250 Years of American Compounding with Meb Faber

Frazer Rice talks with Meb Faber about Faber’s book Investing in America: The Rise of a 250-Year Bull Market, the long-run compounding of U.S. stocks, and his argument that large institutional pools such as CalPERS often fail to beat a simple low-cost buy-and-hold portfolio. The episode covers the book’s origin in meme-stock-era retail trading, the history of diversification, and Cambria’s shareholder-yield approach. It also discusses Faber’s view that complexity and expensive manager access do not reliably improve investment outcomes.

1. Faber puts a dollar invested in U.S. stocks in 1800 at roughly $200 million today and uses that to frame staying invested through wars, depressions and pandemics.
2. He traces diversification to 15th- and 16th-century joint-stock voyages, where spreading capital across risky expeditions helped merchant adventurers survive losses.
3. Cambria’s core factor is shareholder yield, which Faber describes as cash dividends plus net buybacks, net of dilution from stock-based compensation.
4. Faber argues that giant institutional pools with broad manager access still often fail to consistently beat a disciplined global 60/40 portfolio.