From Investment Banker to CIO with Mike Wilson

25:52But anyways, we can leave that where it is. And I guess this is where I come out in the story, which is I don't think that they've extinguished the risk of a hard landing. OK, because now we're going into a period where probably fiscal support is going to have to wane. We have an election, obviously, that could affect that, too. and also a policy now from the Fed may be late and forthcoming. We don't know the answer yet. So I think it's almost like a mirror image of last year. Everybody was so certain it was going to be a recession. And, of course, the majority was wrong. Now everybody's so certain it's going to be a soft landing.

26:22Who's to say that they're not going to be wrong? They just don't know. So I think that's where I come out on the market overall. The index level, we're not as bullish as others because we don't think the multiples reflect that there's still this risk that's probably 20%, 30 % at least. You could end up in a hard landing at some point in the next 12 months. And that's definitely not priced. So you bring something up that I'm fascinated by, and it plays right to the economists getting the recession wrong in 23 and 24, and that's your focus on government, both fiscal and monetary support for the economy.

26:57When we have a year like 2020, like the pandemic, when the CARES Act, and there were three CARES Act, but the first CARES Act was something like 10 % of GDP. We hadn't seen anything like that since World War II. Shouldn't that force people to kind of rethink their models when suddenly a few trillion dollars unexpectedly is going to pour into the economy? I remember Jeremy Siegel jumping up and down, a professor at Wharton saying, this is going to cause inflation, and nobody paid him any attention. Back in 2020, shouldn't that government support that you're referring to force us to kind of rethink our models a little bit?

27:36And we did. And that's why we got 2020-21 so right, because we agreed with Professor Singel in April of 2020. We said, look out for the inflation. And people thought we were nuts. They were in recession. Right. The pushback was pretty fierce today. Fierce. We got more pushback, by the way, being bullish in March and April of 2020 than being bearish in 2022, because people said we were being insensitive to the disease. And we're not being insensitive. We're just trying to do our job. And anyways, the point is that that boom bust, We compared exactly to World War II. We wrote extensively about this.

28:06The way we adjusted it was we said, okay, these cycles now are going to be hotter but shorter. And that's why in 2021, we said, okay, this is the peak of the cycle, rate of change, which, by the way, turned out to be really accurate. We got people out of all the high-flying meme stocks and all that, like in March of 21, because we said, this is silly. This is all just COVID overconsumption. It's going to be payback. So we did adjust all that. But once again, Barry, you can't get everything right. That's right. So we feel like that narrative is still right on track. We didn't trade it particularly well.

28:39Now, what we did trade well was our defensiveness and our quality bid, staying away from small caps. We got out of the memes, the high-flying multiple stocks. People tried to keep buying those and just got carried out. And what I find interesting is if you're bearish and wrong, you get carried out. And people just hate that. But the reality is that if you're bullish and wrong, you destroy way more capital if you're telling people to buy these crazy things that have no valuation support. So it's just kind of ironic. And I'll just throw this out as a bit of an advertisement. But we run a portfolio of 10 stocks, a concentrated portfolio.

29:1610 stocks. 10 stocks. Wow. And so the last six and a half years, that portfolio has outperformed the S &P by almost 800 basis points annually. Wow. Annually. That's huge. With very little drawdowns. And we've been underway at the MAG-7 by like 90%. No kidding. I immediately assumed it was all MAG-7. No, because MAG-7 killed you in 22, right? Right. That's right. So in 22, that portfolio was actually up. No kidding. And it's long only. So now what I'm saying is that calling the S &P 500 is not really that important to making money. Right. Making money is pivoting into things that maybe are unloved, getting out of things that are overloved at the right time and not overstaying your welcome.

29:56And that's where I think our research and our advice has been really quite good. So here's what I'm kind of intrigued by. You have all these different roles. You're looking at all these different aspects of the market, of the economy, of various government policies. How do you take that mass of information and communicate it to both the Morgan Stanley staff, the sales team, the brokers, the asset managers, and the investing public. I know you do a weekly podcast on your perspective of the market. How do you get all of this information to your audience on a timely basis? Yeah, it's a challenge.

30:39I would say of all the things, all the skills that I've acquired over the years, probably my best skill is communication, whether it's verbal, written, media of some kind. People say I have a face for radio. Me too. Yeah, the podcast is better. But the point is I'm pretty clear. There's not really any uncertainty about what I'm saying. I could be wrong, but it's very clear. And people like the clarity of the messaging. So we write a note every week. There's a cadence to it. We've developed this cadence with our clients every Monday at 12 a.m. in the morning. The note comes out. So people are waiting for that.

31:17Or we do these regular touch points. And that regular communication, whether it's to the institutional community, to the retail community, to our endowment community, whatever that might be. And of course, then we do a lot of marketing. We do a lot of one-on-one meetings, group events, et cetera. So it's all those touch points. And the challenge is that we have to deliver the message depending on who the audience is. When it becomes challenging is if I'm doing a media segment and that maybe the messaging is more for the institutional community, but then the retail community picks up on it and it's really not for them or vice versa.

31:53That's where it becomes a bit of a challenge. And that's one of the reasons why I'm now more focused on the institutional side. Do you ever find yourself, when you're putting these weekly conversations together, looking at the flow and saying, you know, most of the time these data series are just trending, and it's when either there's a major reversal or a big outlier that it's interesting, but all right, it's consistent with last month's trend and the previous month's trend. Do you look at that stuff and say, we don't really need to talk about ISM again, do we? Or how do you deal with that? Well, I mean, it comes down to what we think is the most important thing this week.

32:29We also, you know, it's a bit of an art in terms of, okay, when do you press it? When do you lay low? When do you make a relative value call? When do you make a market call? You know, it's like, well, where's the opportunity right now? We can kind of go anywhere. The beauty of my job is I can kind of talk about anything. I can talk about rates. I can talk about credit. I can talk about stocks. So that gives me a wide range of things that I can have something relevant to say every week. Really, really interesting. So there's a phrase of yours that you use that I'm fascinated by. It's almost a wartime phrase.

33:01You had written, the fog of uncertainty reveals new investment opportunities. Explain. Well, that's when things are mispriced the most, right? When things are certain, you tend to get pretty accurate pricing. And of course, that's dangerous too. I was going to say, sometimes you get certainty in the wrong direction. Correct. But when things are really confusing, like during COVID, for example, you had incredible value opportunities that popped up because nobody knew anything, including us. But we knew the price. And that was the main reason we got bullish in March of 2020 was that we were waiting for equity risk premiums to blow out, and they did.

33:38And I'm like, well, it doesn't really matter what happens. If I'm buying this at a 700 basis point equity risk premium, I'm going to make money. I'm going to make money, maybe not next week. Now, it turned out it was actually the low. But, I mean, that's when valuation typically doesn't matter. But when it matters, it's all that matters. And the fog of uncertainty creates those mismatches. By the way, it creates on the upside, too. So, for example, in early 2021, we made a pretty important call, which was that all the meme stocks were going bananas, right? Because the free money that was floating around, like, well, these prices are – this is not going to end well.

34:12And it sure – it didn't. Right. Never does. It never does. Right. Right. How is the fog of uncertainty today? It's clearly not March 2020, but there is a sense that people have no idea which direction we're going to head. I would say that right now there is more certainty in people's minds than reality. And that's really where the opportunity comes up, which is meaning there seems to be a lot of certainty about how things are going to play out, not economically, but also from an earnings standpoint. But I've heard these same arguments now for four to six months, four to six quarters, quite frankly, about this reacceleration in certain things, which it keeps being deferred.

34:53There's also a lot of certainty apparently around Fed policy because they guide, which I don't think there's any certainty around. They don't know. I mean, the street has, let's be blunt, been dead wrong about what the Fed was going to do. It feels like it's a year and a half already. The Fed has been wrong. It's a hard job. I mean, I remember, I'll just go back to an example. but in December 2021, there was 50 basis points of Fed hikes priced in to the next year. And I remember talking to clients going, like, do you think this makes sense? I mean, we're at runaway inflation, and the Fed has told you they're going to start raising rates.

35:28And they're like, well, yeah, it could be more, but that's what the Fed's telling us. Oh, OK. Well, I mean, so I find that this goes back to 2003 with Regulation FD. That's when everything kind of changed. Well, it changed in two ways. So the Fed changed with Greenspan, right, with all this forward guidance. And then, of course, it's just gotten more and more and more. You've got a dot plot now. It's just compounded. You give people a little bit of information, they want more. So the Fed now provides so much information, they can't even tie their shoes without telling us first. To be fair, when you and I first started, the Fed didn't even announce they were tightening.

36:05You would just see activity in the bond market. Exactly. And someone would say, hey, it looks like the Fed raised rates. Now, not only do they tell us they're raising rates, we get the transcript from the meetings. And then they have to basically go through every line and they're like parsing each word. It's gotten to the point now where it's almost debilitating, okay? Because the markets are almost unable to trade away from this sort of formal guidance. Now, that served a purpose to a point. Now, I think it's outgrown its usefulness in many ways, okay? Does the Fed lose something by giving up the elements of surprise, the ability to shock the markets?

36:40I think so. But more importantly, what ends up happening is the market now gravitates to pricing in the same outcome. No one is willing to go away from the dot plot. The market rarely gets away from the guidance. And I bring that up because it's the same thing in the stock market now. With Regulation FD, and now we have an entire industry dedicated to company conference calls. So if you look at the variance in analysts' estimates, it has absolutely narrowed dramatically over the last 15 or 20 years. In the mid or late 90s, when hedge funds became a thing and active managers were doing their thing, the variance in estimates was all over the place because we didn't have this such formal guidance.

37:26And so the irony here is that in the effort to reduce uncertainty, you actually end up creating more volatility because invariably those estimates are going to end up being wrong at some point. And everybody's in the same position. Really interesting. So you mentioned earlier your focus on cycles, not just economic cycles and business cycles, but market cycles. Tell a little bit about where are we in the economic cycle and where are we in the market cycle today? So we're pretty convinced that we're late cycle. Now, late cycle periods can last for years. I mean, the late 90s is a great example of that.

38:02I mean, it went on forever. And so we don't know when it ends, but it's very hard to argue that we're mid cycle or early cycle because we're unemployment is. I mean, you're basically at the 50-year low and it's kind of turning up. So we think we're pretty much late cycle. And that informs us where to be within the markets. That's why quality large caps have done so well, quality growth in particular. That's what works. And this idea that you're going to go back to small caps or low-quality cyclical, it doesn't work. But people, I don't think, understand or appreciate where we are, or they have a different view about where we are in the economic cycle.

38:33So that's one example. On the price cycle or market cycles, I mean, that tends to be around kind of Fed policy, kind of where the interest rate cycle is. Well, there, too, it would suggest that we're late cycle because the curve has been inverted for two years. We're now about to re-steepen and go positive again. And that also would argue that you want to have your risk kind of dialed back, at least from a beta standpoint. You don't want to be invested in lower quality balance sheet businesses. Credit tends to do much better than equities. That has been the case on a risk-adjusted basis. Bonds tend to be a better buy.

39:06That's starting to work now. So, yeah, I mean, there's all kinds of things that we look at. And then, of course, there's individual stock cycles, which we pay attention to quite a bit. So we do use a lot of technical analysis. One of the reasons we're contraining is I tend to fade. I fade exhaustion. Exhaustion meaning things get overbought or things get oversold. I like to kind of press into those points. That's really kind of interesting. So you mentioned the inverted yield curve, and now that's disinverting and starting to steepen. Everybody tends to focus on the inversion, but that's not where recessions occur.

39:41It's after the yield curve inversion unwinds and things begin to steepen. So what are your thoughts on the possibility of a recession in 2024 or more likely 2025? Well, once again, our house call is that it's soft landing's most likely outcome. We don't have an answer. And I don't think the curve is re-steepened in a way that would signal that recession is more likely than not yet. But that can change. So we're very focused on that. And usually when the curve re-steepens from the front end, meaning the Fed is catching up, This is why I'm very focused right now on the two-year yield relative to Fed funds.

40:17So two-year yields got almost 185 basis points below Fed funds. You would think is anticipating massive cuts, like not 50 basis points or 75. It's predicting 185 basis points of cuts over the next probably 12 to 18 months, which is a pretty aggressive Fed cutting cycle. And that's all it's telling you. It's just telling you that the likelihood that the Fed is behind the curve has gone up. Once again, not a recession. But the risk of a hard landing has gone up all else equal. If the market thinks we're getting almost 200 basis points in cuts, it sounds like the bond market is anticipating a recession.

40:55Right. Now, the good news is that has narrowed. So the spread now between two years and Fed funds is down to 145. Why? Because the claims numbers were better. We got some ISM services data was a little bit better. So this fear that got priced in really quickly is now subsided a bit. It doesn't mean it's extinguished. It just means that the pendulum is swinging back again. And so we're focused on that. We're watching it closely. I would say the jury is out. We don't know. So markets in 2024 had a great first half of a year. A lot of people expected to build on that 10%, 12%, 14 % gains, depending on which markets you were looking at.

41:34You've come out and said, I think it's a low probability that there's a whole lot more upside for the rest of the year. Tell us what you're looking at there and why do you think, hey, most of the gains for 2024 have already been had. So all of the gains really since October of last fall has been multiple expansion in anticipation of a Fed cutting cycle and a reacceleration in growth. So we went from 17 times earnings, S &P earnings, in October of last fall to 22 times earnings in June. Well, that's about as rich as you can get. So I'm pretty comfortable saying that multiples are likely to come down as the Fed cuts.

42:13That's also something I think people don't appreciate. Once the Fed, like, it's easier to travel than arrive. So as you're moving to the Fed cuts, that's the best part of the cycle. We wrote about that at the end of last year when we sort of, you know, threw in the towel that we were going to have this, you know, hard landing. We thought there'd be a rally. OK, we didn't think we'd go to 5 ,700, but needless to say, that's what happened. But the best part of that rally has now occurred. So when the Fed starts cutting, multiples usually go down. And there's just not enough earnings growth to offset a 10 % to 15 % multiple contraction between here and the end of the year.

42:47We have like 8 % growth built in for next year's earnings growth. So that's the math. I mean, you have a net drag from the multiple contraction relative to what the earnings growth is going to be, even in the soft landing outcome. So I would argue that the highs for the year in the S &P are probably in. That doesn't mean it's a cataclysm. It just means that the risk-reward now is not particularly attractive. So you have this very nuanced take that I'm intrigued by. What you're describing is somewhat cautious. However, the nuance is pullbacks are opportunities for investors to put money into high-quality growth companies that have strong financials and high earnings potential.

43:29That's a very nuanced position relative to the highs are in for the year and we should expect a bumpy road from here. Well, it's a little bit of both. I mean, I would say that I think the trajectory is down. I mean, 19 times next year's numbers, which would be the end of the year, is lower than what we're trading today. It's sort of that low 5 ,000 as opposed to 5 ,400. But what is that, 5, 6 %? That's not exactly end of the world. It's bumpy. It's bumpy. That's the way you phrase the question. I think it is going to be bumpy. Let's not forget that we're going into this election season. There are some other things going on around the world.

44:05There is still excess leverage in the system. I'm not sure how that's going to be resolved necessarily. China is not providing the impetus that people were hoping for from a growth standpoint. We need to take a little bit of a break. It could just be a consolidation period at the index level, which once again lends me to say I want to be up the quality curve, And I want to skew more defensive than growth because that's typically what works when the Fed cuts. Let's talk about another nuanced position that you have that I find fascinating. Everybody's been so focused on the artificial intelligence enablers, NVIDIA, and all the other semiconductor chip companies.

44:44but you've made the argument that investors should begin to shift from those AI enablers to the AI adopters as the big next opportunity. Talk about that because that's really a fascinating concept. Yeah, I mean, that's sort of my technology background speaking. I mean, that's how these cycles work. You buy the picks and shovels or the enablers initially, and then the real money, the real opportunity is with the companies that can actually deploy that technology into a new business model. So if you think about the 1990s as a good example, everybody will understand. The enablers were the telecom companies, the silicon companies, the telecom equipment companies.

45:22Cisco, JDS Uniface, all these companies that nobody really, the average investor had no idea what their hardware was really doing. Right. But these were spectacular stocks. And that was in the build out of the internet itself. But if you think about who actually ended up building the big stocks, the ones that really worked from the internet, it's the MAG-7. I mean, one semi-country company that has gone crazy here recently. But generally, these are the businesses that took the internet and then built incredible business models kind of for free. I mean, they didn't have to spend the money to build the superhighway.

45:58The guys who built the superhighway, those stocks have been terrible. Well, Metromedia Fiber and Global Crossing, they spent thousands of dollars a mile and then got sold for pennies on the dollar. But that's how you end up with YouTube and Facebook and Netflix. So that's why it's interesting now, Barry, where, you know, so obviously the hyperscalers have been the big winners of the last era. And there's nothing wrong with these businesses or companies. OK, they're great. But they're now the ones spending all the money on this next generation cloud or AI, whatever you want to call it. By the way, AI, just to be clear, is really just an extension of machine learning.

46:32I'm not sure we're going to have really artificial intelligence. I mean, that's an interesting way to get people excited. It's just another investment cycle. There will be use cases in business models that are very profitable built on the backbone of those cloud networks. Okay, great. We don't even know who those companies are yet. My guess is they're going to reside in areas where great efficiencies are needed, for example, in health care, which we were talking about earlier. Right. Like a lot of inefficiencies in health care. Well, you know, somebody's going to come up with a solution to kind of wring out that inefficiency.

47:02OK. And there's massive opportunity for that using machine learning. I don't know who those companies are yet. OK. But those are going to be really the fat pitch. That's going to be where the real wealth at the 10, 20, 30 baggers, because these companies now they can't grow tenfold. They're they they're already too big. You know what I'm saying? It's amazing when you look in the health care space, they still use fax machines. I mean, literally have your doctor fax the prescription to the, why can't you do email? It's not secure. Some of this is technology. Some of this is just, you know, having one focused business methodology that seems to not be rooted 2034.

47:47What is fax machine? 40 years old? It's amazing. So it's not so much AI as just a rapid adoption of better technologies and AI helps. How do we conceptualize that? It's just faster processing, right? And then once again, it's about the solution that it's built around that, right? The internet was a really interesting development. But I mean, 1995, and you remember this like I did, you know, we're sitting around in the desk and all of a sudden they're like, oh, there's this thing called email that we're going to introduce. Like, what is this? But it was such an easy application. Don't email clients.

48:21You have to get compliance to approve that. Not yet. Do you recall back in the day where you literally had to have approval to send emails? It's amazing that that adoption period was a decade plus long. But it was fast. It was pretty immediate. And anybody could type, could use email. And email was, I think, still to this day, one of the biggest productivity enhancements I've ever seen in my lifetime. Now, the browser was the other killer app. and now the problem is there weren't any websites to go to for a while. But those two sort of apps to me were so obvious, much more obvious than, say, ChatGPT is, at least so far.

49:00We'll see where that goes. Right now it does homework for high school students and can help you and I write a nice poem to a loved one or help us write a speech or something great. But is it really enhancing productivity in a meaningful way? We can't use that yet. We can't trust it for the numbers. We can't trust it for mission-critical type analysis yet. Right. It's a research addendum, but it still hallucinates. And so my favorite story is I had Bill Dudley, the New York Fed, in as a guest, and I used ChatGBT just to see if I missed anything. And thanks to ChatGBT, I learned that he was a linebacker for the Detroit Lions in the 1950s, which is kind of interesting because he was also born in the 1950s.

49:47ChatGBT couldn't figure out two different William Dudleys. That'll eventually get worked out. At what point, and this goes right back to your AI adopters, look, we're all internet companies, we're all phone companies, we use all these technologies. At what point in the future do the other 490 companies in the S &P 500, not the AI enablers, but the adopters, when do they start to see the productivity benefits from AI. How far off is that in the future? When the hyperscalers or somebody else hands them a solution, it's a package solution. I mean, it's no different than software in the 90s, right?

50:25It's not like you and I were going to go develop Office or we're going to go develop Excel. But somebody developed that for us. We deployed it in our enterprise and our employees became very productive. So we just need the development of those applications. That's the second phase. The other problem that we haven't solved yet is the electricity, the power consumption, the heat, and also to build these things out, it takes time. And so there are some snafus in here that will retard the expansion and growth of - But all those things are solvable. Of course they are. It's just a matter of - Time.

51:00But is it decades or is it years? Oh, no, it's years. But I don't think it's fast enough to prevent where we are in the economic cycle. Once again, going back to, I think there are people making the argument that, oh, not only did the fiscal kind of bridge us another year, but now AI is going to extend the cycle another three or four years. I'm just not in that belief. That's the next cycle. That's the next cycle. That's what you're going to want to get excited about when valuations come in at some point in the next 12 months, is my guess. And there's a fat pitch that people have forgotten about.

51:37All right. Last of our standard questions. when you look at a market where we are today, when you look at an economy where we are today, what are your favorite metrics to focus on, whether it's valuation or the economy or inflation? What are your big three that you're watching? So once again, it goes back to rate of change and a lot of the key metrics. I say the key metrics I'm focused on now are things like revision factors, so earnings revision factors. That's what stocks are most highly correlated to. That's now rolling over. So the rate of change on is in a bad slope, which means valuations come down.

52:11It doesn't mean it has to go to negative, but it can go negative and then we'll have to adjust our targets further. Right now, it's in a correction phase from a finance standpoint. From an economic standpoint, it's all the labor data. That's all that matters to me now. Everything else is kind of secondary. If the claims data and the payroll data stays okay, soft landing is the outcome. If that deteriorates further, I don't think it can deteriorate a whole lot further before the markets start to get nervous. In our last five minutes, let's jump to our favorite questions that we ask all our guests, and we'll do this in a speed round.

52:45Starting with, tell us what you're streaming. What's keeping you entertained these days? Yeah, I'm watching sort of an eclectic group now. The Bear, I don't know if you've seen that show. We just finished season three, which I didn't love season three as much. Season two is still better, but three was interesting. Yeah, it's all It's just great character studies, which we enjoy. My wife and I have enjoyed that series. We just finished it. Other than that, The Offer, if you've seen that? No. So The Offer is about the making of the movie The Godfather. We were just talking about this over the weekend.

53:16Spectacular. We're not done with that yet. Because I can't remember the last time I saw Godfather 2. It had to be decades ago. And someone said, watch The Offer. It's based on the book that the producer did. did and people said when you go back and re-watch it everything has different context it's spectacular so i would recommend that and then i'm watching a pete rose documentary right now i'm in the third of the fourth uh and it was not what i expected so i like to watch a lot of documentaries and that one is pretty fascinating really interesting tell us about your mentors who helped shape your career well i mean this is i don't know if this is going to sound right or dishonest, but it's true.

53:54It's basically my mom and my wife. I mean, these are the two strongest women I've ever met in my life. They've been extremely honest with me and forced me to grow. And so those are the two most important for sure. There's no one person, but many colleagues and many clients. I would say clients have shaped my views on the markets probably more than colleagues because they're actually putting skin in the game. And they've also helped me make good career decisions and judgments. It's such an interesting observation you're making because we sort of forget how clients force us to rethink certain things.

54:34Or someone asked you a question where you think the answer is obvious, but you don't want to just give them a quick answer. So you do the homework and you discover, oh, this is a lot more complicated than I originally thought. I'm glad you brought that up because it comes up so frequently. And I think we don't pay it enough attention. It's really insightful. Let's talk about books. What are some of your favorites? What are you reading right now? You know, if it was up to my wife, I'd be reading like a book a week. She's a literary giant, so she's always handing me books. And I'm kind of an eclectic reader.

55:06But I would say some of my favorite books are The Boys in the Boat. New series now also, right? Yeah, there's a movie. I didn't watch the movie because the book was just so detailed it was fantastic of like all the classic books my favorite was catcher in the rye it's kind of a coming of age story um you know uh animal farm and those types of things and then like the the trashy type stuff you know like one of my favorites of all time still to this day is the firm i don't know if you remember reading the john grisham novel it became a tom cruise movie yeah but i mean like so like you know that's it's the gamut of it right now um i mean i read i read so much for work that I don't probably read enough books day to day, but I'd like to read more.

55:48Really interesting. Our final two questions. What sort of advice would you give to a recent college grad interested in a career in investing? Well, the advice I do give them is just, this is not a sexy business. This is a grinder business. So if you come into this business, understand, like we talked earlier, you're going to be wrong a lot. You got to have some humility. You're going to be a lot of highs and lows. When things are feeling really good, take it down a notch. When things are feeling really horrible, don't kill yourself. And it's just, it's going to be a roller coaster. And it takes a long time to become even close to being a domain expert in anything in this business.

56:34There's so many smart people. There's so much changing all the time. you know you got to put 10 years in before you know anything and i think that you know i think that's really good advice to a young person i wish i had had that advice because you know we're all ball-eyed coming out of college thinking we're going to change the world and the reality is this is a this is a long road i mean 35 years i'm still learning every day really interesting answer and our final question what do you know about the world of investing today you wish you knew back in 1989 when you were first getting started? Well, I guess part of it is what I just said.

57:07It's not a sprint. It's a marathon. Cut yourself some slack along the way. You're going to make some wrong turns. And I would say enjoy it because it's a journey. And it's a journey not just about the people you're working with and the people you're helping your clients. It's a journey about yourself. This is a struggle with yourself. I mean, figuring out markets is an internal battle. It's like probably the book I should have mentioned was Reminiscences of a Stock Operator. Sure. I mean, I read that like five times. And I still go back and refer to it sometimes. I call that the first behavioral economics book.

57:47I would agree. And it's a fictional character, but it's a real life experience of just how it goes down and understanding your faults, your own fault, understanding your weaknesses and your strengths, you know, when to press it, when not to press it. And then, and then, you know, unfortunately, that story ends up with, you know, killing himself because it just, it eats away at you. So that's, that's really what I wish I'd known 30 years ago. Like it's gonna, it's gonna take a pound of flesh. Right. Really interesting. Mike, thank you for being so generous with your time. We have been speaking with Mike Wilson, chief U.S.

58:23equity strategist and chief investment officer of Morgan Stanley. If you enjoy this conversation, check out any of the 500 or so we've done over the past 10 years. You can find those at iTunes, Spotify, YouTube, wherever you find your favorite podcast. And check out my new podcast, At The Money, short 10-minute conversations with experts about everything that affects you and your money, earning it, spending it, and most importantly, investing it. Add the money in the Masters in Business podcast feed. I would be remiss if I did not thank the crack team that helps us put these conversations together each week.

59:03John Wasserman is my audio engineer. Atika Valbron is my project manager. Anna Luke is my producer. Sean Russo is my researcher. Sage Bauman is the head of podcasts at Bloomberg. I'm Barry Ritteltz. You've been listening to Masters in Business on Bloomberg Radio.