Five Good Questions Podcast

Edward Chancellor is a financial historian, journalist and investment strategist.  In 2008, he joined GMO’s asset allocation team.  He graduated from Trinity College, Cambridge with first class honours in Modern History, and from St Antony's College, Oxford with a Masters of Philosophy in Modern History.  He is a former deputy US editor for Breakingviews.com, and worked for Lazard Brothers in the early 1990s.  Edward is the author of Capital Account, Devil Take the Hindmost, and Capital Returns.  Let’s start with the basics: what is the Capital Cycle theory?  I’d seen it explained in different ways over the years, but never this clearly and obviously.  I feel kind of dumb for not understanding sooner the seemingly larger investment implications of this theory.     What’s a real life example that most clearly illustrates a successful investment using the Capital Cycle theory framework?  Additionally, what do you make of the game theory aspects of individual companies faced with competition over-investing in t