22 Burst results for "Matt Levine"
"matt levine" Discussed on Decrypted
"Here's former. We work executive Dave Fan. No again. I don't think anyone thought he could close his series A. And to get a prestigious firm like benchmark to invest and they did. And that then he could get some of the prestigious landlords to leases with us and then they did. that. We could double the size every year for ten years in a row, and then we did. You know that you could raise the largest private equity round ever, and then he did you know it's just. Across the board. He was able to do it. I mean as a collective I think we did it I. Don't think he did it on his own but I I do give him credit for setting off goals that people then rallied around and achieved. One work kept beating expectations over and over again. Dave credited this in part to Adams personality. He said Adam never asked himself. What could go wrong I don't think he hardly ever operated out of a place of fear. I think in in business, there are folks that play not to lose. And there are people that played a win. He was playing to win. Optimizing to not lose was not part of the way that he operated. He is not a defensive player. And then of course, things did go horribly wrong. Billions of dollars vanished into thin air. A lot of people started comparing Adam to Elizabeth Holmes the founder and former CEO of their nose. You can understand why they were both these stars of the startup world reporters wrote big profiles about them. Their investors said, they were changing the world and they held Colt like sway over their own companies. Until things fell apart. And all of a sudden everyone was mocking them and tearing them down. I spoke to Matt Levine a Bloomberg opinion columnist and he says that the comparison to Elizabeth Holmes isn't justified. The crime that people get in trouble for usually. In when the company implodes is some variation on securities fraud like Elizabeth Holmes was arrested for Securities Fraud because she allegedly lied to the investors. Clearly didn't lie to investors like at all. Well Adamson lie to investors as far as we know, there are some ongoing investigations, but he hasn't been charged with wrongdoing. The the problem here was not fraud. The problem here is not that Adam Newman went to naive investors and stole their money on false pretenses it that Adam Newman went to a very aggressive investor and he was very aggressive and they sort of build each other up and ended up in a place where they're both kind of unhappy. So the story of we work from this lens isn't so dramatic Adam was just a guy who knew how to take advantage of venture capital he worked within the system Matt even thinks that something good can come from the work story it might push other businesses to behave more responsibly. He calls it a triumph of corporate governance. It gives the market some ability to push back on future IOS because. We were if you said I want to go public but I WANNA keep control my company forever and give the public nonvoting. Stock. Your bankers would have said anything like that, and then you'd say, well, bullet matter the bankers and say, honestly like there's never been a deal pulled. The deal that people rejected because of bad governance really now after we work, that's changed Nassar where you can say actually like if you're governance is bad enough to be a huge disaster, you won't get your deal done and you'll have to go for a rescue financing. Then you'll see you and they'll be mass. and. So it's a good think cautionary tale for the next company. And those glory days of works big investments work hard play hard partying mentality. Some already remember those as the good old days a thing of the past. Here's Carl Pierre the former community worker in DC I look back I still I still believe in will defend that we did create community did do some amazing things as sport. Those things are really wistful forwards. Yeah. Wow like talk about a company that was an absolute. Shit show in in. So many ways completely insane like the things that happened. In those walls crazy. But. If you think about. Could have brought together thousands of twenty, four, twenty, three to twenty, seven year olds who are starry eyed dreamers believing that they can instead of working for a hedge fund or something like that. They can work for the startup and maybe changed the world a different way. It's amazing to me that Carl is so nostalgic for his time at we were. He told stories about throwing out used condoms and dealing with aggressive customers on this podcast but he loved his time there clearly. had. Guys Yell at me for the stuff. Guys threatened to beat me up I've had so many things happened to work. It's nuts I've had to call the cops more than ever have my entire life we work but. At the end of the day, it's just I mean the the stories I have connections I made. One, hundred percents worth it. What do it again? Yeah. I mean. I would probably drink less alcohol but. What I do it again. Yeah. Of course it would do to you it was it was absolutely nuts. And Carl wanted to remind us that at the center of it. All was Adam guys his company. He built this from literally built us from nothing. He convinced scores of investor to give him billions be billions of dollars to do whatever he wanted to grow his company and says. Cookie visions is crazy madman. Thing and we filled buildings. On like hopes and dreams. Everyone has a lot of hatred towards him. You would have had the job to begin with was for him. This was a whole company with more than ten thousand people working for it. But. For almost a decade, it was centered. So completely around the vision and personality of its founder Outta. The Myth of the founder has been such a potent force in Silicon Valley. People idolize. Guy Is like Steve Jobs Jeff bezos and Elon Musk. Think about all the best selling biographies, even the Occasional Hollywood movie. There's this idea that founders had this special vision that no one else can really grasp that the founder can do. No. Wrong. And that myth gives their opinions incredible wait in their own companies. I think that Adam Newman is changing that. He may be remembered as the founder put a dent in the founder myth. In the end, you works demise come bigger than the company itself. The company's Bust may signal the end of the party the death knell for this Unicorn moment where people thought that if you could just get your company big enough, don't worry about prophets. If you can just get big enough, everything will work out. Foundering is hosted by me Ellen Hewitt Sean. When is our executive producer? Cueva is our associate producer. Ray Mondo mixed the show today work million and Vanderkaay also bar are story editors Francesca Levy the head of Bloomberg podcast. This is our last episode of the we work season please stay subscribed in your feed. We'll have more exciting episodes of foundering in just a few months. Bird..
"matt levine" Discussed on Techmeme Ride Home
"A date that would actually fit in with what we already know about Google's timelines. This is neither here nor there but one of the newsletters that I read religiously. Every day is Matt Levine's money stuff newsletter from Bloomberg opinion. If you're not hip to Mat Levin or money stuff, seek it out for absolute gems in thinking like the one I'm about to read you. This is from Matt's Monday newsletter and he's talking about that whole uber buying. Buying Post Mates News, but also about the whole model of venture backed startups, using piles of capital raises in an attempt to bulldoze their way to monopoly rent taking. We've discussed this plenty of times before there was a whole generation of startups where the only way their business model could ever work was if they actually got to a monopoly environment in their market. That's a hell of a business model. Because quoting Matt. If you take that model to seriously, this would actually be a perfectly viable pitch to venture capitalists number one. We'll get into the crowded miserable burrito delivery business number two will grow our market share by charging customers less and paying drivers more losing a ton of money ourselves, but also causing our competitors to lose even more money than they already do number three. They'll hate that number four eventually they'll pay us a few billion dollars to stop or to acquire US number five. All we need is a few hundred million dollars to subsidize our losses. Until the competitors give in and by us, you can lose money every step. Step of the way and never convince anyone that you'll ever make money and still exit with more money than you started with President. Profitability doesn't matter future. Profitability doesn't matter all that matters is harming the profitability of an even more lavishly funded money. Losing Venture backed company that is, if you believe this model in the short term, it might be in your interest to acquire competitors and reduce the pain, but in the long term when you do that, you are demonstrating that. Lose money until we get acquired at a premium is a viable business model, so you'll be encouraging other people to jump into the sector without a plan to make money, and you'll have to keep buying them. You can't really believe the model venture capitalists subsidize losses for ten years, but not for a hundred eventually there has to be some sort of endgame. Possibly the end game is people come to their senses. The industry consolidates and the remaining players find a way to make money you can tell that is a good story selling a valuable product at a fair price or a bad one making monopoly profits from precarious labour. Possibly the end game is people come to their senses. All these companies shut down and we go back to picking up our own burritos. Obviously, if you're invested in the space, you are telling the former story, not the latter and quote. As. I said this is neither here, nor there as a segment, it's not exactly a news item, but it is the best thing I've read in a while that succinctly sums up. A certain tendency of venture backed entrepreneurship that held sway over the last decade or so I don't think that this model holds sway for new entrance today, but for the players that played this game. The game is still playing out. I'm thinking of the ex, but for ex model of startups whose only strategy was to go for scale. That's the model that is in the endgame stage right now, and the end game seems to be very much a classic game of musical chairs. The venture backers of post mates, one hundred percent played the strategy outright they won. They got a good return out of the strategy, but for everyone else. If the music is stopping now, and you don't have a chair. Finally today I wanNA share with you a product launch that has gotten a lot of chatter.
16 PA counties move to the green phase, Philadelphia and surrounding counties to move to yellow June 5th
"The Nokia and its surrounding counties in southeastern PA will move from red to yellow next Friday the confirmation of the move comes as governor wolf is also transitioning sixteen Pennsylvania counties in the west from yellow to green the latest from KYW suburban bureau chief Jim Miller governor wolf says a some restrictions are lifted in certain activities resume is urging people to continue to follow guidelines like social distancing and wearing masks one of these precautions is wearing masks some reason I don't know why and wearing masks has become politicized even though scientific studies have shown that it actually reduces the likelihood of spreading covert nineteen while some benchmarks the state said when they announced the color coded restrictions haven't been Matt Levine says they're looking at all day at like increased testing in contact tracing capabilities and modeling and they're confident lifting restrictions as safe as long she adds as people plan ahead and are safe in just like before just like you remember your keys in your cell phone before you go out at a mask and hand sanitizer to
Philadelphia and surrounding counties to move to yellow June 5th
"Philadelphia surrounding counties in southeastern PA will move from red to yellow next Friday K. Y. W. suburban bureau chief Jim Elwood reports the confirmation of the June fifth move comes as governor wolf also movie sixteen Pennsylvania counties in western PA looting Pittsburgh from yellow to green governor wolf says a some restrictions are lifted in certain activities resume is urging people to continue to follow guidelines like social distancing and wearing masks one of these precautions is wearing masks some reason I don't know why and wearing masks has become politicized even though scientific studies have shown that it actually reduces the likelihood of spreading covert nineteen while some benchmarks the state said when they announced the color coded restrictions haven't been Matt Levine says they're looking at all day at like increased testing in contact tracing capabilities and modeling and they're confident lifting restrictions as safe as long she adds as people plan ahead and are safe in just like before just like you remember your keys in your cell phone before you go out at a mask and hand sanitizer to that list at the suburban zero Gemma ward KYW
Philadelphia - 16 Pennsylvania counties move to the green phase
"K. Y. W. suburban bureau chief Jim our reports the confirmation of the June fifth move comes as governor wolf is also moving sixteen Pennsylvania counties in western PA including Pittsburgh from yellow to green governor wolf says a summer stretches are lifted in certain activities resume is urging people to continue to follow guidelines like social distancing I'm wearing masks one of these precautions is wearing masks some reason I don't know why and wearing masks has become politicized even though scientific studies have shown that it actually reduces the likelihood of spreading covert nineteen while some benchmarks the state said when they announced the color coded restrictions haven't been Matt Levine says they're looking at all day at like increased testing in contact tracing capabilities and modeling and they're confident lifting restrictions as safe as long she adds as people plan ahead and are safe in just like before just like you remember your keys in your cell phone before you go out at a mask and hand sanitizer to that list at the suburban zero Gemma ward KYW
"matt levine" Discussed on Recode Media with Peter Kafka
"Bunch of private companies that were a using this model yeah and Amazon is like the classic example like the kind of work that's kind of did like to first to an approximation. But then like you know Uber. There's still some doubt. And then we work is the sort of classic example right but there's a whole series of these companies that had been in very shorthand right ballyhooed more highly by the private markets. They go public and we works the best example of this not working but there are many were the public markets. Go No actually. We think these companies were significantly less than you did and it seems to be confusing lots of people in Silicon Valley and Wall Street because then theory you all these super smart investors. We think they're smart because they have a lot of money Who supposedly have a lot of access to the company? So are they misjudging something or the public markets misjudging. I mean in theory. This is how how capitalism is supposed to work right you you come to the price but but what accounts for that gap private values one possibility is that like venture capitalists. Were right right that in the long run this will be massively successful all right one possibility. Is that the markets are right and it's not won't be successful everything I don't know because in theory even if we can account for that gap you'd still think the guys on the private side go. Well whatever it is. We need to make sure that when we do go public. They're still more value here. We don't want to go public and become less valuable so we need to at least figure how to price it. Something has gone wrong with this. One weird thing is like they used to be that like you were private and you in public and evaluate up a lot like some sequence career but like that was kind of like you invest in venture capital and private companies with the expectation of like a multiple times. Return on your on your money because like you're investing in a lot of things most things failed and something's got to pass you know ten extra whatever. The modern set of tech UNICORNS doesn't seem to have have those expectations at their like later funding rounds or at least those expectations realistic so like when Uber was raising money at like a sixty sixty billion observing billions of dollars something billion dollar valuation. It wasn't going to go public at three hundred billion dollars right like you know. There's a lot of the like cushion. had been sort of taken out of this. Where like the evaluations got to public market level without the theory was that you could like there was higher valuation the public the market because it was more liquid and you had more disclosure there was advantages to investors in public markets? And so we're willing to pay a higher valuation and then just kind of went away And now investors in private markets are willing to pay as high or higher evaluation without getting any of the benefits of public markets. That's like one thing. That's just sort of weird in theory they. I still think there's going to be upset or not. They expect to get a return. Yeah but now we're learning. They're not yeah or they're getting richer but it's not what they wanted. So let's let's I keep saying we're GONNA talk about. We were talking about we work. So is we work the best example of this breaking or as we work so particular to we work that we don't really and then it's another version version of this as we work the problem with founder controls a private companies is. We work the problem of Softbank. Not really knowing what they're doing or as we were just so particular there's actually no lesson to learn from we then it's an amazing story. I don't think that we work. Is that the business that bad to me renting office space. It seems like it seems like someone should be like the thing that they're basically doing which renting offices subdividing them doing a time are like they're renting an office for ten years and giving it to you for like Mike Von Month the month super sexy but it's business seems totally reason why I'm like you know and they're like we do like we have a good like you know. Office management functions. So you're outsourcing your office management function to us. Offices are cool..
WeWork: Unicorn Cowboy
"He's speaking here in January of last year at a conference of mayors at the time we work was worth more than twenty billion dollars an extraordinary amount of money for an eight year old company that had never made a profit and was in the business of renting out office space by the month but newman never really talked about. We work as a company that rented out office space. Here's I would he told the mayor's if you bring us in for ten locations we will create one hundred thousand jobs over the next ten years and it can go go bigger and bigger and we wanted just bring your jobs. We'll bring the place to live. We'll bring education and this is important will bring corporate America we will redesign their space build it deployer technology which is called we always and took okay longtime to create and then put our community where you do that for a city hall. I would love to see the whole this is the way newman talked about. We work and we work talked about itself not as a company that rented out office space but as something much bigger we kept opening more offices and more cities and kept losing money and investors kept giving the company more money at higher and higher valuations by the beginning of this year we work was worth almost fifty billion dollars because it wasn't just an office company it. It was a technology company that was going to figure out how to profit from offices and apartments schools in City Hall and basically everything we were like. We're going to be a universal. They don't know what the word is. Universal Place Company Matt Levine used to be an investment banker now he writes for Bloomberg opinion my favorite of his recent headlines it's not you. It's it's we anywhere. There is a place we were going to be taking money out of it. That's why they could raise money at forty seven billion dollars evaluation. They weren't like an office landlord company. They were this flakes everywhere all encompassing master of space at least that was the story we were told up until this summer until to put up finer point on it just after seven. Am Eastern time on August fourteenth we work was preparing to sell stock to the public for the first time they have an IPO and they published a document for prospective active investors. The document is called S. One Thursday really quite extraordinary turning point like everything was one way and then the as one hits and immediately everything is the opposite way in like shockingly rapid fashion that whole story that we were had used for years to raise more than ten billion million dollars from some of the richest most experienced tack investors in the world The story that made it the most highly valued startup in America back collapsed instantly instantly. How did we work raise so much money? How did it go so bad so quickly? What tell us about the way money works in the world today hello and welcome to plant money? I'm Jacob Goldstein. The story of we were long rise and almost instant fall largely goes back to one guy not Adam Newman not even anybody at we were. It's a guy named Masayoshi sun today on the show. We Work Masayoshi Sun.
"matt levine" Discussed on Security Now
"As we are continuing to plow into our fifteenth year with no sign of anything leading up in fact this week's podcast is titled the ransomware epidemic because a security firm anchor armor has <hes> been tracking what's been going on with ransomware. We of course have been talking about it more over the last few months than we ever have. <hes> and in a number of things have happened that sort of bring this to the floor <hes>. We have a little bit of news from texas. That's been surprisingly quiet thirteen. We knew victims last week the emergence of a well okay. There's a new ransomware awesome where known by two names. I posted to my twitter feed this morning. How do people think i should pronounce this for the podcast s. Oh d. i n. O. k. i. b. i. and the consensus kibi well yes after we decided it was so cheap so it's probably it looks like his japanese so often what we thinking yes so anyway rather than looking at lots of small bits of news as we sometimes do when i've talked about like what what we're gonna do and it just goes on and on and on we're gonna take a longer look at a few larger topics we <hes> examine several pieces of welcome <music> news from the bug bounty front will also take a look at google's project zero revolu revelation of a comprehensive multi-year campaign aimed at i._o._s. visitors to specific websites and then probably we were we'll conclude but with probably at least half of the podcast talking about this distressingly large array of ransomware news which suggests that we're in. We're heading into a new era. I mean we've sort of been teasing at this for the last few months while we've been looking being at these municipalities that have been hit by major ransom demands that have been met thanks to them being insured which of course cert- changes the dynamic of all of this so i think of another great podcast for our listeners and a rather sobering picture the week which will get to a minute yeah yeah <hes> our show today brought to you by cachefly when i say brought to you by cachefly. I think many of you know <hes> <hes>. That's quite literally brought to you by cachefly. It's our content. Delivery network are c._d._n. And we've been on cash light pretty much as long whereas the show has been on the air as long as twit spin around in the early days of security now and the other talk shows <hes> we just you know you could download it from our website. <hes> <hes> then when the audience numbers started going up and up and up and i couldn't afford to do that. We tried bittorrent for a while. That didn't work out all that well finally. I was very grateful. Matt levine cachefly heard about our woes was a fan of the shows and said let me help and this is a relationship has been going on ever since you need a c._d._n. And if you deliver content to customers if <hes> if your website is directly tied accompany.
"matt levine" Discussed on Capital Allocators
"It's mainly secondary. It's not for financing purposes. Buber still burns money like they'll probably take some money. Let you take on increased computerization and quantitative methods of investing on the long view pretty optimistic about the ability. There are people who are real deep skeptics about driverless cars, and I don't know about driverless cars to strive you on where but it sort of seems like, you know, just casually consume the news that cars have made big advances and kind of drive and like to me it's gonna be a lot easier to pick stocks than to drive a car for a computer computers. Like, there's a lot of data about stocks. And like, I mean, it's harder for human share like humans. Learn how to drive like literally motor. Her skills visual discrimination that is really hard for computer to do. And if you do that like, surely, you can look at a giant pile of data and be like, this is the data that just Just you like can. you can get a visual field and be like, this is the visual data that means I should stop head of child. Right. You look at the pile of data. And this is the stock data that tells me I should buy this because it can go. It just seems like how hard can this be? I think that we're in a world where it's hard for active investment managers to add a lot of alpha in liquid Lee traded on the run instruments and part of that is explained by like the dumbest simplest algorithms, which is like you can use by index fund then you can buy the slightly smarter algorithms like smart beta things that like say there's one tweak to it to make it a little better performance. And so like here like a mutual fund manager fifty years ago, if you like track the indexes fine now if you're a mutual fund manager like the most the time beats you that's the statistics. Even if you beat the index, what are you doing? You're buying value stocks you can buy value index. Right. Like, there's a lot of and then like you layer on top of that smarter strategies the room for humans to perform in like gut instinct to Evan pick. Of liquid investments just seems really really slim lose other staff activists, right? It's harder for computer, if you and activists heart if your computer to do a lot of like liquid or private stuff, but the public markets are going to be commodities by computers. I think I think that you made the transition from investment banking journalism and fields related in what you're writing about. But it's quite a different role. And what you're describing has some implications for the number of seats at the table of those kind of traditionally end investment business. It does. Yeah. There are a lot of businesses that get very technologist and bigger if you can get particular kind of beta from a factor ETF one thing you can do is like fire all the people that were like doing that strategy. Even you do is you build a team that sells like a more customized portfolio of you can use it as tools or inputs into higher value add product, right? And I don't know how that shakes out in the investment management industry. I I think a lot about you know, as a equity derivatives guys Bank. Great in the not too distant past equities recreated by calling up a Bank and dealing with them directly on getting paying them in eighth to buy and sell shares. And now, basically I could easily traded by computers most part, and so all those people are gone. But what that did was it meet it really efficient to trade equities. And so like, the equities business at banks is large and has a lot of people and makes a lot of money because it's not like just buying stocks. It's like selling structured equity derivatives where the ability to dynamically hedge them my like tapping a computer and being like you're going to buy shares, according to this algorithm. And it'll be basically free has made it possible to do those rivers which are much more profitable than compare and profitability to buy stocks. So you can imagine something like that in the investment industry where the picking of what stocks to buy a large cap stock portfolio has just completely outsourced to computers..
"matt levine" Discussed on Capital Allocators
"So that the CDS doesn't pay off the ones around the through sold CD has we'll do that other times. They'll be like, hey, you should issue. A lot of bonds in your old devalued subsidy just making kosher, and then our CDS will go way up in value. And we'll give you some of that value to and there's other stuff like this. So it's like become a. Playground for clever. Hedge fund people to think about structure rather than this. Pure bet on credit quality, independent of all these things. I'm not that bothered by this for a couple of reasons one it's like many of these stories result in companies getting cheap financing. And it's like, well, you have this terrific does market coming in and ask for it is just like grew up independently of these companies and the companies like, hey, we're going to extract some money from that derivatives market. That's kind of cool. It's like a story of the triumph of regular corporations over Wall Street capitalism. Another reason I'm not that bothered by it as that. I think it's a mistake to think that there is this pure bet on the credit quality of a company the company is going to default or not to fall not just based on that schedule. But based on like, whether it can get refinancing or whether it's lenders will extend its loans. That's a question that is not surely economic, but depends on its relationship with the lenders. And this is just the sort of expansion of that where like the creditors are making decisions that are about their own. Health interests and not just like a pure objective default decision. So all this stuff people find it sort of shocking because it feels manipulative it feels like negotiated and weird and back room. But like it's kind of a credit is so it doesn't bother me that much, but people complain about it a lot one thing that happens is people time when these things happens read quotes about how this is going to be end of the CDS market. And it's not, but the same time it does feel like sort of diminished compared to like where it was before the financial crisis. So I think people are very focused on making it a little bit less surprising. And there's is though which runs this just announced the new like a change to the CDS documentation to eliminate one of these prizes. So, you know, they're working on it. Maybe it'll happen. Maybe it'll be some somewhat less surprising. But it does feel like it's all these questions are always going to be kind of fought over and negotiated. These what happens when a company runs out of money. So there's only so much room to improve it. Take a step back and talk a little bit about. Some of the key trends and markets in general, the first being moved into money to pass vehicles and index funds. There's a lot of that is a really interesting set of corporate governance questions around passive, there's sort of an intuition about what like a hedge fund manager, even a mutual fund managers should do with the companies that he owns they should make sure they're making money in like, call them up and yell at them if they're doing something wrong. And like maybe starting activists campaigner supporting activism whole lake if your investment manager who analyzes companies in picks a relatively small number of them to invest in and monitors them closely. You have a relationship with their governance that makes kind of intuitive sense if you're vanguard and you're like the biggest shareholder in whole bunch of companies, but no one picked them. No one follows their financials. It's just weird to think about what you should do there. When thing is you see a lot of the big passive fund managers. Spend a lotta time saying, we're not passive and governance. We care a lot about. We really focus on this. Now seems unlikely that that is primarily organized around financial performance. Right. So you're a activists henchmen mad. You're you're mainly interested in like can the company make some changes that will make it more money. If you're vanguard you can't process that question for thousands of companies, you don't have industry analysts for a lot of those classic index..
"matt levine" Discussed on Capital Allocators
"It's expressed as like you have this money, and you should invest it in like building stuff in the business rather than wasted by giving it back to shareholders, which I think is a sort of strange bias to have. And like if you look at the long run of how by backs happened. Basically, what happened isn't the seventies and eighties? There was a view that corporate managers liked to spend money inefficiently and to aggrandize themselves and build empires. So like there's this wave of conglomeration like manager. Like, oh, look, we have money, we should die some more stuff. So we can have a bigger headquarters, and I can run a beer company, it'd be more famous and as a corrective to that shareholders got more interested in having companies return money to them. So they could decide how to invest it rather than having the company's inside out invested and. We've now perhaps sewing too far, but also like the rhetoric swung too far. We're now it's just assumed that the worst thing companies can do is give back to show. There's now there's arguments for that. Like, the Cheryl there's often like the managers on a lot of show them boosts their own compensation and so forth. But the sort of original notion that returning money to shareholders disciplines managers and allows and prevents them from wasting the money is then lost them. We've kinda gone the other way, which I find kind of weird can we take it away from the pure corporate side, and I want to get into market total bit you've been writing a lot about what's happening in the CDS market. Start with we're the CDS mortgage started where to say where you think it's going. So CBS is a contract that allows you to bet on the credit quality of companies see this is a country that pays off when a company defaults on its debt pays off basically the amount of money that theoretically pays off the amount of money would have lost on default. So. You started. You could short bonds you could borrow on and sell it short. And then if the company default that the value that bond go down, and you'd make money, right, but CDS has advantages over that one is that it's kinda hard to borrow bonds. Like just kind of locked up. Another is that it allows you to make sort of generic bet the company rather than picking a specific bond to bet on. So you'd have more liquidity his you're sort of one CD has contract on the company rather than a much different bonds. No things like there's there's someone on the other side wants exposure to the credit of company, but doesn't have the funding to buy the bond can buy the CD us. There are elements that make CDS as a contract a nice way to bet on the credit of the company, but it is different from just the bond. And so it's happened. Now is that a bunch of people who found ways to more or less drive a wedge into that difference to say instead of just being like a pure bad. I'm outside facts in the world by the credit. Company you can like do stuff to make that CDS contract. Pat, in a way that the bond would have paid out and these are often talked about is like some prod CDS shenanigans, but there's a bunch of different things. There's no real coherent single thing. That happens. Like one thing that happens is that hedge funds will go to companies and say, hey, if you default on your bonds like just a little bit like just don't don't pay one bond like maybe one that you own. So you don't don't even get mad at you. He's like do a default on your bonds, then our CDS will pad, and so we'll have money these hedge funds have CDs. So we'll have money, and we'll give some of it to you. And they don't say like that. Because it sounds like a bribe. But they'll be like, we'll give you a beneficial refinancing. We'll refinance your dad at some more favorable rate to you and will subsidize that with the Pat on our side..
"matt levine" Discussed on Capital Allocators
"What you thought was interesting and fun in a way that you thought was interesting and fun rather than serving anyone else's purpose. At all. Did you have both that kind of business lens of what is this as a business? And then also the journalistic angle when you started. No, it's a very small company. So you think about things like that? And y you don't Goldman, you know, go, man. Yeah. They'll probably they'll make some money somewhere. Also, I was like selling things that golden. But I don't have Bloomberg Bloomberg. I'm not really that worried about like the business. Someone else takes care of business. Someone else took care of the business of difficulty. But it was a much smaller company, and you sort of like sat in the same room as the president of care the business. We had to do a little more thinking about like how the thing was paid for. So the dramatic reading night, we sold tickets, you know, like thinking about like, we can have an events business, but not any like are they structured way. There was a business side who did the business. I did not do the business job at used to your little closer to it than headed. The transition. Bloomberg come up you read on the internet. People can read it. It's nice to talk to them about coming there. And then they hired. I wanted dive into a bunch of topics. You write about before we do that kind of fascinated about your writing process because you put out so much. In fact, I find it hard sometimes just to keep up with reading what you put every day, and you're writing it. What's the structure of your day? Look like, the real structure I wake up and right in panic until I'm done, and I sent it to editor. And then I signed it up. Oh, she you start the day. Yup. It is starts at like five. AM? I wake up I have like some stuff collected for that as many stuff. Sometimes I've written a section mostly I've collected links sometimes written two seconds. But know, it's mostly like pretty Bill formed, and then I sort of sit down and write it from five am to eleven am with some time to get my daughter after school and whatnot. And then around eleven I sent it to an editor. And then it gets published at noon, and then usually like go into the office, and then from sort of one till five I like look for other stuff and start writing stuff and have lunch with people and complained to reporters and do all the job stuff that isn't typing. The thing he mentioned you start writing at five AM. Do you have a place acre house that you just coordin- off and your daughter's asleep, and you just roll out of bed in sharp writing? You know, usually do the crossroad I, but I think a progressive nation technique gotta wake up. Yeah..
"matt levine" Discussed on Capital Allocators
"I didn't really understand what the job was until I got there. It was like structuring equity derivatives and doing convertible bond underwriting, which like. He told me that. I just think it's impossible to know what that means when you're in Manila. So I went and did that as a very strange field. Like, no one leaves during the else after I left years later recruiters comment. I was like a journalist who recruiters commie and be like do you want to head up convertible bonds like some investment Bank because there's no one who does it and everyone who does it just keeps doing it at rotating between banks, but it was like a good exposure to a lot of things I was like pricing derivatives and like thinking about options math in Greeks. But also like your corporate Ecuador that is not really driven by finance their different by taxes and accounting securities law. So like, I was learning a lot of stuff about those fields. And I was working with investment bankers hanging around emanate deals and underwriting 's has also working with traders and sort of seeing how they thought about risk. So it was a good exposure to a lot of different finance things. And I was like good at an early on. Because it was a lot of structuring and thinking keeping track of stuff. And then as I got more senior it became more about selling. And I was worse at that. So I have actually got pretty bad at my job into the Mike doing it. And I thought I'd do something else. And so we're less quit to go right at dealbreaker, which is this financial gossip blog financial blog. I don't know how long did you go from being the junior person keeping track of stuff to more senior in a sales -i kind of position is like a second year associate and I left as like a second third year. VP that's a mix all the way through the MD's on my desk, really actively involved in structuring stuff and the associates would occasionally pitch deals, you know. But like I would say that as an associate I was mostly compensated and evaluated for my technical skill in as a VP has mostly compensated and evaluated for myself scale, some crossover much Showtime where Coleman for years. So now, we're onto dealbreaker the gossip that's not really the right word. But I don't know. It's a humorous, Wall Street blog, and sort of vaguely thought I could do that. And I didn't really know what I was getting into but head you make. That transition this sort of did it, so I really didn't want to be a banker anymore. So I went to my boss, and as I do this anymore. This is before I had a job of doing. I someone do this anymore. And here's like, what are you going to do? I'm going to quit. And like think about it for a while. And he said, well, don't quit now just take some time off and take a sabbatical Feo. You wanna do nice of him? And so I went back to my desk. I was like I'm gonna take two months off. And then before I was able to do that dealbreaker was hiring. And I sort of knew people their friend who worked for they're above the law, which is the law bog there. And so I applied and as a guy coming from Goldman, they knew me they knew like a decent person. And I tell people there barriers the hiring me were pretty low because like they don't pay that much, and I was really bad at it, the commenters it'd be really mean to me, and I would quit in a month just sort of had happened before. So they they're risk was pretty low. They just hired me. And then I went back to my boss, and I was like never mind. I'm actually quitting for a job. And then they were there were a little nervous that has gonna deal, right? And to what was that experience like? It was really fun me and best Levin. Who's like not exactly the founder of minutes behind the site. Is like reject that. It was our art project is like extremely hands off. And I kind of did it we want. We do what we find funny at some point. We decided that that'd be fun to have dramatic readings of old Tilburg posts. And so we hired an actor and like rented a bar had dramatic readings. Yeah. He's a good completely structure lists environment..
Lyft Going Public: The Dual-Class Share Dilemma
"Lift the company is busy filing all kinds of papers. And as part of that they announced that they are planning to issue to kinds of common stock class. An Cosby Matt LeVine is a columnist at Bloomberg opinion off of my worst cost really. Yeah. Well, it's like the normal one. And then class b is the weird one the stall key by on your e-trade account class-a stock? It's your plain vanilla stock class b stock. Well, no difference really on the face of it usually worth the same price part of the same company, but one key difference class as talk has one vote per share and Cosby's talk has twenty per share in the case of lift one share of class as stock get you one vote and one share of class b stock gets you twenty votes twenty votes, and that is today's indicator twenty that is the number of votes as single share of lift class b stock will get you would get a B class stock founders in the case of lift cO, finders Logan green and John Zimmer and nobody else. So what is up with these class b shares? Why would the founder of a company do this? Used to be that way us hope sock was like you had to give up voting control your company, but that's not what he wants. He wants to keep control of his company, and it turns out because is willing to give him money, you know, for stock without demanding control of his company. And so he takes it takes so back in the day. You took your company public you sold shares to the public, and there was this tradeoff on the one hand, you all this money on the other hand, you give up some control of your company. So if the shareholders did not like what you were doing they could vote you out you could be out on your ear. Also, if you wanted to do something fancy with the stock they could stop you so CEO's, especially Texas started using these class b shares to create stalk with the super voting par giving themselves a ton of votes. So that they can maintain control of the company they get all the money, and they keep all the power a win win. And then the situation the power never trickles down to the people. If the finders sell their class, b shares the buyer of those shares. Does not get that twenty vote deal. The shares usually convert to class eight years a crummy single vote. So why would investors put up with this? I asked Matt living this question. And he said there were a couple of main reasons the first is that these companies were just so hot people wanted a piece of them so badly and investor said, okay, and they surrendered their usual rights. But there was another reason a lot of investors started to see it as a plus when Facebook went public CEO, Mark Zuckerberg, a tiny group of insiders got a ton of these class b superhero shares which essentially meant the Mark Zuckerberg had complete control of Facebook. And when the company went public the Wimpy class A-Shares traded really really, well, it was super popular. But Mark zuckerberg's outsized power. Also, ended up paying off for investors because good example of the successes. Mark Zuckerberg did a lot of move that were kind of look like weird corporate. Governance like, you just went and bought, you know, whatever it's like little oversight sort of felt like a sort of a company that was not like run by best principles of corporate, governance, necessarily, and it turned out to be wildly successful for shareholders. And they put loads of money, right? Because he actually was good at it says a lot of investors, especially investors in tech companies with these celebrity genius, inventor of CEO types, actually started to really like the fact that shares of stock came with no voting muscle became kind of like a selling point like don't worry. No, slutty small-minded investors going to step in and Swart, you know, the geniuses vision. Which is this is actually as you. It's protecting your investment in no way. Because like what you're really signing up for is Mark Zuckerberg and the only way to make sure that you're getting works to all the votes. Dougal Lincoln groupon. They old it. But when Snapchat went public Matt says that was kind of the peak for class b shares not. As a even weirder version, where public shareholders have no votes at all. And only the have any votes. Hey, why not let the suckers by the shares and not get any voting rights Snapchat? This moment, though, is when the markets kind of struck back at the whole class, b shares idea the keepers of some of these big indexes like the S and P five hundred decided enough was enough said, we're not going to list companies that have so called dual class shares and the excluded Snapchat. Now, this was a big deal because of index funds. Now, those are funds that are pegged to an entire index. For instance, the S and P five hundred so with the S and P five hundred goes up the index fund goes up, and if you have money in a 4._0._1._K a lot of that is probably in index funds. We are talking trillions of dollars and these index funds will not invest in your company if it's not listed on the index. So getting excluded from an index like the S and P five hundred means that you are. Leaving a lot of money on the table. But the index is like, okay, listen, we turn to blind eye to Facebook and Google, but Snapchat, you've gone too, far you want the money, you cannot keep all the power to. This is a breakdown of the whole system you wanna take people's money. You have to answer to them. And we're Matt LeVine heard this. He thought will is it jewel class. Shares are over the time has come to an end year ago. I would have said well, the fact that the indexes are down as early about fine for the continuing viability this, but no turns out. Along comes lift at the sides, no index funds for us. But so be it. This probably means that lift won't ever make it onto the S and P five hundred index, but they did this. Anyway, they said we want control so much the will willing to give up this a lot of money a lot of money the jewel share model class. A and class b shares not dead yet, extremely popular and becoming more popular among tech extremely unpopular and becoming more popular among big public investor's attention. That's why the indexes are dying because the public because behind more popular public investors like every comes to market once I do class stock, and it's terrible. And we hate it. And we got to do something about it was like one or two when it was like Facebook. It's like fine whatever, but every company has its come frustrating for investors. If your stock is hot enough, and if you are enough of a cult of genius techie type, you might just be able to have your. Go public and control it too. And in fact, there has been such crazy demand for shares of lift even though they're not available yet making money, and the companies actually losing money inspect it doesn't make anything that there's speculation that when the company goes public. It will actually exceed the twenty three billion dollar valuation that put on himself twenty three billion dollars. This is cold having your cake and eating it too.
"matt levine" Discussed on Front End Happy Hour
"Is about moving resources from the future back into the present stock prices reflect catch flow into an infinite future. Like, I mean, it's just poetry. But it's about some something really boring, but he just like illuminates financial matters. Like, so well, if you ever see his name on article it's worth reading like absolutely say his name again. Matt LeVine, Bloomberg Michael Woody have fair listeners. So I came in unprepared for the so-called picks topic sick, you know, as my wife always said says, it sucks to suck. Let's see. So as far as scale I'd say that something that I have thoroughly enjoyed as of recent is being on the other side of fatherhood. I know that's kind of a weird thing to pick. But. We've all we all grew up with or without a father. But we had a father at some point like you unless crazy sciences recently happened, which I don't think it has you pretty much have to have a dad at some point. And so growing up personally without a present dad and being able to be on the other side like that's just something that I've been diving more and more into in realizing things that I will never understand from one side. But I can understand from another perspective and just something really awesome about that. So few have obviously a kid in your life. It's a good choice to invest more time than you think it's worth like the time doesn't feel good now. But it does feel good retrospectively. And then the second thing is I really enjoy investing time into live stuff. Gems laughing. But if you ever I I'd say, especially since we're this is a large engineering or primarily engineering audience is that a lot of people don't take the time to sharpen their speaking ability. Not just simply performing in front of a group of people, which is giving a presentation of presentation you prepare for you say it over and over again, you make all these slides whether they're good or bad doesn't really matter. But you give a performance you were an actor on stage. And you may be bad. You may be good. That's different than attempting to practice the art speaking. And so taking the time to have more of those in your life will benefit you long-term much more than you realize at the moment. And so talking like, I knew someone that every single day they would wait in a parking lot. And wait till the next person came and would actually get out of the car at the same time and just speak with that person on the way to just simply to get better at talking to strangers because they said that the number one fear they had. Talking to strangers. And by the end of the semester, they were very comfortable talking to strangers like finding ways to exercise that live interaction and speaking, and so that's my other pick is investing into the future via it via conversational arts. Also, stocking people in parking lots of pair. That's called stock in most. Yes, guilty that don't don't actually wait for the same person that soggy if it's a repeat person than. Oh, yeah. It's all this is all right. All right jock. What do you have for us Jim stole mind? The talks I was going to just pick kiss talk. Yeah. Okay. Well, I will I'll plug this of them. We did them as a trio. And it was I think actually a pretty good lineup. We head. I think I went first then Michael then gem, the I think the set of them actually speaks a lot. The set of those talks speaks a lot to what we were talking about today and goes a little bit more into into depth in some of the more specific cases. So they're they're worth a watch one point five x speed them. If you are short on time, but they're they're a lot of fun. We had a lot of fun putting together and putting it on. And if you're in the area in the in the bay area, definitely check out the Netflix tech talks there. Well worth coming down all the way to Los Gatos for which is a long haul..
"matt levine" Discussed on 10 10 WINS
"To sixty degrees. Going down to forty five tonight. Good afternoon. I'm Larry Mullins wins. News time at the tone, five thirty. Good evening. I'm Laurie Madden. It went down to the wire. But democrat Ned Lamont was declared the winner in the Connecticut governor's race this morning, really. State. I start and this is the first star. And I think you're gonna give a Connor. The difference. We gotta do going forward. The businessman spent twelve million dollars of his own money in that race. Attorney general Jeff Sessions is out. He sends a letter to the president today thing that at the president's request. He is submitting his resignation. She talked about how being at the Justice department has been an honor being at he is done his job to the best of his ability ABC's, Matt LeVine, President Trump repeatedly attacking sessions over his refusal from the Russian investigation, the new man in charge of Justice. Matthew Whitaker had been chief of staff to sessions. The announcement. Obsessions departure coming less than twenty four hours at the midterm elections. Democrats will be taking control of the house. Democrat Nancy Pelosi the presumed speaker come January and says the people have spoken yesterday selection was not only vote to pretend. Talk. America's healthcare was vote to restore the health of Vaga mossy, and as far as the White House Democrats on the house oversight committee have already compiled the list of sixty four subpoenas and inquiries into concerns. They had with Trump administration activities. Dave packer. ABC news news time, five thirty one from.
"matt levine" Discussed on Slate Money
"What we have seen since nineteen eighty there was a lot of value created in the global economy up until nineteen eighty from the industrial revolution all the way until the mid twentieth century and it and we manage to do that as a global society by using financial capitalism yes but not to excess and then in recent decades the growth of finance has outpaced the growth of the economy and most of what has happened to the world of finance has been in that ten is phrase social useless it's financial people moving money between each other and lending money to real estate and basically not really making value in the economy i think see that with the brain i mean tobacco up the pope argues for regulated markets and you yourself just said that's a good idea and we see i mean just this week that we are moving away from that idea and i think that's problematic that's got us into trouble you know a decade ago so that's first of all second of all i think it's true that find the finance industry has blown up to sort of into an obscene kind of place where i mean matt levine has been covering these credits of all swaps that have manian is using that are just like insane it defaulted on its own debt in order to pay out cds for blackstone or something it's just you don't have to be like a finance wizard to read about that and think hick it's just like you know it's it's it's it's money out of nothing it's just gambling it's not finance does serve a purpose to you know fund companies ininvesting companies but this isn't.
"matt levine" Discussed on Slate Money
"Okay let's talk about the pope yeah okay so so he came out with this long thing he put it on the internet in some weird language what language was so i was describing it to a friend it's like if you took every speech that bernie sanders and elizabeth warren gave in the last ten years put it in a blender then translated that into latin than translate that back into english using google translate you would get this that's accurate i think that's how it happened it was like people try to find the original latin and the couldn't i mean matt levine was looking because he's a classicist yet she can relax he's like maybe this will make more sense in the original you couldn't find original it's so bizarre to read 'cause you're reading it and then you're like wait is he talking about payday lenders it was so it's very weird thing that reminded me most of widdly is this thing called international art english knows a wonderful saying triplecanopy you should all google it and and read triple canopy essay on international english it's basically the language of aunts gallery press releases which no one knows what language is this is a little bit the same it makes the whereas most railing against the capitalist system love to be very blunt and plainspoken this is just the opposite of that but should we say what it said does rail against the capitalist system and this shouldn't come as a great surprise to anyone who understands who this pope is and where he comes from in argentina and his theology but he is a genuinely anticapitalist pope yeah it was interesting to me reading because he seemed to be trying to make this distinction between the good real economy and the bad unethical economy right the the real economy of.
"matt levine" Discussed on Slate Money
"What you can do is you can go to ziprecruiter because they up professionals they depend line exactly what you're looking for they can identify people with executive rights experience for you they can invite those people to apply for your job and they can revolutionize how you find your next high they really amazing tool for finding exactly the right people to help you'll company jeff get fabulous and allowing you to concentrate on running the company rod two piles of resumes that's ziprecruiter job thing of all to be honest about ziprecruiter is it is completely free you can try it out the nothing if you go to ziprecruiter dot com slash money that's ziprecruiter dot com slash money you can post job you can get a whole pool of qualified candidates only within one day you couldn't find exactly the people who are going to make your company better and bigger and more so than ziprecruiter dot com slash money for absolute free ziprecruiter the smartest way to hire okay let's talk about lawyers this is this is the put matt levine on the spot segment of slate money matt you are lawyer i've been a little over a year and a half at a big law firm in a columnist for seven years i was an investment banker for for years but you gotta law school you gotta love for him for like a minute stays with your life it really does you know when everyone says you know what percentage of members of congress lawyers whatever they don't actually though is that members of congress but they still cal once once you have a law degree you are lawyer and you left law school and became a sort of big law lawyer and then you left big law to become a banker at goldman sachs we may have had fan and then you left goldman sachs to go become a blogger laga which is a then career natural career progress.
"matt levine" Discussed on Equity
"This morning matt levine in money stuff the best my favorite newsletter of all time wrote the trading range for spotify shirts has dramatically tightened post drek listing composure it's private market trading beforehand so now it's employee is not only have easier access to liquid today they also have a much clearer price and so they know they're probably get a much more reasonable dollar amount per share for their equity they've created so i think that's something that i didn't really realize it was going to happen before the reckless liston on in fact i would have guessed be even more volatility again proving what i know but certainly you know they went from a fifty to one thirty range in the first couple months of this year to like a one thirty five to one seventy which is a much smaller you know various ranch that's right and you know part of it is because in this you know private or pre ipo trading market there's lots of different avenues for people to try to get stocks some of which the people can give people you know some reasonably good visibility in the company and its performance and other avenues which frankly people by holy just on the name and so that clearly is going to cause some despair in the pricing because suma belief you all you get is the name and you don't have all the you know actual financial information or at least decent visibility into it you're going to be a little more you know less informed in the way that you would buy in price the stock and speaking of transparency into numbers docu sign gave us a bunch more this week if you recall from a little bit ago docu sign giants one and then didn't have the last fourteen months financial performance in it so we were all confused and we're looking back to kind of.
"matt levine" Discussed on The No Film School Podcast
"We told them yeah we've sort of really we've got our cast we've got a lot of our crew ready to go and hit the ground rolling running rolling but we need like we need the money in our bank account you know next in the next week so you know and so they understood that and they made the decision very quickly would give a quick shout out to matt levine because over at netflix who really was quick and very supportive and we had a lunch with libby where she really kind of laid out an amazing vision and he he got it and immediately activated which very few places can do so quickly it was really really nice since you've just joined us to quickly introduce yourself hi i'm brian on kalisz role on the film one of one of the producers awesome okay so now netflix on born and i'm curious before we get into the craft of making the film which is which i'm so excited we have a bigger piece of the crew here i'm curious like what they what were their mandates came together so quickly was there anything they said about how you had to shoot it or anything the most amazing thing about working with net flicks is how much creative control they give the filmmakers i cannot i can't speak more highly of working with them i really i never got annot from them on anybody that i wanted to hire any of my casting decisions we hadn't yet cast the coach so they had we did have a list of actors that they said you know if you could get a big name actor for this role would be good but you know if you can't read through somebody else you prefer you know that's okay too and everybody was so happy with the choice that you know getting coleman.
"matt levine" Discussed on Bloomberg Radio New York
"Blogger at mlive go on the bloomberg said we have been touching on a bit the fact that bank earnings will start on friday and there were expecting somewhat lower trading volumes laura keller financial puerto for bloomberg news had a wonderfully colorful take i is sort of the effects of slower trading activity at banks including lots of swiping tinder and leaving early for a variety of events laura before he came to the color of it all i wanted to just get a sense of where the slowdown is happening most emily heard yesterday i'm from kim bianco of beyond korea search that a lot of traders have trading apps on their phones it's not just that they're leaving inkling to the beach source are and certainly we know any traders we don't want to keep you have not been able to do your job when you're on the golfers are of course that's only part of your tap right no he's not about insane not bnss it's the reason people are not in the office is because there's not much going on so certainly it's it's volume problem me no actually look at treasuries if you look at equity is if you look at the corporate bond market there really is just all down and that's kind of our seen i think there are certain in markets and that are a little bit better off seconds and rates traders the other dan you know they're seen for the third quarter anyway the last week or south things picked up somewhat so certainly there are pockets but we are waiting for the big banks kind of let us now when we here on all these earnings 'cause you know what they are seen is that going to be something like jeffries said hey emerging markets as a little bit slow frasque leverage credit where we're bag that was slow or or is it gonna be different because as we know every one of these big side banks has a bit of a different kind of trading franchise specialize in different products i had a really big laugh this morning when i was reading matt levine's money staff his daily at the compilation of stories and he quoted a passage from your story i in particular one bomb trader says he's been slipping at early to watch his kids play sports and matt framed this as this is apparently bad and then he talked about how people are saying well you know there's.