Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: As frequent listeners know, we record this on Thursdays generally,
Speaker 2: and apparently we're going to get a biblically bad storm
Speaker 2: this weekend in the New York City area.
Speaker 1: And you are like, yes, yeah.
Speaker 2: I feel like we had a real storm this past weekend,
Speaker 2: and it was like criminally under hypes. I had no
Speaker 2: idea what was coming.
Speaker 1: I was also surprised by the snow. I used to
Speaker 1: like snow a lot more before I became a suburban
Speaker 1: data and now it's like sho anymore.
Speaker 2: Burrow into your heart, try to find that childlike joy
Speaker 2: I try.
Speaker 1: I just pretty deeply buried under for chaos. Sure, sure,
Speaker 1: you don't have to shovel the snow. I was telling
Speaker 1: you before this, and you were like, you like gave
Speaker 1: me the impression that you had like fifteen minutes of
Speaker 1: a material on the snowstor on this weekend.
Speaker 2: Mostly I just wanted to talk about like why was
Speaker 2: no one Like there's been a lot of headlines like
Speaker 2: first big snowstorm of the Mom Donnie era, and it's like,
Speaker 2: are we all just trying to forget that last weekend happened?
Speaker 2: I feel like that was the first big snowstorm.
Speaker 1: Our colleague Joe wasn't that I was tunting about prediction markets.
Speaker 2: For this, Oh, they're popping off. I'm sure this is
Speaker 2: the first time I've ever felt inclined to get involved
Speaker 2: in a prediction market.
Speaker 1: View of that.
Speaker 2: Oh yeah, speaking of folks writing in, we have some
Speaker 2: JP Morgan material to get through. The first is a correction,
Speaker 2: And I mistakenly said in last week's podcast that JP
Speaker 2: Morgan CEO Jamie Diamond did not attend the JP Morgan
Speaker 2: Healthcare Conference which I attended, and I'm sorry I was
Speaker 2: mistaken he was in attendance. You Well, The thing is,
Speaker 2: I was like acutely aware of his presence last year
Speaker 2: because we were recording in a hallway, which I guess
Speaker 2: something I don't want to get myself into more correction territory.
Speaker 2: But he was giving some sort of fireside or keynote
Speaker 2: address and the hallway that we were in was somehow
Speaker 2: on the route, so people were lining up behind us
Speaker 2: and it was like an enormous scene and everyone was
Speaker 2: talking about Jamie Diamond. So again I was keenly aware.
Speaker 2: Didn't have that experience this year, so I assumed that
Speaker 2: he didn't attend, but that was you know what assuming
Speaker 2: does makes you make corrections on podcasts. We have another
Speaker 2: JP do.
Speaker 1: Before we do that, I'm going to say hello and
Speaker 1: welcome to the Money Stuff podcast. Right, You're a weekly
Speaker 1: podcast where we talk about stuff for that of the Money.
Speaker 1: I'm Matt Levine and I read the Money Stuff column
Speaker 1: from Bloomberg Opinion.
Speaker 2: And I'm Katie Greifeld, a reporter for Bloomberg News and
Speaker 2: an anchor for Bloomberg Television.
Speaker 1: What else you got on JP? Morgan?
Speaker 2: Oh, I was just going to talk about the pub.
Speaker 1: Of the pub.
Speaker 2: Is included in.
Speaker 1: The banter, talk about it.
Speaker 2: The banter this week is very long.
Speaker 1: It's the it's the whole episode. It's just the weather
Speaker 1: and the pub. Although they did get sued for d
Speaker 1: banking Donald Trump. Yeah on Thursday, which we should.
Speaker 2: Yeah, we'll get there.
Speaker 1: The pub.
Speaker 2: Yeah, the pub. Yeah. I'm excited going tonight at their office.
Speaker 1: It's been twenty percent of the content of this podcast.
Speaker 1: They have a pub at their office. Yes, your brand
Speaker 1: new office. Yeah, you've given us some tights and figures.
Speaker 2: About Yeah, I know so much about this office.
Speaker 1: At that pub, they serve drinks although allegedly not before
Speaker 1: were you a clock? I think we.
Speaker 2: Said I'm on the air until five something after five.
Speaker 2: I can't stress test that.
Speaker 1: Yes, you will definitely get served at the JP Morgan Pub.
Speaker 2: I hear the guinness is particularly excellent.
Speaker 1: So do you hear that?
Speaker 2: I have heard that you can get screen printed on
Speaker 2: the foam the building itself.
Speaker 1: No, Yeah, like you can get like Latart on your Guinness.
Speaker 2: Yeah, I've heard that. I've also I don't know if
Speaker 2: this is true. I'm excited to find out that you
Speaker 2: can get a screen printing of Jamie Diamond's face as
Speaker 2: well on your Guinness. That's what I've heard. That's what
Speaker 2: I've heard. I'm gonna I'm going to check this. Yeah,
Speaker 2: you will.
Speaker 1: You will certainly order multiple Guinness. Yeah, yet every available
Speaker 1: image printed on them?
Speaker 2: Yeah, photograph them if I can. If there's photography allowed,
Speaker 2: the photography? Am I even allowed to say that I'm
Speaker 2: going to the pub tonight? Well here by next week.
Speaker 1: Issue another correction. You did not go to the podcast.
Speaker 2: I'm pretty excited. I saw it the outside of it.
Speaker 2: When of the pub.
Speaker 1: Inside the office, you saw the facade of the pub
Speaker 1: of the town square in the middle of the Javi Worgon.
Speaker 2: Office, exactly.
Speaker 1: Excellent.
Speaker 2: So now I'm.
Speaker 1: Inside your way past the bell.
Speaker 2: Yeah, so that's what I had in terms of JP
Speaker 2: Morgan content. But you're right, we should briefly talk about debate.
Speaker 1: Yeah, I don't lawsuit, but like I gather from like
Speaker 1: what I've read on the Bloomberg summary, I thot that
Speaker 1: it's not long on law.
Speaker 2: Yeah, to recab President Donald Trump issuing JP Morgan and
Speaker 2: Jamie Diamond himself for at least five billion dollars over
Speaker 2: those allegations that it stopped offering him in his business's
Speaker 2: banking services for political reasons, and they did for seven weeks.
Speaker 2: They closed accounts of Trump and his businesses. After January sixth,
Speaker 2: twenty twenty one.
Speaker 1: Banks shot accounts for various reasons. Banks have gotten a
Speaker 1: lot of trouble for banking Jeffrey Epstein. They weren't like
Speaker 1: co conspirators in his crimes. They were providing him banking services.
Speaker 1: And if you provide banking services to people who give
Speaker 1: off red flags of committing crimes, then you get in
Speaker 1: a lot of trouble. Right, and after January sixth, it
Speaker 1: might have been reasonable for jpmore to think we don't
Speaker 1: want to be involved in banking people who have been
Speaker 1: involved in certain sorts of criminal activity, right, But that
Speaker 1: sort of criminal activity is now associated with a certain
Speaker 1: sort of politics, So you can say you were banking me,
Speaker 1: de banking me because of politics rather than because of crime.
Speaker 2: Yeah, it's all. It's a little bit interesting when paired
Speaker 2: with what happened to Brian moynihan at Davos. Brian Mornihan
Speaker 2: didn't get past the velvet rep being the CEO of
Speaker 2: Bank of America, the Ft.
Speaker 1: Reported also in Victoria's d Banker.
Speaker 2: Yeah, well, the Ft reported that the White House excluded
Speaker 2: Brian moynihan from a Davos reception that included the leaders
Speaker 2: of other banks and financial institutions, and one of the
Speaker 2: reported reasons was potentially de banking. Yeah, the suspicion of
Speaker 2: d banking. Yeah, this is.
Speaker 1: Like I was not a successful investment banker, and via
Speaker 1: some level, well, I'm not a good financial journalist. Like,
Speaker 1: no part of me wants to go to Davas, And
Speaker 1: like if I happened to find myself at Davas, like
Speaker 1: no part of me would want to go to the
Speaker 1: Trump reception. But like that's that's the job, right, Like,
Speaker 1: that's the job.
Speaker 2: Well, Jamie Diamond was there. Jane Frasier was there.
Speaker 1: Jamie Diamond was there.
Speaker 2: Yeah, I know, I guess they had dinner and then
Speaker 2: you know what.
Speaker 1: I'm going to tell you about my week?
Speaker 2: Yeah, please, I have a meme cwin. Yes, you didn't
Speaker 2: create it.
Speaker 1: The opposite of haveing memequin. The memequin was foisted upon me.
Speaker 1: Let me take a step back and tell this story.
Speaker 1: So the guy named Steve Yager, who's a software developer,
Speaker 1: launched this thing called gas Town, which is like a
Speaker 1: AI coding vibe cooding situation. It's like open source software
Speaker 1: that he announced and people liked and got a lot
Speaker 1: of attention. And at some point he did that genor
Speaker 1: first and at some point that in the last couple
Speaker 1: of weeks, someone launched a meme coin called gas on
Speaker 1: a crypto platform. And the idea is, like, it's a
Speaker 1: meme coin that has the same name as gas Town,
Speaker 1: So if you like think that gastown is a cool project,
Speaker 1: maybe you'll buy the meme coin. Like whatever, this classic
Speaker 1: meme coin logic, there's no connection. The person who launched
Speaker 1: it wasn't the guy who launched gas Town. It's just like, yeah,
Speaker 1: I wants it on a platform. But the way this
Speaker 1: platform works is that when the token trades, it generates
Speaker 1: what they call royalties like trading piece and the royalties
Speaker 1: you know, some like whatever, like one percent of the
Speaker 1: trade volume or something, and the royalties a crue to someone.
Speaker 1: When you launch the coin, you can designate who gets
Speaker 1: the royalties, and the person who launched this coin said
Speaker 1: the royalties would accrue to the developer who launched gas Town.
Speaker 1: So there is a connection between the coin and the
Speaker 1: open source project. The connection is that the coin generates
Speaker 1: some money for the developer of the project, not because
Speaker 1: he launched the coin, not because he had anything to
Speaker 1: do with it, but just because they were like, we'll
Speaker 1: get some of this money to him.
Speaker 2: It's sort of like a non consensual I mean, it's
Speaker 2: not exactly.
Speaker 1: What people used to call on air drop, but it's
Speaker 1: related to the idea of an air drop in crypto,
Speaker 1: where like someone just gives you a coin and they're like, oh,
Speaker 1: you have this coin, right, and why do they do that? Well,
Speaker 1: what happened here is that someone who was involved in
Speaker 1: or at least owned some of the crypto tuging emailed
Speaker 1: the developer and was like, hey, you have all these
Speaker 1: royalties waiting for you. All you have to do is
Speaker 1: like set up an account, connect your Twitter to the
Speaker 1: crypto platform, and then.
Speaker 2: Like you can withdraw buy Solana.
Speaker 1: He had to open a Salona wallet to withdraw the money.
Speaker 1: So yeah, and he was like, that's weird. And then
Speaker 1: he did it and he was like, oh wow, I
Speaker 1: really got the money.
Speaker 2: I love the excerpt that you included.
Speaker 1: Yeah, yeah, he wrote. He was like, because it sounds
Speaker 1: like a scam. It sounds like, yeah, just tho it's Alana,
Speaker 1: while I didn't send it, but in fact it was
Speaker 1: real apparently, and he withdrew something like seventy thousand dollars
Speaker 1: of royalties and then here's the important thing. Then he
Speaker 1: blogged about it, and he's got a big platform people
Speaker 1: let gas down, and he bligged about it for apparently
Speaker 1: a couple of reasons. One is that he thought it
Speaker 1: was good. Hecalls it an engine that fuels creation, just
Speaker 1: like the stock market. That is like, because this thing
Speaker 1: is retroactively financing his open source software project. He thinks
Speaker 1: it's cool, right, It's like, this is a way to
Speaker 1: fund projects through like crowd meme something something right, So
Speaker 1: one he thought it was cool and then too. The
Speaker 1: other reason he blied about it is because that will
Speaker 1: get attention to it, which will one make the token
Speaker 1: go up. And I think he ended up buying some
Speaker 1: of the token and to create more royalties for him.
Speaker 1: So he actually wrote in his blog posts, allow me
Speaker 1: to get Richard just by telling you about it. Yeah,
Speaker 1: just like a good line. And so he did that
Speaker 1: and I read about it because I thought that was
Speaker 1: funny in various ways. He's not wrong that it's it's
Speaker 1: a way to finance something something. I don't know that
Speaker 1: it's a sustainable way to like fund a lot of projects,
Speaker 1: but it is like in certain sort of crowdsourceing memei
Speaker 1: areas of the world, it's a way for people will
Speaker 1: get money.
Speaker 2: It almost months we have a Patreon.
Speaker 1: It has some Patreon like elements. But let me tell
Speaker 1: you like one reason that it is not like a Patriot,
Speaker 1: which is that you got tens of thousands of dollars
Speaker 1: out of this, but the market capital of the Clian
Speaker 1: at some point I went from like kind of zero
Speaker 1: to like forty million dollars in back down. You know,
Speaker 1: the people who I think I have no proof of
Speaker 1: this is like I just looking at the market dynamics.
Speaker 1: The people I think made a lot of money on this.
Speaker 1: The people who bought the coin cheap emailed him, We're like, hey,
Speaker 1: blog about this. He blogs about it, the coin goes up,
Speaker 1: and they make a lot of money selling it. Right,
Speaker 1: So it is not just a way to funnel money
Speaker 1: to creators. It's a way to funnel money to creators
Speaker 1: while also giving a lot of that money to the
Speaker 1: people involved in the crypto trading. Sean Geteker wrote a
Speaker 1: blog post about this with the title crypto grifters are
Speaker 1: recruiting open source AI developers, which is I think closer
Speaker 1: to my view of it than like this is a
Speaker 1: way to fuel creation. But in any case, it's interesting.
Speaker 1: They called it meme coin venture capital, and like, you know,
Speaker 1: as in regular venture capital, you know, the entrepreneurs get
Speaker 1: some of the money and the finance series get some
Speaker 1: of the money. You can quibble over the split of.
Speaker 2: That, and so how do you factor in about it?
Speaker 1: Yes, and then someone launched one for me, of course,
Speaker 1: so I wrote about that in my column the next day.
Speaker 1: But I'm not going to name the coiner of the platform.
Speaker 1: I do not want people trading the thing to generate
Speaker 1: royalties for me, for reasons on the record. One of
Speaker 1: them is you heard it here as a matter of
Speaker 1: journalistic ethics and Bloomberg standards and everything like that, and
Speaker 1: another is like, I'm not going to log into the thing,
Speaker 1: like I'm not taking the money. But you know, there's
Speaker 1: like supposedly ten thousand dollars in an account for me.
Speaker 2: That is an okay, horse, you can do a lot
Speaker 2: with that.
Speaker 1: I love that your conception of money is.
Speaker 2: Just thinking, how do you think about what you can
Speaker 2: do with ten thousand dollars?
Speaker 1: I don't, because like there's no part of you that
Speaker 1: it's tempted to get and spend this ten thousand dollars.
Speaker 2: I mean, you'd have to put some work into it,
Speaker 2: but I.
Speaker 1: Don't know that's that much work. But it's like putting
Speaker 1: like passwords into some.
Speaker 2: Oh no, into the horse, I mean to the horse.
Speaker 1: Yeah, I'm not going to buy a horse. No, it's
Speaker 1: not my Well, you're not going to use of ten
Speaker 1: thousand dollars.
Speaker 2: You're not going to take the money.
Speaker 1: I'm not going to take the money.
Speaker 2: I'm surprised there hasn't been some sort of matt Levine
Speaker 2: meme coin.
Speaker 1: There probably has been. Yeah, this is like the first
Speaker 1: one that I know that like attempts to generate profits
Speaker 1: for me personally.
Speaker 2: So, yeah, there's something that I was wondering about as
Speaker 2: I was reading your initial.
Speaker 1: I just want to be really clear, don't buy it.
Speaker 2: Don't buy it.
Speaker 1: I don't want you to assume me if you like,
Speaker 1: don't buy it and then it goes up. But to
Speaker 1: the extent you were buying it for reasons relating to
Speaker 1: wanting to help me or thinking that I will talk
Speaker 1: about it more like, don't buy it for those reasons.
Speaker 1: I'm not going to talk about it more and I'm
Speaker 1: not going to be helped by any aspect of it.
Speaker 2: We'll speak.
Speaker 1: I don't own it, you don't own it. I'm not
Speaker 1: getting the royalties. No, I didn't launch it. I had
Speaker 1: no involvement in it. All I've done is talk about it.
Speaker 1: But I have not talked about it in an encouraging way.
Speaker 2: No, no, a negative way. If you will speaking doing
Speaker 2: something that I was wantondering about reading your initial entry.
Speaker 2: When it comes to Gastown, let's say that he was
Speaker 2: receiving no economic benefit from this meme coin and it
Speaker 2: has no actual connection to gas Town. If that happened,
Speaker 2: if you started a thing and then someone launched a
Speaker 2: meme coin that is connected only a name, do you
Speaker 2: have any sort of recourse, Like can you sue them
Speaker 2: for trying to ride the popularity of your things?
Speaker 1: I think it practically it's often hard to sue them.
Speaker 1: It's came up a lot in NFTs, like people would
Speaker 1: do NFTs like linked to other people's art. Yeah, you know,
Speaker 1: because you're like an NT is like an online pointer
Speaker 1: to an image, right, and you just take someone else's
Speaker 1: image and then you're selling an NFT of it. People
Speaker 1: I think have tried last But I think it's hard
Speaker 1: because these are typically somewhat anonymous, these centralized platforms, and
Speaker 1: like they're not Yeah, it's not an obvious person to sue,
Speaker 1: And you know, I don't know. I mean, it seems
Speaker 1: like it could in some circumstances be a copyright violation,
Speaker 1: but like, yeah, you got to wait into like some
Speaker 1: weird corners of the Internet.
Speaker 2: What are you going to do?
Speaker 1: What are you going to do?
Speaker 2: I just love the phrase moonshot. Do I think it's
Speaker 2: so romantic. Moonshot anyway, pay packages that is what we're
Speaker 2: talking about specifically, Yeah, so romantic.
Speaker 1: There's a Boss Journal story about an equilar study of
Speaker 1: let me try to do the math here. There's some
Speaker 1: CEOs who got moonshot compensation packages, which they defined as
Speaker 1: compensation packages that had like a notional value of at
Speaker 1: least ten thousand horses.
Speaker 2: That's really funny. I really had a thousand horses.
Speaker 1: Or one hundred million dollars. I hope I did the
Speaker 1: math right. It used to be that the CEOs got
Speaker 1: paid millions of dollars, and now there's a new vogue
Speaker 1: for paying them in a form that sort of looks
Speaker 1: like zero ish dollars plus a bajillion dollars if they
Speaker 1: hit some very aggressive growth in stock price targets over
Speaker 1: like some long period of time. The idea is like, one,
Speaker 1: it's like a long term alignment of incentives, and two
Speaker 1: it is incentives to like do a lot right. So
Speaker 1: it's not just like steadily grow profits. It's like transform
Speaker 1: the company or make it huge. And this is like
Speaker 1: probably wasn't invented at Tesla, but it's very Tesla, right,
Speaker 1: Like Tesla in twenty eighteen gave Elon Musk like a
Speaker 1: people throw on the number of fifty six billion. I think, like,
Speaker 1: you know, give him some tens of billions of dollar
Speaker 1: package if he grew the company ten x and then
Speaker 1: he did, and then they gave him the money, and
Speaker 1: then they've talked about a lot and now they've given
Speaker 1: him another one that's like a trillion dollars of extra
Speaker 1: equity if he goes to eight point five trillion. And
Speaker 1: other people were like, oh, Elon must did it, it must
Speaker 1: be cool. And so a lot of companies have done
Speaker 1: these packages and what the eqular that he found is
Speaker 1: that most of them, most of those companies have underperformed
Speaker 1: at the SNP. Yeah, which, as I wrote, makes total
Speaker 1: sense because these are supposed to be like a moonshots,
Speaker 1: right and like most of the time they shouldn't work out,
Speaker 1: and they're getting no reward for matching the S and
Speaker 1: P performance, right, Like that's not what they're there for.
Speaker 1: They're there to like ten X to the company, and
Speaker 1: if they can't do that, then like they'll fall short
Speaker 1: and there'll be a bad payoff, right, And the idea
Speaker 1: of these moonshots is like most of them won't work out,
Speaker 1: and some of them will work out enormously well, and
Speaker 1: so if you're a diversified shareholder, you'll get, you know,
Speaker 1: the benefit of a few companies.
Speaker 2: I think the companies went into it with that attitude though,
Speaker 2: like this probably won't work out.
Speaker 1: No, but that's fine. Everyone thinks they're going to be
Speaker 1: the successful moonshot, right, Like, but if you're a shareholder,
Speaker 1: if you're a diversefied chaholder, like, that's fine. You have
Speaker 1: like ten CEOs who think they're going to get to
Speaker 1: the moon, and eight of them are diluted and two
Speaker 1: of them are right, and you don't know which is which,
Speaker 1: but they let them all try. You know, the CEO
Speaker 1: is all thinking, oh, of course I'll do this right
Speaker 1: if some of them are wrong, like, that's good for
Speaker 1: shaholders as long as some of them are right.
Speaker 2: I really liked that framing thinking about it through the
Speaker 2: perspective of a shareholder, and obviously my brain went to
Speaker 2: you could construct a moonshot portfolio of these twenty one
Speaker 2: companies or something that Equilar found did this and a.
Speaker 1: Lot of them have under and people Tesla, Yeah.
Speaker 2: That's true. It seems like KKR this is working out
Speaker 2: for them? Who else is it working out for Airbnb also,
Speaker 2: which is interesting, it's specifically not working out for a
Speaker 2: lot of people, including trade desk. But it was interesting
Speaker 2: to see that Equilar was specifically looking at twenty twenty
Speaker 2: and twenty twenty one packages.
Speaker 1: Yeah, so excluding Tesla.
Speaker 2: Excluding Tesla, But it does feel like a moment in time.
Speaker 2: I mean, maybe there have been more in the year since,
Speaker 2: but it feels like twenty twenty, twenty twenty one you
Speaker 2: did see.
Speaker 1: A lot of these that was apparently there were more
Speaker 1: than than before or since. I think some of it
Speaker 1: was the Tesla package was in twenty eighteen, but I
Speaker 1: think you hit the targets in like twenty twenty one, yeah,
Speaker 1: or twenty and so there was a lot of like,
Speaker 1: oh wow, it works. From the perspective of a CEO,
Speaker 1: it's like, oh wow, I could make sixty billion dollars.
Speaker 1: And from the perspective of a board, it's like, oh,
Speaker 1: this incentivization works and gets CEOs to transform companies. Yeah,
Speaker 1: it's a little weird to be a board and be like, well,
Speaker 1: our guy could be Elon Musk too, but it's you know,
Speaker 1: someone's got to be Yeah, Elon Musk two point zero.
Speaker 2: Well, it'll be interesting to see, like what the lag
Speaker 2: effect of his most recent pay package is, like whether
Speaker 2: in I.
Speaker 1: Don't think anyone else is going to get a jillion
Speaker 1: dollar pay package.
Speaker 2: For a while. No, you don't think so, who knows?
Speaker 1: Man? And the other thing I'd say is, like I've
Speaker 1: written this about, you know, his earlier pay package, and
Speaker 1: his trillion dollar pay package is like the classic Moonshot
Speaker 1: pay package is you're an early stage startup founder, right,
Speaker 1: and your pay is like Ramen and thirty percent of
Speaker 1: the equity of a company that is now worth you know,
Speaker 1: nothing ish and it could be worth a trillion dollars, right,
Speaker 1: Like that's the Moonshot pay package. That's the package where
Speaker 1: in theory, you know, every startup CEO is is trying
Speaker 1: to create something out of nothing and if they fail,
Speaker 1: they get roughly nothing, and if they succeed, they get
Speaker 1: Mark Zuckerberg level wealth. And that's like a normal pay package.
Speaker 1: And what this is doing is translating that to giant
Speaker 1: public companies. And it shouldn't work that well, right, Tesla's
Speaker 1: a car company and it makes me correctly and it
Speaker 1: can sell cars, and like now Elin must incentives are
Speaker 1: to transform it utterly to making an eight point five
Speaker 1: trillion dollar company. The theory there has to be like,
Speaker 1: either he will succeed and it will we'll have a
Speaker 1: human odor robot in every home and it will be
Speaker 1: worth eight point five trillion dollars and he'll get paid,
Speaker 1: or he'll fail and he won't get paid and it
Speaker 1: won't like sell cars anymore. I don't know, like you're
Speaker 1: sort of making these like very bold bets, and that
Speaker 1: makes sense when you're a startup, and maybe makes less
Speaker 1: sense for a large public company, but maybe it makes
Speaker 1: more sense. On don't know, Maybe it's what the shralders want.
Speaker 2: Can you walk me through the psychology of the CEOs
Speaker 2: who canceled their Moonshot? Oh? Like the psychology you're just like,
Speaker 2: I'm not going to do this.
Speaker 1: This is all stock options, right. It works is like
Speaker 1: you're optimistic. The board is like, we're gonna pay you
Speaker 1: a lot of stock options that will be worth a
Speaker 1: lot of the thought goes up and be worth nothing
Speaker 1: if the stock goes down, and you're like, great, the
Speaker 1: stock will go up. And then the stock goes down
Speaker 1: and you're like, well, but I'm a nice guy. Like
Speaker 1: I come in every day, I work hard, Like why
Speaker 1: am I not getting paid? And the board is like,
Speaker 1: you're right, and they cancel your stock options and give
Speaker 1: you a new stock options so you still get paid.
Speaker 1: And like the Moonshot stuff is like that too, right.
Speaker 1: It's like at the beginning of the Moonshot package, it's
Speaker 1: like you'll get nothing unless you're ten x the company,
Speaker 1: which case we get a bajillion dollars, right, and then
Speaker 1: after two years you're like, well, I'm not gonna ten
Speaker 1: next to the company, but like, ye, I'm working hard
Speaker 1: and then I get fine, take some money. That's the psychology.
Speaker 1: It's pretty reasonable. Yeah, it's on the theoretical level, like
Speaker 1: this sort of like all or nothing that creates the
Speaker 1: right incentives to like, you know, they're working hard.
Speaker 3: They're fine.
Speaker 2: What an interesting article that landed on Monday, so I
Speaker 2: didn't fully appreciate it until Tuesday because Monday was a holiday.
Speaker 1: The new or Executy Change and or related entities are
Speaker 1: building a twenty four ish hour, seven ish day trading
Speaker 1: idea based on blockchain.
Speaker 2: Yeah, tokenized stocks and ETFs, and you can train them
Speaker 2: walk out, you can train them around the clock. ETFs
Speaker 2: they're building it, that is.
Speaker 1: They're thinking about it. It's in the works.
Speaker 2: Yeah. I feel like we've been talking about the concept
Speaker 2: of twenty four to seven trading for a while.
Speaker 1: Yeah, and has the usual problems lighter liquidity if you
Speaker 1: are market makers at two am. What I was interesting
Speaker 1: about this story was that it's and I'd never really
Speaker 1: like closely thought about this, but it's combined with blockchain.
Speaker 1: Blockchain blockchain tokenizing stocks. And there is kind of a
Speaker 1: reason for that, which is that traditionally trade and settlement
Speaker 1: are separated in a world of business hours and sort
Speaker 1: of serious institutional trader, like you do a trade between
Speaker 1: nine thirty and four on a Monday, and then you know,
Speaker 1: you get the cash and you deliver the shares sometime
Speaker 1: on Tuesday, and like it's all sort of like civilized,
Speaker 1: but in a world of like catering to retail traders
Speaker 1: who want to trade twenty four seven, like settlement is
Speaker 1: an obstacle there, Like it would be weird to do
Speaker 1: a trade at midnight on Friday and then I have
Speaker 1: three days of like the money hasn't landed in your
Speaker 1: account yet. It's not like the experience that you're expecting
Speaker 1: when you're trading twenty four to seven, right, and so
Speaker 1: the bloom work. Sorry, right, Catherine already quotes Michael Blackground
Speaker 1: at and I say saying, we think it aligns with
Speaker 1: the retail investors emerging desire to be able to trade
Speaker 1: something at five oh four pm on a Saturday and
Speaker 1: then use that money to buy something else at five
Speaker 1: oh five pm on a Saturday.
Speaker 3: Right.
Speaker 1: You can't use the money if you just like do
Speaker 1: a trade and then it doesn't settle. Right. You're combining
Speaker 1: the twenty four seven trading with real time settlement, and
Speaker 1: the way to do that these days is by token
Speaker 1: eyes and talking about the blockchain. It's not the only
Speaker 1: way to do real time settlement, but that's the way
Speaker 1: everyone talks about it now.
Speaker 2: Yeah, and also it's a language that I feel like
Speaker 2: the people who care about this know the idea. Yeah,
Speaker 2: blockchain tokenization. We actually spoke to Michael Blogrund on UTFIQ,
Speaker 2: which is a television show in addition to being my
Speaker 2: newsletter I ever heard, and he was talking about like,
Speaker 2: you know, they're in conversations with a lot of crypto
Speaker 2: native firms who are really excited about this, but also
Speaker 2: the largest some of the largest etf issuers out there,
Speaker 2: and it's all about like getting their products in the
Speaker 2: digital wallets of the next generation investors. So that's who
Speaker 2: they're going after, and that's a language that they know
Speaker 2: it all.
Speaker 1: Yeah, language I don't know, as we've already established.
Speaker 2: So we'll see. I mean they're in talks with the SEC.
Speaker 2: It's not a Johne deal.
Speaker 1: It's a pretty good time to be in. Talked about
Speaker 1: blockchaining and tokenized something something.
Speaker 2: Yeah, So were you saying that you don't think like
Speaker 2: tokenization is inevitable or twenty four to seven trading.
Speaker 1: Oh, I don't think the tokenization is an absolute requirement
Speaker 1: for real time settlement, but it's how it's going to happen, right, Yeah,
Speaker 1: it's gonna happen.
Speaker 2: Because I was going to say, like twenty four to
Speaker 2: seven trading feels inevitable. Yes, it's coming.
Speaker 1: Yeah, although it's always like twenty three and a half,
Speaker 1: you know. Yeah, you need like time to reset the
Speaker 1: computers up.
Speaker 2: I did like how you framed in your column that
Speaker 2: I'm trying to imagine another app, Like if I was
Speaker 2: like a huge fan of an app on my phone
Speaker 2: and then it stopped working at four pm on Friday,
Speaker 2: and I couldn't use it all weekend. It would kind
Speaker 2: of be like what am I doing?
Speaker 1: Like I come from a world where like, yes, like
Speaker 1: you go home at four o'clock on Friday, you don't
Speaker 1: trade stocks for a while. But like that's not like
Speaker 1: an app native living on your phone.
Speaker 2: Yeah, you grew up on the internet and with these apps.
Speaker 2: Then that doesn't really make sense.
Speaker 1: Trade sucks all.
Speaker 2: The time it's happening.
Speaker 1: Like one possibility is you'll have very limited liquidity and
Speaker 1: lots of craziness overnight. But another possibility is like, eh,
Speaker 1: like everyone just put their traders on two shifts and
Speaker 1: you know, like it's mostly computers. Anyways, you need someone
Speaker 1: on the night shift super rise the computer and like
Speaker 1: maybe it's all fun, Maybe it's fine.
Speaker 2: I think it would be really fun to be on
Speaker 2: the night shift, just.
Speaker 1: Like the one person with a bank of computers that
Speaker 1: are like trading against retail dj ns all night long.
Speaker 2: I picture a cozy dark room, the warm glow of
Speaker 2: your computer screen, right, siff in your tea, got.
Speaker 1: Myls aren't going down too much?
Speaker 2: My flannel pajama bottoms on. Yeah that sounds good.
Speaker 1: I don't think you know, I think that job will
Speaker 1: be like you're wearing a suit and you're in Tokyo.
Speaker 1: But it's possible.
Speaker 2: Yeah, but that's not very romantic. Yeah, all right. I
Speaker 2: feel like we covered a lot of grounds, a lot
Speaker 2: of good good luck, good luck in the snow.
Speaker 1: Every book at the pub.
Speaker 2: Oh yeah, thank you.
Speaker 1: And that was the Money Stuff Podcast.
Speaker 2: I'm Matt Levine and I'm Katie Greifeld.
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Speaker 1: The Money Stuff Podcast is produced by Anam Aserakis, Moses
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