Century Management Presentation to TEXPers

[txlaw]

Some pretty interesting comments regarding the economic future of the US.

 

[ERICOPOLY]

How does he figure cash increases 6x in a Depression?

 

[ERICOPOLY]

He also says the economy normally grows at a 6% rate. 

 

[txlaw]

Yeah, there is also a lot of chart voodoo in there where he is focused on the price of the market overall, in addition to the unexplained things like the 6X return on cash in deflationary times and the manufacturing renaissance (he doesn't attempt to explain why manufacturing might be coming back to the US).  I did like the last video where he notes the tailwinds of the nat gas production explosion, the emergence of the housing market, and American ingenuity (little cheesy, I know) -- squares with WEB's views in many respects.  He does gloss over the public sector debt/unfunded liabilities problem, though.

 

Does anyone know whether Vanderberg has always focused on the macro or whether this is a more recent phenomenon to deal with his client base (e.g., TEXPers)?

[ERICOPOLY]

  On 4/14/2012 at 3:12 PM, txlaw said:

  He does gloss over the public sector debt/unfunded liabilities problem,

 

He states that the "normal" growth rate for the economy is 6%.  This kind of fairy dust can wave off a lot of bad news.

 

I suppose it's very easy for him to find value given that macro model.  Wouldn't you be concerned if your money manager said something like that?

[mankap]

I think he meant that after deep recessions , economy normally grows 6%.

[txlaw]

  On 4/14/2012 at 3:32 PM, ERICOPOLY said:

  Quote

  He does gloss over the public sector debt/unfunded liabilities problem,

 

He states that the "normal" growth rate for the economy is 6%.  This kind of fairy dust can wave off a lot of bad news.

 

I suppose it's very easy for him to find value given that macro model.  Wouldn't you be concerned if your money manager said something like that?

 

I don't recall whether he said that the US economy normally grows at a 6% rate. 

 

If he did, that's crazy.  If he said that 6% from a "bottom" is normal growth rate, that's more reasonable.  But, regardless, I don't think it makes sense to rely on past US growth rates to predict future US growth rates. 

 

His quantitative and chartist stuff seems not so rigorous to me.  His qualitative points were good ones.  But I wonder how much of his comments are directed towards making his AUM (TEXPers is a large client, I presume) comfortable with his being aware of macro matters.