1 00:00:03,400 --> 00:00:07,200 Speaker 1: This is a Bloomberg Radio special, Black America Confronts a 2 00:00:07,200 --> 00:00:11,200 Speaker 1: Credit crunch Shanali bask Though many Black Americans have been 3 00:00:11,200 --> 00:00:14,800 Speaker 1: celebrating Juneteenth for years, it's only been two since the 4 00:00:14,920 --> 00:00:18,919 Speaker 1: US finally declared it a federal holiday. While President Abraham 5 00:00:19,000 --> 00:00:23,239 Speaker 1: Lincoln's Emancipation Proclamation officially freed slaves in eighteen sixty three, 6 00:00:23,800 --> 00:00:26,960 Speaker 1: many areas in the South didn't follow through for some time. 7 00:00:27,640 --> 00:00:31,520 Speaker 1: It was on June teenth, June nineteenth, eighteen sixty five 8 00:00:31,840 --> 00:00:35,280 Speaker 1: that Galveston, Texas released the very last enslaved people in 9 00:00:35,320 --> 00:00:38,560 Speaker 1: the country. But the day comes with the stark recognition, 10 00:00:39,200 --> 00:00:42,120 Speaker 1: as far as we've come since slavery, we still have 11 00:00:42,280 --> 00:00:44,920 Speaker 1: a ways to go for racial equity in the country 12 00:00:44,960 --> 00:00:48,920 Speaker 1: for Black Americans, particularly when it comes to wealth. A 13 00:00:48,960 --> 00:00:52,519 Speaker 1: Brookings Institute report shows that in twenty nineteen, the median 14 00:00:52,640 --> 00:00:55,480 Speaker 1: net worth of a typical white household was nearly eight 15 00:00:55,560 --> 00:00:58,840 Speaker 1: times higher than that of a typical black household. One 16 00:00:58,920 --> 00:01:02,640 Speaker 1: key factor drive the disparity is access to credit. Everything 17 00:01:02,640 --> 00:01:05,679 Speaker 1: from business loans to securing a mortgage remains a challenge 18 00:01:05,680 --> 00:01:08,600 Speaker 1: for many black families. A Saint Louis FED report from 19 00:01:08,640 --> 00:01:11,880 Speaker 1: that same year found that Black businesses were denied loans 20 00:01:11,880 --> 00:01:15,039 Speaker 1: at much higher rates than their white counterparts, and today's 21 00:01:15,040 --> 00:01:19,560 Speaker 1: economic landscape is no friendlier to Black Americans as recession 22 00:01:19,560 --> 00:01:23,119 Speaker 1: fears and recent banking turmoil loom large. Over the next hour, 23 00:01:23,200 --> 00:01:26,080 Speaker 1: we'll take a closer look at the challenges black communities 24 00:01:26,080 --> 00:01:28,440 Speaker 1: are facing as we see a broader pullback and lending. 25 00:01:28,640 --> 00:01:31,679 Speaker 1: We're joined now by Cynthia Day, She's the president and 26 00:01:31,800 --> 00:01:35,200 Speaker 1: CEO of Citizens Trust Bank, one of the very limited 27 00:01:35,240 --> 00:01:38,160 Speaker 1: number of black owned banks in the country, and Harold Butler, 28 00:01:38,240 --> 00:01:41,240 Speaker 1: who leads the Diverse Financial Institutions Group at Wall Street 29 00:01:41,319 --> 00:01:44,720 Speaker 1: Giant City Group. Cynthia, let's start with you, what does 30 00:01:44,800 --> 00:01:46,040 Speaker 1: Juneteenth mean to you? 31 00:01:46,400 --> 00:01:48,760 Speaker 2: I first have to acknowledge the fact that we're talking 32 00:01:48,760 --> 00:01:52,120 Speaker 2: about Juneteenth, when a couple of years ago there were 33 00:01:52,160 --> 00:01:54,320 Speaker 2: millions of people in our country that didn't even know 34 00:01:54,400 --> 00:01:58,400 Speaker 2: June tenth existed. So today it's becoming the national conversation 35 00:01:59,000 --> 00:02:02,240 Speaker 2: and the recognition of the significance of Juneteenth, I think, 36 00:02:02,640 --> 00:02:05,760 Speaker 2: in itself is progress for me personally. When I think 37 00:02:05,800 --> 00:02:09,240 Speaker 2: of Juneteenth, I think of a time to reflect and 38 00:02:09,360 --> 00:02:14,400 Speaker 2: celebrate the American African American spirit, its resilient and the 39 00:02:14,560 --> 00:02:18,000 Speaker 2: unsung contributions that have been made to the American society. 40 00:02:18,360 --> 00:02:22,160 Speaker 2: It's also a time to look forward and recognize the 41 00:02:22,280 --> 00:02:26,679 Speaker 2: deep impact and the cost of this, you know, his 42 00:02:26,760 --> 00:02:30,280 Speaker 2: these historical events to the Black community and it She 43 00:02:30,400 --> 00:02:35,320 Speaker 2: continuously reminded us to continue to press forward and to 44 00:02:35,480 --> 00:02:39,480 Speaker 2: press for economic parity and financial well being in an 45 00:02:39,520 --> 00:02:40,800 Speaker 2: African American community. 46 00:02:41,000 --> 00:02:45,560 Speaker 1: As we set up the conversation about parity here, maybe Cynthia, 47 00:02:45,639 --> 00:02:47,919 Speaker 1: you can kind of describe the role of black owned 48 00:02:47,919 --> 00:02:49,120 Speaker 1: banks and black communities. 49 00:02:49,480 --> 00:02:52,320 Speaker 2: Our bank has been around for, you know, over one 50 00:02:52,400 --> 00:02:56,560 Speaker 2: hundred years. Our founding mission was to create parity. And 51 00:02:56,600 --> 00:02:59,800 Speaker 2: the fact that our institutions are here, I think we've 52 00:03:00,080 --> 00:03:03,480 Speaker 2: we've seen this tom and tom during the Great Recession 53 00:03:03,560 --> 00:03:07,679 Speaker 2: and the pandemic, where we get into credit constrained areas 54 00:03:07,760 --> 00:03:10,760 Speaker 2: and there's no access or people that understand the plight 55 00:03:10,840 --> 00:03:14,280 Speaker 2: of these communities and what are as willing to extend 56 00:03:14,320 --> 00:03:16,639 Speaker 2: credit for good reasons. 57 00:03:16,160 --> 00:03:17,639 Speaker 3: In economic downcycles. 58 00:03:18,040 --> 00:03:21,000 Speaker 2: But it takes a bank or an African American business 59 00:03:21,000 --> 00:03:24,200 Speaker 2: that are that are in and of those communities. We 60 00:03:24,240 --> 00:03:27,200 Speaker 2: saw this during the during the Great Recession, we saw 61 00:03:27,200 --> 00:03:30,800 Speaker 2: it during the pandemic, whether it was through PPP or 62 00:03:30,880 --> 00:03:31,880 Speaker 2: traditional credit. 63 00:03:32,480 --> 00:03:33,040 Speaker 3: We were there. 64 00:03:33,160 --> 00:03:36,160 Speaker 2: We saved businesses, we saved jobs, we saved home we 65 00:03:36,240 --> 00:03:38,720 Speaker 2: save families, We saved communities. 66 00:03:39,120 --> 00:03:41,640 Speaker 1: Now, Harold over at City Group, you're really spearheaded the 67 00:03:41,640 --> 00:03:45,720 Speaker 1: program to work with minority depositary institutions. And that signals 68 00:03:45,760 --> 00:03:49,440 Speaker 1: to me that you saw early on the ripple effects 69 00:03:49,600 --> 00:03:52,280 Speaker 1: from big bank to medium sized bank to smaller bank 70 00:03:52,400 --> 00:03:57,680 Speaker 1: across communities on the flow of capital. You know, why 71 00:03:57,680 --> 00:03:59,880 Speaker 1: did you start this program? And you know where does 72 00:03:59,880 --> 00:04:02,600 Speaker 1: the stand today? And what concerns do you have given 73 00:04:02,600 --> 00:04:04,760 Speaker 1: that there are concerns about a credit crunch. 74 00:04:04,920 --> 00:04:08,120 Speaker 4: You know, we began this journey, you know, much before 75 00:04:08,760 --> 00:04:12,480 Speaker 4: you know the world had its crises or took part 76 00:04:12,920 --> 00:04:17,880 Speaker 4: and witness the murder of George Floyd. And you know, 77 00:04:17,960 --> 00:04:20,400 Speaker 4: for us as a firm post that, it was really 78 00:04:20,480 --> 00:04:24,760 Speaker 4: about determining what could we do to help make things better? 79 00:04:25,000 --> 00:04:25,120 Speaker 3: Right? 80 00:04:25,240 --> 00:04:30,600 Speaker 4: What role could city play at helping to achieve parody 81 00:04:30,640 --> 00:04:34,039 Speaker 4: as we just talked about reducing the racial wealth gap, 82 00:04:34,640 --> 00:04:38,280 Speaker 4: things of that nature. When you look at communities that 83 00:04:38,320 --> 00:04:42,000 Speaker 4: are underinvested and underrepresented, they all have a common theme 84 00:04:42,080 --> 00:04:47,520 Speaker 4: and that common theme is the lack of banking infrastructure. 85 00:04:47,040 --> 00:04:50,000 Speaker 1: And they what about this moment in time. What does 86 00:04:50,040 --> 00:04:51,720 Speaker 1: it feel like to run a bank today? 87 00:04:52,360 --> 00:04:56,280 Speaker 2: Like many economic cycles that we've gone through, it just 88 00:04:56,320 --> 00:04:59,280 Speaker 2: requires a lot of resilience. It could be very difficult. 89 00:04:59,600 --> 00:05:02,800 Speaker 2: We have to make sure that we are strong and 90 00:05:03,400 --> 00:05:06,560 Speaker 2: well managed and well focused and well capitalized so we 91 00:05:06,680 --> 00:05:10,120 Speaker 2: can help our customers. They needed us, They needed us 92 00:05:10,200 --> 00:05:13,960 Speaker 2: during PPP, they needed us during the Great Recession. 93 00:05:14,560 --> 00:05:15,360 Speaker 3: They need us. 94 00:05:15,480 --> 00:05:20,680 Speaker 2: I think partnerships with people like City and other corporations. 95 00:05:20,839 --> 00:05:25,000 Speaker 2: I think that united in collaborative front can help us 96 00:05:25,040 --> 00:05:28,800 Speaker 2: create greater impact. It can help us close these wealth gaps. 97 00:05:29,080 --> 00:05:32,000 Speaker 2: It can help us increase home ownership. It could help 98 00:05:32,080 --> 00:05:36,679 Speaker 2: us create healthy ecosystem within the communities that we serve. 99 00:05:36,720 --> 00:05:38,719 Speaker 2: And I think it will be beneficial to our country 100 00:05:38,839 --> 00:05:41,640 Speaker 2: because I think if we take this fourteen percent of 101 00:05:41,640 --> 00:05:45,680 Speaker 2: this population, it can increase GDP. So I think this 102 00:05:45,760 --> 00:05:49,720 Speaker 2: is not just a minority bank. It's not an underrepresented 103 00:05:49,960 --> 00:05:55,560 Speaker 2: or under invested community. This is a national issue. 104 00:05:55,760 --> 00:05:59,280 Speaker 1: Speaking of challenges, I think one major concern is a 105 00:05:59,320 --> 00:06:02,560 Speaker 1: recession and what a recession would mean, what doesn't mean 106 00:06:02,640 --> 00:06:06,000 Speaker 1: for all small business owners, let alone black small business owners, 107 00:06:06,040 --> 00:06:10,039 Speaker 1: let alone black female small business owners. Another question that 108 00:06:10,120 --> 00:06:13,600 Speaker 1: is Embedded in that too, is this decade's long disparity, 109 00:06:13,640 --> 00:06:16,760 Speaker 1: this widening gap between the wealth of Black Americans and 110 00:06:16,760 --> 00:06:19,320 Speaker 1: white Americans that has just expanded over time, and what 111 00:06:19,400 --> 00:06:23,240 Speaker 1: a recession would mean for that. Does it create setbacks? 112 00:06:23,839 --> 00:06:27,039 Speaker 1: What do you tell business owners communities that might be 113 00:06:27,080 --> 00:06:30,560 Speaker 1: worried that some of the progress might be challenged in 114 00:06:30,600 --> 00:06:31,560 Speaker 1: the next year or so. 115 00:06:31,839 --> 00:06:35,040 Speaker 2: You know, we just keep the conversation open with our customers. 116 00:06:35,400 --> 00:06:37,960 Speaker 2: We are consistently talking to them. We had to talk 117 00:06:38,000 --> 00:06:41,800 Speaker 2: to them during this recent bank failures. We have to 118 00:06:41,880 --> 00:06:46,920 Speaker 2: keep reassuring them that you know, we're here, We're with them, 119 00:06:47,200 --> 00:06:50,760 Speaker 2: we are feeling some of the same impact and effects. 120 00:06:51,160 --> 00:06:52,840 Speaker 3: We've been doing this for one hundred years. 121 00:06:52,880 --> 00:06:58,880 Speaker 2: I keep repeating that we understand these different cycles that 122 00:06:58,920 --> 00:07:02,720 Speaker 2: we go through. It does continue to take that conversation 123 00:07:03,080 --> 00:07:06,120 Speaker 2: making sure we're there during those recessionary times. 124 00:07:06,160 --> 00:07:07,680 Speaker 3: And I know that all of us. 125 00:07:07,600 --> 00:07:12,040 Speaker 2: Are aware of that that during recessions, historically, African American 126 00:07:12,080 --> 00:07:15,920 Speaker 2: communities have a deeper and more severe impact with higher 127 00:07:16,040 --> 00:07:21,360 Speaker 2: business closures, higher job loss, hire unemployment, steep losses and 128 00:07:21,440 --> 00:07:25,480 Speaker 2: home values and more importantly, you. 129 00:07:25,440 --> 00:07:28,160 Speaker 3: Know the lag in the recovery. 130 00:07:28,680 --> 00:07:32,960 Speaker 2: We saw the same issues and trends during the pandemic 131 00:07:33,600 --> 00:07:37,080 Speaker 2: with you know, people of color seeing disproportionately higher job 132 00:07:37,120 --> 00:07:41,000 Speaker 2: and wage loss. So it's hard to provide that comfort. 133 00:07:41,360 --> 00:07:44,240 Speaker 2: But what we can say is, you know we were 134 00:07:44,320 --> 00:07:46,120 Speaker 2: here with you during these times. 135 00:07:46,880 --> 00:07:48,200 Speaker 3: We don't have a crystal ball. 136 00:07:48,440 --> 00:07:51,320 Speaker 2: We don't know where all this is going, but we 137 00:07:51,360 --> 00:07:54,320 Speaker 2: do know one thing. We're still committed. We were here 138 00:07:54,440 --> 00:07:57,840 Speaker 2: to help with those providing access to capital for businesses 139 00:07:57,880 --> 00:08:01,760 Speaker 2: during those times. But we do know we've been through 140 00:08:01,760 --> 00:08:06,240 Speaker 2: this before. We're resilient, Our customers are resilient, and we're 141 00:08:06,240 --> 00:08:08,880 Speaker 2: going to be there to help them through this time. 142 00:08:09,080 --> 00:08:11,800 Speaker 1: Harold the question for you, and i'd like Cynthia away 143 00:08:11,800 --> 00:08:13,400 Speaker 1: on on this too. I know over at to the group, 144 00:08:13,440 --> 00:08:15,040 Speaker 1: we've done a lot of work with the US government, 145 00:08:15,560 --> 00:08:17,880 Speaker 1: and if you think about the role the government plays 146 00:08:17,920 --> 00:08:21,360 Speaker 1: both in supporting large banks, let alone black owned banks, 147 00:08:21,760 --> 00:08:24,840 Speaker 1: medium and small size banks, if you think about kind 148 00:08:24,840 --> 00:08:27,240 Speaker 1: of the work they've done to kind of foster the 149 00:08:27,280 --> 00:08:30,760 Speaker 1: growth of minority depository institutions, where we know that the 150 00:08:30,840 --> 00:08:34,040 Speaker 1: number has shrink over a wide number of years. What 151 00:08:34,160 --> 00:08:36,920 Speaker 1: can they and should be they do? What can they 152 00:08:36,960 --> 00:08:38,199 Speaker 1: and should they be doing? 153 00:08:38,559 --> 00:08:40,560 Speaker 4: You know, I think it's important for our government to 154 00:08:40,600 --> 00:08:46,800 Speaker 4: continue to focus as they are right on creating programs, 155 00:08:46,920 --> 00:08:51,520 Speaker 4: doing things that can uplift and support the need to 156 00:08:51,640 --> 00:08:56,560 Speaker 4: change the narrative broadly. They're not easy, and I don't 157 00:08:56,559 --> 00:09:01,120 Speaker 4: think anybody is under a delusion that it would be easy. 158 00:09:01,200 --> 00:09:05,360 Speaker 4: These are tough things to sometimes, you know, have conversations about. 159 00:09:05,360 --> 00:09:08,040 Speaker 4: But the important thing is that the government continues to 160 00:09:08,080 --> 00:09:10,960 Speaker 4: do what it does and to lead these conversations to 161 00:09:11,000 --> 00:09:14,240 Speaker 4: be a part of solutioning things that make sense for 162 00:09:14,320 --> 00:09:17,040 Speaker 4: the space, because then I think we get to a 163 00:09:17,040 --> 00:09:17,640 Speaker 4: better place. 164 00:09:17,960 --> 00:09:21,240 Speaker 2: I agree with what Harold has laid out there, and 165 00:09:21,320 --> 00:09:24,920 Speaker 2: I will say during the pandemic and during the bake failures, 166 00:09:24,960 --> 00:09:29,880 Speaker 2: I think that the swiftness with which the government moved 167 00:09:29,960 --> 00:09:32,240 Speaker 2: and some of the programs they put in place was 168 00:09:32,640 --> 00:09:35,920 Speaker 2: very helpful and it really stopped us short of a 169 00:09:36,080 --> 00:09:40,959 Speaker 2: catastrophic events more catastrophic than what we had during the pandemic. 170 00:09:41,520 --> 00:09:42,920 Speaker 3: One of the number one things on my. 171 00:09:42,960 --> 00:09:46,840 Speaker 2: List that I think would be helpful is to let 172 00:09:47,400 --> 00:09:53,040 Speaker 2: like things and like businesses participate in a meaningful and meaningful. 173 00:09:52,600 --> 00:09:55,000 Speaker 3: Way as vendor suppliers. 174 00:09:55,559 --> 00:09:59,800 Speaker 2: There are trillions of dollars that flow within the governmental enterprises, 175 00:10:00,160 --> 00:10:04,079 Speaker 2: and I think the supplier should reflect the diverse tapestry 176 00:10:04,080 --> 00:10:04,959 Speaker 2: of the people they serve. 177 00:10:05,640 --> 00:10:08,200 Speaker 3: And there are effective ways in which to accomplish this. 178 00:10:08,360 --> 00:10:13,240 Speaker 2: I mean, we can encourage partnerships between minority suppliers, banks 179 00:10:13,640 --> 00:10:15,320 Speaker 2: and other corporations like City. 180 00:10:16,240 --> 00:10:18,240 Speaker 3: This can be effective, it can be efficient. 181 00:10:18,880 --> 00:10:22,720 Speaker 2: Yet it provides for opportunities to grow minority businesses, to 182 00:10:22,800 --> 00:10:26,360 Speaker 2: create jobs. It will increase home ownership, you can build 183 00:10:26,440 --> 00:10:30,760 Speaker 2: generational wealth. It's something that we should be doing and 184 00:10:30,840 --> 00:10:33,600 Speaker 2: something I think that we should be committed to make 185 00:10:33,640 --> 00:10:34,120 Speaker 2: it happen. 186 00:10:34,480 --> 00:10:37,960 Speaker 1: Special thanks to Cynthia Day, president and CEO of Citizens 187 00:10:38,000 --> 00:10:40,440 Speaker 1: Treuss Bank, and Harold Butler, the head of the Diverse 188 00:10:40,480 --> 00:10:44,840 Speaker 1: Financial Institutions Group at Citygroup, for joining us. Ryan Williams 189 00:10:44,880 --> 00:10:47,400 Speaker 1: founded Cadre in twenty fourteen as a way for more 190 00:10:47,440 --> 00:10:50,760 Speaker 1: investors to get access to commercial real estate markets. He 191 00:10:50,800 --> 00:10:53,680 Speaker 1: grew up in Baton Rouge, Louisiana, and started investing in 192 00:10:53,720 --> 00:10:56,320 Speaker 1: real estate while he went to college at Harvard University. 193 00:10:56,920 --> 00:10:59,080 Speaker 1: When he was in his twenties, he went to almost 194 00:10:59,160 --> 00:11:01,360 Speaker 1: a dozen banks for loans for investing in that real 195 00:11:01,480 --> 00:11:05,040 Speaker 1: estate and was turned away by many. The bank willing 196 00:11:05,040 --> 00:11:07,839 Speaker 1: to give him a loan Citizens Trust Bank that was 197 00:11:07,880 --> 00:11:10,800 Speaker 1: a firm run by our last guest, Cynthia Day. For 198 00:11:10,920 --> 00:11:14,040 Speaker 1: Ryan Williams, his relationship with citizens Trust Banks set him 199 00:11:14,080 --> 00:11:17,400 Speaker 1: on a path to eventually starting Cadre. Ryan, talk to 200 00:11:17,520 --> 00:11:20,720 Speaker 1: us about how you're thinking about this June teenth June team. 201 00:11:20,800 --> 00:11:24,560 Speaker 5: To me, it's really a symbol freedom. You know, it's 202 00:11:24,559 --> 00:11:27,439 Speaker 5: the commemoration of the end of slavery in the US. 203 00:11:27,760 --> 00:11:30,360 Speaker 5: It's deeply personal to me because I have family members 204 00:11:30,360 --> 00:11:34,440 Speaker 5: who were enslaved in Texas, and it's a reminder of 205 00:11:34,600 --> 00:11:39,360 Speaker 5: the fact that there's still far too many Americans, especially 206 00:11:39,400 --> 00:11:43,640 Speaker 5: Black Americans, that are fighting for economic freedom and opportunity 207 00:11:44,080 --> 00:11:46,959 Speaker 5: and social freedom and opportunity. For me, it's really about 208 00:11:47,000 --> 00:11:51,040 Speaker 5: how can I use my platform, my network to create 209 00:11:51,080 --> 00:11:56,160 Speaker 5: greater financial opportunity, whether that's democratizing access to alternatives like 210 00:11:56,160 --> 00:11:59,600 Speaker 5: we're doing at Cadre, or whether it's helping advocate for 211 00:12:00,360 --> 00:12:03,679 Speaker 5: both private and public action to close the racial wealth gap. 212 00:12:03,800 --> 00:12:06,720 Speaker 1: When you think about kind of getting through this credit 213 00:12:06,760 --> 00:12:10,040 Speaker 1: crunch and the fact that people are worried about small 214 00:12:10,080 --> 00:12:13,240 Speaker 1: banks in general, but the black owned banks in America 215 00:12:13,320 --> 00:12:16,600 Speaker 1: have been under pressure for decades. How do black owned 216 00:12:16,600 --> 00:12:19,280 Speaker 1: banks and black communities that rely on black owned banks 217 00:12:19,559 --> 00:12:21,520 Speaker 1: really see through this credit crunch. 218 00:12:21,760 --> 00:12:24,280 Speaker 5: Yes, I mean, I believe it's a combination of public 219 00:12:24,320 --> 00:12:25,760 Speaker 5: and private partnership. 220 00:12:25,920 --> 00:12:26,080 Speaker 6: You know. 221 00:12:26,120 --> 00:12:29,240 Speaker 5: I believe that there needs to be proactive action taken 222 00:12:29,480 --> 00:12:34,440 Speaker 5: by the government, whether that's helping incentivize private investment into 223 00:12:34,480 --> 00:12:37,360 Speaker 5: many of the banks to help further capitalize these banks 224 00:12:37,400 --> 00:12:40,679 Speaker 5: to ensure that they can continue to lend to their communities, 225 00:12:41,679 --> 00:12:47,520 Speaker 5: or whether that's entrepreneurs and companies taking action to intentionally 226 00:12:47,559 --> 00:12:49,880 Speaker 5: funnel capital to many of these banks that have been 227 00:12:49,920 --> 00:12:53,160 Speaker 5: the bedrock for their community. It's ultimately about the flow 228 00:12:53,160 --> 00:12:57,520 Speaker 5: of capital, and it's ultimately about incentivizing those in the 229 00:12:57,520 --> 00:13:00,840 Speaker 5: private sector and those in the public sector to do 230 00:13:00,920 --> 00:13:05,600 Speaker 5: more to accelerate that flow of capital into these banks 231 00:13:05,600 --> 00:13:06,239 Speaker 5: and communities. 232 00:13:06,360 --> 00:13:08,959 Speaker 1: Maybe talk a little bit about what those solutions could 233 00:13:09,000 --> 00:13:11,800 Speaker 1: look like, because you're one of the people that has 234 00:13:11,840 --> 00:13:14,800 Speaker 1: worked with other entrepreneurs and that has worked with large 235 00:13:14,840 --> 00:13:17,560 Speaker 1: financial institutions to get the ball rolling. 236 00:13:17,960 --> 00:13:22,840 Speaker 5: One of the most encouraging solutions that I've seen was 237 00:13:23,679 --> 00:13:27,920 Speaker 5: the way JP Morgan stepped up to help infuse capital 238 00:13:27,960 --> 00:13:32,440 Speaker 5: and to challenge banks over the past really three to 239 00:13:32,520 --> 00:13:36,600 Speaker 5: four months and created effectively a syndicate. Now, it didn't 240 00:13:36,679 --> 00:13:41,680 Speaker 5: ultimately have the result of stabilizing First Republic in this case, 241 00:13:42,320 --> 00:13:46,800 Speaker 5: but it did show that this collective action when banks 242 00:13:46,880 --> 00:13:51,080 Speaker 5: come together or financial institutions come together to invest and 243 00:13:51,120 --> 00:13:55,400 Speaker 5: those that are struggling, can ultimately lead to a result 244 00:13:55,400 --> 00:13:56,719 Speaker 5: in more opportunity. 245 00:13:56,880 --> 00:13:58,960 Speaker 1: I'm glad you mentioned the biggest banks here too. I'm 246 00:13:59,000 --> 00:14:00,959 Speaker 1: glad you mentioned JP Moore again. We're also talking to 247 00:14:01,000 --> 00:14:04,120 Speaker 1: Goldman and City Group and different banks who are looking 248 00:14:04,160 --> 00:14:07,920 Speaker 1: to work to finance black entrepreneurs. Talk a little bit 249 00:14:07,960 --> 00:14:11,400 Speaker 1: more about the role of the financial system, especially because 250 00:14:12,120 --> 00:14:15,080 Speaker 1: in this year we're watching the biggest banks get bigger, 251 00:14:15,280 --> 00:14:18,160 Speaker 1: which means the eyes are really on them to make change. 252 00:14:18,280 --> 00:14:20,720 Speaker 5: It's right, Yeah, I mean, I think the divide and 253 00:14:20,760 --> 00:14:26,240 Speaker 5: delta between the haves and have nots is increasing faster 254 00:14:26,320 --> 00:14:29,120 Speaker 5: than it has in recent memory. One of the best 255 00:14:29,280 --> 00:14:33,760 Speaker 5: approaches here is the largest banks thinking about ways to 256 00:14:33,880 --> 00:14:39,960 Speaker 5: create syndicates, partnerships and investments that elevate banks that maybe 257 00:14:40,000 --> 00:14:43,360 Speaker 5: aren't directly competitive with them, but have specialized focused on 258 00:14:43,400 --> 00:14:46,240 Speaker 5: communities that they're not reaching or can't reach, or that 259 00:14:46,400 --> 00:14:50,640 Speaker 5: offers certain you know, loans to certain types of companies 260 00:14:50,720 --> 00:14:55,440 Speaker 5: rather that otherwise would not be capitalized. And so I 261 00:14:55,480 --> 00:14:58,600 Speaker 5: really think that American ingenuity. You know, some of the 262 00:14:58,720 --> 00:15:02,160 Speaker 5: unique elements of each region of our country are financed 263 00:15:02,160 --> 00:15:05,640 Speaker 5: by many of these regional community ranged banks, and without 264 00:15:05,960 --> 00:15:10,120 Speaker 5: government or larger bank action, I think you're bound to 265 00:15:10,120 --> 00:15:15,160 Speaker 5: see many ultimately fail or lose market position. 266 00:15:15,520 --> 00:15:19,040 Speaker 1: When you think about the involvement of larger banks into 267 00:15:19,480 --> 00:15:23,160 Speaker 1: the minority depositary institutions, black owned banks and black owned 268 00:15:23,200 --> 00:15:25,840 Speaker 1: businesses for that matter. With all the commitments that have 269 00:15:25,880 --> 00:15:27,800 Speaker 1: been made over the last couple of years, how do 270 00:15:27,840 --> 00:15:29,400 Speaker 1: you feel about the pace of progress? 271 00:15:29,440 --> 00:15:32,960 Speaker 5: Now, Yeah, it was it was incredibly encouraging to see, 272 00:15:33,400 --> 00:15:38,080 Speaker 5: you know, so many institutions and corporations discuss, you know, 273 00:15:38,120 --> 00:15:41,560 Speaker 5: how important they felt it was to ensure there's greater 274 00:15:41,600 --> 00:15:47,280 Speaker 5: economic justice and opportunity, you know, commit to various organizations 275 00:15:47,280 --> 00:15:52,000 Speaker 5: that are focused on creating more economic opportunity and access 276 00:15:53,080 --> 00:15:56,080 Speaker 5: by and larger I think it's been pretty discouraging and 277 00:15:56,160 --> 00:15:59,440 Speaker 5: disappointing that a lot of those commitments and a lot 278 00:15:59,480 --> 00:16:03,400 Speaker 5: of those statements have not been met with any kind 279 00:16:03,400 --> 00:16:06,920 Speaker 5: of accountability. There's been no progress report of note that 280 00:16:07,000 --> 00:16:09,720 Speaker 5: I see that analyze whether these commitments are being met, 281 00:16:10,200 --> 00:16:12,880 Speaker 5: and so I think this Juneteenth is actually an incredible 282 00:16:12,880 --> 00:16:17,280 Speaker 5: opportunity for many of these corporations to look inwards, to 283 00:16:17,360 --> 00:16:20,200 Speaker 5: hold themselves accountable for the commitments that they made in 284 00:16:20,240 --> 00:16:25,000 Speaker 5: the immediate aftermath of June teenth, and you know, to 285 00:16:25,000 --> 00:16:28,200 Speaker 5: also ensure that at a time when you know, things 286 00:16:28,320 --> 00:16:33,359 Speaker 5: like diversity or inclusion on a lot of different dimensions 287 00:16:33,400 --> 00:16:36,440 Speaker 5: can be overlooked for you know, solving the most pressing 288 00:16:36,520 --> 00:16:41,640 Speaker 5: business issues, that those commitments, you know, don't get completely 289 00:16:41,760 --> 00:16:42,240 Speaker 5: washed out. 290 00:16:42,600 --> 00:16:44,760 Speaker 1: Let's also talk about the fact that you're an entrepreneur. 291 00:16:44,840 --> 00:16:47,320 Speaker 1: You're an entrepreneur who look to black owned banks to 292 00:16:47,320 --> 00:16:50,200 Speaker 1: help get financing as you really got off the ground. 293 00:16:50,520 --> 00:16:53,120 Speaker 1: We've talked about this a couple of times before. Tell 294 00:16:53,200 --> 00:16:55,120 Speaker 1: us a little bit about the role they played and 295 00:16:55,400 --> 00:16:57,720 Speaker 1: why they were so important relative to the big banks. 296 00:16:58,120 --> 00:16:58,760 Speaker 3: Absolutely. 297 00:16:58,800 --> 00:17:02,200 Speaker 5: I mean it goes back to pattern matching and pattern 298 00:17:02,280 --> 00:17:05,200 Speaker 5: recognition number one, and then being nimble. I think those 299 00:17:05,200 --> 00:17:10,399 Speaker 5: are two unique attributes to community oriented banks and and 300 00:17:11,080 --> 00:17:15,800 Speaker 5: MDIs as well. They're more agile, they're able to move faster, 301 00:17:16,400 --> 00:17:19,480 Speaker 5: and then you know, they have a different quote unquote 302 00:17:19,560 --> 00:17:23,600 Speaker 5: risk box than many of the larger banks. They're able 303 00:17:23,640 --> 00:17:29,520 Speaker 5: to really understand the nuances behind why certain local businesses 304 00:17:29,600 --> 00:17:32,280 Speaker 5: may succeed in certain areas and why they may not. 305 00:17:32,760 --> 00:17:35,119 Speaker 5: And as a result, they're able to help propel and 306 00:17:35,200 --> 00:17:38,439 Speaker 5: prop up many local businesses that would not get the 307 00:17:38,480 --> 00:17:42,280 Speaker 5: time of day from larger banks. And so, you know, 308 00:17:42,359 --> 00:17:46,159 Speaker 5: for me personally, I was turned down by more than 309 00:17:46,200 --> 00:17:50,679 Speaker 5: ten banks, you know, to finance the acquisition of an 310 00:17:50,680 --> 00:17:55,280 Speaker 5: apartment complex in the Atlanta metro area. I had incredible 311 00:17:55,320 --> 00:17:58,720 Speaker 5: credit behind me. I had multiple ultra high net worth 312 00:17:58,760 --> 00:18:02,480 Speaker 5: investors were willing to behind the guarantee. But when I 313 00:18:02,520 --> 00:18:04,680 Speaker 5: spoke to some of the larger banks and they saw 314 00:18:04,720 --> 00:18:10,080 Speaker 5: that I was, you know, relatively young African American and 315 00:18:11,640 --> 00:18:15,000 Speaker 5: you know, relatively new in my career, I was shut 316 00:18:15,040 --> 00:18:17,240 Speaker 5: down for even had a chance to start to get along. 317 00:18:17,480 --> 00:18:20,080 Speaker 5: No One Bank, Citizens Trust Bank, who we actually work 318 00:18:20,160 --> 00:18:23,480 Speaker 5: with now today. Black Owned Bank started in the nineteen 319 00:18:23,520 --> 00:18:27,720 Speaker 5: twenties that focuses and serves Atlanta and other markets in 320 00:18:28,000 --> 00:18:31,520 Speaker 5: the Southeast. You know, they saw something different. They knew 321 00:18:31,960 --> 00:18:35,200 Speaker 5: you know, the region, the area that I was investing in. 322 00:18:35,600 --> 00:18:38,119 Speaker 5: They knew that there weren't a lot of people who 323 00:18:38,200 --> 00:18:40,960 Speaker 5: looked like me, who were buying apartment buildings in that area, 324 00:18:41,440 --> 00:18:45,000 Speaker 5: and they understood my business plan and that you know what, 325 00:18:45,080 --> 00:18:48,000 Speaker 5: We're going to give this young man the benefit of 326 00:18:48,000 --> 00:18:49,919 Speaker 5: the doubt. We're going to lend to him, We're going 327 00:18:50,000 --> 00:18:52,480 Speaker 5: to think about building a long term relationship with him. 328 00:18:52,800 --> 00:18:55,119 Speaker 5: We think that the way that he's investing in the 329 00:18:55,119 --> 00:18:58,600 Speaker 5: community will actually not just elevate his investors, but actually 330 00:18:58,600 --> 00:18:59,600 Speaker 5: the community itself. 331 00:19:00,080 --> 00:19:01,560 Speaker 3: And you know, we're going to. 332 00:19:01,480 --> 00:19:05,560 Speaker 5: Look at the opportunities versus the risks and lint as 333 00:19:05,560 --> 00:19:07,080 Speaker 5: a result. And if it weren't for that bank, I 334 00:19:07,119 --> 00:19:09,560 Speaker 5: probably would not be where I am today, you know, 335 00:19:09,640 --> 00:19:14,520 Speaker 5: the founder and CEO of Cadre, because that acquisition ultimately 336 00:19:14,600 --> 00:19:18,159 Speaker 5: ended up in generating significant returns for my investors, and 337 00:19:18,280 --> 00:19:20,280 Speaker 5: that put me on the path to saying, Okay, how 338 00:19:20,280 --> 00:19:23,760 Speaker 5: can I democratize access to this kind of institutional real 339 00:19:23,880 --> 00:19:27,399 Speaker 5: estate today because it created a track record for me. 340 00:19:27,600 --> 00:19:30,720 Speaker 1: Our thanks to Ryan Williams, founder and CEO of Cadre, 341 00:19:30,960 --> 00:19:34,000 Speaker 1: for joining us on today's program. You're listening to a 342 00:19:34,040 --> 00:19:38,720 Speaker 1: Bloomberg Radio special, Black America Confronts a Credit Crunch. I'm 343 00:19:38,760 --> 00:19:42,280 Speaker 1: Shanali Basik. Today we're looking at how black communities are 344 00:19:42,320 --> 00:19:45,840 Speaker 1: faring as economic uncertainty is leading banks to pull back 345 00:19:45,920 --> 00:19:49,560 Speaker 1: on lending. It's a situation that often has an outsized 346 00:19:49,600 --> 00:19:53,080 Speaker 1: impact on Black Americans. Asahi POMPEII is one of the 347 00:19:53,080 --> 00:19:56,040 Speaker 1: most senior black women on Wall Street. She's on the 348 00:19:56,080 --> 00:19:59,639 Speaker 1: management committee at Goldman Sachs and as head of Corporate Engagement. 349 00:20:00,200 --> 00:20:03,920 Speaker 1: She's also president of the Goldman Sachs Foundation. She leads 350 00:20:03,920 --> 00:20:07,800 Speaker 1: initiatives like ten Thousand Small Businesses, which supports smaller business 351 00:20:07,840 --> 00:20:12,080 Speaker 1: owners through education, finding fresh capital, and more. She also 352 00:20:12,160 --> 00:20:15,600 Speaker 1: helped Goldman launch one Million Black Women in twenty twenty one, 353 00:20:15,920 --> 00:20:19,080 Speaker 1: an initiative that pledges ten billion dollars in investments and 354 00:20:19,080 --> 00:20:22,600 Speaker 1: one hundred million dollars in philanthropic funds to address racial 355 00:20:22,600 --> 00:20:27,120 Speaker 1: and gender bias across businesses. Black executives from across the country, 356 00:20:27,160 --> 00:20:32,240 Speaker 1: including Walgrand CEO, Rosalind Brewer, and political powerhouses Valerie Jarrett 357 00:20:32,240 --> 00:20:36,000 Speaker 1: and Counduiz of Rice, are among the program's advisors. I 358 00:20:36,040 --> 00:20:37,640 Speaker 1: was wondering if you could start just kind of big 359 00:20:37,680 --> 00:20:40,679 Speaker 1: picture when you think about June teenth, you know, how 360 00:20:40,680 --> 00:20:43,399 Speaker 1: do you think about it from your stands at Goldman 361 00:20:43,520 --> 00:20:46,840 Speaker 1: Sachs and how do you talk to your colleagues about it. 362 00:20:48,320 --> 00:20:51,399 Speaker 6: You know, if we think about June Team, we really, 363 00:20:51,920 --> 00:20:55,280 Speaker 6: you know, think about how Black Americans are faring in 364 00:20:55,359 --> 00:20:59,480 Speaker 6: this country overall, from an economic perspective, what's happening on 365 00:20:59,560 --> 00:21:02,800 Speaker 6: the social front, and in particular, because we're an investment 366 00:21:02,840 --> 00:21:05,960 Speaker 6: bank for us, the focus is really on black small 367 00:21:06,000 --> 00:21:09,400 Speaker 6: businesses and how they're faring. I would describe this June 368 00:21:09,440 --> 00:21:12,880 Speaker 6: teint as a really jittery June teint for black small 369 00:21:12,920 --> 00:21:15,639 Speaker 6: businesses and small businesses of color. And that's as a 370 00:21:15,680 --> 00:21:18,240 Speaker 6: result of a number of factors that I am happy 371 00:21:18,240 --> 00:21:18,800 Speaker 6: to go into. 372 00:21:19,040 --> 00:21:21,840 Speaker 1: Yeah, let's get into that a little more deeply here. Obviously, 373 00:21:21,840 --> 00:21:24,199 Speaker 1: there are worries about a recession, but there's also worries 374 00:21:24,240 --> 00:21:27,160 Speaker 1: about what a credit crunch might be given so many 375 00:21:27,200 --> 00:21:31,399 Speaker 1: smaller banks have started to face so many troubles. What 376 00:21:31,720 --> 00:21:33,680 Speaker 1: are the biggest concerns you're seeing? 377 00:21:35,560 --> 00:21:38,080 Speaker 6: You know, we're seeing a number of sinctionally. You know, 378 00:21:38,160 --> 00:21:41,840 Speaker 6: on a good day, it's challenging for black businesses to 379 00:21:41,920 --> 00:21:45,520 Speaker 6: get funding, and this year that gets amplified, and so 380 00:21:45,880 --> 00:21:49,320 Speaker 6: they are really worried about the credit crunch. It's frustrating 381 00:21:49,840 --> 00:21:53,439 Speaker 6: their ability to be able to access access capital and 382 00:21:53,480 --> 00:21:57,480 Speaker 6: it's a very uncertain time for small business of color, 383 00:21:57,480 --> 00:22:01,560 Speaker 6: and in particular black small businesses since the done of 384 00:22:01,600 --> 00:22:05,359 Speaker 6: the pandemic. The last three years, Golden Taxes conducted over 385 00:22:05,560 --> 00:22:09,800 Speaker 6: seventeen surveys of small businesses to really keep a pulse 386 00:22:09,880 --> 00:22:13,480 Speaker 6: on what's happening. And here's what we're seeing. Dial back 387 00:22:13,560 --> 00:22:16,640 Speaker 6: a year ago, when we surveyed small businesses and said, 388 00:22:16,680 --> 00:22:19,600 Speaker 6: how do you feel about the economy more generally and 389 00:22:19,640 --> 00:22:23,479 Speaker 6: in particular your ability to access capital, We found that 390 00:22:23,520 --> 00:22:26,640 Speaker 6: seventy seven percent of them were confident in their ability 391 00:22:26,640 --> 00:22:32,040 Speaker 6: to access capital. Today, seventy seven percent of those businesses 392 00:22:32,320 --> 00:22:35,280 Speaker 6: are now concerned about their ability to access capital. So 393 00:22:35,320 --> 00:22:38,720 Speaker 6: they went from confident twelve months ago to concern right now. 394 00:22:39,080 --> 00:22:42,560 Speaker 6: And that's really manifested in terms of what they're experiencing. 395 00:22:42,920 --> 00:22:47,760 Speaker 6: They're experiencing a higher loan rejection, They're being asked for 396 00:22:47,880 --> 00:22:51,760 Speaker 6: more data than they were ever asked for before, more 397 00:22:51,800 --> 00:22:56,760 Speaker 6: scrutiny on their projection. Things are taking longer prolonged barring 398 00:22:57,800 --> 00:23:00,719 Speaker 6: approvals for their borrowing things that would take three months 399 00:23:01,200 --> 00:23:03,960 Speaker 6: now taking upwards of seven months to get approved. 400 00:23:04,640 --> 00:23:07,360 Speaker 1: So how much of this is because of the strains 401 00:23:07,400 --> 00:23:10,040 Speaker 1: that small banks are feeling in the United States, and 402 00:23:10,280 --> 00:23:13,919 Speaker 1: that extension to black owned banks, which are smaller than 403 00:23:13,960 --> 00:23:18,160 Speaker 1: America's top five for example, you. 404 00:23:18,240 --> 00:23:22,320 Speaker 6: Really put your finger on it. Small businesses rely on 405 00:23:22,440 --> 00:23:26,520 Speaker 6: small banks, and we know that. You know, they received 406 00:23:26,760 --> 00:23:30,240 Speaker 6: almost seventy percent of their commercial loans from banks with 407 00:23:30,359 --> 00:23:33,200 Speaker 6: less than two hundred and fifty billion in assets and 408 00:23:33,280 --> 00:23:36,720 Speaker 6: thirty percent from banks with less than ten billion in assets. 409 00:23:36,960 --> 00:23:41,280 Speaker 6: So when small banks have small have problems, small businesses 410 00:23:41,680 --> 00:23:46,159 Speaker 6: have problems as well. In particular, you know things like 411 00:23:46,320 --> 00:23:49,760 Speaker 6: you know your do you have a pre existing relationship 412 00:23:49,800 --> 00:23:54,520 Speaker 6: with the bank, what's your geographic proximity to the bank. 413 00:23:54,640 --> 00:23:57,760 Speaker 6: All of those are important factors as it relates to 414 00:23:57,880 --> 00:24:01,240 Speaker 6: a small business's ability to be able to access capital, 415 00:24:01,520 --> 00:24:04,800 Speaker 6: and all of that gets exacerbated when you think about 416 00:24:04,840 --> 00:24:07,000 Speaker 6: it for black small businesses. 417 00:24:07,080 --> 00:24:09,000 Speaker 1: And I want to be clear about this too, because 418 00:24:09,040 --> 00:24:11,159 Speaker 1: when we saw the bank failures in the United States, 419 00:24:11,200 --> 00:24:14,399 Speaker 1: it's not the black owned banks that necessarily faced the 420 00:24:14,440 --> 00:24:17,040 Speaker 1: same troubles. But with that said, you do have the 421 00:24:17,080 --> 00:24:20,800 Speaker 1: sense that financial conditions are tightening and credit is contracting. 422 00:24:21,240 --> 00:24:24,920 Speaker 1: What does that mean for black owned businesses in particular 423 00:24:25,000 --> 00:24:28,359 Speaker 1: black owned banks in this kind of a cycle. I 424 00:24:28,359 --> 00:24:33,000 Speaker 1: think there's a worry here that some of the disparities 425 00:24:33,000 --> 00:24:35,680 Speaker 1: that we have seen into the run up into the 426 00:24:35,720 --> 00:24:38,639 Speaker 1: runop into COVID, for example, might be exacerbated if we 427 00:24:38,640 --> 00:24:40,000 Speaker 1: were to face a recession ahead. 428 00:24:42,000 --> 00:24:44,280 Speaker 6: I would definitely agree with that. Look. I would say, 429 00:24:44,320 --> 00:24:48,000 Speaker 6: the same condition that can cause a small business to 430 00:24:48,040 --> 00:24:52,200 Speaker 6: shiver will cause a black small business to freeze because 431 00:24:52,200 --> 00:24:55,639 Speaker 6: they don't have the same safety net and frankly, the 432 00:24:55,720 --> 00:24:59,120 Speaker 6: same capital. And I'm talking about the social capital that 433 00:24:59,160 --> 00:25:01,920 Speaker 6: we know is a part of being able to access 434 00:25:02,240 --> 00:25:06,680 Speaker 6: actual capital for their business. We know that black small 435 00:25:06,720 --> 00:25:09,600 Speaker 6: businesses tend to are more likely to be denied for 436 00:25:09,640 --> 00:25:14,000 Speaker 6: a loan, they tend to get less favorable loan terms 437 00:25:14,400 --> 00:25:18,200 Speaker 6: even when controlling for credit worthiness, they tend to get 438 00:25:18,280 --> 00:25:22,760 Speaker 6: higher interest rates and stricter requirements. And so all of 439 00:25:22,800 --> 00:25:27,040 Speaker 6: those issues are creating significant concerns for what I'm calling 440 00:25:27,080 --> 00:25:29,359 Speaker 6: a jittery June teen for black small businesses. 441 00:25:29,600 --> 00:25:32,080 Speaker 1: But there's a reason also that you're leading this ten 442 00:25:32,119 --> 00:25:35,600 Speaker 1: thousand small businesses program as well as one million black women. 443 00:25:36,000 --> 00:25:37,800 Speaker 1: Where is the overlap. 444 00:25:38,560 --> 00:25:42,280 Speaker 6: As we think about closing the racial wealth gap. We 445 00:25:42,359 --> 00:25:45,760 Speaker 6: published a report called Black Women on Its and we 446 00:25:45,840 --> 00:25:49,879 Speaker 6: found a number of things. In particular, it talks about 447 00:25:49,880 --> 00:25:52,560 Speaker 6: the multiple things that are at issue when you think 448 00:25:52,600 --> 00:25:56,680 Speaker 6: about black people's ability to create into generational whether it's education, 449 00:25:57,080 --> 00:26:01,040 Speaker 6: whether it's access to capital, whether it's healthcare, whether it's 450 00:26:01,400 --> 00:26:05,040 Speaker 6: jobs and workforce. And as Golden Facts thought about where 451 00:26:05,080 --> 00:26:09,280 Speaker 6: can we step in and really change the tie, and 452 00:26:09,320 --> 00:26:13,680 Speaker 6: in particular, entrepreneurship and our focus on entrepreneurship has been 453 00:26:13,720 --> 00:26:16,720 Speaker 6: that area. I'll share with you a couple of facts. 454 00:26:17,000 --> 00:26:22,200 Speaker 6: Over ninety seven percent of black small businesses are solopreneurs, 455 00:26:22,240 --> 00:26:24,879 Speaker 6: and that means it's a single person or maybe a 456 00:26:24,880 --> 00:26:28,800 Speaker 6: part time person working in that business. Now, black people, 457 00:26:28,920 --> 00:26:33,240 Speaker 6: black women in particular are starting small businesses faster than 458 00:26:33,400 --> 00:26:38,920 Speaker 6: any other demographic in this country. However, after three years, 459 00:26:39,200 --> 00:26:42,320 Speaker 6: what we're finding is that the majority of those businesses 460 00:26:42,520 --> 00:26:46,080 Speaker 6: have failed, and in particular, these women who started off 461 00:26:46,119 --> 00:26:49,560 Speaker 6: with such enthusiasm and such commitment are actually in a 462 00:26:49,600 --> 00:26:52,280 Speaker 6: worse position than if they hadn't started the business to 463 00:26:52,320 --> 00:26:55,560 Speaker 6: begin with. Now, a lot of PEOPLETIONALLI would see this 464 00:26:55,760 --> 00:26:59,160 Speaker 6: as a problem. Golden Facts saw this as an opportunity, 465 00:26:59,440 --> 00:27:02,600 Speaker 6: and two years ago we launched one million Black Women 466 00:27:02,920 --> 00:27:06,919 Speaker 6: Black in Business with the specific goal of working with 467 00:27:07,040 --> 00:27:09,960 Speaker 6: black women solopreneurs to do a number of things to 468 00:27:10,080 --> 00:27:13,919 Speaker 6: grow their revenue, to move them beyond being solopreneurs, to 469 00:27:14,040 --> 00:27:18,639 Speaker 6: employing individuals in their community, because we know black small 470 00:27:18,720 --> 00:27:22,520 Speaker 6: businesses employ black people in their community, and to really 471 00:27:22,560 --> 00:27:25,679 Speaker 6: be able to start to create intergenerational wealth. And so 472 00:27:25,800 --> 00:27:28,879 Speaker 6: we just had about three hundred of them here at 473 00:27:28,880 --> 00:27:31,840 Speaker 6: Goldmen Sacks headquarters a couple of weeks ago, and that's 474 00:27:32,280 --> 00:27:34,480 Speaker 6: a part of our business that we've been doubling down 475 00:27:34,520 --> 00:27:35,920 Speaker 6: on now. 476 00:27:35,960 --> 00:27:37,400 Speaker 1: I want to go back to a term you've used 477 00:27:37,440 --> 00:27:40,320 Speaker 1: a couple of times, jitterary June teenth. You know, that's 478 00:27:40,320 --> 00:27:42,320 Speaker 1: a really tough reality when you're thinking about all of 479 00:27:42,320 --> 00:27:45,040 Speaker 1: the challenges that people are facing in the economy right now. 480 00:27:45,640 --> 00:27:48,560 Speaker 1: What do the next six to twelve months look like, 481 00:27:49,040 --> 00:27:51,040 Speaker 1: given some of the big problems that we're seeing in 482 00:27:51,080 --> 00:27:54,119 Speaker 1: the economy, And is there a risk that some of 483 00:27:54,160 --> 00:27:58,280 Speaker 1: the strides that corporations that the economy has made with 484 00:27:58,440 --> 00:28:01,359 Speaker 1: trying to close the racial wealth gap, is there a 485 00:28:01,480 --> 00:28:03,720 Speaker 1: risk that some of that is unwound. 486 00:28:05,920 --> 00:28:08,840 Speaker 6: Look, I think there's definitely a risk. I would love 487 00:28:08,880 --> 00:28:10,960 Speaker 6: to paint a rosy picture for the next six to 488 00:28:11,000 --> 00:28:13,879 Speaker 6: twelve months in the US economy. But there are a 489 00:28:13,920 --> 00:28:17,160 Speaker 6: number of headwinds. One, we've got high interest rates. We've 490 00:28:17,200 --> 00:28:20,720 Speaker 6: seen the FED hike interest rates ten times since March 491 00:28:20,720 --> 00:28:26,159 Speaker 6: of last year. Secondly, we inflation persists, it's stubborn and 492 00:28:26,240 --> 00:28:29,480 Speaker 6: it's continuing to be high. We see seventy one percent 493 00:28:29,560 --> 00:28:33,080 Speaker 6: of our small business owners saying that inflationary pressures have 494 00:28:33,320 --> 00:28:36,000 Speaker 6: increased in the last three months. The third thing we're 495 00:28:36,040 --> 00:28:40,240 Speaker 6: seeing is workforce challenges. Seventy eight percent of small businesses 496 00:28:40,280 --> 00:28:45,600 Speaker 6: say they're having trouble finding qualified applicants for their open position. 497 00:28:46,040 --> 00:28:50,640 Speaker 6: And fourthly, we've still got supply chain issues that are problematic. Now, 498 00:28:50,960 --> 00:28:55,160 Speaker 6: is there some relief around the debt ceiling. Absolutely, we're 499 00:28:55,160 --> 00:28:57,480 Speaker 6: seeing that in our small business community. But when you've 500 00:28:57,480 --> 00:29:02,960 Speaker 6: got high interest rates, high inflation, workforce shortages, supply chain issues, 501 00:29:03,440 --> 00:29:08,160 Speaker 6: a credit crunch, it's hard to be optimistic in that environment. 502 00:29:08,600 --> 00:29:12,680 Speaker 6: Except I would say this, I would bet any day 503 00:29:12,920 --> 00:29:16,760 Speaker 6: on the resilience and the tenacity of our small business 504 00:29:16,800 --> 00:29:21,000 Speaker 6: community and our black small businesses. I would bet on 505 00:29:21,040 --> 00:29:21,840 Speaker 6: them any day. 506 00:29:22,480 --> 00:29:25,200 Speaker 1: That's a Sahi Pompei, global head of corporate Engagement at 507 00:29:25,240 --> 00:29:32,920 Speaker 1: Golden Sacks and President of the Goldman Sachs Foundation. This 508 00:29:33,000 --> 00:29:37,120 Speaker 1: is a Bloomberg Radio special, Black America Confronts a credit crunch. 509 00:29:37,440 --> 00:29:40,680 Speaker 1: I'm Shinali Basek. June teens marks an important day for 510 00:29:40,760 --> 00:29:44,120 Speaker 1: Black Americans, but it's also a reminder that there's still 511 00:29:44,120 --> 00:29:47,440 Speaker 1: a long road ahead to achieving parody. And as shown 512 00:29:47,480 --> 00:29:51,440 Speaker 1: by our conversations across the financial industry, economic parity in 513 00:29:51,480 --> 00:29:55,200 Speaker 1: particular can't be achieved without doubling down on efforts, some 514 00:29:55,280 --> 00:29:58,120 Speaker 1: of which have only emerged in the last couple of years. 515 00:29:58,800 --> 00:30:01,800 Speaker 1: So how can the country keep pushing forward? Let's get 516 00:30:01,800 --> 00:30:04,840 Speaker 1: closing thoughts from each of our guests, Asai Pompey at 517 00:30:04,840 --> 00:30:09,680 Speaker 1: Goldman Sachs, Ryan Williams at Cadre, Cynthia Day at Citizens Trust, 518 00:30:10,000 --> 00:30:12,040 Speaker 1: and Harold Butler at City Group. 519 00:30:12,520 --> 00:30:15,800 Speaker 6: You know, I think it's about recommitting every day because 520 00:30:16,320 --> 00:30:20,440 Speaker 6: systemic issues needs sustained focus, and I think the critique 521 00:30:20,440 --> 00:30:25,320 Speaker 6: has been, you know, people being episodic or headline chasing. 522 00:30:25,640 --> 00:30:28,640 Speaker 6: And I think what's particularly important is that commitment on 523 00:30:28,680 --> 00:30:31,920 Speaker 6: a daily basis to who are you hiring, who are 524 00:30:31,960 --> 00:30:35,840 Speaker 6: you extending credit to? And so we see that the 525 00:30:35,880 --> 00:30:39,760 Speaker 6: impact of slavery and discrimination persists in this country, and 526 00:30:39,800 --> 00:30:42,520 Speaker 6: I think June tem while it's an important day to 527 00:30:42,640 --> 00:30:45,240 Speaker 6: recognize that and to talk about it, it's about the 528 00:30:45,320 --> 00:30:48,040 Speaker 6: daily commitments about all the days that are not June teemed, 529 00:30:48,680 --> 00:30:51,400 Speaker 6: and what are we all doing then to hold ourselves 530 00:30:51,800 --> 00:30:54,600 Speaker 6: accountable to really making advances. 531 00:30:54,760 --> 00:30:58,040 Speaker 5: I have these definitely one way to think about this 532 00:30:58,160 --> 00:31:03,360 Speaker 5: period of recollection in June teenth. You know, the word 533 00:31:03,440 --> 00:31:08,640 Speaker 5: that I associate sort of with this current context and 534 00:31:08,760 --> 00:31:15,040 Speaker 5: environment is opportunity. And I think of opportunity from the 535 00:31:15,120 --> 00:31:18,400 Speaker 5: perspective of there's a lot of stress, there's a lot 536 00:31:18,440 --> 00:31:22,560 Speaker 5: of challenges. There's so many open questions about, you know, 537 00:31:22,600 --> 00:31:26,080 Speaker 5: where the economy is going, about where certain businesses are going, 538 00:31:26,520 --> 00:31:28,320 Speaker 5: and there needs to be a lot more answers, and 539 00:31:28,480 --> 00:31:31,280 Speaker 5: with those answers, you know there will be opportunity to 540 00:31:31,280 --> 00:31:32,600 Speaker 5: build and during businesses. 541 00:31:33,360 --> 00:31:33,760 Speaker 3: There will be. 542 00:31:33,760 --> 00:31:41,000 Speaker 5: Opportunity to reimagine how we actually finance and capitalize businesses 543 00:31:41,040 --> 00:31:43,760 Speaker 5: that are backed by diverse entrepreneurs. There's going to be 544 00:31:43,760 --> 00:31:47,760 Speaker 5: an opportunity, and there is opportunity to reimagine how we 545 00:31:47,800 --> 00:31:52,280 Speaker 5: support banks that are going to be disproportionately overlooked as 546 00:31:52,320 --> 00:31:55,000 Speaker 5: we work through this period of turbulence in our market. 547 00:31:55,400 --> 00:31:57,160 Speaker 3: I think we have to be intentional. 548 00:31:57,480 --> 00:31:59,760 Speaker 2: I think we have to be committed, and I don't 549 00:31:59,760 --> 00:32:04,400 Speaker 2: think this is segmented into just minority underrepresented communities. 550 00:32:04,440 --> 00:32:05,160 Speaker 3: I think this is. 551 00:32:05,560 --> 00:32:09,880 Speaker 2: A collaborative effort for our whole country. That we need 552 00:32:09,920 --> 00:32:14,840 Speaker 2: to continue to focus on access to capital that creates jobs. 553 00:32:15,280 --> 00:32:17,800 Speaker 2: We need to ensure that our leadership and our management 554 00:32:17,840 --> 00:32:21,000 Speaker 2: inside of our board of directors, in our companies and 555 00:32:21,120 --> 00:32:25,479 Speaker 2: in our government are reflective of diversity and thought and 556 00:32:25,640 --> 00:32:27,120 Speaker 2: ethnicity of our customers. 557 00:32:27,560 --> 00:32:29,800 Speaker 4: It's very important that we not make this a moment 558 00:32:29,800 --> 00:32:32,960 Speaker 4: in time right. Much of what and how we've been 559 00:32:33,000 --> 00:32:35,160 Speaker 4: focused here at the Bank and doing the things that 560 00:32:35,200 --> 00:32:39,400 Speaker 4: we're doing, the commitment of the Diverse Financial Institutions Group 561 00:32:39,440 --> 00:32:43,480 Speaker 4: by you know, Jane Fraser and Mark Mason was a 562 00:32:43,520 --> 00:32:46,560 Speaker 4: game changer for us in many ways. And we've learned 563 00:32:46,560 --> 00:32:50,800 Speaker 4: that it not only matters to the space right to 564 00:32:50,800 --> 00:32:54,760 Speaker 4: our industry peers, to the banks like Cynthia's firm, but 565 00:32:54,880 --> 00:32:59,320 Speaker 4: to our employees themselves. And so you know, it goes 566 00:32:59,360 --> 00:33:03,080 Speaker 4: along way to helping us to indeed change the narrative 567 00:33:03,920 --> 00:33:08,800 Speaker 4: and through very deliberate and purposeful focus. And the last 568 00:33:08,840 --> 00:33:11,680 Speaker 4: part of that, and I say this all the time. 569 00:33:11,800 --> 00:33:16,080 Speaker 4: We need to keep telling the story right, asking the questions. 570 00:33:16,520 --> 00:33:19,400 Speaker 4: If questions are asked and it makes people uncomfortable, it's 571 00:33:19,440 --> 00:33:20,479 Speaker 4: probably the right question. 572 00:33:20,680 --> 00:33:24,000 Speaker 2: We want to continue this conversation of how these recessions 573 00:33:24,000 --> 00:33:27,560 Speaker 2: are impacting these communities. You don't have to go look 574 00:33:27,560 --> 00:33:29,600 Speaker 2: at a study. You can come talk to me and 575 00:33:29,680 --> 00:33:33,840 Speaker 2: I can tell you what I've seen firsthand, but also 576 00:33:33,920 --> 00:33:35,960 Speaker 2: can tell you the successes that come out because we 577 00:33:36,080 --> 00:33:37,000 Speaker 2: keep doing what we do. 578 00:33:37,400 --> 00:33:41,320 Speaker 1: Some closing thoughts to remember on this Juneteenth holiday. Our 579 00:33:41,360 --> 00:33:45,719 Speaker 1: thanks to Asahi POMPEII, Ryan Williams, Cynthia Day, and Harold 580 00:33:45,760 --> 00:33:48,880 Speaker 1: Butler for joining us on today's program. You've been listening 581 00:33:48,960 --> 00:33:53,040 Speaker 1: to a Bloomberg Radio special, Black America Confronts a Credit Crunch. 582 00:33:53,320 --> 00:33:55,280 Speaker 1: If you missed any part of our program, you can 583 00:33:55,360 --> 00:33:58,800 Speaker 1: listen back to the podcast anytime it's available on Today's 584 00:33:58,840 --> 00:34:04,400 Speaker 1: Bloomberg Business Week, Bloomberg Surveillance Feeds. Subscribe any time on Apple, Spotify, 585 00:34:04,640 --> 00:34:08,600 Speaker 1: or anywhere else you get your podcasts. I'm Shanalie Bassek, 586 00:34:08,760 --> 00:34:10,360 Speaker 1: and this is Bloomberg