In Part 2, David Booth reflects on how Dimensional Fund Advisors expanded by partnering with fee-only financial advisors, helping to bring academic investing principles to individual clients. He emphasizes the importance of low fees both in appealing to personal investors and in delivering superior results to them. Booth discusses how his collaboration with leading finance professors led him to regard the University of Chicago as a business partner and describes his gift to the school as a “partnership distribution.”

David Booth, one of the best-known investors in the world, founded Dimensional Fund Advisors (DFA) along with Rex Sinquefield and brought asset-class investing, a description that embraces both index funds and the index-based but value-added strategy that DFA pursues, to individual investors as well as institutions. David, who received a PhD from the University of Chicago’s Graduate School of Business,  also made the largest donation in the University of Chicago’s history and, in recognition of that gift, the university renamed its business school the Booth School of Business.

In building DFA, David pioneered the use of finance academics as advisors and board members. Eugene Fama, the Nobel Prize-winning economist associated with the efficient market hypothesis, was his dissertation chairman, an early investor in DFA, and a current director of the firm. Other noted academics associated with the firm include Robert Merton, Roger Ibbotson, and Kenneth French.

In Part 1 of his interview, Booth joins Larry Siegel to reflect on the academic revolution that reshaped investing, the launch of Dimensional’s first small-cap strategies, and the challenges of selling a new idea to skeptical markets at a time when index and index-like funds were in its infancy. He shares stories from the University of Chicago’s golden age of financial economics and explains why investing in an index with an eye to adding value through trading and inventory management – not strictly passive indexing – became Dimensional’s guiding philosophy.

In this episode, host Lotta Moberg is joined by Philip Maymin via Starlink to discuss the future of AI in the finance industry.

Dr. Philip Maymin is Portfolio Manager and Director of Asset Allocation Strategies at Janus Henderson. He is also the Endowed Schramm Chair of Analytics and the MSBA Program Director at Fairfield Dolan, the CTO for Swipe.bet, and an instructor at Analytics.Bet. 

In the past, he has been a portfolio manager at Long-Term Capital Management, Ellington Management Group, and his own hedge fund. He was Assistant Professor of Finance and Risk Engineering at the NYU School of Engineering, as well as an analytics consultant with several NBA teams and the Chief Analytics Officer for Vantage Sports.

Maymin co-founded the journals Algorithmic Finance and the Journal of Sports Analytics. Additionally, he was a policy scholar for a free market think tank, a Justice of the Peace, a Congressional candidate, and an award-winning journalist. 

In this episode, Prof. William Goetzmann joins host Larry Siegel to discuss financial archeology, and how the early history of financial institutions can inform modern practices. 

William N. Goetzmann is the Edwin J. Beinecke Professor of Finance and Management Studies at the Yale School of Management, and executive editor of the Financial Analysts Journal. He won the James R. Vertin Award from the CFA Institute for “research notable for its relevance and enduring value to investment professionals.”

He is author of the highly acclaimed book, Money Changes Everything: How Finance Made Civilization Possible.

Prior to his academic career, Goetzmann worked as an archaeologist, a writer and producer of PBS documentaries, and served as the director of the American Museum of Western Art in Denver, Colorado during 1984–85.

Laurence B. Siegel is the Gary P. Brinson Director of Research at the CFA Institute Research Foundation and a writer, speaker, and consultant. He is the author of Fewer, Richer, Greener: Prospects for Humanity in an Age of Abundance and Unknown Knowns: On Economics, Investing, Progress, and Folly. He has also written or co-authored several CFA Institute Research Foundation monographs and briefs.

Earlier in his career, Larry was director of research in the investment division of the Ford Foundation and, before that, Ibbotson Associates (now part of Morningstar). He holds BA (1975) and MBA (1977) degrees from the University of Chicago. His website is http://www.larrysiegel.org

Financial Thought Exchange is brought to you by the CFA Institute Research Foundation. If you would like to support the show and our work, please use the following donation link: https://rpc.cfainstitute.org/en/research-foundation/donate

In this episode, host Lotta Moberg is joined by Joseph Simonian to discuss the importance of understanding the field of model validation and how it applies to the financial industry. 

His published work on the topic can be found here: https://rpc.cfainstitute.org/en/research/foundation/2024/investment-model-validation

Joseph Simonian is a globally renowned investor and researcher who has
conducted extensive research in quantitative finance, machine learning, factor
investing, and portfolio construction. Over the course of a 20-year career in the
investment industry, he has held senior portfolio management and research
positions in several prominent asset management firms. He is also the founder
and CIO of Autonomous Investment Technologies.

Simonian is a noted contributor to leading finance journals and a prominent
speaker at investment events worldwide. He is co-editor of the Journal of
Financial Data Science, is on the editorial board of the Journal of Portfolio
Management, chairman of the board of directors of the Financial Data
Professional Institute, and a member of the CFA Institute Research and Policy
Center Technical Commitee. Simonian has authored over 40 publications in
leading investment journals. He is co-author of the book Quantitative Global
Bond Portfolio Management and author of Computational Global Macro, slated
for release in 2024.

Financial Thought Exchange is the official podcast and video channel of the CFA Institute Research Foundation. If you would like to support the show and our work, please donate here: https://rpc.cfainstitute.org/en/research-foundation/donate

Bill and Marty Join host Larry Siegel to discuss equity risk premium, spending rates, and investment strategies for retirement. 

William F. Sharpe, born in 1933, is the STANCO 25 Professor of Finance, Emeritus at Stanford University’s Graduate School of Business. He was one of the originators of the Capital Asset Pricing Model and is the best-known exponent of it. He developed the "Sharpe Ratio" for investment performance analysis, and is one of the most widely published and celebrated authors of journal articles in the history of finance. He wrote the best-selling textbook, Investments, and many other books. In 1990, he received the Nobel Prize in Economic Sciences.

Martin L. Leibowitz is President of Advanced Portfolio Studies LLC (APS), a consulting firm focused on issues of asset valuation and portfolio allocation. Dr. Leibowitz currently serves on the investment committees of Singapore’s GIC, the Institute for Advanced Study, the Carnegie Corporation, the IMF pension system, and the American Academy of Arts and Sciences.

In 2021, Leibowitz received the Singapore National Day Award for his work with the GIC fund. In 2015, he was named “Financial Engineer of the Year” by the IAQF. He has written over 300 articles and has been the most frequently-published author in both the Financial Analysts Journal (FAJ) and the Journal of Portfolio Management (JPM). Ten of his FAJ articles have received Graham and Dodd Awards. He is one of very few recipients who have received all three of the CFA Institute’s highest awards.

Financial Thought Exchange is the official podcast and video channel of the CFA Institute Research Foundation. If you would like to support the show and our work, please donate here: https://rpc.cfainstitute.org/en/research-foundation/donate

Mark joins host Lotta Moberg to discuss relevance-based prediction, a transparent and adaptive alternative to machine learning. 

Mark Kritzman, CFA is a Founding Partner and CEO of Windham Capital Management, LLC. He is also a Founding Partner of State Street Associates, and he teaches a graduate finance course at the Massachusetts Institute of Technology.

Mark served as a Founding Director of the International Securities Exchange and as a Commissioner on the Group Insurance Commission of the Commonwealth of Massachusetts. He also served on the Advisory Board of the Government Investment Corporation of Singapore (GIC) and the boards of the Institute for Quantitative Research in Finance, The Investment Fund for Foundations, and State Street Associates.

He is currently a member of the Advisory Board of the MIT Sloan Finance Group, the Board of Trustees of St. John’s University, the Emerging Markets Review, the Journal of Alternative Investments, the Journal of Derivatives, the Journal of Investment Management, where he is Book Review Editor, and The Journal of Portfolio Management.

Relevance-based prediction is a new approach to data driven forecasting which serves as a favorable alternative to both linear regression analysis and machine learning. In this episode, Mark Kritzman, one of the leading researchers in this field, joins us to discuss the seminal scientific innovations underlying this approach to predictions, namely the Prasanta Mahalanobis’ distance measure and Claude Shannon’s information theory.

We also discuss the three key tenets of relevance-based prediction, that of relevance, which measures the importance of an observation to a prediction, fit, which measures the reliability of each individual prediction task, and codependence, which holds that the choice of observations and predictive variables should be determined jointly for each individual prediction task. Get ready for a highly educational, stimulating, and demanding episode!

To review Mark's work for yourself, use the links below:

JOIM paper (Relevance)

https://globalmarkets.statestreet.com/research/portal/insights/article/5985847c-60d8-418a-9334-5838b009058f

JFDS paper (Relevance-Based Prediction)

https://globalmarkets.statestreet.com/research/portal/insights/article/7c6fcbd8-8ed3-4c84-b722-d2d24d99c082

To purchase a copy of his book, use the links below:

https://www.predictionrevisited.com/

https://www.wiley.com/en-us/Prediction+Revisited%3A+The+Importance+of+Observation-p-9781119895596

Financial Thought Exchange is the official podcast and video channel of the CFA Institute Research Foundation. If you would like to support the show and our work, please donate here: https://rpc.cfainstitute.org/en/research-foundation/donate

In this episode, Tom & Paul join host Lotta Moberg for the fourth time to finish their conversation covering how life-cycle finance provides a practical, integrated three-stage model for financial planning that not only embraces life-cycle finance but also integrates it with single-period optimization models.

Thomas M. Idzorek, CFA, is chief investment officer, retirement, for Morningstar Investment Management LLC. He also serves as a member of Morningstar’s 401(k) committee, Public Policy Council, Global Investment Committee, U.S. Investment Policy Committee, the editorial board of Morningstar magazine, and the Journal of Investment Management conference series Advisory Board.

Paul D. Kaplan, CFA, was director of research for Morningstar Canada and a senior member of Morningstar’s global research team. He led the development of many of the quantitative methodologies behind Morningstar’s fund analysis, indexes, adviser tools, and other services. Kaplan conducted research on asset allocation, retirement income planning, portfolio construction, index methodologies, and other investment topics.

To review their research in its entirety, click here: https://rpc.cfainstitute.org/en/resea... Financial Thought Exchange is the official podcast and video channel of the CFA Institute Research Foundation. If you would like to support the show and our work, please donate here: https://rpc.cfainstitute.org/en/resea...

Thomas M. Idzorek, CFA, is chief investment officer, retirement, for Morningstar Investment Management LLC. He also serves as a member of Morningstar’s 401(k) committee, Public Policy Council, Global Investment Committee, U.S. Investment Policy Committee, the editorial board of Morningstar magazine, and the Journal of Investment Management conference series Advisory Board.

Paul D. Kaplan, CFA, was director of research for Morningstar Canada and a senior member of Morningstar’s global research team. He led the development of many of the quantitative methodologies behind Morningstar’s fund analysis, indexes, adviser tools, and other services. Kaplan conducted research on asset allocation, retirement income planning, portfolio construction, index methodologies, and other investment topics.

In this episode, Tom & Paul join host Lotta Moberg for the third time to continue their conversation covering how life-cycle finance provides a practical, integrated three-stage model for financial planning that not only embraces life-cycle finance but also integrates it with single-period optimization models.

To review their research in its entirety, ⁠click here⁠.  

Financial Thought Exchange is the official podcast and video channel of the CFA Institute Research Foundation. If you would like to know more about who we are and what we do, please ⁠click here⁠.

If you would like to support the show and our work, please donate using this link: ⁠https://rpc.cfainstitute.org/en/research-foundation/donate

Thomas M. Idzorek, CFA, is chief investment officer, retirement, for Morningstar Investment Management LLC. He also serves as a member of Morningstar’s 401(k) committee, Public Policy Council, Global Investment Committee, U.S. Investment Policy Committee, the editorial board of Morningstar magazine, and the Journal of Investment Management conference series Advisory Board.

Paul D. Kaplan, CFA, was director of research for Morningstar Canada and a senior member of Morningstar’s global research team. He led the development of many of the quantitative methodologies behind Morningstar’s fund analysis, indexes, adviser tools, and other services. Kaplan conducted research on asset allocation, retirement income planning, portfolio construction, index methodologies, and other investment topics.

Tom & Paul join host Lotta Moberg for the second time to continue discussing how life-cycle finance provides a practical, integrated three-stage model for financial planning that not only embraces life-cycle finance but also integrates it with single-period optimization models. Here is a link to their research: https://rpc.cfainstitute.org/en/research/foundation/2024/lifetime-financial-advice-a-personalized-optimal-multilevel-approach

Financial Thought Exchange is the official podcast and video channel of the CFA Institute Research Foundation. If you would like to support the show and our work, please donate here: https://rpc.cfainstitute.org/en/research-foundation/donate

Mike Dowdall is Chief Investment Officer of Alternative Fund Advisors and the portfolio manager of the AFA Private Credit Fund. He is responsible for the investment sourcing, due diligence, and positioning of the AFA Private Credit Fund.

Prior to joining Alternative Fund Advisors, Mike was a director and the portfolio manager at BMO Global Asset Management, where he managed the US multi-asset and multi-alternative portfolios.

Mike is a member of the CFA Society of Chicago and is a CFA Charterholder. He received an MBA from the University of Chicago Booth School of Business and a BBA from the University of Notre Dame.

In this episode, Mike joins host Lotta Moberg to discuss the future of alternative credit and the myriad of associated factors and risks. 

His published work on the topic can be found here (pages 84-93): https://rpc.cfainstitute.org/-/media/documents/article/rf-brief/introduction-to-alt-credit.pdf

Financial Thought Exchange is brought to you by the CFA Institute Research Foundation. If you would like to support the show and our research, please use the following link: https://rpc.cfainstitute.org/en/research-foundation/donate

Nick joined Vantage Infrastructure in 2012 to build out the global infrastructure debt platform and has more than 25 years of relevant experience. Nick leads the North American business, including investments origination, execution and portfolio management. He is a member of the Investment Committee and the firm’s global Executive Committee.

Prior to joining Vantage Infrastructure, Nick spent over six years in the banking industry across energy, resources, project and infrastructure financing. 

Nick holds a Bachelor of Surveying degree from the University of Tasmania, and a Master of Business Administration from the Macquarie Graduate School of Management, Australia.

Nick joins host Lotta Moberg to discuss the intersection of the infrastructure and financial industries and how infrastructure debt finances the interconnected world we live in today. 

His published work on the topic can be found here (pages 67-73):  https://rpc.cfainstitute.org/-/media/documents/article/rf-brief/introduction-to-alt-credit.pdf

Financial Thought Exchange is brought to you by the CFA Institute Research Foundation. If you would like to support the show and our research, please click here.

#alternativecredit #infrastructure #altcredit #financepodcast #businesspodcast

In this episode of the Financial Thought Exchange podcast, host Lotta Moberg, CFA, and Marty Fridson, CIO at Lehman Livian Friedson Advisors, delve into the complexities of financial statements and corporate reporting. They discuss how companies often present financial health to their advantage, using Fridson's book, "Financial Statements," as a guide. The conversation covers regulatory impacts, the role of goodwill in valuation, and the challenges of assessing acquisitions. Fridson emphasizes the importance of critical analysis and cash flow generation in valuing companies, providing insights into navigating financial reporting pitfalls.

Zack Ellison, CFA, CAIA is the founder and managing general partner of Applied Real Intelligence (A.R.I.) and the chief investment officer of the A.R.I. Senior Secured Growth Credit Fund, which provides debt financing solutions to premier startups in North America.

He previously worked as a loan structurer and underwriter, investment banker, corporate bond trader, and fixed income portfolio manager at three firms with over $1 trillion in assets – Scotia Bank, Deutsche Bank, and Sun Life.

Mr. Ellison holds an MBA from the University of Chicago, an MS in Risk Management from NYU, and is completing his Doctorate in Business Administration at the University of Florida.

His views on investing in innovation and venture debt are showcased in monthly columns he writes for Venture Capital Journal and Built In, as well as engaging discussions with leading investors each week on The 7 in 7 Show with Zack Ellison (Podcast). Additionally, he authored the Venture Debt chapter in the recently released book from the CFA Institute Research Foundation:  An Introduction to Alternative Credit. For a deeper dive into A.R.I.'s pioneering growth credit and venture debt solutions and to discover how they're shaping the future of startup financing, visit www.arivc.com.

Financial Thought Exchange is the official podcast and video channel of the CFA Institute Research Foundation. If you would like to support the show and our work, please use the donation link below: https://rpc.cfainstitute.org/en/research-foundation/donate

Thomas M. Idzorek, CFA, is chief investment officer, retirement, for Morningstar Investment Management LLC. He also serves as a member of Morningstar’s 401(k) committee, Public Policy Council, Global Investment Committee, U.S. Investment Policy Committee, the editorial board of Morningstar magazine, and the Journal of Investment Management conference series Advisory Board.

Paul D. Kaplan, CFA, was director of research for Morningstar Canada and a senior member of Morningstar’s global research team. He led the development of many of the quantitative methodologies behind Morningstar’s fund analysis, indexes, adviser tools, and other services. Kaplan conducted research on asset allocation, retirement income planning, portfolio construction, index methodologies, and other investment topics. 

Tom & Paul join host Lotta Moberg to discuss how lifecycle finance's wide, encompassing approach provides an over-arching framework for individuals to better invest their money over the course of their life. Here is a link to their published research: https://rpc.cfainstitute.org/research/foundation/2024/lifetime-financial-advice-a-personalized-optimal-multilevel-approach

Financial Thought Exchange is the official podcast and video channel of the CFA Institute Research Foundation. If you would like to support the show and our work, please use the donation link below: https://rpc.cfainstitute.org/en/research-foundation/donate

Stephen Sexauer is SDCERA’s Chief Investment Officer and oversees SDCERA’s $17 billion pension Trust Fund, investment team, and investment consultants. Sexauer graduated from the University of Illinois with a BS in Economics and from the University of Chicago with an MBA in Economics and Finance.

Laurence B. Siegel is the Director of Research at the CFA Institute Research Foundation and a writer, speaker, and consultant. Siegel graduated from the University of Chicago with both a BA & a MBA. His website is http://www.larrysiegel.org.

Sexauer and Siegel describe the “bolt from the blue” represented by Harry Markowitz’s 1952 discovery of mean-variance optimization for investment portfolios. They indicate how optimization has been applied and misapplied, and suggest a new heuristic for combining optimizer outputs with other information.

Their published work on the topic can be found here: https://rpc.cfainstitute.org/en/research/financial-analysts-journal/2023/harry-markowitz-and-the-philosophers-stone

Financial Thought Exchange is brought to you by the CFA Institute Research Foundation. If you would like to support the show and our work, please use the following donation link: https://rpc.cfainstitute.org/en/research-foundation/donate

Alfonso Ricciardelli, CFA, is based in New York City. He is a Co-Founder at Noosk, a social platform for knowledge-based content. Alfonso's career spans 15 years between politics and finance. 

Alfonso joins host Lotta Moberg in the first ever episode of the Financial Thought Exchange podcast to discuss the basics of alternative credit and its usefulness as an asset class. His published work on the topic can be found here: https://rpc.cfainstitute.org/research/foundation/2024/an-introduction-to-alternative-credit

Like what you hear? Support the podcast and the CFA Institute Research Foundation's work by donating using this link: https://www.paypal.com/donate/?cmd=_s-xclick&hosted_button_id=SWD7KR9V7RR86&ssrt=1710192489993

In this episode of the Financial Thought Exchange podcast, host Lotta Moberg, CFA, and Marty Fridson, CIO at Lehman Livian Friedson Advisors, delve into the complexities of financial statements and corporate reporting. They discuss how companies often present financial health to their advantage, using Fridson's book, "Financial Statements," as a guide. The conversation covers regulatory impacts, the role of goodwill in valuation, and the challenges of assessing acquisitions. Fridson emphasizes the importance of critical analysis and cash flow generation in valuing companies, providing insights into navigating financial reporting pitfalls.

Jim Simons, the late founder of Renaissance Technologies, achieved a track record that surpasses Warren Buffett and all the other great investment managers – by a lot. In a beautifully written account, The Man Who Solved the Market, Gregory Zuckerman, the Wall Street Journal who previously profiled John Paulson in The Greatest Trade Ever, talks about Renaissance’s unique culture. The firm brought geniuses from far outside the investment world – mathematicians, computer scientists, linguists – together into an effort that, surprisingly, beat the investment community’s best analysts and traders at generating returns and catapulted “quant” investing to the forefront.

Allison Schrager is one of the world’s foremost experts on personal risk. An economist by training, she has broadened her reach to learn about the risk management strategies of people who jump out of airplanes, surf big waves, and work in brothels. She is a senior fellow at the Manhattan Institute, a contributing editor at City Journal, and a columnist at Bloomberg Opinion and practically everywhere else.

Cliff Asness, co-founder of AQR Capital Management, shares his origin story, detailing his academic background at the University of Chicago, where he was influenced by prominent figures like Eugene Fama, who encouraged him to explore momentum investing although Fama did not think it could possibly work. Asness recounts his transition from portfolio manager at Goldman Sachs to co-founder and principal research at AQR Capital, one of the best-known investment management firms in the world. He reflects on the tumultuous market period after AQR’s founding in 1998, when the nascent firm almost went out of business.

The conversation addresses market efficiency, with Asness presenting his views on the "Less Efficient Market Hypothesis." Despite advancements in technology and data availability, he says, the processing of information has not necessarily improved, leading to inefficiencies in the market. Asness discusses the impact of passive investing on market dynamics and the challenges of generating alpha in a landscape where traditional value investing has performed poorly. The episode concludes with Asness sharing insights on the role of machine learning in quantitative finance, emphasizing its potential to enhance research and signal generation while maintaining a balance with economic theory.

Roger G. Ibbotson, Professor Emeritus at Yale School of Management and chairman and CIO of Zebra Capital Management LLC, has authored numerous articles and books, including Stocks, Bonds, Bills, and Inflation, which serves as a standard reference for information and capital market returns.

Laurence B. Siegel is the Director of Research at the CFA Institute Research Foundation and a writer, speaker, and consultant. Siegel graduated from the University of Chicago with both a BA & a MBA. His website is http://www.larrysiegel.org.

Ibbotson and Siegel discuss the driving factors behind long-term returns, how human behavior and investor psychology intervene in financial decision-making, and the future of returns in an interconnected world. From systems of economic production to sustainable investing, they draw on decades of research in financial markets to dive further into these topics.

Financial Thought Exchange is brought to you by the CFA Institute Research Foundation. If you would like to support the show and our work, please use the following donation link: https://rpc.cfainstitute.org/en/research-foundation/donate

Anthony DeChellis hosts industry veterans Brian Singer, CFA, and Lotta Moberg, CFA, to discuss their recently released CFA Institute Research Foundation brief, Financial Entrepreneurship: Balancing Active and Passive Investment Horizons. The conversation explores the evolution of the asset management industry over the decades, highlighting shifts from traditional investment approaches to innovative strategies. Brian and Lotta share insights from their decade-long collaboration and the journey that led to their current research, shedding light on the changing landscape of finance and investment. Tune in to discover how these developments impact investors and the financial sector as a whole.

In this episode, host Lotta Moberg is joined by Dr. William Hardin to discuss the philosophical relationship between education and finance, and how to properly utilize a financial education in the business world at large.  

Dr. William Hardin is Dean of the FIU (Florida International University) College of Business. He is Founding Director of the Tibor and Sheila Hollo School of Real Estate and was Associate Dean for the Chapman Graduate School of Business at FIU.

Financial Thought Exchange is brought to you by the CFA Institute Research Foundation. If you would like to support the show and our work, please use the following donation link: https://rpc.cfainstitute.org/en/research-foundation/donate

In this second episode segment, Larry Speidell, founder and CIO of Frontier Global Partners focuses on personal stories, travel experiences, and deeper insights into frontier markets.

For example, Speidell praises Botswana’s development, aided by diamond discoveries, but also discusses the “resource curse,” where reliance on natural resources can hinder broader economic growth.

Speidell’s firm does not shy away from politically unstable countries such as Peru and Georgia. In such environments, he says, strong companies can thrive, and investors must be patient.

Larry describes the transformative impact of mobile technology in frontier markets, such as Kenya’s M-PESA, a banking app that greatly helps the previously “unbanked” to make a living.

The episode blends investment insights with cultural reflections, emphasizing patience, optimism, and the human side of global investing.

In this two-part episode, Lawrence Speidell, founder and CIO of Frontier Global Partners, discusses his Indiana Jones-like foray into frontier markets in search of stocks to buy for his firm’s clients. Frontier markets are countries that are less developed than those in emerging market indexes.

Larry’s interest in frontier markets began during a lecture trip to China in the 1980s.
Frontier markets include Vietnam, Bangladesh, Romania, Colombia, and many countries in Africa. Speidell argues that, despite political instability, such markets are not necessarily riskier than developed ones, which have also seen increasing volatility. Frontier markets, he says, are highly varied with a low correlation to developed markets, so they are a good diversifier.
While frontier-market economies are a significant share of global GDP, their stock markets remain underdeveloped. Speidell believes this gap will close over time, offering long-term investment opportunities. Progress in frontier markets is slow, however, and requires patience, which Speidell argues is a good approach to investing generally. 

Thomas Coleman, an economics professor at the University of Chicago, discusses a novel theory of money and inflation, inequality, and risk management with the CFA Institute Research Foundation’s Larry Siegel.

The “money” referred to in monetary economics is a thing of the past, says Tom, because nobody has any “money” (cash, checking accounts, savings accounts). They have marketable assets instead. So monetarism is outdated as a theory of inflation. Instead, Tom argues inflation is better explained by the Fiscal Theory of the Price Level (FTPL), which relates the price level to the value of government-issued securities (bonds and cash) as determined by the cash flows backing them. These cash flows are taxes minus government spending.

The FTPL explains the low inflation of 2008 and high inflation of 2022 better than any other theory.

Coleman also discusses inequality. While conventional measures of inequality look at taxable incomes, he takes a broader view, including transfer payments and other items not reported on tax returns as income. When you do this, inequality – while still worse than in the 1980s – is less severe than it appears. In fact, households in the bottom half of the income distribution face a tax rate that is negative!

Tom concludes with thoughts on risk, a topic on which he has written two excellent books.

This episode of the Financial Thought Exchange Podcast features a discussion between host Lotta Moberg and James Grant, founder and editor of Grant's Interest Rate Observer. They explore the U.S. fiscal situation, potential default scenarios, and the implications for interest rates and bonds, highlighting the complexities of fiscal dominance and historical precedents in U.S. monetary policy. This episode is the second of a two-part series. Check out the previous one, which focused on the fundamentals of interest rates.

In the Financial Thought Exchange podcast, host Lotta Moberg interviews James Grant, founder and editor of Grant's Interest Rate Observer, about interest rates and their fundamental nature. They dig into the fundamental nature of interest rates and how they reflect scarcity, opportunity cost, and the human tendency to prioritize immediate gratification over future benefits. The discussion also touches on the complexities of credit risk and the historical context of interest rates. This episode is the first of a two-part series, with the next focusing on U.S. debt and potential defaults.

Elroy Dimson, who co-authored the first very long-term study of worldwide asset returns, explains to Larry Siegel how he was inspired by Roger Ibbotson to research the topic. Then, he and Larry discuss the relative merits of investing in the United States, other developed markets, and emerging markets as their economies have evolved. While U.S. stocks now form the dominant market in the world, that has not always been the case and may not be in the future. Dimson concludes by recalling how World War II reshaped the world’s capital markets and set the stage for the economic boom that followed.

Elroy Dimson and Larry Siegel discuss the origins of long-term investing by medieval universities, then move to rates of return, both past and future, on stocks versus bonds – there are some surprises in the older data suggesting the equity risk premium may not be as high as it appears. Dimson recounts his involvement with long-term investors such as the Norwegian sovereign wealth fund, and presents lessons for the future. He concludes with “curiosity assets” such as wine, art, and postage stamps. (You should not invest in postage stamps.)

A lively debate on the state of the private credit market, recorded live from the CFA Institute Annual Conference! Financial historian Mark Higgins and alternative investment strategist Alfonso Ricciardelli face off on a critical question of whether the massive influx of capital into private credit is a dangerous bubble or a new, permanent structural shift.

Hosted by Lotta Moberg, this panel explores the risks of "herd behavior," the importance of setting realistic investor expectations, and the vast alpha opportunities in underserved markets. Mark shares historical context, while Alfonso provides a structural counterpoint. This discussion is essential for anyone seeking to understand the future of alternative investments and the crucial role of manager selection.

In this episode of the Financial Thought Exchange podcast, Jason Pereira, host of the Fintech Impact Podcast and an advisor to technology and AI startups, delves into the evolving landscape of robo-advisors and the revolutionary impact of Artificial Intelligence (AI) in wealth management.

In this episode of Financial Thought Exchange, host Larry Siegel interviews Mark Mills, a physicist turned energy and tech expert. Mills argues that there has never been a true energy transition, except for abandoning whale oil. Even as we pursue an energy transition, humanitycontinues to rely on traditional energy sources such as hydrocarbons, wood, even animal power. Mills criticizes the slow adoption of nuclear energy, attributing it to public fears and stringent regulation. He sees promise in new small reactor designs, such as molten salt reactors, while traditional reactor designs suffer from regulatory and technical constraints.

Mills uses the snail darter (which, it turns out, doesn’t exist) as an example of environmental policy gone amuck, hindering growth. He asks that policies weigh environmental considerations against the need for economic development. Mills emphasizes the need for affordable energy to support technologies like air conditioning in developing nations, noting that only increased wealth and advanced technology can achieve the resilience against climate challenges that we need.

In this podcast episode, Mark Mills, a physicist, energy expert, and “tech guru,” argues that the hype around AI is justified but misunderstood, emphasizing its roots in statistical inference (which is not what humans do when they think). He explains that AI’s strength lies in handling fuzzy, human-like tasks, unlike traditional computing’s whiz-bang ability to calculate. This making AI transformative for automation.

Mills addresses concerns about AI displacing jobs, noting that automation historically eliminates some roles but creates others, with 60% of 1960s job categories gone by 2020, yet employment and wages rose. He predicts AI, combined with advancements in materials and machines, will drive a massive productivity boom over the very long run, akin to previous industrial revolutions like the 1920s. He notes that the universe is made up of only three things—matter, energy, and information—and that all three are undergoing simultaneous revolutions, a historically rare event.

Welcome to the Financial Thought Exchange, where we bring you insights from the brightest minds in finance! In this episode, recorded live from the CFA Institute Annual Conference in Chicago, we are honored to sit down with Peter Lazaroff.

Peter is the author of "Making Money Simple" and the Chief Investment Officer at Plancorp Wealth Management, overseeing $7 billion in AUM. He is also the host of the fantastic "Long Term Investor" podcast.

In this deep dive, Peter shares his key takeaways from a panel on decoding investor behavior. We discuss how behavioral finance goes beyond just identifying biases, moving towards strategies that truly help clients feel more confident and content with their financial decisions.

We cover:

• The evolution of behavioral finance and its practical application in wealth management.

• How to tailor financial education across different generations, from Baby Boomers to Millennials.

• The distinct approaches to advice for inherited vs. self-made wealth, and why empathy is crucial.

• Peter's firm's philosophy of avoiding mistakes over chasing perfect returns, and the biggest "mistake" he focuses on mitigating: setting the wrong expectations.

• The role of risk aversion in portfolio design and how Plancorp customizes strategies based on a client's stock/bond split and liquidity profile.

• Why, despite advancements in behavioral finance, human errors will persist, and how technology might assist without replacing the essential human connection in financial advice.

Join us for a candid and insightful conversation that will change how you think about client relationships and investment strategy!

Marlena Lee, Global Head of Investment Solutions at Dimensional Fund Advisors, explains how her team bridges investment research with client needs through systematic, evidence-based approaches. Rather than chasing short-term market moves or stock-picking, Dimensional builds portfolios grounded in decades of academic research and practical data analysis. Lee highlights how the firm evaluates traditional factors—such as size, value, and profitability—while carefully testing new ideas to avoid data-mined results. She underscores the importance of looking beyond simple measures like correlations or Sharpe ratios, encouraging investors to dig deeper into underlying holdings, factor overlaps, and global perspectives. From the challenges of timing premiums to the distortions caused by mega-cap stocks, Lee emphasizes the value of strategic, long-term allocations over tactical shifts. Her remarks offer clarity on what true diversification means and how investors can navigate trade-offs between tracking error and long-term outperformance.

Ehren Stanhope, CFA of O'Shaughnessy Asset Management explains how custom indexing builds on direct indexing by integrating tax loss harvesting, ESG preferences, and quantitative equity factors. He discusses how platforms like Canvas enable personalized portfolio construction while maintaining benchmark alignment. Stanhope also shares insights on the implications of rising interest rates, inflation, and changing asset correlations for long-term investment strategy and risk management.

Sébastien Page, CFA, Head of Global Multi-Asset and CIO at T. Rowe Price, joins the FTE Podcast to explore the intersection of leadership psychology and investment strategy. Drawing from his books Beyond Diversification and The Psychology of Leadership, Page shares how storytelling enhances financial education, the importance of resilience in investing, and how personality traits like openness and agreeableness shape portfolio management. He also reflects on goal-induced blindness, the underrated skill of quitting, and the deeper meaning behind active management. A must-listen for finance professionals and aspiring leaders.