Chinese Engine Powers Global Growth

Featuring Tim Guinness

Equity market veteran Tim Guinness, takes us on a global tour of the valuation cycle, assessing the relative differentials between US, Asian and European stocks. Sharing his insight on China and what it can do for the global economy over the next two decades, Tim also discusses innovation and what to look for when selecting fast growing companies from a value perspective. Filmed on July 18, 2017, in London.

Published on
14 August, 2017
Topic
Technology, China
Duration
28 minutes
Asset class
Equities
Rating
171

Comments

  • JM

    James M.

    11 9 2017 09:36

    0       0

    Don't know where to start. I think these guys are extracted from reality. The middle class in the USA is getting crushed as they should for believing in Reaganomics bullshit. The populous get the government they deserve as Jefferson said. PRIVATE banks in Europe/USA LOL hahaha seriously. Perpetual growth on a finite planet in resources catastrophic decline, a market that is about as FREE as any former soviet centralized system, Environmental collapse globally , political corruption globally on a scale reminiscent of the Roman empire in the final stages of its collapse, etc etc etc etc blah blah blah I know we have heard it all before and I bore my fukin self sometimes. Lets go get on the same drug as this guy and all be happy lol fukkkk me lol.

  • sp

    shashwat p.

    31 8 2017 08:43

    0       0

    he should have talked more about how to manage the capital controls in China. Very bullish!

  • AC

    Andrew C.

    31 8 2017 03:26

    0       0

    @Tim: It's hard to see China going from 11K to 60K GDP/capita under the current political and economical regime; almost impossible, actually. Can you explain how this can occur?

  • CM

    Chris M.

    25 8 2017 15:46

    0       0

    Looks like his fund has matched market performance with more volatility: https://www.trustnet.com/managers/factsheet/tim-guinness/ima-utoeic/O/00000034AV/

  • sm

    stephane m.

    25 8 2017 10:29

    0       0

    My little girl broke her pink bike glass yesterday. Maybe he should too ;-)

  • AB

    AJ B.

    22 8 2017 18:26

    1       0

    Was the bank of Scandinavia in the 90's controlling the 2nd largest economy in the world, and the main trading partners with half the world? To compare it to China at the moment is a tough sell.

  • EG

    Eric G.

    20 8 2017 05:14

    2       0

    Be sure to bring him back in 6 months, 12 months, etc to revisit his thesis.

  • AE

    Alex E.

    19 8 2017 01:15

    5       1

    As has been stated elsewhere in this comment section, this guy's trying to blow smoke...1982 didn't have a World Debt level of $225 trillion dollars. It didn't have China with a 300% debt to GDP level. It didn't have the Euro zone printing 60 to 80 billion Euro a month. It didn't have the U.S. with a $20 trillion dollar deficit.
    The World population was young compared to the coming wave of retirees all over the World. When those retirees cash out, markets are going to go down, not up, so I really don't see this man's optimism. The selectivity of his research would make me cringe with respect to investing in his funds. I do not agree with him at all.

  • TS

    Tarang S.

    17 8 2017 20:23

    2       1

    Worst interview all year.

  • PS

    Paul S.

    16 8 2017 03:54

    3       0

    This guy sounds like a business development manager talking to financial planners

  • PD

    Peter D.

    15 8 2017 22:16

    5       0

    Nothing wrong with this type of presentation, despite the many weaknesses that were pointed out (its "advertorial" nature, the ludicrousness of removing financials & energy from CAPE calculations, the guy's past performance talk about one fund, in one period, ignoring all the other funds and discontinued funds he has been involved with etc....).
    Frankly, the priceless sceptical look on the interviewer's face, who politely stood back, and let this guy talk, told the whole story.

  • AH

    Andreas H.

    15 8 2017 18:30

    1       0

    The gentlemen has it all right :-) Great interview!

  • BG

    Bruno G.

    15 8 2017 18:19

    8       0

    My heart is warmed that so many down voted this discussion. Their is still some degree of sanity among investors

  • TR

    Thomas R.

    15 8 2017 14:29

    11       0

    I also appreciate hearing views that differ from my own. For me one of the biggest differences for the US Market between now and 1982 is in 1982 our debt to GDP was 34% rising off the 31% low it hit in 1981 from the post WWII former high of 119% in 1945. Our current debt to GDP domestically is approximately 107%. I don’t have the same comparison for debt levels in 1945 or 1982 worldwide. As we’ve heard numerous times the overall world debt to GPD is currently over 300%.
    The overall US Macro circumstances appear dramatically different, arguably opposite those that existed in 1982. Certainly it would seem that the US doesn’t have the same capability to double Debt to GDP like it did from 1982 to 1992 driving infrastructure and military spending. His statement that the US population is growing needs to have an asterisk by it to address current immigration policy which could be a deterrent to population growth.
    I would offer that a huge tailwind for the markets these last 35 years from 1982 has been overall interest rate declining and the huge bond bull market all of which generally appears to have ended. He did address interest rates in the presentation but did not address debt levels in his analysis.
    Going forward, in the world of probability, it’s hard to imagine anything but a headwind for the US equity markets with the levels of debt and inability to grow faster than deficit spending going forward. For US equity markets to rise over the next 10 years without a serious correction, it would seem that interest costs would need to remain low or flat line and the US debt continue to be monetized, despite occurrences’ of inflation along the way. The actual effect of rising rates to the US deficit lags based on debt maturities – much like turning a large ship. With a time horizon of at least 10 years, it’s hard not to imagine not having huge re-set similar to 2007-2009
    The growth of China’s middle class and being overweight China does make sense and China’s growth can drive world markets and likely will over the next 20 or 30 years. Their bank is government owned and does own their debt so that could play out in a manner similar to Japan.

  • JT

    Jan T.

    15 8 2017 08:29

    23       0

    The first part was slightly interesting. The second part really was a advertorial. i.e. Our fund is in this top list that top list. "We must be doing something good".

    In fact on that subject. At some stage I think the yearly subscription could go significant down IMO, as Realvision gets bigger the audience to which the guys here can pitch their funds and raise assets becomes highly lucrative. It’s a different concept. But for a guest to tell about how good his fund is, and that it invest in innovative companies provides hardly any value for a paying subscriber.

  • EB

    E B.

    14 8 2017 23:28

    23       2

    This interview doesn't belong on RV because he alludes to valuation measures that are POORLY CORRELATED WITH SUBSEQUENT RETURNS (forward PE sucks, CAPE is so-so). Using better correlated measures like Buffett's marketcap/gdp or Hussman's market cap/ GVA, we are wildly overvalued with record overvaluaton for the median stock. It's ok to have different outlooks (for example, someone argues government will intervene to save stocks, or inflation will render stocks attractive) but let's not debate the actual numbers. Math isn't subjective. This interview belongs on CNBC. And you've had a few other guests like him, btw.

  • RM

    Russell M.

    14 8 2017 22:15

    3       1

    I think it is correct to at least footnote that 2 out of 10 years of cape data are irregular samples.

  • SV

    Steven V.

    14 8 2017 19:19

    15       0

    Even though I disagree with his view, I appreciate that RV interviewed him. Many financial advisors have been selling their clients on the belief that the stock market is going to boom like it did after 1982. While I don't see that, it's nice to get an understanding of where this view is coming from.

  • DC

    Dan C.

    14 8 2017 19:16

    8       1

    Nice to see a counter argument against bear case but i think him somwhat deluded taking data out of the CAPE to curve fit his hypothesis.

  • DG

    Daniel G.

    14 8 2017 17:07

    5       1

    That exercise in CAPE projection 5 years forward is just bonkers. He may be right on market direction but I don't at all agree with his reasons why.

  • SH

    Steve H.

    14 8 2017 15:37

    5       1

    1982? The delusion... all economic figures are exactly the opposite of 1982.

    I so tire of the, "if you take all the bad stuff out of the numbers" argument.

  • dj

    daniel j.

    14 8 2017 15:08

    4       1

    He seems to be selling a value produvt in and overvalued marked?

  • TH

    Timo H.

    14 8 2017 14:43

    11       0

    This guy does not seem to worry too much about the totally distorted/destroyed credit market.

  • ot

    ognian t.

    14 8 2017 14:08

    28       1

    I have two points where I struggle with the logic of this presentation:
    1. CAPE is in the "red" zone, but if we remove 2 of the bad years, then it is just 19.2x. Isn't the point of CAPE rolling 10 year window to include good as well as bad years and average those? Not to mention that 19.2 is probably 20% above average.
    2. So if the 5 year forward looking CAPE may not be looking extremely hot (like 2000 hot) let's now remove the banking and the energy, which BTW are probably the only reasonable PE sectors and see what we get. Somehow we got acceptable US valuations comparable with the other DE markets.
    I am lost.

  • PU

    Peter U.

    14 8 2017 13:51

    11       0

    delusional

  • OT

    Oliver T.

    14 8 2017 13:32

    16       0

    some interesting parts but overall very floaty and full of data selection bias

  • TH

    Thomas H.

    14 8 2017 11:37

    5       0

    He initially compared this stock market to 1982.

  • PB

    Pieter B.

    14 8 2017 11:02

    7       0

    Very refreshing! I am one of those critical pundits on china/overvalued stocks and hence it is great to get opposing views. Thank you!