Collection: Mohnish Pabrai - #69 'The Next Bubble?'


Video Link: https://youtu.be/vHrT6jKFqUI


In this episode, Mohnish Pabrai talks about the similarity of Motors Bubble, Tronics Bubble and Dot Com Bubble, and the next bubble(?).


In this episode, you’ll learn:

  • Similarity of Motors Bubble, Tronics Bubble and Dot Com Bubble.

To check out all Collection: Mohnish Pabrai <click here>

[Transcript]

(Source: https://youtu.be/7F2IGzES7Uc)

MOHNISH PABRAI 00:00

So if you look at these three bubbles, you know the three bubbles are very similar to each other. The Motors Bubble, the Tronics Bubble and the Dot Com Bubble, each of them is about 38 to 40 years apart and the 38 to 40 years apart is not a coincidence.


The reason there are that far apart is because the set of investors that saw this bubble have to have exited the scene before the next bubble can takes place because then there's nobody to tell them that hey guys, you guys are smoking dope, you know this – we already – we seen this movie before.


And I remembered that when the internet bubble was going on, you know Buffett would talk a little bit of that time about the Motors and the Tronics bubble, but he was just drowned out.


In fact, most of the talk at that time was you know, kind of like what's wrong with you Warren? You're not in these stocks and Berkshire stock has dropped a lot and so on so forth.


So I would not be surprised, if the next one is in kind of the 2030(?) – 2036 to 2042 range. And you know, who knows what the theme is going to be then. It could be a transport companies taking people to Mars. (Laughter)


We don't know, we don't know what the – And you know if it is something like that, you know transport to the Moon or transport to Mars then all investors at the time are going to look at previous three bubbles and not see any similarity between these three and that one.


Because they're going to say this time is different, you know the last was different, we are getting a whole new planet, you know so we got a different set of things to worry about.


So most of you will very much be you know, I guess 40 something when the next one comes around. And you will know how to sidestep it or like Mark Cuban, you know hedge the heck out of it.

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