Roger Ibbotson: Why Isn’t Everyone Rich When the Math Is This Simple? | #651

Today’s guest is Roger Ibbotson, a finance professor at Yale for four decades and founder of Ibbotson Associates. In today’s episode, Roger shares a century of stock and bond data and how one dollar became fifteen thousand in large caps over a hundred years. He explains why most people never capture those returns, and why total returns went unmeasured for decades. To close, Roger makes the case for young investors owning nothing but stocks and forecasts the next twenty five years. (0:00) Introduction of Roger Ibbotson (1:34) Overview of "Centuries of Stock and Bond Returns" (5:15) The challenges of market timing (10:19) Market cycles, risk, and the role of human capital for young investors (12:30) Historical bond yields, probability of ruin, and small caps vs. long bonds (19:13) Investor preferences and historical market forecasts (23:41) Nominal vs. real returns, inflation, and bond yields (29:17) Valuation metrics, market anomalies, and long-term outlook (33:15) Buybacks vs. dividends and private company valuations (37:12) IPO trends ----- Sponsors:⁠ ⁠⁠⁠ ⁠Farmland LP⁠⁠ is one of the largest investment funds in the US focused on converting chemical-based conventional farmland to organic, sustainably-managed farmland using a value-add commercial real estate strategy in the agriculture sector. ⁠Upwork⁠⁠⁠ is the world's largest human and AI-powered freelance marketplace to hire top talent—trusted by businesses and professionals worldwide. ----- Follow Meb on⁠ X⁠,⁠ LinkedIn⁠ and⁠ YouTube For detailed show notes, click here To learn more about our funds and follow us, subscribe to our mailing list or visit us at cambriainvestments.com ----- Follow The Idea Farm: X | LinkedIn | Instagram | TikTok ----- Interested in sponsoring the show? Email us at Feedback@TheMebFaberShow.com ----- Past guests include Ed Thorp, Richard Thaler, Jeremy Grantham, Joel Greenblatt, Campbell Harvey, Ivy Zelman, Kathryn Kaminski, Jason Calacanis, Whitney Baker, Aswath Damodaran, Howard Marks, Tom Barton, and many more.  ----- Meb's invested in some awesome startups that have passed along discounts to our listeners. Check them out here!  ----- Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).