The Secret Sauce Behind 250 Years of American Success (McKinsey’s Rebecca Anderson) | #638

**Meb Faber** (0:06)
Welcome to a special series of The Meb Faber Show on the past, present and future of America. I'm sitting down with some of the most notable historians, thinkers, investors in US financial history, all tied to my new coffee table book, Investing in America, The Rise of a 250-Year Bull Market, out July 4th.

**SPEAKER_1** (0:26)
Meb Faber is the co-founder and chief investment officer at Cambria Investment Management. Due to industry regulations, he will not discuss any of Cambria's funds on this podcast. All opinions expressed by podcast participants are solely their own opinions and do not reflect the opinion of Cambria Investment Management or its affiliates. For more information, visit cambriainvestments.com.

**Meb Faber** (0:41)
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Hey, everybody. My guest today is Rebecca Anderson, Senior Fellow at the McKinsey Global Institute. McKinsey's business and economics research arm. She leads research on economic growth, financial system in the United States and globally. Earlier this year, she published one of my favorite pieces of the entire year. An amazing report titled At 250, Sustaining America's Competitive Edge. Rebecca, welcome the show.

**Rebecca Anderson** (2:23)
Thank you for having me, Meb.

**Meb Faber** (2:25)
I wanted to mention real quick, listeners, nothing in this episode is investing advice, which is always true, but particularly true today. We'll start a little bit broad as we look back at this period. It seems like this has almost been like a secret sauce. And so I'd love to hear what you think that might have been.

**Rebecca Anderson** (2:41)
Perhaps before answering that question, maybe also to just share a little bit about the impetus for why we did this report. Of course, as you mentioned, this is the 250th anniversary of the United States. And at the McKinsey Global Institute, we research deep structural forces that are changing in the global economy. And one of our big themes of research recently has been that we are at the cusp of a new era for the global economy. That's really largely defined by things like heightening geopolitical fragmentation, as well as rapidly advancing technology like AI. And so we figured, given that we're at this juncture point in the global economy, and given the fact that the US has this big birthday or anniversary this year, it would be a really great time to take a step back and think about the world's largest economy. Can the US stay that way and what would it take to go forward? And to your question, what has been that secret sauce, so to speak, for the last 250 years? Fundamentally, there are a couple foundations that the US has had throughout the last 250 years that have really shown through time and again. The first one that we've mentioned is basically natural endowments. So the US has had and continues to have tremendous natural resources. And different resources have been important at different moments in history. For example, in the first century, the fact that the United States had a ton of arable land, the most arable land per capita of any advanced economy or major economy today.
Similarly, coal and oil were a really big part of the story in terms of just pure fossil fuels. Having copper reserves was really important for electrification. But then, in addition to that, geographic features of the country, for example, having a ton of navigable waterways internally, as well as access to deep water ports. The US has the most natural deep water ports out of any major economy in the world.