Jeremy Grantham, Susanna Palmer, Citigroup discussed on Masters in Business


Reporter in a Syriza tweets. Press secretary Jen Psaki says Duck Low, has apologized to the political reporter in center, a personal note expressing his profound regret when he returns, Duck low will no longer be assigned to work with any reporters. A politico Don't miss it terribly. And I'm Susanna Palmer in the Bloomberg newsroom calls are coming in from state Republicans for Governor Andrew Cuomo's resignation This after Cuomo's top aide told Democratic lawmakers in a virtual meeting this week that the administration withheld nursing homes. Covert 19 death toll to avoid a federal investigation. Secretary to the governor, Melissa de Rosa, said that the state rebuffed in August legislative request for the tally. Ah, partial transcript of the meeting was released by the governor's office yesterday, Cuomo was facing increasing criticism for alleged intentional undercounting of nursing home deaths from covert 19. Proposal in governor Cuomo's budget would make spitting and other forms of aggravated harassment against transit workers punishable by up to one year behind bars. More from Bloomberg's Dinis Pellegrini, a coalition of transit worker union says empty a bus, subway and commuter railroad workers were spat on more than 200 times last year. The governor's proposal will do away with the standard that requires AH police officer has to witness an incident of aggravated harassment before an arrest could be made. It would allow officers to investigate based on an incident report that a transit worker files instead. Nisa Pelligrini Bloomberg Radio. Bank of America and Citigroup trimmed compensation for their chief executive officers last year. Filings show Bank of America cut CEO Brian Moynihan's paid by 7.5% down to 24 a half million and Citigroup. Curbed compensation for outgoing CEO Michael Corvette by 21% down to 19 million. Both lenders cited the impact of the pandemic and considering the compensation levels. Czech gun maker announced an agreement to acquire the parent company of Colts Manufacturing the iconic brand, based in West Hartford, Connecticut, whose revolver one the West in American Lord. Global. He was 24 hours a day on air and on Bloomberg. Quick take powered by more than 2700, journalists and analysts in more than 120 countries. I'm Susanna Palmer, This is Bloomberg. This is master's in business with very rich hold on Bloomberg Radio. My special guest this week has been anchor he is GM owes Head of asset allocation during the dot com implosion, the GMO aggressive, long short strategy. Which was long, undervalued Stocks and short, overvalued stocks achieved an 80% human of net return for clients. The farm is led by Jeremy Grantham and currently manages about $60 billion. Then incur. Welcome to Bloomberg. Well, thanks very much for having me bury. So your current role is head of Deimos Asset Allocation team. How did you arrive at that position? Tell us a little bit about your career path. Well, I have been at G M O for the entirety of my professional career. I joined GMO in 1992. I was hired as a research analyst working for Jeremy Grantham. Um And since Jeremy was the person who was kind of most focused on pop down asset allocation stuff that GMO well, I did a lot of different kinds of research over the first. No. Later 10 years of my career, I was The person who had done the most work on acid allocation that our Business in acid allocation grew. I wa so you know his assistant portfolio manager and then the portfolio manager and then over time, the head of the team. That's the short form interesting. So you started early nineties, which was quite an interesting decade to cut your teeth on. How did your early experiences During that era shape your views off the market. One of the things I got early on was this, um And strong understanding and belief that markets can do crazy things, but over time they do. Eventually come back whether that's because they have gotten absurdly cheaper. Certainly expensive, You know, I then got to participate in the next great bubble, which was quite painful for us as investors. But then, you know, got to experience Just how crazy uh The world could get s so it was a fascinating kind of crucible. Torto grow up in as an investor. So you say that was painful, but in the ends Ultimately, the firm and Grantham's calls ended up being right. It was a big money maker. To the downside. Does that offset the pain? What do we take away from? When markets go crazy, but ultimately, you know, as always, that sort of excess ends in tears. Yeah, I think you know it is. It is truly the case. Um That, uh You know the market in the short term, maybe a voting machine but in the long term is a weighing machine on at the end of the day. A to least for assets that were valuation is Relevant on. It is astonishing that we live in a world where there are more assets where valuation is is not a relevant thing anymore, but for the vast majority of financial assets out there We're about valuation is relevant valuation will eventually out. Um you know, at the end of the day, everything is worth the present value of the future Cash float. And what we have seen time and time again is the market will forget that. On and as the market forgets that it will do some Of objectively silly things. But in the end, um those cash flows or the lack of them is a Profound the discipline to the market, which will pull things back now. The timeframe that they're going to pull them back over is uncertain. Um, and one of the things you know we we lived in in the late nineties events. Eyes that while in the end the collapse of that bubble Woz positive for us. It was positive for our clients because we did manage to make the money for it. And helped GMO grow as a business. The reality is there were a number of other Money managers that saw what we saw and did some of the things we did, and for whatever reason, couldn't hold off. So you write very thoughtful, quarterly or so letters that I enjoy. Couple quarters ago, you had explains as some of the tech stocks keep rallying is some of the valuations continue to stretch. No one could really guess where this ends. But the most likely ends will be when the Fed starts to tighten and raise rates. First time I am I oversimplifying that or is that more or less right? And do you still hold that sort of belief? You know, it is not. It won't surprise you at all to hear that The most common question I am.

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