Episode #455: Eugene Fama: A Life in Finance
Guest: Eugene F. Fama, 2013 Nobel laureate in economic sciences, is widely recognized as the “father of modern finance.” His research is well known in both the academic and investment communities. He is strongly identified with research on markets, particularly the efficient markets hypothesis.
Date Recorded: 10/12/2022 | Run-Time: 42:23
Summary: In today’s episode, we talk to Professor Fama about whether he thinks the Fed can control inflation, where the phrase efficient markets came from, and his take on the global market portfolio. As we wind down, we hear the last time he bought an individual stock.
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Links from the Episode:
- 0:38 – Sponsor: Masterworks
- 2:40 – Intro
- 3:14 – Welcome to our guest, Professor Eugene Fama
- 3:53 – Professor Fama’s take on the Fed & inflation (link)
- 8:04 – Insight on the origin of the 60/40 portfolio
- 9:26 – The inspiration that lead to his thesis on efficient markets
- 10:10 – Negative interest rates and how to live in a higher inflationary world
- 12:04 – The global market portfolio
- 15:58 – How much the collective earnings of his former students might amount to
- 17:27 – Why he’s never written anything on trend following
- 18:38 – Best practices to overcome the challenges of not mucking things up
- 24:02 – Topics and papers that never got the attention he feels they deserved
- 25:59 – The role ESG plays in the investing world today
33:28 – When was the last time he bought an individual stock
- 34:29 – His most memorable investment
- 35:08 – What’s on his mind as he looks towards the future
- 37:32 – All of Professor Fama’s papers
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