Trust, Data, And The Long View

Markets don’t break because of a single headline—they bend under the weight of what we choose to trust. We dig into where confidence belongs right now, from focused bets on innovation to the steady ballast of cash and gold. Along the way, we spotlight an underrated growth engine: America’s university system, where research, endowments, and relentless training keep producing the people and ideas that power AI, advanced chips, health tech, and the next wave of startups.

We get honest about risk. Crypto’s shifting identity and the chorus of promoters look a lot more like a sentiment trade than a true hedge, and parts of private credit carry opacity and liquidity traps that investors too often ignore. Time horizon is a real edge; illiquidity by itself isn’t. We also unpack why government policy and tariff theatrics can distort decisions, and how markets frequently climb despite policy noise, not because of it. If you’re searching for a practical framework for innovation investing, risk management, and portfolio construction, this conversation offers a grounded path.

There’s a human side to returns that rarely trends. Attention spans are shrinking, snap decisions are rising, and that’s bad for compounding. We make the case for a slower, clearer process—sleep on choices, define outcomes, and check assumptions—while elevating wellness as central to financial performance. Health, focus, and flexibility aren’t perks; they are part of your capital stack. Employers who support hybrid work and recovery build stronger teams, and investors who protect their energy make better calls across cycles.

If this resonates, follow the show, share it with a friend, and leave a quick review. Your feedback shapes what we explore next, and your questions might steer a future episode—tell us where you place your trust.

Straight Talk for All - Nonsense for None

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Disclaimer - These podcasts are not intended as investment advice. Individuals please consult your own investment, tax and legal advisors. They provide these insights for educational purposes only.

Chapters

• 0:00 Welcome And Framing Trust
• 1:01 Data Versus Patience In Investing
• 2:56 What We Trust: Innovation, Cash, Gold
• 5:55 Universities As Engines Of Talent
• 9:55 Acts Of Kindness And American Will
• 12:00 What We Distrust: Fads And Crypto
• 15:32 Government Policy And Tariffs Skepticism
• 18:29 Private Markets, Liquidity, Time Horizon
• 21:50 The Perils Of Quick Decisions
• 25:02 Wellness, Human Capital, And Work
• 27:47 Closing, Thanksgiving, And Survey

Transcript

Steve Davenport: 0:26

Hello, everyone, and welcome to Skeptic's Guide to Investing. I'm Steve Davenport, and I'm here with Clem Miller. And we're talking about trust. We're looking at what's happening with the government shutdown ending and the data that everybody is waiting for with bated breath. And I sit here and I think, okay, should we have more data? And is data gonna necessarily make our lives better because we trust it and we believe it influences the macroeconomic and the business results? Or does we trust patience and just wait and say these are long-term investments and looking at monthly inventory data or looking at monthly data on employment and whether this many teachers were laid off for the holidays or this many people were hired at Amazon to work in the warehouse during the busy time of Black Friday? I would say, Clem, that this is a tough topic because different people have different hot points on which two things they think they trust and which two things they distrust. Let's start in the positive and then we'll end in the the negative. , which two things do you trust the most in the financial system? That is it the data, is it the CEOs and the people? Is it the companies' technology? Is it the government asserting and helping companies with ownership stakes? Is it the you know the tariff process that's gonna right the wrongs against America? Where is your trust? What two items do you have the most faith in that are in the financial system that are gonna help our average investor you know improve their financial wellness? Where's your trust right now?

Clem Miller: 2:32

So I've got two areas of trust. one is in innovation. I'm a strong believer in innovation, technological innovation. I believe that this is an area where you cannot take a beta approach, , but you have to take an alpha approach and pick individual companies. Because certainly there are individual companies that are in in innovative, but yet have not been performing too well. So you have to you have to choose your areas of innovation, choose the individual companies. But I'm very, very trustful of the innovation process, AI and other things and where that might be going. Are there issues we should be concerned about with AI? Yes, there are. but and are there areas of of where we might want to distrust AI? Certainly there are. We can at some point zero in on those. But I think in general, innovation is a very big positive. Second area of of trust is you know, when you're talking about portfolio construction, you know, you got innovation on one side. This is in my portfolio, innovation on one side. On the other side, I have cash and gold. And cash and gold, , I do trust in. And I trust in those because, first of all, if there is a market downturn, my my downturn will be lower than those of other investors. So that's one way I I I trust that. And then the second way I trust that is that if there is a market downturn, I I will have the resources to be able to buy cheap and ride the ride the uphill. So I have some faith in that. It's all a matter of you know what, you know, what do you, you know, how what the proportions are of of what you put into the innovation and what proportions you put into the cash and gold. So those are my two areas of trust, Steve.

Steve Davenport: 4:54

Okay. They seem like they're very similar. Like on the on the one side you got innovation, which is your 50 or 60 percent of the portfolio that you're invested in long term, and then the other side is in safety, which I think that growth and safety are always the two things that we're playing off of each other. And if we believe more in one than the other, then we let our money go where our you know feelings are.

Clem Miller: 5:21

Yeah, and note that we I don't have bonds in there.

Steve Davenport: 5:24

I know you don't have bonds. I realize that you're you're you've been pretty clear of what you like and what you don't like. , I guess from my perspective, the things I trust and I believe in, and maybe this is because I have two daughters who are professors, but I think our college system in the United States is an extraordinary collection of assets for all people in all these states. I'm in North Carolina now with one of the best state-run college systems, and I look at UNC Asheville, UNC Charlotte, I look at NC State and UNC and Chapel Hill and UNC Wilmington, and I know I'm leaving somebody out, but I just look at this system and this state, and then I think about the private universities like the Dukes and the Davidson's, and I look and say, you know, we have a collection of faculties and people who are doing amazing work in areas of AI and areas of health and and wellness and areas of aging. And I just think that, you know, for when you talk about innovation, I'm being a little more specific. I think corporate innovation is one thing, but a system that keeps preparing more and more people every year to come out into the marketplace, have an impact, have skill sets that line up to businesses, and have an ability to do something new and creative. And I look at what is going on at NVIDIA and the way that they have taken the nanometer chips and the the things and tried to you know put them in parallel and make things faster and make things better. And I I do think there is a corporate, you know, part of that responsibility, but I I kind of go back to where are the people learning the skills, where are the people getting the abilities, and where are the people who are starting the next companies? They're coming out of some of the greatest colleges in the world. And I, you know, maybe I'm I'm missing something. I I've had my time as a Col bia grad where I've been frustrated by what's going on in the campus and the different things, and we can focus on the negative, but I have a great deal of trust that our education system, because of the endowments and because of the way they work, , are going to continue to produce great people who are going to be great leaders and are help our business community. And if you want to know why I like America and America investment, it's the colleges. And I don't want to steal something from one of the Clinton's strategists there, Carville, but it's the it's the university stupid. he used to say it's the economy stupid, but I I really believe in the universities, and I also one thing I trust is that there's a lot of people out there who are being kind to others. I'm involved in various volunteer efforts and and things, and I would just say that I see a lot of great people doing great things for others, and I think at this time of year, it's you know, we see people who are eating at the food shelters and getting foods for, you know, taking home a bag of stuff to to have a a meal and celebrate. I I really believe there's a lot of inherent kindness in mankind, particularly in the United States. And I look at the people who are arguing and the people who are attacking each other, and I say, you know, I think that the media might cover that a little more than it covers, you know, the acts of kindness by a lot of people. And I am gonna be idealistic here and say, , the thing I trust is the American will to survive and to thrive and to help others. So American will and universities would be my two things I trust in. , and I trust in them pretty deeply, so I don't think I'm gonna get shaken from those. But now we go to the two things that we distrust about the system and the financials. , what are the two things you distrust in Clem? Is it is it anything to do with government data, or is it have to do with our ability to collect tariffs, or how how how what do you distrust about this market or environment for the average investor to think about this?

Clem Miller: 10:25

Okay, so I've got two totally different areas of distrust. So, first of all, is my standard distrust of fads in markets.

Steve Davenport: 10:38

Okay, and different than themes? Or is it the same thing?

Clem Miller: 10:42

Well, yeah, I mean, others might call them themes. I call them fads, right? Okay, so crypto is a fad that is extremely dangerous, and you can see that you know, over the last few weeks of of or few months of behavior with regard to Bitcoin and and other crypto and companies that you know have invested in crypto. and so I know you know every time crypto starts to go up a little bit, all the promoters come out of the woodwork. and then when crypto goes down a little bit, they they go and hide back in the woodwork.

Steve Davenport: 11:23

yeah, I mean, I think the funny thing is that when the people say no, it's it's it's a it's a currency. Oh, okay. well, as a currency, why did the currency go down when technology stocks started to go down? I thought the currencies were a little more independent. And it's tell me, is it a currency or is it a it's whatever it's whatever the promoters want it to be, is what they tell people, right?

Clem Miller: 11:49

It's whatever works, it's whatever falls into their story or supports their story, whether it's quote a currency or a commodity or an asset or whatever they want to call it. the reality is that it's none of those things. it's a fad. And , and so you know, if you want to waste your money on fads, be by all means go do that. but you know, I'm I it's something that I've I've long distrusted. I'm consistent on that. And I would never put one penny of of anything I I wouldn't put one penny of my own money in in crypto. Not one penny of crypto. How about your wife's money? Would you put her money in it? No, I wouldn't I wouldn't put put her money in that either. But like I said, you know, I can't tell people what to do. So if you know, and I know that there are advisors and others out there who say, well, hold a little bit of crypto. Why? Okay. Why? Right? You know, it's just it's it's it's ridiculous, right? So the other thing I distrust is I distrust government. And all government or only the US government, or , I think it's fair to distrust all government and in particular the US government, and at this point, and and and you know, I would have to, you know, to be fair, I would also throw in the Russian government and the Chinese government and the Korean government and the Iranian government and the Israeli government. , I think you know, rogue states, okay. I have some issues with with rogue states. Well, you just mentioned three or four of them.

Steve Davenport: 13:41

What do you who else are you talking about?

Clem Miller: 13:45

well, I guess you could put Venezuela in the rogue state category, too. All right. But yeah, I mean, , you know, arguably the U.S. is, but then Russia, China, Iran, Venezuela, Israel, , North Korea. , you know, those are the , you know, those are what I would call rogue.

Steve Davenport: 14:05

I saw an article this week about, you know, some kind of a deal going on with Zelensky and whether he's you know involved in some kind of a scandal.

Clem Miller: 14:15

Yeah, well, yeah, Ukraine has been known for corruption, but I don't know that I don't know that it's actually touched them, but I'm not really talking about corruption. Corruption is a widespread issue in lots of countries. I'm really talking about behavior in the international system, right? Whether you know, countries are just pursuing their own narrow their own narrow goals without any consideration for their for their neighbors or the broader international community, or whether they're you know, whether they're willing to cooperate. And those rogue states I just mentioned are clearly looking out for themselves and not cooperating with the with the global community. And unfortunately, the US has entered that that that group of you know come that group of countries, and and and that's why I think it's fair not to not to trust the US as much as as one could before. And I think as far as you know, this has you know, as I'm as I've indicated elsewhere, I think that markets have done extraordinarily well despite of US government policies, not because of them, right? I mean, I don't, you know, a country whose government can impose enormous tariffs and say that you know, say that they're because of some kind of trade balance emergency, and say that foreign countries are paying the tariffs, I mean that's wacko stuff, right? it's it's not classic economics. It has no basis in reality. And and if you're talking about a government that makes decisions without a basis in reality, that's a problem. Right? That's a problem. and so that's you know, if we didn't have that kind of problem, that kind of reality, you know, the possibility of decisions being made on the fringes of reality or beyond what's what is reality, I think if that weren't an issue, I probably wouldn't have as much cash and gold in the portfolio as I do now. but I feel like I have to because of you know these policy issues and and you know the rest is sort of AI kind of related, and I think AI is gonna do innovation is gonna do I mean it may be overvalued right now and it may have a pullback, but I think it's going to do well regardless of what of what government does. Okay. So what's item n ber two? I gave you two. Oh, okay. N ber one was was fads. Fads, okay. Yeah, fads, crypto and and and I I would I would put you know also into fads potentially you know certain elements of private markets now. So private credit has been having some issues lately. And I know that private credit has been like the darling of a lot of a lot of investors, a lot of advisors. People read a lot about private credit, but there have been some issues with that, with that lately, with BlackRock and and and so on. So it's a it's an issue, right? private credit. And so I don't know that I would be advising anybody right now to get into any kind of private credit vehicle. I think it's you know, I I'm a public markets kind of guy, right? I like public markets. I think there's like your liquidity. There's liquidity, there's visibility. you know, this this kind of academic, it's really an academic thought that if you give up liquidity, you get return. I mean, just think about that logically. Why is that? I mean, what's logical about that? There's no there's no guarantee that by giving up liquidity you're going to get higher return.

Steve Davenport: 18:59

I think I think when they say giving up liquidity, , they're asking you to be patient and have a longer time horizon. Right. And I would say that the time horizon determines a lot of the private success, not the lack of liquidity. Right. Time horizon to me is the answer, not liquidity.

Clem Miller: 19:18

Okay, so yeah, I agree with you, but think about this a little bit. You know, a longer time horizon means that there's a greater there, yes, there's a longer longer term possibility that there will be success. But there's a longer term possibility there could be failure too, and yet you're locked in.

Steve Davenport: 19:42

So I I just I just I think that I think there's two different points you're making. One one is I I don't have full clarity. So without full clarity on the underlying company, because privates are necessarily less known, that un unknowable aspect makes it risky. And that's that's true of you know, if hey, all of these companies release data, but you know, public companies who have things going on that are not present in their data, they have the same risk as that private. It's just that you know what I mean. They're they they've been able to keep this research project they've been doing, and it's been successful or not successful. I mean, there's things going on, and I think it's do we have full knowledge? And I don't think we have full knowledge even of the most public company. , I think it if I could go to my two, the thing that I find and distrust the most is quick judgments and decisions. I think the average concentration of investors today, I think is something around nine seconds that we focus on an idea for about nine seconds. It was 16 seconds just a couple of years ago. It's been as high as 30, you know, five years ago. I I look at this and I think this is what I believe will be the most disturbing part of AI and all of this information is if we react and think about items for shorter periods of time, we're gonna be less likely to discern a difference or a mistake by AI in the process of helping us. And if they make obvious decisions wrong and make statements that are incorrect, , we have to pull back and say, okay, I thought this was, you know, taken care of, and I thought this had this type of ability. But you know, I I really distrust what I would call quickness. If the quickness of a decision, and we say that it's a really good decision, comes through. I kind of believe that that speed isn't the answer when we look at how we should invest. I think you should take some time. I think you should sleep on it. If you should sleep on whether to spy a $500 TV, what should you do with a $2,000 investment in, you know, your child's college account? I think you should think about. I think that you should think about what you want and what you're trying to achieve, and then apply what I would call some rigor and analysis that's greater than the standard. I distrust short-term thinking because I believe that it misses the boat. I believe that as a country, as a civilization, as a society, we need to think a little harder and a little longer in order to truly get to what I think is you know a better world. And that's just me. that's where I am. and I guess I would also say that as a whole, I distrust people's decisions in terms of how you make and decide on what things are important in your life. I think that individuals need to put their physical, mental, and spiritual well-being first, not second. I I think that you talked about it. I did the same thing when I was working. I was trying to get into that seat early. I was trying to get to my computer so I could check the news, check how things were opening in Europe, and look at, and I was just absorbed with being fully absorbed. I wasn't really taking care of, you know, what I'd say is body, mind, and soul. And I think that the thing I distrust is that we as a society don't do a good enough job of taking care of the greatest asset we have, which is our h an capital. And that h an capital can do amazing things for you. But just like the car, you got to change the oil, you got to make sure it's running right, you got to make sure it has good tires. I think there's a a real renewal that we need to do as part of this. Coming out of COVID, my realization was I needed to focus on some basic things like exercise, better diet, better, you know, time for meditation and prayer. So those things matter to me. And I think for everyone, your financial health and wealth is one part of your overall balance sheet. The main part is your your your h an capital. So in terms of distrust, I distrust short-term thinking, and I distrust that we are not putting ourselves first. So those of mine, I don't know if they fully captured what we distrust in markets. I guess I would say that when I think about the second part about wellness, , I want the overall goal of everyone to be how do we make lives and influence things that are better. And I'd love to see companies doing more to try to help people with this wellness goal. And if they were, I think it would really have a bigger impact because I think people, when when they have more balance in their life, I think they're better employees and ultimately better for the overall economy. So if I could, you know, say one thing. I think that getting back in the office to me, I understand communication, but I also think that part of that is that people have gotten used to a healthier lifestyle at home doing things and pushing them back into the office is gonna not enhance that wellness. I think it will degrade it. So I hope that we as companies realize that okay, if we're gonna want people in the office, then maybe we need to do something to allow them to have the same flexibility and some of the things that they have to improve the quality of their life because ultimately better employees, better community, better results for everyone. So anything else you want to say about trust?

Clem Miller: 26:46

No, I think I've I think I've covered it. , I agree with you about wellness, and I think it's very important to to focus on yourself with the wellness.

Steve Davenport: 27:01

All right, everybody. Thanks for listening, and this will probably come out sometime close to Thanksgiving. So have a great Thanksgiving and please like, share, and let other people know that you enjoy the podcast. And we look forward to serving you. And check out the survey that is under Clem's LinkedIn account and let us know what it is we do that you like and what you wanted us to do more of. All right. So everybody, thanks. Have a great day. We appreciate you.