The Long View – "Best of The Long View 2025: Investing"

Podcast: The Long View
Hosts: Christine Benz, Dan Lefkovitz, Amy C. Arnott
Release Date: December 23, 2025

Episode Overview

This "Best of 2025" episode assembles the most insightful clips from the year's Long View interviews with influential figures across portfolio management, economics, and investment research. The central theme is "expanding your investing horizons"—focusing on global diversification, transformative technologies, private markets, valuation, and the enduring principles of long-term investing. Each segment brings a distinct perspective on how investors should balance risk, seek opportunity, and avoid common pitfalls in a changing economic landscape.

Key Discussion Points & Insights

1. Global Diversification & Emerging Markets

Guest: Hendrik du Toit, 91 (00:53–07:56)

• Cycle of Outperformance: Emerging markets can outperform developed markets over certain cycles. Recent U.S. "exceptionalism" and a strong dollar environment have overshadowed opportunities abroad, but investors should diversify regionally.
  • Quote:

    "If you're a global investor and a very long-term investor, you've got to access all the sources of return or as many as possible, if the price is right... then your portfolio is more diversified." (Hendrik du Toit, 02:06)

• Valuation and Risk Premium: Emerging market debt offers higher yields versus developed markets. Investors can benefit if they select opportunities where the risk is properly priced.
• Broader Universe: The size and economic heft of countries like China, India, Brazil, and Mexico magnifies the case for emerging markets today.
• Recent Examples: Success in Argentinian debt for those willing to endure volatility; setbacks in Brazil due to diverging policies.

2. International Equities vs. U.S. – Valuation Lens

Guest: Cliff Asness, AQR (07:56–12:27)

• Historical Outperformance Paradox: Most of the U.S. equity market’s outperformance over the past 25 years stems from valuation multiple expansion, not superior earnings growth.
  • Quote:

    "Call it 80, 85% of the US's victory has come from multiple expansions… That has driven again the lion's share of US outperformance." (Cliff Asness, 09:30)

• Diversification Logic: Betting that the U.S. will repeat this outperformance is relying on unsustainable further multiple expansion; global diversification is a more prudent long-term strategy.

3. European Markets: Structural Shifts

Guest: Vincent Montemaggiore, Fidelity Overseas Fund (12:27–18:53)

• Rotation Out of U.S.: Recent flows into Europe fueled by crowding and higher valuations in the U.S.
• Policy Shift in Europe: Germany and other countries are moving away from austerity, increasing infrastructure and defense spending, which benefits banks, insurance companies, and defense stocks.
  • Quote:

    "The US is having some fiscal austerity… And Europe or Germany… are now going the other way… That is positive for European growth." (Vincent Montemaggiore, 14:38)

• Rates Likely Higher for Longer: Structural changes may benefit traditionally underappreciated sectors.

4. Is China Uninvestable?

Guest: Louis-Vincent Gave (18:53–22:03)

• Sentiment Shifts: Despite recent market strength, global investors remain bearish on China—sometimes the best time for contrarian positioning.
  • Quote:

    "Most people I meet with still believe China is uninvestable… Just in time for Chinese equity markets to start rallying and to start outperforming all others." (Louis-Vincent Gave, 20:03)

• Cyclical Investor Behavior: When the prevailing narrative turns overwhelmingly negative, a recovery often follows.

5. Market Volatility & Geopolitical Disruption

Guest: Jason Zweig, Wall Street Journal (22:03–25:09)

• Unprecedented Tariff Policy: 2025 saw sharp declines tied to global trade disruptions under renewed Trump tariffs. He notes the lack of historical precedent complicates forecasting.
  • Quote:

    "Every big setback in the market is unprecedented, but this one feels… more unprecedented than usual." (Jason Zweig, 22:13)

• Staying Disciplined: Investors must ask themselves basic questions ("What do I own, and why?"), and avoid rash reactions to portfolio losses, especially after a large market decline.

6. U.S. Equity Volatility, AI, and the Dollar

Guest: Mike Pyle, BlackRock (25:09–28:34)

• AI as a Market Driver: Resilience in U.S. equities post-April stems from the global rush for exposure to AI-driven transformation.
• Unusual Dollar Dynamics: The U.S. dollar weakened even as equities rebounded, reflecting concerns over U.S. inflation and fiscal imbalances.

7. AI as a General Purpose Technology – Economic Impact

Guest: Neil Shearing, Capital Economics (28:34–33:20)

• AI Parallels to Industrial Revolution: AI is likely to boost global productivity akin to steam, electricity, and the Internet, potentially raising productivity growth 1–1.5% per year.
  • Quote:

    "We should be expecting this to deliver a boost in productivity growth globally… This latest breed of large language models... can be considered to be general purpose technologies." (Neil Shearing, 29:09)

• Fracturing Risks: AI’s benefits will accrue most to countries best able to develop, diffuse, and adapt—namely, the U.S. and close allies. Policy missteps or protectionism could blunt the U.S. lead.

8. Investment Implications of Generative AI

Guest: Sudarshan Murthy, GQG Partners (33:20–34:46)

• Hype Cycle: Generative AI will drive business transformation over five years, but business models to generate revenue directly from AI are still emerging.
  • Quote:

    "Just like for the iPhone… it’s likely that in generative AI, AI-native business models will take some time to emerge… but five years from now, it’s likely that generative AI will have a big impact." (Sudarshan Murthy, 34:03)

9. Unexpected Sector Winners in Tech Revolutions

Guest: Joe Davis, Vanguard (34:46–39:02)

• Multiple Tech Booms: Transformative tech cycles unfold in two phases: first, massive investment in direct technologies (e.g., hardware, software), then spillover benefits into unexpected sectors (e.g., auto during electrification, retail with the Internet).
  • Quote:

    "If this thing has legs, then it’s going to spiderweb into outside of Silicon Valley." (Joe Davis, 38:48)

• Non-Tech Opportunity: Great investment opportunities often materialize in non-technology sectors as revolutions ripple across the economy.

10. AI & Portfolio Construction Cautions

Guest: Callie Cox, Ritholtz Wealth Management (39:02–41:13)

• Concentration Risk in S&P 500: About one-third of the S&P 500 is now the “Magnificent Seven”—high tech concentration that may not match investors’ actual risk tolerance.
  • Quote:

    "At the moment, you are very, very tech heavy, whether you realize it or intend to be or not." (Callie Cox, 39:27)

• Diversification Techniques: Suggests gradual rebalancing into defensive or value segments, and incorporating non-equity assets, especially with economic headwinds.

11. Small & Mid-Cap Opportunities

Guest: Brian Selmo, First Pacific Advisors (41:13–44:13)

• Market Structural Changes: Heavy flows to passive strategies and dominance of mega-caps leave mid-caps undervalued, creating opportunity for active investors.
  • Quote:

    "We have been very much net sellers of large and mega cap companies and buyers of mid cap companies… there are larger drivers…" (Brian Selmo, 41:20)

12. Cautions on Private Equity & Private Markets

Guest: Daniel Rasmussen, Author/Investor (44:13–48:29)

• Overcrowding & Risk: Private equity captures a tiny fraction of global profit pool, but institutional allocations are disproportionately large, exposing investors to concentrated risk.
• Transparency Concerns: High leverage, illiquidity, and pro-forma accounting obscure true risks.
  • Quote:

    "You're looking at very, very, very risky set of companies… To take 40% of your portfolio and put it in these… is a very, very risky decision." (Daniel Rasmussen, 46:16)

Guest: Eric Jacobson, Morningstar Manager Research (48:29–52:41)

• Liquidity Limitations: Interval/tender offer funds and private debt vehicles aren’t liquid like mutual funds; redemptions can be delayed or limited, especially in crisis.
  • Quote:

    "It's not the same as a regular mutual fund. It's not like an ETF. You cannot just get your money back right when you want it." (Eric Jacobson, 49:50)

• Systemic Risk Uncertainties: Little transparency in private markets means it's hard to foresee links that could spur crises.

13. Valuations: A Guide, Not a Signal

Guest: Barry Ritholtz, Author (52:41–57:40)

• Beware Market Timing: Relying on valuation as a market timing tool leads to persistent underperformance; dollar-cost averaging and compounding are more reliable.
  • Quote:

    "Valuation is not a timing signal. Valuation is a reveal of where we are in a market cycle. And I don't know if that's all that actionable." (Barry Ritholtz, 54:51)

14. Investing vs. Gambling

Guest: John Rekenthaler, Morningstar (57:40–End)

• Equity Ownership Pays Over Time: Owning stocks is fundamentally different from speculation: equities generate real long-term returns above inflation. Compounding favors patient investing, not fads or gambling.
  • Quote:

    "The house is with you when you're investing. Over time, equities, they make more money than inflation… So the longer you're in and the more money you have, likelier, the better off that you'll be." (John Rekenthaler, 57:50)

Memorable Quotes by Timestamp

• Emerging Markets Diversification:

  "If you're a global investor and a very long-term investor, you've got to access all the sources of return or as many as possible..."
  (Hendrik du Toit, 02:06)

• U.S. Market Outperformance:

  "Call it 80, 85% of the US's victory has come from multiple expansions."
  (Cliff Asness, 09:30)

• Europe’s Fiscal Shift:

  "They're spending on infrastructure, spending on defense, you know, reducing that austerity mindset. And I think that is positive for European growth..."
  (Vincent Montemaggiore, 14:38)

• China Sentiment Cycle:

  "Even though, again, in the past 12 months, China's been the best performing major stock market in the world, most people have very, very little interest as of right now."
  (Louis-Vincent Gave, 21:19)

• Market Disruption and Discipline:

  "Every big setback in the market is unprecedented, but this one feels… more unprecedented than usual."
  (Jason Zweig, 22:13)

• AI as General Purpose Tech:

  "These can be considered to be general purpose technologies... that deliver large increases in productivity."
  (Neil Shearing, 29:09)

• S&P Concentration Risk:

  "About a third of your portfolio is invested in these magnificent seven stocks. At the moment, you are very, very tech heavy, whether you realize it or intend to be or not."
  (Callie Cox, 39:27)

• Private Equity Cautions:

  "To take 40% of your portfolio and put it in these very small, very levered, very risky companies is a very, very risky decision to do."
  (Daniel Rasmussen, 46:16)

• Valuation and Market Timing:

  "Valuation is not a timing signal. Valuation is a reveal of where we are in a market cycle. And I don't know if that's all that actionable."
  (Barry Ritholtz, 54:51)

• The Power of Long-Term Equity Investing:

  "The house is with you when you're investing... equities make money than inflation over time... So the longer you're in and the more money you have, likelier, the better off that you'll be."
  (John Rekenthaler, 57:50)

Conclusion

The episode’s recurring message is clear: long-term success lies in global diversification, measured risk-taking, resisting fads, and remaining skeptical of crowded trades—even those with sophisticated narratives. Transformative technologies like AI offer prospective gains not just in obvious sectors, but across the economic landscape; however, investors must manage timing, valuation, and liquidity risks with discipline. Above all, patience, diversification, and humility—rather than reactionary bets—remain the hallmarks of effective investing.