1 00:00:02,720 --> 00:00:10,320 Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News. Hello and welcome to 2 00:00:10,360 --> 00:00:13,280 Speaker 1: The Money Stuff Podcast. You're a weekly podcast where we 3 00:00:13,320 --> 00:00:18,080 Speaker 1: talk about stuff related to money. I'm Matt Levin and 4 00:00:18,120 --> 00:00:20,439 Speaker 1: I write The Money Stuff COLMN for Bloomberg Opinion. 5 00:00:20,800 --> 00:00:23,400 Speaker 2: And I'm Katie Greifeld, a reporter for Bloomberg News and 6 00:00:23,440 --> 00:00:25,079 Speaker 2: an anchor for Bloomberg Television. 7 00:00:26,360 --> 00:00:29,920 Speaker 1: Katy, you know what my man career aspiration is, tell 8 00:00:29,960 --> 00:00:31,760 Speaker 1: me still lose a billion. 9 00:00:31,480 --> 00:00:34,240 Speaker 3: Dollars and come out better for it. 10 00:00:34,320 --> 00:00:38,800 Speaker 1: Well you can't not. Yeah, well it's not the best 11 00:00:38,840 --> 00:00:42,199 Speaker 1: possible career move. But up there, surprisingly I up there 12 00:00:42,200 --> 00:00:43,800 Speaker 1: on the list of career moves that you can make 13 00:00:44,120 --> 00:00:46,080 Speaker 1: is losing a billion dollars if you're a hedge fund 14 00:00:46,080 --> 00:00:49,000 Speaker 1: trader or bank trader, because like, there's just got to 15 00:00:49,040 --> 00:00:52,720 Speaker 1: be something special about you. If you use a billion dollars, well. 16 00:00:52,360 --> 00:00:55,680 Speaker 3: You know what I always say, A wounded lion is 17 00:00:55,760 --> 00:00:56,520 Speaker 3: still a lion. 18 00:01:00,160 --> 00:01:03,880 Speaker 1: So The Shank Kumar has a great story about how 19 00:01:04,160 --> 00:01:07,600 Speaker 1: hedgehund traders who lose money are in high demand and 20 00:01:07,680 --> 00:01:10,800 Speaker 1: hopping among multi strategy hedgehunds, and it does feature a 21 00:01:10,840 --> 00:01:13,959 Speaker 1: quote from a hedgehund re creator named Jason Kennedy who 22 00:01:14,000 --> 00:01:17,480 Speaker 1: says even a wounded lion is still a lion, and 23 00:01:17,520 --> 00:01:20,680 Speaker 1: the lion isn't mortally wounded, he will heal, and when 24 00:01:20,680 --> 00:01:24,199 Speaker 1: he's fully back, that lion is worth a lot more money. 25 00:01:24,520 --> 00:01:25,200 Speaker 4: I do love it. 26 00:01:25,240 --> 00:01:27,480 Speaker 1: Like by the end of the metaphrase like also there's money, 27 00:01:27,680 --> 00:01:27,959 Speaker 1: He's like. 28 00:01:27,959 --> 00:01:30,200 Speaker 2: Wait, let me tie this back into what we're talking about. 29 00:01:30,520 --> 00:01:32,800 Speaker 2: That's an incredible quote. Sometimes you read an article and 30 00:01:32,840 --> 00:01:34,960 Speaker 2: you come across a passage that just makes you pause. 31 00:01:35,480 --> 00:01:36,240 Speaker 3: That was this for me. 32 00:01:36,400 --> 00:01:38,920 Speaker 2: Yes, I would definitely rather be a wounded lion than 33 00:01:39,160 --> 00:01:44,480 Speaker 2: a beaten mule, which is a callback to our mailback episode. 34 00:01:43,680 --> 00:01:45,119 Speaker 1: I'm the title of our episode. 35 00:01:45,240 --> 00:01:48,680 Speaker 2: Jason Kennedy has a very optimistic take on this, that 36 00:01:49,520 --> 00:01:52,440 Speaker 2: the lion will heal. Sometimes lions do get wounded and 37 00:01:52,480 --> 00:01:54,320 Speaker 2: then they just die or they're never the same. 38 00:01:55,320 --> 00:01:57,840 Speaker 1: I grew up in sort of an efficient markets world. 39 00:01:58,160 --> 00:02:01,880 Speaker 1: I find it fascinating how quaint confident people are that 40 00:02:02,320 --> 00:02:07,040 Speaker 1: they can identify investing skill. Clearly, people believe it and 41 00:02:07,120 --> 00:02:08,239 Speaker 1: like they have good reason to believe it. 42 00:02:08,320 --> 00:02:08,440 Speaker 4: Right. 43 00:02:08,440 --> 00:02:11,320 Speaker 1: These are like large, successful firms that for many years 44 00:02:11,560 --> 00:02:15,200 Speaker 1: produce good returns, but just fascinating to me that you 45 00:02:15,240 --> 00:02:17,160 Speaker 1: can be like, Wow, this guy who lost a billion dollars, 46 00:02:17,200 --> 00:02:20,120 Speaker 1: he's great, he's so skilled. You know, we'll get him 47 00:02:20,160 --> 00:02:21,640 Speaker 1: on the on the downswing. 48 00:02:21,200 --> 00:02:22,240 Speaker 3: And get him at a discount. 49 00:02:22,320 --> 00:02:24,840 Speaker 1: Yeah, we'll get him at a discount and it'll be great, right, Yeah, 50 00:02:25,080 --> 00:02:27,640 Speaker 1: as opposed to like the regime has changed, or he 51 00:02:27,720 --> 00:02:30,640 Speaker 1: was lucky before or something, and now he's not a 52 00:02:30,680 --> 00:02:32,760 Speaker 1: winded line. He's just the guy who loses money. 53 00:02:32,880 --> 00:02:33,679 Speaker 3: He's a gazelle. 54 00:02:34,440 --> 00:02:38,560 Speaker 2: So there's a lot of recent examples of this happening, basically, 55 00:02:38,800 --> 00:02:43,560 Speaker 2: these battered former stars getting picked up, perhaps at a discount. 56 00:02:44,040 --> 00:02:46,600 Speaker 3: I was struggling to find a success story. It felt 57 00:02:46,639 --> 00:02:47,720 Speaker 3: like this article. 58 00:02:47,680 --> 00:02:50,119 Speaker 2: Named a lot of bad examples or how this could 59 00:02:50,200 --> 00:02:52,600 Speaker 2: go wrong. I wonder if this ever works out. 60 00:02:52,760 --> 00:02:54,480 Speaker 1: It's weird, like you probably don't hear about the ones 61 00:02:54,520 --> 00:02:57,640 Speaker 1: that work out, because like they're not going around bragging 62 00:02:57,680 --> 00:02:59,000 Speaker 1: about how they lost a lot of money at their 63 00:02:59,040 --> 00:02:59,720 Speaker 1: previous firms. 64 00:03:00,000 --> 00:03:01,200 Speaker 3: They're back to just being lions. 65 00:03:01,600 --> 00:03:06,200 Speaker 1: They're back to just being lions. But right, the other 66 00:03:06,280 --> 00:03:09,680 Speaker 1: thing is that this has always been a thing that happens, Like, yeah, 67 00:03:09,680 --> 00:03:11,920 Speaker 1: it is definitely there's been an uptick in it recently, 68 00:03:12,000 --> 00:03:14,720 Speaker 1: just because there's been such a talent war among the 69 00:03:14,760 --> 00:03:17,280 Speaker 1: big multi strategy hedge funds, and so there are all 70 00:03:17,280 --> 00:03:20,120 Speaker 1: these people on very large compensation packages that are moving 71 00:03:20,120 --> 00:03:23,520 Speaker 1: around between these firms. And if you run these firms, 72 00:03:24,320 --> 00:03:28,240 Speaker 1: the people you can pick off from your competitors are 73 00:03:28,240 --> 00:03:31,480 Speaker 1: often the people who have lost money. That's partly because 74 00:03:31,520 --> 00:03:34,160 Speaker 1: like they're out of favor or whatever. Some of them, 75 00:03:34,200 --> 00:03:36,920 Speaker 1: you know, potentially been fired, right because like traditionally these firms, 76 00:03:37,000 --> 00:03:38,520 Speaker 1: if you have a big draw down, you get fired. 77 00:03:38,560 --> 00:03:41,600 Speaker 1: Although the article mentions some of these people are stars 78 00:03:41,600 --> 00:03:43,320 Speaker 1: who like that doesn't happen to like they have a 79 00:03:43,320 --> 00:03:44,920 Speaker 1: big draw down and it's like, oh, it's okay, you 80 00:03:44,920 --> 00:03:47,080 Speaker 1: can stay here, but they get picked off anyway. The 81 00:03:47,120 --> 00:03:50,520 Speaker 1: other reason they're attractive is because they have to leave. Like, 82 00:03:50,560 --> 00:03:53,680 Speaker 1: if you lose money, even if you don't get fired, 83 00:03:54,200 --> 00:03:56,680 Speaker 1: you're now like below your high water mark, and so 84 00:03:56,720 --> 00:03:58,520 Speaker 1: you have to earn back all the money you lost 85 00:03:58,560 --> 00:04:00,720 Speaker 1: before you can get a big bonus again, you know, 86 00:04:00,800 --> 00:04:04,320 Speaker 1: more or less traditionally, and so if that's the case, 87 00:04:04,360 --> 00:04:06,600 Speaker 1: it's very tempting to quit and started a new firm 88 00:04:06,600 --> 00:04:08,760 Speaker 1: where your high water mark is resent back to zero. 89 00:04:09,000 --> 00:04:11,040 Speaker 3: Yeah, you're not in the penalty box. 90 00:04:11,440 --> 00:04:14,800 Speaker 1: Yeah, and you know, the article points out that it's 91 00:04:14,800 --> 00:04:17,479 Speaker 1: not great for investors, like particularly if you're in multiple firms, 92 00:04:17,600 --> 00:04:19,839 Speaker 1: like and people are just moving around to like reset 93 00:04:19,880 --> 00:04:21,840 Speaker 1: their high watermarks, Like you're not getting the benefit of 94 00:04:21,880 --> 00:04:22,600 Speaker 1: the high water mark. 95 00:04:22,960 --> 00:04:25,680 Speaker 2: That's true to that point. There was a quote from 96 00:04:25,920 --> 00:04:29,160 Speaker 2: a woman who now is a performance coach. She used 97 00:04:29,160 --> 00:04:31,120 Speaker 2: to be the ex head of a Georgia bank unit 98 00:04:31,120 --> 00:04:33,599 Speaker 2: that linked investors with hedge funds, saying that after a 99 00:04:33,640 --> 00:04:37,520 Speaker 2: bad year, the pitch is simple, check clean, sight, chill 100 00:04:37,800 --> 00:04:40,200 Speaker 2: and let's be honest. Some of these deals are the 101 00:04:40,200 --> 00:04:42,960 Speaker 2: definition of an offer you can't refuse. So it makes 102 00:04:43,000 --> 00:04:44,080 Speaker 2: sense psychologically. 103 00:04:45,240 --> 00:04:48,080 Speaker 1: Yeah, I wonder about chill, right, Like what are your 104 00:04:48,080 --> 00:04:51,359 Speaker 1: incentives at your new firm? On the one hand, you 105 00:04:51,400 --> 00:04:54,080 Speaker 1: want to prove that you still got. 106 00:04:53,920 --> 00:04:54,920 Speaker 3: It, you're still lying. 107 00:04:55,279 --> 00:04:58,359 Speaker 1: On the other hand, one thing the article points out is, 108 00:04:58,360 --> 00:05:01,320 Speaker 1: like you get one of these, you can't continually lose 109 00:05:01,360 --> 00:05:04,760 Speaker 1: a billion dollars. So if you lose a billion dollars, 110 00:05:04,760 --> 00:05:06,920 Speaker 1: it's like you did great. You like took a lot 111 00:05:06,920 --> 00:05:09,000 Speaker 1: of risk, You've learned from your mistakes, You move on, 112 00:05:09,400 --> 00:05:11,960 Speaker 1: You got a new firm, it's great, but you lose 113 00:05:12,000 --> 00:05:14,560 Speaker 1: it again that you're done, so like you haven't sentives 114 00:05:14,560 --> 00:05:16,200 Speaker 1: to be more conservative at your new firm. 115 00:05:16,320 --> 00:05:18,480 Speaker 2: Well to that point, we already have an example. There 116 00:05:18,560 --> 00:05:21,000 Speaker 2: is this man, his name is Rob Banham. He was 117 00:05:21,040 --> 00:05:24,760 Speaker 2: at point seventy two, then he moved to Citadel. He's 118 00:05:24,800 --> 00:05:27,719 Speaker 2: already been let go after making tens of millions of 119 00:05:27,720 --> 00:05:31,400 Speaker 2: dollars of more losses. So I guess he found his 120 00:05:31,440 --> 00:05:34,120 Speaker 2: second strike right. 121 00:05:33,960 --> 00:05:39,800 Speaker 1: Again, this is not would be classy, but it is 122 00:05:39,880 --> 00:05:42,600 Speaker 1: possible that you lost a lot of money because you're 123 00:05:42,640 --> 00:05:45,599 Speaker 1: really talented at losing money. Yeah, but no, I love 124 00:05:45,760 --> 00:05:49,800 Speaker 1: I love the like edgehun compensation structure of like like, 125 00:05:49,839 --> 00:05:52,000 Speaker 1: I think a lot of people would like to be 126 00:05:52,040 --> 00:05:55,120 Speaker 1: able to find a system where if you lose money, 127 00:05:55,640 --> 00:05:58,640 Speaker 1: that's your problem, right, Not so much in multi strategy funds, 128 00:05:58,680 --> 00:06:01,360 Speaker 1: but I've said about this before with single manager hedge funds, 129 00:06:01,400 --> 00:06:03,400 Speaker 1: where if they lose a lot of money for their 130 00:06:03,400 --> 00:06:05,280 Speaker 1: investors and they're below their high water mark, they will 131 00:06:05,279 --> 00:06:08,599 Speaker 1: shut down the fund and spend like six months doing 132 00:06:08,600 --> 00:06:11,520 Speaker 1: penance on a beach, and then they'll like start a 133 00:06:11,520 --> 00:06:13,760 Speaker 1: new fund with a new name, and the investors would 134 00:06:13,760 --> 00:06:15,840 Speaker 1: be like, what the hell, Yeah, you got to earn 135 00:06:15,839 --> 00:06:18,119 Speaker 1: back your high water work. And every so often people 136 00:06:18,120 --> 00:06:21,000 Speaker 1: will be like, I'm going to indenture myself for years 137 00:06:21,240 --> 00:06:24,279 Speaker 1: to my old investors and just earn back every penny 138 00:06:24,279 --> 00:06:28,200 Speaker 1: of my how outter remark and not take and right 139 00:06:28,320 --> 00:06:30,560 Speaker 1: like people do that, but not everyone does that. I 140 00:06:30,560 --> 00:06:33,240 Speaker 1: think limited partners would love to have some incentive structure, 141 00:06:33,320 --> 00:06:38,160 Speaker 1: some compstructure, some contract where they could make the losses 142 00:06:38,440 --> 00:06:41,400 Speaker 1: fully the hedgemand manager's problem. But it's hard to do. 143 00:06:41,520 --> 00:06:43,640 Speaker 1: It's hard to do. No one's quite cracked the good. 144 00:06:44,279 --> 00:06:45,680 Speaker 1: The only thing I stud point out is after I 145 00:06:45,720 --> 00:06:49,200 Speaker 1: wrote about this, I learned of a paper by Maury L. 146 00:06:49,279 --> 00:06:52,400 Speaker 1: Say If a Duke called hedge fund Incentives, risk taking 147 00:06:52,400 --> 00:06:54,719 Speaker 1: and asset prices. What I wrote about is like the 148 00:06:54,720 --> 00:06:57,520 Speaker 1: hedgehend managers like including a multi shred firms have like 149 00:06:58,000 --> 00:07:01,320 Speaker 1: incentives to optimize their b and their high water mark. 150 00:07:01,760 --> 00:07:04,359 Speaker 1: So what that means is like, if it's getting to 151 00:07:04,360 --> 00:07:06,239 Speaker 1: be the end of the year and you're up a lot, 152 00:07:06,800 --> 00:07:10,800 Speaker 1: you like chill because you don't want to lose all 153 00:07:10,800 --> 00:07:13,240 Speaker 1: the games you've made because those games provide your bonus. Right, 154 00:07:13,720 --> 00:07:15,640 Speaker 1: if you're down a little bit, you have a lot 155 00:07:15,640 --> 00:07:18,720 Speaker 1: of incentive to take big risks because if you're down 156 00:07:18,760 --> 00:07:20,520 Speaker 1: a little bit or flat, you don't get a big bonus. 157 00:07:20,520 --> 00:07:22,200 Speaker 1: But if you're up a lot, you got a big bonus. 158 00:07:22,440 --> 00:07:24,000 Speaker 1: And if you're down a lot, you don't do any 159 00:07:24,000 --> 00:07:25,320 Speaker 1: worse than if you're down a little bit, So you 160 00:07:25,360 --> 00:07:28,280 Speaker 1: might as well take big risks. And what else say 161 00:07:28,280 --> 00:07:31,640 Speaker 1: if he finds is that one that's true? And two 162 00:07:31,720 --> 00:07:34,800 Speaker 1: you can see it in asset prices where like basically 163 00:07:35,120 --> 00:07:38,120 Speaker 1: more hi beta, more volatile stocks go up when a 164 00:07:38,120 --> 00:07:40,600 Speaker 1: lot of hedgehunes are below their high water mark because 165 00:07:40,840 --> 00:07:43,000 Speaker 1: they're gambling on redemption. And so like you actually see 166 00:07:43,400 --> 00:07:47,240 Speaker 1: stock prices react to the year end of bonus structures 167 00:07:47,240 --> 00:07:48,200 Speaker 1: of hedgelong managers. 168 00:07:48,720 --> 00:07:52,440 Speaker 2: Man, so I'm gonna I'm going to borrow this paper 169 00:07:52,480 --> 00:07:54,920 Speaker 2: for when I'm on television at the end of the 170 00:07:55,000 --> 00:07:57,880 Speaker 2: year and things are going bananas. I'm just going to say, well, 171 00:07:58,040 --> 00:07:58,840 Speaker 2: I guess a lot of heat. 172 00:07:59,800 --> 00:08:02,760 Speaker 1: Yeah, anything that happens in the year, it's like probably 173 00:08:02,920 --> 00:08:06,720 Speaker 1: someone like optimizing their bonus. 174 00:08:06,760 --> 00:08:09,680 Speaker 2: I use it all the time, month end, quarter ends. Well, 175 00:08:09,720 --> 00:08:11,640 Speaker 2: it looks like things are just weird today. I can't 176 00:08:11,640 --> 00:08:13,560 Speaker 2: explain this tick in this stock. 177 00:08:13,680 --> 00:08:17,320 Speaker 1: But right, I think that, as we've said on this podcast, 178 00:08:17,400 --> 00:08:19,960 Speaker 1: the market is a conversation among four hedge funds. I'm like, 179 00:08:20,040 --> 00:08:20,920 Speaker 1: you know, if they need their. 180 00:08:20,800 --> 00:08:37,160 Speaker 3: Bonus's, it is time to talk about Elon Musk. 181 00:08:37,320 --> 00:08:40,199 Speaker 1: It's been what at least at. 182 00:08:39,880 --> 00:08:42,000 Speaker 3: Least a week, at least a single. 183 00:08:41,640 --> 00:08:44,240 Speaker 1: Week, has it only been want to make anyway? Yeah, 184 00:08:44,240 --> 00:08:46,079 Speaker 1: Elon Musk is back in the news this week. 185 00:08:46,320 --> 00:08:51,800 Speaker 2: Yeah, well actually last Friday Friday. Yeah, you famously don't 186 00:08:51,800 --> 00:08:53,040 Speaker 2: publish on Fridays. 187 00:08:53,720 --> 00:08:56,480 Speaker 1: It's does the crafting email for this? 188 00:08:57,640 --> 00:09:01,600 Speaker 3: Yeah, it takes hours. So Elon Moss one trillion dollars. 189 00:09:01,840 --> 00:09:03,240 Speaker 1: I really don't like this framing. 190 00:09:03,280 --> 00:09:05,080 Speaker 3: Everyone says this, everyone does. 191 00:09:05,440 --> 00:09:09,920 Speaker 1: Elon Musk is the CEO of Tesla and the techno 192 00:09:10,040 --> 00:09:13,600 Speaker 1: king of Tesla. There's also, controversially, let's say he's the 193 00:09:13,600 --> 00:09:14,480 Speaker 1: founder of Tesla. 194 00:09:14,559 --> 00:09:16,120 Speaker 3: That is a controversial statement. 195 00:09:16,320 --> 00:09:18,880 Speaker 1: He didn't found Tesla, but he's the founder of Tesla, 196 00:09:19,080 --> 00:09:22,760 Speaker 1: right for sure. For theoretical purposes, he's the founder of Tesla, 197 00:09:22,840 --> 00:09:25,600 Speaker 1: and so like many founder CEOs, he's a big shareholder 198 00:09:25,640 --> 00:09:28,280 Speaker 1: in Tesla and depends how you can because of like 199 00:09:28,320 --> 00:09:31,360 Speaker 1: the weird option stuff, but he owns like twelve to 200 00:09:31,360 --> 00:09:32,600 Speaker 1: twenty percent of Tesla. 201 00:09:33,080 --> 00:09:33,880 Speaker 3: It's not enough. 202 00:09:33,960 --> 00:09:36,520 Speaker 1: It's not enough, but it's a lot, right, And you 203 00:09:36,559 --> 00:09:39,920 Speaker 1: look at a lot of like these big tech companies 204 00:09:39,960 --> 00:09:42,640 Speaker 1: that are run by their more or less founders. They 205 00:09:42,640 --> 00:09:45,719 Speaker 1: don't get huge compensation packages, and they don't get huge 206 00:09:45,760 --> 00:09:49,120 Speaker 1: compensation packages because like it's just assumed that, like they 207 00:09:49,559 --> 00:09:52,280 Speaker 1: profit from the upside in the company by owning a 208 00:09:52,280 --> 00:09:54,960 Speaker 1: lot of the company. So like Jeff Bezos rand Amazon, 209 00:09:54,960 --> 00:09:57,080 Speaker 1: and you know, Mark Zuckerberg runs Meta, Like these people 210 00:09:57,360 --> 00:10:00,800 Speaker 1: don't get paid hundreds of billions of dollars. They just 211 00:10:00,840 --> 00:10:02,920 Speaker 1: own hundreds of billions of dollars of stock, and like 212 00:10:03,160 --> 00:10:05,280 Speaker 1: when they do good stuff, the stock goes up. And 213 00:10:05,360 --> 00:10:08,920 Speaker 1: so anyway, Elon Musk is not like that for reasons, 214 00:10:09,320 --> 00:10:12,560 Speaker 1: and he instead gets huge compensation packages. And the board 215 00:10:12,960 --> 00:10:16,080 Speaker 1: or Tessa's ass shareholders to vote on a new package 216 00:10:17,080 --> 00:10:20,840 Speaker 1: that targets growing Tesla from the day about a trillion 217 00:10:20,840 --> 00:10:23,560 Speaker 1: dollar company into a eight point five trillion dollar. 218 00:10:23,360 --> 00:10:26,040 Speaker 3: Company, which is two in videos, two. 219 00:10:25,920 --> 00:10:29,199 Speaker 1: In videos, yeah, right, more two in videos now, yeah, 220 00:10:29,240 --> 00:10:32,959 Speaker 1: who knows what year, But if he succeeds in growing 221 00:10:32,960 --> 00:10:36,200 Speaker 1: Tesla to an eight point five trillion dollar company, they 222 00:10:36,240 --> 00:10:38,520 Speaker 1: will give him a trillion dollars worth of stock, which 223 00:10:38,559 --> 00:10:41,280 Speaker 1: is great, but like, also he will have a trillion 224 00:10:41,280 --> 00:10:44,200 Speaker 1: dollars worth of stock anyway, Like, he already owns a 225 00:10:44,240 --> 00:10:46,559 Speaker 1: lot of stock, and if he eight point five times 226 00:10:46,600 --> 00:10:48,960 Speaker 1: the company, then the stock will be worth a trillion dollars. 227 00:10:50,080 --> 00:10:52,440 Speaker 1: So like, it's not like they sat down and thought, 228 00:10:53,080 --> 00:10:55,120 Speaker 1: if we give elan musk at trillion dollars, he will 229 00:10:55,120 --> 00:10:56,880 Speaker 1: turn this into an eight point five trillion dollar company. 230 00:10:56,920 --> 00:10:59,160 Speaker 1: It's like, if we give another trillion dollars on top 231 00:10:59,200 --> 00:11:01,120 Speaker 1: of the trillion dollars he already get for that, then 232 00:11:01,160 --> 00:11:04,880 Speaker 1: I'll turn it into an eight point five trillion dollar company. 233 00:11:04,960 --> 00:11:07,360 Speaker 1: It's not a trillion dollar it's like whatever, it's if 234 00:11:07,360 --> 00:11:09,200 Speaker 1: he does this, he would have a trillion dollars anyway, 235 00:11:09,200 --> 00:11:11,560 Speaker 1: because he's a big shelter. This is all in the 236 00:11:11,600 --> 00:11:14,200 Speaker 1: shadow of like he had this comp package that Adella 237 00:11:14,280 --> 00:11:16,720 Speaker 1: reports strike down, and like the judge at the time wrote, 238 00:11:16,760 --> 00:11:25,040 Speaker 1: like the board did not analyze whether it was necessary 239 00:11:25,080 --> 00:11:26,880 Speaker 1: to give him all of this given that he's a 240 00:11:26,920 --> 00:11:30,120 Speaker 1: huge shareholder anyway, and like the comp set, the Zuckerbergs 241 00:11:30,120 --> 00:11:32,440 Speaker 1: of the world don't get, you know, trillion dollar Paybay 242 00:11:32,480 --> 00:11:35,880 Speaker 1: just they benefit from their share ownership. Once again, the 243 00:11:35,920 --> 00:11:38,120 Speaker 1: board does not think that Elon Musk gets much incentive 244 00:11:38,120 --> 00:11:40,720 Speaker 1: effect from the shares he already owns. Yeah, they're just 245 00:11:40,760 --> 00:11:43,120 Speaker 1: like he needs more shares, and it's like clearly not 246 00:11:43,280 --> 00:11:46,800 Speaker 1: true that he is being incentivized by a trillion dollars. 247 00:11:46,800 --> 00:11:49,160 Speaker 1: What's happening here is that Elon Musk wants to own 248 00:11:49,200 --> 00:11:52,360 Speaker 1: twenty five percent of the company, and so the board 249 00:11:52,400 --> 00:11:53,800 Speaker 1: is like, how do we get him twenty five percent 250 00:11:53,840 --> 00:11:55,800 Speaker 1: of the company, And they just give him twenty five 251 00:11:55,800 --> 00:11:57,319 Speaker 1: percent of the company. They'd be like, well, if we 252 00:11:57,320 --> 00:11:59,120 Speaker 1: don't give him twenty five percent of the company, you'd quit. 253 00:11:59,200 --> 00:12:01,959 Speaker 1: So here it is right, but that like looks really bad. 254 00:12:02,840 --> 00:12:05,000 Speaker 1: Even to a Texas court, that would look bad. So 255 00:12:05,040 --> 00:12:06,320 Speaker 1: what they're doing is they're saying, oh, we have like 256 00:12:06,360 --> 00:12:09,440 Speaker 1: these super ambitious performance calls, and if he meets these goals, 257 00:12:09,480 --> 00:12:11,840 Speaker 1: then we'll give them a trillion dollars. It's probably a 258 00:12:12,040 --> 00:12:16,199 Speaker 1: reasonable solution. But it's so like he's owned like twenty 259 00:12:16,200 --> 00:12:18,760 Speaker 1: five percent of Tesla, then he sold down like by 260 00:12:18,800 --> 00:12:21,640 Speaker 1: Twitter and stuff. It's very strange that he just he 261 00:12:21,679 --> 00:12:24,240 Speaker 1: thinks he deserves to perpetually own twenty five percent of 262 00:12:24,240 --> 00:12:25,680 Speaker 1: Tesla and the board is like, well you have to 263 00:12:25,679 --> 00:12:26,160 Speaker 1: give it to m. 264 00:12:26,360 --> 00:12:30,480 Speaker 2: Well, people have tried to stop him from what from 265 00:12:30,520 --> 00:12:32,320 Speaker 2: owning that much or I don't know, you think about 266 00:12:32,360 --> 00:12:34,640 Speaker 2: the twenty eighteen experience, Yeah. 267 00:12:34,440 --> 00:12:36,959 Speaker 1: Right, I think that. You know. Elan mess says, the 268 00:12:37,000 --> 00:12:40,160 Speaker 1: funniest thought comes the most likely, Like you could sue. 269 00:12:40,559 --> 00:12:44,839 Speaker 1: You could takes us to stop this. Everyone assumes you 270 00:12:44,880 --> 00:12:48,480 Speaker 1: would lose, but anyone really knows that's true. I am 271 00:12:48,559 --> 00:12:50,920 Speaker 1: really what if someone sued in one? Wouldn't that be funny? 272 00:12:51,000 --> 00:12:54,520 Speaker 2: That wouldn't be funny. Maybe not the funniest thing though, 273 00:12:54,559 --> 00:12:55,559 Speaker 2: so it probably won't happen. 274 00:12:55,679 --> 00:12:57,440 Speaker 1: He'd be so mad that I think it'd be pretty. 275 00:12:57,200 --> 00:12:59,880 Speaker 2: Funny, but whatever, Okay, I am curious to see what 276 00:13:00,040 --> 00:13:03,680 Speaker 2: happens over the next decade. Obviously, because eight point five 277 00:13:03,720 --> 00:13:06,400 Speaker 2: trillion dollars, I mean, the first you think about the 278 00:13:06,679 --> 00:13:10,440 Speaker 2: incentive structure that was put in place the first time around. 279 00:13:11,040 --> 00:13:13,480 Speaker 2: That was very ambitious as well. 280 00:13:13,320 --> 00:13:15,520 Speaker 1: And he did it when he got his twenty eighteen package, 281 00:13:15,559 --> 00:13:17,840 Speaker 1: Like the idea of making Tesla a trillion dollar company, 282 00:13:18,160 --> 00:13:20,120 Speaker 1: which is not exactly the target, but like yeah, which 283 00:13:20,120 --> 00:13:22,240 Speaker 1: he did would have seemed kind of absurd, and then 284 00:13:22,240 --> 00:13:24,959 Speaker 1: he did it in fairly short order. Yeah, I don't know, 285 00:13:25,080 --> 00:13:26,040 Speaker 1: a decade, a long time. 286 00:13:26,240 --> 00:13:27,839 Speaker 2: One of the things that you mentioned in your column 287 00:13:27,920 --> 00:13:32,600 Speaker 2: is that Elon Musk the world's richest man that briefly 288 00:13:32,640 --> 00:13:36,760 Speaker 2: became not true this that's right, Larry Elson briefly became. 289 00:13:36,480 --> 00:13:37,480 Speaker 3: The world's richest man. 290 00:13:37,520 --> 00:13:39,760 Speaker 2: Now they're I don't know, I think like a billion 291 00:13:39,800 --> 00:13:42,520 Speaker 2: dollars separates them at this exact moment. But you think 292 00:13:42,520 --> 00:13:45,520 Speaker 2: about the future, I think the exact think one. 293 00:13:45,400 --> 00:13:46,960 Speaker 1: Or both of them is like watching the chart as 294 00:13:47,000 --> 00:13:47,720 Speaker 1: the lens crossed. 295 00:13:47,720 --> 00:13:49,840 Speaker 2: I would like to think that both of them are. 296 00:13:49,960 --> 00:13:54,440 Speaker 2: But in any case, obviously Oracle had insane earnings and 297 00:13:54,559 --> 00:13:56,200 Speaker 2: had an insane outlook. 298 00:13:55,800 --> 00:13:58,400 Speaker 1: And uh like flatish earnings on insane look. 299 00:13:58,440 --> 00:14:00,319 Speaker 3: But yeah, well that's it's mostly out. 300 00:14:00,840 --> 00:14:03,520 Speaker 2: Yeah, and you think about the billings growth and whatever 301 00:14:03,920 --> 00:14:05,880 Speaker 2: and where the future is going to go. It really 302 00:14:06,000 --> 00:14:09,720 Speaker 2: just underscored why Elon wants to turn Tesla into an 303 00:14:09,760 --> 00:14:14,360 Speaker 2: AI company, because, Okay, maybe evs still are the future. 304 00:14:14,400 --> 00:14:17,720 Speaker 2: They don't feel as immediately the future as AI is 305 00:14:17,960 --> 00:14:18,400 Speaker 2: right now. 306 00:14:18,600 --> 00:14:22,280 Speaker 1: Oh yeah, right, I mean you can point to your billings, 307 00:14:22,680 --> 00:14:25,800 Speaker 1: your like potential future sales as a DA company to your. 308 00:14:25,760 --> 00:14:28,640 Speaker 2: Three hundred billion dollars worth of contracts that you signed 309 00:14:28,640 --> 00:14:29,240 Speaker 2: with open Ai. 310 00:14:29,680 --> 00:14:31,560 Speaker 1: It's you know, it's sort of worth that much in 311 00:14:31,680 --> 00:14:34,760 Speaker 1: market cup, right. That's why Elon Musk is turning his 312 00:14:34,840 --> 00:14:40,160 Speaker 1: focus to AI, and it's also why Tesla needs to 313 00:14:40,280 --> 00:14:41,920 Speaker 1: pay up to keep him, right, because there are more 314 00:14:41,920 --> 00:14:45,440 Speaker 1: obvious AI players like his AI company. Also in the 315 00:14:45,480 --> 00:14:49,840 Speaker 1: Tesla proxy, yeah, there's a shareholder proposal to invest in Xai. 316 00:14:50,440 --> 00:14:54,440 Speaker 1: And it's funny because like there's some business rationale for 317 00:14:54,480 --> 00:14:59,360 Speaker 1: Tesla to invest in XI companies put the chat out 318 00:14:59,360 --> 00:15:00,440 Speaker 1: on the dashboard. 319 00:15:00,040 --> 00:15:02,440 Speaker 3: Which they've done I think talk to your car. 320 00:15:02,640 --> 00:15:05,120 Speaker 1: Yeah, But so like there's some business case. There's a 321 00:15:05,200 --> 00:15:08,080 Speaker 1: there's a very big, like Elon Musk personal business case, 322 00:15:08,080 --> 00:15:13,000 Speaker 1: which is that Tesla is not the most obvious AI company, right, 323 00:15:13,000 --> 00:15:15,280 Speaker 1: it's not going to capture the public imagination the way 324 00:15:15,400 --> 00:15:18,760 Speaker 1: like Oracle is. But then like Xai, which is a 325 00:15:18,800 --> 00:15:22,000 Speaker 1: more obvious AI play, plays are very expensive and it 326 00:15:22,040 --> 00:15:24,320 Speaker 1: needs money, and Tesla has money, so like it does 327 00:15:24,400 --> 00:15:27,680 Speaker 1: make sense for Elon Musk to like merge them or 328 00:15:27,720 --> 00:15:29,960 Speaker 1: like take some Tesla money and give a TEXTI or whatever. 329 00:15:30,720 --> 00:15:34,160 Speaker 1: But even in the current situation. Even in Texas, it 330 00:15:34,200 --> 00:15:38,240 Speaker 1: doesn't seem a little hard for Tesla to just decide 331 00:15:38,280 --> 00:15:40,840 Speaker 1: on the CEO's whim to invest billions or dollars in 332 00:15:40,880 --> 00:15:44,400 Speaker 1: the CEO's other company. But if the cherlders. 333 00:15:44,040 --> 00:15:46,240 Speaker 3: Asked for it, yeah, that's true. 334 00:15:47,280 --> 00:15:49,520 Speaker 1: And then it's funny because like someone tweeted about it 335 00:15:49,560 --> 00:15:52,120 Speaker 1: and Elon Musk was like, it's not up to me. 336 00:15:52,200 --> 00:15:53,800 Speaker 1: The shareolders have to ask far and so like some 337 00:15:53,920 --> 00:15:58,800 Speaker 1: chrelder duly like went and proposed exactly and then like 338 00:15:58,880 --> 00:16:02,000 Speaker 1: you know, the shareholders overwhelming the button favor and then 339 00:16:02,040 --> 00:16:03,760 Speaker 1: the word are like that did they give surely what 340 00:16:03,760 --> 00:16:05,720 Speaker 1: they want? Well, we're going to give Elan his money, 341 00:16:05,720 --> 00:16:08,600 Speaker 1: and then someone will negotiate it. It's not how one 342 00:16:08,600 --> 00:16:11,760 Speaker 1: normally runs a company, but it's like it's happening. 343 00:16:11,840 --> 00:16:30,360 Speaker 4: It's runs a company, all right, Eric Adams, thank you 344 00:16:30,640 --> 00:16:34,400 Speaker 4: to Front of the Show Bill Ackman, the actual Bill Ackman, 345 00:16:34,480 --> 00:16:37,640 Speaker 4: for teeing us up for this too delating conversation. 346 00:16:38,160 --> 00:16:41,240 Speaker 1: Friend of the Show by Lackman went on Twitter to 347 00:16:41,280 --> 00:16:43,800 Speaker 1: try to persuade Eric Adams to drop out of the 348 00:16:43,840 --> 00:16:47,680 Speaker 1: New York City mayoral race, which is a for our purposes. 349 00:16:47,720 --> 00:16:50,600 Speaker 1: Let's say three way race between Zori Mundanni. 350 00:16:50,200 --> 00:16:53,240 Speaker 3: Who's you know, fan favorite. 351 00:16:54,280 --> 00:16:58,640 Speaker 1: Odd lots cast, betting market favorite, polling favorite, Zora Mundannie, 352 00:16:58,920 --> 00:17:02,120 Speaker 1: and then there's Andrew who's heard of him Bill Ackman 353 00:17:02,240 --> 00:17:07,920 Speaker 1: favorite yep. And then there's Area Adams is the current 354 00:17:07,960 --> 00:17:10,159 Speaker 1: mayor and seems to have no shot. But so like 355 00:17:10,160 --> 00:17:13,800 Speaker 1: a prediction market, the polymarket has zorround at like eighty percent, 356 00:17:13,800 --> 00:17:17,280 Speaker 1: odds Cuomo like eighteen percent, and then like you know, 357 00:17:17,320 --> 00:17:19,240 Speaker 1: Adams like one or two percent or something like that. 358 00:17:19,720 --> 00:17:22,199 Speaker 1: And so Bill Ackman went on Twitter to be like, 359 00:17:22,960 --> 00:17:25,760 Speaker 1: Arian Adams drop out, because I'm Donnie, seems to have 360 00:17:25,840 --> 00:17:28,880 Speaker 1: a plurality, and so like if everyone else drops out, 361 00:17:28,880 --> 00:17:31,240 Speaker 1: then like maybe a Cuomo consolidate's enough support to win. 362 00:17:31,640 --> 00:17:33,720 Speaker 1: So if Aria Adams drops out, that like really materially 363 00:17:33,760 --> 00:17:38,760 Speaker 1: improves Cuomo's chances. And so Acman went on Twitter to 364 00:17:38,760 --> 00:17:42,199 Speaker 1: be like, er Adams drop out. But he also said, 365 00:17:42,960 --> 00:17:45,280 Speaker 1: and to fund your future, you could place a large 366 00:17:45,320 --> 00:17:48,360 Speaker 1: bet on Andrew Cuomo and then announce your withdrawal from 367 00:17:48,359 --> 00:17:51,080 Speaker 1: the race. There is no insider trading on polymarket. 368 00:17:51,400 --> 00:17:54,280 Speaker 3: What a crazy thing to say. I mean, God, plus, 369 00:17:54,480 --> 00:17:55,320 Speaker 3: he's not even wrong. 370 00:17:55,840 --> 00:17:59,240 Speaker 1: He's wrong in the sense that he says you could 371 00:17:59,280 --> 00:18:01,399 Speaker 1: place a large bet on uncoma. I don't think that's true. Like, 372 00:18:01,400 --> 00:18:03,200 Speaker 1: I don't think the liquidity in these markets is enough 373 00:18:03,240 --> 00:18:07,320 Speaker 1: for like, Like one thing we know about Eric Adams 374 00:18:07,359 --> 00:18:12,000 Speaker 1: is that he enjoys like playing trips. Yes, I don't 375 00:18:12,040 --> 00:18:14,720 Speaker 1: think you could make a ton of money betting on 376 00:18:14,760 --> 00:18:19,720 Speaker 1: anentercroma some liquidity. But like, as a general proposition, is 377 00:18:19,760 --> 00:18:25,320 Speaker 1: this a thing that will become popular in politics, which 378 00:18:25,359 --> 00:18:28,280 Speaker 1: is betting against yourself and then dropping out of the race. 379 00:18:28,560 --> 00:18:33,440 Speaker 2: Yeah, I would like to see that world that future actualized. 380 00:18:33,440 --> 00:18:35,000 Speaker 2: I think it would be funny and it would provide 381 00:18:35,040 --> 00:18:37,040 Speaker 2: a lot of fodder for this podcast. 382 00:18:37,119 --> 00:18:39,800 Speaker 1: Oh yeah, oh yeah, right, I mean, because like traditionally 383 00:18:39,840 --> 00:18:42,360 Speaker 1: you're not you're not supposed to pay people to drop 384 00:18:42,400 --> 00:18:45,520 Speaker 1: out of political races. Seems a little it seems a 385 00:18:45,520 --> 00:18:48,520 Speaker 1: little bribby. But then like the prediction markets are sort 386 00:18:48,520 --> 00:18:52,000 Speaker 1: of like a distributed way for dropping out of your race. 387 00:18:52,080 --> 00:18:55,159 Speaker 2: And I mean trading, and Bi Lackman didn't say I 388 00:18:55,200 --> 00:18:57,000 Speaker 2: will be on the other side of this trade, so 389 00:18:57,400 --> 00:18:58,240 Speaker 2: that was good, right. 390 00:18:58,280 --> 00:19:00,080 Speaker 1: I Mean, one thing I wrote about this is that 391 00:19:00,200 --> 00:19:02,600 Speaker 1: there's not a ton of liquidity. Eric Adams couldn't make 392 00:19:02,640 --> 00:19:06,840 Speaker 1: a ton of money by doing this unless someone where 393 00:19:06,880 --> 00:19:08,359 Speaker 1: to step in and be on the other side of 394 00:19:08,400 --> 00:19:10,880 Speaker 1: the trade, which again he didn't offer, but like would 395 00:19:10,880 --> 00:19:13,080 Speaker 1: have been you know, it would be the logical next step. 396 00:19:13,600 --> 00:19:15,800 Speaker 1: But then the other question is is he right about 397 00:19:15,960 --> 00:19:18,760 Speaker 1: there being no insider trading and nobody really knows. 398 00:19:18,920 --> 00:19:21,960 Speaker 3: Yeah, it's like don't know until you try. 399 00:19:21,840 --> 00:19:25,960 Speaker 1: Or for years afterwards. So, by the way, another independent 400 00:19:26,000 --> 00:19:28,720 Speaker 1: reason that Eric Adams couldn't do that is because no 401 00:19:28,760 --> 00:19:32,119 Speaker 1: one believes it's still illegal to trade on Pollymarket if 402 00:19:32,119 --> 00:19:34,680 Speaker 1: you're a US person, Like poly Market is not available 403 00:19:34,680 --> 00:19:35,160 Speaker 1: in the US. 404 00:19:35,359 --> 00:19:36,960 Speaker 3: No one ever talks about that ever. 405 00:19:36,840 --> 00:19:38,840 Speaker 1: Talks about like they used to chuckle about it, like 406 00:19:39,320 --> 00:19:41,320 Speaker 1: you can't you know, like Probly marks like advertising all 407 00:19:41,320 --> 00:19:43,840 Speaker 1: over New York and everyone's like, oh, you can't trade 408 00:19:43,880 --> 00:19:46,400 Speaker 1: on Pollymarket in the US. But like everyone did. If 409 00:19:46,400 --> 00:19:49,040 Speaker 1: you go to their website now they're like, Polymarket is 410 00:19:49,040 --> 00:19:55,720 Speaker 1: coming home. The website actually has a little eagle, so good. No, 411 00:19:55,840 --> 00:19:57,720 Speaker 1: it's like it's just like, you know, it looks like 412 00:19:59,400 --> 00:20:01,520 Speaker 1: it looks like a Trump Sun designed it. But anyway, 413 00:20:01,560 --> 00:20:03,960 Speaker 1: Polymarket is coming home. Polymarket will soon be available for 414 00:20:04,040 --> 00:20:07,359 Speaker 1: US traders the website right, but it's not now right, 415 00:20:07,440 --> 00:20:09,879 Speaker 1: so you can't do it, but so right now, Like 416 00:20:10,040 --> 00:20:11,920 Speaker 1: if you want to trade prediction markets in the US, 417 00:20:11,960 --> 00:20:14,280 Speaker 1: you can trade on CALCI. What should talk about all 418 00:20:14,320 --> 00:20:16,679 Speaker 1: the time because you can predict sporting events on calshy, 419 00:20:17,200 --> 00:20:20,720 Speaker 1: and CALSHI has insider trading rules, quite strict insider trading rules, 420 00:20:20,760 --> 00:20:23,280 Speaker 1: so you can't trade if you have material on public 421 00:20:23,359 --> 00:20:25,560 Speaker 1: information or if you can influence the outcome of the event. 422 00:20:26,160 --> 00:20:30,840 Speaker 1: Polymarkets rules are less clear, and I imagine that when 423 00:20:30,880 --> 00:20:35,960 Speaker 1: polymarket is available in the US, it will look more 424 00:20:36,080 --> 00:20:41,480 Speaker 1: like real commodities exchanges, which don't say you can't trade 425 00:20:41,520 --> 00:20:46,160 Speaker 1: on material on public information, because that's not how commodities 426 00:20:46,200 --> 00:20:49,840 Speaker 1: markets work. I quoted Carolyn fam who's the acting Commissioner 427 00:20:49,840 --> 00:20:53,040 Speaker 1: at the CFTC. You talked about the special characteristics of 428 00:20:53,040 --> 00:20:56,199 Speaker 1: the derivative markets, where end users necessarily trade on the 429 00:20:56,200 --> 00:20:59,000 Speaker 1: basis of their own proprietary information in order to hedge 430 00:20:59,040 --> 00:21:01,919 Speaker 1: their risks. You're an oil company trading oil futures. You 431 00:21:02,000 --> 00:21:05,639 Speaker 1: know something about oil production that other people don't know, 432 00:21:05,520 --> 00:21:08,879 Speaker 1: and you're totally allowed to trade it. So in US 433 00:21:08,920 --> 00:21:13,560 Speaker 1: regulated commodities markets, you're not allowed to trade with misappropriated information. 434 00:21:13,680 --> 00:21:16,439 Speaker 1: So if you work at an oil company and you 435 00:21:16,480 --> 00:21:19,000 Speaker 1: trade for your personal account based on the oil companies 436 00:21:19,080 --> 00:21:23,120 Speaker 1: production plans, that's probably insider trading. That's probably not allowed 437 00:21:23,119 --> 00:21:25,520 Speaker 1: because you're misappropriating that information. You have some duty to 438 00:21:25,600 --> 00:21:28,679 Speaker 1: keep that confidential, right, But like the oil company itself 439 00:21:28,680 --> 00:21:31,240 Speaker 1: can trade commodities, And if you like, read that through 440 00:21:31,320 --> 00:21:33,960 Speaker 1: to election markets, which are not commodities, none of this 441 00:21:34,000 --> 00:21:37,280 Speaker 1: makes any sense in election markets, but you know they 442 00:21:37,320 --> 00:21:39,199 Speaker 1: are treated as commodities. If you read it through to 443 00:21:39,320 --> 00:21:42,240 Speaker 1: election markets, then it's like, well, if Eric Adams is 444 00:21:42,480 --> 00:21:46,240 Speaker 1: campaign manager place an insider bet, that would be bad 445 00:21:46,280 --> 00:21:49,040 Speaker 1: to be misappropriation for sure, eric Adoms does it himself. 446 00:21:49,800 --> 00:21:52,160 Speaker 1: Maybe it's fun. So I really don't know. I really 447 00:21:52,160 --> 00:21:54,400 Speaker 1: don't know what the sort of like future rules around 448 00:21:54,440 --> 00:21:59,199 Speaker 1: insider trading prediction markets will be, because like there are 449 00:21:59,200 --> 00:22:02,720 Speaker 1: a lot of people, include like Calshi and the people 450 00:22:02,720 --> 00:22:05,920 Speaker 1: who got Calshi to be a regulated US Torovators exchange, 451 00:22:06,000 --> 00:22:07,640 Speaker 1: there are a lot of people who are like, that's 452 00:22:07,680 --> 00:22:09,920 Speaker 1: icky and unfair, and we do not want to have 453 00:22:10,600 --> 00:22:13,280 Speaker 1: the trouble that would come with allowing insider trading, right, 454 00:22:13,760 --> 00:22:14,840 Speaker 1: but there are a lot of people who are, like, 455 00:22:14,880 --> 00:22:17,119 Speaker 1: the whole point of prediction markets is insider trading. The 456 00:22:17,119 --> 00:22:19,680 Speaker 1: whole point of prediction markets is to get accurate predictions 457 00:22:19,680 --> 00:22:22,520 Speaker 1: by like incentivizing insiders to bet on stuff they know. 458 00:22:23,680 --> 00:22:26,159 Speaker 1: Like that's like when economists set up prediction markets, right, 459 00:22:26,200 --> 00:22:29,000 Speaker 1: that's the whole point. Yeah, And so Kelshi has spent 460 00:22:29,080 --> 00:22:32,520 Speaker 1: years trying to become a regulated exchange, and like wanted 461 00:22:32,560 --> 00:22:36,560 Speaker 1: to appeal to conservative regulators. We don't live at a 462 00:22:36,560 --> 00:22:39,480 Speaker 1: time where people are that conservative insider trading anymore. So 463 00:22:39,600 --> 00:22:41,399 Speaker 1: I think I don't really know what's gonna happen. 464 00:22:41,880 --> 00:22:46,040 Speaker 2: You could build a case that Eric Adams did listen 465 00:22:46,480 --> 00:22:49,879 Speaker 2: to Bill Ackman, which I find tickling about this story. 466 00:22:49,920 --> 00:22:51,199 Speaker 1: He hasn't dropped out yet, right, he. 467 00:22:51,200 --> 00:22:52,160 Speaker 3: Hasn't dropped out yet. 468 00:22:52,160 --> 00:22:57,200 Speaker 2: But this is Thursday, und Yes, on September fifth, Eric 469 00:22:57,240 --> 00:23:01,240 Speaker 2: Adams had a press conference I believe that was Friday. 470 00:23:01,720 --> 00:23:04,960 Speaker 2: He said that he's staying in New York City's mayoral race. 471 00:23:05,400 --> 00:23:07,280 Speaker 2: He also said that Andrew Cuomo is a snake and 472 00:23:07,320 --> 00:23:09,919 Speaker 2: a liar. That's a direct quote. So on Friday of 473 00:23:10,000 --> 00:23:13,040 Speaker 2: last week, he was very committed to staying In September 474 00:23:13,080 --> 00:23:15,480 Speaker 2: six is when we got the Bill Lackman tweet, which 475 00:23:15,560 --> 00:23:20,680 Speaker 2: was awesome. And then today, on Thursday, the eleventh of September, 476 00:23:20,880 --> 00:23:25,040 Speaker 2: Bloomberg News reported that New York City Mayor Eric Adams 477 00:23:25,080 --> 00:23:27,040 Speaker 2: did tell a group of civic and business leaders that 478 00:23:27,080 --> 00:23:29,679 Speaker 2: he's conducting his own polling to decide the future of 479 00:23:29,720 --> 00:23:32,919 Speaker 2: his re election campaign. This is according to people who 480 00:23:32,960 --> 00:23:36,199 Speaker 2: attended the meeting. So he's at least thinking about it. 481 00:23:36,240 --> 00:23:40,760 Speaker 1: He's still making money. Like that's like, I just love 482 00:23:40,800 --> 00:23:43,040 Speaker 1: the tell the political matter. Billman would like him drop 483 00:23:43,080 --> 00:23:45,119 Speaker 1: out the financial matter, believans like you can make a 484 00:23:45,160 --> 00:23:46,880 Speaker 1: lot of money by dropping in. I don't think it's true, 485 00:23:46,880 --> 00:23:48,480 Speaker 1: but it would be funny if it was true. 486 00:23:48,840 --> 00:23:51,040 Speaker 3: Maybe he's thinking about it. Who knows, I'm not. 487 00:23:51,280 --> 00:23:54,240 Speaker 1: You know you're buying enter Cromo contracts. 488 00:23:54,720 --> 00:23:58,480 Speaker 3: I'm certainly not. I don't know if we can man 489 00:24:00,359 --> 00:24:01,879 Speaker 3: step away from the mic first. 490 00:24:02,000 --> 00:24:03,760 Speaker 1: No, as I said, I don't think there's a lot 491 00:24:03,760 --> 00:24:05,119 Speaker 1: of money to be made at it, and there's a 492 00:24:05,160 --> 00:24:07,720 Speaker 1: lot of unpleasantness, right, But maybe it's like the market 493 00:24:07,760 --> 00:24:10,480 Speaker 1: is discounting this right, Like, yeah, the market is aware 494 00:24:10,520 --> 00:24:10,960 Speaker 1: of Bill. 495 00:24:10,840 --> 00:24:12,640 Speaker 3: Ackrans streets like that's true. 496 00:24:13,119 --> 00:24:14,040 Speaker 1: Is like three percent? 497 00:24:14,119 --> 00:24:14,199 Speaker 3: Right? 498 00:24:14,440 --> 00:24:16,520 Speaker 1: I wonder if Coma's chances would go have that much 499 00:24:16,560 --> 00:24:18,080 Speaker 1: if Adams chopped out, But I don't know. 500 00:24:18,280 --> 00:24:20,760 Speaker 2: We'll say I was going to say, we've still got 501 00:24:20,800 --> 00:24:23,000 Speaker 2: a long way to go, but there's not that much 502 00:24:23,240 --> 00:24:26,359 Speaker 2: longer time marchers still on. 503 00:24:28,960 --> 00:24:31,639 Speaker 3: All right, Well we've collectively sighed, So I think I 504 00:24:31,640 --> 00:24:32,400 Speaker 3: think that's the end. 505 00:24:32,800 --> 00:24:37,920 Speaker 1: That's the final side. Yeah, And that was the Money 506 00:24:37,920 --> 00:24:38,760 Speaker 1: Stuff Podcast. 507 00:24:39,080 --> 00:24:41,120 Speaker 3: I'm Matt Levine and I'm Katie Greifeld. 508 00:24:41,400 --> 00:24:43,520 Speaker 1: You can find my work by subscribing to the Money 509 00:24:43,560 --> 00:24:46,200 Speaker 1: Stuff newsletter on Bloomberg dot com. 510 00:24:45,920 --> 00:24:48,400 Speaker 2: And you can find me on Bloomberg TV every day 511 00:24:48,440 --> 00:24:51,320 Speaker 2: on the Clothes between three and five pm Eastern. 512 00:24:52,080 --> 00:24:54,080 Speaker 1: We'd love to hear from you. You can send an 513 00:24:54,080 --> 00:24:57,120 Speaker 1: email to your money Pop at Bloomberg dot net, ask 514 00:24:57,200 --> 00:24:59,320 Speaker 1: us a question and we might answer it on the air. 515 00:24:59,640 --> 00:25:02,280 Speaker 2: You can also subscribe to our show wherever you're listening 516 00:25:02,359 --> 00:25:04,199 Speaker 2: right now and leave us a review. 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