST
GLD 1ST
HYG 1ST
▾
Global investors are maximally overweight US equities. US valuations are stretched, while international markets trade at wide discounts. History shows winners rotate; US exceptionalism is not permanent. Mean reversion in valuations and a shift in capital flows away from the crowded US trade will benefit international indices. The "Rest of the World" offers a margin of safety that the US does not. Long Global ex-US Equities to capture valuation mean reversion. The US economy continues to significantly outgrow global peers due to tech dominance and demographics.
VEU LONG
VXUS LONG
medium-term
Meb points out that European banks have quietly outperformed the "Mag 7" and the S&P 500 over the last 1, 3, and 5 years. This performance divergence signals a regime shift from growth/tech to value/financials that the broader market has largely ignored. The trend is established but sentiment remains bearish/neutral, offering a "wall of worry" to climb. Long European Financials to chase established momentum in a neglected sector. A European recession or ECB policy error cutting rates too aggressively, hurting bank net interest margins.
EUFN LONG
medium-term
Jim argues that in a high-inflation fiat world, government bonds (low yield) are dangerous. However, he notes that credit defaults historically never erode the extra spread you get over government bonds. To make a 60/40 portfolio work today, the "40" (bonds) must work harder. By moving down the capital structure into corporate credit (Investment Grade or High Yield), investors gain a yield buffer that protects against inflation, which government bonds fail to provide. Long Corporate Credit (IG/HY) over Sovereign Treasuries. A severe credit event or recession causing a spike in defaults beyond historical norms.
LQD LONG
HYG LONG
long-term
Jim notes that since the world moved to a fiat currency system in 1971, money is "backed by nothing" and authorities respond to crises by printing money. Gold has been the best-performing asset of the 21st century. In a regime of fiscal dominance and monetary debasement, hard assets act as the only true hedge against the erosion of purchasing power. Unlike the pre-1971 era, gold is now unchained from currency pegs, allowing it to reprice fiat instability. Long gold as a hedge against inevitable future monetary expansion and inflation. A return to strict monetary discipline or a deflationary bust where cash outperforms hard assets.
GLD LONG
long-term
Jim describes the UK as having a "PR problem." Despite being one of the faster-growing G7 economies with decent frameworks for capitalism, global investors view it as a "basket case," leaving valuations depressed. When sentiment is disconnected from economic reality, it creates a value opportunity. As the political noise settles and investors look for non-US value, the UK's low multiples become attractive relative to its growth profile. Long UK Equities as a deep value contrarian play. Continued political instability or post-Brexit structural economic drag.
EWU LONG
medium-term
The US market is extremely concentrated (Mag 7 are ~35% of S&P). Current valuations are at historical extremes (CAPE ratio near 2000 levels). Following the 2000 peak, the S&P 500 went sideways for 13 years, while the Equal Weight index doubled. Market cap-weighted indices are currently a bet on momentum and extreme valuation expansion continuing. Equal weighting removes the concentration risk of the "Mag 7" and increases exposure to cheaper, average stocks that historically outperform when bubbles unwind. Long Equal Weight S&P 500 to maintain US exposure while mitigating valuation and concentration risk. The "Mag 7" continue to compound earnings faster than the broad market, driven by AI productivity gains.
RSP LONG
medium-term
15:01
Feb 06
Feb 06
Meb Faber Show
7mo
DFJ 1ST
CHNA 1ST
EWJ 1ST
SPY 1ST
DXJ 1ST
▾
The median Japanese company holds ~7 years of net income in assets (vs. 1 year for US companies). Corporate governance reforms are pressuring these companies to increase payouts (dividends/buybacks). There is a massive "value unlock" potential as these unproductive assets are distributed to shareholders. The return of inflation signals nominal GDP growth, breaking the deflationary mindset. LONG. It is a deep value play with a specific catalyst (governance reform) that does not rely on massive tech innovation. Cultural resistance to rapid change (slow-moving consensus); currency volatility (Yen weakness).
DFJ LONG
EWJ LONG
DXJ LONG
medium-term
Big Pharma is increasingly buying early-stage assets from China (30-40% of acquisitions vs. single digits previously). Clinical trials in China are significantly cheaper and faster. China has successfully built a biotech infrastructure that is now integrating into the global supply chain. As US/EU firms outsource early development to China for speed/cost, Chinese biotech firms become prime M&A targets or dominant players in early-stage discovery. LONG. This is a contrarian play on Chinese innovation capabilities rather than just consumer demand. Geopolitical tensions; regulatory changes regarding data acceptance (though currently improving); US restrictions on Chinese biotech.
CHNA LONG
KURE LONG
long-term
US valuations are high, but the US is undergoing a "unique in history innovation wave" (Cloud, AI). Unlike other markets, US companies have actually grown into their high multiples through tangible technological revolutions. Betting against US innovation has historically been a losing trade. LONG. High valuations are a feature of high innovation, not necessarily a bubble. Mean reversion in profit margins; regulatory crackdowns on Big Tech.
SPY LONG
QQQ LONG
long-term
Biotech is the most uncorrelated sector with the highest dispersion. 70% of unprofitable biotechs lose money, but the sector has experienced a massive drawdown (historically followed by massive recoveries). The "baby has been thrown out with the bathwater." A systematic approach filtering for "Quality" (owned by specialists) and "Value" (low Market Cap relative to R&D Spend) identifies winners in a sector where generalist capital has fled. LONG. The sector offers "lottery ticket" positive skewness after a deep cyclical bottom. High failure rate of individual clinical trials; interest rate sensitivity for unprofitable companies.
IBB LONG
XBI LONG
medium-term
Global balance sheets have expanded 5x over 60 years, largely driven by asset price inflation and corporate profits. Corporate profits are being structurally supported by government deficits (Govt borrows -> pays entitlements -> recipients spend at Corps). This cycle supports real assets and equities over cash. LONG. Real assets and equities are the hedge against the "deficit-profit" loop. Fiscal austerity (unlikely); major recession curbing consumer spending.
USO LONG
XLE LONG
long-term
16:24
Feb 05
Feb 05
Meb Faber Show
7mo
LQD 1ST
HYG 1ST
SPY
GDX 1ST
QQQ
▾
Faber explicitly states that the vast majority of the fixed income landscape is "extremely dangerous." He notes that investors are not getting enough yield pickup in corporate or junk bonds to justify the risk. Because credit spreads are too tight, the risk/reward for holding corporate debt is poor. Consequently, his own fixed income fund (TYLD) has moved 100% into T-Bills. Avoid Corporate and High Yield Bond ETFs; prefer short-duration government paper (T-Bills) until spreads widen. A "Goldilocks" economic scenario where defaults remain near zero and yield-hungry investors continue to compress spreads further.
LQD AVOID
HYG AVOID
short-term
Faber compares the current US market (40x P/E) to the 1999 dot-com peak and the 1980s Japan bubble. He cites data showing that buying at these valuations historically leads to 0% real returns over 10 years. The "Market Cap Weighted" approach forces investors to be overweight the most expensive assets (US Tech). To generate returns, one must break the link to market cap weighting (e.g., via Equal Weight or Shareholder Yield). Avoid or reduce exposure to passive US Market Cap weighted indices in favor of active value or global diversification. The US market could continue to "irrational exuberance" levels (e.g., Japan reaching 90x P/E in the 80s) before correcting.
SPY AVOID
QQQ AVOID
long-term
In this 2026 scenario, Faber highlights that Gold is over $5,000 and Silver is over $100. He notes that Costco and Walmart selling gold bars was a sentiment signal that retail demand is structural. Despite US stocks being at highs, Gold has outperformed stocks for the century. The "Real Asset" bucket is historically under-owned by US investors. The trend is explicitly higher in precious metals and miners. Long Precious Metals and Miners (via ETFs or Trend strategies) to participate in the ongoing commodity breakout. A deflationary bust or a sharp strengthening of the US Dollar that suppresses commodity prices.
GDX LONG
SLV LONG
GLD LONG
medium-term
Faber notes that while the US is trading at a "nosebleed" 40x P/E (implying near-zero real returns for the next decade), Foreign Developed markets are in the low 20s, and Deep Value/Emerging markets are in the low teens. This valuation spread is as wide as it was in the 1980s (Japan vs. World). The mean reversion trade has already started (2025 was a monster year for ex-US), and momentum is favoring the cheapest global assets over the expensive US market cap leaders. Long Global Value and International Shareholder Yield to capture the continued rotation out of the US. A "melt-up" continuation in US tech/growth that defies historical valuation gravity.
GVAL LONG
EYLD LONG
FYLD LONG
medium-term
Faber states that Trend Following is having a "face ripper" year in 2026 after a difficult prior period. His trend fund is heavily allocated to ex-US stocks, value companies, and precious metals. Most investors lack exposure to "Real Assets" (Gold/Commodities) and "Deep Value." Trend following strategies automatically rotate into these winning sectors without the emotional bias of the investor, capturing the "Right Tail" of the distribution (e.g., the move in Gold to $5k). Long Trend/Momentum strategies as a vehicle to access the performing asset classes (Commodities/Foreign) that traditional 60/40 portfolios miss. A sharp, choppy market reversal (whipsaw) where trends fail to sustain, causing the strategy to get stopped out repeatedly.
GMOM LONG
short-term
15:00
Feb 03
Feb 03
Meb Faber Show
7mo
EWZ 1ST
RSP 1ST
EFV 1ST
SPY FLIP
QQQ 1ST
▾
Meb highlights that while the US is at ~40x PE, the rest of the world is in the "teens" or "single digits" (specifically mentioning Brazil). He notes "European banks outperforming Mag 7" and a rotation into value. Valuation spreads this wide historically lead to a rotation. Investors seeking yield and reasonable entry points will flow from the expensive US market to cheap International Value and Emerging Markets. Long International Value (EFV) and specific cheap EM countries like Brazil (EWZ). A global recession drags down all equities regardless of valuation; US dollar strength.
EWZ LONG
EFV LONG
VXUS LONG
long-term
Meb notes that the S&P 500 is trading at a CAPE ratio of 40+, while the spread between Market Cap Weight and Equal Weight is extreme (7th percentile on a 5-year basis). He explicitly advocates for "ABMCW" (Anything But Market Cap Weight). When the largest stocks (Mega Caps) become historically expensive, the index becomes top-heavy. Equal Weight indices (RSP) rebalance away from overvalued giants into the average stock, offering a valuation safety net and mean-reversion potential. Long Equal Weight S&P 500 to capture US exposure without the valuation risk of the "Mag 7" successors. Momentum in Mega Caps continues irrationally (the "melt-up" scenario).
RSP LONG
medium-term
Meb compares the current US market dominance (23% of global GDP but a massive chunk of market cap) to the Japanese bubble of the late 1980s. He cites the CAPE ratio of 44 as a "potential turning point." At 44x CAPE, future returns are mathematically destined to be low or negative. The risk/reward for holding passive, market-cap-weighted US indices is historically poor compared to every other asset class mentioned. Avoid or reduce exposure to Market Cap Weighted US Indices. "Animal spirits" push valuations even higher (e.g., CAPE 50) before the crash.
SPY AVOID
QQQ AVOID
long-term
Meb states that Trend Following (Managed Futures) solves portfolio problems by capturing "right tail" events (like the massive move in commodities) while chopping off the "left tail" (drawdowns in stocks). He mentions these strategies are up double digits year-to-date (Jan 2026). In a world where stocks are expensive and commodities are volatile/trending, traditional 60/40 portfolios fail. Managed Futures automatically adapt to go long commodities and short bonds/stocks if trends dictate, acting as a necessary diversifier. Long Managed Futures strategies to hedge against US equity valuation compression. Whipsaw markets (trendless volatility) where the strategy bleeds slowly.
DBMF LONG
KMLM LONG
medium-term
Meb confirms Gold, Silver, and Copper are hitting all-time highs (Silver broke $120). He notes that trend followers are "chock full" of these assets and that "normal" investors have zero exposure (under-owned). This is a classic Trend Following setup. The assets are breaking out to new highs, institutional ownership is low, and the "fear of missing out" (FOMO) phase hasn't fully hit the retail public yet. The breakout signals a continuation of the trend. Long Precious Metals and Industrial Metals via liquid ETFs. A sharp reversal in inflation expectations or a liquidity crunch causing a sell-everything moment.
GLD LONG
SLV LONG
CPER LONG
short-term
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