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Speaker 1: Bloomberg Audio Studios, podcasts, radio News.

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Speaker 2: This week on the podcast Another Banger.

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Speaker 1: Lori Heinel is executive vice president and Global Chief Investment

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Speaker 1: Officer at State Street Investment Management. She oversees five point

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Speaker 1: seven trillion dollars in assets and that's as of the

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Speaker 1: end of.

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Speaker 2: Twenty twenty five.

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Speaker 1: It's obviously market has appreciated since then. She oversees index funds, ETFs,

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Speaker 1: active strategies, alternatives, multi asset solutions, and really drives an

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Speaker 1: incredible organization. I thought this conversation was fascinating and I

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Speaker 1: think you will also with no further ado, my interview

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Speaker 1: with State Streets Lori Heinel. Lori Heinel, Welcome Bloomberg.

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Speaker 3: Thanks for having me.

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Speaker 1: So let's start out with your early career and your

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Speaker 1: academic background. You study religion at Princeton before getting your

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Speaker 1: MBA at Carnegie Mellon. What was the career plan with

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Speaker 1: religious studies.

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Speaker 4: Well, that's a long story, but I'll try to keep

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Speaker 4: it short. Bottom line is I went to Princeton because

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Speaker 4: I wanted to get more of a liberal arts education.

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Speaker 4: And what I realized pretty quickly is it didn't really

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Speaker 4: matter what I majored in. I could major in economics,

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Speaker 4: I could major in history, and I happened to take

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Speaker 4: a religious studies course, which I just absolutely adored. And

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Speaker 4: from a personal standpoint, I had a number of people

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Speaker 4: in my family who were incredibly staunch practicing Catholics or

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Speaker 4: other kinds of Christian religions, and they would do things

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Speaker 4: that to me were quite odd at times, and so

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Speaker 4: I thought.

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Speaker 3: From a personal perspective.

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Speaker 4: It would be an interesting way to get more insight

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Speaker 4: into what was going on with some of these family members.

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Speaker 4: So short answer is that I decided to pursue that

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Speaker 4: as an academic undertaking. And then I got to a

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Speaker 4: place where I needed to think about a career and

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Speaker 4: my first thought was, well, geez, maybe I'll go to

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Speaker 4: law school. Well, then I realized I needed to make

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Speaker 4: some money. So my second thought was, well, geez, you

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Speaker 4: know there's this analyst program thing that they have on

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Speaker 4: Wall Street. Surely you know they recruited fine institutions like

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Speaker 4: Princeton and Lo and Behold. That catapulted me into what

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Speaker 4: became a really long career in finance by just moving

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Speaker 4: from an institution like Princeton into an analyst program.

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Speaker 2: So let's move forward.

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Speaker 1: You started credit Swiss First Boston, where you ran equity.

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Speaker 2: And fixed income sales.

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Speaker 1: Then you ended up working on with trading at Parker

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Speaker 1: Hunter in Pittsburgh.

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Speaker 2: Am I getting.

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Speaker 4: These Well, I didn't start by running anything, So I

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Speaker 4: started out as a two year grunt right. I think

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Speaker 4: most of your listeners know what these analyst programs look like.

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Speaker 4: I was effectively in investment banking for public finance, worked

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Speaker 4: with hospitals, airports, municipal authorities. But I did all the

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Speaker 4: kind of grunt work, if you will, all the numbers

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Speaker 4: crunching behind the scenes and helping to run the deal

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Speaker 4: models and things of that nature.

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Speaker 3: And I just found that fascinating.

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Speaker 4: I thought it was really amazing to connect both you

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Speaker 4: know what's going on in the world with you know

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Speaker 4: how finance supports that. And so I did that for

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Speaker 4: a couple of years. And then at the end of

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Speaker 4: the two year program, you're typically expected to go back

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Speaker 4: to business school.

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Speaker 3: Well, I still.

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Speaker 4: Needed to make money because I had student loans to

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Speaker 4: pay off. So I decided I wanted to stay and

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Speaker 4: that me led me to an opportunity on the trading

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Speaker 4: desk at First Boston, which really was an incredible opportunity

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Speaker 4: because that was my first real introduction to markets.

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Speaker 2: So what did working on the trading floor teach you

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Speaker 2: about markets?

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Speaker 3: So many things.

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Speaker 4: I think the first and most important thing is I

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Speaker 4: was there during the eighty seven Black Monday crash, and

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Speaker 4: I happened to be working in fixed income. So it

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Speaker 4: was a really interesting day because, of course that time,

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Speaker 4: the first Boston trading floor was on two different levels,

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Speaker 4: so you had all the fixed income was on one level,

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Speaker 4: all the equities was on a different level. And we

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Speaker 4: went dead silent in the first part of the day,

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Speaker 4: and suddenly people were starting to realize what was happening

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Speaker 4: in the market, crashing you know, twenty plus percent over

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Speaker 4: the course of you know, a day, which of course

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Speaker 4: today we've got calibrators that don't let that happen anymore.

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Speaker 4: But then all of a sudden, towards the end of

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Speaker 4: the day, things on the fixed income markets started going

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Speaker 4: crazy because now you had the FED coming out alan

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Speaker 4: Greenspan saying, you know, we're going to go ahead and

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Speaker 4: provide liquidity. We're going to make sure that there's you know,

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Speaker 4: active engagement to forestall any further you know, recessions or

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Speaker 4: other things that might be caused by this kind of

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Speaker 4: major crash. So I guess the first lesson I learned

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Speaker 4: was that there are winners and there are losers in

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Speaker 4: every market event, and it's better.

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Speaker 3: To be on the winning side.

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Speaker 4: So I happened to be at that time on the

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Speaker 4: bond side, which was the big winner that day. But

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Speaker 4: then I think the other thing that I learned was

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Speaker 4: that you have to be really careful about things like

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Speaker 4: moral hazard, because we became accustomed in that moment to

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Speaker 4: this idea of the fed put and I think many

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Speaker 4: years later, we are still wondering about what that really

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Speaker 4: does mean in terms of the reaction function.

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Speaker 1: So take me back to nineteen eighty seven for a second.

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Speaker 1: I was in grad school at the time, but I

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Speaker 1: can only imagine the fixed income trading floor. Were people

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Speaker 1: sitting around their feet on their desk, sipping lattes like

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Speaker 1: or did anyone say let's go down to the equity

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Speaker 1: floor and look at the chaos and carnate.

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Speaker 4: Well, the first thing we were doing, we were sitting

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Speaker 4: there doing the Crossford puzzles. There were lots of days,

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Speaker 4: and I was in unibond trading, so it was a

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Speaker 4: little bit of trade by appointment, very sleepy very sleepy

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Speaker 4: at times. Obviously, fixing come markets got a lot more

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Speaker 4: interesting throughout my career, but at that time it was

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Speaker 4: not uncommon. In the early morning we do a few

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Speaker 4: trades and then we'd have a little break, we'd go

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Speaker 4: get some lunch, we'd do a little crossboard puzzle.

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Speaker 3: So that day was different, right, So we had.

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Speaker 4: Our normal morning, but by the time you got to

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Speaker 4: the early afternoon, it's like, wow, something's really happening here,

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Speaker 4: and you started to see major moves in bond markets,

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Speaker 4: including in the MENI market, and so suddenly it was

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Speaker 4: a very different, more chaotic even on our floor.

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Speaker 1: So money was flying out of equities, did it roll

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Speaker 1: right into just safe harbor and body.

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Speaker 4: Well, cash was the big place, right, So we had

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Speaker 4: these variable rate demand notes offerings which were seven day

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Speaker 4: resets and so they acted like a form of cash.

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Speaker 4: So we saw massive demand almost immediately in that particular

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Speaker 4: market because it was a cash substitute. But with the

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Speaker 4: tax advantages, when.

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Speaker 2: Was the yield in eighty seven, Well.

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Speaker 4: On those it would have been in the sevens, probably

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Speaker 4: because you look at the spread and on a tax free.

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Speaker 1: Oh man, that's twelve exactly, exactly amazing Yeah, So before

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Speaker 1: after Credit Swiss, but before State Street, you had a

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Speaker 1: couple of really interesting positions. You were head of investments

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Speaker 1: at City Private Bank, You ran global investment products for Sei,

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Speaker 1: You led new business development at Melon Financial, and you

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Speaker 1: were chief investment strategist in Oppenheim Are Funds.

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Speaker 2: What's the throughput?

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Speaker 1: What's the common thread in all of those?

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Speaker 4: Well, some of those were personal. So at the time

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Speaker 4: that I was in New York, I met my then

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Speaker 4: to become a husband, where since divorced, but at the

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Speaker 4: time we were engaged and we ended up moving to Pittsburgh.

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Speaker 4: He got a job there and so I followed him there.

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Speaker 4: So the Parker hunter was really you know, personal reasons,

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Speaker 4: needed to find something to do totally different city. I

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Speaker 4: had grown up in Pittsburgh, so in some ways it

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Speaker 4: was a real blessing because that's where we ended up

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Speaker 4: having our two children, and so it was great to

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Speaker 4: have that support network at a time where I wanted

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Speaker 4: to continue to work through my early child childbearing years,

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Speaker 4: if you will. And then I think after that we

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Speaker 4: consolidated on the East Coast because we both realized and

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Speaker 4: he was in finance as well. He stated in Investment

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Speaker 4: banking that we wanted to have more opportunities in Pittsburgh's

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Speaker 4: a great city for many many reasons, but it's not

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Speaker 4: a place where you have a lot of opportunities in finance.

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Speaker 3: So we ended up settling then in Philadelphia.

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Speaker 4: So once again I was on the prow for a role,

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Speaker 4: and that led me to first Mail in Financial, where

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Speaker 4: I did business development and started from scratch, built a

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Speaker 4: book over a couple of years, and then got very

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Speaker 4: fortunate recruited by a head hunter to go to Sei Investments,

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Speaker 4: and I would say that that was where I really

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Speaker 4: got the bug in asset management. So Sei has two

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Speaker 4: primary business lines. At least at the time, they were

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Speaker 4: a back office outsourcing firm, and then they also had

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Speaker 4: a pretty meaningful investment management arm, which was an outgrowth

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Speaker 4: of their early consulting days. And so I was hired

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Speaker 4: to basically build the asset management franchise for their community

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Speaker 4: and regional banking division. And so I would travel around

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Speaker 4: the you know, meeting with trust officers and financial advisors

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Speaker 4: and other kinds of practitioners at these small regional and

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Speaker 4: community banks and encouraging them to transition their business from

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Speaker 4: you know, do it themselves buying individual stocks and.

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Speaker 3: Bonds into a platform like SEI.

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Speaker 4: So for me that was a really eye opening experience.

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Speaker 4: One it just really opened up my eyes to all

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Speaker 4: of America. I traveled literally around the around the country,

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Speaker 4: but also just looking at the different needs that these

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Speaker 4: types of clients had and how we could serve them.

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Speaker 1: So you starting with the client's objectives and perhaps there

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Speaker 1: are future liabilities, you have to determine what's the most

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Speaker 1: efficient combination of vehicles, risk exposure, what's that process like

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Speaker 1: and is that sort of the through line of all

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Speaker 1: these different positions.

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Speaker 4: So the major through line of all the positions is

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Speaker 4: that focusing on the client first. So maybe if I

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Speaker 4: can regress just a half a beat. One of my

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Speaker 4: most formative experiences was when I was an investment banker

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Speaker 4: at First Boston. We were working on a deal for

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Speaker 4: the Arlington Airport Authority and at the time they were

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Speaker 4: doing what was called a pre refunding where they were basically,

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Speaker 4: you know, issuing new debt to pay for old debt

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Speaker 4: and tried to reduce their debt servicing costs over time.

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Speaker 4: So pretty common activity, and at the time, we kept

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Speaker 4: running all these numbers and we kept showing the director

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Speaker 4: these amazing discounted net present value savings that she was

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Speaker 4: getting from the deal, and every time she would leave

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Speaker 4: the room and say, this is not what I expected,

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Speaker 4: This is not what I wanted, this is not the

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Speaker 4: deal that I need to have happen.

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Speaker 3: And you know, I'm the most junior person running the numbers.

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Speaker 4: We've got the vps, the mds and everybody else around

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Speaker 4: the room, and they're all men. Turns out and they're like,

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Speaker 4: she's crazy. You know what's wrong with this woman. We're

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Speaker 4: delivering amazing net present value savings. So I happened to

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Speaker 4: run into her in the ladies room and said, you know,

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Speaker 4: it really helped me if I understood better why this

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Speaker 4: isn't working for you. And it turned out that statutorially

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Speaker 4: that they could only keep the savings in the first

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Speaker 4: year for the authority, and then every subsequent years of

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Speaker 4: savings would basically reduce the tax leans against all the

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Speaker 4: or or the fees that they were collecting at the airport,

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Speaker 4: so they didn't actually get savings from anything after.

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Speaker 3: The first year.

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Speaker 4: I was like, okay, got that, we're going to frolload

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Speaker 4: it off we go, right, So that told me a

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Speaker 4: lot of lessons around one, Listen to the client.

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Speaker 3: Don't just think.

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Speaker 4: Because you're the expert, you know all the answers. They

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Speaker 4: might need something different that you haven't thought of. And

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Speaker 4: it also taught me that it doesn't have to be

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Speaker 4: the most experienced person in the room that's going to

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Speaker 4: have that insight, because it took me five minutes to

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Speaker 4: figure out what we'd spent meeting after meeting trying to

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Speaker 4: gel through. Nobody asked that question right because they just

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Speaker 4: thought they knew better because every other client wanted max

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Speaker 4: net present value savings period full stop. One of the

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Speaker 4: I think the big threads that went throughout my entire

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Speaker 4: career that sort of you got to really listen. Sometimes

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Speaker 4: the problem is not what you thought the problem was.

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Speaker 4: And sometimes the answer, even though it's not optimal, it's

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Speaker 4: the best answer.

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Speaker 1: So how did you find your way to global CIO

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Speaker 1: at State Street?

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Speaker 4: Yeah, Well, the good news is I once again sort

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Speaker 4: of another theme in my career once I sort of

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Speaker 4: got to more of a senior level was I mostly

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Speaker 4: got recruited because I would have, you know, exposure, and

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Speaker 4: I'd get sort of known in the industry, and so

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Speaker 4: I got a call out of the blue from a headhunter,

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Speaker 4: and at the time I was very happy I was

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Speaker 4: living in New York City. I was actually had gotten

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Speaker 4: divorced by that point in time, was living in Jersey

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Speaker 4: City and working in Lower Manhattan. So I had a fabulous,

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Speaker 4: you know, six minute commute across the Ferry.

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Speaker 3: Which I relished.

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Speaker 4: But I felt like maybe I didn't have the next

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Speaker 4: step available to me at Oppenheimer Funds, which.

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Speaker 3: Of course is now part of Invesco.

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Speaker 4: And so I got a call and they were looking

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Speaker 4: for someone who would run their investment professionals more from

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Speaker 4: the sales and commercial side. The people that they called

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Speaker 4: like portfolio strategists, so some people know these people as

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Speaker 4: client portfolio managers. But they also wanted somebody who could

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Speaker 4: be groomed for other opportunities within the investment organization. And

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Speaker 4: you know, one thing led to another. I did a

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Speaker 4: little flyer to Boston, had a couple of conversations, and

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Speaker 4: what I really liked about, you know, what State Street

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Speaker 4: had to offer at that point in time was it

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Speaker 4: was a very broad platform. They covered all asset classes.

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Speaker 4: State Street, as you know, had a prime position in

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Speaker 4: ETFs and indexing, which you know, this would have been

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Speaker 4: you know, twenty fourteen, and while certainly those instruments were

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Speaker 4: very widely available and adopted by investors, nothing like that

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Speaker 4: ramp up in terms of growth that we've seen over

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Speaker 4: the last decade plus. And so what I saw was

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Speaker 4: a place where I could have the ultimate toolkit working

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Speaker 4: with the ultimate global client base to solve problems for

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Speaker 4: those clients using my expertise.

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Speaker 1: And just as a point, State Street has the Spiders,

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Speaker 1: the Spy which is the biggest institutional ETF for the

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Speaker 1: S and P five hundred, and the Gold Spiders GLD

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Speaker 1: which obviously gold is way off its highs, but that's

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Speaker 1: another giant ETF. What is it like overseeing what really

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Speaker 1: has become the standard bearers for both index funds and ETFs.

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Speaker 4: Yeah, well, look, there's a lot of complexity as you

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Speaker 4: well know to running ETFs, but one of the benefits

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Speaker 4: is that it's one large pool of capital, so you

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Speaker 4: can run it as a single proposition if you will,

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Speaker 4: you have one account. So there's definitely complexity there, but

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Speaker 4: in some ways that's more straightforward than the separate accounts

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Speaker 4: book of business that we manage for institutional clients.

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Speaker 3: Literally every.

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Speaker 4: SMP exposure Russell exposure BARAG exposure is going to be

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Speaker 4: customized to that particular client. So what's really interesting about

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Speaker 4: our platform is that we have both these you know,

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Speaker 4: large scale funds if you will, ETFs, but we also

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Speaker 4: have this massive separate account separate account management business which

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Speaker 4: we can deliver to institut institutional clients at a very

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Speaker 4: price competitive and very customized way.

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Speaker 2: Really interesting.

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Speaker 1: Coming up, we continue our conversation with Lori Heinel, executive

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Speaker 1: vice president at State Street, discussing a day in the

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Speaker 1: life of a global CIO helping to oversee five point

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Speaker 1: seven trillion dollars in client assets.

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Speaker 2: I'm Barry Results. You're listening to Masters in Business on

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Speaker 2: Bloomberg Radio.

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Speaker 1: I'm Barry Redults. You're listening to Masters in Business on

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Speaker 1: Bloomberg Radio. My extra special guest today is Lori Heinel.

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Speaker 1: She is executive vice president and global Chief Investment Officer

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Speaker 1: at State Street, where she helps to oversee five point

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Speaker 1: seven trillion dollars in assets. So let's talk a little

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Speaker 1: bit about State Street. I recall way back when they

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Speaker 1: launched Spy I want to say that was thirty years

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Speaker 1: a something like that, the first US ETF, and they've

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Speaker 1: been a pioneer of indexing and ETFs. You know, ever since,

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Speaker 1: how do you look at the role of indexing in portfolios?

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Speaker 1: How has this changed not only over your tenure at

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Speaker 1: State Street, but over your entire career.

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Speaker 4: Yeah, well, I think the first thing I would say

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Speaker 4: is that once upon a time, it wasn't really possible

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Speaker 4: for people to get index replication, right. So that was

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Speaker 4: the great innovation of something like spy, where suddenly every

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Speaker 4: individual investor could buy one security and effectively get the market.

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Speaker 4: And for much of my career, particularly in the early

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Speaker 4: part of my career, it was all about beating the market.

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Speaker 4: Let's get the best active managers who could beat that index.

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Speaker 4: And what you find in for decades now is in

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Speaker 4: many markets, especially large cap us, it's.

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Speaker 3: Really challenging to do that net of fees.

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Speaker 4: And so I've thought for many decades now that this

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Speaker 4: combination of index exposure where it was really hard to

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Speaker 4: find managers who could consistently outperformed, coupled with maybe some

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Speaker 4: satellite managers or specialist managers or managers and other parts

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Speaker 4: of the market, think emerging markets, small cap adding your

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Speaker 4: risk budget and your active management budget there just made

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Speaker 4: a lot of sense So when I think about portfolio construction,

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Speaker 4: it really is I want to accomplish some sort of outcome,

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Speaker 4: some sort of risk based outcome for that client, but

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Speaker 4: I also want to do it in a way that

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Speaker 4: covers fees, provides opportunities for alpha or outperformance, but does

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Speaker 4: so in a kind of measured way.

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Speaker 1: So stage treats or record inflows in twenty twenty five

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Speaker 1: into I think this is the ETF and index business.

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Speaker 1: One hundred and eighty billion net inflows, management fees up

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Speaker 1: thirteen percent, and engross growth.

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Speaker 2: Where do you see the growth.

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Speaker 1: Coming from in the space I keep hearing indexing is over.

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Speaker 1: ETFs have had their day, and yet year after year

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Speaker 1: it seems to be the big winner.

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Speaker 4: Well, I think there's still lots of room for indexing

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Speaker 4: to run, because if you think about places like fixed income,

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Speaker 4: we've only started to scratch the surface relative to what

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Speaker 4: you see on the equity side of things. So increasingly

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Speaker 4: or even seeing quote unquote exotic fixed income things like

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Speaker 4: emerging debt, things like high yield, which we've had index

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Speaker 4: products for quite a long time, become much more adopted

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Speaker 4: by clients globally because they see that as a great

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Speaker 4: way to get access again to a market in a

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Speaker 4: way that they can really understand the risk and manage

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Speaker 4: it within the portfolio context. So I think there's still

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Speaker 4: plenty of room for indexing to run. I think the

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Speaker 4: other thing is we've seen a major shift in terms

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Speaker 4: of the client segmentation, if you will. So once upon time,

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Speaker 4: the big investors were the large institutional investors, you know,

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Speaker 4: the defined benefit plans, sovereign wealth funds. Those investors are

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Speaker 4: still important, but increasingly the net incremental dollar is coming

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Speaker 4: from the retail client, whether it's through defined contribution or

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Speaker 4: rollovers or you know, other kinds of assets that they

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Speaker 4: might have, And that's happening globally, and those investors are

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Speaker 4: really early to the ETF if you will, journey and

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Speaker 4: have lots of opportunity there. And then most recently you'll

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Speaker 4: have seen that we were selected for the Trump accounts

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Speaker 4: as the default investment. So that's another vector of investor

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Speaker 4: that we think comes online into the indexing platforms.

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Speaker 1: Really really interesting. I want to I want you to

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Speaker 1: push back on my understanding of indexing in equity and

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Speaker 1: indexing in fixed income. So here's what I have been

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Speaker 1: led to believe over many, many years of acad study

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Speaker 1: and research and lots and lots of great academic analysis.

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Speaker 1: It's really really hard to beat the market through active

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Speaker 1: management of equities. It's relatively easy to beat the market

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Speaker 1: through reducing risk, changing duration, reduced improving credit quality through

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Speaker 1: active management of fixed income. How accurate or inaccurate are

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Speaker 1: those statements.

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Speaker 4: So this is a classic of it depends on how

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Speaker 4: you think about the problem, right, So first, it is

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Speaker 4: absolutely empirically true that in many spaces and equities, the

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Speaker 4: average manager just does not outperform. We have all those

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Speaker 4: studies from all the various you know, research that that

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Speaker 4: substantiate's at in fixed income. To your point, there is

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Speaker 4: more evidence that active managers can add value. But what's

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Speaker 4: been interesting over the last decade or so is this

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Speaker 4: rise of better understanding of factor based investing at a

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Speaker 4: lot of fixed income factors. As I mean, factor investing

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Speaker 4: has been around for a long time decades, but within

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Speaker 4: fixed income in particular, I think we've gotten more and

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Speaker 4: more sophisticated models that help us to disaggregate where those

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Speaker 4: returns are coming from. And what we found is that

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Speaker 4: a lot of those active alphas, if you will, out

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Speaker 4: of fixed income managers are really one of two things.

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Speaker 4: They go down in credit quality or the extenduration, and

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Speaker 4: when you actually neutralize for those two things, suddenly the

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Speaker 4: active fixed income managers don't look quite as heroic as

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Speaker 4: they did before you adjust for those things. So one

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Speaker 4: of the big trends that we're really leaning into in

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Speaker 4: fixed income is that applying that factor based lens to

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Speaker 4: fixed income to be able to more stylize the portfolio,

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Speaker 4: but do so at a very competitive feed level and

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Speaker 4: deliver alpha, but alpha through indexing plus some factor exposures

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Speaker 4: versus kind of just classic fundamental bottoms up kind of

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Speaker 4: secure selection.

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Speaker 2: Really interesting.

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Speaker 1: So what's kind of fascinating about your role is much

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Speaker 1: of the capital you oversee is deliberately designed to not

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Speaker 1: take an active view.

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Speaker 2: What does it mean to be a CIO at a

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Speaker 2: firm like that? Where do your views show up?

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Speaker 3: Yeah?

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Speaker 4: Well, the first thing I need to just make sure

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Speaker 4: everybody understands is that we.

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Speaker 3: Do have active capabilities as well.

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Speaker 4: They're certainly not the massive amount of the assets that

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Speaker 4: we oversee, but if you look at our fixed income,

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Speaker 4: equity and multi asset class strategies that are active in

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Speaker 4: some way, that's a couple hundred billion dollars, so it's

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Speaker 4: not tiny. It would still make us a pretty significant

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Speaker 4: player in this market even if that's all we did.

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Speaker 4: So we do believe that there are opportunities for active

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Speaker 4: managers to outperform. It's just one of those things where

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Speaker 4: you need to understand, you know, how much to allocate

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Speaker 4: to those active managers, make sure you're picking the very best,

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Speaker 4: because obviously there are some that cannot perform. But I

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Speaker 4: think from a view perspective, it's actually very valuable having

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Speaker 4: all the different perspectives at the table. We have a

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Speaker 4: chief economists and chief geopolitical analyst. They really help us

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Speaker 4: with what are the expected growth rates around different economies

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Speaker 4: in the world, what are inflation expectations going to look like,

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Speaker 4: what's the sort of backdrop against which we're against which

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Speaker 4: we're trying to invest, so that we have some sense

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Speaker 4: of our rates likely to move up or down? You know,

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Speaker 4: our is growth likely to be supportive for earnings? Some

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Speaker 4: of those sort of macro factor setting types of things.

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Speaker 4: And then I think within our active teams, and we

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Speaker 4: have a multi asset class team in particular, they're deploying capital.

443
00:23:38,720 --> 00:23:44,440
Speaker 4: They're deploying capital indequities, fixed income, sub sectors, commodities, gold, cash,

444
00:23:44,480 --> 00:23:47,399
Speaker 4: and so they have a view on which of those

445
00:23:47,800 --> 00:23:49,800
Speaker 4: areas are going to do best. And obviously we have

446
00:23:49,880 --> 00:23:53,679
Speaker 4: lots of discussion amongst ourselves about whether, you know, I

447
00:23:53,840 --> 00:23:56,399
Speaker 4: personally agree with those views or don't agree with those views,

448
00:23:56,640 --> 00:23:59,159
Speaker 4: But ultimately it really is a committee that gets together

449
00:23:59,560 --> 00:24:03,199
Speaker 4: and makes those macro calls. And then within our individual

450
00:24:03,240 --> 00:24:08,240
Speaker 4: active capabilities we've got fundamental and quantitative equity and fixed income.

451
00:24:08,600 --> 00:24:13,200
Speaker 4: Those portfolio managers are basically charged with doing the hard

452
00:24:13,240 --> 00:24:16,560
Speaker 4: work to figure out how they are going to generate alpha,

453
00:24:16,600 --> 00:24:19,240
Speaker 4: and we've been quite successful. About sixty five percent of

454
00:24:19,280 --> 00:24:21,960
Speaker 4: our strategies are out performing on a trailing one three

455
00:24:22,000 --> 00:24:24,080
Speaker 4: year basis really interesting.

456
00:24:24,119 --> 00:24:29,920
Speaker 1: You mentioned a variety of different colleagues and portfolio managers

457
00:24:29,920 --> 00:24:33,560
Speaker 1: and economists and strategists, but really it's just the tip

458
00:24:33,560 --> 00:24:36,040
Speaker 1: of the iceberg. You lead a team of over six

459
00:24:36,160 --> 00:24:41,000
Speaker 1: hundred investment professionals and they're located around the world. How

460
00:24:41,000 --> 00:24:47,120
Speaker 1: do you keep an investment organization that large and that dispersed,

461
00:24:48,320 --> 00:24:51,760
Speaker 1: all on the same page, all coherent, all moving together.

462
00:24:51,920 --> 00:24:55,359
Speaker 4: Well, I have a lot of help, So I think

463
00:24:55,880 --> 00:24:59,240
Speaker 4: any manager will appreciate that the most important job. You

464
00:24:59,280 --> 00:25:01,400
Speaker 4: do it once you're in a leadership position like mine,

465
00:25:01,440 --> 00:25:03,920
Speaker 4: as you hire well right, and you let your good

466
00:25:03,960 --> 00:25:07,000
Speaker 4: people do their work, and you pressure test their thesis,

467
00:25:07,000 --> 00:25:09,439
Speaker 4: and you make sure, as you said, that everybody's singing

468
00:25:09,440 --> 00:25:11,119
Speaker 4: from the same hymn book where they need to be,

469
00:25:12,000 --> 00:25:14,359
Speaker 4: or that they're doing their own thing when that's appropriate,

470
00:25:15,040 --> 00:25:17,680
Speaker 4: and you provide a sort of guidance and oversight opportunities

471
00:25:17,720 --> 00:25:19,679
Speaker 4: to collaborate all those good things.

472
00:25:20,520 --> 00:25:21,200
Speaker 3: You know, our.

473
00:25:21,040 --> 00:25:23,640
Speaker 4: Business in one sense is a simple business. We're here

474
00:25:23,680 --> 00:25:26,239
Speaker 4: to serve our clients. We have all the tools at

475
00:25:26,240 --> 00:25:30,359
Speaker 4: our disposal to serve our clients. We you know, gather

476
00:25:30,480 --> 00:25:35,480
Speaker 4: together routinely to develop thematics and market outlooks and other

477
00:25:35,600 --> 00:25:38,920
Speaker 4: kinds of collateral that both myself and the other senior

478
00:25:38,960 --> 00:25:41,680
Speaker 4: executives can take to our clients as ways to engage

479
00:25:41,680 --> 00:25:44,760
Speaker 4: with them and demonstrate our facility with markets and our

480
00:25:45,080 --> 00:25:48,280
Speaker 4: capabilities and insights. And then you know, basically, I let

481
00:25:48,320 --> 00:25:50,119
Speaker 4: the team do what it does best, which is deliver

482
00:25:50,200 --> 00:25:50,720
Speaker 4: the results.

483
00:25:50,920 --> 00:25:53,200
Speaker 1: So walk us through a day in the life of

484
00:25:53,240 --> 00:25:57,080
Speaker 1: a global CIO with five point seven trillion dollars. I

485
00:25:57,119 --> 00:26:00,840
Speaker 1: would imagine that day to day of fans are just

486
00:26:01,359 --> 00:26:02,280
Speaker 1: so overwhelming.

487
00:26:02,800 --> 00:26:04,959
Speaker 2: No, two days really look exactly alike.

488
00:26:05,200 --> 00:26:08,760
Speaker 4: No, it's a bit of a crazy day. It's one

489
00:26:08,800 --> 00:26:10,879
Speaker 4: of the things I love about the job. But I

490
00:26:10,920 --> 00:26:12,600
Speaker 4: would say the first thing is I spend a lot

491
00:26:12,600 --> 00:26:15,959
Speaker 4: of time with clients. So in the first quarter of

492
00:26:16,040 --> 00:26:20,600
Speaker 4: twenty twenty six, I was on forty five planes traveling

493
00:26:20,600 --> 00:26:27,120
Speaker 4: around the globe Middle East luckily before the war started, Asia, Europe,

494
00:26:27,200 --> 00:26:30,760
Speaker 4: multiple times across the US as well. So I spend

495
00:26:30,800 --> 00:26:33,040
Speaker 4: a lot of time talking to clients of all types.

496
00:26:33,080 --> 00:26:36,360
Speaker 4: So we have, as I mentioned earlier, a large institutional

497
00:26:36,560 --> 00:26:39,760
Speaker 4: base of business that some of the largest central banks,

498
00:26:39,800 --> 00:26:42,639
Speaker 4: sovereign wealth funds across the globe. But we also have

499
00:26:42,720 --> 00:26:45,879
Speaker 4: a lot of private clients. We have private banks that

500
00:26:45,920 --> 00:26:48,520
Speaker 4: we work with, you know, large broker dealers that we

501
00:26:48,560 --> 00:26:51,760
Speaker 4: work with. Sometimes I'll even meet directly with end clients

502
00:26:51,760 --> 00:26:55,200
Speaker 4: depending upon the forum. So's I would say that's probably

503
00:26:55,240 --> 00:26:58,360
Speaker 4: a good chunk of my time. I do a lot

504
00:26:58,359 --> 00:27:01,200
Speaker 4: of time, or spend a lot of I'm rather on

505
00:27:01,320 --> 00:27:04,760
Speaker 4: things like strategy. So we have an executive management team

506
00:27:04,800 --> 00:27:08,200
Speaker 4: which gets together and talks about from a business standpoint,

507
00:27:08,240 --> 00:27:11,360
Speaker 4: where do we want to emphasize, what does that require

508
00:27:11,480 --> 00:27:13,920
Speaker 4: all of us to do so for investments, one of

509
00:27:13,960 --> 00:27:16,120
Speaker 4: our big efforts at the last couple of years.

510
00:27:15,880 --> 00:27:16,680
Speaker 3: Has been innovation.

511
00:27:17,640 --> 00:27:20,600
Speaker 4: Since Ya Shin Hung joined us as CEO in twenty

512
00:27:20,680 --> 00:27:24,720
Speaker 4: twenty two, we've been very aggressive in terms of launching

513
00:27:24,760 --> 00:27:28,639
Speaker 4: new products in new spaces, including partnerships with firms like

514
00:27:28,680 --> 00:27:32,720
Speaker 4: Bridgewater and Apollo. So a lot of the strategy for

515
00:27:32,840 --> 00:27:34,359
Speaker 4: what do we want to do to be relevant to

516
00:27:34,440 --> 00:27:38,480
Speaker 4: our clients globally, Ultimately it comes from the investment team's

517
00:27:38,520 --> 00:27:42,120
Speaker 4: ability to execute against those mandates, and so we spend

518
00:27:42,119 --> 00:27:44,119
Speaker 4: a lot of time talking about what kind of resources

519
00:27:44,119 --> 00:27:45,920
Speaker 4: do we need, what kind of research can we do

520
00:27:46,720 --> 00:27:50,160
Speaker 4: that addresses the client problem we're trying to solve. How

521
00:27:50,200 --> 00:27:53,680
Speaker 4: do we partner effectively with these third parties where they

522
00:27:53,760 --> 00:27:59,080
Speaker 4: might contribute some content, we ultimately own the portfolio construction,

523
00:27:59,160 --> 00:28:01,639
Speaker 4: and we might have our own own research that we

524
00:28:01,680 --> 00:28:04,359
Speaker 4: want to bring into the mix. And so one plus

525
00:28:04,400 --> 00:28:07,480
Speaker 4: one equals three, but ultimately we're accountable to that for

526
00:28:07,520 --> 00:28:11,280
Speaker 4: our clients. And then talent. I mentioned earlier that you know,

527
00:28:11,320 --> 00:28:14,080
Speaker 4: you need to have really good people. So we just

528
00:28:14,119 --> 00:28:16,920
Speaker 4: came off of our annual talent reviews where I get

529
00:28:16,960 --> 00:28:19,959
Speaker 4: all my CIOs in a room we work with our

530
00:28:20,119 --> 00:28:24,200
Speaker 4: HR business partner, we go through our top talent succession planning.

531
00:28:24,920 --> 00:28:27,919
Speaker 4: What kind of vectors do we see coming on the horizon?

532
00:28:28,520 --> 00:28:31,120
Speaker 4: AI right now is a huge theme. So how are

533
00:28:31,160 --> 00:28:35,840
Speaker 4: we readying our teams to be good stewards and users

534
00:28:35,880 --> 00:28:38,400
Speaker 4: of AI and adopt that in ways that we can

535
00:28:38,680 --> 00:28:42,160
Speaker 4: you know, make better efficiencies and better judgments. And then

536
00:28:42,200 --> 00:28:45,600
Speaker 4: the last part of it is there's a lot of reading, listening,

537
00:28:46,280 --> 00:28:50,360
Speaker 4: consuming information. Again, I am expected to, you know, be

538
00:28:50,560 --> 00:28:54,640
Speaker 4: the face of State Street investment management from a client standpoint,

539
00:28:54,680 --> 00:28:56,720
Speaker 4: and so I didn't know what's going on in the world,

540
00:28:56,760 --> 00:28:58,720
Speaker 4: and as you know, the world's been a really crazy

541
00:28:58,760 --> 00:28:59,480
Speaker 4: place this year.

542
00:29:00,040 --> 00:29:07,560
Speaker 1: It certainly has. You mentioned Apollo and Bridgewater. The criticism

543
00:29:07,880 --> 00:29:10,920
Speaker 1: about privates and things like four oh one k's or

544
00:29:11,400 --> 00:29:15,200
Speaker 1: target date products is they're expensive, all right, so you

545
00:29:15,200 --> 00:29:19,440
Speaker 1: don't have the liquidity issue, but they're complex. What's the

546
00:29:19,480 --> 00:29:22,200
Speaker 1: case for putting private assets into a four oh one k?

547
00:29:22,880 --> 00:29:24,760
Speaker 4: I think there are a couple of things, you know,

548
00:29:24,840 --> 00:29:26,960
Speaker 4: first and foremost, if you look at the equity side

549
00:29:26,960 --> 00:29:31,080
Speaker 4: of the ledger, more and more capital creation is happening

550
00:29:31,200 --> 00:29:35,880
Speaker 4: in private markets, meaning pre ipopah I mean back in

551
00:29:35,920 --> 00:29:37,840
Speaker 4: my early part of my career, and I'm sure yours

552
00:29:37,840 --> 00:29:41,400
Speaker 4: as well. If a company came public at one hundred million,

553
00:29:41,440 --> 00:29:43,800
Speaker 4: that was a big number, let alone like a billion,

554
00:29:43,920 --> 00:29:48,000
Speaker 4: that was a well now yeah, so so fast forward,

555
00:29:48,040 --> 00:29:50,600
Speaker 4: you know, and now we're talking literally in hundreds of

556
00:29:50,680 --> 00:29:52,840
Speaker 4: not you know, hundreds of billions or even a trillion dollars.

557
00:29:53,160 --> 00:29:56,800
Speaker 4: So if you think about just that magnitude of opportunity

558
00:29:57,280 --> 00:30:00,480
Speaker 4: that's lost if you can't participate in as mark, it's

559
00:30:00,520 --> 00:30:03,240
Speaker 4: just incredible. So that's number one. If you look on

560
00:30:03,240 --> 00:30:06,360
Speaker 4: the fixed income side, I think you know, we've launched Prive,

561
00:30:06,440 --> 00:30:10,840
Speaker 4: which is a collaboration with Apollo, and there again, this

562
00:30:10,880 --> 00:30:15,200
Speaker 4: is investment grade credit that just happens to be issued

563
00:30:15,280 --> 00:30:18,680
Speaker 4: in private markets instead of public markets for all manner

564
00:30:18,680 --> 00:30:21,160
Speaker 4: of reasons. It could be that the company wanted to

565
00:30:21,160 --> 00:30:23,640
Speaker 4: move quickly, or they didn't want to go through the

566
00:30:23,960 --> 00:30:26,960
Speaker 4: you know, the filing process, or there might be some

567
00:30:27,000 --> 00:30:30,560
Speaker 4: specific assets that they want to collateralize with the loan.

568
00:30:30,640 --> 00:30:35,000
Speaker 4: And so those are really high quality investment grade assets,

569
00:30:35,000 --> 00:30:38,120
Speaker 4: but they collect a premium for an investor because they're

570
00:30:38,120 --> 00:30:39,520
Speaker 4: done through the private.

571
00:30:39,200 --> 00:30:40,560
Speaker 3: Markets instead of the public markets.

572
00:30:40,640 --> 00:30:43,479
Speaker 4: So to us those are just natural extensions of what

573
00:30:43,520 --> 00:30:44,680
Speaker 4: clients should have access to.

574
00:30:45,400 --> 00:30:48,880
Speaker 1: It makes a lot of sense. And we mentioned earlier

575
00:30:49,040 --> 00:30:55,480
Speaker 1: GLD what an incredible run gold had in the twenty tens,

576
00:30:55,680 --> 00:30:58,760
Speaker 1: pretty much right up through last year. It's since so

577
00:30:58,840 --> 00:31:01,840
Speaker 1: off on about twenty twenty three percent something like that.

578
00:31:02,920 --> 00:31:07,440
Speaker 1: When you were thinking about equity and fixed income and alternatives,

579
00:31:07,880 --> 00:31:12,480
Speaker 1: and you see a medal which has been widely traded

580
00:31:12,520 --> 00:31:16,640
Speaker 1: for thousands of years, can I say ten thousand years

581
00:31:16,880 --> 00:31:20,440
Speaker 1: that some people have been called barbaric? How do you

582
00:31:20,520 --> 00:31:27,360
Speaker 1: contextualize how GLD trades and what is driving the psychology

583
00:31:27,360 --> 00:31:30,160
Speaker 1: of those investors versus all these other asset classes.

584
00:31:30,680 --> 00:31:32,840
Speaker 4: Yeah, So again I want to take us back a

585
00:31:32,840 --> 00:31:37,239
Speaker 4: little while, because we were advocating for a position in

586
00:31:37,280 --> 00:31:41,880
Speaker 4: gold and client portfolios for six seven years, so long

587
00:31:41,960 --> 00:31:45,280
Speaker 4: before we had this run up to five thousand and plus.

588
00:31:46,120 --> 00:31:48,640
Speaker 4: And the basis at the time obviously, interest rates were

589
00:31:48,760 --> 00:31:51,800
Speaker 4: very low, so you didn't have an opportunity cost. Today

590
00:31:51,840 --> 00:31:55,400
Speaker 4: that's different, but what we were seeing was that fixed

591
00:31:55,440 --> 00:31:59,640
Speaker 4: income wasn't likely to play the role if historically played

592
00:32:00,080 --> 00:32:04,440
Speaker 4: or supplying portfolios. You had no income, you likely didn't

593
00:32:04,440 --> 00:32:07,600
Speaker 4: have a lot of diversification. Benefit from fixed income, because

594
00:32:07,640 --> 00:32:10,080
Speaker 4: how much lower could rates go, you know, if the

595
00:32:10,200 --> 00:32:13,239
Speaker 4: market crashed, and we weren't even sure it was going

596
00:32:13,280 --> 00:32:16,600
Speaker 4: to provide capital preservation, and we were right if you

597
00:32:16,640 --> 00:32:18,440
Speaker 4: fast forward a couple of years. That turned out to

598
00:32:18,440 --> 00:32:20,480
Speaker 4: be a bit of a challenge as well, and so

599
00:32:20,560 --> 00:32:23,880
Speaker 4: we were looking for other ways or other exposures to

600
00:32:23,880 --> 00:32:26,920
Speaker 4: put into the portfolio that would provide some of that

601
00:32:27,280 --> 00:32:32,080
Speaker 4: cocktail of diversification benefit that fixed income just wasn't likely

602
00:32:32,120 --> 00:32:34,200
Speaker 4: to provide. And so we set on gold for lots

603
00:32:34,200 --> 00:32:37,240
Speaker 4: of reasons. And oh, by the way, we were also

604
00:32:37,400 --> 00:32:40,480
Speaker 4: writing a lot at that point in time about concerns

605
00:32:40,880 --> 00:32:44,440
Speaker 4: with fiscal profligacy and the fact that the US dept

606
00:32:44,440 --> 00:32:47,280
Speaker 4: Burden was getting large, and this is you know, several

607
00:32:47,320 --> 00:32:51,440
Speaker 4: years ago. Now it's obviously much bigger now, and gold,

608
00:32:51,560 --> 00:32:54,080
Speaker 4: to us was kind of an interesting asset that would

609
00:32:54,120 --> 00:32:57,600
Speaker 4: benefit from any kind of debasement concerns or any of

610
00:32:57,600 --> 00:33:01,120
Speaker 4: these other sort of issues. So we advocated clients to

611
00:33:01,160 --> 00:33:03,600
Speaker 4: add it many years ago. Of course, very few of

612
00:33:03,600 --> 00:33:06,760
Speaker 4: those clients did so until it went up to you know,

613
00:33:06,840 --> 00:33:09,880
Speaker 4: three thousand, then suddenly started to see more interests, and

614
00:33:09,920 --> 00:33:13,040
Speaker 4: then four thousand, you start to see a bit more interest.

615
00:33:13,680 --> 00:33:16,160
Speaker 4: But I would say gold still plays an important role

616
00:33:16,160 --> 00:33:16,840
Speaker 4: in a portfolio.

617
00:33:16,920 --> 00:33:19,560
Speaker 3: It doesn't have to be a huge exposure.

618
00:33:20,040 --> 00:33:24,120
Speaker 4: It protects against a number of different tail risks in

619
00:33:24,200 --> 00:33:28,960
Speaker 4: a portfolio. Yes, it's expensive from a carry cost standpoint

620
00:33:29,000 --> 00:33:31,080
Speaker 4: right now, given the give up and fixed income, but

621
00:33:31,400 --> 00:33:34,520
Speaker 4: we still have in our strategic allocation portfolios, you know,

622
00:33:34,720 --> 00:33:37,840
Speaker 4: a couple percent allocated gold because we do think that

623
00:33:37,920 --> 00:33:41,560
Speaker 4: it provides very distinctive benefits in certain kinds of crises.

624
00:33:41,920 --> 00:33:45,120
Speaker 1: So today we have bitcoin cut in half from the

625
00:33:45,160 --> 00:33:50,200
Speaker 1: high and a lot of the narrative around crypto sounds

626
00:33:50,280 --> 00:33:54,040
Speaker 1: like sort of a digital refresh of the historic narratives

627
00:33:54,080 --> 00:33:54,720
Speaker 1: around gold.

628
00:33:55,440 --> 00:33:56,880
Speaker 2: How do you think about crypto?

629
00:33:57,000 --> 00:34:01,640
Speaker 1: Some of your competitors have aggressively pushed into it, others

630
00:34:02,080 --> 00:34:06,440
Speaker 1: have very much steered clear. It might be a little

631
00:34:06,480 --> 00:34:09,719
Speaker 1: early to declare which side is winning, although anything that

632
00:34:09,760 --> 00:34:13,000
Speaker 1: gets cut in half kind of comes with a little

633
00:34:13,040 --> 00:34:15,400
Speaker 1: bit of a black mark on it. How do you

634
00:34:15,440 --> 00:34:17,040
Speaker 1: think about crypto these days?

635
00:34:17,239 --> 00:34:20,960
Speaker 4: Yeah, So I want to just first share a story.

636
00:34:21,760 --> 00:34:24,520
Speaker 4: So back in twenty twelve, so this is many years

637
00:34:24,560 --> 00:34:29,719
Speaker 4: ago now, my daughter and her boyfriend started mining bitcoin,

638
00:34:30,320 --> 00:34:32,360
Speaker 4: and of course being in this industry.

639
00:34:32,400 --> 00:34:33,839
Speaker 3: I thought they were crazy.

640
00:34:33,560 --> 00:34:35,200
Speaker 2: Like, you can't just was it one hundred bucks?

641
00:34:35,440 --> 00:34:37,000
Speaker 4: It was, It was under a thousand. I think it

642
00:34:37,040 --> 00:34:38,920
Speaker 4: might have been five or six hundred, so it wasn't

643
00:34:39,160 --> 00:34:39,960
Speaker 4: quite as low.

644
00:34:39,840 --> 00:34:41,080
Speaker 3: But it was still very, very low.

645
00:34:41,480 --> 00:34:44,279
Speaker 4: And I thought, you can't, just like manufacturer money doesn't

646
00:34:44,280 --> 00:34:46,600
Speaker 4: grow on trees, you can't just manufacture it, you know,

647
00:34:46,600 --> 00:34:47,200
Speaker 4: on a computer.

648
00:34:48,239 --> 00:34:49,520
Speaker 2: But at the time you can.

649
00:34:49,719 --> 00:34:52,440
Speaker 3: It turns out you can. So it's very skeptical.

650
00:34:52,480 --> 00:34:54,839
Speaker 4: But I kicked myself for not having at least bought

651
00:34:54,880 --> 00:34:56,600
Speaker 4: a couple because at the time I could have put

652
00:34:56,680 --> 00:34:58,600
Speaker 4: ten thousand dollars into it and I'd be, you know,

653
00:34:58,920 --> 00:35:01,520
Speaker 4: ten million. We might not even be having this conversation today.

654
00:35:01,560 --> 00:35:04,080
Speaker 2: Who knows we would. It would just be on your

655
00:35:04,120 --> 00:35:05,560
Speaker 2: yacht off, well you.

656
00:35:05,480 --> 00:35:07,640
Speaker 4: Go, which wouldn't be half bad, right, It wouldn't be

657
00:35:07,680 --> 00:35:12,280
Speaker 4: half bad. So in an event, I've never really understood

658
00:35:11,800 --> 00:35:16,000
Speaker 4: the case. Now, what I will acknowledge is that over

659
00:35:16,080 --> 00:35:18,680
Speaker 4: the years I did learn of a couple use cases

660
00:35:18,680 --> 00:35:20,640
Speaker 4: that made sense to me. So I can remember seeing

661
00:35:20,680 --> 00:35:24,760
Speaker 4: a woman from Pakistan present and she was talking about

662
00:35:24,800 --> 00:35:27,920
Speaker 4: like why bitcoin is so popular in Pakistan. It was

663
00:35:27,960 --> 00:35:31,360
Speaker 4: because at least they had a stable currency because it

664
00:35:31,400 --> 00:35:34,600
Speaker 4: was pegged to the dollar effectively, and so people preferred

665
00:35:35,120 --> 00:35:39,080
Speaker 4: being paid in bitcoin instead of getting paid in Pakistani.

666
00:35:39,840 --> 00:35:42,719
Speaker 4: So so I thought, okay, well that's interesting, but that's

667
00:35:42,800 --> 00:35:44,239
Speaker 4: a you know, a tiny little use case.

668
00:35:44,640 --> 00:35:45,480
Speaker 3: But I never really.

669
00:35:45,400 --> 00:35:48,160
Speaker 4: Understood because you don't have anybody who's got the taxing

670
00:35:48,200 --> 00:35:52,000
Speaker 4: authority or the backing of it, whereas even with gold,

671
00:35:52,160 --> 00:35:54,520
Speaker 4: it's sort of got the central bankers as a collective

672
00:35:54,600 --> 00:35:58,120
Speaker 4: in some sense back gold. Sure, there's still massive buyers

673
00:35:58,160 --> 00:36:02,000
Speaker 4: of gold. In fact, that's U S. Treasury holdings. So

674
00:36:02,040 --> 00:36:05,840
Speaker 4: I never really got it. But you know, you fast

675
00:36:05,840 --> 00:36:07,840
Speaker 4: forward and suddenly you've got an asset that's up to

676
00:36:07,920 --> 00:36:10,840
Speaker 4: thirty thousand, forty thousand, you know, over one hundred thousand

677
00:36:11,000 --> 00:36:13,600
Speaker 4: at one point in time, and you're like, am I wrong?

678
00:36:13,719 --> 00:36:16,320
Speaker 4: Like what am I missing? So I don't know, the

679
00:36:16,440 --> 00:36:19,359
Speaker 4: jury's out. We do believe in the sort of the

680
00:36:19,440 --> 00:36:23,279
Speaker 4: digital ecosystem very much. We're trying to, you know, work

681
00:36:23,320 --> 00:36:25,680
Speaker 4: on tokenization, and we're working on all kinds of other

682
00:36:25,760 --> 00:36:28,320
Speaker 4: sort of digital finance types of endeavors.

683
00:36:28,560 --> 00:36:29,840
Speaker 3: So there's something.

684
00:36:29,520 --> 00:36:32,880
Speaker 4: About the digital that is very compelling, and in a

685
00:36:32,920 --> 00:36:36,719
Speaker 4: weird way, it may be that once that digital infrastructure

686
00:36:36,760 --> 00:36:40,560
Speaker 4: gets more evolved, it'll make bitcoin even less important, right

687
00:36:40,560 --> 00:36:43,759
Speaker 4: because now suddenly you'll get all the benefits of bitcoin

688
00:36:43,800 --> 00:36:46,719
Speaker 4: in terms of the tradeability and all those kinds of

689
00:36:46,719 --> 00:36:50,240
Speaker 4: things without having to have the exposure to an asset

690
00:36:50,280 --> 00:36:52,879
Speaker 4: that I don't know how to price that asset.

691
00:36:52,600 --> 00:36:57,279
Speaker 1: Wildly volatile to say the very really really interesting. Coming up,

692
00:36:57,320 --> 00:37:00,719
Speaker 1: we continue our conversation with Lori final Global CIO at

693
00:37:00,719 --> 00:37:04,640
Speaker 1: State Street talking about the current market environment.

694
00:37:04,960 --> 00:37:06,040
Speaker 2: I'm Barry Ridults.

695
00:37:06,080 --> 00:37:08,320
Speaker 1: You're listening to Masters in Business.

696
00:37:08,280 --> 00:37:11,360
Speaker 2: On Bloomberg Radio. I'm Barry Ridults.

697
00:37:11,440 --> 00:37:14,400
Speaker 1: You're listening to Masters in Business on Bloomberg Radio. My

698
00:37:14,600 --> 00:37:17,759
Speaker 1: extra special guest this week is Lori Heinel. She is

699
00:37:17,880 --> 00:37:22,000
Speaker 1: executive vice president and Global Chief Investment Officer at State

700
00:37:22,080 --> 00:37:26,920
Speaker 1: Street Investment Management, the asset management arm of State Street

701
00:37:26,960 --> 00:37:31,920
Speaker 1: with five point seven trillion, with a t trillion in assets,

702
00:37:32,040 --> 00:37:34,799
Speaker 1: and that says of year end twenty twenty five, and

703
00:37:34,840 --> 00:37:37,760
Speaker 1: we're up ten twelve percent since then in the market.

704
00:37:37,920 --> 00:37:41,000
Speaker 2: So do the math. I'm going to say over six trillion.

705
00:37:41,719 --> 00:37:44,960
Speaker 1: Let's talk a little bit about the current market environment.

706
00:37:46,239 --> 00:37:51,920
Speaker 1: Your global market outlook was titled Forward with Focus that

707
00:37:52,160 --> 00:37:56,480
Speaker 1: sounds like you were constructive on risk assets. I always

708
00:37:56,760 --> 00:37:59,160
Speaker 1: put a question mark where I see but you must

709
00:37:59,160 --> 00:37:59,960
Speaker 1: stay agile.

710
00:38:00,320 --> 00:38:01,480
Speaker 2: Explain what that means.

711
00:38:01,640 --> 00:38:05,360
Speaker 4: Yeah, well, so to your point, we did see twenty

712
00:38:05,400 --> 00:38:08,759
Speaker 4: twenty six as being still a pretty good year for investors.

713
00:38:09,400 --> 00:38:12,240
Speaker 4: We thought that earnings were going to continue to do well.

714
00:38:13,040 --> 00:38:16,200
Speaker 4: We thought that inflation, while not quite back to the

715
00:38:16,239 --> 00:38:19,320
Speaker 4: two percent target that the Fed had set, was marching

716
00:38:19,320 --> 00:38:22,160
Speaker 4: in that direction, would possibly give some more room for

717
00:38:22,239 --> 00:38:25,320
Speaker 4: rate cuts in twenty twenty six. And so when we

718
00:38:25,520 --> 00:38:29,000
Speaker 4: talk about being agile, it was focus on equities over

719
00:38:29,080 --> 00:38:32,279
Speaker 4: fixed income, but do so in a bit more broad

720
00:38:32,360 --> 00:38:35,239
Speaker 4: based way, like don't just put all your eggs into

721
00:38:35,320 --> 00:38:38,439
Speaker 4: the large cap US trade. Look at small caps, maybe

722
00:38:38,440 --> 00:38:41,080
Speaker 4: even look at things like emerging markets, places where you

723
00:38:41,120 --> 00:38:44,080
Speaker 4: might get a bit of broadening out of the market

724
00:38:44,120 --> 00:38:48,040
Speaker 4: as we saw maturation in twenty twenty six. Of course,

725
00:38:48,440 --> 00:38:53,000
Speaker 4: the altercation war with Iran turned out a bit on

726
00:38:53,080 --> 00:38:56,400
Speaker 4: its head, and so for a short moment we were revisiting.

727
00:38:55,960 --> 00:38:57,040
Speaker 3: Whether that was going to be true.

728
00:38:57,080 --> 00:39:00,600
Speaker 4: Obviously, inflation became a bigger sticking point one again or

729
00:39:00,640 --> 00:39:03,960
Speaker 4: a bigger concern once again. Concerns about whether you're going

730
00:39:04,000 --> 00:39:06,200
Speaker 4: to get that broadening out, or whether investors would just

731
00:39:06,200 --> 00:39:09,080
Speaker 4: sort of go back to the trades that they knew

732
00:39:09,120 --> 00:39:12,960
Speaker 4: and loved and had, you know, more security. And but

733
00:39:13,040 --> 00:39:14,839
Speaker 4: I think as we get into the middle of the year,

734
00:39:15,040 --> 00:39:18,520
Speaker 4: we're seeing that our views were largely rewarded that sort

735
00:39:18,520 --> 00:39:21,480
Speaker 4: of moving to small cap and other parts of the

736
00:39:21,520 --> 00:39:24,920
Speaker 4: market certainly have done quite well on a year date basis.

737
00:39:25,000 --> 00:39:28,960
Speaker 4: And you know, we obviously are still worried about fixed

738
00:39:28,960 --> 00:39:31,840
Speaker 4: income and rates and what that might mean as inflation

739
00:39:31,960 --> 00:39:35,399
Speaker 4: remains a bit more tricky. But you know, the prints

740
00:39:35,440 --> 00:39:37,360
Speaker 4: that we're having every month are all over the place.

741
00:39:37,680 --> 00:39:40,040
Speaker 4: Just as we're speaking, we're having a good CPI print,

742
00:39:40,160 --> 00:39:42,839
Speaker 4: right So while we think that the FED is likely

743
00:39:42,840 --> 00:39:44,319
Speaker 4: on hold for the balance of the year, we don't

744
00:39:44,320 --> 00:39:45,920
Speaker 4: see rate hikes in the offing.

745
00:39:46,600 --> 00:39:46,839
Speaker 2: Huh.

746
00:39:47,320 --> 00:39:49,920
Speaker 1: Kind of interest, And we'll talk a little bit about

747
00:39:50,000 --> 00:39:54,200
Speaker 1: CPI and PPI in a bit. You mentioned something that

748
00:39:54,239 --> 00:39:57,680
Speaker 1: I want to explore because it's so interesting. So the

749
00:39:57,760 --> 00:40:01,719
Speaker 1: Magnificent seven and twenty twenty five, I've only two of

750
00:40:01,760 --> 00:40:04,239
Speaker 1: the seven outperformed the S and P five hundred. I

751
00:40:04,239 --> 00:40:08,480
Speaker 1: think it was nvidiaan Google and this year, if you're

752
00:40:08,480 --> 00:40:11,080
Speaker 1: looking at small cap or MidCap, you're looking at growth

753
00:40:11,120 --> 00:40:15,400
Speaker 1: or value. You're looking at Europe, you're looking at developed

754
00:40:15,560 --> 00:40:18,840
Speaker 1: x US, you're looking at em Everything seems to be

755
00:40:18,920 --> 00:40:24,920
Speaker 1: outperforming large cap US growth. Is this just the reason

756
00:40:25,040 --> 00:40:28,719
Speaker 1: to have a diversified portfolio or is it indicating is

757
00:40:28,760 --> 00:40:31,960
Speaker 1: this a cyclical shift, or is this suggesting something else?

758
00:40:32,080 --> 00:40:36,640
Speaker 4: Yeah, well, our view is generally to have a diversified portfolio.

759
00:40:37,080 --> 00:40:40,880
Speaker 4: At the margin, we might favor large cap, or favor Europe,

760
00:40:40,960 --> 00:40:43,840
Speaker 4: or favor emerging markets at different points in time based

761
00:40:43,880 --> 00:40:46,600
Speaker 4: on relative value trading, but we do think that it's

762
00:40:46,800 --> 00:40:50,279
Speaker 4: incredibly difficult to time those inflection points perfectly. And as

763
00:40:50,280 --> 00:40:53,520
Speaker 4: you noted, coming into this year, you still had a

764
00:40:53,520 --> 00:40:56,680
Speaker 4: lot of momentum and flows into the things that have

765
00:40:56,800 --> 00:40:58,839
Speaker 4: done well in the past, including some of those large

766
00:40:58,880 --> 00:41:02,319
Speaker 4: cap names that you mentioned. So, you know, I'm kind

767
00:41:02,360 --> 00:41:04,560
Speaker 4: of a traditionalist in that way. I do believe you

768
00:41:04,560 --> 00:41:07,960
Speaker 4: want to be diversified and have exposures to multiple places.

769
00:41:08,320 --> 00:41:13,200
Speaker 3: But I do think that this AI enthusiasm.

770
00:41:13,280 --> 00:41:16,200
Speaker 4: I believe in it in terms of a technology. But

771
00:41:16,280 --> 00:41:19,960
Speaker 4: when you look at the massive amount of spending that

772
00:41:20,080 --> 00:41:22,880
Speaker 4: is now being undertaken by some of these companies, you

773
00:41:22,920 --> 00:41:26,920
Speaker 4: know they've gone from leveraging balance sheet cash to make

774
00:41:26,960 --> 00:41:30,880
Speaker 4: those investments to now accessing fixed income markets in a

775
00:41:31,239 --> 00:41:35,480
Speaker 4: massive way and even in some cases issuing equities. So

776
00:41:35,560 --> 00:41:38,840
Speaker 4: you do have to sort of wonder whether that you

777
00:41:38,880 --> 00:41:40,840
Speaker 4: know that vein alone is going to be where the

778
00:41:40,880 --> 00:41:43,279
Speaker 4: money is going to be made going forward. I'm not

779
00:41:43,360 --> 00:41:45,960
Speaker 4: saying that you know they can't still generate good earnings,

780
00:41:46,000 --> 00:41:47,480
Speaker 4: but there are plenty of other places.

781
00:41:47,719 --> 00:41:49,560
Speaker 3: If you think about energy, if you think.

782
00:41:49,480 --> 00:41:53,720
Speaker 4: About utilities, you think about all the ecosystem required to

783
00:41:53,840 --> 00:41:58,279
Speaker 4: enable that AI transformation, and then perhaps most importantly, you

784
00:41:58,320 --> 00:42:02,359
Speaker 4: know the real economy and how sectors like finance or

785
00:42:03,040 --> 00:42:06,040
Speaker 4: healthcare or other things are going to benefit from these technologies.

786
00:42:06,080 --> 00:42:06,600
Speaker 3: I think we're just.

787
00:42:06,600 --> 00:42:09,040
Speaker 4: At the tip of the iceberg in terms of what

788
00:42:09,080 --> 00:42:10,960
Speaker 4: that will mean for innovation of productivity.

789
00:42:11,440 --> 00:42:14,680
Speaker 1: So, when you're looking at this enormous capital spend that

790
00:42:15,080 --> 00:42:18,040
Speaker 1: you referenced, and we didn't even bring up all the

791
00:42:18,080 --> 00:42:21,680
Speaker 1: private credit that's been pouring hundreds of billions dollars into that,

792
00:42:22,520 --> 00:42:25,360
Speaker 1: how do you judge when the spending is productive in

793
00:42:25,520 --> 00:42:31,480
Speaker 1: producing sufficient returns. Given how the fire hose of capital,

794
00:42:31,840 --> 00:42:34,160
Speaker 1: there has to be some misallocation and there are going

795
00:42:34,239 --> 00:42:37,040
Speaker 1: to be some winners and losers. But when does the

796
00:42:37,080 --> 00:42:41,040
Speaker 1: next incremental dollar become bad money after good?

797
00:42:41,239 --> 00:42:42,279
Speaker 2: How can we tell.

798
00:42:42,080 --> 00:42:47,080
Speaker 4: We're watching for when does that capex not translate into

799
00:42:47,600 --> 00:42:49,520
Speaker 4: incremental earnings?

800
00:42:49,600 --> 00:42:54,239
Speaker 1: So let's stay with the idea of artificial intelligence. You

801
00:42:54,280 --> 00:42:57,799
Speaker 1: work at a very large asset manager. I would imagine

802
00:42:58,280 --> 00:43:01,320
Speaker 1: the biggest shops have a little bit of an lasting

803
00:43:01,360 --> 00:43:05,280
Speaker 1: advantage in deploying AI, not only looking at their own

804
00:43:05,920 --> 00:43:10,600
Speaker 1: language models that they've created internally, just the ability to

805
00:43:10,680 --> 00:43:14,640
Speaker 1: deploy that capital way that makes them more to deploy

806
00:43:14,760 --> 00:43:18,520
Speaker 1: that technology in a way that makes their capital more efficient,

807
00:43:18,600 --> 00:43:19,360
Speaker 1: more productive.

808
00:43:19,840 --> 00:43:20,359
Speaker 2: How are you.

809
00:43:20,320 --> 00:43:25,879
Speaker 1: Looking at AI from the perspective of the finance set?

810
00:43:27,200 --> 00:43:30,200
Speaker 4: This is a whole podcast in its own right, but

811
00:43:30,360 --> 00:43:32,400
Speaker 4: let me just I guess share a couple of thoughts.

812
00:43:32,920 --> 00:43:36,160
Speaker 4: First and foremost, we've been on the AI journey for

813
00:43:36,440 --> 00:43:40,400
Speaker 4: over a decade. We've been using machine learning and natural

814
00:43:40,520 --> 00:43:45,319
Speaker 4: language processing and other types of technology in our active.

815
00:43:45,040 --> 00:43:46,760
Speaker 3: Strategies for over a decade.

816
00:43:47,760 --> 00:43:50,480
Speaker 4: And I think it's important to also know as a GCIFI,

817
00:43:50,960 --> 00:43:55,160
Speaker 4: we're a highly regulated institution, so we've also spent many,

818
00:43:55,200 --> 00:44:01,040
Speaker 4: many years on the infrastructure, governance other things deploy these

819
00:44:01,080 --> 00:44:07,000
Speaker 4: types of tools, being mindful of cybersecurity threats, privacy, all

820
00:44:07,000 --> 00:44:09,760
Speaker 4: the other things that you would expect a large bank

821
00:44:09,800 --> 00:44:10,880
Speaker 4: to be worried about.

822
00:44:11,640 --> 00:44:12,440
Speaker 3: So where we are.

823
00:44:12,320 --> 00:44:15,320
Speaker 4: Now, I would say the biggest places that we're seeing

824
00:44:16,320 --> 00:44:19,799
Speaker 4: AI support our business are in more things that are

825
00:44:19,960 --> 00:44:23,440
Speaker 4: operational in nature, that are repeatable processes, where we can

826
00:44:23,480 --> 00:44:27,520
Speaker 4: deploy some technology and free up people to do other

827
00:44:27,600 --> 00:44:30,920
Speaker 4: more interesting things. If you think about some of the

828
00:44:30,960 --> 00:44:35,799
Speaker 4: marketing elements, things like r FPS or commentary writing or

829
00:44:35,840 --> 00:44:39,719
Speaker 4: other kinds of client servicing elements, they lend themselves beautifully

830
00:44:39,840 --> 00:44:44,120
Speaker 4: to leveraging this technology. Because you have a database of information,

831
00:44:44,600 --> 00:44:46,760
Speaker 4: the question might get asked in a slightly different way,

832
00:44:47,120 --> 00:44:50,320
Speaker 4: and the AI can actually feedback the most relevant answers.

833
00:44:50,360 --> 00:44:52,280
Speaker 4: And then you have a human in the loop, always

834
00:44:52,320 --> 00:44:55,440
Speaker 4: in our environment today that ultimately owns the final product.

835
00:44:55,520 --> 00:44:59,000
Speaker 4: But those are I think the sort of early wins

836
00:44:59,040 --> 00:45:03,000
Speaker 4: for us is that kind of of efficiency gain leveraging

837
00:45:03,040 --> 00:45:06,480
Speaker 4: people to do more higher order things down the road.

838
00:45:06,520 --> 00:45:09,680
Speaker 4: Will this get more integrated into our investment process. In philosophy,

839
00:45:09,760 --> 00:45:12,279
Speaker 4: we're experimenting with a lot of things. We've got the

840
00:45:12,920 --> 00:45:16,960
Speaker 4: concept of a research copilot, which let's a portfolio manager

841
00:45:17,400 --> 00:45:22,080
Speaker 4: you know, survey hundreds, dozens whatever, you know, research reports

842
00:45:22,080 --> 00:45:24,879
Speaker 4: and do so very efficiently using an AI.

843
00:45:25,160 --> 00:45:25,919
Speaker 3: Type of a tool.

844
00:45:26,320 --> 00:45:28,719
Speaker 4: They still have to you know, pressure tests, whether the

845
00:45:28,760 --> 00:45:31,840
Speaker 4: results are getting back makes sense, and they still ultimately

846
00:45:31,920 --> 00:45:33,440
Speaker 4: make the decision about what they're going to do with

847
00:45:33,480 --> 00:45:36,600
Speaker 4: that information from a portfolio standpoint. But we see lots

848
00:45:36,600 --> 00:45:39,840
Speaker 4: of opportunities for that kind of augmentation of the human

849
00:45:39,880 --> 00:45:40,920
Speaker 4: as well.

850
00:45:41,000 --> 00:45:44,520
Speaker 1: Let's talk a little bit about inflation. We've had a

851
00:45:44,640 --> 00:45:47,560
Speaker 1: series of things that have contributed to it.

852
00:45:48,120 --> 00:45:50,360
Speaker 2: Tariffs, war in the Middle East, et cetera.

853
00:45:50,960 --> 00:45:54,440
Speaker 1: Here we got the best CPI print we've had in

854
00:45:54,640 --> 00:45:59,759
Speaker 1: five years, but that's primarily been because we briefly thought

855
00:45:59,800 --> 00:46:03,000
Speaker 1: the war was over. An oil price is plummeted now

856
00:46:03,040 --> 00:46:06,640
Speaker 1: the war is back on, and I track things like

857
00:46:07,040 --> 00:46:09,840
Speaker 1: the producer price index is six and a half percent.

858
00:46:10,440 --> 00:46:13,040
Speaker 1: We know that's just going to push into final prices over.

859
00:46:12,920 --> 00:46:13,960
Speaker 2: The next few quarters.

860
00:46:14,400 --> 00:46:17,760
Speaker 1: So how do you think about inflation and fixed income

861
00:46:18,480 --> 00:46:25,960
Speaker 1: and specifically, and has macroeconomic forecasting in this environment just

862
00:46:26,040 --> 00:46:29,960
Speaker 1: become I don't want to say impossible, but so challenging.

863
00:46:30,400 --> 00:46:34,399
Speaker 4: Well, macroeconomic forecasting is always difficult, and I would say

864
00:46:34,960 --> 00:46:37,400
Speaker 4: what we've also seen over the last several years is

865
00:46:37,520 --> 00:46:40,839
Speaker 4: data revisions coming in at a massive level too, So

866
00:46:40,880 --> 00:46:43,640
Speaker 4: what you see in a print one day, whether it's

867
00:46:43,680 --> 00:46:46,919
Speaker 4: the payroll data or the DDP or whatever, a quarter

868
00:46:46,960 --> 00:46:50,440
Speaker 4: or later, might be changed pretty dramatically. So you have

869
00:46:50,520 --> 00:46:52,920
Speaker 4: to be a bit humble in this kind of environment

870
00:46:52,920 --> 00:46:54,080
Speaker 4: when you're making any kind.

871
00:46:53,960 --> 00:46:55,120
Speaker 3: Of bold calls.

872
00:46:55,480 --> 00:46:57,680
Speaker 4: But I would say our core view is that inflation

873
00:46:57,800 --> 00:47:01,120
Speaker 4: will still trend lower over time. We think it might

874
00:47:01,160 --> 00:47:03,080
Speaker 4: not get back to the two percent level, but we

875
00:47:03,280 --> 00:47:07,480
Speaker 4: aren't necessarily thinking that six percent is something that's sustainable.

876
00:47:08,360 --> 00:47:10,080
Speaker 4: Good and the bad news here is that when you

877
00:47:10,160 --> 00:47:14,560
Speaker 4: have inflation shock coming from things like commodity prices, they rebase,

878
00:47:15,360 --> 00:47:17,759
Speaker 4: so you get that one time shock and then you're

879
00:47:17,760 --> 00:47:20,279
Speaker 4: done unless there's another shock on top of that. So

880
00:47:20,680 --> 00:47:24,000
Speaker 4: at some point that sort of recalibrates in its own right.

881
00:47:24,480 --> 00:47:26,520
Speaker 4: I think the thing that we've been most surprised by

882
00:47:26,560 --> 00:47:30,160
Speaker 4: this year is the underlying resilience of the US economy.

883
00:47:30,200 --> 00:47:33,560
Speaker 4: In particular, we were thinking that labor markets were going

884
00:47:33,600 --> 00:47:36,200
Speaker 4: to be under a lot more pressure than they ultimately

885
00:47:36,239 --> 00:47:39,640
Speaker 4: have been, at least so far. We thought that the

886
00:47:39,680 --> 00:47:45,239
Speaker 4: inflation coming from the war would filter into other places

887
00:47:45,280 --> 00:47:49,040
Speaker 4: like fertilizer and food and other things which may still happen. Right,

888
00:47:49,080 --> 00:47:52,120
Speaker 4: we haven't gotten through the farming cycle here in the US,

889
00:47:53,280 --> 00:47:56,120
Speaker 4: but we're not seeing the consumer while they're stretched.

890
00:47:56,120 --> 00:47:57,560
Speaker 3: We're not seeing the consumer.

891
00:47:57,239 --> 00:48:00,880
Speaker 4: Necessarily pull back the way that we thought that they might. So,

892
00:48:01,440 --> 00:48:03,080
Speaker 4: you know, the second half will be a very interesting

893
00:48:03,080 --> 00:48:03,640
Speaker 4: second half.

894
00:48:04,160 --> 00:48:06,399
Speaker 1: To say the least. Let's stay with the consumer. There's

895
00:48:06,440 --> 00:48:09,840
Speaker 1: a couple of things that I've noticed that's kind of interesting.

896
00:48:10,320 --> 00:48:15,320
Speaker 1: If we look at the second quarter sector breakdown, consumer

897
00:48:15,360 --> 00:48:20,360
Speaker 1: discretionary worst performer of the group, essentially flat. If you

898
00:48:20,400 --> 00:48:24,959
Speaker 1: look at consumer spending, there's a greater reliance on short

899
00:48:25,040 --> 00:48:29,120
Speaker 1: term credit and credit cards. Then just salary increases, and

900
00:48:29,160 --> 00:48:32,960
Speaker 1: then consumer sentiment, and I think we can all agree

901
00:48:33,280 --> 00:48:37,080
Speaker 1: the University of Michigan sentiment measure has become broken over

902
00:48:37,120 --> 00:48:40,399
Speaker 1: the past few years. But still, what whether you call

903
00:48:40,440 --> 00:48:45,280
Speaker 1: it the vibes, the sentiment, whatever, seems to be shockingly negative.

904
00:48:46,760 --> 00:48:49,480
Speaker 1: I don't disagree with you about the resilience of the economy,

905
00:48:49,520 --> 00:48:52,279
Speaker 1: but how do we figure out what's going on with

906
00:48:52,320 --> 00:48:58,480
Speaker 1: the consumer and their importance to the ongoing resilient economy.

907
00:48:59,120 --> 00:49:01,839
Speaker 4: Well, I think the first thing is that I agree

908
00:49:01,880 --> 00:49:04,360
Speaker 4: with everything you're saying, but they are also offsets. So

909
00:49:04,400 --> 00:49:07,399
Speaker 4: people are getting tax refunds, You've got, you know, other

910
00:49:07,920 --> 00:49:10,920
Speaker 4: benefits coming through from the one big beautiful bill, so

911
00:49:10,960 --> 00:49:13,240
Speaker 4: you do have some other things that are still propping

912
00:49:13,320 --> 00:49:14,640
Speaker 4: up the consumer at the margin.

913
00:49:14,800 --> 00:49:17,560
Speaker 3: And employment still is.

914
00:49:17,000 --> 00:49:20,160
Speaker 4: Is pretty strong here in the USA, so you still

915
00:49:20,200 --> 00:49:23,080
Speaker 4: have pretty good sort of underpinnings, if you will. But

916
00:49:23,239 --> 00:49:27,200
Speaker 4: it's clear that the average consumer is feeling like they're

917
00:49:27,200 --> 00:49:29,840
Speaker 4: losing ground right there. Been you know, lots of articles

918
00:49:29,880 --> 00:49:32,600
Speaker 4: about even couples that are making over one hundred thousand

919
00:49:32,600 --> 00:49:35,640
Speaker 4: dollars feeling like they have food insecurity. Well, that's a

920
00:49:35,719 --> 00:49:37,759
Speaker 4: problem for sure, and it probably means they're going to

921
00:49:37,760 --> 00:49:40,279
Speaker 4: pull back somewhere else. But my point is that in

922
00:49:40,320 --> 00:49:44,080
Speaker 4: the aggregate, whether it's from Capex and other corporate spending,

923
00:49:44,719 --> 00:49:48,480
Speaker 4: the sort of K shaped consumer economy where the upper echelon,

924
00:49:48,560 --> 00:49:51,479
Speaker 4: if you will, is being benefited by housing prices, which,

925
00:49:51,719 --> 00:49:54,520
Speaker 4: while they're plateauing, have come up a lot, but outset

926
00:49:54,520 --> 00:49:57,080
Speaker 4: prices that are going up a lot, still, there's still

927
00:49:57,080 --> 00:49:58,319
Speaker 4: a lot of resiliency there.

928
00:49:58,640 --> 00:50:01,000
Speaker 2: So I'm glad you work both of those up.

929
00:50:01,040 --> 00:50:05,919
Speaker 1: The pushback I get from bearish colleagues are A, Yeah,

930
00:50:05,920 --> 00:50:08,640
Speaker 1: the economy looks good, but it's almost all driven by

931
00:50:08,680 --> 00:50:13,040
Speaker 1: the upper quarter, and I think that's being generous on

932
00:50:13,120 --> 00:50:16,680
Speaker 1: the quartel side. But the other criticism is, hey, all

933
00:50:16,719 --> 00:50:21,800
Speaker 1: of this AI related cap x is masking underlying weakness,

934
00:50:21,880 --> 00:50:25,720
Speaker 1: although I don't see that weakness in much of the data.

935
00:50:26,400 --> 00:50:28,959
Speaker 1: What's your response to those sort of criticisms.

936
00:50:29,080 --> 00:50:31,720
Speaker 4: Look, I think that the good and the bad news

937
00:50:31,880 --> 00:50:33,759
Speaker 4: is that you don't need one hundred percent of the

938
00:50:33,760 --> 00:50:37,240
Speaker 4: consumers to participate to have the consumer economy.

939
00:50:36,800 --> 00:50:37,720
Speaker 3: Doing just fine.

940
00:50:37,800 --> 00:50:40,440
Speaker 4: So that's a sad thing in a lot of ways,

941
00:50:41,000 --> 00:50:45,040
Speaker 4: but it's just the reality. And by the way, companies

942
00:50:45,120 --> 00:50:49,840
Speaker 4: are generating productivity from things like the deployment of AI already,

943
00:50:49,880 --> 00:50:51,520
Speaker 4: and we think that that's very constructive.

944
00:50:52,280 --> 00:50:55,800
Speaker 1: And then speaking of productivity, we really haven't talked about

945
00:50:56,200 --> 00:50:59,200
Speaker 1: you know, everybody talks about the Magnificent seven. What about

946
00:50:59,239 --> 00:51:02,799
Speaker 1: the other for NAT ninety three companies in spy that

947
00:51:03,400 --> 00:51:07,480
Speaker 1: are becoming more efficient, more productive, more profitable. How do

948
00:51:07,520 --> 00:51:09,120
Speaker 1: we contextualize that.

949
00:51:09,600 --> 00:51:11,719
Speaker 3: Well, we think we're in the very very early in things.

950
00:51:11,719 --> 00:51:14,080
Speaker 4: So I mentioned earlier, we've got active teams, right, and

951
00:51:14,080 --> 00:51:16,399
Speaker 4: this is their domain. Right. So these are people who

952
00:51:16,440 --> 00:51:18,960
Speaker 4: are in the tech sector, in the healthcare sector, in

953
00:51:19,000 --> 00:51:21,600
Speaker 4: the finance sector, doing the hard work to understand.

954
00:51:21,239 --> 00:51:22,799
Speaker 3: Who the winners and losers are going to be.

955
00:51:23,280 --> 00:51:25,880
Speaker 4: And the mantra over and over again is that the

956
00:51:25,960 --> 00:51:30,279
Speaker 4: companies that adopt technology for efficiency, gain for innovation, to

957
00:51:30,360 --> 00:51:32,919
Speaker 4: create competitive modes are going to have a really good

958
00:51:33,000 --> 00:51:36,680
Speaker 4: runway from that deployment. So we are quite optimistic in

959
00:51:36,719 --> 00:51:38,839
Speaker 4: terms of what that means for long term prospects.

960
00:51:39,239 --> 00:51:42,279
Speaker 1: So before I get to my favorite questions, there were

961
00:51:42,320 --> 00:51:44,719
Speaker 1: a couple of items I had to talk to you

962
00:51:44,800 --> 00:51:49,600
Speaker 1: ask you about that are a little more off the

963
00:51:49,640 --> 00:51:55,600
Speaker 1: beaten path. You were chosen to lead State Streets Fearless

964
00:51:55,680 --> 00:52:00,359
Speaker 1: Girl campaign. Explain what that is and why you were

965
00:52:00,400 --> 00:52:02,239
Speaker 1: chosen to take that role.

966
00:52:02,480 --> 00:52:06,080
Speaker 3: Yeah, so this is true serendipity, right.

967
00:52:06,160 --> 00:52:09,839
Speaker 4: So, as with anything, these things take a village, right.

968
00:52:09,880 --> 00:52:12,799
Speaker 4: And so we had this placement of what is now

969
00:52:12,840 --> 00:52:16,440
Speaker 4: the iconic statue of the Fearless Girl, initially down on

970
00:52:16,520 --> 00:52:20,160
Speaker 4: Bowling Green facing off against the bull. And I had

971
00:52:20,200 --> 00:52:22,319
Speaker 4: been one of several people who had been involved in

972
00:52:22,360 --> 00:52:25,879
Speaker 4: that effort and got a call the night before the

973
00:52:25,920 --> 00:52:28,640
Speaker 4: statue was going to be placed and somebody said, can

974
00:52:28,680 --> 00:52:29,040
Speaker 4: you go to.

975
00:52:29,000 --> 00:52:32,040
Speaker 3: New York like now and be there when.

976
00:52:31,880 --> 00:52:35,760
Speaker 4: We place this statue, just in case there's a tension,

977
00:52:35,840 --> 00:52:37,759
Speaker 4: just in case some of the networks pick it.

978
00:52:37,760 --> 00:52:41,560
Speaker 2: Up, and just to just to flesh that out a

979
00:52:41,600 --> 00:52:42,000
Speaker 2: little bit.

980
00:52:42,400 --> 00:52:46,680
Speaker 1: Everybody knows the Wall Street Charging Bull is actually not

981
00:52:46,760 --> 00:52:49,800
Speaker 1: on Wall Street. It's on Lower Broadway. It's a massive

982
00:52:50,000 --> 00:52:58,520
Speaker 1: twenty five ton statue. The Fearless Girl is proportional real life.

983
00:52:57,360 --> 00:53:02,160
Speaker 1: A little girl just standing up to the bull, their

984
00:53:02,200 --> 00:53:05,319
Speaker 1: little hands on our hips, so almost like a big

985
00:53:05,440 --> 00:53:08,800
Speaker 1: goulp exactly staring down the bull.

986
00:53:09,120 --> 00:53:11,879
Speaker 2: So tell us what happened with Yeah, to New York.

987
00:53:11,960 --> 00:53:14,719
Speaker 4: So I fly down, I you know, show up the

988
00:53:14,760 --> 00:53:17,680
Speaker 4: next morning, bright and early, and you know, there's a

989
00:53:17,680 --> 00:53:19,960
Speaker 4: little bit of milling around. Happened to be a rainy day,

990
00:53:20,040 --> 00:53:22,359
Speaker 4: so there weren't too many people out and about. But

991
00:53:22,880 --> 00:53:25,720
Speaker 4: suddenly it started to get a little bit of interest,

992
00:53:25,800 --> 00:53:27,600
Speaker 4: and so we had a couple of reporters, you know,

993
00:53:27,680 --> 00:53:30,160
Speaker 4: come by and say what's happening. We explained to them

994
00:53:30,239 --> 00:53:33,440
Speaker 4: that this was a moment where we were trying to

995
00:53:33,800 --> 00:53:38,359
Speaker 4: advocate for everybody's future and used it as an opportunity

996
00:53:38,480 --> 00:53:41,600
Speaker 4: given it was international Women's Day specifically that that was

997
00:53:41,640 --> 00:53:45,160
Speaker 4: the timing of the placement, and so one thing led

998
00:53:45,200 --> 00:53:46,799
Speaker 4: to another, and before you know it, I'm booked on

999
00:53:46,880 --> 00:53:49,000
Speaker 4: three or four or five news programs over the next

1000
00:53:49,000 --> 00:53:52,319
Speaker 4: forty eight hours and telling the story about how the

1001
00:53:52,320 --> 00:53:54,719
Speaker 4: Fearless Girl came about and why we did it, and

1002
00:53:54,800 --> 00:53:57,960
Speaker 4: how important it was to stand up for those who

1003
00:53:58,000 --> 00:53:59,640
Speaker 4: perhaps couldn't stand up for themselves.

1004
00:53:59,719 --> 00:54:03,840
Speaker 1: So very successful campaign. And where's the Feeliss Girl today?

1005
00:54:03,920 --> 00:54:06,920
Speaker 4: Well, she is now opposite the New York Stock Exchange.

1006
00:54:06,960 --> 00:54:09,160
Speaker 4: So one of the things that happened is that she

1007
00:54:09,239 --> 00:54:12,720
Speaker 4: started to attract so much attention that they were worried

1008
00:54:12,719 --> 00:54:14,840
Speaker 4: about the safety risk because as you know where the

1009
00:54:14,840 --> 00:54:17,680
Speaker 4: bull is that it's a very narrow street there, and

1010
00:54:17,760 --> 00:54:20,600
Speaker 4: people were milling onto the street. So we got a

1011
00:54:20,640 --> 00:54:24,000
Speaker 4: permanent or semi permanent at least for now placement in

1012
00:54:24,000 --> 00:54:25,240
Speaker 4: front of the New York Stock Exchange.

1013
00:54:25,239 --> 00:54:26,160
Speaker 3: And that's where she's been sent.

1014
00:54:26,239 --> 00:54:28,840
Speaker 1: That makes a lot of sense, that's a good location

1015
00:54:29,000 --> 00:54:31,480
Speaker 1: for that. So I know, you serve on a couple

1016
00:54:31,520 --> 00:54:34,640
Speaker 1: of boards. The one that really jumped out at me

1017
00:54:34,760 --> 00:54:37,319
Speaker 1: the Boston Ballet tell us a little bit about what

1018
00:54:37,400 --> 00:54:37,800
Speaker 1: that's like.

1019
00:54:38,200 --> 00:54:42,120
Speaker 4: Yeah, So I've always been a great fan of the arts.

1020
00:54:42,200 --> 00:54:44,680
Speaker 4: I was a gymnast as a child. I wasn't a ballerina,

1021
00:54:44,719 --> 00:54:47,200
Speaker 4: but I think there's a lot of rhyming there. And

1022
00:54:47,520 --> 00:54:49,880
Speaker 4: I've always been a fan of ballet as an art form,

1023
00:54:49,960 --> 00:54:52,640
Speaker 4: and the Boston Ballet is very interesting because they are

1024
00:54:53,080 --> 00:54:56,840
Speaker 4: trying to consolidate both the legacy classical repertoire with a

1025
00:54:56,880 --> 00:55:00,640
Speaker 4: lot of more modern, contemporary, avant garde kinds of repertoire.

1026
00:55:01,000 --> 00:55:05,400
Speaker 4: And so they did a collaboration with the Rolling Stones,

1027
00:55:05,400 --> 00:55:08,279
Speaker 4: for example, where we did a ballet set to some

1028
00:55:08,320 --> 00:55:09,560
Speaker 4: of the Rolling Stones music.

1029
00:55:10,000 --> 00:55:11,440
Speaker 3: And so it's just been a great way to.

1030
00:55:11,400 --> 00:55:14,799
Speaker 4: Meet people in the cultural community in Boston but also

1031
00:55:15,000 --> 00:55:17,920
Speaker 4: be part of art making that you know, I find

1032
00:55:18,120 --> 00:55:18,880
Speaker 4: just fascinating.

1033
00:55:19,040 --> 00:55:21,600
Speaker 1: Huh, really really interesting. So I only have you for

1034
00:55:21,640 --> 00:55:24,400
Speaker 1: a few more minutes. Let me jump to my favorite questions,

1035
00:55:24,920 --> 00:55:27,080
Speaker 1: starting with who were your early mentors?

1036
00:55:27,160 --> 00:55:29,560
Speaker 2: Tell us about who helped shape your career.

1037
00:55:29,760 --> 00:55:32,920
Speaker 4: Yeah, so I would say I didn't really think about

1038
00:55:33,160 --> 00:55:35,520
Speaker 4: mentors when I was younger. I would say my bosses

1039
00:55:35,560 --> 00:55:38,960
Speaker 4: were my mentors in the sense that they stretched me,

1040
00:55:39,080 --> 00:55:43,000
Speaker 4: they gave me opportunities. I talked earlier about that situation

1041
00:55:43,080 --> 00:55:44,920
Speaker 4: at first Boston where we were in front of the

1042
00:55:45,120 --> 00:55:47,600
Speaker 4: airport authority, and you know, I would not have had

1043
00:55:47,640 --> 00:55:49,319
Speaker 4: the opportunity to be in a room like that in

1044
00:55:49,360 --> 00:55:51,280
Speaker 4: a lot of companies. But I think my boss felt

1045
00:55:51,280 --> 00:55:52,919
Speaker 4: that I'd done the work and I deserved a place

1046
00:55:52,920 --> 00:55:55,800
Speaker 4: at the table. So throughout, particularly my early career, I

1047
00:55:55,840 --> 00:55:58,279
Speaker 4: would say it was my bosses who stretched me, gave

1048
00:55:58,280 --> 00:56:01,120
Speaker 4: me opportunities. And then I would say about mid career,

1049
00:56:02,480 --> 00:56:06,160
Speaker 4: with another colleague created this group called Connected Women. It

1050
00:56:06,239 --> 00:56:09,120
Speaker 4: was a very informal type of a thing where a

1051
00:56:09,239 --> 00:56:12,480
Speaker 4: number of women and sort of similar vintages got together

1052
00:56:12,520 --> 00:56:18,000
Speaker 4: regularly and we became vintages. We drank a lot of wine,

1053
00:56:18,040 --> 00:56:20,480
Speaker 4: so I could use the word vantages, so it was

1054
00:56:20,520 --> 00:56:23,640
Speaker 4: really a wine drinking club. But there was a benefit

1055
00:56:23,719 --> 00:56:26,000
Speaker 4: that we got to know each other well our professional

1056
00:56:26,040 --> 00:56:28,359
Speaker 4: and our personal stories, and so we could help each

1057
00:56:28,360 --> 00:56:30,759
Speaker 4: other out. So when we were, you know, looking at

1058
00:56:31,080 --> 00:56:35,200
Speaker 4: career situations, it was a good circle of friends that

1059
00:56:35,239 --> 00:56:38,400
Speaker 4: I could turn to who were in similar states in

1060
00:56:38,440 --> 00:56:41,000
Speaker 4: their careers and trying to make it on the corporate ladder,

1061
00:56:41,080 --> 00:56:41,799
Speaker 4: that I could lean on.

1062
00:56:42,280 --> 00:56:43,400
Speaker 2: Really really interesting.

1063
00:56:44,000 --> 00:56:46,720
Speaker 1: Let's talk about books. Are what are some of your favorites.

1064
00:56:46,719 --> 00:56:47,760
Speaker 1: What are you reading currently?

1065
00:56:47,880 --> 00:56:52,879
Speaker 4: Yeah, so, you know, I tend to like biographies. Read

1066
00:56:53,040 --> 00:56:55,719
Speaker 4: a bunch of the you know, Churnou and you know

1067
00:56:55,800 --> 00:56:59,600
Speaker 4: Titan and House of Morgan and the Walter Isaacs and

1068
00:57:00,080 --> 00:57:03,839
Speaker 4: you know, Steven Jobs. And I like biographies because they

1069
00:57:04,000 --> 00:57:07,480
Speaker 4: meld history with leadership, with whatever.

1070
00:57:07,200 --> 00:57:09,560
Speaker 3: The you know topic is.

1071
00:57:09,640 --> 00:57:12,520
Speaker 4: So obviously, with the you know, the Titan and House

1072
00:57:12,520 --> 00:57:15,560
Speaker 4: of Morgan, it's a finance centric kind of a story,

1073
00:57:15,600 --> 00:57:18,640
Speaker 4: and with Jobs it was a technology centric. But seeing

1074
00:57:18,680 --> 00:57:24,160
Speaker 4: how those leaders navigated you know, innovation, their time, the

1075
00:57:24,200 --> 00:57:27,480
Speaker 4: people around them, I just find that fascinating much better

1076
00:57:27,520 --> 00:57:29,120
Speaker 4: than reality TV in my opinion.

1077
00:57:29,160 --> 00:57:31,080
Speaker 3: Well is reality TV?

1078
00:57:31,920 --> 00:57:33,040
Speaker 2: Speaking about TV?

1079
00:57:33,800 --> 00:57:37,760
Speaker 1: Are you streaming any Netflix or Amazon Prime type? Yeah?

1080
00:57:37,840 --> 00:57:41,680
Speaker 4: Yeah, So right now I am on a bit of

1081
00:57:41,680 --> 00:57:44,520
Speaker 4: a hiatus. I've been trying to read some fiction, so

1082
00:57:44,640 --> 00:57:48,840
Speaker 4: I'm doing some Tony Morrison right now. I went to Princeton,

1083
00:57:48,920 --> 00:57:51,440
Speaker 4: as you probably remember, and so I've been trying to

1084
00:57:51,480 --> 00:57:53,280
Speaker 4: do a bit more reading in my spare time.

1085
00:57:54,600 --> 00:57:57,680
Speaker 1: Our final two questions, what sort of advice would you

1086
00:57:57,720 --> 00:58:01,160
Speaker 1: give to a recent college grad in a career in

1087
00:58:01,240 --> 00:58:03,600
Speaker 1: either investing or asset management.

1088
00:58:04,000 --> 00:58:05,720
Speaker 4: Well, the first thing I would say is it's a

1089
00:58:05,760 --> 00:58:06,920
Speaker 4: fantastic career.

1090
00:58:07,440 --> 00:58:09,680
Speaker 3: You can do so many different things.

1091
00:58:09,760 --> 00:58:13,800
Speaker 4: You get access to technical acumen, you have the interpersonal

1092
00:58:13,800 --> 00:58:16,080
Speaker 4: piece of things. You have to solve problems. I love

1093
00:58:16,120 --> 00:58:18,520
Speaker 4: the problem solving aspect of it, and I think it's

1094
00:58:18,520 --> 00:58:21,000
Speaker 4: something where no matter what your preferences are, you can

1095
00:58:21,040 --> 00:58:23,120
Speaker 4: find your vein right. You know, I happen to make

1096
00:58:23,120 --> 00:58:25,440
Speaker 4: my way to global Chief Investment officer, but there are

1097
00:58:25,440 --> 00:58:29,080
Speaker 4: people in marketing, or people in distribution, or people in processing,

1098
00:58:29,480 --> 00:58:31,800
Speaker 4: and all of those are just absolutely fascinating careers.

1099
00:58:31,840 --> 00:58:33,400
Speaker 3: It's never a dull moment.

1100
00:58:34,080 --> 00:58:36,480
Speaker 1: And our final question, what do you know about the

1101
00:58:36,520 --> 00:58:40,600
Speaker 1: world of investing in asset management today? Might have been

1102
00:58:40,720 --> 00:58:44,280
Speaker 1: useful back in the nineties when you first getting started.

1103
00:58:44,440 --> 00:58:46,880
Speaker 4: Yeah, well, I wish I had started investing earlier and

1104
00:58:47,000 --> 00:58:50,920
Speaker 4: more often. I was a net creditor for many, many,

1105
00:58:51,080 --> 00:58:52,600
Speaker 4: many years because I wanted to.

1106
00:58:52,600 --> 00:58:54,080
Speaker 3: Have nice clothes and jewelry.

1107
00:58:54,440 --> 00:58:57,800
Speaker 1: I can't tell you how often I hear that, which

1108
00:58:57,880 --> 00:59:00,560
Speaker 1: is really just a backdoor ad mission of the power

1109
00:59:00,560 --> 00:59:01,960
Speaker 1: of compounding.

1110
00:59:01,480 --> 00:59:03,400
Speaker 4: And maybe that bitcoin that was my other thing. I

1111
00:59:03,400 --> 00:59:05,800
Speaker 4: probably should have done well twelve if you had.

1112
00:59:05,640 --> 00:59:08,960
Speaker 1: A crystal ball, But what's the big insight that that

1113
00:59:09,200 --> 00:59:12,040
Speaker 1: would have been useful to know generally about marketing.

1114
00:59:12,080 --> 00:59:16,360
Speaker 4: You know, I'm not joking about the early and often,

1115
00:59:16,600 --> 00:59:19,720
Speaker 4: and truth be told, I'm one hundred percent equity invested

1116
00:59:19,800 --> 00:59:20,760
Speaker 4: even now, so.

1117
00:59:20,880 --> 00:59:23,040
Speaker 2: You know I'm a big fan back in my day.

1118
00:59:23,160 --> 00:59:25,240
Speaker 4: You know, it was the one hundred minus your age,

1119
00:59:25,280 --> 00:59:28,000
Speaker 4: which would put me squarely not in one hundred percent

1120
00:59:28,040 --> 00:59:31,439
Speaker 4: equity category if I followed that rubric. But I think

1121
00:59:31,480 --> 00:59:34,160
Speaker 4: a lot of people would just be served by being

1122
00:59:34,200 --> 00:59:36,800
Speaker 4: in equities, you know, for the long term, unless you

1123
00:59:36,880 --> 00:59:39,240
Speaker 4: only have a couple of years and who knows, uh,

1124
00:59:39,320 --> 00:59:40,840
Speaker 4: that's where the money is.

1125
00:59:41,040 --> 00:59:44,240
Speaker 1: This is a little hindsight biased, but I am always shocked.

1126
00:59:44,920 --> 00:59:48,480
Speaker 1: It's literally a chapter in the book of people who

1127
00:59:48,480 --> 00:59:51,520
Speaker 1: are twenty thirty, forty years old that have a substantial

1128
00:59:51,600 --> 00:59:56,080
Speaker 1: fixed income. I understand it's ballast that offsets the volatility

1129
00:59:56,120 --> 00:59:59,840
Speaker 1: of equity, but really, until you're over fifty, maybe even

1130
01:00:00,000 --> 01:00:03,880
Speaker 1: over sixty, do you and getting closer and closer retirement,

1131
01:00:04,240 --> 01:00:06,240
Speaker 1: do you really need to have forty percent of your

1132
01:00:06,280 --> 01:00:08,800
Speaker 1: portfolio in bonds. It doesn't make a whole lot of sense.

1133
01:00:09,080 --> 01:00:11,520
Speaker 4: Well, look, I mean for a lot of institutional clients,

1134
01:00:11,520 --> 01:00:14,320
Speaker 4: it makes perfect sense. They're liability matching right, and they

1135
01:00:14,400 --> 01:00:16,880
Speaker 4: need that fixed income. And I think if you need liquidity,

1136
01:00:17,080 --> 01:00:19,920
Speaker 4: or you're going to have your children's college education or

1137
01:00:20,000 --> 01:00:22,000
Speaker 4: weddings or things like that in a couple of years,

1138
01:00:22,280 --> 01:00:25,600
Speaker 4: absolutely fixed in come plays a role. But if you

1139
01:00:25,680 --> 01:00:28,640
Speaker 4: have the ability to not touch that investment capital, I

1140
01:00:28,680 --> 01:00:29,840
Speaker 4: think equities.

1141
01:00:29,480 --> 01:00:29,960
Speaker 3: Is a way to go.

1142
01:00:30,240 --> 01:00:32,640
Speaker 1: Thank you, Laurie for being so generous with your time.

1143
01:00:32,920 --> 01:00:36,000
Speaker 1: If you enjoy this conversation, well check out any of

1144
01:00:36,040 --> 01:00:39,280
Speaker 1: the six hundred and forty nine podcasts we've done over

1145
01:00:39,320 --> 01:00:45,440
Speaker 1: the past fourteen years. You can find those at Apple Podcasts, Spotify,

1146
01:00:45,560 --> 01:00:50,160
Speaker 1: Bloomberg YouTube, wherever you get your favorite podcasts. I would

1147
01:00:50,160 --> 01:00:52,680
Speaker 1: be remiss if I didn't thank our correct team that

1148
01:00:52,760 --> 01:00:55,280
Speaker 1: helps put these conversations.

1149
01:00:54,720 --> 01:00:56,080
Speaker 2: Together each week.

1150
01:00:56,200 --> 01:01:01,200
Speaker 1: Alexis Noriega is my video producer. Sean Russo is my researcher.

1151
01:01:01,760 --> 01:01:06,840
Speaker 1: Anna Luke is my producer. I'm Barry Ritolts. You've been

1152
01:01:06,880 --> 01:01:10,320
Speaker 1: listening to Master's in Business on Bloomberg Radio