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Speaker 1: Welcome to Turians. I'm Joel Webber and I'm Eric Bell. Students, Eric,

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Speaker 1: do you happen to remember what happened about ten years ago?

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Speaker 1: Right now? Vaguely? Uh? You know, I was thinking, it's

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Speaker 1: the ten year anniversary of two thou great financial Crisis,

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Speaker 1: and when we were preparing for this, I actually didn't

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Speaker 1: have many vivid memories, less than I thought. Neither did I.

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Speaker 1: I actually, for me that it was I can bring

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Speaker 1: this back to a podcast because Planet Money did this

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Speaker 1: amazing episode about the financial crisis, and that I was

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Speaker 1: not in financial journalism yet, and that was the thing

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Speaker 1: that actually helped me understand what what was happening around us.

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Speaker 1: I was in financial journalism at the beginning of my

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Speaker 1: career in the late nineties, so I very much remember

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Speaker 1: the Clinton years. But then I went to data. You know,

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Speaker 1: I was working in funds, but we just had to

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Speaker 1: get the n A V up, the shares out the holdings.

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Speaker 1: Our job was much more mechanical than tied to the markets,

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Speaker 1: whether markets up or down, you still have to get

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Speaker 1: that data in there, and that was my main focus.

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Speaker 1: That's why most of my memories are from my own

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Speaker 1: account and remembering the political aspect to that crisis more

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Speaker 1: than you know the financial aspect. But going back surprised

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Speaker 1: me actually, And there's many different ways you could call

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Speaker 1: call it a tenure anniversary, right, but I think the

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Speaker 1: one that that everyone's gonna hang their hat on is

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Speaker 1: gonna be the Lehman Brothers bankruptcy, which pappens September. And

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Speaker 1: I also think that over time two thous eight becomes

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Speaker 1: this boogeyman that is so big you just assume the

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Speaker 1: whole year was this giant black hole. It cast this

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Speaker 1: long shadow. It still gets brought up, but when you

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Speaker 1: go back, there were definitely some some rough points, but

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Speaker 1: it was much more diverse than just this general general

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Speaker 1: black hole of of market. And then let's bring it

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Speaker 1: back to et S because that's what we're going to

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Speaker 1: spend the episode, talking about both what happened that year

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Speaker 1: and what's happened since. And you found what five or

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Speaker 1: so data points that we're gonna walk through. Yeah, So

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Speaker 1: in preparing for this, I went through I just found

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Speaker 1: I thought five stats that I found interesting, surprising, and

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Speaker 1: pointed to deeper issues within how ETFs handled and behaved

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Speaker 1: in two thousand eight. And because neither of us were

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Speaker 1: really on the front lines. Were joined by a wonderful guest,

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Speaker 1: Christine Harper, who is the editor of Bloomberg Markets magazine,

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Speaker 1: and in two thousand eight she was actually covering banking

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Speaker 1: for Bloomberg News, so she was literally at the front lines.

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Speaker 1: That's basically the world started to crumble. So she'll be

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Speaker 1: joining us and kind of helping us bring a different

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Speaker 1: perspective of what it was actually like to be watching

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Speaker 1: this thing in slow motion this week on Trilliance, Remembering

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Speaker 1: two thousand eight and what it all means. Now, Okay,

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Speaker 1: so Eric, you've got a stat that you want to

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Speaker 1: start with. Christine Harper is joining us. She's the editor

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Speaker 1: of Bloomberg Markets Magazine. She's also the author of a

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Speaker 1: book forthcoming book about Paul Volker, which we're all really

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Speaker 1: excited about. Eric, what's the first step. The first step

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Speaker 1: is e t f s took in a hundred and

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Speaker 1: seventy five billion dollars in flows in two thousand and eight.

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Speaker 1: That is a bit right. So first of all, the

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Speaker 1: context is I find this data shocking because the word

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Speaker 1: on the street, especially from active funds, is hey, all

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Speaker 1: you people going to passive that they're all weekends are

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Speaker 1: going to flip out as soon as the market gets tough,

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Speaker 1: and it's gonna the market will blow up even more

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Speaker 1: because of all these e t f s. But if

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Speaker 1: you look back in two thousand eight, e t F

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Speaker 1: took in a hundred and seventy four billion, index mutual

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Speaker 1: funds took in another looks like ninety billion, and active

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Speaker 1: mutual funds lost two hundred and fifty nine billions. So

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Speaker 1: if anything, it was the active mutual fund investors who

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Speaker 1: got um you know, scared or panicked and left, whereas

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Speaker 1: the e t F investors. Again, this is a net

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Speaker 1: number over the year. Within months, there was definitely some

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Speaker 1: volatility in and out of some products, but that is

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Speaker 1: quite a shocking number in my opinion, given that you

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Speaker 1: would think that e t fs are used more by

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Speaker 1: retail and advisors, less sophisticated investors. They trade intra day

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Speaker 1: and so they would be sold off in mass and

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Speaker 1: people running for the hills. Christine, I want to I

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Speaker 1: want to rewind the clock too. You were on the

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Speaker 1: finance team covering Goldman Morgan Stanley. How familiar were you

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Speaker 1: with ETFs at that point in time? So at that

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Speaker 1: point in time, we I knew they existed, but what

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Speaker 1: I'd like to say is that at that point you

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Speaker 1: can almost think of the run up to the financial

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Speaker 1: crisis as a run up in investment in a liquid products.

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Speaker 1: I mean, Goldman Sachs disclosed in early two thousand seven

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Speaker 1: that they had a hundred and eleven billion dollars of

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Speaker 1: assets that they defined I gotta read this phrase as

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Speaker 1: more difficult to fund on a secure basis during times

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Speaker 1: of market stress that was up, that was more than

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Speaker 1: double two years earlier, everybody was, you know, plunging into

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Speaker 1: mortgage backed securities that were put into c d O

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Speaker 1: s and then into c d O squares, things that

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Speaker 1: were almost inherently illiquid, with the assumption that they would

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Speaker 1: always go up in value or they could always find liquidity.

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Speaker 1: And they always had these you know, great acronyms of

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Speaker 1: nbs and c d O s. But the point was

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Speaker 1: they were all traded through banks that none of them

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Speaker 1: were on exchanges. They were very difficult to get out

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Speaker 1: of when people wanted to get out of. So my

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Speaker 1: theory is that E t F s, almost by dint

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Speaker 1: of the fact that they were exchanged traded funds, became

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Speaker 1: the one of the go to assets just purely for

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Speaker 1: I mean, t bills were trading trading negatively at that period.

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Speaker 1: People just wanted liquidity, no matter what the cost. So

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Speaker 1: it makes a lot of sense to me that all

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Speaker 1: this money that was desperately getting out of a liquid

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Speaker 1: credit was going into exchange traded funds. Because also another

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Speaker 1: thing that was happening at that point for the banks,

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Speaker 1: there became this vogue for reporting what did you ever

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Speaker 1: hear this term level three assets? Probably it rings all

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Speaker 1: that became very, very very important to investors during the

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Speaker 1: financial crisis because what it is is it's the most

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Speaker 1: hard to value assets on banks balance sheets, and those

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Speaker 1: were the ones nobody wanted, right, So exchanged anything exchange

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Speaker 1: traded as a level one asset, that's great. Then level

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Speaker 1: two are things where there's some inputs that are a

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Speaker 1: little bit less clear. Level three are the ones where

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Speaker 1: they're basically it's their own model that tells them how

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Speaker 1: much it's worth. And so literally investors were demanding, we

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Speaker 1: were sending headlines on the amount of level three assets

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Speaker 1: that banks had and that banks were trading on how

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Speaker 1: liquid they were. I'm sure those stories were getting highly

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Speaker 1: highly read, yes, and so any amount of any any

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Speaker 1: It makes sense to me that people are going into

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Speaker 1: exchange traded funds purely for liquidity. And the other thing

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Speaker 1: which we've talked about a lot, the you know c

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Speaker 1: d O s and if he has were part of

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Speaker 1: the problem was that you didn't know what you exact

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Speaker 1: There was no transparency, and so almost the perfect antidote

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Speaker 1: to that was an exchange trade exactly where you could

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Speaker 1: see what you're you were getting. When when Um in

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Speaker 1: the book I wrote nameless plug, one of the advantages

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Speaker 1: that I don't want to hear it again. You don't

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Speaker 1: even know what it is, and that's not the name

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Speaker 1: the institutional e t F two. Okay, all right, we're

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Speaker 1: friends again. Okay, all right. Um. One of the advantages

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Speaker 1: that I will riff off this, which was when I

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Speaker 1: was going through and interviewing people by advantages, is fiduciary vehicle.

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Speaker 1: And I think that speaks to the level one asset,

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Speaker 1: the fact that there's a prospectus tied to it, the

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Speaker 1: fact that it's a forty act fund. I do think

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Speaker 1: that probably give people a lot of comfort in a

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Speaker 1: time of derivatives, and the fact that you know it

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Speaker 1: trades like futures, but it is backed. Those stocks that

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Speaker 1: are in the e t F are with a custodian

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Speaker 1: physically backed probably did help that year in terms of

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Speaker 1: being a contrast to these other products. And there's real

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Speaker 1: time pricing, right, that's very transparent. Okay, Point number two,

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Speaker 1: this one riffs great off of the first conversation, which

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Speaker 1: is that each f S traded just about trillion dollars

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Speaker 1: worth of shares. Now that's significant for a couple of reasons.

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Speaker 1: First of all, it's more than the US GDP. That's

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Speaker 1: a lot of money exchanging hands. Second, that is by

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Speaker 1: and far the most et f s ever traded in

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Speaker 1: a year ever to this day, and they only had

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Speaker 1: a sixth of the assets back then. Why. Here's why,

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Speaker 1: and it just speaks what when the going gets tough,

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Speaker 1: E t f s tend to be traded more and more.

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Speaker 1: They sort of thrive in volatility. They are trading vehicles,

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Speaker 1: so when people are uncertain, that's when they tend to

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Speaker 1: go up. And they tend to be about of the

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Speaker 1: equity trading every day, but in highly volatile times they

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Speaker 1: can be and this has been indicated since then. Um.

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Speaker 1: In fact, I've frequently charted sp wise dollar volume with

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Speaker 1: the VIX. I mean it perfectly overlays. In other words,

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Speaker 1: it's almost like E t F volume is a fear gauge.

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Speaker 1: And part of the reason is people can use et

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Speaker 1: F to short there's options on them. There's all kinds

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Speaker 1: of ways you can use them to protect yourself, go along, speculate,

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Speaker 1: and ultimately their liquids so on the portfolio. If you

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Speaker 1: don't want to disturb your individual holdings, the E t

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Speaker 1: F might be the first thing you move around to

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Speaker 1: deal with what's happening out there. I like the idea

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Speaker 1: of E t F s a the fear gauge, right,

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Speaker 1: And we talked about that actually a little earlier in

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Speaker 1: the year with what happened back in February when we

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Speaker 1: also saw some volatility. When you look back and can

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Speaker 1: kind of compare the volatility at those two moments and

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Speaker 1: the volumes that were happening, what do you what do

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Speaker 1: you notice between what we saw earlier this year? How

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Speaker 1: do they compare? Just size? Uh, you know, early February

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Speaker 1: was pretty intense. Uh. The spy traded about ninety billion

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Speaker 1: on a couple of days. That's almost its record was

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Speaker 1: a hundred billion just about back in two thousand eight,

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Speaker 1: So it had a day or two in February where

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Speaker 1: almost trade as much. But you have to remember SPY

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Speaker 1: is much bigger than it was back then, so if

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Speaker 1: you adjust for the asset size two eight, you could

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Speaker 1: argue was two or three times more than anything that's happened,

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Speaker 1: since that's how mega that year was in certain days,

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Speaker 1: and there was even a month where SPY traded over

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Speaker 1: a trillion dollars into this day, that's the most it

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Speaker 1: ever traded in a month, which which month was that October?

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Speaker 1: That was the roughest month of the of the year.

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Speaker 1: So what what how much bigger is the et F

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Speaker 1: market now than it was ten years ago? Six times?

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Speaker 1: So now it's got three point six trillion and it

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Speaker 1: had about six billion back then. So that is why

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Speaker 1: that number, that dollar volume number, because when you make

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Speaker 1: a dollar volume, you adjust for the assets. So that's

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Speaker 1: that is an I mean, if you take six billion

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Speaker 1: and put into trillion, what is that that's the amount

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Speaker 1: of turnover that year in e t F. It's a

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Speaker 1: large number, way larger than normal. And Christine, can you

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Speaker 1: now that we know October was that that that month

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Speaker 1: with that volume, can you put us back in what

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Speaker 1: it was like then, Well, October, you're right, I mean

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Speaker 1: that was the most dire month. That was a month

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Speaker 1: where you know, so it was September every but you know,

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Speaker 1: Lehman got went bankrupt. Meryl was acquired by Bank of America.

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Speaker 1: A week later, Goldman and Morgan Stanley converted to bank

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Speaker 1: holding companies supervised by the FED. They also both got

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Speaker 1: equity injections. In Goldman's case it was from Warren Buffett

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Speaker 1: and uh Morgan Stanley's case it was from this Japanese bank. Um.

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Speaker 1: But it wasn't until October that Paulson then sent Secretary

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Speaker 1: of the Treasury Hank Paulson brought all the CEOs of

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Speaker 1: the nine biggest financial institutions at the time to Washington

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Speaker 1: and basically told them they were going to all get equity.

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Speaker 1: This was the tart the first round of the tarp,

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Speaker 1: and that was the point at which people started to

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Speaker 1: feel like, okay, there's a bottom to this. But right

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Speaker 1: up to that point, and that was Columbus Day. I remember,

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Speaker 1: it was a it was a national it was federal holiday.

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Speaker 1: Um so one of those convenient federal holidays where everybody

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Speaker 1: actually works, but yeah, exactly. The markets were open, I

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Speaker 1: think yeah, so um, but it was it was really unclear.

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Speaker 1: And there was also that vote in Congress I think

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Speaker 1: in early October before that when they voted down the

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Speaker 1: TARP originally, and that was I think you'll remember that

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Speaker 1: was when the market really went. That was one of

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Speaker 1: the worst days in the equities market we saw, and

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Speaker 1: then they reversed the vote. But I wouldn't be surprised

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Speaker 1: if that day when the vote on TARP, the first

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Speaker 1: vote on TARP happened, whether that wasn't the day when

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Speaker 1: you saw the biggest trading. And one thing to add

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Speaker 1: here is even though E t F s I think

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Speaker 1: got a good grade in two thousand eight were trading

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Speaker 1: and I think they did well. I just saw the

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Speaker 1: Turkey et F traded fine through all the drama. Briggs

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Speaker 1: that they did well, but they've had a couple problems.

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Speaker 1: August fifteen, that was that was some crazy days in

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Speaker 1: the market. That day, in particular, what happened was E

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Speaker 1: t F started trading at discounts. And it wasn't just

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Speaker 1: some exotic ones like X I V. There's been some

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Speaker 1: sort of exotic blow ups here and there, but this

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Speaker 1: was like Vanguard Dividend e t F, and I think

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Speaker 1: what what really is important remember here is as long

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Speaker 1: as the exchange is having pricing for the stocks and

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Speaker 1: the bond market is it available to investors, and there's

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Speaker 1: futures pricing. As long as these inputs are available to

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Speaker 1: market makers, ets will trade fine. I called that the

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Speaker 1: plumbing when the some hiccups start to emerge on August,

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Speaker 1: they had made rules from the flash crash that had limits.

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Speaker 1: So if an e t F started to trade, um,

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Speaker 1: I think it was belower above ten percent, they just

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Speaker 1: halted it. So what happens is stocks were halted, but

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Speaker 1: the e t F wasn't, and so market makers did

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Speaker 1: not know how to price what the e t F

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Speaker 1: was worth. That's the worst they've cleaned that up since then.

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Speaker 1: That's why Bragg's it did fine. But that's so I

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Speaker 1: just want to point out that e t f s

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Speaker 1: are they have a good record, but there have been

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Speaker 1: some cases. Usually it's involved if there's lack of pricing

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Speaker 1: in the underlying holdings of e t f s. That's

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Speaker 1: when you can have a problem with the e t

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Speaker 1: F trading. That's interesting because I think it was an

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Speaker 1: October two thousand night also when they halted sword sales

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Speaker 1: because the bank started complaining that their stocks were falling

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Speaker 1: to and uh and so it's interesting that e t

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Speaker 1: F survived that without any hiccups because that caused a

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Speaker 1: lot of issues. If that happens, the e t F

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Speaker 1: will trade, but it will move away from its fair value,

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Speaker 1: and sometimes that fair value is actually stale. It hasn't

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Speaker 1: taken into account like other data. Um, So the takeaway

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Speaker 1: here is that, uh, you know, they're not they are

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Speaker 1: vulnerable if in fact there's a problem with the anything

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Speaker 1: that they hold. Okay, Number three, we're gonna talk about active, right, Yeah,

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Speaker 1: because two thirds of active mutual funds underperformed the S

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Speaker 1: and P five. This was big for a couple of reasons. One,

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Speaker 1: the market was down, so you had to be really

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Speaker 1: bad to underperform it. That to me, I think left

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Speaker 1: the bad taste and a lot of investors mouths because

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Speaker 1: I think they thought, hey, look, I'm paying you this money.

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Speaker 1: Couldn't you have sidestep this at all? And you're seeing

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Speaker 1: some high profile people actually pull off, like, you know,

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Speaker 1: the biggest win of all time basically with some of

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Speaker 1: their bets. Yeah, and normally two thirds of active equity

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Speaker 1: funds will underperform the benchmark. But a lot of the

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Speaker 1: active managers will say, well, that's just because of quantitative

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Speaker 1: easing in this bull market, it's made it harder to outperform.

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Speaker 1: But this data shows that it's kind of doesn't matter

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Speaker 1: the market and the two thirds number, to me, is

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Speaker 1: really the cost issue. If you took away all their fees,

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Speaker 1: you'd have two thirds of them outperforming. So cost is

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Speaker 1: a big issue why they underperformed. But the other issue

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Speaker 1: is that active managers. I have empathy for them. If

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Speaker 1: you're an active equity fund, a lot of times you

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Speaker 1: you can't not hold these big stocks in the sp

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Speaker 1: because if you don't hold them when the market's going up,

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Speaker 1: you'll lag and get fired. So that's what's developed what's

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Speaker 1: called closet indexing. And I don't quite blame them because

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Speaker 1: advisors like something that mirrors the index, and so a

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Speaker 1: lot of them were just holding the same stock, so

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Speaker 1: there's no way they could have possibly sidestepped it when

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Speaker 1: they're holding the same thing perform and that's the conundrum

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Speaker 1: they're currently in. I mean, I'd talk of fund managers

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Speaker 1: all that year, and there was a sort of desire

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Speaker 1: on the part of a lot of them to believe

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Speaker 1: the worst was over. So you had the Barristern's collapse

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Speaker 1: in March, and then we interviewed financial stock investors who

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Speaker 1: were convinced, Okay, that's it, you know, let's get in,

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Speaker 1: and of course they got slaughtered. In the second half

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Speaker 1: of the year, the same thing. People were getting into

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Speaker 1: Fannie and Freddie convinced that there was no way it

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Speaker 1: would I mean, there were just nobody had ever seen

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Speaker 1: anything like this, so they kept jumping in trying to

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Speaker 1: catch this falling knife and getting burned by it. And

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Speaker 1: then and also I mean, I think, I think, I

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Speaker 1: think hedge funds didn't didn't prove themselves to be such

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Speaker 1: great hedges. And with a few very notable examples, and

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Speaker 1: here's one example. The worst of the big active funds

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Speaker 1: was Fidelity Magellan. It was down that year. That must

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Speaker 1: have been one of the falling knife catchers. Okay, number four.

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Speaker 1: Number four Gold showed the meaning of zero correlation. And

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Speaker 1: what I mean by that is gold is perceived as

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Speaker 1: a safe haven. Gold was up three percent that year,

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Speaker 1: so while it didn't go down, it didn't exactly offset

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Speaker 1: the losses in the SP correlated with anything correct, It's

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Speaker 1: got zero correlation, which interesting the next year when the

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Speaker 1: market rebounded, gold rebound rate with it. Well, I think

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Speaker 1: what it is correlated with is inflation fears, and so

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Speaker 1: as the central banks went in and started pumping in

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Speaker 1: liquidity late in two thousand eight early two thousand nine,

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Speaker 1: that's when you saw a lot of big investors say, oh,

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Speaker 1: this is a time to start hoarding gold and buying

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Speaker 1: real estate and preparing for you know, hyperinflation, which of

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Speaker 1: course by two thousand twelve they realized wasn't coming. And

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Speaker 1: I think that's true. Gold has a lot of currents

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Speaker 1: coming at it um. You know, there's there's emerging markets,

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Speaker 1: buyers that come in and weird you know. You I

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Speaker 1: learned to appreciate the zero correlation because it doesn't do

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Speaker 1: what anybody thinks it should do. And that's why I

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Speaker 1: think it's a decent diversifier, because it's that's special. Almost

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Speaker 1: everything is negative or positive correlation, but it's not. It's

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Speaker 1: a shaky hedge, and I think that's where it gets

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Speaker 1: miss characterized a lot. But what was a good hedge,

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Speaker 1: what really worked was long dated treasuries T l T

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Speaker 1: which is the twenty plus your treasury e t F

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Speaker 1: was up the exact same amount of the market was down,

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Speaker 1: So if you had long dated treasurys, you completely offset

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Speaker 1: your losses in the market. And the best performing e

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Speaker 1: t F that year was e d V, which is

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Speaker 1: an extended duration TRIST Treasury strips the duration on that's

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Speaker 1: like twenty seven years, so it has the highest interest

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Speaker 1: rate sensitivity possible. That was up fifty that year. And

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Speaker 1: as long as we're talking about performance, you pulled a

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Speaker 1: couple of other numbers that are sort of noteworthy to

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Speaker 1: write the VIX right. So the VIX was up and um,

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Speaker 1: their vix et p s are controversial because they always

361
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Speaker 1: they have role costs that can be a year. So

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Speaker 1: VXX is down since launching. However, in a crisis, that

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Speaker 1: role cost can turn into roll yield. So the VIX

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Speaker 1: Futures Index, which VXX tracks, because VXX wasn't around two,

365
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Speaker 1: it was up a hundred and twenty. In other words,

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Speaker 1: if you help vicks futures, enrolled them because the demand

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Speaker 1: for short term VIXED futures was so high, you actually

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Speaker 1: were buying low and selling high constantly, and you actually

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Speaker 1: made a one guy in his garage did that, Well,

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Speaker 1: that's like the black swan, right. Well, that to me,

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Speaker 1: I call that the jackpot potential. And that's why the

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Speaker 1: vix products are media proof. They've never gotten a good review.

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Speaker 1: They're like an Adam Sandler movie, like they've literally never

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Speaker 1: They always get trashed, but they see a lot of

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Speaker 1: volume because when they work, there's nothing like it um

376
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Speaker 1: where I like, I like when people UM give possible

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Speaker 1: black swans, I'm like, if you know it, it's not

378
00:19:35,440 --> 00:19:38,640
Speaker 1: the black swan, right, because you're being trading it, right, Yeah,

379
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Speaker 1: it's some unknown thing that we don't know. Okay. Number five,

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Speaker 1: the junk bond etf saw inflows of one point five billion.

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Speaker 1: I found this astonishing because h y G is the

382
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Speaker 1: big junk bond I don't know. In fact, what's interesting

383
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Speaker 1: is if you look at the h y G s

384
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Speaker 1: performance that year, it was okay until about October, and

385
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Speaker 1: then it went down thirty percent in ten weeks. I mean,

386
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Speaker 1: this was a blood bath. It was the It was

387
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Speaker 1: the reason people worry about junk bonds. This was the

388
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Speaker 1: kind of sell off that has people shorting junk bond

389
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Speaker 1: ETFs every now and then. In mass and it went

390
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Speaker 1: down that much, and there was a couple of days

391
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Speaker 1: of outflows, but mostly it saw inflows. There were buyers

392
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Speaker 1: apparently for the e t F at that time. I

393
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Speaker 1: don't remember. Again, I wasn't studying as it closely, but um,

394
00:20:28,640 --> 00:20:30,440
Speaker 1: that's when it saw its most inflows and then when

395
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Speaker 1: it hit that bottom boy, where the flow is really

396
00:20:32,760 --> 00:20:35,879
Speaker 1: coming in. So clearly there are these vulture type buyers

397
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Speaker 1: out there, which should give some comfort because h y

398
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Speaker 1: G to me is the canary in the coal mine

399
00:20:40,600 --> 00:20:42,760
Speaker 1: in terms of people worrying about the et F structure

400
00:20:43,119 --> 00:20:44,920
Speaker 1: because they're like, well, yeah, sure to can do equities,

401
00:20:44,960 --> 00:20:46,639
Speaker 1: but junk bond you can't really wrap that up. I

402
00:20:46,680 --> 00:20:48,720
Speaker 1: mean Carl Icon and Howard Marks had both come out

403
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Speaker 1: and said you cannot have a liquid instrument tracking something

404
00:20:50,760 --> 00:20:53,159
Speaker 1: in liquid. And it was a rough year. There was

405
00:20:53,200 --> 00:20:57,480
Speaker 1: premium discounts of eight percent, but it it survived, It

406
00:20:57,600 --> 00:21:00,840
Speaker 1: saw inflows, and then after that it's obviously built its

407
00:21:00,880 --> 00:21:03,760
Speaker 1: fan base. Was it relatively small at that stage? Yes,

408
00:21:04,240 --> 00:21:06,000
Speaker 1: I will say the small is a double edged sword,

409
00:21:06,040 --> 00:21:08,280
Speaker 1: because yes it was. And that's a great point you

410
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Speaker 1: bring up, because I will say that prims and discounts

411
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Speaker 1: and h YG have shrunk so much over the past

412
00:21:13,280 --> 00:21:15,159
Speaker 1: ten years because more and more market makers make a

413
00:21:15,240 --> 00:21:19,560
Speaker 1: market in it. However, h y G has vampired away

414
00:21:19,640 --> 00:21:22,040
Speaker 1: some of the liquidity from the high yield market. And

415
00:21:22,160 --> 00:21:24,000
Speaker 1: this is my big worry about et f s is

416
00:21:24,040 --> 00:21:26,840
Speaker 1: not the asset growing, it's the vampire of liquidity. Because

417
00:21:26,840 --> 00:21:29,040
Speaker 1: if more and more people just get lazy and say

418
00:21:29,040 --> 00:21:31,040
Speaker 1: I'm just going to trade h y G instead of

419
00:21:31,119 --> 00:21:35,320
Speaker 1: trading high yield debt myself because it's easier, that does

420
00:21:35,400 --> 00:21:37,240
Speaker 1: steal some of the liquidity. So we have a stat

421
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Speaker 1: that says h y G is still only two percent

422
00:21:39,280 --> 00:21:41,639
Speaker 1: ownership of all the junk bonds, but it accounts for

423
00:21:42,359 --> 00:21:44,320
Speaker 1: of all high yield debt trading today and it was

424
00:21:44,359 --> 00:21:47,280
Speaker 1: nowhere near those numbers back then. So on one hand,

425
00:21:47,320 --> 00:21:49,400
Speaker 1: there's more market makers watching it, which you could argue

426
00:21:49,480 --> 00:21:51,359
Speaker 1: is good, but another hand, it's way bigger part of

427
00:21:51,359 --> 00:21:54,520
Speaker 1: the market, which means there's probably arguably less liquidity in

428
00:21:54,520 --> 00:21:56,760
Speaker 1: the junk bonds. And this gets back to something I

429
00:21:56,800 --> 00:22:00,280
Speaker 1: think Christine can talk about, which is complacency that now,

430
00:22:00,320 --> 00:22:03,240
Speaker 1: I mean, you know, when everything's going up, as we've

431
00:22:03,280 --> 00:22:07,320
Speaker 1: just described, all of these products and everything going up

432
00:22:07,400 --> 00:22:11,040
Speaker 1: for the longest period. So everything was terrific in two

433
00:22:11,119 --> 00:22:14,879
Speaker 1: thousand and seven when all of the subprime c dos

434
00:22:14,920 --> 00:22:18,200
Speaker 1: seem to be performing and people weren't so worried, So

435
00:22:18,320 --> 00:22:20,520
Speaker 1: that's why people were loading up on them. But as

436
00:22:20,560 --> 00:22:23,800
Speaker 1: soon as it turns around, people were completely shocked at

437
00:22:23,840 --> 00:22:26,880
Speaker 1: how a liquid and how you know, little they understood

438
00:22:26,920 --> 00:22:30,920
Speaker 1: these products. And the fear I think is that E

439
00:22:31,040 --> 00:22:33,960
Speaker 1: t F have become such a part of the furniture

440
00:22:34,040 --> 00:22:36,480
Speaker 1: now people just assume they're always going to work. There's

441
00:22:36,560 --> 00:22:39,159
Speaker 1: no example of them failing in a big way, and

442
00:22:39,280 --> 00:22:42,280
Speaker 1: so people get complacent about that. And and yet the

443
00:22:42,359 --> 00:22:45,040
Speaker 1: market is morphing in really important ways, as you've been describing,

444
00:22:45,080 --> 00:22:48,080
Speaker 1: and so that could mean the whole landscape is extremely

445
00:22:48,119 --> 00:22:51,199
Speaker 1: different if and when as a classes fall, especially if

446
00:22:51,240 --> 00:22:53,639
Speaker 1: they've fallen some kind of correlated way. Yeah, and I

447
00:22:53,760 --> 00:22:56,200
Speaker 1: think E t F s right now, Um, they own

448
00:22:56,280 --> 00:22:59,000
Speaker 1: about eight percent of stocks, but the account for about

449
00:22:59,040 --> 00:23:03,040
Speaker 1: like I said, twenty five, the trading in a crisis,

450
00:23:03,320 --> 00:23:05,840
Speaker 1: as long as the stocks are trading, somebody can rbin.

451
00:23:05,880 --> 00:23:08,359
Speaker 1: The E t F investor will have a market. But

452
00:23:08,440 --> 00:23:11,520
Speaker 1: if there are no buyers for junk bonds for that time,

453
00:23:11,640 --> 00:23:14,159
Speaker 1: there's probably going to be a huge discount that uh

454
00:23:15,240 --> 00:23:17,080
Speaker 1: happens in H Y G or whatever E t F

455
00:23:17,119 --> 00:23:20,000
Speaker 1: it is. So I always tell people, ask yourself this question.

456
00:23:20,680 --> 00:23:22,560
Speaker 1: You have three choices. You can use the E t F,

457
00:23:22,920 --> 00:23:25,639
Speaker 1: you can use the active mutual fund, but that manager

458
00:23:25,640 --> 00:23:27,199
Speaker 1: will have to try to sell those securities the end

459
00:23:27,200 --> 00:23:30,080
Speaker 1: of the day anyway if you redeem. And the third

460
00:23:30,160 --> 00:23:32,960
Speaker 1: thing is do it yourself. So on a really hurricane

461
00:23:33,040 --> 00:23:35,840
Speaker 1: type day when the big one hits, which would you

462
00:23:36,000 --> 00:23:38,239
Speaker 1: rather try to sell? Because none of them are going

463
00:23:38,280 --> 00:23:40,440
Speaker 1: to be great, and so you sort of have to

464
00:23:40,520 --> 00:23:43,159
Speaker 1: just decide from there. And if you pick the E

465
00:23:43,280 --> 00:23:46,600
Speaker 1: t F knowing like all of that, it's good. But

466
00:23:46,640 --> 00:23:48,000
Speaker 1: if you go into the E t F thinking it

467
00:23:48,080 --> 00:23:51,840
Speaker 1: is utopia because it has traded so perfectly, I do

468
00:23:52,000 --> 00:23:55,440
Speaker 1: think you'll be disappointment disappointments because you went in there

469
00:23:55,520 --> 00:23:59,240
Speaker 1: thinking it's like this perfect magical vehicle, but in effect

470
00:23:59,320 --> 00:24:02,000
Speaker 1: it's not. So I also want to talk about a

471
00:24:02,080 --> 00:24:07,359
Speaker 1: few people who who doubled down in the midst of

472
00:24:07,400 --> 00:24:09,920
Speaker 1: all of this. Can we talk about that? Sure? Because

473
00:24:10,560 --> 00:24:14,040
Speaker 1: Vanguard in particular, what what happened when you looked at

474
00:24:14,080 --> 00:24:18,360
Speaker 1: those investors. This is this is unbelievable numbers. I was shocked.

475
00:24:19,160 --> 00:24:21,480
Speaker 1: Um Again, I looked this up because on Twitter, a

476
00:24:21,560 --> 00:24:24,239
Speaker 1: lot of people will say, oh, wait, till the big

477
00:24:24,320 --> 00:24:26,920
Speaker 1: one hits these passive investors, they're going to lose their marbles.

478
00:24:27,440 --> 00:24:30,240
Speaker 1: So I go back to Vanguard. Vanguard took in money

479
00:24:30,320 --> 00:24:34,520
Speaker 1: every month, including October. They took in ninety billion dollars

480
00:24:34,560 --> 00:24:37,359
Speaker 1: that year. The rest of the industry combine lost I

481
00:24:37,400 --> 00:24:40,119
Speaker 1: think about a hundred billion. It's in these times of

482
00:24:40,200 --> 00:24:44,280
Speaker 1: crisis that Vanguard UM sees their absolute flows go down

483
00:24:44,320 --> 00:24:46,440
Speaker 1: a little bit, but they increased their market share. That's

484
00:24:46,440 --> 00:24:48,399
Speaker 1: when they gobble up a little market share against the

485
00:24:48,720 --> 00:24:53,600
Speaker 1: other competitors. But I was stunned. This is navy seals

486
00:24:53,920 --> 00:24:56,800
Speaker 1: like disciplined if you're actually putting in money. In two

487
00:24:56,840 --> 00:25:03,199
Speaker 1: thousand eight October, Vanguard at acts really like hardcore discipline

488
00:25:03,320 --> 00:25:06,400
Speaker 1: bogel head type investors. Now, some people say since then

489
00:25:06,800 --> 00:25:10,119
Speaker 1: they've attracted more common folk who aren't like bogel heads,

490
00:25:10,520 --> 00:25:12,240
Speaker 1: and we'll we'll see if that plays out. But I

491
00:25:12,320 --> 00:25:14,760
Speaker 1: have seen these mini crisis Vanguard does seem to be

492
00:25:14,840 --> 00:25:19,679
Speaker 1: stickier than most. There's one other uh two eight anecdote

493
00:25:19,760 --> 00:25:22,080
Speaker 1: that I think, because we're talking about two th eight,

494
00:25:22,119 --> 00:25:24,280
Speaker 1: we have to bring up which was smart Bata was

495
00:25:24,359 --> 00:25:27,800
Speaker 1: around then, and there's a product called called PRF. And

496
00:25:27,840 --> 00:25:31,520
Speaker 1: we talked about this briefly before, but smart Beata basically

497
00:25:31,640 --> 00:25:36,119
Speaker 1: starts its process every quarter and then rebalances, and PRF

498
00:25:37,480 --> 00:25:39,720
Speaker 1: sauce up thing and took advantage of it. Do you

499
00:25:39,760 --> 00:25:41,959
Speaker 1: want to describe what happened? Yes, So in the industry

500
00:25:42,000 --> 00:25:45,840
Speaker 1: we call this the immaculate rebalance. That's just the best

501
00:25:45,920 --> 00:25:49,040
Speaker 1: name this is because if they don't have that on

502
00:25:49,119 --> 00:25:51,720
Speaker 1: their shirts and hand get credit to Ben Johnson at morning.

503
00:25:51,720 --> 00:25:53,600
Speaker 1: Sorry he came up with it, but it's it's actually

504
00:25:53,760 --> 00:25:57,159
Speaker 1: really fascinating. In two thousand eight, let's face it, it

505
00:25:57,280 --> 00:26:00,240
Speaker 1: was it was a tough to buy bank stocks. If

506
00:26:00,280 --> 00:26:02,160
Speaker 1: you're an active manager, you probably fired on the spot

507
00:26:02,240 --> 00:26:05,040
Speaker 1: if you went in and bought City Group, right. Well,

508
00:26:05,480 --> 00:26:09,320
Speaker 1: smart data products are just active but put into a

509
00:26:09,400 --> 00:26:11,960
Speaker 1: rules based index, so they're like robots. They have to

510
00:26:12,080 --> 00:26:14,400
Speaker 1: just screen the stocks every quarter, and if they're cheap

511
00:26:14,960 --> 00:26:17,120
Speaker 1: and they passed the screens, they have to buy them. Well,

512
00:26:17,160 --> 00:26:19,800
Speaker 1: PRF is a smart data product and it it bought

513
00:26:19,880 --> 00:26:22,040
Speaker 1: up all these bank stocks in late two thousand eight

514
00:26:22,080 --> 00:26:24,280
Speaker 1: to the point where it had fifty financials in two

515
00:26:26,160 --> 00:26:28,760
Speaker 1: As we've said before, it's like walking into the burning building. Yeah,

516
00:26:28,760 --> 00:26:31,920
Speaker 1: oh yeah, yeah, and we trace PRF in the next

517
00:26:32,280 --> 00:26:34,520
Speaker 1: I think it was like six to seven years that

518
00:26:34,680 --> 00:26:39,119
Speaker 1: one trade, that one rebalance accounted for just tons of

519
00:26:39,200 --> 00:26:41,720
Speaker 1: alpha that kept giving for years and years and years

520
00:26:41,760 --> 00:26:44,399
Speaker 1: after that. And what's interesting is the guy who runs

521
00:26:44,520 --> 00:26:48,879
Speaker 1: that index, which power Shares license had institutions using that

522
00:26:49,000 --> 00:26:51,760
Speaker 1: index in separate accounts. They called him up and said,

523
00:26:51,800 --> 00:26:54,040
Speaker 1: do not do the rebounds. We're not buying City Group,

524
00:26:54,080 --> 00:26:56,119
Speaker 1: and so he didn't, and of course the et F

525
00:26:56,200 --> 00:27:00,200
Speaker 1: outperformed the s m A and that I think it's

526
00:27:00,320 --> 00:27:02,879
Speaker 1: value to the robotic nature of smart beta. But my

527
00:27:03,080 --> 00:27:05,240
Speaker 1: colleague Ben will bring up that a lot of investors

528
00:27:05,280 --> 00:27:08,200
Speaker 1: were unable to hang in there in PRF, So the

529
00:27:08,560 --> 00:27:11,000
Speaker 1: this brings up behavior and the importance of hanging in there.

530
00:27:11,040 --> 00:27:12,760
Speaker 1: If you pick a strategy and you like it, you

531
00:27:12,800 --> 00:27:16,320
Speaker 1: gotta stick with it. I mean, what what was it?

532
00:27:16,520 --> 00:27:19,560
Speaker 1: Was there any robout buying Lehman Brothers but in sort

533
00:27:19,560 --> 00:27:24,760
Speaker 1: of July or August, I'd have to see if it checked.

534
00:27:24,800 --> 00:27:26,480
Speaker 1: That's a good question. That's a good research note. I

535
00:27:26,520 --> 00:27:29,520
Speaker 1: don't know if Lehman would have checked off momentum, but

536
00:27:30,000 --> 00:27:32,879
Speaker 1: Lehman fell right so fast that it didn't even it

537
00:27:32,880 --> 00:27:35,239
Speaker 1: would have been a quarter because these things usually look

538
00:27:35,280 --> 00:27:38,399
Speaker 1: over quarters or semi annually. It wouldn't have become a

539
00:27:38,480 --> 00:27:40,960
Speaker 1: value stock for long, right, Like it didn't. We didn't

540
00:27:41,040 --> 00:27:43,000
Speaker 1: hang it like a low p for a long time,

541
00:27:43,200 --> 00:27:45,680
Speaker 1: depending on when the robot resets, right, But it's possible.

542
00:27:45,720 --> 00:27:47,320
Speaker 1: But I just did recall seeing some of the bigger

543
00:27:47,320 --> 00:27:50,879
Speaker 1: banks in there that have gone yeah, yeah, yeah, I

544
00:27:50,960 --> 00:27:53,639
Speaker 1: remember distinctly going for drinks with somebody who was a

545
00:27:54,160 --> 00:27:57,840
Speaker 1: consultant and he was he was bragging to me about

546
00:27:57,840 --> 00:27:59,760
Speaker 1: how he just loaded up in Fannie and Freddie because

547
00:27:59,760 --> 00:28:02,119
Speaker 1: it was so low. I couldn't go any lower, you know,

548
00:28:03,600 --> 00:28:07,960
Speaker 1: very very badly. You know, this idea of buying stuff cheap,

549
00:28:08,080 --> 00:28:11,200
Speaker 1: it's it is really tempting. We see this all the

550
00:28:11,320 --> 00:28:15,320
Speaker 1: time with with stocks. And my wife actually like she

551
00:28:15,400 --> 00:28:18,080
Speaker 1: wants to buy J. C. Penny and she's just she's

552
00:28:18,080 --> 00:28:20,600
Speaker 1: like a natural value investor and I understand that, but

553
00:28:21,320 --> 00:28:27,320
Speaker 1: you know, it can go lower the floor there's a

554
00:28:27,359 --> 00:28:30,200
Speaker 1: trap door, but I mean there were yeah, I mean there,

555
00:28:30,480 --> 00:28:32,000
Speaker 1: I think one of the you know, several of the

556
00:28:32,040 --> 00:28:35,639
Speaker 1: hedge fund managers sort of made their names also for

557
00:28:35,880 --> 00:28:39,000
Speaker 1: recognizing that some of these banks, for instance, we're not

558
00:28:39,160 --> 00:28:41,560
Speaker 1: going to be allowed to fail, right, and so City

559
00:28:41,600 --> 00:28:44,200
Speaker 1: Group was a good investment because there was no way

560
00:28:44,320 --> 00:28:46,720
Speaker 1: the government was going to let it fail. Christine, can

561
00:28:46,800 --> 00:28:48,520
Speaker 1: we bring it back and you can help us maybe

562
00:28:48,560 --> 00:28:51,240
Speaker 1: put a bow on all of this. You were on

563
00:28:51,280 --> 00:28:54,880
Speaker 1: the front lines. You've seen how everything's evolved for ten years.

564
00:28:54,920 --> 00:28:58,120
Speaker 1: You've seen Eric stats. Now can you help us make

565
00:28:58,160 --> 00:29:00,640
Speaker 1: sense of this? What what's the takeaway that you get

566
00:29:00,800 --> 00:29:03,120
Speaker 1: from this conversation that we thought? Well, for me one

567
00:29:03,160 --> 00:29:06,160
Speaker 1: of the biggest lessons of the financial crisis. Having been

568
00:29:06,280 --> 00:29:11,120
Speaker 1: a reporter covering financial companies at that point for maybe

569
00:29:12,000 --> 00:29:15,360
Speaker 1: five six years, I was pretty convinced that these people

570
00:29:15,400 --> 00:29:17,840
Speaker 1: all knew what they were doing. They're they're very smart,

571
00:29:17,920 --> 00:29:23,800
Speaker 1: they're highly sophisticated, very numerous, very data driven, and I

572
00:29:24,080 --> 00:29:28,400
Speaker 1: was shocked the number of them who were completely taken

573
00:29:28,480 --> 00:29:30,680
Speaker 1: by surprise and didn't see it coming at all and

574
00:29:30,760 --> 00:29:34,480
Speaker 1: actually didn't really understand how things worked. So it gave

575
00:29:34,520 --> 00:29:38,000
Speaker 1: me a sort of much more skeptical view of the

576
00:29:38,400 --> 00:29:41,200
Speaker 1: experts in the financial industry. I mean, you know, people

577
00:29:41,240 --> 00:29:44,120
Speaker 1: who were running these firms really didn't know what was happening.

578
00:29:44,640 --> 00:29:48,200
Speaker 1: So I get I just kind of always keep that

579
00:29:48,280 --> 00:29:49,960
Speaker 1: in the back of my mind, no matter how good

580
00:29:50,080 --> 00:29:52,280
Speaker 1: something sounds, and no matter how well it's worked. I

581
00:29:52,560 --> 00:29:56,040
Speaker 1: I think it's always a good idea to remain somewhat

582
00:29:56,080 --> 00:29:58,719
Speaker 1: skeptical and do your own homework. And the people who

583
00:29:58,800 --> 00:30:00,680
Speaker 1: came out looking smart of the people who ask the

584
00:30:00,760 --> 00:30:04,720
Speaker 1: most questions and to that point, you know, uh. In

585
00:30:04,960 --> 00:30:07,680
Speaker 1: going back to the very podcast, when he talked about

586
00:30:07,720 --> 00:30:10,120
Speaker 1: why he thought Passive got so big, he did bring

587
00:30:10,240 --> 00:30:14,040
Speaker 1: up these large sell offs where it did the experts

588
00:30:14,120 --> 00:30:16,440
Speaker 1: did look a little bit like the Emperor wearing no clothes,

589
00:30:16,840 --> 00:30:19,080
Speaker 1: and that over and over, I think is where you

590
00:30:19,160 --> 00:30:21,640
Speaker 1: have a lot of investors going, you know what, screw it.

591
00:30:21,720 --> 00:30:23,480
Speaker 1: I'm just gonna put it in this like dirt cheap

592
00:30:23,600 --> 00:30:26,080
Speaker 1: SMP thing and then that that's all I'm doing. But

593
00:30:26,200 --> 00:30:28,400
Speaker 1: there is some concern if everybody feels like that and

594
00:30:28,440 --> 00:30:31,480
Speaker 1: there's a crowd into this one, you know, dirt cheap

595
00:30:31,600 --> 00:30:34,720
Speaker 1: SMP trade, that's I think where I have to think

596
00:30:34,720 --> 00:30:38,000
Speaker 1: there's some credence the SMP in particular, that index is

597
00:30:38,120 --> 00:30:41,480
Speaker 1: so all powerful because it's it's big and passive, but

598
00:30:41,560 --> 00:30:45,520
Speaker 1: also active managers are orbiting around it too, and I

599
00:30:45,600 --> 00:30:47,840
Speaker 1: think that is where there's some legitimacy to it. But

600
00:30:47,880 --> 00:30:50,160
Speaker 1: I agree with you. I think if you just judge

601
00:30:50,240 --> 00:30:54,760
Speaker 1: this stuff not versus not versus reality, and you think

602
00:30:54,800 --> 00:30:56,880
Speaker 1: of the other options available to you to get exposure

603
00:30:57,200 --> 00:30:59,440
Speaker 1: when you make a choice that way, I think it's

604
00:30:59,560 --> 00:31:02,200
Speaker 1: much better our approach than just buying it because you

605
00:31:02,240 --> 00:31:04,720
Speaker 1: saw commercial or you know, you heard somebody talk about it.

606
00:31:04,920 --> 00:31:08,920
Speaker 1: Everybody else is doing it, right, Christine. One final thing,

607
00:31:09,080 --> 00:31:11,760
Speaker 1: can we talk about your book for a second. What's

608
00:31:11,800 --> 00:31:14,120
Speaker 1: it called? It's First of all, I will say it's

609
00:31:14,160 --> 00:31:18,360
Speaker 1: not My book helped Paul right the right his memoir

610
00:31:19,120 --> 00:31:21,000
Speaker 1: um so he has written the story of his life.

611
00:31:21,040 --> 00:31:23,440
Speaker 1: He's almost ninety one years old. And for those who

612
00:31:23,520 --> 00:31:25,880
Speaker 1: are not familiar with Paul Volker, so, Paul Vulgar was

613
00:31:25,960 --> 00:31:28,840
Speaker 1: the chairman of the Federal Reserve. He killed in the

614
00:31:29,120 --> 00:31:32,200
Speaker 1: hyper and we're not quite hyper inflation, but serious inflation

615
00:31:32,240 --> 00:31:34,200
Speaker 1: problem we had in the United States in the late

616
00:31:34,280 --> 00:31:37,360
Speaker 1: seventies early eighties. And he's a very important rule named

617
00:31:37,360 --> 00:31:39,640
Speaker 1: after him. He has the Vulcar rule named after him

618
00:31:39,680 --> 00:31:43,320
Speaker 1: because he was really he was shocked and horrified during

619
00:31:43,320 --> 00:31:46,120
Speaker 1: the financial crisis and how everything suddenly got treated as

620
00:31:46,200 --> 00:31:48,120
Speaker 1: it was a bank. Right, banks are supposed to be

621
00:31:48,160 --> 00:31:50,960
Speaker 1: special entities, right that you have special rules, I have

622
00:31:51,040 --> 00:31:53,880
Speaker 1: special protections. Suddenly of Goldman, SAX and mor eanxamily were

623
00:31:53,880 --> 00:31:57,240
Speaker 1: treated like banks. Suddenly all mutual fund money market mutual

624
00:31:57,280 --> 00:31:59,719
Speaker 1: funds were treated like banks. Everything was getting bailed out

625
00:31:59,720 --> 00:32:02,680
Speaker 1: as was a bank. And he thought this was a problem,

626
00:32:02,880 --> 00:32:05,280
Speaker 1: which I think a lot of people do, and uh,

627
00:32:05,520 --> 00:32:07,200
Speaker 1: and wanted to make a distinction. You know, if you're

628
00:32:07,200 --> 00:32:10,239
Speaker 1: a bank, there should be certain things protections you get

629
00:32:10,280 --> 00:32:13,560
Speaker 1: because you're important, you're kind of utility for our society.

630
00:32:13,960 --> 00:32:16,760
Speaker 1: But you shouldn't put yourself at undue risk. And that's

631
00:32:16,760 --> 00:32:19,840
Speaker 1: a vocal rule. But anyway, so but he covers everything,

632
00:32:20,160 --> 00:32:23,720
Speaker 1: you know, the end of Bretton Woods, you're fighting inflation,

633
00:32:24,520 --> 00:32:28,440
Speaker 1: financial rulemaking, his personal life story, lots of things he

634
00:32:28,480 --> 00:32:30,240
Speaker 1: did after he left the FED, and so it's a

635
00:32:30,320 --> 00:32:31,480
Speaker 1: it's a good book. And he does it all in

636
00:32:31,520 --> 00:32:33,680
Speaker 1: about three pages, so it's not along yet and the

637
00:32:33,720 --> 00:32:37,200
Speaker 1: books called keeping at It and it comes out. It

638
00:32:37,280 --> 00:32:40,200
Speaker 1: comes out in November seven, can wit good Christmas gift.

639
00:32:44,440 --> 00:32:47,320
Speaker 1: Thanks for listening Trillions until next time. You can find

640
00:32:47,400 --> 00:32:51,120
Speaker 1: us on the Bloomberg Terminal, Bloomberg dot com, Apple Podcast,

641
00:32:51,520 --> 00:32:53,959
Speaker 1: and where else you would like to listen. We'd love

642
00:32:54,000 --> 00:32:56,880
Speaker 1: to hear from you. We're on Twitter, I'm at Joel

643
00:32:56,920 --> 00:33:00,520
Speaker 1: Weber Show, He's at Eric Baltunas, and you can find

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Speaker 1: Christina Harper at the cr Underscore. Harper Trillions is produced

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Speaker 1: by Magnus Hendrickson. Francesca Levy is the head of Bloomberg

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Speaker 1: podcast by