Memory Is A Bubble, But Nvidia Protected – Jan Van Eck On Semis Surge

**Jan van Eck** (0:00)
Well, what I would say within the AI ecosystem, Wilfred, there are bubbles, to use a word, that probably don't like that much, right? I do think that the memory-specific pocket is a moment in time. You know, one hates to call a top when something is like this, but I personally am wary about the memory stocks because in the medium or long term, they don't have quite the competitive moat. I believe that Nvidia does. I think we're in what we call a crypto winner, and I don't think it's coming back. Like, I just don't think a lot of those projects and softwares will be at all interesting or alive in five or 10 years from now.
So the concept of blockchain and stable coins are definitely there and Bitcoin is there, but a lot of other parts of the ecosystem are just, to me, going away. It's such a big company, SpaceX, that we're glad as ETF sponsors to have it in the public markets. As you said, the amount of money here is absolutely staggering, right? It's just staggering. You're talking about, cumulatively, hundreds of billions of dollars. It's just the waves of liquidity that are going to be sloshing through the economy, I think will, you know, they'll be positive short term for economic growth and I think they will be absorbed.

**Wilfred Frost** (1:30)
Welcome to The Master Investor Podcast with me, Wilfred Frost, where we celebrate and learn from the success of the greatest investors, business leaders and politicians in the world, giving you, our listeners, the edge. The Master Investor Podcast is sponsored by ELSEG, Interactive Brokers, The World Gold Council and BNY Investments.
Please do remember the views expressed in this podcast are for general information purposes only. Nothing in the podcast constitutes a financial promotion, investment advice or a personal recommendation. More on that in the show notes.
My guest today is Jan van Eck, the present CEO and owner of VanEck and its associated companies, leading the asset management firm, an ETF giant that was originally founded by his father in 1951 He has grown it to the Goliath that it is today, especially in the ETF industry with $225 billion of AUM. He is a regular podcast participant, always sharing his opinions loud and clear, which we very much welcome here. Jan, welcome to The Master Investor Podcast.

**Jan van Eck** (2:42)
Wilfred, it's great to be here for the first time with you.

**Wilfred Frost** (2:46)
I wanted to just jump straight in to the kind of ETF that I think is, as far as I say, has really driven a lot of your performance in recent years, but is right at the center of everything in markets right now. And that is the SMH, of course, focusing on the semis, which has had unbelievable performance of late. I think I'm right in saying it's now $65 billion in AUM, is that right?

**Jan van Eck** (3:11)
Something like that, yeah.

**Wilfred Frost** (3:13)
And obviously is now the go-to place for people that want exposure to the area. Year-to-day, it's up 58%. Over 12 months, it's up 135%.
Almost more impressive than that. Since inception, it's up 29% per annum.

**Jan van Eck** (3:32)
That's crazy, right? That's really hard to do on a compounding basis. We should retire right now.

**Wilfred Frost** (3:40)
Yeah, exactly. Tap out now, but I'm sure you won't, and that's why you're showing up for this podcast. But in the last year or so, how much of that is price performance versus inflows to get it to 65 billion?

**Jan van Eck** (3:53)
Oh, price a lot is price performance. I mean, I can't imagine that more than 10 or 20 percent in the last 12 months has been inflows.

**Wilfred Frost** (4:03)
That's interesting. I would have thought there was at least a significant more of inflows than that. And what do you think has been driving it? I mean, maybe it's a simple question, but is it the AI theme, pure and simple?

**Jan van Eck** (4:16)
Yeah. I mean, listen, I think the VanEck investment philosophy is to try to take a big picture macro view. I call it 10 year macro. And what I mean by that is in 10 years looking back in 2036, we were going to look back and say, what are the very biggest themes affecting the world and therefore financial markets? And that hopefully filters out a lot of noise. But I think what we're left with is three things, at least, AI, the rise of India, and then the over-borrowing by the US, your country, the UK and Japan leading the way, I would say.