Why I'm Selling American Stocks | Scott Galloway

Key Takeaways

you had um a pretty bold uh thought last time that you were on. I think you said something Laura. You uh you predicted that America's decade, the next decade for America is going to be flat in terms of economic growth and um I think you also said for the uh index funds. Do you still believe that to be true? >> Yeah, I'm selling down my American stocks mostly because I'm diversifying because I don't want to lose. I've lost all I've been rich three times which means I've lost it twice. I can't go back. I'm not You guys are young and have good hair. I'm neither neither of those things. I can't make it back again. So, I'm diversifying. And if you just look at the cycle of American markets or the global markets, typically the US outperforms for eight years, then emerging markets outperform for eight years. It goes back and forth. We've been outperforming emerging markets for 17 years. I still believe the markets are cyclical. The Buffett index stock market valuation versus GDP, he likes it at about 90%, it's at 210%. The S&P is trading at historic highs. 97% of the time, the S&P has traded at lower valuations relative to earnings. So, it's not it's not a criticism of America. I just think America America is an asset. The rest of the world is an asset. There's America is an asset. Everything every public company in America, every public company outside of America, they're equally priced right now. They're both you can own every public company in America for 100 bucks or you can own every public company outside of America for 100 bucks. What do you think is the better value right now? >> Well, I mean that's a leading question, but I I I would have always assumed America. >> Oh, see I think if you take Okay. Every public company in China, Europe, Latin America, you think is worth less than the public companies in America? >> I think I think I think like I think that when you look at the S&P, I think that the big American companies to me aren't American companies. They >> called international company. That's fair. That's fair. >> That that's so like Apple's not an American company. It has its major office in Certino, but I don't think of it as an American company at this point. >> That's that I think that's a thoughtful response. Yeah. I think America's too expensive right now. I think Europe's on sale and by virtue of the fact that I am an American and basically the majority of my advertiser. I'm always going to be very invested in America because I own a bunch of real estate in America and my company is largely driven by American human capital and American advertisers. So what I'm trying to do is I think the most powerful word I didn't learn until I was in my 40s was diversification. I just think America's expensive right now. It's not even a statement on the judgment on America or American companies. I just think America's overvalued right now. Do you want to hear some of the uh other predictions that you made on our podcast and we went and looked if they were right or wrong. You said Apple was overvalued. I think we did this podcast 8 months ago. You said Apple Apple was overvalued. You were right. Uh they I think the stock went down since then. Uh you said that we uh what did you say? You said that the GLP1s were going to be bigger than GPT4. Uh I believe you were right there. I think the the GLP1 market cap I think there's like a GLP1 index. I think has grown faster than Chad GP or OpenAI's uh uh valuation. You said uh MRNA stocks are going to decline and I think you got that correct uh big time. >> Madonna's up 90%. >> Yeah. Yeah. Yeah. Yeah. It's down. And then you also said that but here's this uh interesting one. You said that food you thought that food stocks because of uh uh GLP1s were going to be down and McDonald's is not down. I think but I think you like made a prediction that you thought that GLP1's going to be so big that McDonald's were going to go down. >> I think GLP1 is a more transformative technology than AI. I've said this for a couple years. So Sean, we were talking about micro doing Yeah. or whatever it is. >> I'm going to assume you are micro doing GLP1 drugs. Let me ask you what's had a bigger impact on your life, JLP1 drugs or AI? >> I I don't micro What? What do you mean? I don't micro disc JLP1. So I can't >> Oh, I just assumed since I've seen you, you're fit and trim, which I assume means you're ongo, but we'll go with the notion. >> You just gave her new. And by the way, by the way, I don't take ED drugs, just so you know. I don't I absolutely I don't know what you're talking about. I don't I don't take I don't take Viagra before it's go time every fourth Sunday uh during the summer solstice when my partner agrees to have sex with me. I absolutely don't take Viagra. Anyways, let me ask you this then more more broadly. >> If someone is on a GLP1 and they're using AI all the time, what do you think has a bigger impact on their life? >> For sure. The GLP1 the fastest way to deficit reduction. If I could be president for a day or king for a day and I had a magic wand mandatory national service. Let me say that right now. $25 an hour minimum wage. But the third thing I would do, I would put out the mother of all RFPs, Denova, Nordisk, Eli Liy, and say I need a billion doses of GLP1s and then I would distribute it for free to every rural household in America. And I would take health care costs from 13,000 to $6,500 and boom, we have a deficit solved. GLP1 is the most transformative technology of the last 20 or 30 years. It's the biggest thing since GPS is the way I see it. >> That is a a wild take. That's what we were going to actually ask you. If you were in charge uh for a certain amount of time and you could wave a magic wand, what would you do? And you just answered that question. That's I I I never It's very interesting. I never in a million years thought you were going to say that. >> Do you feel like the Do you feel like the data is out on, you know, the either long-term effects, the downsides of it, or are you saying doesn't really matter, the upside is so big that we can we can figure out how to mitigate the downsides? >> Oh, I I mean I'm not a scientist. We might find out that 30 years down the road, people are getting pancreatic cancer. Generally speaking, >> President Galloway, you just ordered a billion doses. >> Generally speaking, there's no free lunch, right? Generally speaking, whenever the AIDS cocktail was worth it, but it ended up giving giving people who are on it cholesterol problems. Chemotherapy is amazing. You do enough of it, you're going to get leukemia in 20 or 30 years. There's just no there's no free lunch. I'm a much better version of me. A little up. I love alcohol. I've got more out of it than it's gotten out of me. There's definitely not a freelancer on alcohol. So far, everything we keep learning about GLP-1 is that, oh, it's even better than we thought. It might >> It makes you live longer. >> It might delay cognitive decline. >> It stopped my gambling addiction. >> Porn addiction. They're b people are biting their nails less. >> Have you taken it? >> No, I might micro dose it at some point. >> I'll be the guinea pig here. Uh, B, I had drinking and drug issues and um I've been sober for a long time. >> Store, you you came on here. He came on the podcast like what four years ago? >> 20 I think or 21 years ago. He told me about something he read in a Reddit forum and he injected into his body. This was before the trend and he's like this thing is amazing. He's like I'm [clears throat] losing weight. He's like but I also I don't have any cravings. You told me you said on the podcast you go I think this is going to cure alcoholism. >> What technology tells you to stop eating ice cream and eat more kale? >> Well, okay. So, I I I've been sober for 12 years or so, but when I took it 5 years ago, I was like, you know what's crazy is I walked by a brewery the other day and sometimes when I walk by breweries and I smell like hops. You guys ever like smell that in the middle of the day, I'm like, "H, that's amazing. I wish I was there." I remember smelling it and I was like, "I don't like wish I would like I don't want to go there and like drink this stuff." And then I remember eating like a scoop of ice cream or just a bite of ice cream and I was like, "That was lovely. I don't want it anymore. I'm done." >> Uh, and then I also bit my nails less. It was It was a magical drug. It was a very magical drug and people like me, I'm I'm a fairly fit person. I don't know if it's entirely it's it's not necessary for people like me, but if you're obese, I think it's uh it's really amazing. But yeah, I I and I and I'll micro dose it every once in a while because I just think it's interesting and there's always like new varieties, you know? It's like getting the latest and greatest car. There's all these like new varieties that are just like wild. It is pretty amazing. I think metformin is really interesting, too. Um but there's a bunch of these drugs, man. They are pretty crazy. >> I I I think it's I'd give that out. Um well, I really enjoy this president thing. I would eliminate capital gains and mortgage interest rate deduction. >> Um I'm I need to correct myself. We said dictator. You're dictator. >> Oh, better. Much better. >> So, so this >> dictatorship, if you have a benign the best running countries in the world, i.e. Singapore, it's a benign dictator. Like if you get a good dictator, that's absolutely the way to go. You could argue that China in a lot of ways. I mean, we hate anything that's not democratic. I get it. The Weaguers, a lot of people describe she as a murderous autocrat. the life expectancy 40 years ago in China was 47. It's now 77. They've brought 500 million people out of poverty into the middle class. You could argue that China has pulled off uh something so incredible. Anyways, I would do get rid of uh capital gains tax uh deduction, mortgage interest rate, who owns homes and stocks, people my age, young people. >> You get rid of capital gains. You're you're a complex person, man. You you you don't fall into one category. Why would you do that? Uh because every fiscal policy we've made over the last 50 years is to transfer money from people AR's age to people my age. We have slowly but surely old people have figured out a way to vote themselves more money. And the average 70-year-old is 72% wealthier than they were 40 years ago. And the average 25-year-old is 42% less wealthy. And what do you know? Young people aren't having kids and are fed up with America. We are constantly overinvesting in seniors. >> But how does how does that tie to the capital gains? Cuz don't don't older people own the assets that would benefit from no capital gains tax? >> No, no, no. What I'm sorry. What I mean is they pay current income. They don't get a tax deduction. There should be one. It should be Reagan. There should be one income tax rate for all income you make. And by the way, anyone under the age of 30, like Portugal, should have a tax holiday for the first $100,000. We desperately need to level up young people who don't like America and have mandatory national service such that they start meeting other great Americans. >> That's the tax holiday is a great idea. We need to level up. I mean, it's pretty simple. We need to put more money in the pockets of young people and stop transferring $1.2 trillion from young people to the wealthiest generation in the history of the planet. Old people. Old people have basically raping our economy for the last 30 or 40 years. It needs to stop. >> Okay. >> And what do you know? Our Washington DC is a cross between the Golden Girls and the land of the dead. And they keep voting themselves more money. $40 billion child tax credit that would benefit young families, stripped out of the infrastructure bill. But the $120 billion cost of living adjustment for Social Security flies right through. Enough already.