The Compound and Friends - For Blood and Money

Episode Date: January 27, 2023

On episode 78 of The Compound and Friends, Michael Batnick and Downtown Josh Brown are joined by Nathan Vardi to discuss Nathan's book (For Blood and Money), the biotech landscape, hedge fund returns, the stock market GOAT, venture capital, why the market is rallying, and much more! To learn more about Future Proof, visit: https://futureproof.advisorcircle.com/ Check out the latest in financial blogger fashion at The Compound shop: https://www.idontshop.com Investing involves the risk of loss. This podcast is for informational purposes only and should not be or regarded as personalized investment advice or relied upon for investment decisions. Michael Batnick and Josh Brown are employees of Ritholtz Wealth Management and may maintain positions in the securities discussed in this video. All opinions expressed by them are solely their own opinion and do not reflect the opinion of Ritholtz Wealth Management. Wealthcast Media, an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. For additional advertisement disclaimers see here https://ritholtzwealth.com/advertising-disclaimers. Investments in securities involve the risk of loss. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. The information provided on this website (including any information that may be accessed through this website) is not directed at any investor or category of investors and is provided solely as general information. Obviously nothing on this channel should be considered as personalized financial advice or a solicitation to buy or sell any securities. See our disclosures here: https://ritholtzwealth.com/podcast-youtube-disclosures/ Learn more about your ad choices. Visit megaphone.fm/adchoices

I just plugged those plugs in randomly. Very confident in my assertion. So, I'm 76% done. I'm up to graduation day. That's a nice chapter. Do you remember that one? Yeah, of course. That's Raquel's, like, moment. Is it louder? I don't know.

Okay. Oh, this is when she comes back. So, when Howard Stern is interviewing a musician, he'll play a song, and I'll be like, do you remember this one? I once saw Harrison Ford at the New School. Remember, they used to have those inside the actor studios. And he couldn't remember a single scene

that he was in. And so the guy would say, hey... Was it James Lipton? Yeah, it was James Lipton. James Lipton would say something and Harrison Ford wouldn't know. Like, what do they call the dog? And no one would know. And the whole crowd would say, Indiana. Yeah, yeah. Right.

Wait, Harrison Ford has a TV show coming out. 1899? Oh, no, 1923. Oh, it's… No, no, no. There's another one. There's another one. You're right.

There was just a GQ article. He has something on Apple coming out on Apple TV. Look that up. Harrison. And he has another Indiana Jones, which nobody asked for. I'll watch it. It's called Shrinking. Of course I'm going to watch it.

Oh, it's with Jason Segel? Yeah. Oh, hell yeah. Why is it called Shrinking? I have some guesses. No, come on. He's aging. It's about mental health, I think, right?

Like a shrink. That makes a lot of sense. Oh, that'd be a good show for me. I ought to say, my mic feels super awkward. What do you guys think? It's like leaning. Which way? I am a Karen. I was getting cold.

Talk to the manager. I'm not a food snob, but... So speaking of commuting, they opened the Grand Central. Long Island Railroad into Grand Central opened this week. That's awesome. Yeah, but it seems like it's not a big time savings. How's that for here? So Chris just took it in from roughly near where I live.

He's like, this is amazing. I took the 838 train and it's 940 and I'm in New York. I'm like, wait, that doesn't, that doesn't sound great. So our commute is one hour door to door. One hour door to door. I looked at it today. I never seemed to look. Door to door.

Well, I'm sorry. Train to door. Everybody lies about that. Train to door. It's not the same thing. Yes, it is, dude. We live four minutes from the train station. Depending on where you park.

Red light. Everybody lies about traffic. No, okay. Train to office. Train to door was an hour. Josh and I live four to six minutes from the train station. So that doesn't count. Okay.

So you get on the train. So I make an 816. It's the shortest train. It's direct from my town to Penn. There's no stops. That's money. 40 minutes. That's 8.16. It's the shortest train. It's direct from my town to Penn. There's no stops. That's money. 40 minutes. That's money.

Okay. You just missed that because of daycare, right? Okay. So 8.16, I get to Penn at 9. It's 20 minutes to get from Penn here. So that's about an hour. But that's the best possible circumstance. You're in Bellatine by 25%.

It's 15 minutes. But fine. 15 minutes from Penn to here? Yeah, it's 15. It's not 20. Oh, I stopped to get food. Okay, okay, okay. But you know what? Your quality of life goes up when you go through Grand Central. Well, that's a fact. Exactly. The thing is you're four miles on the ground. So just to get out of it, the escalator is three miles long. No, it's 90 seconds. They said it's 90 seconds. Can I also say not just your quality of life, but specifically the quality of the people that you're rubbing is three miles long. No, it's 90 seconds. They said it's 90 seconds. Can I also say, not just your quality of life,

but specifically, the quality of the people that you're rubbing elbows with improves markedly. The few times that I've taken Metro North, like there are gentlemen in suits, like with newspapers. Long Island is animals.

It's like a zoo on wheels, this train. And when you get the pen, it's like arriving zoo on wheels, this train. And when you get to Penn, it's like arriving at the end of the world. Now they've renovated Penn, so it's not quite as much of a hellhole. Now it's a hellhole with high ceilings. Do they still have those bottlenecks

where you're like... Alright, so my favorite bottleneck at Penn Station is where New Jersey Transit comes down one hallway and Long Island Railroad comes down another hallway. And they meet in a place that I like to call the Springsteen-Joel Corridor. So it's Billy Joel fans colliding with Springsteen fans. Is it like Braveheart when the two armies are coming at each other? No, it's better to say it's like the Scottish

allied with the Irish in Braveheart. We're the same, but we hate each other. Right, so Long Island is East Jersey. Right? So that Springsteen Joel bottleneck is something else. Although not post-pandemic because nobody works anymore. Penn Station looks nice. It's when you get out of Penn Station.

That's where the zombies are. Penn Station was significantly worse pre the construction. Now there's no stores. Here's what I'm worried about. On the concourse, Long Island Railroad,

they used to have 20 stores lining it. And one was more disgusting than the next. There was Enrique Caruso Pizza. There was... There was a Tim Hortons there, wasn't there?

There was. They were about... Well, Rose's is coming about well Rose's is coming back Rose's is coming what was that we're gonna open it again what was the store they put in not the Dwayne Reed

but the there was a was it a Walmart it was Dwayne there's still a Dwayne Reed oh is it Kmart no

no way there was no Kmart yes there was no there wasn't Google this shit right now there's a Kmart in Penn Station there was not yeah maybe in 1997

it was in the basement of one Penn Plaza. It was right on the concourse. No, no, no, no, no. Three years ago. No. I'll bet you a million dollars. I'll bet you all of the Bitcoin you own right now. There was not.

There was not. Do you really want to do this? You want to do this with me? Kmart, Penn Station. Okay, you're right. Okay. But this was like in 1995 it opened. Girl.

It happened. This was three years ago like in 1995 it opened. Girl. It happened. This was three years ago. It says it opened in 1995. I don't care when it opened. I'm telling you when I had to look through it. This location. My friend, that Kmart had a basement. And you would have to walk past the Kmart.

And if it doesn't matter. Kmart to close Penn Station location February 2020 I'm looking at the photos above ground it should have been closed by a nuclear bomb so so

no literally it was there three years ago I'm not exaggerating I'm not making this up why am I talking about any of this alright how we doing fellas

so anyway we got Visa after the close who do we got after the close Nathan is never moving to Long Island after this discussion. Every time I go, I end up in traffic hell. Yeah, that's what we're known for.

That's our number two export after sesame bagels. We have the best traffic. Yes. But there's still a Ben's, right? Somewhere in Long Island. Oh, plenty of Ben's. I'm lagging. We had one in Westchester. It lasted about a year. Ben's is good. Ben's is great. I hate- no Ben's is not good

It's great. No, it's like hits the spot dude. No, no, no, no, no, I'm sorry. It's so lame. Wait, what do you get from Ben's? Oh, matzo ball soup. Okay, they have good matzo ball soup. Yeah. So what's your problem? So what's your problem? I don't know, their turkey's dry. It's just it's lame. It's not good. Ben's in Wheatley Plaza? No, not good. The worst. All right. All right. We're going to disagree. No, because my dad brings it over. It's just not good.

I grew up at that place. It's terrible. Horrible place. Well, it's all relative. Listen. I mean, it's not like... I'm a Ben's guy. Are you?

Yeah. I think it's great. You would go there? You think that's better than Lido? No. Okay. I just think it's great. You would go there? You think that's better than Alito? No. Okay. I just think it's good. So Chevron did a $75 billion,

authorized a $75 billion stock buyback. That's a lot of billions. Is that the biggest one ever? Probably not, but like authorization for an energy company. Maybe for oil, not for Apple, right? I will tell you what I think is significant about that. What was Chevron's market cap? Yeah.

When was it $75 billion? When was it? Like five years ago? Because they should have just LBO'd the whole thing, man. Yeah. They should have funding secured that bitch. Wait. I'll tell you exactly when.

All right. Chevron's market cap today is $350 billion. And... What was it at the bottom? It might be the biggest percentage, right, to market cap. Got it. Buyback. You know, Chevron got the the boot it's not in the down

anymore perfect timing right chevron got kicked out in november of 2020 chevron's market cap was 87 billion they just authorized excuse me it was 184 billion so this would have been like almost i'm not great at math this would have been more than a third of the whole market cap. That's crazy. By the way, I just checked myself because I didn't sound right. Chevron is still in. It's the only one. Exxon got the boot.

Exxon got it. Yeah. Is Traveler still in there? I think so. Yeah, yeah. That's the one that should go. Traveler? It's a really small company.

Wait, what do they need? They need to put Alphabet in, don't they? Yeah. No, wait. Didn't Traveler's did get removed? Hang on a really small company. Wait, what do they need? They need to put Alphabet in, don't they? Yeah. No, wait. Didn't Travelers get removed? Hang on. Let's see. And Alphabet did this one already.

Wait, I thought Travelers got replaced by Salesforce years ago. Hang on. Travelers. No? No, Intel got replaced by Salesforce. Travelers. It is. Don't you work for Dow Jones?

I do. But we don't own the index. That's right. Dow Jones? I do. But we don't own the index. That's right. Dow Jones components. Looking good. Coming in? Coming in. Three claps.

Oh, yeah. That second clap is the one, though. Travelers is still in. Nathan is correct. That is on the hot seat. What are we, 78? 78? 78?

Yeah. That is on the hot seat. What are we, 78? 78? Yeah. Welcome to The Compound and Friends. All opinions expressed by me, Michael Batnick, and our castmates are solely our own opinions and do not reflect the opinion of Ritholtz Wealth Management. This podcast is for informational purposes only and should not

be relied upon for any investment decisions. Clients of Ritholtz Wealth Management may maintain positions in the securities discussed in this podcast. Today's show, it's TCAF, the compound of friends. It's brought to you by Future Proof. Duncan, are you going to be there? I'm definitely being there. I'm sorry? You're definitely... Okay? I'm definitely being there. I'm sorry? You're definitely... Okay, Duncan is definitely being there. Me too.

It's September 10th through September 13th. It's in Huntington Beach, California. I can pretty much guarantee the weather will be good. I'll be there. Duncan will be there. Duncan is still laughing from that brain fart of his. The whole crew will be there. Everyone that you know will be there.

You should be there. If you want to purchase tickets, get an early start, you go to futureproof.advisorcircle.com. If you want to learn more about what we're going to be doing differently in 2023, join myself and Ben Carlson on a Twitter space with Matt Middleton and John Swolz from Advisor Circle, talking all about Future Proof. futureproof.advisorcircle.com.

We will see you there. Compounded friends, ladies and gentlemen, welcome to Oh, can I share this? Last week's episode was the number eight investing podcast episode of the week on Apple.

Who was our guest? Was it Kelly? No, we had Doug and Phil Huber. We're going to beat that. How could we not? Wait till you see what I titled this episode.

I don't even know. I'm going to say Jews control the media and we're going to be number five. Wait, hang on. Travelers, $45 billion. It's tiny.

Tiny, right? Get it out. It shouldn't be in the deck. So we were the number eight and then overall business podcast, which is a bigger category. What were we, Duncan? 20?

Yeah, we're off in the 20s. Who was in front of us on the investing channel? Do we know? Nothing. Nothing. We're going to be, I predicted long ago. Ramsey and Orman? We will be number one.

No, we won't. Doug Ramsey. After today, you're number one. What's his name? Doug? Doug. Dave. Dave Ramsey.

Dave Ramsey. We're coming for you, Dave. You're thinking of Doug Bonaparte. If you're listening to this, you've had a great run. Just kidding. A little bit. A little bit not kidding. All right.

So this is going to be a really exciting show because we're going to talk about something that we probably should talk about more. It's a huge part of the stock market and the economy. But Michael and I have a lot to learn. And this weekend, did you read the book this weekend too? I'm seven. I'm going to jump to chapter 19, 76% of the way done. Okay.

First book I've read in a while, by the way. You added my bear market. So thank you. Yeah. Michael stopped reading because- It's going to be a good year, right? Yeah, I think so. I hope so. This is what happens. One book a week. Isn't that what people are doing now? Yeah, right. You used to-

I was. You used to read five books a week. Yeah, I really was. What happens is you start having kids and it's unconscionable. And you start doing four podcasts a week. No, but if you, imagine having two kids.

Can you include the children's books in the count? No. For me, it's not about the kids. It's about the podcasts. So for me, it was when my kids started to become people and not babies,

it seemed unconscionable to me to lay on a couch and read a book while my kids are growing up next to me. So I just stopped. And I started reading like five books a year, down from maybe, I don't know, 20. And I can't get back into reading as much as I used to. But I read your book.

And that's why I'm so excited to talk about it. Anyway, we have a special guest today. His name is Nathan Vardy. Nathan, say hello to the folks. It's great to be on the podcast, guys. All right, great to have you. You are the managing editor for Enterprise at MarketWatch and the author of the book we're talking about,

which is called For Blood and Money. Prior to MarketWatch, you spent 22 years at, dude, really? Yeah. You spent 22 years at Forbes. Dude, really? Yeah. You could tell I didn't write this intro. I knew you were at Forbes for 22 years, a long time. There is an urban myth that I wrote more Forbes cover stories than anyone in history.

Did you overlap with Zweig before he moved to the journal? No. He left before I showed up. Okay. 22 years, a long time at any publication. I loved it. You must've. It was great. Okay. Uh, and you were covering hedge funds there for a long time. Okay. I was responsible for like big money investors. So like hedge funds, private equity, that sort of thing. And, uh, it was fun because every day was different. It's like,

you're an investor. So you're like covering every industry industry like one day you could do oil and one day you can be doing health care and and so like it wasn't boring okay so what made you want to write a book about drug discovery and so for blood and money just to give people a quick synopsis before we really get into it it's a biotech company and they happen upon a compound that's kind of orphaned and they make a run um for a leukemia drug. And we'll talk more about how that came about. But what made you say, because I know how much goes into writing a book, not to brag, author of several books. No, but I know what goes into it. What made you say, I'm going to give a year or two of my life to this project?

Three. Three years? It's a lot. Yeah. In the period between 2010 and 2020, when I was doing all this coverage of, you know, big investors, the sector that I found most interesting was biotechnology. I really kind of thought it was kind of epitomized the market. And it was just like the thing that seemed to be most meaningful to human beings, like I like Netflix and my streaming services that, you know, arose at that time.

It really I like sitting watching Netflix with my family. But this is an industry that can really change people's lives. And I really and the interplay between the money and the innovation I thought was really, really fascinating. And then I found this I stumbled upon this story. And like you need a good story like you know when I went to the publishing houses with this book

and I said I want to write this book they're like why are you writing about these leukemia like cancer drugs like why don't you write about Humira like

there are ads about Humira right there aren't oh why don't you write about a drug that people have heard of yeah but it's not about the drug it's about the characters

exactly like Duggan and Rothbam are interesting. You have great characters. And two of the biggest investment returns in the history of biotech and Wall Street generally are epitomized by these two drugs. So that's what really attracted

me to the kind of impact for people and patients and like the narrative of it. You talking to Showtime yet? When's the show coming out? It should be a good show. I think it could be a good streaming show. Absolutely absolutely nathan so can you like kind of sum up uh the story of of the book maybe don't like ruin you know the end or whatever but like just tell people why these characters were so attractive to you to write about and why this drug and um then we could talk you know more about biotechs generally. But what was it about this story that really turned you on?

So first of all, this is the story of two rival cancer drugs that have made a huge difference for patients. And so to me, that's really meaningful and worthy of looking into. And then the characters and the sums of money behind this story are extreme. They're not typical. Like one of the characters, you know, Bob Duggan. Not a scientist. Not a doctor. Not a college graduate.

Right. A 70-bagger. He's a Scientologist, not a scientist. Yeah. And, you know, he manages one of these drugs, the company that develops one of these drugs, and gets it to patients. He believed in it before, like nobody else had any interest in, in what he initially started to do. No one had any interest during the financial crisis.

The company Pharmacyclics traded for 57 cents. Yeah. Um, what was the ticker? PCYC. I remember that. Biotech people remember that one. Yeah. And, um, so he, you know, and when he takes it over, the company is like headed for bankruptcy.

So he actually tried to sell a piece of this Imbruvica, this really game-changing cancer drug, to see if someone could finance its development. Nobody – he talked to some pharma companies. Nobody was interested. So he ended up lending personally money. And that's how he takes control of the company. He had already taken control at that point. He had kicked out essentially the person who founded the company. Was that Richard?

Richard Miller. Did you speak to these people? I did. I did. I did. And, you know. A lot of sad stories in there. The people that were responsible for the founding and the innovation.

People like Duggan's son passed away, which is what ignited his passion to study this. But like Hamdi, for example, like a lot of these people got really got a raw deal. You know, I think I wanted to show the unvarnished story of how these drugs come to be.

And part of it is that it requires a lot of different people to do it. And there are winners and there are people who don't win. And that's just the reality. That was one of the biggest takeaways for me. Like this guy dug in. I mean, listen, he put $50 million on the line. Yeah. Right. So he turned it into three and a half. He should have been one of the winners. Yeah, absolutely. That's how our system works. Yeah, that's how it

works. No risk, no reward. But that was probably the most glaring. It's like, it's all about the financiers at the end of the day. Well, isn't like, not to get too wonky here, but like capital labor, who usually wins that? You know, usually capital. And in biotech, it seems even more extreme than like regular technology where I think there are more winners. Not that there weren't employee winners here, there were. You're not very judgmental in the book,

but like, is Duggan a good guy or a bad guy? What do you think? Well, I think if I'm the CEO who got fired when the stock was at $2. And lost all your vested options. And I was the only guy that would have run that piece of shit, frankly, which is what it was at the time. And then all of a sudden it's like, oh, wait, we're getting good results in some of these trials. Get him out of here. Like, so if I'm that guy, I think he's the devil.

I don't think he's a good guy. But if I'm a patient who's been cured or who's had the therapy and it's improved my quality of life, I think he's an angel. So that's what made the book so interesting to me. I agree. And you don't weigh in on like, all right, here's my villain. Here's my hero. You just tell the story and let the reader decide. And I was going back and forth as I read it.

I don't think you could read the book and come to the conclusion this guy is anything but a shark. But to Josh's point, like, okay, well that's true. He might have treated people poorly, like and he did some really nasty things to the people at the company. But at the end of the day, there was there was a lot of luck involved. Um, he, he swung for the fences and he, he hit it and he saved a lot of lives. And he didn't screw it up,

which is what happens with a lot of these drugs. You get one shot to go through all this, you know, clinical trials, you know, would you say there are people alive today who are alive because he didn't give up and he kept the money funding this stuff yes uh i think that again a lot of people contributed to the development of these two drugs and there are you know hundreds of thousands of people who take these drugs and to the families of those people yeah and to them dug in is literally a rock star like they want to have their picture taken with them they want to to touch them. Totally got it, of course. So it really depends on, you know, who you are in this. He's very eccentric too. Very.

And you have some great scenes of him interacting with scientists and they're like, what the fuck is this guy doing? I feel like that guy is like an NFL owner. That's like the type of personality that he's got. Yeah, I think that's fair. That's a good way to think about it. Yeah, yeah. But he's very passionate about it.

Like, you know, after he's still in this game, you know, he wants to prove that it wasn't luck. So he keeps trying. It was a lot of luck. Yeah, it was a lot of luck. Josh and I have been

talking about just these eccentric characters and how you just f***ing go for it like Kalanick and that whole crew. Richard Gonzalez, let me just,

I put this in the doc, let me just quote this. So Richard Gonzalez was who, he was the CEO of Is. Is of which company? AbbVie. AbbVie, okay. this in the doc. Let me just quote this. So Richard Gonzalez was who, he was the CEO of, of, is, is of, of which company? AbbVie. AbbVie. One of the biggest pharma companies. So that got spun out of Abbott Labs, just a gigantic company. Right. So this is how you introduced him. Richard Gonzalez had always been kind of a wild card in the pharmaceutical industry. For years, as he was climbing up the pharmaceutical industry ranks, he had falsely

claimed to have received a bachelor's degree in biochemistry from the University of Houston and a master's degree in biochemistry from the University of Houston and a master's degree in biochemistry from the University of Miami. In fact, he had dropped out of the University of Houston in the early 1970s, spent only four months at Miami. He never earned a degree of any kind. I mean, these are the characters that we're dealing with. Yeah, I mean, there are extreme characters in this story. And you didn't uncover that. No, no.

That's a well-known thing. characters in this story. And you didn't uncover that. No, no. That's like a well-known thing. Chicago's Crane's business broke that story, but he had been in the industry for years before that had happened. I feel like the biotech people were similar to the crypto people. Just the risk reward or the potential reward was so astronomical that it attracts these sort of people. Well, maybe like a long time ago. Now it's much more specialized. Yeah, I'm saying, yeah, that's what I meant. On the trading side, for sure. It's a very speculative market. There's a lot of speculative capital.

They're real products. Some of these work, right? How did the hedge fund guys in the book, Rothbaum, and who's the other one? The hedge fund people? Yeah. Wayne Rothbaum and Joe Edelman. Okay, so they're two different funds, but they're friends.

They're very close friends. They almost went into business together. Okay. Look, Joe— How do they like your treatment of their story? Because they're hedge fund guys. They don't want to be in books. I have to say that Wayne—it took me years to get Wayne Rothbaum to speak to me.

He's like a legend in biotech and biotech hedge fund investing. He never talks to the media. There's no photo of him on the internet. Very, very private. And it really took me a tremendous amount of time to get him to talk to me. He's very suspicious. He's very paranoid. You know, his company, Asserta, like he refused to have- You wrote about that, that he was right. Yeah, incredibly. Only the paranoid survive. That is his take. When you think about edges and trading, it makes sense. And, you know, he was very suspicious. But after I got him to talk and I started to have him cooperate with me, I have to say he's been like a real gentleman about it. So, like, you know, I don't think he loves everything in the book.

But, you know, I think he appreciates the amount of time I spent on it. But you wrote it like a journalist to Josh's point. It was very editorial. Someone even like – criticized might be too strong a word, but I kind of like deal with the Scientology stuff. Scientology plays a role in this story. But I'm not – first of all, I'm not writing a book about Scientology, but also I'm not like here to like litigate how bad, how good Scientology might be. Oh, those people come after you too. But you were – that wasn't about that.

You weren't like trashing or anything. No, but I was – exactly. But I did try to – but look, I'm reverse engineering how this story happened. Scientology played a role. I tried to show that. What was the role that Scientology played? The belief system of the guy or – Yeah. And the fact that he did, you know,

his, you know, he, the self-help elements of Scientology that he incorporates into his life, he brought into his business decisions and into the company itself, like literally. The corporate culture. The corporate culture. Right. And so it did play a role. And a lot of the employees, you know, weren't happy about it um if only because they had to spend time learning some of these ideas well no it's beyond that yeah think about the personality type and the belief system of somebody who goes to medical school does that person believe in aliens you know what i mean like that is it's it you probably could have you probably understated maybe the friction there didn't he have a medical degree or no? Duggan has no degree.

No degree. Oh, wow. But he did – he is steeped in the writings of L. Ron Hubbard and incorporates them into what he does. Another thing though – so I talked about like only the paranoid survive. I feel like with biotech specifically, a lot of it is based on the FDA and news. So a lot of it – I don't want to say there's more insider information than anything. I wouldn't know, but it just stands to reason that that's a thing. There was a lot of people that were followed in the book.

Not a lot, but there was an episode of somebody who thought he was being followed. Yeah, there's a lot of paranoia. Why? Well, information is important. There's also rivalries here and different companies developing different drugs, a lot of which may look like one another. And so, you know, knowing more about— Did you read the book about the gene editing rivalry? Yeah.

What was that called? It's one of the ones I read i read last summer that's good the walter walter isaacson book is it no no no uh they follow the three companies that they were all rival scientists at first they were teamed up and then was this the moderna one no it's like edit us and uh i don't know it doesn't. Anyway, it turns out that a lot of times when there's something happening with one company discovering stuff, all of a sudden there are rivals and everyone ends up working on the same thing at different companies. That happens all the time in biotech. And look at science. And so there's a public element to science.

Like, for example, when a company starts a clinical trial, they have to register that in the national database. Anyone could go look at that. And so there are ways to figure out what companies are doing. And people do that all the time to try to, you know, catch up, gain a competitive advantage. So there's a lot of that. There are some other interesting characters in the book and characters just like entities. The New England Journal of Medicine, for example, the FDA. Right. Like prominent, prominent roles in the development and approval of these drugs. Well, of course. I mean, first of all, you know, New England Journal of Medicine is like the most prestigious peer-reviewed journal for medical science.

And, you know, the FDA is responsible for approving new drugs in America. And so they play an enormous role. And the people, what is the FDA? I'm part of the Mitt Romney school that it's people, right? So they do have processes, but the people at the FDA have an enormous responsibility and it's really hard to get it right. There's a lot on the line. So you quoted somebody, I don't know who, who's Pazder? So yeah, Richard Pazder heads the office at the FDA that is responsible for determining which cancer drugs get approved or don't get approved. And he's gone through a very interesting arc in his life because he used to be known as Dr. No.

It was seen that he was really – it was really hard to get drugs approved by him and by his office for cancer. And then he kind of went through an evolution in a way. Part of it was personal because his wife had cancer, ended up dying from cancer. And I think that really impacted him. And, you know, he changed over the many years that he had that office and became much more open to finding ways to help industry get cancer drugs to patients for unmet medical needs. So here's a quote that I want you to riff on. He said, in the end, the FDA is in an impossible situation, and I have been in that impossible situation. You are either approving drugs too fast, you are approving drugs too slow. What we try to do is establish a balance of safety

and efficacy. That sounds awfully difficult. It is really hard. It's a really hard balance, and especially when you have desperate patients and desperate families. Well, efficacy is easy. The safety part is hard. Yeah, that's right. Getting that balance. And there's still a struggle about how to do that,

and there's always going to be a struggle. There are errors, though, where the person heading the FDA is easier and then errors where the person heading the FDA is harder. What would you say is the modern state of the FDA, like right now? I think that between 2010 and – Because with COVID, they were like, yeah, f*** it, do it. Right.

And they had to kind of. Yeah, and there was also a sense of urgency at the agency. I mean, and everyone was working 24-7. But I would say that 2010 to 2020 had a much more lax or accommodating FDA regime. And I think we're now moving partly because of political pressure into an era where it's going to be a little bit harder. Why? What political pressure is being asserted that they would want the FDA to be tougher? On efficacy – on safety, for example, and making sure that the drugs that are being approved are safe.

Is that a red-blue thing or not necessarily? I don't, that's a good question. It's not my sense that it's a red-blue thing. Actually, I think, you know, pharma in a way is one area that everyone kind of agrees to hate, you know, in an American political life. It's like safe to bash them. There was like a famous poll a few years ago that showed that pharma companies

had a lower approval rating in the Gallup opinion poll. Most of that is based on drug pricing though. Yeah, drug pricing. Not approvals. But this was like – anyways, the Gallup poll was that they had less trust in tobacco companies, which is really crazy when you think about it. But I think the pricing thing makes people lose faith in the goodwill of what these people are doing. And so to the pricing, is that why you need guys like Rothbaum and Duggan to finance these things?

Well, that's the way our system works. And the Economist wrote a really generous review of my book a couple weeks ago. And the reviewer asked a really good question at the end. The reviewer was like, I just read this book with all this testosterone and all this cash-soaked, you know, science going on and all these sharp elbows. And I'm like, is there not a better way to develop cancer drugs? Like there's got to be a better way. How does the rest of the world do it? Well, this is the only way that I'm aware of that works.

That doesn't mean that there aren't other ways. But this way, we know, produces outcomes. You have big drug companies in Japan and Switzerland. But they're all operating in the same – I was going to say, they're all maniacs also. They're all using the same risk-reward analysis to make decisions. But isn't AstraZeneca – and they did the same thing. They just – they send money risk-reward analysis to make decisions. But isn't AstraZeneca, and they did the same thing? They just, they send money to the United

States to finance these things? Yeah, well, I mean, these are global companies and a lot of what they do is premised on the U.S. market because we're the richest market, and so... We'll pay the top price for drugs. Our government doesn't negotiate drug prices like other governments. It's about to, but yes, that's right.

They say they're about to. So where are we today with these companies? Did AbbVie overpay? negotiate drug prices like other governments. It's about to, but yes, that's right. They say they're about to. Yeah, yeah. So where are we today with these companies? Like, did AbbVie overpay? From my seat, it looks that way. AbbVie paid. AbbVie bought. Pharmacyclics.

Pharmacyclics. And by the way, there's no spoilers, because you can just Google this. Well, I don't think there's any spoilers. But for this drug, they bought the whole company. Pharmacyclics owned 50% of this one drug. Yeah. And Johnson & Johnson owned the other 50%. Yeah, Johnson & Johnson owned the other 50%.

And Abby paid $21 billion for half of a drug. And this was a 50-cent stock, what, seven years before? Or 10 years before? Seven, eight years before. It was like less than a buck. And it went up to $260. So this is $260. This is one of the biggest Grand Slams

ever. In any industry. In any industry. It's really hard. The trade was huge. The Baker Brothers hedge fund, for example, was their big trade. Obviously, Duggan was a big winner. I've told this story before, but my mother got into Celgene.

Her brother was an accountant and was like a do-it-yourself investor and was on the message boards and followed. Who's the guy that was in your book? The message board guy. Oh, my God. I'm drawing a black. My uncle used to talk about this guy all the time. He was in your book. You mentioned him in your book.

It doesn't matter. It's just a dude that followed these stocks. And so she got into Celgene at like 50 cents split adjusted and Celgene had a great run and it got bought out and that's kind of by Bristol Mars

like 140 or whatever when you think of that 2010-2020 period we were very focused on fangs and tech for good reason but biotech Celgene

that stock did really really well and at Forbes we would every year like do top 5 stocks of the year. And every year was about the biotech stock. So that single stock changed my mother's life.

So Nathan, what 50-cent biotech stock should I buy today? I think the only thing I can help you – Do you have to buy the book? Is that the back of the book? Yeah. And I think the point is that there probably is another Pharmacyclics in the biotech wreckage today. You just want to look for the strangest situation? In a way.

What's the screen for that? Yeah. I don't know. I had a short seller message me the other day, and he said, you know, Pharmacyclics had every red flag you could possibly imagine. Yeah. I would have shorted that. Starting with the guy that controlled it. Yeah, exactly.

And there were a lot of short sellers actually. They had a guy who was a urologist as the CEO. Like everything looked wrong. Right, everything. And if you were to put these things in tweet form and done a thread as an activist short seller, you would have said this is a zero. And there were a lot of – there were short funds that were very short. I guess that's why they got to play the game. They got killed. short funds that were very short. I guess that's why, that's why they got to play the game. So some of your hedge fund characters in the book sold too early or should have had a lot more.

And I guess like that's from an investing standpoint, that's the part that most affected me like, Oh man, this guy was there. And then he started taking risk off and he knew it was the right, you know, stock to be be in but just didn't own enough um was that an interesting aspect of the story to you huge um so joe edelman yeah i don't know if you know this was the top performing hedge fund manager in the world between 1999 and 20 in 2020 that's that's crazy because nobody knows his name no one knows his name but he had a 29 annualized return and like you know tepper had some bad years there. Wait, for 20 years?

For 20 years. Holy shit. Yeah, I know. Because biotech was. You could only do that in biotech and getting them right. It seems that, yeah, that's right. I mean, or unless you were a quant, right? I'm not including Medallion or in that.

And so, and Joe calls his hedge fund firm Perceptive. And his view is that the psychology is more important, actually, than anything else. Or it's as important. So it's great to know the science and all that, but the psychology. Knowing when to hold them and when to fold them. Yeah. And that's why he called his hedge fund perceptive. And he told me that this is the hardest thing as an investor.

When you buy something early and then you sell it and then it keeps going up, going back and buying it again is so hard. And that's the problem that Wayne and he had in this story. Wayne just couldn't do it. Like in other words, the stock went from two to six and he started selling. And then the trial results started to surprise people. And I think you even say this. He's like, he knew he should have bought more, but didn't. He couldn't bring himself to go back into the stock.

And how much higher was it? It was like 10? 10 or 8. Oh my God. No, he just couldn't do it. It goes up to 260 in the end. Yeah, yeah, yeah. And he has to sit there watching his Bloomberg's machine,

watching that happen. And he was onto this thing before his Bloomberg's machine, you know, watching that happen. And he was on to this thing before anyone else. He understood the science before anyone else. And you know, it's not just the trials. Like, you would hear, like, rumors like from doctors and, you know, these things, the results are good. But he kept, like, poking holes in it. Like, oh, you know, it's early.

Because a lot of these go to zero. It's a binary thing, right? If you're a veteran in this game, you've had stocks go to zero. So, you know, it's early. Because a lot of these go to zero. It's a binary thing, right? If you're a veteran in this game, you've had stocks go to zero. So, of course, you sit there poking holes in it. Yeah, but Wayne's an interesting character because he really believes that he will bet everything on one stock. Like that's what he'll do. Like he just believes that's the only way, highly concentrated bets. His view is like if I'm going to spend all this time understanding the science, all this time

understanding the situation, like if I'm going to just make, it's like kind of like a Stan Druckenmiller way of looking. If I know I'm right, then why do I want to own 70 different stocks? Exactly. If I know I have the one. Yeah. But that's like a personality type. Yes. You don't end up being a biotech hedge fund manager because you're afraid of risk. No. Like it's a little bit self-selecting. It is. It is. But this is even off the charts, in my opinion, even.

But in this case, he just couldn't bring himself to go back in. And he ends up starting a whole other company and developing a whole other drug in a way to make up for this. That was easier than going back and buying the stock that he'd already sold. So you have like really learned a lot about the industry as a result of covering it as a journalist and then writing a book on it and talking to all these players that are involved. I know you probably have journalistic reasons why you can't own individual stocks. I do not own individual stocks. No, I understand.

Do you ever get tempted to be like, I feel like I could do this? I'm humbled watching it. Absolutely not. I don't have the stomach for it. Yeah, I feel like I could do this. I'm humbled watching it. Absolutely not. I don't have the stomach for it. I don't either. I could not do it. I'm an index person as a result. Let's talk biotechs now.

You've said that biotech has stealthily been a leading market indicator. Talk a little bit about what you mean by that. I don't know if you guys feel this way, but it had been so long since we had a bear market. I think everyone kind of forgot the rules in a way. And the biotech stock market started to fall apart in August of 2021, which was early. And I don't know, around September, October, I had a biotech investing source call me up and we were talking and this person said, you know, look out. You know, I said, what do you mean? He's like, biotech's always a leading indicator because it's the most speculative

part of the market, you know? So, so. Yeah, it's risk appetite writ large. And sure enough, you know, the NASDAQ three, four months later, that starts. And then three, four months later, the S&P starts. So I think that even if you're not engaged in the sector itself, it's good to look at. And then if you look at the last two years, sorry, and if you look at the previous period that we talked about, 2010 to 2020, biotech outperformed. And it was a great decade for stocks and even still biotech. We were talking about fangs all the time. This is you. IBB, which is, so the IBB is very heavily weighted toward the top 10 biotechs, but whatever, it's still the index. Returned 351% in the 10 years ending

December 31st, 2019. That compares to 343% for the NASDAQ and 257% return for the S&P. The top hedge fund manager of this period was Joe Edelman. It's not the Tiger Cubs. Not Cullen,

not Druck, not Tepper. Not Red Holtz. Biotech took the lead on innovation from Big Pharma. 400 drugs were approved in this period. And, you know, Pharmacyclics obviously being part of that story. So this was a legitimate biotech boom that took place in that 10-year span. Golden age. Golden age.

It was the golden age of biotech investing. Okay. For sure. It was the golden age of biotech investing. Okay. For sure. So where are we now? We have this chart, the second data point that you want to show. This is it right here. Right. So tell us what we're looking at.

So the first circle, that's when the biotech stock market starts to fall apart. Yeah, that's a good chart. And you see it takes a while more before the NASDAQ hits its peak. The purple is the IVB. So it was like a canary in the coal mine. Oh, totally. Hey, Nathan, do you look at XBI or IVB or both? I like IVB because I worry with that.

The other one is like a little more small, cappy. IVB are the giants. Yeah, yeah. So I think, and like at the end of the day, these aren't fangs, right? They're not that big. By the way, the chart looks pretty, the chart looks good.

I agree. The chart looks very good. Yeah. By the way, the chart looks pretty, the chart looks good. I agree. The chart looks very good. Yeah. By the way, the name I was looking for before was Feuerstein. Adam Feuerstein. Oh, Adam.

Okay, yeah. He is. He's at stat. Yeah, he's at stat. Yeah, Adam's a. He's not a chatroom guy. He's a fucking journalist. I was thinking of a chatroom.

I was thinking of a chatroom guy. That's my bad. Adam. Adam, we love you. I'm friendly with that guy. Yeah, yeah. All right. So today, there's some structural reasons why the golden age is over.

And there's a Fed angle to this. Wait, tell me why. Because I literally might buy IBB. Like, it looks good. I'm sure you could trade it for 10 points. I think Nathan's thinking a little bit bigger. No, I'm a long-term trader. When I look at it now, what it's telling me is that things are going to be harder this decade than they were last decade.

Okay. And if you look at the reasons why for biotech— Decade? What about tomorrow? You can see that in other industries as well. Again, leading indicator in my opinion. So the Fed, that's one big reason. Why? Because just less money available.

The free money era is over. Speculative capital being pulled out of the market. And, you know, that's what we saw here in that. So we know that. But there are also these structural- Wait, I'm sorry. Just dumb question on this. So obviously interest rates affect investor enthusiasm

and willingness to throw money around. But when you're funding biotechs where it's like a 70X or bust, does a 4% risk-free rate really matter? I think, I mean, it's also the tightening, right? So I don't just think it's- It affects exits. You have companies paying lower multiples,

just generally speaking, when they buy one of these things out. And most of these, if it's a good news, it ends with a buyout. That's right. Pharma comes in and buys it out. So then that will ripple outward from there or trickle down even at the startup level. Like what is the terminal value of this drug to an acquirer? It's going to be less.

Also, is Tiger Global going to make as many investments in the startups? It's just less money. Okay, that one's obvious. What else? Okay, so then there are other regulatory and political obstacles. So just to bore you for a second, accelerated approval, very important program to get drugs approved fast with a lot less rigor. The two drugs that I write about in this book were both approved through accelerated approval, very important program to get drugs approved fast with a lot less rigor. The two drugs that I write about in this book were both approved through accelerated approval.

Because there is no current solution on the market that they're trying to displace. It's truly desperate patients. You're meeting unmet medical needs with a little bit less data, but the data looks good. And then you promise the FDA, I'm going to go back and I'm going to do all the testing. Well, now the FDA is saying, well, you know. What's the track record on those accelerated approval drugs? Is it worse than for all drugs? No, no, it's good. It's good. I don't want to imply at all that if it's an accelerated approval, it's less than. But the FDA is now saying, wait a second, they seem to be saying we're less willing

to approve drugs through this program. Last year, we only had about 10 drugs approved through that program, which is not a lot. You have the Inflation Reduction Act. So now the government is going to be negotiating for the most expensive drugs that are covered by Medicare. So by definition, that's going to diminish the value of those drugs. It's also going to complicate the regulatory chess game that the companies play because the clock ticks once you get approved. So for example, in my book, the drugs are first approved in a pretty small indication.

The clock would technically start to tick then. So now those companies may not want to do that anymore. So it's going to change the way governments – companies approach. Can't that be reversed though? What do you mean? Like if DeSantis comes in in two years, can't he just be like, no, actually, we want the drug companies to make as much money as possible because it's America? It's a legislative thing, so, yeah.

Also, what if Nancy Pelosi decides to buy IBB? Yeah. There's another component to that. Just thinking out loud. Nothing's permanent, right? Actually, that's a good point, right? Like these things can change. You have other things like Project Optimist

that the FDA is doing where they're saying, well, the way you dose drugs in clinical trials, it's going to be a lot harder than it used to be. So these are like all sorts of regulatory and political things that, believe me, the pharma people are worried about. Then on a structural level, you've got inflation, so everything's more expensive. Your clinical people are worried about. Then on a structural level, you got inflation, so everything's more expensive. Clinical trials are more expensive. Just generally.

Every expense, right? The other thing is that the pharma companies have said, okay, we're tired of these biotech companies taking the lead of innovation. We're going to start funding our own pipelines. So those buyouts that you're talking about are also going to be harder to come by. Everyone in biotech now knows when they talk to a BD person in pharma that the first thing that BD person is going to say is, I got to check my internal pipeline before I talk to you about anything because we might be developing one of these for all I know. So you might say, well, what does that have to do with other industries? But I see that in other industries too. Like what was, let's look at this week. What was some of the news? just freeze too. Like what was, let's look at this week. What was some of the news? The DOJ sued Google for antitrust. Lena Kahn at the FTC is trying to block the Activision merger.

Non-competes, they want to get rid of them. I'm not talking about the merits of these things, including some of these regulatory things. Just the fact that they exist. Right. And so I think you have these headwinds that really weren't there as much between 2010 and 2020. To me, that makes it a hard—it doesn't mean good drugs don't get funded. It doesn't mean good tech doesn't get developed. It doesn't mean there isn't awesome science because there is. It just—it seems to me it's going to be a little hard. Quick tangent.

Hold on, hold on. I hear you on the headwinds, but the chart looks very good. Quick tangent. You know what? Forget everything I said. The lines between what is biotech and what is pharmaceutical have been blurred partially by acquisitions in this space. Broadly speaking, pharmaceuticals are chemistry-based and biotech is protein-based. Is that too simple?

Could you give us a better explanation? I did go to medical school briefly to pick somebody up for the airport. But can you kind of give us a better definition between those two things? My definition is that a biotech company is small, smaller. It can be developing as little. Is that still true?

Yeah. Amgen is pretty big. Amgen is a big biotech. Dow stock, Dow stock. Just generally, and there are tiny pharmaceuticals. Specialty pharma. Well, but they're not. I'm going to give you another chance. No, no. Do better this time.

No, that is what I'm telling you. To me, it's a difference between size and a diversity of products. You don't have biotech companies with a lot of legacy drugs, generic drugs. They don't do that. The idea with biotech from Genentech was the first biotech company out in California.

And the idea was like you could, instead of like when you bet on a pharmaceutical company, even if they get a new drug approved, it's not going to make that big a difference because this is such a huge, you know, portfolio. But with a company like Pharmacyclics, it can make it. So it changed the way these things could be financed. Okay. you know, portfolio, but with a company like Pharmacyclics, it can make it. It's swing for the fences.

So it changed the way these things could be financed. Okay. So I really look at it more as a financing thing. I called my book for blood and money. I think money plays an enormous role in all of this. And that's really the lens that I'm looking through this industry. So scientifically then, there's not a lot of space between whatever Bristol-Myers is doing versus, you know, a prominent biotech.

It's just a question of size and scale. Yeah, but also processes like, you know, traditionally pharmaceutical companies, like huge bureaucracies, doing anything was very difficult. They would do things like sequentially, you know, first we do this, then we do that. The biotech companies were much more nimble. They could do things in tandem. So that was a big difference. But look, Pfizer now, look, Pfizer's a great example. In 2010 to 2020, what was Pfizer doing? Big mergers, tax arbitrages. That's what buying companies after drugs were developed or at a very late stage, then de-risking the drug and then sicking your massive sales force on it. And now they've changed.

They want to be innovators, right? They divested their veterinary business. They divested their consumer products business. They divested their generics business. They're getting into crypto. They're getting into crypto, exactly. So the pharma companies want to do it their way. You have a great quote here, a couple, from Bob Duggan.

There is never a scarcity of money or ideas. There is only a scarcity of confidence in the ideas. The key to building confidence is to do whatever you say you are going to do and not promise to do what you can't accomplish. He's a confidence man. Pretty good. Right? Yeah, he's a confidence man. Pretty good. Right? Yeah, he's a confidence man.

He believes that confidence is like the root of... I feel like he's the type of guy that walks into a room and he's just dripping with charisma. It's funny. When I reported this book... That's a lot. All right. No?

When I reported this book, one of the things I found most interesting was the biotech people, when he first comes on the scene, are like, who is this guy? He doesn't know anything. He's not a scientist. Is he sort of the Trump of biotech? Sure. But the investing communities, particularly here in New York, they were like, this guy is a winner.

We're really interested in him. Because he had already made several fortunes. He was a track record in business, right? Right. Cookies, computer networking. He wasn't wearing a white lab coat, but he makes money. Right. And I think New York responds to that.

That's right. Yeah. That's right. For sure, right? We like Trump, right? A lot of counties here. Not Manhattan, but yeah, yeah. Let's talk a little bit more about hedge funds.

You spent a lot of time covering the largest asset management firms and hedge funds. Last year was not a great year for hedge funds, but it was a great year for certain hedge funds. But collectively, hedge funds generated $22.4 billion in profit after fees. No, no, no. You're getting it wrong. Oh, that's the top 20. So the giants, the citadels, the Bridgewaters and Renaissance of the world, the top 20 hedge funds after fees collected $22 billion. Outside of the giants, and this is from Bloomberg, outside of the giants, hedge funds overall lost $208 billion.

And on top was Citadel, which got the last laugh. And they cleaned up at 21 as well, and 20. So it's not like they were ever in trouble against the meme guys. So Nathan, what's going on? Well, Citadel is not really even a hedge fund anymore. No, no, no. Citadel is the house.

But this was the hedge fund. This was not the market-making operation. Understood. But if you own the market maker, it's really hard to lose. If you own the house, it doesn't matter if you set it up as a separate fund. What do you think is happening here?

I think that years has culminated to last year. We're now in the era of big institutionalized hedge funds. The day of two guys and a Bloomberg is over. It's really hard to start your own. I think Dan Loeb today would have a hard time starting his own hedge fund. He'd probably be sitting in a pod in Millennium or something because that's what the economics.

Working on his pitch book at night. Aren't there parallels between the hedge fund industry and the biotech industry? Like where it was in the 90s versus where it is today, much more institutionalized? I don't think so because the regulatory bar on biotech was always high. I think it was much easier to start a hedge fund in the 90s than it is to develop a drug for patients. Even like 2005, 2006, if you were friendly with the Clintons or married one of their kids,

you could just start like, oh, I'm starting a hedge fund and get cap intro and get walked through the room at Goldman Sachs. Well, Hillary's husband literally lost a ton of money now. Hillary's husband. I'm sorry, Chelsea's. I'm sorry, Chelsea's husband. Bill. No, it's just Chelsea's husband. It was like a putz that met her in college.

And then like a month later, Lloyd Blankfein is like white gloving him into a room. And, you know, it's like, oh, this is Bill Clinton's son-in-law. Line up here to give this guy a check to bet on Greek sovereign bonds. Like that was a thing. Hey, speaking of that. Can't do that now. Was there ever a scandal at the FDA where they were trying to like grease the politicians

or not, you know, the people that work for the FDA to get approval? Who, the hedge funds? You would think that. Yeah, that someone would have done that. Someone would have done that. Yeah. I don't know. So no one's gotten caught yet. Yeah, I don't know of one.

So no one's gotten caught yet? Not really. I don't know about that. That's the sequel. Look, I do think there are a lot of dedicated professionals at the FDA. I think that would be really hard to do, and they have institutional processes and so forth. I think insider trading, that's a one-off maybe,

but I think to actually corrupt the system would be a lot harder to do. The multi-manager funds, though, to me are the really big story because these are the giant funds and they have a lot of different groups within the fund doing all sorts of different things. That's what Citadel is. It's a big millennium. And it's working very well. It is working. All the talent's there.

And Bridgewater is not a multi-manager fund but huge huge firm um d shop you know same thing and like what's interesting about bridgewater and d shop we saw last year with bridgewater is you have you know this is these are institutionalized firms where they've you know i once talked to lee cooperman and he was like who is what's omega i'm omega there's nothing but those days are ending, right? Like we had the biggest. It's an arms race, but it's an arms race maybe for data, but really for talent. But how about this?

Of the top, say, 15 returners, none of them, all of them were incepted before basically 1990. I mean, with the exception of Viking. Yeah, well, because it takes years to get to that. You got to compound, right? It takes a long time. Some of the numbers in terms of like net gain, there's a column, net gain since launch are just astounding.

Citadel, $66 billion. Bridgewater, 58. The East Shaw, 52. These are net gains. Remember, that's from a big base, right? So that's not necessarily the returns. That's just like the amount of money that they've been in. If you started 30 and

you generate 66 it's impressive but it's still just a billion scale it is the scale's huge and you know what i was trying to say before is we have like a leadership transition at bridgewater like they've they've really changed you wrote about this last you you profiled bridgewater last year right yeah what are your big take uh greg jensen's the guy now he's the guy people are extremely impressed by him. I've seen him speak publicly, probably on YouTube or whatever. He was incredible on Oddbots or Masters of Business. I would give that guy money.

He called. Bridgewater, they really understood this inflation thing a lot. How long had he been there before getting the seat? His whole career. His whole career. And he was demoted. So he's a Dalio guy. Yeah. I actually heard Dalio's coming back. Did you hear that i'm just kidding where to riddle 12 dalio's come back to bridgewater one down here and i'm like teaser uh so so what's like what's

your big takeaway from bridgewater uh from from looking at the the firm that they've really transitioned away from ray and they're now going to be an institutional firm that's going to be here for a long long time okay And these things didn't happen before. It's so hard to do that. But now it's happening. What didn't happen before? These transitions never happened. You know, even—

Oh, because what you said about Cooperman, like he is Omega. Yeah. He never even thought about— Historically, the guy would either go family office— Or die. Or blow up spectacularly. That too, right. But those were your two options.

Yeah. Right. And, you know, even when I talked to Greg in October, he's like, look, Ray gave up the final vote. Like he had the final say on everything. Yeah. And now he doesn't. And he gave that up voluntarily. And that's a really hard thing to do.

But he did it. And, you know, I think you're going to continue. Same thing happened to D.E. Shaw. You know, David Shaw gave up. There's now like a committee that runs that firm. Yeah. You know, David Shaw gave up. There's now like a committee that runs that firm. And it's going to be very hard for the smaller hedge funds, in my opinion, to compete against these large firms, you know, on a regular basis. And the other thing I'll say about this list, which I think I shot you guys a note about this. When I look at this list, what really jumps out at me is Appaloosa.

Like, amid everything I just told you, here's Tapper yet again. Yeah. He's just two guys under's Tepper yet again. Yeah. He's just two guys under Bloomberg having a good year. Yeah. The guy's extraordinary. He's extraordinary. He's extraordinary. Is he the GOAT?

He is in my book. Yeah. For a lot of reasons. I like stuff how – what I like about David is how simple – like, you know, when he speaks and he analyzes things, I'm like, why? Why didn't I see it that way? Like, that's really such an easy way to look at it. He'll come on CNBC. They'll do this huge buildup, like the macro outlook from David Tepper.

And he'll be like, look, it is what it is. And everyone's like, yeah, it really is what it is. But he doesn't dress up his opinions in flowery length. I think the guy is extraordinary. I saw him speak at Salt maybe 2015. I was so blown away not just by what he said, which wasn't much, but the reaction to him in the room. And the whole room is filled with would-be Teppers. I did a blog post.

I called it the apotheosis of David Tepper. It was like right after he had truly kicked down the door and become the goat. And it was just amazing watching people genuflect and the reaction when he walked into like the bar, the room, whatever. So I think I kind of agree with you. Who else would be if not? Like who else? Simons. Well, yes.

The obvious choice would be Soros, Simons, Icon. Druck. Didn't Druck have zero down quarters in 22 years or something? I guess you're right. You're saying GOAT. You're saying ever, right? But even Tipper couldn't save the Panthers. That's true.

Not yet. I wouldn't bet against him doing it, though. I guess the argument would be that this got harder as the years went on. Of course. When it was not that many people doing it, maybe it was a little easier. Well, you know what else made it hard? When growth was the only thing working and undervalued stocks didn't work.

Right. So. The Tiger Cubs were in the FT this week and probably wish they weren't. They'll be fine. But it was 2022 was really bad for this type of fund where it's basically an all-in bet on growth

and then, hey, let's throw some venture capital into. So let me just read this. I want to hear your reaction to it. Chase Coleman has now dropped out of the list. This is like the top hedge funds after an $18 billion aggregate loss from its main hedge fund, its long only, and its crossover investment.

The crossover is where they also bought main investments in private companies. And then they just run through the list. Viking, what are some of the other ones? Light Street, KOTU, Maverick.

The poster child. He was also, they're also the pioneers. They were doing this. They were in, weren't they in Facebook? Like they were- Wait, let me get to the punchline. FT Alphaville's very rough back of the envelope calculation indicates that this means the famous Tiger Cubs

probably lost investors about $60 billion last year. This is all of them together. To put that in perspective, that means the Tiger Cubs accounted for over a quarter of our estimate for the global hedge fund industry's overall $208 billion loss in 2022. So that's like a lot of money to lose if you call yourself a hedge fund. Whoa, whoa, whoa, whoa, whoa, whoa, whoa. In the aggregate. Whoa, whoa, whoa. The run-up was spectacular. Agreed.

So even though the downfall was pretty disastrous in terms of the dollar amounts, like they had an incredible decade-long run. Yeah, I know. It's true. They built enormous businesses. The run was celebrated. There were articles that were the absolute converse of this. Look how much money these guys are doing.

Yeah, you got to call it out, right? For sure. I find it, like, Julian Robertson died last year too. And his legendary impact on this business is, it's impossible to encapsulate. But what I find interesting here is a lot of like they're going to be fine first of all every one of those dollars that they lost

was lost for an investor who can absolutely afford it that's the game the game they're playing is they're managing money for people where that kind of a loss it may not be acceptable and people might be upset about it but like all of those clients

knew what they were signing up for or should have known what they were signing up for. The Qatar Investment Fund will be alright. But they also it's like hey guy I'm not the 5% a year you know fund. I'm the fund that feast or famine hopefully most of the time feast. But

true. There's also a lot of pension funds in there I'm sure. Oh for sure. But true. Oh, there's also a lot of pension funds in there, I'm sure. Oh, for sure. But they're filling that slot for you, right? But they're filling that specific slot for the pension fund. The pension fund doesn't think that they're hedging. Well, the point is nobody – No, nobody.

It's not like people got ruined by investing in Tiger at the top, right? It's not like – Unless they invested in 2019 or something. And they went all in, which of course nobody did. Right, right. What I find interesting is, to me, the big lesson of all this is that you got to get permanent capital

if you're one of these guys. Oh, I agree. Yeah. And so you saw it with Ackman, which who I think wouldn't exist today if he didn't go out and raise permanent capital. And you see it here too. Like these guys like Tiger Global and KOTU, when they were hot,

raised so much permanent capital on the venture side that the hedge fund business is almost immaterial. It's not, but it's small in comparison to the venture side. So they've built these really terrific businesses and they're going to be okay. Well, what about Einhorn? Like he went from 14 down to a billion. He did not have permanent capital. No permanent capital.

It's his. It was his, probably, right? The permanent capital is his, probably. That's right. For the most part. Correct. That's right. What a great year he had.

Incredible. Incredible. Let's just run through some charts that I think are important. I feel bad for Einhorn. They're going to start cutting interest rates and his whole edge is going to go away again. You're going to have to hear about jelly donuts again?

Yeah. I didn't really say that. So in terms of the proliferation, I guess, or lack thereof, the dearth of capital that was sloshing around that's no longer. Look at this shit. So this is from Eric Newcomer. He's got a bunch of charts.

In what's clearly looking like peak insanity in retrospect, there were 149 funding rounds in which startups raised $100 million or more in the fourth quarter of 2021. That number fell to, I don't know, what does that look like? Just eyeballing it, 1920. I don't know why I said 1920. So yeah, the money is drawing up.

Next chart, please. We're looking at $100 million valuations. So for points in 2021, again, this is Eric Newcomer, the majority of venture deals funded a company with a pre-money valuation in the nine digits. That's a thing of the past with just 19% of raises meeting that same threshold today, down from a peak of 55% in September 2021. So yeah, the appetite for fast deals, for big deals, that's behind us, to say the least. I think it's going to be harder.

So this affects, obviously, but this affects- Was this a bigger bubble in 2000? What do you think? I think it's going to be harder. So this affects, obviously, Was this a bigger bubble in 2000? What do you think? I think, yeah. No f***ing way. There's more money. Hang on, hang on. I think it's nuanced. I wasn't trading.

No f***ing way. Hold on. It's nuanced. I'm backing up. I'm backing up. This is my co-host on the show. I'm backing up. All right, go ahead.

I think the nuance is that in 2000, truly, and I was 15, but truly, it was a national pastime. Not just for 12 months, like this recent one was. Not just 2021. Everybody was trading. Right? Fair.

Everybody was trading. And that's not what went on. Hold on. Stop. It was just based on complete fantasy. There was no business fundamentals. Nothing, nothing, nothing, nothing. I think maybe the dollar amount, the size of the bubble in terms of Zoom having $140

billion market cap, Peloton going to $40 billion, like the size of the dollar amounts was probably bigger today. But I think maybe the hysteria in 2000 was more of a fever pitch. I think there were more IPOs 2020, 2021 than there were in 99. In 99, like the IPOs and doubling on the same day, like that happened every single day.

Biotech stocks, IPOing and tripling. Like we didn't get that part of it. It's funny. For me, it's like about biases and like 2000

was the first time I'd ever experienced anything like that. Are you my age? How old are you? 48. Okay, I'm 45. So that was my formative experience

was the dot-com. And the financial crisis. I knew nothing at all because, I mean, I still don't know anything, but I really knew nothing. That's the first thing that I saw in this industry.

Like, 98, 99. And that also went on longer. Yeah. Like, this was gone before it started. I think that bubble started at the end of 96. 95. Yeah, maybe 95. With the Netscape IPO. I think that bubble started at the end of 96.

Yeah, maybe 95. With the Netscape IPO. Yeah, that's a good one. And that kicked off a five-year run. Yeah, the Netscape IPO was probably the starting gun. You're right about that. And what are the Nets? Like, do 50% a year for five years or something? Right.

So I thought it was crazier back then. And you're calling Druck a goat, right? Again, I didn't participate. No nuance, Michael. But the dollar amounts were bigger now. Yeah. My bias is that I'd never seen anything like that before. And this time I'm like, yeah, I've seen this before.

I know what it is. Well, can I add crypto to this though? Let's. So if I do, then this is definitely bigger. Well, you can say this bubble was stupider. Way stupider. The SPACs alone. Yeah, I agree.

The SPACs alone make this way dumber than taking a flyer on a dot-com IPO. It's funny though. Like part of this too is like proportional, right? So like if I look at crypto at its peak. Three trillion. If I add that to the stock bubble. That's Apple, right? That's one company. So like, I think because there's so much retail involvement, we really like, and you know, people feel like they're missing out. There's a huge emphasis on it. But at the end of the day, if you look macro, it's pretty small.

Wait, let me throw this at you. What if 1999 plus a pandemic? Like plus work from home. That would have been the shit. Plus free trading. That would have been- And Robin Hood. That would have been the greatest of all.

Like no sports on TV. Plus 1999. Can you imagine that Yahoo message board? No. So we're talking about investing, the future. I want to talk about this. I saw on the intranet. John, can we throw up this video?

Do we have this? So NVIDIA just released a new eye contact feature that uses AI to make you look into the camera. Did you guys see this? No. John, if you please. So on the left is what he's actually doing and on the right is what this technology does.

Do we have volume on this? So it's fake eyeballs? How sick is this? So wait a minute. So the left is what he's actually doing. The right, look. But is this in real time they're crafting this? Yes, yes, yes.

So you could be looking at your phone. That's fucked up. I should do that because I get yelled at. I get yelled at that I'm always looking down at my laptop from on TV. I'm not trying to be anti-AI second week in a row, but I see some eyeball jitter there going on. It looks cartoonish. The eyeballs on this big of a screen. Maybe not on a phone.

You would never notice. On a phone, I wouldn't notice. Look what he's doing right now. He's looking at his phone, and it looks like he's looking straight at the screen. That's pretty insane. Okay. Wow. So machine learning, AI, whatever the hell this is, could that play a role in biotech?

Like could that help discover chemical combinations quicker? Yeah, a lot of people are very excited about that. And I think that would be really amazing if that worked. And the thing that would be most exciting is right now most drugs that go into clinical trial fail, the vast majority of them. That's part of why the risk-reward here is so hard and why it makes it so expensive to develop drugs. So I think it would be great if we could, like, narrow that down and make it, like, I don't know, one in every five drugs or something like that. And if AI can help – AI approaches could help identify the right targets, then that could be really – yeah, there's a lot of people who are trying to do that. It's 4.08 and stocks just ripped into the close.

This market, I don't know what's happening, but stocks do not want to go down. Hey, I wanted to run this by you guys. This is in Barron's roundtable. Do you ever read like, ever read rival publicly, read Barron's at all? I'm part of Barron's. Oh, you are? Yeah. In what way? Well, market watching Barron's or all? I'm part of Barron's. Oh, you are? Yeah. In what way?

Well, Mark, you're watching Barron's or his sister companies. Okay. So I thought this was interesting. Abby Joseph Cohen had a take on active versus passive. That, to me, seemed a little bit disconnected from the reality. But I want to hear what you guys think. So she picks T. Rowe Price as one of her stocks. Like, it's the roundtable. So they're

saying what their favorite stocks are for the year. And this is what she said. We are entering a period when good active management of portfolios is going to make a difference after an extended time in which the market was momentum driven. Okay. People invested in market cap weighted index oriented strategies such as ETFs, which became self fulfilling prophecies until they didn't. This approach led to a high concentration in the indices of a small number of stocks, which grew overvalued. A handful of good active managers were left by the wayside.

Okay, nothing we haven't heard before. This is how she finishes that thought. Quote, last year, valuation nerds had their day, not just in fixed income, but also in equities. True. This trend isn't over because we haven't seen the full unwinding yet of investor interest in ETFs. End quote. Unwind? There will never be an unwind. Can you imagine the full unwind of ETFs?

The full unwind. What would that look like? $7 trillion out of an asset class? This is the analogy I used this week. ETFs are Netflix and mutual funds are Blockbuster. There will be no unwind. Well, that's my point. Has she seen the flows data?

It's one direction. Last year was a shitty year for stocks and bonds, and the money did not stop pouring into ETFs. So when is this full unwind that she describes? I also would like to know, okay, so is T-Row Price a good manager? How do you figure that out? Actually, yes. She had a stat

what percentage of their funds and maybe this was, they cherry-picked the shit out of this. The stock looks terrible. Is she recommending T-Row the stock? She's recommending T-Row Price. Listen, what would JC say about this? This isn't going up. Looks awful.

JC would say, I hope it goes to zero. Bro. All right. I thought that was interesting. But what I wanted to ask you is this is still the attitude of many people from traditional Wall Street where they think like ETFs and passive investing. It's like this fad or like this phase that's about to reverse. How much longer could you carry that belief before they have to carry you out of the room, I guess, is the question. A long time. To me, it's much more interesting to think about, OK, so we have all this passive money.

What's the impact of that on this market environment? And Michael Green, I think, does some really good work on that. Others do too. But to me, that is what people should be thinking about. It's hard for me to believe that people are going to start wanting to pay high fees again. I'm not totally dismissive of the fact that market cap is perhaps doing something to the market. But I think the stat that I keep coming back to is that active managers are responsible for 95% of the volume. Oh, this is why T. Rowe Prices.

They're setting prices. It's not the index. The notorious AJC said. But is there a point? Yeah, probably. But I think the point might be much higher than we think. The company's T. Rowe Prices mutual funds outperformed their benchmark 76% of the time in the past 10 years.

Amazing. Can that be true? It's past performance, right? Why is that stock at its 52-week low? Well, because people don't— Ooh, this looks terrible. Trading for 13 times earnings. Dividend yield 4.3%.

Yeah, I'd rather be a buy than sell. Maybe they should cut the dividend and start hiring some good stock pickers. No, it sounds like they have a great stock. By the way, all Intel does is miss earnings like every single time. Why are the analysts not catching down to this? It's down 6%. Wait, I'm not finished. I want to talk more about me.

I wrote a blog post this week. Chat GPT is everything you wanted Bitcoin to be. Did you read this yet or did you skip over it? I did not read it yet. All right, that's good. When did you write this? Yesterday. I'm glad I put it in the –

All right. My calendar was busy. All right. Let me just make my point that I wanted to make and then I want to hear what you guys think. Nobody yelled at me about this. And I'm not on Twitter. Maybe I didn't see it. I didn't get anything on LinkedIn or email.

Maybe nobody cares. No, a lot of people read it. Wait. Your post wasn't blowing up? No, nobody was mad at me. No, no, no. Nobody was mad at me. This is my point.

While Bitcoin relies on instant millionaire daydreams of traders or the belief of its Twitter-based cult, the actual function of AI chatbots will continue to proliferate without there being a need for endless conference panels and tweet thread defenses on social media. It just works. No theorizing, no pumping necessary. It's accessible in a way that Bitcoin as a payment system never was. Any child or technologically unsophisticated adult can make use of it on first contact. Not in Venezuela, not in the future, here and now.

I 97% agree with you. This is a great take. Hold on. Morgan H% agree with you. This is a great take. Hold on. Morgan Housel texted me. He's like, dude, these two realtors I know, they just had, all of their marketing materials and their entire website

was written by ChatGPT. He's like, this thing is two months old and there are realtors harnessing it. He's like, you're 100% right. The only thing I would quibble with is Bitcoin relies, yes, on a cult, but it's also relies more on the blockchain than the cult. No, how about it doesn't f***ing do anything after 15 years?

Yeah, there's less utility. Agreed. No, zero. Agreed. The chat GPT thing, it came out of nowhere. Microsoft invested in this company OpenAI in 2019. So it's two years, three years ago,

they gave them money. Now there's a product on the market that literally a six-year-old can use effectively. That's what they wanted Bitcoin to be. A company I spoke to yesterday, I didn't tell you about this yet, is using OpenAI to help our industry.

And it is pretty exciting. 100%. It's pretty sweet. So I guess the point is like, if you want to talk about revolutionary technology, for me, this is what it looks like. Like my kids coming home and using ChatGPT because somebody in school told them about it that day.

Not to cheat, but to just like better organize what they're trying to learn. That's pretty cool. And they're not doing it because they're trying to, they're trying to make a That's pretty cool. And they're not doing it because they're trying to, they're trying to make a quick buck. You know, they're literally using it. It's not speculation.

They're actually using it to improve their, people are using it. There was a professor. It's like HGH, but it doesn't make your head 10 sizes too big. This is the wall street journal. They have a professor who's using it to teach his students. Yeah.

Not to learn how to cheat. To help them. Last month, a professor at Weber State University in Utah asked the new artificial intelligence chatbot to write a tweet in his voice. Perfectly captured his tone. Holy cow, he said. And now there's a debate.

Should educators be banning chat GPT or building on it? And obviously this professor, the story is that he wants his students to learn how to use it because this is where the world is going. Because you can't fight it. It's like finger in the dike, right? Right. Yeah, you can't fight it. Okay.

Is there a – And also, it's only going to get better. Right. Like – Right. If this is the version that's been released after two months – Think about what V2 looks like. It's like unfathomable.

Is there as much concern amongst writers and journalists, do you think, as I think there is about just AI-driven content in general or not really? I don't think there – I haven't felt it, but there probably should be. And I think it's going to be ubiquitous throughout industries as they get reshaped. You ever click on an article on Yahoo Finance and realize like two paragraphs in,

that it was written by a computer? This is a computerized article. Yeah. That's pre-chat GPT. Right. Those articles are going to get better, I think. I feel like you're saying chat GPT.

I can't say it. If you were an editor and you had a news organization that most of their traffic was coming from tickers on Yahoo Finance and there are a lot of them out there, let's say Seeking Out, no disrespect,

if you were the editor, wouldn't you say like write me an article in the style of adam feuerstein about this phase three trial that was just announced from pfizer or whatever and like you could probably get a decently written article i'm gonna defend adam here i don't think he could he doesn't need to be defended. Adam's the man. I'm just saying, like if you were an editor trying to bring in a lot of content at a low cost,

you would be doing that already. I think if you're running a content farm, like for sure, right? That seems like a much smarter way to go. Simply Wall Street,

they're, like every ticker you search on Yahoo, there'll be a Simply Wall Street article. It's 100% a computer, right? I don't even – it might be a computer editing the computer right now. There's nothing there.

It's just stats put into paragraph form. There's going to be more of that and it's going to be better. Yeah, totally agree. That's what I'm trying to say. Before – I totally agree. Before we get to our favorites and wrap it up, I just want to say one thing. Oh, wait. Nicole.

Slap Nicole. What? I have a tweet. All right. I'll actually – no, I want to say one thing. Oh, wait. Nicole. Slap Nicole. What? I have a tweet. All right. Oh, actually, no, I want to say two things. I'm doing a Twitter Spaces with Ben Carlson and some of the guys from Advisor Circle on Wednesday at 3 o'clock to talk about Future Proof. Okay. But what I really

want to say is last week, when the market was down, because bad news is bad news, I mentioned something that Chris Sidial did about market structure, and you sort of like poo-pooed it. I did? Yeah, you did. You can run it back.

You totally did. I'm like that. And so the market is up a lot since then. What do you have for Nicole? Putting that over here. Keep talking. Dude, JC texted me about this. Yeah, that's what we're doing.

So JC just texted me. Yo, let me know if you like those tequila seltzers, blah, blah, blah, blah, blah. Wait, what was your point about Chris Sidial? Is he mad at me? No, no, no, no, blah, blah, blah. Wait, what was your point about Chris Adel? Is he a man of it? No, no, no, no, no, no, no. Not at all. Not at all.

But my point is the market is so strong. I'm not sure why. Eric Jackson just tweeted, Microsoft, which tanked the market yesterday morning, especially tech stocks because of their cautious cloud guidance, was up 3% today and is upset more than 7% since 9.48 a.m. yesterday. Why is the stock market so strong right now? The S&P was up 1.1% today. It's January.

Oh, okay. All right. Let's have some tequila. We can all go home. Let's have some tequila. Is there not seasonal strength for stocks in a typical year? Last year being an obvious exception. Oh, okay.

All right. So that's it. It's January. You heard it here first. It's January. Don't people put money to work in January? Am I making that up? Okay. All right. I didn't know that was- All right, so wait. I that's it. It's January. You heard it here first. It's January. Don't people put money to work in January? Am I making that up? Okay.

All right. I didn't know that was- All right, so wait. I don't know. I'm asking. You tell me it's January. You know. Is this a bear market rally?

Yeah. Yeah. Yeah. Completely. You know why? I don't- Because the earnings are okay. They're not that bad.

They're not that bad. Microsoft's earnings were not bad. Guidance wasn't great. Guidance was cautious. How about this? The market does not believe corporations' guidance. The market is saying,

I call bullshit. You can say what you want. I don't believe you. I'll take that. I'll take that. The market is looking past whatever self-guidance. I don't know how to explain this.

Is this just... Listen, in 30 days from now, if we're down 10%, was it all just a dream? Maybe. I don't know. I'm just asking. I don't know why the market's

so strong right now. Did you have fun on the show today? I cannot wait to come back. But I want my book on that shelf back there. 100%. 100%. Nathan Vardy, ladies and gentlemen. Nathan, that was great. What are we drinking? We're going to do favorites.

And while we do favorites, so JC invested in this thing called Casaterra. Actually, he said let me know if I should invest. Tequila with natural flavors and sparkling water. It's 7% alcohol by volume. It's pretty strong. We've got three flavors. I like the box.

Oh, wait. What flavor did I pick? Strawberry? I don't know if you want. It's grapefruit. Oh, I like grapefruit. What is this? What else you got?

Lime? I'll take the strawberry. Strawberry and lime. Lime is probably going to be the best. Are you guys going to shotgun these? Give me a key. Which one are you doing? There's the lime.

So these are ice cold. We had them in the fridge. It's good for the beach. Yeah, it's good. It's good. It's good? It definitely plays. All right, I want to invest.

You want in? Valuation is $75. I just texted JC. It tastes good. I wanted. All I just texted JC, it tastes good. I wanted. All right. All right, I'll start. So last week, I went to a comedy show and I saw Shane Gillis.

How is it? Lime is not for me. Okay. Shane Gillis was hilarious. Do you like a stand-up guy? Stand-up comics? You know this guy, Shane Gillis? No, I don't. Okay. He was. I don't know who it was hilarious. Do you like a stand-up guy? Stand-up comics? You know this guy, Shane Gillis? No, I don't.

I don't know who it was either. I was crying, like absolutely howling. And he's just, so whatever. If you want to check him out on YouTube, he was incredibly funny. The other thing, Stephen A., who has been my guy forever. I liked Stephen A. before.

It was cool to like Stephen A. At least 20 years ago. I liked Stephen A. before. It was cool to like Stephen A. Like, at least 20 years ago. I was on Howard this week. He's promoting a book, too, right? Yeah, he wrote a book called Straight Shooter. I had to compete against him and Prince Harry, whose book came out the same day as mine. Can I tell you something?

I don't think your reader is also reading Prince Harry. I know someone's buying the Prince Harry. Everyone seems to, like, mathematically, the whole nation's buying him. Can I tell you, I think the f***ing Illuminati are buying this book to make it seem like people care about the royals. I think there's a conspiracy. No, it's the skulls. By the way, and also Nobody's buying this book. It's sold like a million copies.

For blood and money. I don't know. Where are these copies? These copies are underneath the palace. And my third favorite is for blood and money. Thank you for putting a bottom in my bear market reading. The low is in. Thank you. Great book.

Well done. Really, truly a great book. Fun read. Learned a lot. Cheers. Thanks. Strawberry is better than lime for the record. Yeah, strawberry is good.

Better than lime. I think it needed a little bit of sweetness and you don't get that from lime. Actually, I'm opening grapefruit just so I can confirm. Okay. You guys want to – How old are you? I'm three. All right.

All right, Nathan, you got a favorite for us? What do you got? This is a little New Yorkery, but there was an article this week about What's the Matter with Men? That was the take on a book. Anyways, I thought it was really good. Well done. What's the TLDR?

Well, to me, it's like there's this issue with the participation rate where there are fewer men in the workforce every year. And I don't know. Like it's really – no one knows why. Opioids, video games. We kind of know why. We kind of know why. But it's uncomfortable, right? It's sad.

Yeah. It's not – there's no – and there's nothing like saying like this is about to turn itself around. No, it gets worse every year. You know more women than men graduate college now? Oh, yeah. And there are some aspects of the collegiate experience that are not suited to like men naturally. Am I saying – like how canceled am I going to get? Maybe I shouldn't go any deeper on this.

Thank you for listening. No, but a lot of the jobs, the high paying jobs have gone to people with college degrees and many, many men are not going to college. Like these are the facts. And I think that plays a big role in it. And many are not working.

Well, when you turn 27 and you can't afford to live and you can't afford to start a family, what do you f***ing do with yourself? Anecdotally. Yeah. You live in Long Island, right? I do. How many men in their 50s, anecdotally, do you know, that aren't working? Not a lot.

Not a lot? No. In their 50s? Yeah. No, most men I'd—I might—I don't know. It might be where on Long Island I live. Right. Because if you go out east, like I'm in Nassau County.

Right. It's one of the most expensive places on earth to live. So you can't live there if you're not working basically. It would be very hard. There's no real support network in a suburban setting like that. Right. But I think if I went further out east, there's meth. Like it's different for sure.

And then you get to the Hamptons and then it reverses. But why? What's your point about that? It doesn't have to's meth. It's different, for sure. And then you get to the Hamptons and then it reverses. But why? What's your point about that? But it doesn't have to be meth. It could just be people dropping out for various reasons from the workforce. And anecdotally, I see it. Not a lot, but I see it. Sadly, I think the decline of the unions

has played a really big role from what I've read. I know nothing about that world because I'm only 45, and, you know, that's like the 60s, 70s. But that really is the time that people said, like, that's when America was America because there was no question that you would be able to have a family and live. And provide.

And that is now a question for a lot of people. And do they have any potential solutions for this? I think we're like at the, how do we diagnose the problem? Okay. Figure out what it is. Who wrote this piece? I don't know. I'd never heard of him before. Was it, was it chat GPT? Anyways, I read it. It was, it was, it was based on a book that's come out on this issue. And I'm kind of, you know, talks about this all the time. Galloway. This is one of his big Scott Galloway he's a smart guy one of his big topics

what does he think about John and Tuck not a huge fan my favorite is Aubrey Plaza she in what she was great right

I mean what she did in White Lotus was she anchored the show she was maybe the most relatable character but then she also still has an edge to her. But you know what else?

It didn't start that way. She ramped. Yes, 100%. Anyway, she hosted Saturday Night Live this weekend. And in this day and age, you don't have to watch the show. Every segment is on YouTube. Just go look up Aubrey Plaza Saturday Night Live.

She's amazing. She crushed every assignment on this show, starting with they did The Black Lotus, and she was hilarious. She was great in every aspect of hosting the show, but what I really loved about it was she was a page. The monologue was awesome. The monologue was ridiculous.

In 2004, she must have been 20 years old, she was a page at NBC for Saturday Night Live. What do you mean a page? What is that? The page program is like you wear the blazer with the peacock and you just run around and do errands for people that are on the shows. I think you guide the tourists too when they come in. She was like, go fetch me a glass of water.

And she said, one day I'm going to host Saturday Night Live or be on Saturday Night Live. And it's 19 years later and she's the host. I feel like if I had to buy stock in one young actor, not that she's that young. Is she 40? Yeah, I think close to 40. Yeah, it'd be her.

She's great. I just looked at her performance hosting the show. I'm like, yeah, of course she's great. I just looked at her performance hosting the show. I'm like, yeah, of course she's genius. She did SNL. She did Weekend Update with, what's her name, Amy Poehler. And they were in character from Parks and Rec, which was, I think, underappreciated. Underappreciated show. Way, way underappreciated show.

Have you seen Ingrid Goes West? Maybe. It was one of her first big movies in 2017. She plays a stalker and she, like a creepy stalker

who doesn't know she's a stalker and she was incredible. What's the movie, the Netflix movie where she's a criminal? Emily the Criminal. Emily the Criminal.

That was great. That was a lot of fun. Have you seen Black Bear? No, I was going to watch Tee It Up the other night but I didn't get to it. It was good? It's worth watching. Is it a film? Yeah, it's a film. Okay, I'm out. Have you seen Black Bear? No, I was going to watch Tee It Up the other night. I didn't get to it. Is it good? It's worth watching.

Is it a film? Yeah, it's a film. Okay, I'm out. What is Black Bear about? I thought it might be. I read the review. Is she the main character? It's about a film.

A screenwriter. I don't watch films, only movies. It's worth a watch. I think you might like it, Josh. Michael, definitely not. Thank you, Duncan. All right. Hey, great job this week, guys.

Here it is. Sorry, just put a bow. A filmmaker suffering. So that's why I thought it's a film. A filmmaker suffering from a lack of inspiration retreats to an isolated lake house, which it manipulates and controls her host in an attempt to create a work – oh, controls her host. I do like that.

Anyway, that's Black Bear. Great job this week, Duncan. Great job, John. Nicole, Sean, happy one-year anniversary working with us. To the listeners, thank you guys so much for coming out. Make sure you check out Nathan's book. What is the name of the book? Tell everybody.

For Blood and Money. All right. Where could they buy that? Any local bookstore, Amazon, Barnes & Noble. And where can we read more of your – So I noticed – I was looking up your byline. Your writing kind of has dropped off as you're promoting the book. I get it.

Writing and promoting the book and having a job. The piece of your articles. I'm supposed to be at work right now, right? Yeah, I know. So where can people find your stuff? Your market watch? Are you columnist, reporter, both? I'm kind of managing more now, but I'm still trying to write as well.

And you can check out my work there. You're going to stay on the pharmaceutical biotech beat? Yeah, I'm working on a story right now that I'm pretty excited about. Awesome. All right. So, and you're on Twitter mostly? Like social media? Yeah, Twitter, LinkedIn. What's your Twitter handle?

Nathan Barty. Okay. At Nathan Barty on Twitter. Why are you waving? You got something for us? I have a review to read when you're done. Good. I'm done. Go. Okay. So this week we have, first of all, we have 1,400 reviews on Apple Podcasts, which is

pretty good. It's a high bar. Yeah. Guys, keep those reviews coming. We read them all. We love them. Thank you so much. Yeah.

So 87 Illini guy says, who has more fun? It's a treat to listen to people who have so much info to share while laughing and enjoying themselves and their audience. I look forward to every episode. Pro tip, listen to the pod and then watch it on YouTube. Oh, man. That's a hardcore listener. Thank you, Illini. Very cool.

Any others? No? My mom didn't write that? I don't think so. All right. All right. Thanks to Duncan. Hey, guys, thanks so much All right. Thanks to Duncan. Hey, guys.

Thanks so much for listening. We appreciate it. Make sure you buy Nathan Vardy's book. Buy multiple copies. It also makes a great stocking stuffer this time of year. Thanks again. We will see you next week. All right.

So that's the warm-up. I just wanted to get some of the kinks out. And now we're going to get started. Now we're going to start. Yeah. You okay with that? That was a lot of fun, man. That was awesome.

Really great.