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Ross Gerber

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63
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2021-07-02
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2021-07-02
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  1. “Hour for 20 years. It's going to cost you more. But see, that's not bad inflation because then those people have more money and they spend it. Restaurants are going to get more expensive. Don't eat at a restaurant. If you don't want to pay $25 for an entrepreneur.”

    2021-07-02 · We Study Billionaires · TIP357: The New Era of Investing w/ Ross Gerber · IDENTIFIED FROM THE TRANSCRIPT

  2. “Has dropped tremendously. Okay. I don't even need a car if I live there, or I buy Tesla and I don't even have to pay for gas and no maintenance. So like you can cut your cost of living very easily right now. So in my mind, there's no inflation. Where's the inflation? Well, if you actually look at the numbers, it's gas prices. Well, that's all fake. Used car like I don't even know how that's relevant just because the car companies can't make enough cars because of the chip prices. That's not really like inflation, right? So you know where there's real inflation is in labor costs. The restaurants are all complaining. They want to still pay $10 an hour. Well, unfortunately, those days are over. Mr. Restaurateur. I'm sorry. This labor now costs more. This is how we solve wealth inequality. It's by a higher minimum wage that people earn. And we're seeing waiters here in LA getting paid $25 an hour, dishwasher, $25 an hour. Some of the restaurant guys are complaining to me. I said, you've been paying $10 an hour.”

    2021-07-02 · We Study Billionaires · TIP357: The New Era of Investing w/ Ross Gerber · IDENTIFIED FROM THE TRANSCRIPT

  3. “He's talking about like money printing. So if you look at how much money we're actually printing relative to how much we have, it's going up like 10 to 12%. So in theory, that's the inflation rate of money. And you can see that inflation in real estate. So real estate prices keep going up 10 to 12 percent. Stock market keeps going up 10 or 12 percent. Well, that's really the dollars going down 10 to 12 percent and asset values look 10 to 12 percent better. So inflation is relative to how you live. I have friends cutting their cost of living left and right because they live in cities like LA and New York and they're saying why am I spending so much money living here when I can move to San Luis Obispo, which is a great town. I have a lot of friends there now and I can buy a house for a million five, bid up to a million eight, right? And a nice place to live. My kids go to school in a public school now and my cost of living because of Zoom.”

    2021-07-02 · We Study Billionaires · TIP357: The New Era of Investing w/ Ross Gerber · IDENTIFIED FROM THE TRANSCRIPT

  4. “Economy in 82 just killed it, but he knew he was going to kill inflation too. And within the eight years of under Reagan, it ended up becoming an amazing economy. That's kind of what needs to be done but won't be done because we don't have those type of people.”

    2021-07-02 · We Study Billionaires · TIP357: The New Era of Investing w/ Ross Gerber · IDENTIFIED FROM THE TRANSCRIPT

  5. “So, the more positive we get now means more pain when you take the drugs away from the drug addict. It's just like a heroin addiction. The economy is addicted and now we're going to pull it away. And what heroin addicts, the hard way is you just like pull it away and it's a horrible period of time for a short term. But then you get healthy. That would be the best thing, even though no politicians are going to do that. So what we'll probably do is get the methadone treatment, which is what Powell's trying to do, where he's like, I'll still keep giving you some, I'm just going to take away a little at a time. And this might take years to do, but we're not going to shock the economy, fix it, and make it better because we all got to get re-elected. And so because we have our system the way it is, nobody has the incentive to do the hard thing because you won't get re-elected. So if you remember back in the 80s and the early 80s when Volcker took over, when there really was inflation, he raised rates to like 15% and killed the”

    2021-07-02 · We Study Billionaires · TIP357: The New Era of Investing w/ Ross Gerber · IDENTIFIED FROM THE TRANSCRIPT

  6. “A lot of things, so PE ratios come down and the economy becomes more normal versus the government just giving free money away. So it'll be a tough year, but it's one year.”

    2021-07-02 · We Study Billionaires · TIP357: The New Era of Investing w/ Ross Gerber · IDENTIFIED FROM THE TRANSCRIPT

  7. “It'll be a painful thing for a year when this goes on, and it'll be good. But like you can't expect the markets to go up forever. So like you have a 2022 PE market that's basically saying rates will be low forever and earnings are going up quite rapidly right now. So then if you think, well, maybe the rates can go to 1%. Maybe the Fed can go to 1%. That's what I think is the highest they can go. That world is still a great world for stocks, but the PE is going to go back to 18. Having an 18 PE stock market versus 22 PE stock market is actually good. It's just like real estate right now. Real estate isn't worth what it's trading at, but I got guys in my office refinancing at 2.5%. They've refinanced five times these guys every month. These guys are refinancing my office, right? And so I'm sitting here thinking, if I can't do that every month to get more money, you know, obviously it changes the growth equation. It changes.”

    2021-07-02 · We Study Billionaires · TIP357: The New Era of Investing w/ Ross Gerber · IDENTIFIED FROM THE TRANSCRIPT

  8. “Well, for a guy whose job is to actually do nothing for the next two years, he has the easiest job in America other than he can't say anything that might even infer that rates might go higher. So his job is to say things that don't spook people because he's actually not going to do anything for a long time. Like if the Fed stops buying so many bonds every month, that's actually a good thing. That's not a bad thing. We do not want the Fed having to spend a trillion dollars a year buying bonds to have fake interest rates. It's not good. So we have to get out of the mess that we've started, but that's a good thing. And I think that's really what the markets will adjust to is that these are good things that are happening. We don't want a world where the Fed has to buy bonds every day, print money, give it to people, and that's the only way people will spend. That's not a world that will last.”

    2021-07-02 · We Study Billionaires · TIP357: The New Era of Investing w/ Ross Gerber · IDENTIFIED FROM THE TRANSCRIPT

  9. “No, it's completely sustainable as long as rates stay low. So the question is whether or not this is a smart way to do things, not whether it's sustainable. So as long as, I mean, the pal's like, I'm not going to raise rates till 2023. I'm like, that's so long from now. I don't even know when that is. So in my mind, the Fed's never going to raise rates again. Because even the discussion has pushed the markets down, commodities drop like a stone just on the discussion, just on the discussion about the discussion about the discussion about rates. So I think that's really the risk. The risk is we go right back into a really slow growth economy in the next two or three years and we get back to what we had in 15, 16 with a slow economy with wage and wealth inequality and a lack of real growth drivers. And so really what the Fed's doing right now is very smart and we need to really push growth forward with the coronavirus.”

    2021-07-02 · We Study Billionaires · TIP357: The New Era of Investing w/ Ross Gerber · IDENTIFIED FROM THE TRANSCRIPT

  10. “Printing as much money as possible. And literally at this point, giving it to people to spend to hopefully create some sort of normal economy again, which obviously isn't going to happen because you're not creating it the way you should. So we've created a very, I would say poor system of growth creation through money printing.”

    2021-07-02 · We Study Billionaires · TIP357: The New Era of Investing w/ Ross Gerber · IDENTIFIED FROM THE TRANSCRIPT

  11. “Incredibly impressive. It innovates so quickly that it can drive costs down for goods and services to such a degree that it literally destroys industries like the oil industry, for example, which is completely manipulated to keep prices high, even though there's this unlimited supply of oil. When you look at things like, oh, I'm worried about inflation, and then you say, well, we have a global supply market where anywhere I can go in the world, I can make something. And if it's too expensive in one country, I just go to another country. And there is no end for inexpensive labor in the global economy. So when you think about the main drivers of inflation, like, you know, the cost of wages, the cost of energy, these are really the main drivers of inflation. There's an unlimited supply. So the real challenge we've had and what the Fed really has been fighting all this time is deflation. And the tools that they're using now is simply”

    2021-07-02 · We Study Billionaires · TIP357: The New Era of Investing w/ Ross Gerber · IDENTIFIED FROM THE TRANSCRIPT

  12. “That was when he figured it out that there is an inflation. What am I thinking? And that's when he got dovish and the market rallied and we had a really good time since Powell and Yellen had that little talk. So now they're working together. And I think it's the best thing ever if you're stock investor. So my fundamental belief system is very different than people on Wall Street or people in my industry because I come from a very different background. So even though I did go to Penn and I spent a lot of time at Wharton and I study traditional finance, I came from a grateful dead background. So I'm very anti-establishment by nature. I'm very anti-government by nature, anti-authority by nature. I very much don't trust what people tell me from the government. So I really look at things differently. And the way I see the world right now is we've been fighting deflation for the last five to ten years that actually technology is so”

    2021-07-02 · We Study Billionaires · TIP357: The New Era of Investing w/ Ross Gerber · IDENTIFIED FROM THE TRANSCRIPT

  13. “I'm really happy with the way the government's changed in the last six months since the Biden election and having yellen back as the Treasury Secretary and Powell at the Fed is like the dream team for the stock market. And when Yellen was at the Fed, I still think she's probably one of the smartest people in finance. When you're dealing with people on that intellectual level, they get things that I think a lot of market participants don't understand because they're not as smart or they think they're smarter than they really are. And so I think the Fed understands and what Powell was talking about, and I think Powell's come around a lot from where he was even three years ago because he was raising rates aggressively three years ago, caused the December sell-off, the Christmas massacre, I call it. And it was a 20% decline. And I was like, Powell, you're going to kill this economy. And Yellen actually called him up and they had a talk. And I think.”

    2021-07-02 · We Study Billionaires · TIP357: The New Era of Investing w/ Ross Gerber · IDENTIFIED FROM THE TRANSCRIPT