WEBVTT - Andrew Ross Sorkin Talks Newest Book, Comparison to Modern Times 0:00:02.520 --> 0:00:07.360 Bloomberg Audio Studios, Podcasts, radio news. 0:00:07.800 --> 0:00:11.160 Carol Master along with Tim stenovikleven Our Bloomberg Interactive Broker Studio. 0:00:11.200 --> 0:00:14.280 We all just listen to Jamie Diamond on Bloomberg. JP Morgan, 0:00:14.320 --> 0:00:17.040 by the way, featured very prominently in a new book 0:00:17.079 --> 0:00:19.279 out on the nineteen twenty nine market crash, and this 0:00:19.400 --> 0:00:21.920 feels like kind of the right conversation to be having 0:00:22.280 --> 0:00:25.240 at this moment in time when certain investing narratives dominate 0:00:25.720 --> 0:00:30.720 US financial markets, AI, private credit, transparency concerns, crypto prediction markets, 0:00:30.720 --> 0:00:34.199 and more questions about whether these narratives are the right 0:00:34.240 --> 0:00:37.040 ones that lead to longer term gains and prosperity for 0:00:37.120 --> 0:00:38.680 investors and for the country. 0:00:38.680 --> 0:00:39.800 There's a lot of questions. 0:00:39.560 --> 0:00:42.479 Out there, yeah, stub about exuberants as well. Could it 0:00:42.560 --> 0:00:44.360 lead to a crisis or to a crash? It does 0:00:44.440 --> 0:00:46.440 lead us to nineteen twenty nine, a book that takes 0:00:46.520 --> 0:00:49.320 us inside the greatest crash in Wall Street history and 0:00:49.360 --> 0:00:51.879 how it shattered a nation. The book by New York 0:00:51.880 --> 0:00:54.640 Times bestselling author of Too Big to Fail, who also 0:00:54.720 --> 0:00:56.680 happens to be an award winning journalist for The New 0:00:56.760 --> 0:00:59.280 York Times. He's a founder and editor at large of 0:00:59.320 --> 0:01:02.960 Deal Book. He's anchor of Squawk Box on CNBC. Andrew 0:01:03.040 --> 0:01:05.880 Ross Sorkin joins us. Now, welcome, thanks for having me, guys. Yeah, 0:01:05.880 --> 0:01:08.000 thanks for jeving me here. You know, it's funny. Jamie 0:01:08.080 --> 0:01:10.959 Diamond was asked about just now by David Rubinstein about 0:01:11.000 --> 0:01:14.440 the financial crisis and about whether or not we could 0:01:14.520 --> 0:01:17.800 have another big financial crisis. Our question for you is, 0:01:18.240 --> 0:01:20.760 in this day and age, could we have another nineteen 0:01:20.800 --> 0:01:24.520 twenty nine like stock market crash? Or is the structure 0:01:24.600 --> 0:01:27.520 just completely different? Are the protections now in place? Could 0:01:27.560 --> 0:01:28.279 it happen again? 0:01:28.600 --> 0:01:31.720 So yes and no. I can explain why no, And 0:01:31.760 --> 0:01:33.720 then if you'd like, I can get you there if 0:01:33.760 --> 0:01:36.200 you want to get if you want to go there. Look, 0:01:36.720 --> 0:01:40.120 the good news is the world is very different today 0:01:40.319 --> 0:01:42.640 from a technology perspective. One of the reasons that nineteen 0:01:42.680 --> 0:01:45.680 twenty nine ever even happened was literally the stock exchange 0:01:45.920 --> 0:01:48.840 was oftentimes off, meaning the numbers that you saw on 0:01:48.880 --> 0:01:52.240 the big board were three four five hours behind the 0:01:52.360 --> 0:01:55.760 actual the actual numbers, and as a result, people were 0:01:55.760 --> 0:01:58.640 just selling indiscriminately because they just thought the whole thing 0:01:58.640 --> 0:02:00.960 didn't even work. I mean, one of the reasons you 0:02:00.960 --> 0:02:03.680 always see this famous pictures of people down the New 0:02:03.720 --> 0:02:06.320 York SAX ex Change next Planta. The reason they're there, 0:02:06.360 --> 0:02:08.240 the reason they're all in the street, is these are 0:02:08.240 --> 0:02:10.160 people who come from all over New York and the 0:02:10.200 --> 0:02:11.920 rest of the country to try to find out, like 0:02:12.000 --> 0:02:15.560 what's happened to their money. So that piece of it 0:02:15.639 --> 0:02:17.200 you take off the table because you can get the 0:02:17.240 --> 0:02:19.600 numbers right here and off of your terminal and everything else. 0:02:21.240 --> 0:02:25.480 There's an SEC Insider trading is not legal. It was 0:02:25.600 --> 0:02:28.519 legal then, sore all the manipulation that was taking place. 0:02:28.880 --> 0:02:32.880 There was no FDIC, so you had bank runs that 0:02:32.919 --> 0:02:36.760 took place in the aftermath of this crisis. You know, 0:02:36.880 --> 0:02:40.160 we could talk about Glass Stiegel and what that either 0:02:40.160 --> 0:02:42.280 representator didn't or whether you think it's come back or not. 0:02:42.480 --> 0:02:45.639 But here's a bigger one. Capital requirements for banks there 0:02:45.680 --> 0:02:49.080 were none zero back then. So there's a lot of 0:02:49.320 --> 0:02:54.240 reasons you'd like to believe that we can't have another 0:02:54.280 --> 0:02:57.000 crisis of the magnitude we did. And by the way, 0:02:57.000 --> 0:02:59.360 it's also worth noting the crash in nineteen twenty nine. 0:03:00.000 --> 0:03:02.680 It wasn't preordained that when that happened that we had 0:03:02.720 --> 0:03:06.120 to have a Great Depression. That was really the first 0:03:06.160 --> 0:03:08.480 domino of a series of dominoes, and then a series 0:03:08.520 --> 0:03:12.320 of frankly terrible policy choices, the Federal Reserve basically doing nothing, 0:03:12.560 --> 0:03:16.880 the implementation of tariffs. We can discuss what that means today. 0:03:16.960 --> 0:03:18.639 You know, there was a gold standard, so there was 0:03:18.639 --> 0:03:20.320 a question about how much money you could throw into 0:03:20.360 --> 0:03:24.680 the system. Austerity, all of that that worked against things 0:03:24.720 --> 0:03:26.840 that led to twenty five percent of unemployment didn't have 0:03:26.880 --> 0:03:28.480 to happen, if you will. 0:03:28.520 --> 0:03:29.760 I have to say that was one of the things 0:03:29.800 --> 0:03:31.200 in reading your book that I was like, wait, I 0:03:31.200 --> 0:03:32.800 think there was just an assumption that it was the 0:03:32.840 --> 0:03:34.600 market crash that caused the great depressions. 0:03:34.639 --> 0:03:37.560 Always everybody fasted, like there's one bad day and then 0:03:37.600 --> 0:03:41.040 somehow there's a great depression. But there's so much in between. 0:03:41.400 --> 0:03:43.800 You know, listen, so many people on your book tours 0:03:43.840 --> 0:03:46.200 like everybody's like, nineteen twenty nine happen again. And I 0:03:46.200 --> 0:03:48.320 do wonder, is there a better, smarter question that we 0:03:48.360 --> 0:03:51.440 should be asking you. Having done all this research and 0:03:51.520 --> 0:03:54.080 taken us back there, making us feel like we. 0:03:53.960 --> 0:03:56.440 Were in the room when it happened, you know that 0:03:56.480 --> 0:03:57.120 we should. 0:03:56.840 --> 0:03:59.240 Be asking you, Well, look, it didn't happen, and then 0:04:00.720 --> 0:04:02.960 I'll tell you, I'll give you actually how you could 0:04:03.000 --> 0:04:06.280 get to nineteen thirty two today, And that sort of 0:04:06.320 --> 0:04:11.080 maybe speaks to this. So one of the lessons that 0:04:11.120 --> 0:04:13.360 came out of nineteen twenty nine, it was actually the 0:04:13.400 --> 0:04:15.400 lesson that Ben Bernanke learned when he was doing his 0:04:15.520 --> 0:04:19.240 Great his thesis on the Great Depression at Princeton is 0:04:19.640 --> 0:04:21.920 when there's a crash or a crisis or a panic, 0:04:22.640 --> 0:04:25.400 the playbook is to throw money at the problem. Maybe 0:04:25.480 --> 0:04:28.200 politically unpopular, but that is the lesson. And he did 0:04:28.240 --> 0:04:29.600 it in two thousand and eight, and by the way, 0:04:29.600 --> 0:04:32.640 we did it again during the pandemic. And I think 0:04:32.680 --> 0:04:34.760 we now think that there is a playbook. And by 0:04:34.800 --> 0:04:37.640 the way, there's also therefore a put on the market 0:04:37.640 --> 0:04:40.680 because we now we have the playbook. The one thing 0:04:40.720 --> 0:04:44.520 that's different this time is if you genuinely believe every 0:04:44.560 --> 0:04:47.120 financial crisis to some degree is a function of debt. 0:04:47.160 --> 0:04:50.000 Too much debt in the system. So far we're all 0:04:50.000 --> 0:04:53.520 talking about corporate debt. Really back then, there was in 0:04:53.600 --> 0:04:56.640 nineteen twenty nine, there was a budget surplus in America. 0:04:56.800 --> 0:04:59.520 Now we have thirty eight trillion dollars The question is, 0:05:00.040 --> 0:05:02.880 let's say we have a crash and the government says, 0:05:02.880 --> 0:05:05.640 you know, we're gonna write a check for five trillion dollars. 0:05:05.440 --> 0:05:08.280 That's the put and whether you believe that there is 0:05:08.320 --> 0:05:11.280 some kind of invisible line that turns into a red 0:05:11.360 --> 0:05:13.760 line for the bond market where they say, you know what, 0:05:13.800 --> 0:05:16.880 we like you guys in America. We'll happy to lend 0:05:16.920 --> 0:05:18.880 you money at three or four times the rate that 0:05:18.880 --> 0:05:20.599 we do today. And that's the interest that you're going 0:05:20.640 --> 0:05:22.239 to pay. And then all of a sudden you actually 0:05:22.320 --> 0:05:25.600 do get into some kind of austerity spiral, and then 0:05:25.640 --> 0:05:27.840 you're living at a twenty five percent unemployment rate in 0:05:28.080 --> 0:05:30.960 the country. That's I mean, when you really started trying 0:05:30.960 --> 0:05:32.760 to get through the permittations, how do you get there 0:05:33.640 --> 0:05:36.320 in this day and age. That's one way. One other 0:05:36.360 --> 0:05:39.360 thing that's interesting today is the technology, as bad as 0:05:39.400 --> 0:05:42.120 it was then, in some cases, could even be too 0:05:42.200 --> 0:05:44.600 good today. And I think we learned that with the 0:05:44.640 --> 0:05:49.080 Silicon Valley Bank of Failure, where someone goes on Twitter 0:05:49.120 --> 0:05:51.760 and says, I'm pulling my account. Now that information is accurate. 0:05:51.880 --> 0:05:53.480 Everybody does it over the weekend on their pe. 0:05:53.520 --> 0:05:57.000 Everybody does it. I used to think, oh, this device 0:05:57.080 --> 0:05:59.360 is so great because if there was a bad piece 0:05:59.400 --> 0:06:01.800 of information be corrected very quickly. But if there's an 0:06:02.040 --> 0:06:04.160 accurate piece of information that's not. 0:06:04.240 --> 0:06:06.560 Good, right, people act on it quickly. 0:06:06.640 --> 0:06:08.880 Well, so let's talk more about the technology today and 0:06:09.160 --> 0:06:12.400 sort of parallels and the idea of maybe irrational exuberance 0:06:12.400 --> 0:06:16.680 and signs of irrational exuberance right now. In reading the book, 0:06:16.680 --> 0:06:18.240 in the nineteen twenties, there were certainly a lot of that, 0:06:18.279 --> 0:06:20.160 but it seemed like it was, you know, more on 0:06:20.240 --> 0:06:23.919 credit and people buying on margin. Nowadays, there's the idea 0:06:23.920 --> 0:06:27.360 of crypto some of that has been kind of pulled back, 0:06:27.400 --> 0:06:29.719 and in just a couple of months actually, since since 0:06:29.720 --> 0:06:31.680 you published the book, we've seen something. There is a 0:06:31.680 --> 0:06:33.960 lot of debt in the crypto market, I mean shocking 0:06:34.000 --> 0:06:36.479 about leverage. So there's there's that side of things. There's 0:06:36.520 --> 0:06:39.159 prediction markets and sort of the money that's going into those, 0:06:39.279 --> 0:06:43.800 the excitement around those private credit and concerns about private 0:06:43.839 --> 0:06:46.400 credit that we've seen in the last couple of months, 0:06:46.920 --> 0:06:48.200 any signs of anything there. 0:06:48.360 --> 0:06:51.320 Look, the private credit business has always concerned me because 0:06:51.320 --> 0:06:53.520 of the transparency of it, or frankly, lack of transparence. 0:06:53.520 --> 0:06:54.960 I think if you were to talk to J. Powell, 0:06:55.279 --> 0:06:57.840 he would tell you that, you know, even the Federal 0:06:57.880 --> 0:07:02.479 Reserve doesn't have a full grasp of how interlinked all 0:07:02.520 --> 0:07:04.840 of the debt and credit is in the private credit market. 0:07:04.880 --> 0:07:08.000 Having said that, depending on what numbers you're looking at, 0:07:08.279 --> 0:07:10.080 you could argue, it's only two trillion dollars two trillion 0:07:10.080 --> 0:07:12.200 dollars a lot of money. But it's not. It's not 0:07:12.240 --> 0:07:15.360 the entire market. It's stem So I don't know if 0:07:15.360 --> 0:07:17.880 it's I don't know if it's systemic. By the way, 0:07:17.960 --> 0:07:21.520 I might worry more today about short term treasuries. I mean, 0:07:21.560 --> 0:07:24.480 by the way, we the United States have been trying 0:07:24.480 --> 0:07:26.880 to sell short term treasuries like crazy because we think 0:07:26.880 --> 0:07:29.480 that we can get a cheaper rate that way. That's 0:07:29.520 --> 0:07:32.880 also a much more complicated place to be if, in fact, 0:07:32.920 --> 0:07:35.040 you actually have to pay it back more quickly. 0:07:35.720 --> 0:07:37.520 One of the questions we were kicking around when we're 0:07:37.520 --> 0:07:40.840 thinking about having our discussion with you, is is Wall 0:07:40.840 --> 0:07:42.160 Street greedier today? 0:07:43.720 --> 0:07:45.720 I don't know if it's greedier today. Frankly, I always 0:07:45.800 --> 0:07:47.120 argue agreed, Look, I think. 0:07:46.960 --> 0:07:49.720 There's greed bad necessarily, I think. 0:07:49.600 --> 0:07:51.880 The lesson for me of writing this book in some 0:07:51.920 --> 0:07:54.160 ways was that they didn't use the phrase back then. 0:07:54.440 --> 0:07:58.000 But this idea of fomo, which by the way, is 0:07:58.360 --> 0:08:00.640 driven in part by this phone and talk and people 0:08:00.720 --> 0:08:02.120 seeing all sorts of things, and by the way, I 0:08:02.160 --> 0:08:04.720 think makes inequality. Actually I don't know if it makes 0:08:04.720 --> 0:08:06.840 it worse, but the perception of it and just the 0:08:06.920 --> 0:08:09.480 visibility of it. But I do think the sort of 0:08:09.680 --> 0:08:14.000 fomo greed envy, I think that's what's driven. That is 0:08:14.080 --> 0:08:19.560 what's driven people for you know, the test of time, 0:08:19.760 --> 0:08:21.840 and that's what it is. Is it is it worse 0:08:21.960 --> 0:08:25.000 today than it was before? I don't know, except and 0:08:25.040 --> 0:08:26.760 maybe this gets to the inequality piece. I think there 0:08:26.760 --> 0:08:31.160 are more people who think that they're effectively unable to 0:08:31.200 --> 0:08:34.000 actually make it, and therefore more willing to take risk 0:08:34.440 --> 0:08:36.160 and more willing to sort of try to grab this 0:08:36.320 --> 0:08:39.120 lottery ticket as opposed to sort of make it over 0:08:39.160 --> 0:08:41.480 time slowly. So so on. 0:08:41.480 --> 0:08:45.360 That the ultra wealthy today versus the ultra wealthy back then. 0:08:45.400 --> 0:08:46.640 And reading the book, there's a lot of you know, 0:08:46.679 --> 0:08:48.880 people have their yachts and in some in some cases 0:08:49.000 --> 0:08:52.760 actually sailing to work in Lower Manhattan on the yacht. 0:08:52.840 --> 0:08:57.679 Absolutely today, the wealthiest people today, how much different are 0:08:57.679 --> 0:09:01.800 their lives versus the ultra wealthy, and not with the technology, 0:09:01.800 --> 0:09:03.840 but I mean what they were able to do versus 0:09:03.880 --> 0:09:05.440 what the normal person is able to do. I mean 0:09:05.440 --> 0:09:07.000 you have, you know, billionaires going to space. 0:09:07.040 --> 0:09:08.480 Now, I think. 0:09:08.400 --> 0:09:11.080 There is a distinction. But look, I think you go 0:09:11.200 --> 0:09:15.280 back and I think of JP Morgan's son, he was 0:09:15.280 --> 0:09:20.720 building the biggest, the biggest yacht at the time. People 0:09:20.720 --> 0:09:23.439 would have thought that's like, you know, the gates, Obezos, 0:09:23.760 --> 0:09:26.360 whatever yacht you're thinking of. I think that there was 0:09:26.400 --> 0:09:30.400 a distinction. But I remember having an interesting conversation oddly 0:09:30.480 --> 0:09:33.480 enough to drop a name with President Obama, interesting maybe 0:09:33.520 --> 0:09:38.839 two thousand and fifteen about the idea that and I 0:09:38.880 --> 0:09:42.000 think this is true in the twenties, but really true 0:09:42.040 --> 0:09:46.000 even just twenty five years ago. I think CEOs people 0:09:46.160 --> 0:09:50.040 of means were oftentimes living in the same neighborhoods with 0:09:50.600 --> 0:09:53.280 the people who worked on the factory floor of their companies, 0:09:53.320 --> 0:09:55.520 and as a result, their kids went to the same schools, 0:09:56.440 --> 0:10:00.600 and they went to the same temples and churches, and 0:10:00.760 --> 0:10:02.960 ran into each other at the same restaurants and markets. 0:10:03.360 --> 0:10:06.160 And I think that there's a cohesion there that's important 0:10:06.160 --> 0:10:10.040 for our culture, and I think that increasingly that has 0:10:10.480 --> 0:10:11.040 come apart. 0:10:12.120 --> 0:10:14.160 We were talking with Andrew Ross sork In the book 0:10:14.200 --> 0:10:16.880 is nineteen twenty nine Inside the Greatest Crash in Wall 0:10:16.880 --> 0:10:19.480 Street History and how it shattered a nation. You know, 0:10:19.720 --> 0:10:22.760 politics got in the way of regulating banks and markets 0:10:22.800 --> 0:10:25.120 back then, and I think it was kind of fascinating 0:10:25.720 --> 0:10:26.320 to see. 0:10:26.080 --> 0:10:26.480 Some of that. 0:10:26.600 --> 0:10:29.160 Is there a parallel to that today when you look 0:10:29.160 --> 0:10:31.600 at the activities Andrew coming out of the White House 0:10:32.240 --> 0:10:36.080 on things like cryptocurrencies, regulatory oversight, Like, I just wonder 0:10:36.840 --> 0:10:37.559 how you see that? 0:10:37.840 --> 0:10:40.760 Well, I'll give you actually a parallel that may seem 0:10:41.040 --> 0:10:44.040 like not like a parallel, but to me is which 0:10:44.080 --> 0:10:47.400 is we're all talking about right now the politicization potentially 0:10:47.640 --> 0:10:51.520 and independence of the Federal Reserve. I actually remember, as 0:10:51.559 --> 0:10:53.600 I was working on this book, looking at the diaries 0:10:53.640 --> 0:10:55.800 of a lot of the people who worked on the 0:10:55.880 --> 0:10:58.319 Federal Reserve on the board, and it was still such 0:10:58.360 --> 0:11:01.880 a new institution born in nineteen thirteen that they were 0:11:01.960 --> 0:11:06.040 concerned about the political implications of either raising or lowering 0:11:06.080 --> 0:11:08.080 interest rates at any given moment. They actually cared about 0:11:08.080 --> 0:11:10.760 the politics now It wasn't that Hoover was telling them 0:11:10.800 --> 0:11:13.240 exactly what to do, but they were so scared, not 0:11:13.320 --> 0:11:14.559 that they were just going to get hauled up in 0:11:14.600 --> 0:11:17.120 front of Congress from making the wrong choice, but that 0:11:17.280 --> 0:11:19.800 the entire thing, which people still called back then the 0:11:19.960 --> 0:11:25.400 experiment at that point, that Congress could effectively disband this 0:11:26.000 --> 0:11:28.880 very idea. And so I raised that only because it's 0:11:28.960 --> 0:11:31.400 clear to me that actually the independence of the FED matters. 0:11:31.480 --> 0:11:32.920 In fact, one of the reasons I think that they 0:11:32.960 --> 0:11:35.920 didn't act more forcefully in nineteen twenty nine and in 0:11:36.000 --> 0:11:39.280 nineteen thirty and after that was in part because there 0:11:39.400 --> 0:11:41.920 was their own concern about the politics, putting aside whether 0:11:42.040 --> 0:11:43.920 the White House was telling them one thing to do 0:11:44.040 --> 0:11:44.400 or the other. 0:11:44.480 --> 0:11:47.480 Do we have that today, I think. 0:11:47.400 --> 0:11:51.120 Less so, or at least up until recently less so. 0:11:51.679 --> 0:11:55.840 I think that maybe in the same way that clearly 0:11:55.920 --> 0:11:59.400 those governors of the FED back then were cognizant and 0:11:59.480 --> 0:12:01.720 nervous about the politics. I mean, I don't think this 0:12:01.760 --> 0:12:04.839 bed things are going to be disbanded, but I think 0:12:04.840 --> 0:12:08.760 that they're cognizant. They are very aware, very aware of 0:12:09.080 --> 0:12:12.880 what the President's saying, what their reputations are going to 0:12:12.920 --> 0:12:15.480 be like as a result what people are saying about them, 0:12:15.640 --> 0:12:19.400 whether they have to do certain things to demonstrate their independence. 0:12:19.640 --> 0:12:21.960 I mean, that's the thing. The idea of demonstrating your 0:12:22.000 --> 0:12:24.840 independence effectively means you might even make a decision that 0:12:24.960 --> 0:12:27.280 might not be the decision you'd otherwise make, but you're 0:12:27.320 --> 0:12:30.680 doing it for your own reputation. So yes, I think 0:12:30.679 --> 0:12:33.000 that all of that is not healthy. 0:12:33.600 --> 0:12:35.960 Does the FED keep that in a few months when 0:12:36.040 --> 0:12:38.280 Jay Powell is no longer FED chair, And look, we 0:12:38.280 --> 0:12:41.160 can't see the future. We don't know who will be nominated. 0:12:41.280 --> 0:12:46.320 I have a view that is maybe contrarian in this space, 0:12:46.600 --> 0:12:49.400 which is there's a board and there's a number of 0:12:49.400 --> 0:12:52.880 people on that board. I've never believed that the entire 0:12:53.040 --> 0:12:55.920 FED is controlled by one human being. It just isn't. 0:12:56.559 --> 0:12:59.439 And so I think it's very important who is running 0:12:59.480 --> 0:13:03.800 it telling you it isn't. But I do think there 0:13:03.800 --> 0:13:07.880 will be people on that board, those who care also 0:13:07.920 --> 0:13:11.520 about their own independence, who will, By the way, another 0:13:11.559 --> 0:13:13.800 reason I think Ja Powell may ultimately stay on that 0:13:13.840 --> 0:13:15.240 board for that reason. 0:13:15.000 --> 0:13:17.800 That you went there. Because we're hearing that a lot, right, 0:13:17.920 --> 0:13:18.360 Because we. 0:13:18.360 --> 0:13:20.559 Keep waiting, we're going to expect to hear an announcement. 0:13:20.600 --> 0:13:23.480 It just keeps getting pushed off, and I just think there's. 0:13:23.400 --> 0:13:25.080 A lot no. No, By the way, it's not that 0:13:25.080 --> 0:13:26.200 I think that jap I was going to be in 0:13:26.240 --> 0:13:28.520 this role for forever. They're gonna let him stay, No, 0:13:28.600 --> 0:13:30.560 but just that you know, he can stay for another 0:13:30.600 --> 0:13:32.720 two years after this on the board, on the board, 0:13:32.760 --> 0:13:35.000 and I think it is more likely that he will stay. 0:13:35.280 --> 0:13:38.800 And in fact, to the extent that this the President 0:13:39.000 --> 0:13:41.960 would somehow like to use that spot for for somebody 0:13:42.000 --> 0:13:43.960 that he'd like to nominate, I would argue this, this 0:13:44.000 --> 0:13:47.440 whole thing has backfired. In fact, you know, I was 0:13:47.440 --> 0:13:49.920 talking to Harvey Schwartz at the New York Economic Club 0:13:50.000 --> 0:13:53.640 yesterday from Carlisle, and he made the point most people, 0:13:54.000 --> 0:13:56.600 most taxi drivers, people in the street didn't care about 0:13:56.600 --> 0:13:59.800 the the idea of FED independence at all. A week ago, 0:14:00.080 --> 0:14:01.520 they didn't even know. I mean, this has been an 0:14:01.559 --> 0:14:05.600 academic conversation for the most part. Now it's like a thing. Yeah, 0:14:05.720 --> 0:14:09.200 and people constituents across the country all of a sudden 0:14:09.240 --> 0:14:12.000 care about this issue. They may start to call their Congress. 0:14:12.000 --> 0:14:14.160 I mean, it's very interesting what's happening. 0:14:14.200 --> 0:14:14.400 Yeah. 0:14:14.400 --> 0:14:15.880 I was actually I've shared this story before, but I 0:14:15.880 --> 0:14:18.000 was with a friend's Sunday night who he follows the news, 0:14:18.040 --> 0:14:20.040 but he's not in financial news or anything, and he 0:14:20.200 --> 0:14:21.600 picks up his phone. He's like, have you seen this 0:14:21.680 --> 0:14:24.040 video from j Powell? I was like, why do you 0:14:24.080 --> 0:14:26.840 care about Jay Powell? And that's how big of a 0:14:26.880 --> 0:14:28.440 deal it was over the weekend. 0:14:28.280 --> 0:14:31.600 And so to me, that's why, in some ways I 0:14:31.600 --> 0:14:34.760 think Harvey Schwartz is probably right. The idea of fetting 0:14:34.760 --> 0:14:39.200 dependence may have actually become more important and potentially even stronger, 0:14:39.680 --> 0:14:40.760 at least in the short term. 0:14:40.880 --> 0:14:42.840 Hey, I want to ask you about the process. I 0:14:42.840 --> 0:14:47.320 remember reading Too Big Defail, loved it and reported through 0:14:47.360 --> 0:14:50.200 it and was able to I think, like you talk 0:14:50.280 --> 0:14:51.960 to some of the people who were in the room 0:14:52.000 --> 0:14:53.800 when it all happened. I remember driving to John mack 0:14:54.520 --> 0:14:56.800 on a panel of course, formerly a Morgan Stanley and 0:14:56.880 --> 0:15:00.880 getting that actual physical tech from Mitsubishi. It felt like 0:15:02.040 --> 0:15:04.120 it felt like, excuse me, you were in the room 0:15:04.200 --> 0:15:06.240 like the way I read it, So to tell me 0:15:06.280 --> 0:15:07.120 how you did that? 0:15:07.440 --> 0:15:09.840 So unform what was the box of things that you've got? 0:15:09.880 --> 0:15:11.800 You're like, oh my gosh, so unfortunately all of these 0:15:11.840 --> 0:15:12.760 people were not allIt. 0:15:13.000 --> 0:15:13.320 No. 0:15:14.840 --> 0:15:17.640 What and you really I spent about eight years, really, 0:15:18.680 --> 0:15:22.960 you know, just combing through boxes and boxes and materials, 0:15:23.040 --> 0:15:26.120 some at libraries, some from families that were involved in 0:15:26.160 --> 0:15:30.560 this universities. I was able to convince, after a lot 0:15:30.560 --> 0:15:35.120 of knocking on doors, the Federal Reserve in New York 0:15:35.480 --> 0:15:37.760 to give me access to the board minutes. That was 0:15:37.800 --> 0:15:39.760 something that they haven't given out over the past one 0:15:39.800 --> 0:15:41.960 hundred years. They, by the way, interesting on their website 0:15:41.960 --> 0:15:44.880 today you can get you know, last month's board minutes. 0:15:44.920 --> 0:15:47.520 You still can't get the nineteen twenty nine board minutes. 0:15:47.560 --> 0:15:49.920 But that sort of became a treasure map for me. 0:15:50.000 --> 0:15:52.000 But a lot you know, when you see two people 0:15:52.000 --> 0:15:55.120 talking to each other in a room, what's oftentimes happening 0:15:55.240 --> 0:15:59.080 is I'm finding a series of depositions. For example, where 0:15:59.160 --> 0:16:01.120 Charlie Mitchell, who's the main character of the book, ran 0:16:01.280 --> 0:16:04.360 National City, which become a city group. You know, he 0:16:04.400 --> 0:16:06.720 would be interviewed in the deposition or in a civil case. 0:16:06.760 --> 0:16:09.480 There were also criminal cases where they would ask him, 0:16:09.560 --> 0:16:11.720 you know, where were you when X happy He said, well, 0:16:11.720 --> 0:16:13.120 I was walking down the street and I got to 0:16:13.160 --> 0:16:15.200 sixty fifth Street, and what did you say to so 0:16:15.280 --> 0:16:17.120 and so, and I said such and such, And then 0:16:17.160 --> 0:16:20.040 they would interview his colleague and they'd say, well, you 0:16:20.080 --> 0:16:21.640 were standing on the corner, what did you say to it? 0:16:21.640 --> 0:16:23.280 And he would say, this is what I said. And 0:16:23.280 --> 0:16:26.320 then they'd interview his wife and so when you though 0:16:26.360 --> 0:16:28.880 all of those quotes are real. And then oftentimes I 0:16:28.920 --> 0:16:31.840 would go and try to find the architecture plans or 0:16:31.960 --> 0:16:34.760 a photograph of the room so I could really try 0:16:34.800 --> 0:16:36.560 to put you in it, and I try to understand 0:16:36.560 --> 0:16:38.120 what the weather was that day and what you know, 0:16:38.120 --> 0:16:40.480 whether it was light out or not, all of these 0:16:40.520 --> 0:16:44.000 sort of little things so that again, if you're trying 0:16:44.040 --> 0:16:46.720 to as a narrator narrator, you can sort of feel 0:16:46.760 --> 0:16:47.200 like you're. 0:16:47.080 --> 0:16:47.720 There, right. 0:16:48.160 --> 0:16:49.720 Was there a time when you were, you know, in 0:16:49.800 --> 0:16:52.000 some sort of archive over the last ten years doing 0:16:52.040 --> 0:16:55.320 this where you got this sort of treasure trove of 0:16:55.400 --> 0:16:58.160 correspondence between two people and you were like, Okay, this 0:16:58.400 --> 0:17:01.360 is what I need, this is the ticket. It's just 0:17:01.360 --> 0:17:02.720 going to illuminate. 0:17:02.240 --> 0:17:03.560 You know what it was? One of it was like 0:17:04.040 --> 0:17:05.719 or is it just so peaceful? No, it was like 0:17:06.080 --> 0:17:10.359 it would either be raining, like you're in the rainforest 0:17:10.359 --> 0:17:13.040 and it was fabulous, or just like the desert for nods, 0:17:13.280 --> 0:17:15.600 and you'd know because you'd go to these places looking 0:17:15.600 --> 0:17:17.800 for stuff and then you'd go through all these boxes 0:17:17.800 --> 0:17:20.320 and there'd be nothing, and then you'd be so depressed, 0:17:20.359 --> 0:17:22.440 and then magically something would happen. I mean there, I 0:17:22.480 --> 0:17:24.720 will say there was one moment for me still that 0:17:24.760 --> 0:17:28.359 I think was just like a true aha, which is 0:17:28.720 --> 0:17:30.479 one of the main characters of the book is Carter Glass, 0:17:30.480 --> 0:17:32.359 of course, is the Glass to Eagle. He was a 0:17:32.480 --> 0:17:35.600 senator in Virginia, and I think I had an impression 0:17:35.640 --> 0:17:39.280 going in. You know today, it's off that bill is 0:17:39.320 --> 0:17:41.840 often held up by Elizabeth Warren other people as this 0:17:42.000 --> 0:17:45.960 sort of pure effort to really break up the banks 0:17:46.520 --> 0:17:50.320 for all the right reasons, and I found a trove 0:17:50.520 --> 0:17:54.720 of correspondence that showed, I think, maybe for the first time, 0:17:55.640 --> 0:17:59.399 that in fact, parts of that bill were actually written 0:17:59.480 --> 0:18:04.920 by a out their banker trying frankly to screw over 0:18:05.040 --> 0:18:07.760 JP Morgan. And you think to yourself about, you know, 0:18:07.800 --> 0:18:10.000 money in Washington and lobbying, and I thought, oh, the 0:18:10.000 --> 0:18:12.360 good old days, they didn't do things like that. And 0:18:12.440 --> 0:18:13.679 it's no different. 0:18:14.040 --> 0:18:15.920 Yeah, exactly what I. 0:18:15.880 --> 0:18:17.840 Want to talk about Evangeline Adams. 0:18:17.800 --> 0:18:20.480 Ie the Evangeline, the. 0:18:20.480 --> 0:18:23.040 Character that everybody wants to talk about. Well, we should 0:18:23.040 --> 0:18:23.960 explain who she has for people. 0:18:24.000 --> 0:18:28.480 Ev Angeline Adams is an astrologer. She had an office 0:18:28.560 --> 0:18:31.639 up at Carnegie Hall on fifty seventh Street, and every 0:18:31.680 --> 0:18:34.560 banker in town would go visit with her. She had 0:18:34.600 --> 0:18:37.000 a newsletter. I mean, I like to think deal book 0:18:37.040 --> 0:18:40.560