Episode 169 - Marks on the Markets: Bob Doll Checks in on His 2024 Predictions
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In this edition of Marks on the Markets, Richard and John are joined by Bob Doll, the newly appointed President and CEO of Crossmark and a staple in the Faith Driven Investing movement.
Each year, Bob outlines 10 market predictions for the coming months, and in this episode, he shares what he sees happening in 2024, how his predictions are looking after the first quarter, and how the election might affect the markets.
All opinions expressed on this podcast, including the team and guests, are solely their opinions. Host and guests may maintain positions in the companies and securities discussed. This podcast is for informational purposes only and should not be relied upon as specific investment advice for any individual or organization.
Episode Transcript
Transcription is done by an AI software. While technology is an incredible tool to automate this process, there will be misspellings and typos that might accompany it. Please keep that in mind as you work through it.
Richard Cunningham: You're listening to Fate Driven Investor, a podcast that highlights voices from a growing movement of Christ following investors who believe that God owns it all and cares deeply about the heart posture behind our stewardship. Thanks for listening.
Hey everyone! All opinions expressed on this podcast, including the team and guests, are solely their opinions. Host and guests may maintain positions in the companies of securities discussed, and this podcast is for informational purposes only and should not be relied upon as specific investment advice for any individual or organization. Thanks for listening.
Richard Cunningham: Well. Hello everyone, and welcome to another episode of the Faith Driven Investor Podcast. My name is Richard Cunningham. I have the joy of being on staff with Faith Driven Investor. And I'm your host today, joined, as always by one of our incredible mainstays in John Coleman, managing partner at Sovereign Capital. And John, if we're doing a marks on the markets episode, I couldn't think of someone better than newly appointed president and CEO of Crossmark Global Investments, Bob Doll, formerly the CIO of Crossmark for the last three years. Bob, I'm pretty sure you're supposed to be retired as of 2021, but here you are having quite a busy last three years. What a joy to have both of you on the show. How are we doing, gentlemen?
John Coleman: Man, I'm just excited to be here with Bob. I mean, he's someone I've known about for many years. Since my, since my last position in investment management had a lot of admiration for him over the years, the various firms he's worked at, and, of course, just one of the best guests on a podcast out there. Bob, you're on TV all the time. Everybody's looking for your insights. We're pretty fortunate to get him today. Thanks for coming on.
Bob Doll: Richard. And John. Thanks for those kind words. They're humbling because we know markets are the great equalizer. If people aren't, the markets certainly will, hit us across the face from time to time. So it's a thrill to be with you folks and share things as we find them at this moment. On the retirement bit, I was eligible for retirement, so took retirement, but had no intention of retiring. Making the decision to move to a faith based money manager was a joy. And since I've done that, I've looked in the mirror literally several times and saying, what took you so long? So it's been a joy.
John Coleman: Man. I feel the same way. Bob, you and I are in the same boat in that we spent most of our careers in kind of mainstream investment management organizations, and I'd say the last three, you and I came into this space about the same time. Actually, you came in just a bit after I did, I think. And, it's been the most fun three years of my career, so I'm glad to hear it's been the same for you.
Bob Doll: Sure has. It's as I know you will agree. Yes, it's a job and it's a career and it's investments, but it's a ministry as well. And that is part of the joy for sure.
Richard Cunningham: Awesome. Well, for just anyone who doesn't know Bob's background though, you can look it up and it is quite detailed. This is a guy who spent time at Blackrock, Merrill, Oppenheimer, Nuveen and then to kind of paint the story for you there as a listener. Bob retired in March of 2021, but then it didn't take long for him to join back up into the workforce with Crossmark Global Investments served as the chief investment officer for three years, and then now as the newly appointed CEO and president. Crossmark is a Houston, Texas based $6.2 billion asset manager investing out of the Stuart family of mutual funds across equity, fixed income, liquid alternatives and derivative income asset classes. And so it is some retirement you are enjoying, Bob, but what a joy to have you on the podcast. We are grateful the faith driven investor ecosystem is grateful. And so to kind of set today up because this is a marks in the markets episode. If you didn't know Bob Doll every year does this amazing thing where he releases ten predictions for the upcoming year. And so coming into 2024, Bob released these ten predictions he had for the markets and kind of the broader economy for 2024. And, Bob, if I'm not mistaken, before I get into reading off those predictions and you and John respond to those and we kind of have some kind of commentary now that we're one quarter into the year, what's the story behind those predictions? Am I not mistaken that these started like 30 years ago or something like that?
Bob Doll: Yeah, I've done them for at least 30 years. Richard. You know, a blog I had at the time was doing it, got tired of it and said, Bob, you want to try this. And I've been doing it ever since. I think among the things that have given us some credibility is every quarter we write up how we're doing and then get someone to score us at the end of the year. I don't change them during the year. I'm not a strategist like so. Side strategists change their mind and evolve over time, so we live with them all year long. We get some right, we get some wrong. And, hopefully we learn from them.
Richard Cunningham: I mean, that's awesome. I mean, you, John, and I all come from kind of the asset management space. So my respect and admiration that you do this is high because we know how leery compliance and marketing can be of predictions that get kind of put out there. And then you have to explain them. If they didn't go, you know, perfectly correct. How did 2023 go before we go into 2024?
Bob Doll: Not great. I tried my worst. I think it was the third time I got only five right. You know? So I despair of the year when I get three right. Three out of ten and, you know, come here. What Bob says about next year, that's not going to go over well. We've average. The good news is 72% over the many years we've been doing it. So the problem is we never know which seven out of ten we might get. Right. If we did know which ones, we could all make a bloody fortune. I guess.
Richard Cunningham: That's incredible. Well, I mean, it kind of reminds me, I think I'm in, like, the fifth percentile in my March Madness bracket. So as we record this, it's March 25th, Monday of Holy Week. This will be released after Easter in April. So I hope all of our listeners have a wonderful Easter celebration. But, you know, I'm down there in the March Madness rankings. But I believe these year's predictions and we'll show you just how astute Bob is. So I'm going to read off the ten predictions, and then we'll dive in letting you to kind of respond where you are first, kind of feeling compelled by. So here are Bob Doll's ten predictions for 2024. Number one, the US economy will experience a mild recession as the unemployment rate rises above 4.5%. Number two, the 2 to 3% inflation ceiling of the 2010 becomes the 2 to 3% inflation floor of the 2020s. Number three, the fed cuts rates fewer than six times suggested by the fed funds futures curve number four credit spreads widen as interest rates decline. Number five earnings growth falls short of the double digit percentage consensus expectation prediction number six stocks record a new all time high early in the year, but then experience a fade number seven. Energy financials and consumer staples outperform utilities, health care and real estate. Number eight. And this is a final one that will return to kind of Bob talking about his movement to a faith based asset manager. This is faith based share of industry AUM rises for the eighth year in a row. Number nine geopolitical crosscurrents multiply but have little impact on markets. And number ten the white House, Senate and House all switched parties come election time in November. So there are Bob Doll's ten predictions for 2024. Bob, as you hear that, what immediately kind of jumps out to you and allow you guys some time to just respond to those.
Bob Doll: Sure comes to my mind is the theme that envelops all these, and then I'll let John figure out which ones we want to go after. In particular, the theme is Goldilocks remains a fairy tale. What do we mean by that? Coming into the year and to some degree, still, the expectation by the consensus is that we're going to get double digit earnings growth. That is, the economy is going to be good and earnings are going to grow nearly double the normal rate. But on the other hand, and at the same time, inflation is going to continue to fall and the Fed's going to cut rates. At the start of the year, the expectation was six times. Our view is one side or the other or both get disappointed. Goldilocks remains a fairy tale. Or you can have your cake and eat it too. That's the theme for these predictions that caused us since the beginning of the year and still now to be cautious. Not bearish, but cautious. We are in a momentum driven bull market, and predicting the end of the momentum is a fool's game and therefore you ride the momentum. But you have, you know, short leash on the market or stops not too far below the market should, in fact, the high risks associated with PE ratios of 21.5 times be a concern for the market, which I think they will become at some point. So that's the broad panoply of this, set of predictions.
John Coleman: Yeah. You know, as I think about that, Bob, if I think about my own position at the beginning of last year, I was probably a bit too pessimistic. I thought going into last year, the chances of recession were much higher. I thought the fundamentals of the economy were likely to deteriorate in a more substantial way. I didn't think we'd hold as strong as we have, honestly, and I certainly didn't predict that markets would rebound in quite the way that they did. Obviously a lot driven by the Magnificent Seven. And we've seen technology trends and we can come to that. Now it does feel like markets are potentially overshooting a little bit, or getting too optimistic that there is a little bit of a Goldilocks syndrome. And what I'm wondering is, you know, is the fundamental economy able to continue to chart a relatively positive course this year? Maybe not in line with the expectations that you're mentioning, but at least continuing positive momentum. And there I tend to maybe have, maybe chastened by last year or more optimistic view, which is it doesn't seem like we're going to have a serious recession. You mentioned a mild recession here, and maybe that's a place to dive in. It doesn't seem like we're going to have to dramatically raise rates anymore, although I am skeptical that we're even going to be able to lower them at all, potentially the Federal Reserve. And so maybe as we dive into this, Bob, let's start with the fundamentals of the economy. You're predicting kind of a mild recession with unemployment rising, which is not where we are right now. I think we're effectively below frictional unemployment right now, are below what you would predict for frictional unemployment. How do you see that beginning to kick in? And are there any early warning signs that that might materialize?
Bob Doll: Yeah. First of all, 4.5% inflation, as you know, is still a very low number. In fact, in the slides I used to back this up, I show long term unemployment rates. And four and a half is barely above.
John Coleman: Right. That's right.
Bob Doll: As you, both probably know, when inflation has moved up one half of 1%, 5/10 following that has always led to a recession. We're up 4/10. So there's not much room left. Of course we can break the rule. Nobody sets their rules in the economy, in the markets. But you ask, what signs are we seeing? The unemployment rate has ticked up modestly. I think we will see more of that. I would point out, while the government measures lots of things, one of the things that they do not measure well is people working multiple jobs. Yeah, a lot of people that were working three jobs and believe it or not, they're a bunch of people are only working two now. Many are working, two are only working one now, not because they've chosen to, but because the job is not available to them anymore. And what I would add to your good question is the bifurcation we're seeing in the economy and with the consumer. High end consumers are doing just fine. They're loving life. Stock markets up a bunch, their home prices up a bunch. And, you know, taking money off the table in those areas to live if they need to, which most of them don't is quite good. Lower level consumers clearly struggling. Their Covid money is gone and there's evidence they're upping their credit card balances to live. And recently in the last month, evidence that they're taking money out of their 401 case with a tax penalty in order to live. So, again, I don't want to be a bear on the economy, but I think there are increasing number of signs. Maybe I add this, John, if I might. Most people, myself included, expected a recession last year begging the question why didn't a recession happen? Yeah, I think there's several answers one, most of us. I know I did. Underestimated how much the Covid cash kept the economy going. That is money that hiring consumers accumulated because they were in their pajamas for four months and didn't go out and spend money, or at the other end of the spectrum, got a lot of checks from the government. Took a while to spend those. Second reason is even post the Covid stimulus. Last year, the government put a lot of money into the economy, more than most of us thought. And thirdly, and this is the one I'm still researching. Private credit. Private credit exploded kind of from a decade ago, almost 0 to $2 trillion in half that expansion in the last two years. Those three things provided so much cash for our economy. That's mainly why we didn't have recession. So yeah, we're going to get a recession this year. Yeah. Who knows. I do think we will get a slowdown, perhaps a noticeable slowdown that will cause this double digit earnings expectation not to make it.
John Coleman: Well, and I think just in terms of the unemployment rate, Bob. And check me if you think this is wrong. I do think some of the deflation in in the unemployment rate or at coming down was related to a decline in labor force participation during Covid as well. And all of the trends that you just highlighted would lead us to believe that that will begin to take up again. People are burning through savings. They're having to live more on credit. Those who left the workforce are getting impacted by higher prices and by inflation and by a real affordability crisis, not just an inflationary crisis, but in things like housing, you know, a real affordability crisis spurred by continued constraints in supply. And so it does feel like more people are going to get back in the workforce. Fewer people are going to be dropping out of the workforce. And unemployment is likely to increase, at least because of that. In addition to the idea that there may be some frictions in the economy spurred by artificial intelligence or by firms continuing to cut their workforces to kind of lean up for potential troubles that could cause that number to rise.
Bob Doll: I fully agree with all of your points. There are good points to me, and underscoring what you just said is a bigger picture thought Covid has stressed and strained normal relationships. So economists have really struggled because the rule book does not include a pandemic and the experience pattern. So it's really difficult to understand sometimes what these relationships are and what they have done and what they might do.
Richard Cunningham: Up in real quick. Bob, one of the predictions is prediction number six. Stocks record a new all time high earlier in the year, but then experience a fade. We are once again recording this at the end of Q1 2024. Has that checked out? Too early to tell to my knowledge, feels like things have been marching on and everyone's kind of sitting there. As you guys have alluded to, scratching their head at the momentum that's at play.
Bob Doll: Yeah. You know, the jury's still out. We don't know if the stock market continues straight up for the rest of the year. We'll have to mark this one wrong. But my guess is at some point here in the first half, our guess might have been the first quarter, although we didn't state that explicitly. We see a high for the year and then a fade. And it doesn't mean a big bear market necessarily. And I come back to earnings probably aren't going to make the double digit percentage gain. And we've already moved from six down to three expected fed cuts. And some people now are moving to two. And they're even some people say we're not going to get any and all of that for a PE of 21.5 times, you know, if the PE was 15 or 16 or 17, I might say that's okay. But when PEs are, you know, in the 20s, I'm an old man. I've only seen PEs over 20 - 3 times. Tech bubble, Covid and now and the first two times the outcome wasn't pretty. Let's hope it's different this time. But valuation when it's this high demands almost perfection and we don't have perfection. There are a lot of flies in the ointment.
John Coleman: Can we talk about. I do want to circle back to this idea of the interest rates and inflation in a moment, because I think, you know, that's an important topic to touch on. But one of the things we're monitoring. If you go one click below in the market right now is this divergence between the Mega-cap stocks, especially the Mega-cap technology stocks and small cap and mid-cap stocks. And you mentioned this price to earnings ratio at 21.5, I think was what you were talking about. And obviously that's substantially higher for some of the Magnificent Seven or those that have been driving markets right now. For those not as familiar. There's a group of stocks that people refer to as The Magnificent Seven lately, which is almost always a harbinger of doom. I think when you get a label like that, but includes firms like Nvidia, meta, Apple, Amazon, these big technology players that have rapidly grown, that people view as safe technology stocks with really strong earnings and revenue that have been almost all of the upside performance of the S&P 500 from an asset weighted perspective recently. And those mega caps have diverged quite substantially from the small and mid-cap stocks. What's your perspective on that and how sustainable is that? I know on our side, we've been predicting that small and mid-cap have to make up some of that difference at some point, seeing that there has to be more of a return to norm. But these mega caps keep running. What are you seeing right there? What do you think might happen?
Bob Doll: You know, several observations. First of all, November, December when we got the big fed says I'm done quote unquote rally. We got a good broadening in the market and down cap or equally weighted portfolios or small cap certainly did better than we come into the new year. And it fades again. So we're having this tug of war of late last few weeks. Small is doing a little bit better again. I agree with you. For the market to be sustained to the upside, we need more broadening, which we very well might get. And where I thought you were going, and worth pointing out, is the PE of the 493 in the S&P, those seven is lower, noticeably lower, but still not low. And that reminds you when people bring that up is you know, the stock market is always cheap. If you take whatever the bubble is out of the bull market, you know, he will do that all the time. So I tend to look at the overall and then understand the differences inside. To The Magnificent Seven. John, we've obviously seen some splintering. Tesla has been an awful stock. It's had some fundamental problems and some valuation compression. And my guess there's more to come. Apple Amazon. Those stocks have flagged a bit. They've broken some technical uptrend lines etc. so it's no longer monolithic as it was for much of last year for the Magnificent Seven, which I think is healthy for the market, meaning we need that broadening to take place. So I think that, look, technology and AI is certainly among the reasons the stock market has done well. It is among the reasons bulls on the economy think it will do well. And look, AI is making a difference. It will continue to make a difference. But I wonder a bit if the stock market's not overdone that theme.
John Coleman: You know, maybe we could touch on this topic of interest rates and inflation really quickly because inflation has come down, although it remains persistent. And the history of inflation tells us it's always more persistent than we think it will be, or it's almost always more persistent than we think it will be. And count me among those who thinks the likelihood that we don't get an interest rate decrease this year is pretty high, that actually the fed has to maintain rates, I don't know that they'll have to raise them, but they'll have to maintain them. And the only thing that causes me to question that a little bit is the possibility of political pressure headed into an election season where the fed will be under enormous pressure to keep the economy humming, rather than allowing it to slip into a recession because of the electoral process. Say, a little bit more just about what you think will factor into the Fed's decision of whether to raise or cut rates or hold them steady, and whether you think inflation is actually kind of stamped out now, although it may stay a little bit higher or whether there's real danger.
Bob Doll: So let's put some numbers on it. As we all know, headline inflation got to 9%, core inflation to about six. Let's stick with core inflation. Core inflation has come from six to just under four. Remember the Fed's target is 2. It's a lot easier to get inflation from 6 to 4 down two points than it is 4 to 2. Two more points. So I like you, John. I'm dubious. I don't think we're going to get to 2% inflation. If we do, we will be in a recession. Now, can it go a bit lower? We've just had two months of disappointing inflation numbers. Many economists argue that that would happen. And maybe that's ending. And now we'll begin a downdrift again. And I'm in that school. But I think we're not going to get below three. And look is there a big difference for two and three for interest rates and PE ratio. You bet there is for the economy to some degree. It will the fed get it to three and wave a checkered flag and say yeah it's close enough. That's not out of the question. You know the dual mandate is firmly in their mind. Keep inflation under control and watch the unemployment rate. So like you sounds like doubtful. We're going to have many if any cuts this year. The fed would love to cut rates for a whole bunch of reasons. And with foreign central banks beginning to cut rates, the pressure will be more from that on the fed than it will be from the politics of the U.S. election, in my view. So fed funds rate probably a little lower at the end of the year, but not much.
Richard Cunningham: What about looking at things like geopolitical crosscurrents? You know, we've seen, you know, a pretty devastating headline in Russia. And what could that result in, in terms of just tensions and disputes kind of in foreign markets? What does that looked like in terms of what's going on here in our local economy, but also on a global level?
Bob Doll: It seems like every time you make a list of geopolitical issues, every 2 or 3 months, it gets a little longer. So why is that happen? My thesis is because the U.S. has lost hegemony. My analogy, is like way back when when you went out at 10:00 in the morning for school recess, you had 15 minutes to go play on the playground. It was the three of us. And John's the big guy, the bully. We hold back a little bit from our misbehavior, because we're just a little worried about how this bully might react. Conversely, when there's no bully on the playground, everybody does what they feel like. And that's where we are. The world is a messy place. And yo, Russia of late. And where did that come from in the U.S.? Warns Russia? I mean, it's just an amazing and complicated world. So I think that list will continue to grow. And so far it's not affected markets any way at all. A lot of the reasons, because the guts of the economy has not been touched. Take the Middle East. People said, oh, conflagration in the Middle East. Oil prices are going to go through the roof and the economy is going. That didn't happen. And it doesn't mean it won't happen at some point. But most of these things have been contained not to affect the economy of the world, and therefore markets have been fine.
John Coleman: Yeah. You know, I think this is super fascinating, actually, because we've had these two proof points in the Russian invasion of Ukraine as well as in the war in Israel, obviously, the terrorist attack in Israel and then the war in Gaza. And they have been contained to those regions. Right. By and large, I mean, there have been some impacts. Part of that is I think world energy markets are a bit more stable, especially with the US energy output being so high right now. I would say the one conflict I think that could throw the international markets into more disarray would be if something happened with China and Taiwan. I don't believe there's an incredibly high chance of that. But because of the Taiwanese centrality to processors at the moment, because of the role those play in artificial intelligence and in a lot of the other operations that we'd see. And to your point, the US losing hegemony, we really live in a bipolar world right now between China and the United States. I think Russia is a player. You know, there are other players, but if you think it's superpowers, it's really the United States and China at the moment. Absent that, I think I agree with you. I don't think these international conflicts, unless something super dramatic happens, are likely to play a role. I do want to get your thoughts on domestic politics, because obviously that tends to have a much bigger role in markets. I'm interested in the switch parties comment because we have a one seat Republican majority in the House right now. That obviously could be expanded in November. It could switch. We've got a strange white House race right now where there's broad dissatisfaction with both major candidates, honestly, particularly because of the age issue. And the Senate, structurally, is the one that looks a bit more straightforward in that it's a friendlier GOP map than Democratic map right now, just in terms of the states and the seats that are coming up. Talk to us a little bit more about your prediction that all parties switch in November. I'm interested. Does that mean you think it'll be a Democratic House and a Republican White House and Senate, or is it a is it a broad based Republican? And what's driving that? What impact do you think that will have on markets if that materializes?
Bob Doll: Yes, I think we'll wake up in November after the election. Republican president, Republican, Senate, Democratic House, all three switching. And that's not just, you know, reaching into the air. Nine of the last ten elections in the U.S., we have booted out the incumbents. That kind of string has not happened since after reconstruction, which is a long time ago. We are in the mood in this country that whoever is in the chair. I don't like him or her. I'll take the other guy, the challenger. And so we're booting regularly those folks out. Yes. You have to right the Senate. Given the GOP friendliness, I would put 70% chance that the Republicans take the Senate, maybe 75. The House and the white House are obviously much more difficult. I think with the number of Republicans retiring and being frustrated with the operations in the House, some of the demographics, etc., I think it's, you know, 55, 60 that the Democrats take the House, the white House. Obviously, you use the word strange election. That's one word I can think of. A bunch of others do. It's a crazy world in which we live. And nobody wants either guy. You're absolutely right. Look, if anybody strong or medium was running against, I'm going to use the phrase a doddery old man who has trouble finishing sentences and has a record on a lot of things that are suspect. You'd think that guy would be winning in a landslide, but not the case because Donald Trump has his problems just like Joe Biden does. So this probably goes down to the wire back, connecting this to the last subject about geopolitical things. Donald Trump has made it clear that if he gets elected, he's going to put a 60% tariff on Chinese goods. That. It's like a massive tax increase to Americans. And I think that could exasperate the domestic economy, not to mention the geopolitical issues that would come from that. So keep your eye on this space.
John Coleman: Well, and I'll make one prediction that's not on your list. That's just perpetually on my mind. And then Richard can get us back on track with additional predictions. I actually think there's substantially more weakness in China right now than people believe. I've been in China bear for some time, and part of that's just a structural conviction that it's nearly impossible to have a dynamic economy or political system as restrictive as China's. They've tried to split the difference in having more of a free market approach to the economic system, with more of a totalitarian political system. And I just think that leads to a lot of stasis in the way in which resources get distributed in autocracies means that they're much more fragile than we think. And I think there have been some early warning signs that the Chinese economy and political system is weaker than we think. Obviously, data is difficult to trust. That comes out of China at the moment. But if I had one prediction this year, I'd say over the next 12 to 18 months, I wouldn't be surprised if real substantive weakness in the Chinese economic and political system begins to leak out. And then the way in which that manifests in the broader world, whether that's hostility towards Taiwan, whether it's domestic political turmoil, I'm not exactly sure, but I wouldn't be surprised if we start to see that soon. Given what I think are some headwinds that the Chinese economy is facing.
Bob Doll: Richard, let's add that is prediction 11. I agree with John. I'd, I just add two points. One, short term or this could last for a while is the real estate problem. Yeah. There's too many 100 plus story buildings in China that nobody's living in, and they're financed on debt. I mean, how do you square that circle? And then the long term demographic problem. Demographers argue that China's population at the end of this century is likely to be about half what it is today. Hard to fathom. You know, the one birth policy, even though it doesn't exist anymore, has become a way of life. So the Chinese folks fewer get married when they do. It's later in life. Many of them have no kids. If they do, it's one. If you have two, you have a big family. Crazy.
Richard Cunningham: Well, John Coleman, let the record show you made the Bob Doll 2024 predictions [.....]
Richard Cunningham: Well, gents, I want to. First off, a blast to hear you guys riff on all of this. I want to close here because, Bob, you've got this really compelling prediction number eight. And that is faith based share of industry. AUM rises for the eighth year in a row. So first off, I think it'd be fun to hear you kind of. Paint the picture of how that prediction is created, what we're measuring like, you know, kind of what's the baseline, what specific industry AUM is it just public markets, as you know, include private markets and things like that? I mean, just talk about kind of that trend we're seeing in this faith based space that all of us are really passionate about.
Bob Doll: Yeah. It's curious that folks that ask about this are not just people of faith. I have a lot of people go through these predictions and that's where they go. Tell me about this one. So depending on who you talk to, most argue that faith based money management is 40 to $50 billion, which is a tiny little speck in the overall asset management industry. So we are part of a very small industry. But when you look at the market share of that total, well, it's a very low number. It has grown seven years in a row. So the prediction is based on the fact that I observe more. And you guys, do too more and more people and institutions wanting to line up their investments with their beliefs, whether they're faith based or not. And, that cause I think getting this one right is going to be like shooting fish in a barrel. I think this will continue to grow. And I think part of our collective opportunity and you both know this is education. A lot of people are not aware that this little sliver of the money management industry even exists. And when they do, light bulbs go on. In my three short years at Crossmark, one of my biggest surprises is a how much education we have to do of strong faith based people, and b how many non faith based people are willing to do business with us. And when I ask why, they say something to the effect that, you're good people, we've been watching you. We trust you. Would you manage our money? Which is just a real joy and an opportunity and frankly, a mission field.
John Coleman: Yeah, what I add to that. So I think we're both a little bit biased here, Bob. So it's always, challenging to make predictions where you're heavily incented on one side of the prediction. But I do think you're right. I mean, I've been really encouraged. The growth over the last few years has been extraordinary. I think there's more interest than ever in taking a hard look at the values of investments, partially because there's been this reaction against a relatively monolithic set of values that had been a part of the industry that people are now questioning, and they're taking a look at how their providers match up with that and whether they really reflect their values. So it's just putting a ton of money in motion. And the faith based share of the marketplace is so small that there's almost unlimited amount of upside right now to that asset growth. So I think all that works in the favor of growth in this faith based market. I think the other component of that is just the number of quality providers or the supply of faith based asset management that's out there right now. I know Richard and colleagues at Faith Driven Investor have been central to trying to encourage people to get in the game, to try and get really good people in the game. And frankly, I think the more people like Bob Doll we have come over, the more that that increases the credibility of this space. I mean, you were a legend in your own right in the mainstream world, and the fact that you've contributed your talents and time to the faith driven world, I think, is exactly what we need across the board in multiple asset classes to just increase the quality and the reputation of the space. And the more that we have that, the more the supply improves, the more incredibly talented people move over to try and make this a priority in their own work. I think inevitably people will be drawn to the space and hopefully the performance of the space will warrant continued growth.
Bob Doll: Fully agree. And you folks have faith driven investors. Sovereigns capital more generally have been to contribute to that as well. You've educated people, you've brought people together, and we just need to continue to do that because, together we can grow the pie separately, will sub optimize our individual and collective opportunity.
Richard Cunningham: Man, that's really well said. Yeah. There's a lot of pie out there as John, you were alluding to. And so let's not get so siloed in kind of our own individual lanes that we're running in and just remind ourselves that, man, this is kingdom purposes here. What an opportunity. What a privilege. All right, Bob, let's close with this. One of the questions we love to ask. And I'm sure we've asked that before, as I believe this is your third ever official FDI podcast appearance is just man, we've covered a lot of ground here, a lot of it, you know, rightfully sober minded in terms of just what's happening across markets and across the world, but maybe share a little bit of encouragement with us in terms of what's God has been teaching you personally, just whether it be in your work, in your quiet times with him, that's folks. Tune into this post Easter. What encouragement might Bob Doll share about what the Lord's been teaching him lately in his word?
Bob Doll: You prompted me on this, so I thought for a bit. And the simple but profound concept of God's sovereignty struck me. It's been ringing in my mind, in my heart, in my devotional life. My job, as you pointed out, the front end. You know I have more responsibility than I intended, asked for or wanted. God had a different plan. Family. We have three kids. Two walking with the Lord. One not the one that's not having professed faith and a lot of fruit earlier in life, but walked away and my wife renewal time. Bob stopped trying to be God. God is sovereign. He knows what he's doing and personally the same thing day by day. So that leads to greater peace, greater joy, which comes out of the peace and contentment that the day by day. He knows the future, and we just need to attempt to understand and walk in his will. And then God's sovereignty just rings loud and clear.
Richard Cunningham: Amen. Well, friends, thank you so much for tuning in. This has been Bob Doll on a marks on the markets Faith Driven Investor podcast episode. Bob, what a joy and a privilege to have you on. Thank you for your incredible work, John. As always, thank you for being such a key part of this show. And friends, we'll catch you next time.