This week, we speak with Mike Swell, co-head of global fixed income portfolio management at Goldman Sachs Asset Management (GSAM), where he is responsible for co-leading the global team of portfolio managers that oversee multi-sector portfolios. He joined the firm in 2007 as a managing director and head of structured products, and oversees $700 billion dollars in fixed income assets.
The demand for US bonds remains very high. In an era of low and negative bond yields overseas, U.S. yields at 2, 3, even 4% remains very attractive. Swell believes the Fed will be on hold for a long while, and rates will be “Lower for longer” possibly much longer. “Do not fight the Fed” is usually good advice, but it is especially valid today. He notes there is not a shortage of bonds, but there IS a shortage of bonds at good prices.
We discuss the possibility of the Biden Administration implementing a major infrastructure builds out, and a long term investment plan for both the United States and overseas. When we discussed the possibility of 100 Year bonds to pay for this build out, Swell said if he was in charge of Treasury, he would issue “1,000 year bonds.”
A list of his favorite books are here; A transcript of our conversation is available here.
You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Stitcher, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here.
Be sure to check out our Masters in Business next week with Tom Slater, head of the US equities team at Baillie Gifford, which has over $282 billion in assets under management. His main investment focus is high growth companies, both public and private. He serves as a decision-maker on Long Term Global Growth portfolios, and the U.S. Equity Growth Fund +113% year to date. He also manages the Scottish Mortgage Investment Trust, which Baillie Gifford has been managing since 1908.
Mike Swell’s favorite books
Devil in the Grove: Thurgood Marshall, the Groveland Boys, and the Dawn of a New America by Gilbert King
Just Mercy: A Story of Justice and Redemption by Bryan Stevenson
Hillbilly Elegy: A Memoir of a Family and Culture in Crisis by J.D. Vance
Contrarian Investment Strategies: The Psychological Edge by David Dreman
Thinking, Fast and Slow by Daniel Kahneman
