The Long Game Ep 01 Blackrocks Rick Rieder Inside The Mind Of A 33 Trillion Investor

TITLE: The Long Game Ep 01 | BlackRock’s Rick Rieder: Inside the Mind of a $3.3 Trillion Investor CHANNEL: Cresset Family Office DATE: 2026-05-26 ---TRANSCRIPT--- Today’s guest is one of the most influential decision-makers in finance today.

I think you got to do the work. Markets are vicious. When they know you’re in a bad spot, they tend to find you. He helps oversee a $2.4 trillion portfolio for the world’s largest asset manager, BlackRock. My team knows I say this all the time, what am I missing? And I’m really thrilled to have Rick Reeder with me for the long game. You got to be in the mess. That to me is like somebody who’s a builder. How do you do it? Do you sleep at all? And and how do you manage your day? I think sleep’s a waste of time. Welcome to the Long Game podcast. I’m Eric Becker. I’m an author, an entrepreneur, and I’m founder and chairman of Cresset, a family office that we built to serve founders, multi-gen business owners, and their families. For all of the entrepreneurs and aspiring entrepreneurs, for leaders and CEOs, the Long Game is for you. It’s the practices, it’s the leadership skills, it’s the culture that can stand the test of time. I’m Eric Becker and this is the Long Game. BlackRock is one of the most talked about and studied businesses today, and I’m really thrilled to have Rick Reeder with me for the Long Game. With a career that’s seen boom, bust, downturns, recovery, Rick has built a reputation for disciplined, long game investing. Welcome, Rick Reeder. Thanks for having me on. I appreciate it. Absolutely. So, for our audience, which are CEO founders, uh Cresset community, you know, we love understanding the origins of where of the beginning. And so, let’s talk about your background. I heard that as a kid, you were obsessed with sports stats and even bet your lunch money on games. Do you think that that pulled you into this amazing career? Yeah, I’ve always Well, I have loved sports and then I you know, I love I guess since I was a little kid, I remember I used to study all the statistics and I used to study how football teams played on turf or indoors or how the Bengals played against the Browns and anyway, I thought I I I had an edge. I didn’t. But, uh maybe I did against my friends that I was betting against, but I really didn’t. And they um anyway, but I I think, you know, early on I knew I that I I loved the excitement. I loved the, you know, chance to actually make what I would call, you know, take risk. But, maybe do it hopefully in a more educated way. And then And then I became a financial analyst. [snorts] And I wasn’t going to become a trader. And literally, I got crazy lucky because a woman that was running an interview the interview and a training program at EF Hutton, which I don’t know if anybody ever still remembers. It was the first training first and last training program. Anyway, the woman said, you know, I was going to be a financial analyst again and I loved doing analysis. And you know, and I don’t know how she knew my background and then and then she said, “Why don’t you give trading a shot?” And my I remember my dad said, “Trading is not It’s a hobby. It’s not a career.” And anyway, I’m almost four decades into my hobby now. And um anyway, I still love it. I mean, I still love And by the way, you know, you go through like periods like it it’s a hard business and it’s frustrating at times and you could do all all the analysis you want. And then like stuff happens. So, anyway, hopefully getting more right than wrong. So, yeah, that was about the was the origin. That’s awesome. And you went to Wharton for business school and at some point were at Lehman Brothers including during the great financial crisis of 2008. Um what did you learn from the great financial crisis and the end of Lehman that as time goes by it guides how you’re thinking about and how you invest today? Well, I mean, so I I left I left 5 6 months before the financial crisis, I started a hedge fund and, uh, I didn’t think I didn’t think you’d have the duress you had during that period. And quite frankly, I thought it was one of the most interesting periods. Some of it did I We have some volatility in credit. And, um, anyway, I so I would certainly when I started my fund back then. But, listen, I learned, you know, being on the sell I was on the sell side for 20 years. I learned a ton being on the sell side about, you know, one thing you do when you’re on the sell side get to know your clients. And, you know, why does you know, why does some people invest this way and, you know, my clients who are now my my clients then were now my competitors. Like, why do they do this? Like, why you know, why and I and they were I you know, I tried to pick up some really good traits from how they did things. And that really helped me to see to get a real visual on what they were doing, how they were doing it, et cetera. And And like, what were some of the some of the positive aspects that I and and or the negative ones I didn’t want to that I didn’t want to do. And then I the same and being a trader, you know, learning hedging, learning technicals. Like, the technicals are I mean, in some markets like recently, technicals oftentimes overpower the fundamentals. So, how do you think about technicals? How do you manage risk? How do you hedge? How do different people across the universe do it? That was a pretty good pretty good training ground for me that And I will say one thing, when I started investing, it took me two years to realize that trading and investing are really different. With trading, the cool thing about trading is every day you get a scorecard. And then you’re like, okay, I got I got And you know, in trading, you you want to try to make money every day. Well, investing, oftentimes you want to put money to work when you’re not making money. As Avi and I were putting together Crescent, we had a vision that Crescent would be a 100-year business. So, we studied organizations, families, and companies that lasted 100 years. And we saw that over a lifetime, either a human lifetime or a company lifetime, there were these moments of truth. And one of the things that I read about with you is that at one time early in your career a loss led to the realization that you’re not in the business of being right, you’re in the business of generating returns, which makes me think results. Um can you explain the difference between those and how that changed the way you invest? Eric, I want to you know it is it is a really big I so I lost a lot of money on one position. It was like the first or second year I was in the business. And you know I remember you know we went to school and you studied really hard and you know if you did you know if you studied really hard you you know try to get a

It was a it and and if you prepared you probably were right. In this markets can be wrong for a really long time even if you are right which is not definitional by any stretch. But even if you’re at the markets can be really wrong. Like I think the efficient markets hypothesis I learned in business school is garbage. Like it’s they’re not efficient. And the markets can be really wrong. And you know I I learned I mean that one trade like taught me a ton about you know what I call you’re right you’re right you’re wrong because it doesn’t matter whether you’re right the markets think you’re wrong you’ll have a problem and particularly if the markets know you were in a bad position. Markets are vicious.

[laughter] When they know you’re in a bad spot they tend to find you. And so no I it really helped me thankfully early in my career when my boss didn’t let me take a lot of risk. Thankfully it it it it taught me a lot about how do you manage risk? How do you think about and you know today and include when I when I say today literally today you realize how sentiment and psychology and we’re not like if we’re right on a theory or we’re right on a theory or we’re right on a on a proposition around markets or economy or or credit and and we’re right and but you don’t get the realization of that for 2 years markets can really think you’re wrong. And so, we’re in the business of anticipating where are the markets going to allow us to exit or enter if we’re setting up a short. Like and and what you know, what will will be and it’s a little bit of psychology and a little bit of trying to predict the future of what sentiment will look like as opposed to it doesn’t really matter if we were, you know, if we’re ultimately right. Like we don’t we don’t get any gold stars. Right. And are you still in the seat two years from now when you’re finally proved right? You might not be in the seat. I think of yesterday as the most recent example. Woke up in the morning, um sort of thinking the sentiment was risk off. Open up CNBC, see Warren Buffett making some comments that he’s kind of on the sidelines. And then by the end of the day, the markets pop. And and that’s just one day. That’s yesterday. I mean, it’s it’s it really is incredible uh how things change. Hey Hey Eric, can I can I throw a one point about that, which is such a big deal? I I learned from Paul Tudor Jones about the technicals and about how the technicals matter over and above the fundamentals. Your point about what happened every you mean, everybody lined up on one side of the boat. And more than I’ve ever seen in my career, there is this momentum around markets. I know that’s social media promulgated or what have you, but like everybody’s got the same view all together. And then everybody gets in one position all together. But one of the, you know, keys is like when the technicals become so profound, like that’s going to drive. And or if you get some catalyzing event that that that, you know, changes the paradigm, you can get explosive movements. So, price matters, technicals matter. And then obviously fundamentals matter, but I maybe I grew up in my earlier my career it’s like, you know, I was always about fundamentals, cash flow, and like, you know, all the you got to marry it all together. You do. And and it’s interesting because um um while with what’s going on today, I know that the consumer looking at say the price of gasoline at the pump, there’s a lot of pressure on the consumer. But when I look at companies, um clients of ours that are running businesses and own businesses, business is pretty good. And then when you, you know, look across the board, it seems like we have a good economy. Um so at some point when this war that’s going on becomes uh comes to an end, you you just have have to believe that there’s going to be a different view of the market when that’s taken away, that friction. I totally agree. You know, I people like to look at I was listening to somebody on TV today talking about the analog of today versus 40 years ago. I think you have to respect history and then you have to ignore things that are environmentally quite different. And they were talking and it was long discussion about about growth and at the end of the day today, you have something that’s very, very different. US economy is unbelievably flexible, resilient. And you know, you got to put a little bit of perspective to we don’t have a goods-oriented economy in nearly as acute a way as we do services today. So the oil shock is a big deal. Similar way tariffs, you know, remember everybody moved to the side of the boat, oh my god, recession, deep recession, I don’t know, I got to get out of everything. And then when you actually break it down, you see tariffs, US is the largest importer of goods in the world. It’s also the least reliant on on trade for GDP in the world of all the developing countries, developed countries I should say. Same thing with I mean, that oil shock’s a big deal. I don’t know so do you haircut growth 100%? But you haircut at 30, 40, 50 basis points, maybe 60, 70 basis points. And again, what is more, there’s so much, you know, what drives the economy today in services, etc., healthcare, technology, etc. So, anyway, I just think you put a little bit of perspective on it and um you know, we’re operating from a place the economy, you know, going into this, we’re we’re running at 5 and 1/2 nominal GDP. Yeah, so things are looking good. Like and all of a sudden, like every time I turn on the TV, it’s stagflation. Like yes, you have to respect that something different and then by the way, I don’t mean to dismiss, this is a big deal. It is. But I think there’s a little like you say, you know, you’re still like when you know, you run your daily life and you look at it like, “Wow, people are like doing their thing.” Like the economy’s still doing its thing. So, anyway, I think you got to really be respectful of change, but maybe a little bit of of data on the So, listening to you, I hear the voice of experience, which uh you know, we are in the decisioning business, the good judgment business and good judgment comes from, you know, many times uh bad experiences, things that we learn from. Um in in the role that you have now, how do you think about that sort of decisioning engine? Like is there is there an investment committee structure? Do you have Do you have a team that you talk to about it? Um the day that the Iran war breaks out, you know, are you gathering a group and starting to talk about how you’re going to make decisions with that new event? Um how how does that work at BlackRock and with you? It’s a great question. It’s it’s all it’s a very depending on types of investment. So, so we have an investment committee. We’re putting on an investment that’s going to be with us for longer than 6 months or we anticipate there’s a longer exit strategy. For my funds, we have a full investment committee. Mhm. We’ve had it with people in reg in regulation, legal, tax. And then we go through a full, obviously, research analysis. And then we go through a full vetting process. You know, when it comes to like investing in the markets, you know, I got a team I work around that is, you know, we built an I’m unbelievably blessed that bunch of us worked together for over 20 years. So, we got a good group of people that I trust. I talk a lot to clients. Like I talk a ton to our clients. And obviously everybody internally in different disciplines, different run different funds, but I learn more from clients and CEOs. And you know, I’m like I said, usually been out a lot has to do with I have a I have a job that allows me to interface with people that are that run big businesses or what have you or big clients. And anyway, by the way, I still think when I when I’m on the phone with them, like, you know, like it’s a huge honor that I’m get to talk with these people. And are there any with all the experience you have, are there any characteristics of a great investment committee? So I think about you know, one end of the spectrum it’s everybody’s combative and you don’t get anywhere. The other end of the spectrum is everybody’s overly supportive. You’re not You’re not challenged. There’s this sort of constructive tension. Is that the sweet spot where it’s like you said, you want to be challenged to make better decisions? I mean, I you know, complimentary skill sets is usually important. Like crazy important. So like if we, you know, if we set up an investment committee that were people that all look like me and agree like and agree with me, like I have no chance. And we’re just going to make bad risk decisions. But complimentary skill sets, people are willing to challenge. Yeah. It’s not always group think. Like at the end of the day, you have to have be willing to make a decision. And I found that often times you need You need to have a committee make good decisions, complimentary skill sets, thoughtful people willing to disagree. And at the end of the day, you got to make the call. And often times groups tend to not want to take risk. Like groups, like you always err on the side of the person who tells you the why not. And the person who has the you know, you got to take risk in the whole two business because otherwise you’re you’re you’re not going to do anything. Right. I think discouraging the why, you know, like evaluate the why not. And then say, “Okay, I get it. I should assess that.” But, you know, a lot of people no regrets. Like you want to hear the other perspectives and you want to know that it was fully discussed and then you make your call and and and then and then you go back later and you can analyze how good of a call it was or what we learned from it. Um but it’s it’s no regrets. We want to hear those things, but you’re right. If we made group decisions with groupthink, we would never take any risk. Eric, you know, I found that and I got to go back and see if this is empirically correct, but I think intuitively it’s correct that I think more the committee meetings that are voted 5-4 and 6-3 in favor are better investments than the ones that are 9-0. I think that I I got to go back and look. Yeah. I think you’re right. I think you’re right. Do you guys use um AI at all in in in that where like sort of like the something’s listening in and then giving an AI point of view? Increasingly, we’ve built these agents. You know, so we’re big believers in regime identification and obviously, you know, looking at all idiosyncratic risk and then have these agents that can actually evaluate, think I know I would say yesterday I was trying to understand some things around turbo quant and a bunch of other things. I mean, the information we get is just extraordinary. And so, we’ve built these agents to help us do a whole series of thing, data assimilation, evaluation of conditions, um predictive analytics, stress testing. So, yeah, we and I I would say we’re at the nascent stages of um of really utilizing them. So, we we’ve built an entire team that’s dedicated to taking us to the next level on that. But it is um I have to say I mean, I think people underestimate it. And I know I say that too. The productivity enhancement or improvement we’re going to get, I just see it in our own business. It’s unbelievable already how people are leveraging the the to free up more of their time, they’re more productive. It’s incredible. I I mean, I think people underestimate it. I you know, I have a view at Real Vision what it means for labor and what it and why I think inflation’s coming down. But I you know, I drive in and I usually listen to CNBC or Bloomberg. And yesterday, I just talked to Gemini. And I said, “Teach me about this.” And then I’m like, I don’t know. Not that I By the way, people should probably do that when I’m on CNBC, but the um you know, I learned a ton. A lot more you know, listening about some nuanced garbage. Oh, it’s incre- it’s incredible. When uh when ChatGPT first came out as an experiment, I built a virtual advisory board and I put, you know, like Buffett on it and other people that I’ve always respected and read about. And it simulated a advisory type relationship. And I thought to myself, “Everybody has a mentor now. Everybody can have a cool advisory board with this technology.” It’s pretty cool. It’s what So, by the way, I I just found out that you know, they’re coming out with these glasses that are coming out. So, now you know, I’ve gotten the honor of talking to I talked to Elon Musk a fair amount. And like it I think the guy’s crazy genius. And I Anyway, you think about where he’s thinking about where things are going. And he said to me and he said in other forums that you won’t be able to it’s at some point in the near future you won’t be able to separate the real world from the virtual world. Meaning, like you go back to these glasses, like somebody not him, somebody told me, like with the glasses, you’ll sit at dinner and you could have three people at dinner that are not there. Right. Like how freaky how freaky it would be probably cheaper uh when you think about paying if you have to pick up the bill, but the the uh like that’s kind of freaky. Well, imagine Thanksgiving dinner with like a really wild family, you just turn the volume down on the family members that cause all the trouble. [laughter] Yeah, I know. But following up on that, following up on that, you do talk to some really, really cool people and um when you think about these leaders in technology that you’ve come to develop relationships with over the years, what what what are some things that you’re hearing from them that are coming down the road, you know, like what you just described? Are there other examples of things that are kind of blowing your mind or that you’re super excited about? Space. I think space is unbelievably cool. In fact, I was trying to figure out today, which I can’t go, there’s a rocket launch in Florida that I was trying to go to, but uh unfortunately it’s too early. The um anyway, I think space I think the way data delivery is going to work, the way we actually, I mean, you think about, you know, for you know, how we get data, you know, in in a in a particular, like internet delivery, Mhm. data center in the sky. Like, you can take clearer more more visual pictures from space than you can down on Earth often times. I think space is going to be the most extraordinary set of technologies. That that That is one thing that I think is going to be pretty spectacular. I think I mean, obviously AI, you know, autonomous driving is is pretty incredible, but I’d say the one that I don’t think people talk about that is going to be a bigger evolution than I think people give credit to is is space and the things we could do, including health care, things you wouldn’t think that are that are um that are pretty amazing about how that will allow us to do things, you know, obviously because of energy costs, etc., but that that one is uh blows me away. I I agree with you. It uh it’s it is amazing. Um you know, one example, I love to hike and uh to go to like Pisgah National Forest outside of Asheville, and I had these satellite transponders that I’d give to my kids and whatnot. So, if you were really away from the cell towers, now not only does the iPhone have the ability to talk to a satellite, but T-Mobile has these low orbit Starlink cell towers now that can talk directly to your phone. And so, you can be in the wilderness and you can actually have cell coverage in the middle of nowhere. And it’s just amazing to think that that comes from space. When you think about like every RV, every plane, every train, every developing country, like the ability to provide data is uh is pretty incredible. And uh so, no, I think I think that the sheer size available size of the market and other and other um and I don’t even think we’ve thought through all the other things that be accomplished in uh in orbit. But, I think I think that’s that that is one. Obviously, it goes without saying everything around AI, but I think that is that is turf that’s well uh well covered. I agree. But, let’s talk about something I’m curious your view um about AI in terms of its impact on society. So, I think we’re both super bullish on the impact on productivity, how that could have an impact on inflation. Um so, that’s all exciting, but we do hear a lot of angst and worry. When you think about it as a leader of a company, um as a a dad and family person, and you think of kids and nieces and nephews and whatnot, how do you think about how AI is going to impact daily life and um you know, jobs and things that people worry about? You know, I’m an extreme on this cuz I mean, I use it like you do. And I find it extraordinary. I think about like our software the the way we use software and different up in like where we could do it through LLMs now. Listen, I think we have I think that I think the speed of adoption is going to be faster than the ability to to transition employment. And I I am respectful of people who say, “Whenever you have new technology, you grow.” and growth provides for more jobs and you just switch you transition people into that. I’m respectful of that. I also think there’s a transition period. This this this application is designed specifically to replace human thinking, cognitive behavior. And I just don’t think you could retrain the 6 and 1/2 I use the analysis of vehicles, of driving. There’s 6 and 1/2 million people in driving in this country and the average age of a truck driver I think is 55. It’s pretty hard. You know, we need more people in health care because the aging demographic. Pretty hard to retrain somebody to go into health care that’s been driving for 20 years. I just think that speed is you know part of why I got involved in this Fed thing and and like I have a real you know, aspiration towards like how do you you know, how do you help a bunch of people because I think this transmission is going to be really hard. I chair the board of 14 charter schools in Newark and I do a lot of work in Atlanta in the school system. Eric, I don’t know the answer. Like I you know, I stand I may I may have this totally wrong and I don’t have any wisdom here. But you know, we go through and think about our curriculums and like what are we teaching kids? Like and you know, and I get all the time like what do we tell kids to go to school? The only thing I will say I am a believer in thinking at a higher level allows you whatever happens allow is so when people say, you know, you don’t need to go to college there’s some smart people who say that. I don’t know. Like I think thinking at a higher level but what the what the industry what the world looks like anybody knows what the world looks like two to three years hence, two to three years hence I think is not sincere. I read something this morning actually that I wanted to ask you about that I hadn’t thought about and that is that as AI does impact say entry-level positions in companies that that over time could affect the development of good judgment because like you know, you and I both started kind of at the bottom and then we worked our way up and through all of our lessons learned, that’s how you get to where you are today. Well, if if a young person doesn’t have that opportunity, how do they develop good judgment? And so, the argument that I read this morning in this article was, we need to make sure that we actually preserve entry-level positions so that we can provide future leaders with experience. It was an interesting perspective. What do you think? I don’t know that, but I think it’s I think it sounds intuitively correct to me. You know, I I can I say I’m a I’m a I’m a believer in capitalism as an as a obviously as an appropriate ethos. However, I also have some respect for the idea that regulation and encouraging, maybe in this form and otherwise, like do you slow down some of the implement because it’s just so hard to transition people? And it’s a social issue, it’s a young people issue, it’s a low-income, it’s a small business issue. Like can you can you slow down some of this incredibly rapid pace of adoption? I have some sympathy for it, um which just goes against everything I believe in in terms of capitalism, but I I also think there is there is a human aspect to this like you were describing that I I think is um is important to preserve. Well, after they’ll be for policy makers and for people that are advising policy makers, there’s going to be a lot to be thought through. And maybe there will be things that that weren’t as big as AI, but will serve as examples. And one thing I read about was, you know, we all think about Apple now and and we think about our cell phones, our smart phones, but at one time Motorola and Nokia, they were the kings of uh you know, of the cell phones. And Nokia, which was a Finnish company, at some point, you know, kind of went away for all intents and purposes. And the Finnish government really had to get involved because apparently that was such a dominant company in their country, there were so many engineers that needed to then find new things to do. So, they did experiments and came up with policies. So, maybe we’ll be able to find some examples that’ll give us some inspiration, but it is going to require new thinking. That’s for sure. You know, I’m I’m a believer, you know, for for years like monetary and fiscal policy worked to hand in glove. And then for the last number of years like we put all the backbone of of of economic growth on monetary policy. I think effective fiscal married to monetary, like if we get back there, Mhm. I think that’s a really powerful dynamic because I do think effective, you know, putting it all on like in the interest rate tool doesn’t really work. I mean, think about negative interest rates in Europe. Did that really do anything? I would argue no. In fact, nothing positive. But but you know, they I because they didn’t get any fiscal initiative, you had to put it on the back of Mario Draghi. Like I think there’s some really thoughtful fiscal initiatives that that can be implemented. I agree. Let’s shift gears a little bit. Um when you were talking about um relationships that you have with CEOs and with leaders of of big technology uh companies, founders, um you we have such a community of CEO founders from literally first-time CEO founders to serial CEO founders. And I’m curious what you’ve learned um about CEOs and you know, which ones uh are successful, which ones are less than successful. Um what are some things you’ve learned about, you know, what it takes to be a great CEO and then one that you might want to invest behind? You know, Eric, I I you know, something I’ve learned about investing in equities that that took me I don’t know, long three decades probably to figure out. You know, it’s actually the person running the company and their management team that’s arguably more important than anything else. And I and I it took me, you know, I because I came from the credit background, I would study cash flow, the balance sheet, your business, you know, what’s your operating income, how do you get there, how do you drive cash flow? Which actually we live in a world where pivoting your company is incredibly important. And you know, most come when I found many many companies have now most of them they start out something different than they originally anticipate and then they pivot. I find that and Porter you know, I mentioned you know, like a guy like Elon Musk or I mean think about like how he started certain things and then like all of a sudden he’s he’s moved. Yes. And I to me I’ve learned more about and I you know, I’ll say one thing the only way I think and and like I said there’s some CEOs on this call but way more versed than I am in this. But I think you know, it’s quite frankly you got to be in the mess. Like I see a lot of you know, people that are that are detached that are CEOs not a lot thankfully that are detached. But the people that are in the mess that literally can tell you every part of their business and that have the ability to actually think and pivot because they understand exactly what’s underneath the surface versus you know, they sit in an office and whatever floors above where the where the actual stuff happens. That to me is like somebody who’s like a who’s a builder and and is in the mess. Is a They’re obsessed with their businesses. Yeah, you know, they’re they’re they’re incredibly focused really obsessed with their businesses. They they have people around them that tell them not what they want to hear but like tell them what’s true what’s really happening. Um and so that’s another characteristic that we see and then signal they they managed to stay in touch with whether it’s the customer the front lines as you called the mess. They they they find a way of staying in touch with that and not becoming isolated. That’s for sure. Totally agree. And I’m at Anyway, I think that I think that is a big deal. I mean I will say within my world I’m CIO not CEO. Yeah. But I would say like an important I made earlier about like if I don’t talk to clients like I don’t really understand like what’s happening in the uh you know, what how are they thinking? What are they you know, where should I be investing alongside of them or or in parallel etc. But I don’t know. I think you got to do the work. Hopefully AI’s is going to change all this. We don’t don’t have to, but I think for the foreseeable future like being in the middle of it, I think it’s a big deal. So thinking of our of our next gen like my two boys that I’m sure are watching this and they’re in their 30s. Um when you think of your life whether it’s a teacher, a coach or a boss, a manager that that you worked for in your entire life. Is there one person that comes to mind as like the best boss or the best coach or the best teacher that just above all there were some characteristics that would be interesting to hear about them? I mean I’ve been lucky. I’ve had I had one in Lehman that was gentleman Bart McDade who I worked for for a long time who I have a ton of respect for and taught me a lot about you know, thinking about people and and giving people a rope and then letting you know, but make sure you watch them etc. You know, Eric, one thing I’ve learned and and and I would say some from some public officials is you know, I I spent much of my career thinking through like I want to make everybody happy. And it took me a long time to figure out actually if you’re trying to make everybody happy there just some people that are not going to you know, accomplish what you want them to accomplish and like we’re not in the business of making everybody feel good and uh like that is a hard thing and I’ve always wanted to feel like like everybody feel good and making everybody happy and I I think at some you know, it took me a long time to figure it out. You got You can’t keep everybody happy. You just can’t. And again and you know, whatever. You just got to do what’s right for the broader business and your clients and your constituents. That’s been a you know, I would say the last five to 10 years that’s been a big one for me. And so then thinking about putting all those things together. So from a CEO perspective it’s like you know, know the details, be in the mess, be highly focused, and realize you’re not going to make everybody happy, and you’ve got to be able to live with that, make the decision, and then live with the decision, analyze it later, see what you can learn from it. And then, you know what? And then get through. Like I make some bad ones. And then hopefully they’re not fatal. And you know, I’ve been a big believer in you know, you’re make sure your your the decisions you make and the risks you take are well sized in terms of the impact they’re going to have. And then, you know, and then just get through. I get depressed when like you make a bad decision, and and then you just got to like think about it. Like if you didn’t take the risk, you’re never going to do you’re never going to you there’s some things that just don’t work out, and often that’s because of exogenous influence. But I think you know, I just think you got to get I I just think got it, but I think you got to look through like you make bad decisions, and you just got to say, you know what? You’re just going to do that. And going back to that concept of of like a bad trade that ultimately you’re in the business of generating results or returns, I also read that you like the idea of making little bits of money lots and lots and lots of times rather than just focusing on making a lot of money in one trade. Um can you talk a little bit about what that really means and how you how you live by that? Yeah, I mean I have a very very different philosophy around equity investing and debt investing. When you invest in bonds, they either pay you back or they don’t. They’re not going to double in price. So I believe in in fixed income and bonds, I really believe in this idea diversify, and you know, I view bonds as like running a casino. Like if I can tilt the odds in my favor to do it a billion times, and diversify, you know, take the raise the interest rate exposure in some area, take some credit risk here, and just and my view being it just statistically, I think we can get liquid assets right 60% of the time, illiquid 70% because they require more work they’re illiquid. Just do it a billion times. Mhm. And um and let your teams do, you know, you know, take the risk around it and just and just keep doing it. Run it like a casino. Diversify like crazy cuz in fixing income you do it, there’s a million four, literally, securities in fixed income. Tranches, publics, privates, real estate, commercial real estate, resi, etc. Equities I have a very different view. Equities they can double or triple or quadruple. And it’s hard to diversify equities. Think about the 10 stocks. What were the 10 stocks? 60% of the return last couple of years. Right. Like, you got to get on the right engines in equities. And so, I believe that in in the way you run, I think, bonds, diversify, create a lot of income, create stability. [snorts] Clip coupon often times. In equities, I think, you know, per the like you you would ask questions about like what are you most excited about? Finding those areas you’re most excited about. How do you exploit them efficiently? Who are the right company, you know, CEOs, companies to do it? And then I think you got to take the risk. And I think and, you know, hopefully in equities, it’s different than bonds. You can get three wrong, but the one right can crush it for you. And uh just so different in bonds. I need to get I need to get more right than wrong regularly. You do. So, I I I I I I leads to, I think, something that would be super interesting. You know, we have We all hear about the great wealth transfer that’s going on. And we see it in that we have a lot of CEO founders. It seems like almost every week that are having exits, where they’re selling their businesses typically to uh either private equity or they’re selling them to larger companies. Uh I’m curious for that person that maybe had the good fortune to sell their business in the last 35, 40 days. where we are today, you’re sitting completely on cash. Um what would your advice be to somebody who is now going from running a company to having to take that capital and be an investor really for the first time ever. What would your advice be just listening to what you’re just talking about? I’m sure you have a point of view. So when I like for doing a long time debt equity commodities everything. I’m a big believer one of the great secrets is particularly if you’re in a place that I were sitting on a decent amount of wealth is income really works. Like I really believe in this idea of income. Like I think if you study equities over time and like you look at your return you get from cash flow and dividend income really works. If I were in that camp today you know, I believe in this thesis like creative create a an ample in income stream. By the way, part of why munis work you know, like I think today long and munis are interesting like creating income to me is like a really really big deal and it’s incredibly uh you know, like we spend a bunch of time talking about I mean in my platform the 10-year Treasury. The 10-year Treasury hasn’t really moved from four and a quarter for like three years and we still talk about the 10-year Treasury. The fact of the matter is if you can create a stable income you know, today we’re trying to create six six and a quarter you can do it cuz rates are where they are. If you create income and just keep clipping that coupon and particularly where you are at point point of life like that to me makes and then I you know, I would you know, everybody’s different around their disposition around this. I think the next few years if you said you’re in that position would you create a lot of income and a lot of stability protect what you have. I also think venture is really you take a barbell I would. I mean I I would cuz I think technology’s changing faster than anybody’s ever seen. Like participating in that you know, why not and I why not and maybe maybe you you know, you catch lightning in a bottle and there are enough of those companies that are that are uh that are coming down the pike. So I don’t that would be my disposition. I I like it. When you were talking about income and focusing on income it reminds me when I was 19, my my mentor and boss was a guy named Larry Levy, a fabulous person, and he used to call it CTO, cash to owner. That’s what he called income, cash to owner, CTO. And anytime he looked at a deal, he wanted to know, “What’s the CTO in this deal?” So. Well, that By the way, I mean, I By the way, I also think people underestimate US equities. So, I mean, if you said to me, like, how would you how would you structure it? Like, if equities throw off 20% ROE, Mhm. you know, if you start, “I’m going to So, anyway, there’s a balance in there that I think that I think makes sense. I don’t believe in like, now I have wealth, I got to do a 60/40 because like, you know, do I need to own long interest rates? Like, why? I don’t So. Anyway. I think it’s good advice. So, get continuing with the theme on advice and getting a little bit more of your individual, you know, kind of working style and things that you’ve learned. Um I’ve read that you’re a workaholic and intensely prepares for everything that you do. Um and you’re in this 24/7 business. Um how do you think about structuring your life around a 24/7 business and wanting to always be really well prepared? Like, how do you do it? Do you sleep at all? And and how do you manage your day? I think sleep’s a waste of time. But the It’s probably not good advice. That’s probably stupidity. But so I mean, I I mean, I’ve simplified my life, and I realize at this point in my life that, you know, people say, “I’m I’m incredibly varied and cultured.” And like, I I’m going to lose at that. Like, I get it. But I know I love hanging out with my family. I know I play sports, I play golf. And then I just when I work, like, I work crazy hours. And I’ve just tried to simplify like, what’s important. And obviously, my I do a lot of work in urban education, and my philanthropy has meant a ton to me. So, I’ve just isolated to like, I want to do that. And then uh you know, my wife says, “We’re going to the movies.” I like I don’t like going. [laughter] You know, even it’s going with her that Yeah, no I that’s so that’s what I’ve tried to do and I Listen, anybody who thinks, you know, even with AI everybody’s going to have AI is a great democratization of information and what have you. I still think you got to put in the time. I I just think this is no matter what industry we’re in, it’s incredibly competitive. And I just think it I don’t know that you know, AI is going to augment our ability to I think make good decisions. Yes. I’ve just decided like I you got to work harder than the um I world gets more information so you need to get more information plus one. Yes. And um so You got to put in the work and even by the way with this new emerging technology, it also means putting in the work with AI. I recently started trying to schedule 30 minutes a day just uh you know, like you talked about being in the car and talking to Gemini. I’m trying to build that into my day so I’m learning. Full self-driving is a is a helpful utility there. It is. Do you still have the motto work hard, play hard, give back, reboot? Yes, sir. So I have it. I mean literally when I walk out of my bedroom every day, I have a big sign that I look at that says work hard, play hard, give back, reboot. And that’s they know, for your question. That is my life that is my life. Like I you know, I believe in that and I you know, just keep you know, keep that going but I you know, I when they give back thing is a really big deal to me because it it’s By the way, it’s not because I’m this incredible altruist. Like it makes me feel good like I and they and I think it’s so anyway, that’s a you know, great Well, I don’t have the balance of going to enough museums and and and art shows. I do go every now and then. But the you know, that that to me creates some balance for me. I think the giving back part it’s like part of the of the deal. We all start off, you know, as kids and and so there had to be people that help us along and it’s up to us to pay it forward in however we can from mentorship to philanthropy and service. Um I totally I think it’s just part of the deal is giving back. And I think it’s selfish to some extent, too, because it makes you I mean for me it is. I mean I’ve I’m it makes you uh Like I go to the graduations of our of our schools and you watch these these kids succeed and you watch their families, you know, and I you know, for me it’s a it’s a pretty uplifting experience. So, a a few um kind of wrap-up questions. Uh I ran this contest many years ago. I had 80 board members of companies I was invested in and 20 CEOs, so 100 people, and I asked the question, um what’s the best question you’ve ever asked uh or been asked and why? And the winner, a wonderful CEO named Gary Keesling, he said, “I ask myself every day, what am I tolerating but shouldn’t be?” And uh that question won the contest and you got a nice dinner that we sent him off to with his wife. Um and I’ve I asked myself that question now all the time. I found it very powerful. Is there any question like you’ve got the motto on the sign when you go out of the bedroom? Is there any question that you like to ask yourself or that you believe is a powerful question to ask others? You know, I’m I feel like, you know, every day I’m going to I just like to I think I’m I think I’m uh I think the devil’s advocate question that I ask every day is like oftentimes I have a view on something and then it’s like I want to know every day like what do I have right now? You know, my team knows I say this all the time, what am I missing? And the um that question I mean I must say it to my team on email or otherwise 100 times a day. What am I missing? What am I missing? What am I missing? To me, that is the question because uh you know, anybody’s investing for trading or whatever, there’s a sense of paranoia that like you know, everybody else knows what’s going on and you’re the dumbest person out there. And the sense of paranoia that actually I think causes you to ask the question, “Okay, you know, there’s something I’m not getting it.” And usually when you find a security that’s misvalued, it’s misvalued for a reason or it’s or it’s not. And then but it but you know, that to me is like that is the big question I ask all the time. What am I missing? And then you try and if you can evaluate that and then put it in a box to understand you know, what is what does that mean relative to valuation, etc. But that to me is the big question that I ask all literally all day. That’s a great question and with that I want to thank you for doing [music] this interview with me today. It’s been really a lot of fun. We’ve covered a lot of different topics. Not always when we see you on CNBC talking about what’s happening that exact moment and you’ve been very generous and open which I really appreciate. Some of what stands out to me is how disciplined you are, how thoughtful [music] and and focused on what it is that you do and which to me is all part of playing the long game. And [music] and how you have defined these moments of truth whether it’s learning from a painful lesson or learning from things that that did work and [music] then how to pivot from all that. So a really a master class here today in investing and this perspective. So appreciative. Thanks for being with us. I really appreciate it. Great to see you. Sure. Thank you, sir. Appreciate it. Before I let you go, if this episode resonated with you, please share it generously and please click the subscribe button below. Send this to someone in your world who’s navigating a pivotal moment right now. Someone who’s staring down a decision and might need the reminder that recognizing the moment is half the battle. See you next time on The Long Game. The Long Game, a Cresset podcast, is intended for information only and is not investment advice. Any company discussed is not a recommendation to buy, sell, or hold any security. Investing involves risk, including loss of principal. Please consult your advisors before making investment decisions.