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Speaker 1: This is the Bloomberg Surveillance Podcast.

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Speaker 2: I'm Tom Keane, along with Jonathan Ferroll and Lisa Abramowitz.

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Speaker 2: Join us each day for insight from the best an economics, geopolitics,

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Speaker 2: finance and investment. Subscribe to Bloomberg Surveillance on demand on Apple,

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Speaker 2: Spotify and anywhere you get your podcasts, and always on

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Speaker 2: Bloomberg dot Com, the Bloomberg Terminal, and the Bloomberg Business App.

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Speaker 3: Live from the city of London, hometol for me, no secret,

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Speaker 3: my favorite city on the planet. And I could say

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Speaker 3: that because we've got a hime audience. Good afternoon, Good

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Speaker 3: afternoon to you all. A special edition of Bloomberg Surveillance

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Speaker 3: from our Bloomberg Global Credit Forum alongside Tom Kean and

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Speaker 3: Lisa Brownitz. I'm Jonathan Ferrow TK. We couldn't aplan to anybody,

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Speaker 3: could we.

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Speaker 1: Yeah. They came to me like six months ago.

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Speaker 2: Julie had her people calling me up, and Julie so

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Speaker 2: we got to do this Pale I said I don't

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Speaker 2: want to do it, and I said, you know, okay,

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Speaker 2: we're gonna do this panel, but we need some theatrics.

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Speaker 1: So she said, look, if.

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Speaker 2: We can range of fed and the BOE, particularly the

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Speaker 2: BOE five four decision to blow up the bond market.

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Speaker 2: Over forty eight hours, we could probably get Zeldner and

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Speaker 2: that's how this start.

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Speaker 3: Let's get the two year something close to five, twenty

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Speaker 3: ten year up to maybe four fifty.

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Speaker 4: Yeah.

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Speaker 5: But the problem is is that the volatility, as Jim

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Speaker 5: was saying, is all in the two year, the ten year,

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Speaker 5: the thirty year. It isn't in the credit market, which

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Speaker 5: is what you would expect. And people have been wondering, well,

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Speaker 5: will actually matter for the fact that it's getting more expensive.

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Speaker 2: Yeah, it's real sophisticated yield up, price down, price down

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Speaker 2: means assets are challenged. I don't care what flavor you

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Speaker 2: have here of the ice cream of the fixed income market.

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Speaker 2: The answer is coming out of this. Dare I say

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Speaker 2: what Bojada is tomorrow? We've got moonshots in certain series

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Speaker 2: and what I'm focused on more and this is my

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Speaker 2: first question to Jim, is going to be the ten

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Speaker 2: year real yield.

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Speaker 3: We're all living this right now, and I think slowly

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Speaker 3: over the last couple of months and then quickly internalizing

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Speaker 3: that high for longer message across various central banks, but

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Speaker 3: particularly the federal reserve. We're internalizing that increasingly, we're seeing

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Speaker 3: it in the treasury market. Risk assets really resilient in

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Speaker 3: the face of all of this. She's talking about it

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Speaker 3: to real anominal ness, psycle highs and risk assets just

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Speaker 3: pretty steady.

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Speaker 2: Still, there's no question about that in the last eighteen months.

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Speaker 2: But I'm going to go to the memory of Jim

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Speaker 2: Curry out the door at Golden Sachs and Jim Curry

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Speaker 2: and hydrocarbons.

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Speaker 1: There he said, look, the real yield changes.

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Speaker 2: It affects everything in the real economy, including all the

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Speaker 2: investments of apollow really everything out There's no question.

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Speaker 3: Jeff Curry is not in the audience, Jeff, he is

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Speaker 3: this afternoon, Jeff, excuse Jeff Curry.

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Speaker 1: It's late to day. I did last night.

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Speaker 6: Three minutes into this. It's funny time from Mark. I'm

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Speaker 6: going to bring in the guest.

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Speaker 1: I'll bring in the guest right now.

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Speaker 2: This is fun and it's really fun given where the

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Speaker 2: markets are. He played lacrosse at Duke University, and I

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Speaker 2: went back and I looked at the first day that

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Speaker 2: Jim walked into Apollo, and the real yields about back

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Speaker 2: to where we were in two thousand and six, we've

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Speaker 2: come full circle. First of all, what was the first

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Speaker 2: day like at Apollo, And what does it mean that

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Speaker 2: the real yield, the ten year real yield is now

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Speaker 2: back to where.

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Speaker 1: It was in six seven.

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Speaker 7: Well, first of all, thanks for inviting me today. I'm

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Speaker 7: excited to be part of this great road trip, you know,

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Speaker 7: taking back down memory lane. Apollo was a much smaller

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Speaker 7: business back then. We were probably twenty billion in assets.

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Speaker 7: We're six hundred and fifty today. The role of banks

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Speaker 7: was much much different. There was a massive risk appetite

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Speaker 7: that time in the world. But certainly if you go back,

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Speaker 7: I think the world was very different, and I guess

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Speaker 7: I would start out today saying, as you guys talk about,

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Speaker 7: you know where real rates are. Basically what you're really

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Speaker 7: saying is the cost of capital has gone through a

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Speaker 7: massive reversal. And so all the activity going on in

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Speaker 7: the last eighteen months between all the central banks of

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Speaker 7: the globe, that was the mechanics of getting to this destination.

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Speaker 4: But now we have the rebounds.

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Speaker 7: We got out of Bounce for ten years that was

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Speaker 7: priced way too cheap, and you were forced to go

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Speaker 7: into equities and basically debt subsidize massive amount of equity returns.

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Speaker 4: And so the last eighteen.

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Speaker 7: Months, you know, the world now has about three hundred

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Speaker 7: trillion in debt on one hundred trillion in global economy.

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Speaker 7: Those numbers are up basically doubled in the last ten years.

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Speaker 7: And when you go from zero to basically four or

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Speaker 7: five percent, that's ten trillion of borrowing costs that have

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Speaker 7: to be absorbed. And so there's a massive balance going

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Speaker 7: on between debt versus equity and versus balance sheets.

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Speaker 2: So yeah, I get folks, we're gonna turn this into

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Speaker 2: a two hour seminar. Given where the markets are. We're

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Speaker 2: arguing about this, I'm.

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Speaker 6: Not sure they want this to become a two right now.

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Speaker 2: Well, the answer is, I'm gonna let least in John

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Speaker 2: do the heavy lifting here. I got one more question,

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Speaker 2: which is the memory of nineteen ninety eight, which was

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Speaker 2: about leveraging the system. It was about shadows in the system.

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Speaker 2: Now that we're back here, and with the first and

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Speaker 2: second derivdives of how we got back here, where are

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Speaker 2: the shadows now?

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Speaker 7: Well, certainly the wherever there's an asset liability mismatch. SVB

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Speaker 7: was a perfect example. At people talk about regulation. It

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Speaker 7: was just a simple not how you operate a financial

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Speaker 7: services business.

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Speaker 4: Where are there.

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Speaker 7: Al mismatches you certainly, I don't think it's in the

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Speaker 7: world of private credit. I think is probably a lot

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Speaker 7: of consumer finance challenges around the globe right now. You've

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Speaker 7: got way too much public debt right now.

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Speaker 4: There's challenges.

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Speaker 7: So there will no doubt be challenges for the next

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Speaker 7: twenty four to forty eight months as you've got fund

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Speaker 7: companies that have funded debt, laiden balance sheets of companies

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Speaker 7: that have funded growth cap x and they cannot pay

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Speaker 7: the piper right now.

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Speaker 3: Everything you said in your opening remarks is what Lisa

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Speaker 3: wrote about for the best part of a decade, right

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Speaker 3: complaining about the previous regime. We're all trying to figure

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Speaker 3: out if this is truly a new regime or just

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Speaker 3: the moment in time that we move away from pretty quickly.

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Speaker 3: Can we live with where real rights are right now?

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Speaker 6: Can we live with that?

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Speaker 1: Well?

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Speaker 7: I think that it's sort of we're getting back we talked.

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Speaker 7: You say real rates, I say cost of capital. It's

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Speaker 7: cost of capital for everything we do. If you think

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Speaker 7: at the last ten or fifteen years, the growth of

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Speaker 7: technology companies, the growth of biotech. There's some great companies

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Speaker 7: out there, but they were funded with the equity, had

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Speaker 7: all the benefit, and the zero cost of debt is

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Speaker 7: not really sustainable.

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Speaker 4: So this is the real world right now.

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Speaker 7: Real rates are going to be higher the cost of

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Speaker 7: capital as we go back to this balance, and I

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Speaker 7: don't think it's a surprise this week as we were

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Speaker 7: talking about earlier the ft ed by the two finance

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Speaker 7: ministers of France and Germany talking about the European financial

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Speaker 7: services sector and the role of banks.

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Speaker 4: So there's a parallel path here.

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Speaker 7: Conversation about how companies finance, how they get access to capital,

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Speaker 7: the role of savings and securitizations.

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Speaker 4: So it really is all tied together.

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Speaker 5: Although are we really living with rates where they are?

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Speaker 5: I mean, we take a look at these average rates,

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Speaker 5: we see them in the numbers, but that's not what

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Speaker 5: anyone's actually paying. Companies have already turned out their debt.

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Speaker 6: So are we living with it?

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Speaker 5: Are we going to see what it looks like to

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Speaker 5: live with it in a year?

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Speaker 4: I think we're not seeing it.

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Speaker 7: So to highlight that comment, the mechanism, the transition mechanism

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Speaker 7: which the feather would like to see in slowing down

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Speaker 7: the economy, which we all expected, it's taken a lot longer.

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Speaker 7: In the US, you have a mortgage market with thirty

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Speaker 7: year mortgages at a three percent interest rate. You have

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Speaker 7: the high yual market with a six percent coupon and

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Speaker 7: an eight year duration. So the real impact of higher

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Speaker 7: costs around the globe, in the US and Western Europe,

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Speaker 7: it's not been felt yet. And so when people say, well,

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Speaker 7: we're going to have a soft landing, I'm skeptical. I

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Speaker 7: see a world where financial conditions have gotten tighter, and

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Speaker 7: it's just a question of how long that transition mechanism,

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Speaker 7: which will probably be longer than it's taken in the past.

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Speaker 5: There are a couple different ways for us to get

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Speaker 5: to something other than a soft landing. There's the crash

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Speaker 5: and then rates going back down, and then there's something

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Speaker 5: where it's just sort of a stagflation light or a

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Speaker 5: stagflation proper, where rates remain high for a very long

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Speaker 5: time and growth just slows substantially. It seems like the

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Speaker 5: market is leaning into the ladder. How much does that

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Speaker 5: change your perception of what's going to happen in.

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Speaker 4: The credit space.

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Speaker 7: Well, this conversation is going into one where we need

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Speaker 7: to get torched in here because he's the economists of POWO,

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Speaker 7: not me. But certainly what you're talking about is an

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Speaker 7: environment where growth is more challenged and with how to

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Speaker 7: companies access capital with a new price of marketplace. Certainly

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Speaker 7: you have challenge whether it's in Germany or in the

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Speaker 7: UK with a slowing economic growth. But there's a variety

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Speaker 7: of aspects that we would see. Unemployment, while still very low,

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Speaker 7: it's going in probably a more challenging direction. Delinquency needs

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Speaker 7: are going up, the faults are going up a little bit,

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Speaker 7: in the leverage loan market, in the high oal market,

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Speaker 7: recoveries are lower. So there's a lot of points would

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Speaker 7: say to you that there's going to be a more

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Speaker 7: challenging tightening financial conditions. But certainly for us, the US

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Speaker 7: has been quite strong, the UK, there's still a lot

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Speaker 7: of areas to lend. There is on Western Europe as well,

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Speaker 7: so I do I guess the theme that I would

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Speaker 7: take away from this is that we're going from a

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Speaker 7: decade of a real imbalance where the equity was the

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Speaker 7: big beneficiary, debt paid a crazy price. That balance has

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Speaker 7: been completely changed to one hundred eighty degrees, And now

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Speaker 7: how do companies navigate, how does the financial services, how

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Speaker 7: to banks, how to alternative asset managers? How do we

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Speaker 7: all balance and navigate this marketplace ahead of us?

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Speaker 6: Is this the return of the bond vigilantes?

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Speaker 4: Then, well, I.

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Speaker 7: Do think when people talk about when the central banks

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Speaker 7: are going to actually lower rates, I think it will

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Speaker 7: happen well before they actually get around to it, just

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Speaker 7: like it happened on the upside in terms of rates.

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Speaker 7: There's no doubt that one of the challenges of the

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Speaker 7: last fifteen years of the regularory environment is you've had

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Speaker 7: so much capital withdrawn from these marketplaces in terms of

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Speaker 7: trading desk capital, So the amount of capital to trade

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Speaker 7: one hundred or a billion dollars of ten year treasuries

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Speaker 7: right now, that has a greater impact. So there's no

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Speaker 7: doubt that any kind of activity in the secondary markets

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Speaker 7: will have a pronounced impact. And that's that's just that's

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Speaker 7: just the way of the regulatory impact post GFC. But

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Speaker 7: for us, I mean, if you're in my seat at Apollo,

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Speaker 7: there's been four trends since I got in the business.

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Speaker 7: There's been massive technology improvement, there's been massive globalization, there's

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Speaker 7: been massive deregulation, and the fourth there's been a decline

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Speaker 7: of interest rates. Other than technology, you're probably having those

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Speaker 7: tailwinds be massive headwinds as an investor now, so.

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Speaker 4: How do you navigate that? How do you organize yourself?

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Speaker 7: But I do think in terms of investors, it's a

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Speaker 7: time to be a.

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Speaker 2: Big technology change is the Bloomberg terminal.

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Speaker 3: Everyone needs a blomback time and everybody is out the pitch.

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Speaker 3: We done this, Okay, We're done. Earlier in the conversation,

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Speaker 3: Jim mentioned that joint op ed that was in the

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Speaker 3: Financial Times. The headline, for those of you didn't read it,

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Speaker 3: we must close the EU Capital markets gap. Can you

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Speaker 3: talk to me about how Europe goes about doing that?

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Speaker 3: Because me, Tom, Lisa, this whole audience has heard that

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Speaker 3: a million times in the last ten years.

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Speaker 6: How do we close that gap?

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Speaker 7: Well, I think let's talk about how we got here.

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Speaker 7: We got here a POSTGFC where a lot of tools

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Speaker 7: that have been used to push risk out of the

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Speaker 7: banking system that I think have been successful in some

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Speaker 7: regions of the globe. The European regulators took a different view.

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Speaker 7: They took a dim view of securitizations. I would argue

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Speaker 7: that if you look at securitized product that's actually been

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Speaker 7: very good for the banking system and aggregate, it's push

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Speaker 7: risk out to the real owners of risk. If you

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Speaker 7: look at other things that they talk about about shareholder activism.

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Speaker 4: But I do think.

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Speaker 7: There's got to be an embracing of these types of

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Speaker 7: tools to allow greater activity, because I think it's creating

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Speaker 7: a bit of financial services stagnation.

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Speaker 2: Tursan Slot called me up one day and he said,

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Speaker 2: you know, you really ought to look at the Austrian piece.

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Speaker 2: So I loaded the boat in the ninety seven year

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Speaker 2: Austrian bond that really has worked out well. I'm don

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Speaker 2: like seventy percent or whatever. Tell me about what duration

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Speaker 2: is going to do and choice of duration is going

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Speaker 2: to do given this new environment back to six seven

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Speaker 2: o eight.

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Speaker 7: You know, again, when I think about the world, I

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Speaker 7: think about long duration.

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Speaker 4: But we what we do, we do what Apollo is, We're.

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Speaker 7: Really trying to figure out places where we're not taking

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Speaker 7: credit risk or duration risk. I'm just creating great spread.

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Speaker 7: So whether it's fixed income replacement, I certainly believe that

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Speaker 7: the world has been on that textbook of if you

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Speaker 7: want to make money in fixed income, you got a duration.

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Speaker 4: I think that's it's an interesting way to look at

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Speaker 4: the world.

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Speaker 7: I think you're getting paid right now and risk free

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Speaker 7: rates to some degree.

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Speaker 4: Whether they go a little bit higher or wider.

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Speaker 7: I certainly know for us at apollow for us, whether

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Speaker 7: it's in the investment grade world, public and private, whether

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Speaker 7: it's in private capital. When we can make high single

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Speaker 7: digits ten percent being a lender, that's a great business.

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Speaker 1: Do you headge into that? I mean we do.

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Speaker 7: We are our business. If we are most of our

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Speaker 7: business is unlevered. But if we do have any kind

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Speaker 7: of leverage in our business, we match alm complete asset

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Speaker 7: liability matching all the way through.

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Speaker 5: So it's better for you now, right private or public.

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Speaker 5: You said that private is sort of immune, and yet

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Speaker 5: a lot of people think it's just not traded. So

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Speaker 5: you can't see some of the carnage that you see

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Speaker 5: in some of the IPOs of arm sure and instacart.

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Speaker 7: So what's your view there, Well, I think certainly if

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Speaker 7: you look at an aggregate, it's hard to make money

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Speaker 7: in the public markets. Is an aggregate statement equity and debt,

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Speaker 7: certainly with the valuations where they've backed out in terms

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Speaker 7: of where rates are right now or risk free rate. Yes,

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Speaker 7: there's some opportunities in the investment grade world, but if

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Speaker 7: you look at high yield indexes and leverage loan indexes,

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Speaker 7: they're arguably rich. They're rich for a lot of technical

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Speaker 7: reasons and so our ability. Again, when we talk about

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Speaker 7: private credit, most people you talked about earlier, they talk

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Speaker 7: about really the sponsor finance market. The reality is, whether

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Speaker 7: it's inventory finance, trade finance, solar finance, there's a massive

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Speaker 7: thirty to forty trillion dollar opportunity in terms of the TAM.

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Speaker 7: So that's where we're spending most of our time creating

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Speaker 7: great safe spread yield really on investment grade companies.

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Speaker 4: This sounds like a bank, Well, I would say is

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Speaker 4: we are a credit lender.

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Speaker 7: We provide credit, and we do it in a manner

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Speaker 7: where we're not using a balance sheet that we can

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Speaker 7: lose deposits tomorrow. We have long tail liabilities and we

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Speaker 7: match those.

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Speaker 5: A lot of people have said, particularly in the banking sector,

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Speaker 5: they're going after their lunch and that they have to

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Speaker 5: follow pretty significant regulations and you don't have to, and

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Speaker 5: you have fixed capital and it's kind of what it

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Speaker 5: sounds like in terms of the size and the scope

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Speaker 5: that you need to achieve. It's kind of taking on

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Speaker 5: a lot of the functions that banks used to fulfill.

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Speaker 5: Is that the business model right now?

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Speaker 7: Well, I think our business model so if you look

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Speaker 7: at our six hundred and fifty billion today, three hundred

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Speaker 7: and fifty billion comes from retirement services, balance sheets, fixed annuities.

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Speaker 4: The other half is the GP model.

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Speaker 7: We're able to lend money to air France, to Venovia,

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Speaker 7: the big German real estate companies. We can do that

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Speaker 7: in a manner where we are solving the company's problems,

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Speaker 7: and many times we're doing it in conjunction with a

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Speaker 7: advisor or a bank. There's a narrative out there that

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Speaker 7: we win, the banks lose, or vice versa. The reality

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Speaker 7: is we are doing more in collaboration than we've ever

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Speaker 7: done before. We have a big venture with BNP and

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Speaker 7: Inventory Finance. They've got an amazing franchise. We partner with

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Speaker 7: them so they can manage their capital in a more

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Speaker 7: efficient way. But the reality is there's more collaboration. And

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Speaker 7: people say, are you frenemies, are you opponents? Are your

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Speaker 7: competitors it's all the above. We work very closely with

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Speaker 7: them and they work closely with us.

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Speaker 6: To make some news.

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Speaker 3: There was a headline yesterday Apollo looking to raise about

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Speaker 3: two point five billion to len in private markets, according

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Speaker 3: to people with knowledge of the matter. We're talking to

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Speaker 3: someone with knowledge of the matter.

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Speaker 6: Maybe, are you.

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Speaker 3: Looking to raise about two point five billion dollars to

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Speaker 3: lend a private markets?

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Speaker 7: You know, we're an active player in the extension of

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Speaker 7: senior loans to sponsors. We're active in many of these businesses.

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Speaker 7: We've got a four hundred and twenty five billion dollar

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Speaker 7: credit business. The fact is we built this business not

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Speaker 7: expecting real yields and absolute yields to beat these levels.

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Speaker 7: We thought it was going to be lower for longer.

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Speaker 7: We created all these origination platforms. So the reality is

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Speaker 7: today investors around the globe are clamoring and they're saying, way,

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Speaker 7: on a risk adjusted basis, we can do this in

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Speaker 7: the credit markets or in the debt markets.

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Speaker 4: Why do we need to take that equity risk?

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Speaker 7: And I think that's why you're seeing a preponderance of

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Speaker 7: conversations about from sovereign funds to foundations to pensions around

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Speaker 7: the globe. Saying we can make what we had to

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Speaker 7: take equity risk in the past. We can do it

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Speaker 7: on the death side of the balance sheet.

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Speaker 3: I think, yes, yes, you are looking to raise two

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Speaker 3: point five Well, we're recently, we.

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Speaker 7: Have a we have a large platform, we're one of

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Speaker 7: the we're one of the handful of great players in

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Speaker 7: the world.

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Speaker 4: We're raising How.

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Speaker 1: Does that work? Do you make like six phone calls?

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Speaker 1: I mean, you know, I travel quite a bit.

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Speaker 7: If you ask my family, I travel a little bit

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Speaker 7: more than those six phone calls. But you know, we

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Speaker 7: we have several thousand LPs around the globe, and my

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Speaker 7: schedule could be packed up going to visit.

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Speaker 6: I can see a policy.

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Speaker 3: Are right now, Jim, you were not meant to say yes.

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Speaker 6: Just keep talking and answer the question. Jim.

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Speaker 3: Let's go back to spring. Spring was really messy. Banks

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Speaker 3: failed in America, and I remember sitting down and we

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Speaker 3: had guests come on the program with a some Bloomberg surveillance,

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Speaker 3: and lots of guests said, we started a process here,

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Speaker 3: it's the end of the cycle. There's going to be

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Speaker 3: a hard landing. It's only several months ago.

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Speaker 6: What was that.

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Speaker 7: I think it was a expectation of what was happening

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Speaker 7: at that moment was going to happen uh completely. And

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Speaker 7: the reality is this is a big, broad global The

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Speaker 7: consumer plays a massive role in it. Back to my

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Speaker 7: common earlier about three percent mortgages on thirty years, The

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Speaker 7: US consumer really has not. We may have taken rates up,

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Speaker 7: but the real impact of this higher cost, the second,

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Speaker 7: the third derivative, it's early still, it's really early, and

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Speaker 7: I think that's the difference between you know, there is

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Speaker 7: no doubt the health of the US consumer has what

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Speaker 7: allowed us to extend the economic cycle. But I don't

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Speaker 7: think I think they're eating through some of their savings.

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Speaker 7: And there's no doubt that there's a more that the

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Speaker 7: tightening of financial conditions is going to be out there,

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Speaker 7: and you know, we're finding more companies coming to us

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Speaker 7: trying to solve their financing needs going forward.

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Speaker 2: There are other firms challenged because they decided they were

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Speaker 2: going to go off and do something different, new, original,

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Speaker 2: and they're selling things for a haircut. You're probably involved

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Speaker 2: in those transactions. How do you avoid worse practices? You

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Speaker 2: guys have grown this thing from next to nothing. The

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Speaker 2: private world is in right now.

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Speaker 1: You're doing brain drain.

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Speaker 2: You're taking all the smart guys from Wall Street over opile.

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Speaker 1: Everybody knows the ballet.

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Speaker 2: How do you avoid the worst practices we observe every

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Speaker 2: day on the show where things blow up through the street.

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Speaker 7: Well, the biggest accident you can do as you grow

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Speaker 7: is to offer people liquidity on ill liquid assets. And

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Speaker 7: so I don't think it's a surprise. We don't. We're

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Speaker 7: not in the business of offering daily liquidity in any.

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Speaker 4: Of our products.

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Speaker 7: We run our products, we really match the assets to

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Speaker 7: the liabilities, and again I think that's really a core

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Speaker 7: to how we.

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Speaker 4: Run our business.

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Speaker 7: The second is we've for the last six seven years,

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Speaker 7: we've continued to go senior senior senior in the capital structure.

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Speaker 7: We're doing more investment grade companies. We're doing larger companies.

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Speaker 7: Witness what we've done with as I mentioned earlier, Air France,

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Speaker 7: or At and T or Venovia, big quality companies. So

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Speaker 7: also when we underwrite something, for the most part, we

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Speaker 7: bring in partners. We want others to take a look

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Speaker 7: at what we've done. We're really good at underwriting credit

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Speaker 7: at risk. We brought a lot of that credit oversight

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Speaker 7: that is so valuable at many of the financial institutions.

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Speaker 7: But we have to make sure we're really measured and

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Speaker 7: we focus on the three businesses that we're in right now.

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Speaker 5: Jim, what are you doing with the books they already

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Speaker 5: hold of debt and equity that is valued much lower.

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Speaker 5: I mean, it's one thing to talk about future lending opportunities, Sure,

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Speaker 5: what about the ones he already did?

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Speaker 4: Well, let's talk about our business.

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Speaker 7: So today I have the six hundred billion equity is

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Speaker 7: around the sixth of our business about one hundred billion.

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Speaker 7: We've been very very clear in our private equity business

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Speaker 7: in our flagship vehicles to fund more so with fixed

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Speaker 7: rate debt and really extend those maturities. For the most part,

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Speaker 7: we have been really not levering to the max. If

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Speaker 7: you could lever companies five six times, we typically borrow lent,

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Speaker 7: borrowed about three to four times, so we were we

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Speaker 7: didn't we didn't borrow as much, and we did it

442
00:20:51,720 --> 00:20:55,159
Speaker 7: for term at fixed rates. That's really important that what

443
00:20:55,240 --> 00:20:57,160
Speaker 7: we learned in eight oh nine it wasn't we were

444
00:20:57,160 --> 00:20:59,240
Speaker 7: the smartest guys in room, is that we had the

445
00:20:59,280 --> 00:21:01,399
Speaker 7: best capital. And if you had the best capital and

446
00:21:01,440 --> 00:21:04,119
Speaker 7: didn't get pulled away from the table. That's usually a

447
00:21:04,160 --> 00:21:05,520
Speaker 7: critical aspect of success.

448
00:21:05,920 --> 00:21:08,120
Speaker 3: That takes us to our final question to wrap things

449
00:21:08,200 --> 00:21:11,119
Speaker 3: up with the Jim, in a world of high uncertainty

450
00:21:11,160 --> 00:21:13,880
Speaker 3: and low confidence, do you have a high conviction call

451
00:21:14,320 --> 00:21:15,840
Speaker 3: looking at in this market right now?

452
00:21:15,960 --> 00:21:17,679
Speaker 4: Well, I think that you have to assume.

453
00:21:17,880 --> 00:21:19,600
Speaker 7: I think there's going to be what we call some

454
00:21:20,160 --> 00:21:25,240
Speaker 7: big fat pitches out there, the reorganizing and the restructuring

455
00:21:25,359 --> 00:21:29,119
Speaker 7: and the refinancing of the entire CIRA universe. You have

456
00:21:29,200 --> 00:21:32,720
Speaker 7: to be marshaling resources around that. You have to make

457
00:21:32,760 --> 00:21:35,639
Speaker 7: sure that if you are lending capital today, you're doing

458
00:21:35,680 --> 00:21:39,240
Speaker 7: so on senior basis with a tremendous amount of equity

459
00:21:39,280 --> 00:21:42,719
Speaker 7: underneath you. So for us, I mean certainly, we're in

460
00:21:42,760 --> 00:21:45,600
Speaker 7: three businesses. We've been very, very disciplined about what we've done.

461
00:21:45,880 --> 00:21:47,760
Speaker 7: We have had a lot of human capital. It's been

462
00:21:47,840 --> 00:21:51,200
Speaker 7: amazing for our company to pivot and grow. But really

463
00:21:51,240 --> 00:21:54,320
Speaker 7: to make sure that we stay true to our alignment,

464
00:21:54,800 --> 00:21:59,159
Speaker 7: our risk adjusted returns and making sure that purchase price

465
00:21:59,200 --> 00:22:02,639
Speaker 7: does matter. Are very focused on the creation value of

466
00:22:02,640 --> 00:22:03,320
Speaker 7: our businesses.

467
00:22:03,520 --> 00:22:04,560
Speaker 1: Man, you lost.

468
00:22:04,359 --> 00:22:07,119
Speaker 3: Last night is that what happened against the opportunity is

469
00:22:07,160 --> 00:22:09,320
Speaker 3: that we go to the Glass.

470
00:22:08,960 --> 00:22:10,560
Speaker 1: And yeah they lost to the Garry Kanes.

471
00:22:10,600 --> 00:22:12,240
Speaker 6: So anybody I was trying to make some news, Yeah,

472
00:22:12,240 --> 00:22:14,119
Speaker 6: I'm trying to make something. You want to buy football clupy.

473
00:22:14,359 --> 00:22:17,560
Speaker 7: You know, we we have an active you know, we

474
00:22:17,640 --> 00:22:19,840
Speaker 7: have an active lending business, and we've done a variety

475
00:22:19,920 --> 00:22:21,960
Speaker 7: of things in the world of sports entertainment.

476
00:22:22,000 --> 00:22:24,920
Speaker 4: But we really are to know this time.

477
00:22:26,440 --> 00:22:30,040
Speaker 3: Can we have a run of applause for Pollows Jim's outside. Jim,

478
00:22:30,160 --> 00:22:33,040
Speaker 3: thank you, Thank you very much, and thank you to

479
00:22:33,080 --> 00:22:35,160
Speaker 3: all of you for joining a special edition of Bloomberg

480
00:22:35,160 --> 00:22:36,879
Speaker 3: Surveillance Life for the City of London.

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00:22:37,760 --> 00:22:41,600
Speaker 2: Subscribe to the Bloomberg Surveillance podcast on Apple, Spotify, and

482
00:22:41,720 --> 00:22:45,920
Speaker 2: anywhere else you get your podcasts. Listen live every weekday

483
00:22:46,200 --> 00:22:49,679
Speaker 2: starting at seven am Eastern on Bloomberg dot Com, the

484
00:22:49,800 --> 00:22:52,159
Speaker 2: iHeartRadio app, tune In.

485
00:22:52,320 --> 00:22:53,800
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486
00:22:54,240 --> 00:22:58,000
Speaker 2: You can watch us live on Bloomberg Television and always

487
00:22:58,280 --> 00:23:02,120
Speaker 2: on the Bloomberg terminal. Thanks for listening. I'm Tom Keen

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00:23:02,359 --> 00:23:04,000
Speaker 2: and this is Blomber