He Studied Every Bear Market Since 1929 | Ben Carlson on How the Worst Starting Point Still Made 8%

Ben Carlson joins Excess Returns to discuss his new book Risk and Reward and the biggest lessons investors can learn from market history. We cover how to think about risk, inflation, market timing, bear markets, lost decades, diversification, compounding and why surviving volatility is the key to building long-term wealth.
Ben's Book
amzn.to/4dFHsQz
Ben Carlson on X
x.com/awealthofcs
Ben's Blog
awealthofcommonsense.com
Main topics covered:
• Why risk is hard to define and always involves trade-offs

• How vivid risks like sharks and headlines distort investor decision-making

• Why doing nothing can be one of the hardest parts of investing

• How inflation should be viewed through personal finance, human capital and long-term investing

• Why stocks can be an inflation hedge even if they struggle during inflation spikes

• Why waiting for the market coast to clear often fails

• What the world’s worst market timer teaches about saving and staying invested

• How loss aversion shapes investor behavior

• What the Great Depression, bear markets and 30-year returns teach about long-term investing

• Why there is no perfect portfolio and the best strategy is one you can actually stick with

Timestamps:
00:00 Ben Carlson on why risk and reward are attached
06:35 Doing nothing, action bias and better investing behavior
11:51 Inflation psychology and lessons from the 1970s
16:55 Why stocks can hedge inflation over the long run
21:07 Why waiting for the coast to clear is a market timing trap
26:30 Time horizons, loss aversion and portfolio behavior
31:49 Government rescue, left-tail risk and unintended consequences
35:54 Recessionary vs non-recessionary bear markets
42:09 Why the stock market and economy can diverge
47:24 Why compounding is about holding, not trading
51:37 Starting valuations, lost decades and future returns
55:40 Risk, reward and the biggest lesson for investors