WEBVTT - No Complexity in Closing Eclectica Fund, Hendry Says 0:00:09.720 --> 0:00:12.880 Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene with 0:00:13.600 --> 0:00:16.560 David Gura. Daily we bring you insight from the best 0:00:16.560 --> 0:00:22.279 of economics, finance, investment, and international relations. Find Bloomberg Surveillance 0:00:22.320 --> 0:00:27.000 on Apple Podcasts, SoundCloud, Bloomberg dot Com, and of course 0:00:27.320 --> 0:00:35.199 on the Bloomberg Good morning everyone, Bloomberg Surveillance, David Gurratt 0:00:35.560 --> 0:00:38.239 and Tom Keene in New York. We're going to go 0:00:38.320 --> 0:00:40.599 to a most important interview. Good morning to all of 0:00:40.640 --> 0:00:43.960 you of Global Wall Street and David, this really frames 0:00:44.400 --> 0:00:49.680 out the struggle for all of investment, conservative, boring, mutual 0:00:49.760 --> 0:00:54.240 fund managers, everyone in every flavor of hedge fund and 0:00:54.320 --> 0:00:56.600 you see it when I quote the VIX ten point 0:00:56.760 --> 0:00:59.920 seven one. We look at foreign exchange vix, we look 0:01:00.120 --> 0:01:04.000 fixed income volatility. The dampening and quiet of the market 0:01:04.640 --> 0:01:08.480 is challenging for everyone. In conversations at Cantor Fitzgerald on 0:01:08.959 --> 0:01:11.640 September eleven and that charity event, you talked to the 0:01:11.680 --> 0:01:15.280 people in the trenches, and I'll tell you, David, it's 0:01:15.360 --> 0:01:20.440 it's a trade to trade of quiet through two thousand seventeen. 0:01:21.360 --> 0:01:24.000 Hugh Henry Georges now from our studios in London. He 0:01:24.360 --> 0:01:26.640 the manager of a collect gasset management, announced in a 0:01:26.720 --> 0:01:29.880 letter yesterday that that fund closing after fifteen years. Great 0:01:29.880 --> 0:01:31.800 to have you with us here on bloom brigs Veils. 0:01:31.800 --> 0:01:34.080 Appreciate the time this morning. Let's just start with the 0:01:34.080 --> 0:01:37.280 motivations for for doing this, the complexity, the global complexity 0:01:37.280 --> 0:01:39.320 that led you to make this decision and tell your 0:01:39.319 --> 0:01:43.600 investors this yesterday. But there was absolutely no complexity. Um. 0:01:43.680 --> 0:01:47.120 I'd like to think in my life I've done things differently, 0:01:47.360 --> 0:01:49.640 don't I don't want to sign like Frank Sinatra. Um, 0:01:49.720 --> 0:01:53.840 but in my messages, I died and in act of combat, 0:01:53.960 --> 0:01:57.960 if you go, I died having a goal. Um. I 0:01:58.000 --> 0:02:01.560 think what we've seen. Uh, A lot of my contemporaries 0:02:02.480 --> 0:02:06.240 like we're rich, we're tired, we're fed up, and just 0:02:06.480 --> 0:02:08.880 kind of you know, slipped out of the back door. 0:02:09.200 --> 0:02:12.000 I wanted to go out with a buying if you will, 0:02:12.040 --> 0:02:14.880 when I went together saying I see the word it's huge. 0:02:15.000 --> 0:02:17.360 I have these trades. I'm here and let me. I 0:02:17.360 --> 0:02:21.280 think you're missing this. Let's have this dialogue. It just 0:02:21.440 --> 0:02:25.079 the economics and there's nothing complex. Yeah, you no inks, 0:02:25.120 --> 0:02:28.320 but against me you Good morning wonderful to come on 0:02:28.360 --> 0:02:31.400 with us at Global Wall Street. Listen. You know, across 0:02:31.480 --> 0:02:34.919 all of our radio you said the Lionel Barber's rag 0:02:35.160 --> 0:02:39.840 five years ago. We're harshly disciplined by market trends. You 0:02:39.880 --> 0:02:43.760 will never see us pursue a homegrown idea to the 0:02:43.840 --> 0:02:47.720 detriment of the prevailing trend. The trend hasn't been there 0:02:47.800 --> 0:02:51.119 with a damp and vall across all asset classes. Are 0:02:51.160 --> 0:02:55.800 you a victim of the dampening of Janet Yellen, John Karney, 0:02:56.280 --> 0:03:01.200 Mr Corona and Mr drug Um. Far from me to 0:03:01.200 --> 0:03:04.920 to play my violin and claim to be a victim, 0:03:04.919 --> 0:03:09.800 but certainly I believe they're whier forces to play, because 0:03:10.040 --> 0:03:12.440 this is not a story about individuals. This is a 0:03:12.480 --> 0:03:16.519 genetic story about a great group of some of the 0:03:16.560 --> 0:03:20.960 most provocative and fantastic brains in the world. Who has 0:03:20.960 --> 0:03:24.519 a group since two thousand and twelve really have consistently 0:03:24.600 --> 0:03:27.720 failed to produce Brits Well? But I made the key 0:03:27.760 --> 0:03:30.320 distinction this morning, hum, and I think this is critically 0:03:30.360 --> 0:03:34.200 important in the mathematics failure. You didn't blow up. I mean, 0:03:34.200 --> 0:03:36.400 you're down nine percent this year. I get that, But 0:03:36.600 --> 0:03:40.400 you didn't blow up this is a sequence of frankly 0:03:40.800 --> 0:03:46.680 good subpar returns. How do we end that and get 0:03:46.720 --> 0:03:50.240 back to alpha generation or alpha lass? I mean, somebody loses, 0:03:50.520 --> 0:03:53.240 but how do we get back to so called normal 0:03:53.600 --> 0:03:56.120 where the game is fair when you wake up in 0:03:56.160 --> 0:03:59.800 the morning. Well, I'm not arguing that the game is unfair. 0:04:00.040 --> 0:04:03.680 I would actually say that global macro enjoyed a moment 0:04:03.800 --> 0:04:08.240 in time which where the fortunes and the great performance 0:04:08.280 --> 0:04:13.600 of the protagonists perhaps owed much to the context. I 0:04:13.640 --> 0:04:18.120 believe that we had that inflation drama in the nineteen seventies, 0:04:18.400 --> 0:04:22.719 and for three at least three decades, if not forty years, 0:04:22.760 --> 0:04:26.000 it remained long in the market memory, if you will, 0:04:26.080 --> 0:04:28.560 that we could return to such an environment. It was 0:04:28.600 --> 0:04:31.440 also there with the Fed. I mean remember as early 0:04:31.440 --> 0:04:35.120 as back in the taper transroom of two thousand and thirteen, 0:04:35.400 --> 0:04:39.400 the FED was proposing to tighten its policy. With the 0:04:39.480 --> 0:04:42.280 national unemployment where it's seven and a half percent and 0:04:42.320 --> 0:04:45.360 with no credible sign of inflation, we've just been on 0:04:45.440 --> 0:04:48.800 this high alert now. The The result of that has 0:04:48.800 --> 0:04:53.159 been that for decades, the real recurn on US treasury 0:04:53.160 --> 0:04:56.600 bonds were very, very high, and the macro model was 0:04:56.680 --> 0:04:59.719 simple you come in, you leverage those returns, you get 0:04:59.720 --> 0:05:02.640 a a high risk adjusted return. It pays for the 0:05:02.680 --> 0:05:05.680 commercial cost of running the business, and it pays for 0:05:05.800 --> 0:05:10.440 taking like buying convective Veer puts on fixed income or 0:05:10.560 --> 0:05:13.800 equity Marcus, and periodically they go in your favor and 0:05:13.920 --> 0:05:18.000 everyone thinks you're a rock star. Now quantitative easing. Now, 0:05:18.279 --> 0:05:21.280 I estimate the ten year real treasury bond yards are 0:05:21.480 --> 0:05:26.039 zero point three pc. So even leveraging that which I advise, 0:05:26.120 --> 0:05:29.440 because they see, you know, well that's where we are. 0:05:30.040 --> 0:05:32.760 When do you envision the young kids see a phase? 0:05:33.160 --> 0:05:36.080 When do they get to play again? Because we've seen 0:05:36.320 --> 0:05:40.599 X number of years of this dampened idea. When does 0:05:40.640 --> 0:05:45.400 the game get fun again? Well, the game gets and 0:05:45.480 --> 0:05:48.440 you know the game will get fun again. But I 0:05:48.480 --> 0:05:50.920 think I always look at the irony and the paradox 0:05:51.000 --> 0:05:54.200 of of the path that the world chooses to take. 0:05:55.240 --> 0:05:57.880 It will become relevant again because there will be a 0:05:57.960 --> 0:06:03.320 moment when people will call upon diversifying us as they 0:06:03.360 --> 0:06:06.360 were discovered, to their great horror, their U S treasuries 0:06:06.400 --> 0:06:09.520 are not doing the job, and so they will be 0:06:09.560 --> 0:06:11.960 calling upon global micro but they'll be looking at their 0:06:12.120 --> 0:06:14.440 allocation they'll be saying, you'd be used to see where 0:06:14.440 --> 0:06:17.120 all the customers. Yachts will be saying where all the 0:06:17.200 --> 0:06:20.039 micro managers, and he might retore on the yachts, but 0:06:20.279 --> 0:06:26.560 you know where we are. We're de scaling portfolio, diversifying subsector. 0:06:26.760 --> 0:06:28.719 You don't be a stranger when you're in New York 0:06:28.720 --> 0:06:30.839 when you take the conquered. He's the only one still 0:06:30.880 --> 0:06:34.200 talk the concord when when you take the conquered over 0:06:34.320 --> 0:06:36.880 your private golf stream. Please stop by in New York. 0:06:36.920 --> 0:06:39.279 We'd love to talk to you for a longer conversation, 0:06:39.360 --> 0:06:42.479 or when we're in London. Mr Henry shutting down his 0:06:42.520 --> 0:06:46.919 hedge fund yesterday really global, major global news for Global 0:06:46.960 --> 0:06:50.960 Wall Street. David, I really can't convey enough. He didn't 0:06:50.960 --> 0:06:54.280 blow up. That's the news here. He didn't blow up. 0:06:54.400 --> 0:06:58.480 It was just the dampening. I can honestly say, I've 0:06:58.520 --> 0:07:01.640 never seen this, David. There you go invoking Frank Sinatra regrets. 0:07:01.640 --> 0:07:03.760 I've had a few. Hugh Henre great to speak with 0:07:03.800 --> 0:07:05.800 him exclusively here on Bloomberg this morning, on the heels 0:07:05.800 --> 0:07:08.560 of that news. This is Bloomberg Surveillance. On Bloomberg Radio, 0:07:08.600 --> 0:07:10.840 David Gura and Tom Keane in New York coast to 0:07:10.920 --> 0:07:26.280 coast and worldwide. Ben Carton has been in the U. S. 0:07:26.280 --> 0:07:28.920 Senate since two thousand seven. Before that, he represented third 0:07:28.960 --> 0:07:31.720 District in Maryland in the U. S. House of Representatives. 0:07:31.920 --> 0:07:34.440 He's now the ranking member of the Senate form Relations Committee. 0:07:34.480 --> 0:07:35.840 Joins us now on our phone lines on a day 0:07:35.840 --> 0:07:39.520 when we are keenly focused on what's happening in the Pacific. 0:07:39.560 --> 0:07:42.160 Of course, another nuclear sorry, another missile test last last 0:07:42.200 --> 0:07:45.320 night by a North Korea intermediate range ballistic missile shot 0:07:45.320 --> 0:07:48.560 a distance farther than the distance between North Korea and Guam, 0:07:48.600 --> 0:07:52.160 a protectorate that country has threatened several times now, Senator Carten, 0:07:52.200 --> 0:07:53.720 great to speak with you. I look at the President's 0:07:53.720 --> 0:07:56.800 schedule today, your colleague on the Senate Formulations Committee, Senator 0:07:56.840 --> 0:07:58.760 Bob Corker of Tennessee, is going to be meeting with 0:07:58.840 --> 0:08:01.360 the President today. I wonder if you have any insight 0:08:01.400 --> 0:08:03.119 into what the two of them will be talking about, 0:08:03.160 --> 0:08:04.640 and if you could tell us a bit about the 0:08:04.720 --> 0:08:07.440 kind of interface you've had with this administration on issues 0:08:07.480 --> 0:08:10.440 like these thus far. Well, first of all, good morning, 0:08:10.480 --> 0:08:13.720 and I'm certain that Senator Corker will be talking about 0:08:13.800 --> 0:08:16.640 North Korea as one of the subjects on the agenda 0:08:16.680 --> 0:08:20.480 with the President. We've I've had discussions with the members 0:08:20.480 --> 0:08:23.240 of the Trump administration and North Korea and other issues. 0:08:23.720 --> 0:08:27.200 But clearly, this most recent tests confirms the fact that 0:08:27.280 --> 0:08:31.400 North Korea not only has the nuclear weapon, but they 0:08:31.400 --> 0:08:34.200 are developing the means of which it could be delivered 0:08:34.600 --> 0:08:37.120 um not just in the region, but beyond the region. 0:08:37.240 --> 0:08:40.360 So it's a matter of it's extremely dangerous and it's 0:08:40.400 --> 0:08:43.560 a it's an urgent issue for the United States to 0:08:43.559 --> 0:08:47.040 to change its game plan from the point of view 0:08:47.280 --> 0:08:51.120 of I believe starting a diplomatic surge working with China 0:08:51.320 --> 0:08:54.080 that changed the equation. As you watch all of these tests, 0:08:54.080 --> 0:08:55.760 and I think there have been thirteen or fourteen of 0:08:55.760 --> 0:08:58.720 them this year alone, do you regard them as tests, 0:08:58.720 --> 0:09:02.400 as North Korea trying out to or showcasing technology they've developed, 0:09:02.480 --> 0:09:06.080 or these simply provocations to you? How do you view them? 0:09:06.240 --> 0:09:09.319 I believe that they want to have a functional UH 0:09:09.520 --> 0:09:16.080 nuclear arsenal that is capable of reaching the US and 0:09:16.080 --> 0:09:19.800 our allies. This they look at this as an ability 0:09:20.000 --> 0:09:24.679 to prevent the United States from UH affecting their regime. 0:09:25.160 --> 0:09:28.000 But you never know how these weapons could be used. 0:09:28.000 --> 0:09:31.640 It's a it's it's a regime that's unpredictable. It violates 0:09:31.640 --> 0:09:36.040 international mall. So our objective is to prevent a North 0:09:36.120 --> 0:09:39.800 Korea from destabilizing the region in our our interest, and 0:09:40.160 --> 0:09:44.040 that means freezing and hopefully eliminating their nuclear weapon program. 0:09:44.160 --> 0:09:47.560 The Senor cardon Good Morning, I think Maryland is possibly 0:09:47.600 --> 0:09:52.319 the most misunderstood state in the country. Cumberland, Maryland, hundred 0:09:52.440 --> 0:09:56.720 thirty eight miles away from your Baltimore went plus vote 0:09:56.760 --> 0:10:00.800 for President Trump. When you travel out to west astern Maryland, 0:10:01.360 --> 0:10:03.800 what do you see as the reaction to the follies 0:10:03.840 --> 0:10:07.720 of your Washington over the last two or three days. 0:10:07.800 --> 0:10:10.720 What's the response you as a die Aard Baltimore Democrat, 0:10:11.200 --> 0:10:15.440 what do you see in Republican Maryland? Well, you know, 0:10:15.480 --> 0:10:18.800 Maryland is called American miniature. We have the mountains of 0:10:18.880 --> 0:10:23.000 Western Maryland, we have the beaches of eastern Shore. Uh. Clearly, 0:10:23.080 --> 0:10:26.280 the western part of our state is more politically conservative 0:10:26.360 --> 0:10:30.080 than either the Baltimore or Warsington regions, which is much 0:10:30.120 --> 0:10:34.880 more progressive. Uh. It's the western part is traditional conservative 0:10:34.920 --> 0:10:38.400 areas of our state. Uh. They're good people. If they wavered, 0:10:38.559 --> 0:10:41.240 they wavered on the president. If they wavered on the president, 0:10:42.080 --> 0:10:43.640 I think if you, if you, if you deal with 0:10:43.679 --> 0:10:47.080 the issues. They're certainly disagreeing with a lot of the 0:10:47.160 --> 0:10:50.840 policies that have been proposed by the Trump administration, and 0:10:50.880 --> 0:10:52.760 they are certainly against a lot of the language the 0:10:52.760 --> 0:10:57.480 president is used. Whether that would translate into votes that 0:10:57.480 --> 0:11:00.240 would but against the president, I don't know, but I 0:11:00.679 --> 0:11:03.240 do believe there is disagreement with a manner in which 0:11:03.240 --> 0:11:06.040 the President is conducting his affairs. Sender Kardin, You're gonna 0:11:06.040 --> 0:11:08.760 get through the weekend. On Tuesday. Next week there's a 0:11:08.880 --> 0:11:12.040 nominations hearing before the Senate to Form Relations Committee. The 0:11:12.040 --> 0:11:14.120 Honorable John Huntsman is going to be sitting down taking 0:11:14.160 --> 0:11:16.679 questions from you and your colleagues. He of course nominated 0:11:16.720 --> 0:11:20.160 to be the next ambassador to Russia. How much is 0:11:20.160 --> 0:11:24.280 is his nomination clouded by the the scandal involving Russian 0:11:24.280 --> 0:11:26.760 interference in the US presidential election? And what questions do 0:11:26.800 --> 0:11:28.800 you have for him about how he's going to move 0:11:28.840 --> 0:11:33.240 forward if in fact he's confirmed. Well, Mr Hudson is 0:11:33.280 --> 0:11:36.600 well qualified to the ambassador to Russia. He is a 0:11:36.640 --> 0:11:39.719 person who is well respected by both Democrats and Republicans. 0:11:40.160 --> 0:11:43.120 I'm pleased that he's willing to allow his name to 0:11:43.160 --> 0:11:46.319 come forward. My guess is that the confirmation hearing is 0:11:46.320 --> 0:11:49.640 going to focus more about our challenges with Russia than 0:11:49.679 --> 0:11:54.120 the qualifications of Mr Huntsman. Uh. The the US Russia 0:11:54.200 --> 0:11:58.520 relationship is extremely important and it is very challenged today. 0:11:58.800 --> 0:12:00.640 I bring up bring up that a nation that's a 0:12:00.720 --> 0:12:03.960 high level one for a big ambassadorship, when when you 0:12:04.120 --> 0:12:06.920 look at the names the White House is putting forward, 0:12:07.720 --> 0:12:09.480 how worried are you about how few of them you've 0:12:09.520 --> 0:12:12.480 seen thus far? Are you getting any indication here that 0:12:12.520 --> 0:12:14.199 the White House is going to be moving faster to 0:12:14.240 --> 0:12:16.600 fill some of the vacant positions that still exist in 0:12:16.679 --> 0:12:21.240 Foggy Bottom. I am extremely concerned by the slow pace 0:12:21.320 --> 0:12:24.440 of filling critical positions at the State Department. I'm not alone. 0:12:24.559 --> 0:12:28.440 Democrats and Republicans have voiced our concern just talking about 0:12:28.480 --> 0:12:31.520 North Korea, we don't have an Assistant secretary for that region, 0:12:31.920 --> 0:12:34.720 so we don't have the people in place that can 0:12:34.720 --> 0:12:37.880 give a clear direction to U S policy in so 0:12:38.000 --> 0:12:40.280 many parts of the world. So it's not just our 0:12:40.320 --> 0:12:45.000 ambassadors in important countries, it's key positions within the State 0:12:45.040 --> 0:12:48.360 Department that are political appointments, such act confirmation about a 0:12:48.400 --> 0:12:51.079 Senate that hadn't been filled. It's Friday, so I'm allowed 0:12:51.120 --> 0:12:56.000 to do gossips. I'm absolutely fascinated by who's sitting on 0:12:56.040 --> 0:12:59.400 the couch in the Oval office. Do the Democrats have 0:12:59.520 --> 0:13:04.080 the back of Senator Schumer and Speaker Pelosi? Do they 0:13:04.120 --> 0:13:08.000 have the support of not common sense Democrats like Cardon 0:13:08.440 --> 0:13:11.520 of Maryland but the other rabble? Are they in support 0:13:11.559 --> 0:13:16.040 of the two? Oh? Absolutely. We very much want our 0:13:16.080 --> 0:13:18.240 political system to work, and the only way it's going 0:13:18.320 --> 0:13:21.959 to work is with Democrats and Republicans all being involved. 0:13:22.280 --> 0:13:25.599 So we applaud our leaders willingness to sit down with 0:13:25.679 --> 0:13:30.080 President Trump and to work out solutions that the doctor children. 0:13:30.160 --> 0:13:32.640 We need to protect the Dreamers, and it's one of 0:13:32.640 --> 0:13:35.960 it's one of our highest priorities among the Democratic caucus. 0:13:36.240 --> 0:13:38.280 We were pleased to see that we didn't have a 0:13:38.320 --> 0:13:41.400 default on our government debt. We would see a budgets 0:13:41.400 --> 0:13:45.240 passant's keep government open. So look, we were disappointed by 0:13:45.240 --> 0:13:47.280 the election, but we wanted to make sure that our 0:13:47.400 --> 0:13:49.920 system works and Democrats need to be part of the process. 0:13:50.000 --> 0:13:52.480 Senator I was medicated coming in this morning because I 0:13:52.520 --> 0:13:57.040 had to watch Orioles baseball last night. Come on, guys, 0:13:57.080 --> 0:13:59.360 doing like a public grant to help Mr Show Walter 0:13:59.440 --> 0:14:02.160 out any Kenny hit the ball. It's a Nutcome on, 0:14:02.280 --> 0:14:06.679 When does this turn around for the dreaded Baltimore Orioles. Well, 0:14:06.720 --> 0:14:08.839 you know that we've had ups and downs during the sea, 0:14:09.559 --> 0:14:11.880 some stretches that we we thought we were going to 0:14:11.920 --> 0:14:14.320 be the world champions, and we're not giving up hope 0:14:14.400 --> 0:14:17.040 yet We're still in We're still in a pennant chase, 0:14:17.160 --> 0:14:20.160 and but it's it's been a very disappointing two weeks, 0:14:20.160 --> 0:14:23.640 no question about it. And we love our Orioles. We 0:14:23.720 --> 0:14:25.920 just wish they were flying along higher. They play in 0:14:25.960 --> 0:14:30.440 the most gorgeous modern ballpark. Senator Card, Thank you so much, 0:14:30.800 --> 0:14:34.320 Senator for the Baltimore word. Great to speak with him again, 0:14:34.360 --> 0:14:37.520 the ranking member of the Senate Foreign Relations Committee. Incredibly 0:14:37.560 --> 0:14:39.560 timely interview. Grateful to have him taking the time on 0:14:39.560 --> 0:14:41.760 this busy Friday morning to talk to us about North 0:14:41.800 --> 0:14:44.400 Korean particularly David, did those states like I think in 0:14:44.480 --> 0:14:50.120 Georgia North South that span geography Maryland is remarkable over 0:14:50.200 --> 0:14:54.880 a short distance from the West on serious XM to Baltimore, 0:14:55.880 --> 0:15:11.680 M Baltimore, Washington. This is Bloomberg. We had one solitary 0:15:11.800 --> 0:15:16.360 guest this hour, and he brought an entourage with him. 0:15:16.400 --> 0:15:19.000 Why did you attempt an introduction, David, I'm gonna I'm 0:15:19.000 --> 0:15:20.720 gonna run down the list you get Mark last year 0:15:20.720 --> 0:15:23.000 with us, Jeff down in West, Eden's as well here 0:15:23.000 --> 0:15:25.440 in our Bloomberg eleven three oh studios in New York. 0:15:25.480 --> 0:15:27.400 And Uh, I don't know who to begin with you. 0:15:27.480 --> 0:15:29.880 Let's let's start with West if we could talk it, 0:15:29.960 --> 0:15:32.360 I'll let you follow up from here. Let me just 0:15:32.400 --> 0:15:34.120 get your your sense of sort of where things stand 0:15:34.120 --> 0:15:36.160 from an investment perspective right now, where there's the greatest 0:15:36.160 --> 0:15:39.440 opportunity as you see it, and and UH just too 0:15:39.520 --> 0:15:41.640 maybe outline if you could some of the challenges of 0:15:41.640 --> 0:15:44.960 of being invested right now. Well, good morning, thanks for 0:15:45.000 --> 0:15:47.240 having us. You know, the UH, I think the environment 0:15:47.280 --> 0:15:49.520 right now from an investment standpoint is pretty tough. You know, 0:15:49.560 --> 0:15:52.800 you've had a long period of very low interest rates 0:15:53.040 --> 0:15:55.120 and you've got pretty good good growth in the US 0:15:55.160 --> 0:15:58.320 and nowithstanding kind of lots of challenges, but there's not 0:15:58.360 --> 0:16:00.720 a lot that is obviously cheap, you know, So it's 0:16:00.760 --> 0:16:02.960 a it's a time to pay attention to what you're doing. 0:16:03.200 --> 0:16:05.160 This is a four hour interviews. If you have three 0:16:05.160 --> 0:16:07.960 guys in the studio, go, can I get into here? 0:16:08.040 --> 0:16:11.000 David Mark? Last year, I've been dying to talk to 0:16:11.040 --> 0:16:15.560 you about the follies of Washington. How did you enter America? 0:16:15.800 --> 0:16:18.120 Were you were like on? You didn't go through Ellis Island, 0:16:18.200 --> 0:16:22.760 right comes through? Jfk JFK. I mean, what do you think? 0:16:22.800 --> 0:16:25.800 I mean, you're Moroccan, you come into the country. You're 0:16:25.800 --> 0:16:29.600 the definition of success of immigrants. What do you think 0:16:29.640 --> 0:16:32.880 of what's going on in Washington with Dacca and with 0:16:33.120 --> 0:16:36.920 the debate over rich or poor immigration and the rest. Look, 0:16:36.920 --> 0:16:38.800 I think I mean for me, it's probably a little 0:16:38.840 --> 0:16:41.000 bit more sensitive. But I think at the end of 0:16:41.040 --> 0:16:44.360 the day, you know, this country was made on immigrants 0:16:44.840 --> 0:16:48.320 and what's going on today is a bit ridiculous over 0:16:48.400 --> 0:16:52.440 all this stuff, So you would hope that people would 0:16:52.480 --> 0:16:54.320 be able to solve this issue. On doc CO. You 0:16:54.360 --> 0:16:56.040 came out of one of the coolest schools on the 0:16:56.040 --> 0:16:59.520 East Coast, Clark University. Would you have to go back home? Now? 0:16:59.640 --> 0:17:01.360 I mean you, I mean, I guess you were in 0:17:01.400 --> 0:17:04.320 the US then, But think of the immigrants that are 0:17:04.320 --> 0:17:07.680 going through top flight engineering schools and am I right? 0:17:07.840 --> 0:17:10.360 They gotta go home? Now? Well they do. I mean, 0:17:10.760 --> 0:17:12.919 good news is I got naturalized, So I guess for 0:17:12.960 --> 0:17:16.160 me it's okay. But ultimately, at the end of the day, 0:17:16.680 --> 0:17:18.679 for all these people who are at school, they'd have 0:17:18.720 --> 0:17:21.080 to return, should be done. Let me let me turn 0:17:21.160 --> 0:17:27.359 to you have a wide ranging conversation. You're obviously there. Yeah, 0:17:27.400 --> 0:17:29.119 well let's let's go there if we could. And and 0:17:29.119 --> 0:17:31.640 and this is something of particular fascination we we've we've 0:17:31.680 --> 0:17:34.280 seen the sale here the Houston Rockets recently for for 0:17:34.320 --> 0:17:37.399 an extraordinary sum of money. Help us understand how you 0:17:37.440 --> 0:17:40.400 value a basketball team. You hear the three of you investors, 0:17:40.560 --> 0:17:43.760 owners of a big NBA franchise, What does it? What 0:17:43.760 --> 0:17:45.760 does a sale like that mean for how you you 0:17:45.760 --> 0:17:52.440 you assign a value to to an NBA franchise. Jamie, Sorry, 0:17:54.880 --> 0:18:00.320 I think we're blood as well. Yeah, we can't get flooded. Um, No, 0:18:00.520 --> 0:18:04.080 you know it's you know what's at the at the 0:18:04.160 --> 0:18:06.560 end of the day, which really happening is really a 0:18:06.600 --> 0:18:11.200 few things. One is the modern NBA game is probably 0:18:12.080 --> 0:18:14.840 as exciting, if not the most exciting. I think sports 0:18:14.960 --> 0:18:18.280 thing to watch and as a result, viewers are watching it, 0:18:18.680 --> 0:18:21.600 kids are watching, millennials are watching it, the world is 0:18:21.640 --> 0:18:24.600 watching it. I think it's probably you know, the most 0:18:24.640 --> 0:18:27.679 popular you know, big type you know sport I can 0:18:27.840 --> 0:18:31.359 China for example, and after soccer, it's the number two 0:18:31.359 --> 0:18:34.359 sports in the world. That's that's really number one. And 0:18:34.400 --> 0:18:38.480 as you look at what's happening with money for sports, okay, 0:18:38.520 --> 0:18:42.879 money for entertainment, it's really live sports that basically is 0:18:42.920 --> 0:18:45.560 the one thing you cannot watch the next day, don't 0:18:45.560 --> 0:18:47.719 want to watch the next day, you don't you know, 0:18:48.080 --> 0:18:51.920 want to basically deal with the so called court coloring risk. 0:18:52.000 --> 0:18:53.920 You have to watch it, you know, live, So it's 0:18:53.920 --> 0:18:57.960 real value that. And then lastly, quite frankly, is I 0:18:57.960 --> 0:19:01.400 think there's a live people who love the you know teams. 0:19:01.440 --> 0:19:04.240 You know. I would say, of all my investments I've 0:19:04.280 --> 0:19:06.240 ever done, and I think Mark and West would agree, 0:19:06.480 --> 0:19:09.719 this is by far the most fun investment. You had 0:19:09.720 --> 0:19:11.639 more fun at d l J a few years ago, right, 0:19:11.800 --> 0:19:15.320 it was a long time ago, A long time Mark 0:19:15.440 --> 0:19:17.480 last three and Jamie dining with us. You know, we're 0:19:17.480 --> 0:19:19.720 gonna mix it up. We could literally, folks, we could 0:19:19.720 --> 0:19:22.280 go worldwide here for four hours. And these three guys, 0:19:22.280 --> 0:19:26.840 they've got such great experience, an individual and distinct experience. Jamie, 0:19:26.920 --> 0:19:28.119 let me start with you. You were in the d 0:19:28.240 --> 0:19:30.960 LJ Orange book years ago, right, Elliott Platt would write 0:19:30.960 --> 0:19:33.920 the Maroon book for DLJM Fixed Income and you had 0:19:33.960 --> 0:19:36.760 the whole thing going. Can you tell a kid today 0:19:36.800 --> 0:19:39.879 to go into global Wall Street given a method two, 0:19:40.119 --> 0:19:42.840 giving the battle over research? Can you tell some kid 0:19:42.920 --> 0:19:45.520 coming out of Pennsylvania like you did? Can you tell 0:19:45.560 --> 0:19:50.440 him to go into finance be like Mark last? Three? Absolutely, 0:19:50.560 --> 0:19:54.080 if it is your passion. Okay. I remember when I 0:19:54.080 --> 0:19:57.120 went into Wall Street and it was one My first 0:19:57.160 --> 0:19:59.679 job paid me twenty two thousand dollars a year. It 0:19:59.760 --> 0:20:01.879 was a decent salary, but it wasn't like you know 0:20:01.920 --> 0:20:04.639 the kind of numbers you're hearing about today. And I 0:20:04.720 --> 0:20:07.199 went because I was passionate about I actually wanted to 0:20:07.240 --> 0:20:09.760 do it. If this is the career that you're passionate about, 0:20:09.800 --> 0:20:11.600 you really want to do, you should do it. I 0:20:11.600 --> 0:20:14.440 think it's still a good career. Okay. If if you're 0:20:14.440 --> 0:20:16.960 going to get rich, I wouldn't do that. If you're 0:20:16.960 --> 0:20:18.719 going to because you want to make something that you're 0:20:18.720 --> 0:20:22.560 actually gonna enjoy doing and actually do well. Got absolutely, 0:20:23.200 --> 0:20:25.400 Let's see this. Let me ask you about infrastructure in particularly. 0:20:25.440 --> 0:20:27.480 We came out of the election headed into inauguration with 0:20:27.520 --> 0:20:29.639 a lot of talk about there being a big infrastructure 0:20:29.640 --> 0:20:32.640 spending package, there being a renewed policy focus on infrastructure 0:20:33.119 --> 0:20:35.280 in this country. You know this is something you're keenly 0:20:35.320 --> 0:20:38.680 interested in as an investor. Are you convinced we're gonna 0:20:38.680 --> 0:20:41.640 see something? How essential is it in your estimation that 0:20:41.760 --> 0:20:45.040 we get Washington to play some sort of catalytic role 0:20:45.080 --> 0:20:47.600 here to to to provide some sort of package that's 0:20:47.600 --> 0:20:50.720 gonna renew focus on infrastructure in this country. I think 0:20:50.720 --> 0:20:53.000 it's critical, you know, I think that the returns on 0:20:53.080 --> 0:20:56.199 infrastructure are you know, multiplier effects. I think, who do 0:20:56.200 --> 0:20:58.760 you have great infrastructure and actually is the kind of 0:20:58.760 --> 0:21:01.000 bedrock of a lot of economics activity. So it's really 0:21:01.040 --> 0:21:03.119 important and there's lots and lots of need for in 0:21:03.119 --> 0:21:05.960 the country. Um. I think there will be something on Washington, 0:21:05.960 --> 0:21:07.360 hopefully by the end of the year or the first 0:21:07.359 --> 0:21:09.919 part of next year. And uh, I don't know what 0:21:09.960 --> 0:21:12.160 they're gonna what they're gonna say and how effective it's 0:21:12.160 --> 0:21:13.879 going to be, But I think it's desperately needed. What 0:21:14.000 --> 0:21:16.440 what's the I mean, what what could be most effective? 0:21:16.800 --> 0:21:18.800 You know, I've listened to the presidency talked about this 0:21:18.840 --> 0:21:20.440 and you see it sort of Eban flow what he 0:21:20.480 --> 0:21:22.800 focuses on. And he's talked about infrastructure sum he was 0:21:22.800 --> 0:21:24.960 out in Io talking about it and the merits of 0:21:25.040 --> 0:21:28.720 more public private partnerships. Is there a policy tool or 0:21:28.800 --> 0:21:31.080 something in particular that you think would be more effective 0:21:31.080 --> 0:21:35.000 than others at at boosting investment infrastructure. Yeah, I think 0:21:35.040 --> 0:21:36.960 I think it's very very clear. I think that the 0:21:37.119 --> 0:21:41.280 essential thing to to provide is uh a mechanism for 0:21:41.440 --> 0:21:44.160 private capital to fund a lot of it and so 0:21:44.520 --> 0:21:47.000 and and really the missing link in the capital structure 0:21:47.000 --> 0:21:48.640 for a lot of this is debt. So I think 0:21:48.640 --> 0:21:50.520 the government can be a debt provider and not cost 0:21:50.520 --> 0:21:52.159 the government a lot of money. And I think they 0:21:52.160 --> 0:21:54.720 can then enable a lot of product and direct investment. 0:21:54.720 --> 0:21:56.760 And I think that you could really see a tremendous moment. 0:21:56.960 --> 0:21:59.080 And so it's true, and jump in here if you 0:21:59.400 --> 0:22:01.639 we just got it's a phone with Hugh Henry of 0:22:01.720 --> 0:22:05.280 Scotland over in England. He's shutting down his hedge fun today. 0:22:05.320 --> 0:22:08.480 And I made a key distinction here. He didn't blow up. 0:22:08.600 --> 0:22:10.439 A lot of people blow up. We all blow up. 0:22:10.440 --> 0:22:12.919