Scott Colbert – The Contrarian Investor Podcast

Season 3, Episode 14: Quick Call on Fed Meeting and Economic Outlook

Published June 15, 2021

With Scott Colbert, Chief Economist, Commerce Trust Company

Scott Colbert, chief economist at Commerce Trust Company in St. Louis, rejoins the Contrarian Investor Podcast to discuss the upcoming Federal Reserve meeting and state of the economy.

This was a quick call recorded over a phone line on Tuesday, June 15.

Content Highlights:

The Fed meeting that concludes June 16 and the coming discussion around the rolldown of QE (0:52);
Colbert’s reasons for being “grossly optimistic” about the economy (3:43);
The biggest concern is around the length of the current expansion (5:04);
The prospects of asset bubbles and why the ‘dot plot’ should see an increase from four to six or seven members of the FOMC who want to see higher interest rates (7:37);
Where does all this leave investors? (11:06);
What is driving the drop in bond yields (14:41);

Not intended as investment advice.

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Contrarian Calls, Revisited: Biden Victory and the ‘Rotation to Value’

Published March 30, 2021

Scott Colbert, chief economist at Commerce Trust Company, on the eve of last November’s presidential election predicted a ‘blue wave’ followed by a rotation into value stocks.

“The Democratic turnout is going to be much larger than it was, and that’s enough right there to carry most of those swing states back to the Democratic side,” Colbert said last Oct. 28. “You’re not going to have enough pro-Trump voters to offset that Democratic wave.”

This would lead to “Democrats rolling this thing” and taking back the Senate as well as the White House. The biggest change for markets would be a rotation from growth to value. “It’s the combination of the election and a vaccine,” Colbert said.

Corporate America would be punished in the terms of higher tax rates, which would affect growth companies more than any other segment of the market. This would make growth stocks less appealing to investors. Value stocks would benefit from this development.

“If you’re looking for a contrarian play, I think it’s the rotation to value,” Colbert said.

Season 2, Episode 33: Watch for ‘Blue Wave,’ Followed by Rotation Into Value Stocks

Published November 1, 2020

With Scott Colbert, chief economist, Commerce Trust Company

Scott Colbert, chief economist at Commerce Trust Company in St. Louis, rejoins the Contrarian Investor Podcast to discuss the state of the economy on the eve of the 2020 U.S. presidential election.

In Colbert’s view, the economic recovery is “square root” shaped, with a quick bounce from the bottom followed by “the lazy L that comes after the easy V-part.” Politically, he anticipates a Biden victory and return of the Senate to democratic control. This will eventually lead to a higher tax rate for corporations, which together with a coronavirus vaccine will cause a rotation into value stocks.