Mike Wilson, Morgan Stanley chief US equity strategist and CIO, talks about using gold as a defensive asset to protect your portfolio. He says gold has been in a bull market for 25 years.
He speaks with Bloomberg's Tom Keene and Scarlet Fu on "Bloomberg Money"
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What Michael Wilson said
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Michael Wilson, Chief U.S. Equity Strategist and CIO at Morgan Stanley, discussed the durability of the current bull market, attributing his firm's underestimated strength of the earnings recovery and the acceleration of AI capex. He noted that 2022 was uniquely challenging for retirees because stocks and bonds fell together, eliminating traditional hedges, and advocated for dollar-cost averaging and diversified portfolios. Wilson endorsed gold as a defensive asset rather than a yield instrument, suggesting reduced duration in fixed income for diversification. He observed a rotation through commodities, from gold and silver to rare earths, energy, and semiconductors, driven by Fed money printing. He praised retail investors for navigating inflation well, and recommended rebalancing, especially for those overexposed to large-cap growth stocks, noting that cash and mid-duration bonds now offer positive real returns.
Key takeaways
Wilson said Morgan Stanley underestimated the strength of the earnings recovery and the durability of AI capex.
Wilson advises reducing duration in fixed income while still maintaining some bond exposure for diversification.
He noted that 2022 was unique because stocks and bonds fell together, hurting 60/40 portfolios.
Wilson says many portfolios are unbalanced, tilted towards large-cap growth, and now is the time to rebalance and take profits.
0:56Do you feel like you do you feel like the market you've gotten the market right? Have you underestimated its durability?
1:27... in 2021-22 where are you brave enough to catch the falling knife when the market rolls over like that and my personal finance is troubled how do I get back into the market how at the margin do you buy when you see the sweat of that chart?
3:16Is there a way to get all your defense of your bond like exposure within equities?
4:14I mean was that just kind of a unique one-off period or can we return to things like that?
7:20What do you do to make sure that you don't you you're not overly loaded up on equities?
8:22Should they be looking at two and three-year Jim Karen like money?
Bloomberg Audio Studios podcasts radio news. Bloomberg Money from New York City. Scarlet Fu and Tom King. Thank you so much for being with us today. I mean this is what it's about folks. We get somebody in really really quite good, Scarlet, and they write a seven-page really really detailed paper. But what's it mean about my non-retirement?
I'm at triple leveraged all cash. That's a different story. We are honored to bring you Mike Wilson, pride of University of Michigan, chief US equity strategist and investment officer at a small shop, Morgan Stanley, this morning. How you doing? How's your year been?
No, I think we probably were the first ones to talk about this earnings recovery and even we underestimated the strength of it. So yes, we did underestimate the power of it, but directionally I think we were right on that. I think where we've been surprised is probably the durability of the AI capex and just just how much that has accelerated and how much quite frankly how much the market has been willing to absorb on the issuance credit.
Well, the reason you've been good at that is Jim Karen. It's got nothing to do with the equity side of the shop. Bring up the chart right now. This is the emotion. Many of you have forgotten this stocks. You can go down in stocks. It's a shock. Now, this chart ends in 2022, but there's XPX. It's wonderful. great, wonderful, COVID and all that and then there's a big rollover in 2021-22 where are you brave enough to catch the falling knife when the market rolls over like that and my personal finance is troubled how do I get back into the market how at the margin do you buy when you see the sweat of that chart?
Well the really challenging thing of 2022 as you know for retirees was that stocks and bonds went down for the first time in really our lifetime and that so there was no hedge. So even though the decline in equities wasn't as severe as it was in '08 or in '01 or '02, your 60/40 portfolio was down the same. So that was a change and that I think that was one of the things that made investors apprehensive to step in. It was like, holy smokes, I'm getting hit on both my defensive stuff and my offensive part of my portfolio. So I think people froze up. Now our job is to remind people that there's value at some point. And I would say we navigated the 2021 top extremely well and the 22 downturn. We probably overstayed our welcome a bit in 23 and got back on board in 24 under the under under the story that we're telling now. But like I mean as an in as a as a person who has their money in the market for retirement or long-term investor, you really should avoid being shaken out on both the top and the bottom. So in other words, chasing stocks is as damaging as selling stocks at the bottom in my view. So that's why we like dollar cost averaging. That's why we do like still like diversified portfolios. 22 was the challenge on that. It ended up working out for folks who stayed fully invested.
And for those who stay fully invested, they their faith in equities has been restored. Maybe for bonds, not as much given that the performance has not been as great. Is there a way to get all your defense of your bond like exposure within equities? I've heard some people talk about the idea of swearing off fixed income completely and perhaps owning insurance companies as proxies for bonds. You get the price appreciation, you get the dividend. It's kind of like a win-win.
Yeah. Well, what I would say is that these asset classes are now more closely correlated. So, they're just not going to offer that natural diversification benefit that they have historically. So, that means you need to do other things. So, there are other types of investments. You were mentioning earlier like gold or or maybe even Bitcoin or some of these things that can defend against inflation. So, we we we've been a very big advocate of gold not so much as a yielding instrument, but as a defensive asset. That doesn't mean you abandon fixed income, but it does mean you reduce your duration. So there are things you can do within your fixed income portfolio to make it more valuable, still provide some diversification benefit without taking too much risk on on the duration side.
So when you talk about gold, gold was acting like a meme stock at the beginning of this year. I mean was that just kind of a unique one-off period or can we return to things like that?
Well, I would say that gold has been in a bull market for 25 years. I mean people kind of woke up to this idea more recently at the beginning of the year and I this probably is a good place to kind of you know kind of gravitate to for the rest of the discussion for this year I would say we've had basically one big commodity rotation. So coming into this year you have to remember at the end of last year the Fed started printing money again right with this reserve management program and that led directly to gold and silver stocks taking off. Then we went into rare earth and metal stocks then energy stocks and then semiconductors. Now what do all those have in common? They're all commodities. Okay. So, it's kind of interesting to me that that's what's been going on and and that may be exactly what people are doing. They're looking for things that are not stocks but commodity like to offset, you know, the the risk they have in their portfolio with equity like risk.
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Wilson, M. (2026, August 14). Morgan Stanley's Mike Wilson Talks Gold, Markets | Bloomberg Talks [Interview transcript]. Bloomberg Podcasts. CEOInterviews.AI. https://ceointerviews.ai/interview/1205044/
MLA
Michael Wilson. "Morgan Stanley's Mike Wilson Talks Gold, Markets | Bloomberg Talks." Bloomberg Podcasts, 14 Aug. 2026. Transcript, CEOInterviews.AI, https://ceointerviews.ai/interview/1205044/.
BibTeX
@misc{wilson2026_1205044,
author = {Michael Wilson},
title = {Morgan Stanley's Mike Wilson Talks Gold, Markets | Bloomberg Talks},
howpublished = {Interview transcript, Bloomberg Podcasts. CEOInterviews.AI},
year = {2026},
month = {aug},
url = {https://ceointerviews.ai/interview/1205044/},
note = {Speaker-attributed transcript with timestamps}
}
