CNBC: Michael Landsberg: Diversify Portfolios Outside of the U.S. to Take Advantage of Strong Growth

October 25, 2024

Michael Landsberg, Chief Investment Officer of Landsberg Bennett Private Wealth Management, joined CNBC’s ‘The Exchange’ to discuss international investment opportunities, particularly in India and Japan. 

He expressed optimism about the growth prospects in these countries, highlighting India’s strong GDP growth and Japan’s recent economic reacceleration. 

Landsberg emphasized the importance of diversifying portfolios beyond the U.S., especially as some domestic valuations appear stretched. 

Additionally, he shared his views on how inflation could influence the Federal Reserve’s rate decisions and addressed the potential of AI to drive future growth in technology sectors.

Key Takeaways:

1. Global Growth Opportunities: Landsberg highlighted India and Japan as attractive markets for growth. “The GDP growth there [India] is two or three times what we’re getting here,” he noted, adding that India’s capitalist structure makes it more appealing than China. While Japan has lagged for years, he acknowledged a recent reacceleration but expressed caution due to political uncertainties. He recommended diversifying investments through positions such as being short on the yen, which can offer further risk management.
2. Diversification: Landsberg stressed the need for investors to diversify portfolios globally, especially as some U.S. market valuations are “priced to perfection.” He pointed to markets outside the U.S. — including Asia, South Africa, and the UK — as regions where growth opportunities remain untapped, and valuations are more reasonable.
3. Inflation Outlook and the Fed: He reiterated his stance that inflation might reaccelerate in the near future, keeping the Federal Reserve on the sidelines in 2025. “We’re entering a slower growth environment, but inflation is starting to peak back up,” Landsberg warned, suggesting that this dynamic may hinder aggressive rate cuts by the Fed.
4. Technology Sector Potential: Discussing the technology sector, Landsberg highlighted the potential for AI-driven growth but cautioned that it may take time for this to translate into measurable profits. He cited Adobe as an example of a company that has been unfairly penalized for not monetizing AI immediately, explaining, “Their AI program, Firefly, is still taking time to gain momentum, but it’s a good entry point for those looking for long-term value.”

Landsberg’s appearance on CNBC emphasized the importance of diversifying portfolios internationally to mitigate risks and capitalize on global economic growth, especially in high-growth markets like India and Japan. He also noted the potential inflationary challenges ahead, which could limit U.S. rate cuts, and discussed opportunities in the evolving AI landscape within the technology sector.