Mark Skousen: Why He's Still 100% Invested at All-Time Highs

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Mark Skousen (1:00)

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Mark Skousen (1:29)

Do you know you're in a bubble? When you're in a bubble, it's really hard to tell. We have a permanent inflation policy. That is our policy. Tech stocks should fall in half and still be overvalued. I'm fully invested. I'm 100% invested.

Maggie Lake (1:48)

Hello and welcome to Wealthion, I'm Maggie Lake. Joining me today to discuss the outlook for markets is Mark Skousen, author of the Skousen Report at the Oxford Club and Professor of Economics at Chapman University. Hi Mark, it's wonderful to have you on.

Mark Skousen (2:02)

Maggie, this is a pleasure.

Maggie Lake (2:03)

So we're going to talk about some serious stuff, and it feels like we're kind of at a serious juncture for markets.

We have had a lot of moves recently by the Treasury Department and Scott Besson. We have a Federal Reserve meeting coming up. We've got inflation data out this week. What do you think? What's your view on the state of the US economy right now?

Mark Skousen (2:25)

I think it's in fairly good shape. In fact, my gross output statistic, which measures not only consumer spending, but business spending, because I don't know if you know this or not, but GDP leaves out the supply chain, which is bigger than GDP itself, but it's robust. I mean, for a year or two there, the supply chain was struggling with tariffs, with the pandemic. The supply chain shortages were very real. But that seems to be ending. And now I'm seeing B2B, business to business, business spending actually growing faster than GDP, which is a good sign that business is catching up to the consumer.

Corporate profits are at record highs. There's a lot of good things that are going on that the bears seem to ignore.

We're always getting people predicting a collapse in the economy and stuff like that. And I just don't see it. In fact, I think we're entering a, we're in a golden era, especially led by technology. And that's why the stock market's all time high. So it's overlooking interest rates rising, a potential crisis in the treasury market, because the government is spending money like water, not only in the United States, but other countries as well, huge deficits. And can we manage those? That's the real question out there. And I think that's why Scott Bassett is engaged in a buyback policy, which is kind of like what companies are doing with their stock, trying to keep interest rates low. I don't think he's going to achieve it. It's more the Federal Reserve's policies that determine inflation and interest rates.

Maggie Lake (4:22)

So that's so interesting that there's cause for optimism. So maybe a good question would be, first of all, it sounds like you think people are too bearish, both the economy and stocks. How are you thinking about the balance of opportunity and risk, because if we've got all this good stuff happening in the economy around technology, does that over outweigh or maybe some of the risks you just talked about around treasuries? How are you thinking about the interplay between those two markets?