Oaktree Howard Marks: Masters in Business (Audio)

He's been running the firm for twenty two years. They've put up phenomenal numbers. Nobody is really even close to them. Uh. And and when you consider that it's in debt and not equity, the numbers are even more astonishing. I I found Howard to be extremely thoughtful, intelligent, forthcoming individual. Not a lot of people who are in his circumstances UH tend to be as just transparent and open. And you know,

he just lays his cards down on the table. Uh. I think you'll find his discussion on second level thinking to be very worthwhile, as well as his explanation for how and why investors become successful. You know, there are a lot of people who are smart guys, who are hard working, who who apply their their field in the um industry of of investing in finance, and they end up putting out numbers that are you know, fair at best. And Howard explains what you need to do if you

want to outperform. I especially am fond of his discussion on predictions and the folly of forecasts let's a little bit of confirmation bias on my time, my my part, as well as his discussion on on risk and risk management. I found that absolutely fascinating and I think you will as well. So, without any further ado, here is my conversation with Howard Marks of oak Tree Capital. This is Masters in Business with Barry Ridholts on Bloomberg Radio. My

special guest today is truly a special guest. His name is Howard Marks and he runs oak Tree Capital. Let me give a short version of Howard's curriculum vita, which is quite lengthy. Um graduated from Wharton at the University of Pennsylvania cum laude in nine seven, a major in finance and a minor in Japanese studies. Got his MBA from the University of Chicago Booth School of Business, worked as an equity research analyst at City Corps for the

next decade before he became director of research. Ultimately became vice president and senior portfolio manager for convertible and high yield securities. Left to lead the distressed asset group at Trust Company of the West. Did you lead that group or set it up? We'll we'll get into that. We'll

get into a little more details about that. And then he left Trust Company of the West to set up oak Tree Capital, which runs a high yeld bond fund, distressed debt, private equity, and other strategies, and has put up some astonishing performance numbers. The seventeen distressed debt funds that oak Tree has ranked up annual gains of after fees for the past twenty two years, far outpacing its peers. Howard Marks, Welcome to Bloomberg. Thank you, Barry. So let's

get into a little bit about your background. Obviously Wharton and then a MBA suggests you had been thinking about finance. Were there ever any plans to do anything besides uh, go into asset management. Well, I wasn't one of these kids who was reading prospectuses at nine you know. Uh, first I wanted to be a high school history professor, that I wanted to be an architect. I had lots of interest. And then then when I got serious, I thought I'd be an accountant because that's what my dad was,

and I I really enjoyed accounting. But when when I got to Warden, I switched from accounting to finance in terms of my interest. When I got out of Chicago, I still didn't know what I wanted to do. I knew it would be in finance, but I applied for six different jobs in six different fields of finance. Oh that's quite interesting. What other fields were you looking at? Accounting, corporate finance, investment, banking, consulting, um, great variety. Well, well,

you seem to have found your call. And I got lucky to say, And by the way, that's something that just about every guest I've had has said, never hurts to get lucky, and U being smart doesn't hurt either. A good combination between the two of them. So you began your career. I found this fascinating. You began your career as an equity analyst, and yet when you moved to the Trust Company of the West, you started covering

fixed income. How did that transition take place? Well, it's not that interesting a story, but but but you know at a bank, you progress, uh hierarchically. So I moved from being a junior anals so senior analyst, to a unit head to director of research. As you described. The bank didn't do well in that period because we were nifty fifty investors, the fifty biggest, fastest growing, best companies in America. UM. And if you bought them in sixty eight and you sold him in seventy three, uh, in

the best companies in America lost any money. Uh. And so that that didn't work out well. I was part of that UM regime and a new guy came in to be chief investment officer and and he wanted his own director of research. And he said, I'd like you to start a convertible body fund just like just like that, And so I did. It was August the first seventy eight.

And then I got a call later that month from from my boss and he said, you know, the there's some guy in California named Milken or something, and he deals in high yield bonds. Can you figure out what that means? Because a client has just asked for a hiel bond portfolio. You know, that was part of my luck. That was the beginning of the hyl bond industry. I

was thirty seven years ago. And uh, you know, almost everything that's been interesting in finance in the last thirty seven years has gone through, uh, the hyal bond market. So it's front row seat on history. And you know, part of the luck is to get there early, and

I did. And I also get the sense that you very much enjoy having that front seat on history, in history and being able to to be more than a spectator, but an active partisan, right, an active participant, and and and somebody who tries to figure out what's going on, not just cope with what's going on, but actually understand and fundamentally and and as you know, communicate about it. I believe you have described that as second degree thinking,

second level, second level, second level thinking. Yes, that's right. Uh. You know, the real success in investing goes to people who who achieve a superior understanding of the things that are going on, why they're going on, and what they mean. In other words, not just understand what the crowd knows, but a whole level beyond that. Well, if you if you think the same as everybody else, you'll behave the same And if you behave the same as everybody else,

you can't expect to outperform. You'll get you'll get average results. But in investing um success consists of having above average results. So you have to get away from the crowd and you have to achieve a higher level of thinking. You know, for example, very simple uh people say it's a great company, you should buy the stock. Second level thinker says, it's a great company, but it's not as great as everybody thinks, you should sell the stock. So it's kind of uh,

it's kind of reflexive or counterintuitive. Doug Doug cast We were discussing a mutual friend calls that variant perception, looking at things a little differently than everybody else does to find the opportunity. That's right. So, so speaking of opportunity, you end up at Trust Company of the West and you created the high EELD bond fund. There a convertible securities funds and is this was this the world's first

distress bond fund. I think it was the first distressed debt fund from a mainstream financial institution prior to that at just as our high yeld bond fund that city and seventy eight was the first one from a financial institution. No bank had ever done it before, or trust company and UH and the same was true in the distress

dead field. You know, you had your your, your couple of guys at a desk in Grantwitch or on place trading for their own accounts, or a few for a few, you know, for a small high net worth hedge funds, but UH, nobody had ever done it on the institutional scale. You're listening to Masters in Business on Bloomberg Radio. My special guest today is Howard Marks. He is the founder and chairman of oak Tree Capital. And we were discussing previously.

You had set up what turned out to be the largest distressed debt funds right in the midst of the financial collapse in oh seven o eight. What was that like? What sort of pushback did you get from investors? Well, we started to raise UH capital on the first day of oh seven and things have been going very well in the world. UM. And what happens, of course, is

that when things go well, UH standards decline. People require less credit worthiness, they do riskier deals, they take more risk, because what the hell they figure, the more risk you take, the more money you make. Uh. We were alarmed at that friend, and so we went out to raise a fund. On the first day of O seven, we said we'd like to raise three billion. Now we had started off eight UM with a ninety six million dollar fund. We had grown past a billion dollar mark around and here

we are in O seven. We said we liked that three billion UM and uh. Within a month people had offered us eight and we said, we can't take eight. There's nothing to do with eight. But we'll take three and a half and we'll close that fund and we'll start investing the three and a half billion. And uh.

But we asked people to give us the remainder of their commitments for a standby fund, that the money that we could have in reserve, because we thought there was an opportunity coming and if it came, we'd like that more money. I think I think that was a little bit of an understatement that opportunity came along. It certainly

did later on it did. So anyway, we had the first closing in March of O seven and the last closing in March of OH eight, and by the time we finished raising money was ten point nine billion, as you know, and now is our fund seven B we called it, and we we told people that we wouldn't raise them invest the money until there was something good to do with it, and we wouldn't charge any fees

until we invested the money. Um So we waited from the March oh seven until June of eight to start investing, and in June of eight we started to invest gradually and the fund was called the Dailyman went under September fifteen of eight, and then we really got busy and it was se called on December. How long did it take to get fully invested at that point, well, the last we never invested the last money. It's an interesting story, yes, because well we thought that in a real meltdown that

cash would be king. We would be involved in bankruptcy restructurings, and in order to really capitalize on them. You know, in a world where nobody has any money, there's a great premium on having some cash, and we thought that having some cash in reserve could give us real power at the bargaining table. So we we said we're going to leave the last ten percent of the fund, which was a billion one uninvested, so we never did invest that,

and those restructurings, for the most part, never materialized. The world turned around much faster than we would have thought. That's quite fascinating. And I mentioned in in the introduction that you have about seventeen distress funds, all told different series. I think that's right. And the performance numbers on those funds, and we rarely tout performance. We don't like to get into the details too much, but I have to mention

these numbers because they're just astonishing. After fees over the past twenty two years, your funds of average annually, that's just extraordinary. Well, my colleagues are exceptional. Um, you're just a buy stand. They're just an innocent boy. Well, the day to day the person who really uh you know, I I help set the scene and make them big

tactical decisions. But the person who actually runs that fund from day to day is Bruce carsh He's been my partner since right as well, right, and uh, and he's just he's just an exceptional strategist, you know, competitor, uh, you know, chess player, what what have you? And he just figures out how to gain these things. We we've always had a great UH stable of financial analysts that

work with us. And so you know, the key is to do a better job than others of figuring out what the what the company that rises from the ashes of bankruptcy is going to be worth, and how to get how to get a piece of that cheaply and UH and they've been able to do that successfully over the years. Now, I agree with you Barry the short term that performance numbers, we shouldn't dwell on them too much. And I love your reciting hours. But but I would remiss if I didn't mention the fact that that is

an unlevered return. Now that's we don't borrow any money to amp up the results. That's just the result of

our investments making it even even more extraordinary. So so the secret to your success is a combination of an outstanding team UH, excellent assessment of what's going on, figuring out the valuation of what things are worth, and and how do you avoid what's been Dick Thaler called the failor called the winner's course, the bidding too much to actually win, and finding yourself with something that you ultimately paid too much for. I think that the secret to

solving all problems. Starts with awareness of that problem. So if you understand that that that winning an auction is not necessarily a a boon, uh, then you you can develop discipline. Uh and UH you know UH. When we started oak Tree, we wrote out the uh the investment philosophy. There are six tenants to it. It's on the website if anybody wants to look. We've never changed a word in over twenty years. And the first tenant says that the that they are the most important part of our

job is risk control. So I'm proud of the performance numbers that you reported, but I'm prouder that I believe they have been achieved with the risks under control. I believe that the first job of the money manager is not to make a lot of money, and it's not to beat the market, and it's not to be in the top quartile. The first job is to control risk. And everybody at oak Tree believes that follows that and I believe that we always have had an effective emphasis

on controlling the risk. So now, when you describe controlling risk, I want to put a little mean on those bones. Are you referring to potential returns relative to the risk you're taking. Are you talking about loss of capital? What exactly is risk to someone running other people's money? Well, to me, you know, the the academics to find investment risk as volatility. I do not agree. To me. The

risk that matters is the risk of of permanent loss. Now, there are lots of kinds of risks, and I put out a memo in which I think I described twenty three or twenty four different kinds of risk. But the one that really matters is the risk of permanent laws. And we believe that we can mitigate that risk by picking in the right industries where the values are lasting rather than ephemeral, by buying debt which is at the top in terms of priority rather than at the bottom,

by doing rigorous financial analysis. You know, really, uh, safety comes from paying less than things are worth and building in a margin of safety. Uh So, only if you fully understand what things are worth can you buy for less. Welcome to Masters in Business on Bloomberg Radio. My special guest today is Howard Marks. He is the founder and chairman of oak Tree Capital. And before the break we had been talking about your chairman's memos, which I find

to be not only required reading, but absolutely fascinating. Um, why did you start the chairman memos? Chairman's memos? What was the thinking beyond that? I wish I knew. You know, I started twenty five years ago. I certainly can't remember back that long. No legislative history, you don't have any notes or anything. It just started. Well, what I would guess is that you know, I mean years ago, I had twenty years in this industry or twenty two, and

I was starting to think to develop the philosophy. What did I believe in? What did I stand for? And what did I reject? Uh? And UH. Two events occurred UH where I thought there was something to be learned from the juxtaposition. So I wrote the first memo. H I had. I had dinner with the chief investment officer of a large pension fund, and he explained to me that in his fourteen years on the job, his fund had never been above the twenty seven percentile or below

the forty seventh percentile. It was solidly in the second quartile of pension funds, and as a result, for the fourteen years overall, he was in the fourth percentage. So, in other words, by not having any huge blowout years which often follows those huge top ten years. He managed to just gradually rise to the top. He never had a top ten year he was he was solidly just just a bit above average. Uh, and in the peculiar math of investing, that made him one of the best

in the world. And then I came back to New York and I and I read about the president of an investment management firm which was having a particularly bad year that year, and he said, well, you know, he says, yes, it's unfortunate, but the truth is, if you want to be in the top five percent of money managers, you have to be willing to be in the bottom five percent. And I said to myself, I am absolutely unwilling to be in the bottom five percent. I don't care if

I'm in the top five percent in any given years. Obviously, my previous discussion had shown that it's not essential, uh, but I sure didn't want to be in the bottom five. So that was that was a good look at two different ways to think, and it was clear to me which one had the appeal. So consistency second quartile over long periods of time put you in that top five or better, and no blow ups and no blow ups. So you start these in this is pre internet. Are

you faxing these? Are you? How are these going out? I'm I'm writing them up and uh, you know, stuffing envelopes and and and putting them out on paper and and uh putting stamps on him and and and throwing them down the drain. Now why do I say down that? Wait? Wait, so every quarter the whole staff gets together periodically, so it wasn't wasn't that regular in the beginning, but at least once a year, I think, just once a year in ninety and once a year in ninety one. And

out they go. And what's the response? Non zero crickets zero response. That's why I say throwing him down the drain? If for all I knew they were being held up by the post office and this was going to investors in your funds and clients of the firm and other assorted well, yes, clients and friends, and nobody picked up the response that because just so you know, in my office, you put out a note and my head of research comes up to me and said, hey, did you see

the marks letter? Yeah, of course I saw it this morning. I'm on I'm on the list like anybody else. Who's half smart has done none of that, you know, you know, just crickets. As I recall it, there wasn't a response in the first ten years, Akade. So you're just sending these out into the void and literally nothing. And I have no idea what kept me going, uh you know, with that lack of a reward, no feedback, none, none.

But it had to be a the process itself had to be somewhat of a reward of itself, yet enjoy it. You clearly are a gifted writer or you like putting words on paper. There had to be something, although I would tell you it has to be a little funny not here. So when did you first start to see kind of like if you were on the radio and you just spoke and nobody spoke back. By the way, nobody is you should know that we're not broadcasting this. This is just my own private collection. Uh So, so

what finally generates a response? When do you finally hear that, hey, somebody is reading these thoughts. Well, I was working on a memo and I put it out on the first day of two thousand and it was called bubble dot com. And basically what it said is that there's so much buzz and hype around technology that I think it's overdone, and I think it's going to cause a problem for the people who are following it blindly. And that memo had too virtues. It was right, and it was right soon.

Being right is not enough, because if it takes you to three four years to be right, everybody's forgotten you by the time the events, Uh comply with your forecast. But trading right plus early equals wrong. Right. But you know, the the tech stocks collapsed sometime around the second quarter of two thousand and and, as I think I wrote in the introduction to my book, after ten years, I became an overnight success. There you go. You're listening to

Masters in Business on Bloomberg Radio. My special guest today is Howard Marks. He is the founder and chairman of Oaktree Capital. We were talking about Wall Streets obsession with forecast. Let me let me give you a quote of yours, and I'm I'm paraphrasing slightly. Uh. When it comes to investing, we are concerned with actually one thing, dealing with the future. Yet it's clearly impossible to know anything about the future.

You can't predict, you can only prepare So the first question is why is the financial industry so in love with forecasts? And the second question is what can investor do about it? Well, if I was competing for a piece of business, and I walked into your living room and I said, you know, look, very I really have no idea what's going to happen in the markets, in the economies, or in rates and in the coming year. And the next guy comes in he says, I'll tell

I know exactly what's gonna happen. You know that guy, I'll get the business ninety odd percent of the time. Now, the truth is he'll give you the business because because because he doesn't know any better than I do. But you know, nobody likes totally ambiguity. Um. And yet you know Mark Twain said, it's not what you don't know that gets you into trouble, it's what you know for certain that just ain't true. I think it's much more valid and much more prudent to admit when you don't

know something than to act as if you do. To say the least, I'm I'm fond of looking at current situations and going back a year to say, hey, how many people last saw the we're saying, by the way, oil is going to get cut in half. Nobody said anything like that. Nobody said in advance Russia's invading the Ukraine.

People had idea there were issues with with Greece. I don't think a lot of people were saying, hey, get ready for a full on bear market in China after the market doubles the first six months of this year, right, So, so no doubt that that's a that's a process. Here's another quote of yours that I really enjoy. We can make excellent investment decisions on the basis of present observations

with no need to make guesses about the future. Well, you know, I believe what are my mottos for myself is that we never know where we're going, but we sure as hell order know where we are. We don't know what's going to happen in the economy, we don't know what's going to happen in the market next year, but we can have a sense for the whether the market environment is hostile or friendly from what's going on around us. What are other people doing, what are they thinking,

how are they acting? Um are are are the people on radio and TV shows wildly bullish? Or are they very cautious. When they're wildly bullish, we should be worried. When they're cautious, we can turn aggressive, you know. Uh. Warren Buffett says, the less prudence with which others conduct their affairs, the greater the prudence with which we must

conduct our own affairs. So if we know that people are throwing money at wild leverage straw sured speculative deals, then we know that we're in an overheated environment, and we should turn cautious. And I think that using indicators like like those can work. Nobody gets timing exactly right. But the question is, uh, can you improve upon a buy and hold approach? Can you improve upon the faulty uh timing that the herd engages in. It makes a lot of sense. Um, here's another quote of yours that

I really like. I called called once called this extrapolation to infinity. And you had said, rule number one, most things proved to be cyclical. Rule number two. Some of the greatest opportunities for gain and loss comes when other people forget rule number one. Explain that, well, I mean, when I was a kid in the early seventies, one of my mentors described to me the three stage is

of a bull market. The first stage, when only a few people believed that things could ever get better, the middle stage, when most people understand that improvement is taking place, and the last stage, when everybody believes things will get better forever. So the point is, uh, you should know which stage you're in, and you should act accordingly. And if you if it's hard to get in in the first stage but desirable but dangerous to get in or stay in in the latter stage, And the question is

can you figure that out? And I believe you can, which leads us to a question. Here we are in mid two thousand fifteen, what stage of the bull market are we in? Um? Well, first of all, it depends on which market you're talking about. You most people talk about the stock market, I think in terms of the credit market or the debt market. So let's let's talk about both. Okay, Okay, Well, first of all, let me

say that the U. S economy is going okay. It We have a gradual, unsteady, halting, unimpressive, but intact recovery and no reason to think that's gonna stop anytime. So, so what we call in the business the fundamentals are a relatively intact in this country. I don't even want to go abroad yet. Uh. Then we have to look at investor psychology. Uh, and then we have to look at valuations. Psychology is a little bit on the positive side. I don't think too many people are very excited about

the future. They're too I don't think too many people are excited about buying today. Um, and yet they are buying. Why I call them handcuffed volunteers. People can't keep money in cash, they can't be money in the bank, they can't keep it in money market funds because they get a return of zero. They can't buy treasuries that yield one or two. So they go out on the risk curve and they buy things that historically maybe they haven't bought because they're so satisfy with returns of zero, one

or two. So there is no alternative form of invitment. And and and so in that context, people look for what they call good relative buys. Well, this is I like this because it's not as bad as that. You know, do you really want to buy something for your investment portfolio because it's not as bad as something else? No? Uh, you know, we'd like to buy great buys, and then we have to look at price, and the answer is on price, there's very little out there today which is

a great buy. You know, the goal of the value investor, our goal at oak Tree, the goal of Bruce Carsh's distress debt funds, which you described, is to buy things for less than their worth. There's very little that you can buy today for less than its worth? Is that true on the debt side as well as the equality? Think it very much is. So we're we're fully valued on on equity, were fairly valued on debt. So where do you look to find value? Well, that's the answer

is there's nothing easy today. I would I describe you asked where are we in the cycle? I say that most assets are on what I call the high side affair high side of fair Yeah, and and in other words, there's nothing which is which which you can buy at or below fair value. Most things are above fair value, some are at the high part of the fair range, and some are at the beginning part of the expensive range. But there are no pronounced bargains. Um, what do you

do in that environment? Well, it's tough. You can go defensive, but if the economy is gonna hold together for another few years. Uh, you know, a high degree of defense today and putting money in cash at a return of zero is not going to be very satisfactory. So the answer is you put money to work, but you do it carefully, selectively, careful for for the last four years. I think it's four years now. Almost of the day, Barry,

the mantra at oak Tree has been moved forward. But with Ocean, I believe that that the outlook is not so bad and prices are not so high that you can't be invested if But on the other hand, the outlook is not so good and prices are not so low that you should be doing it with any aggressiveness. I think you must. The real key question before you get to the granular question of exactly which stocks to buy,

which bonds to buy in which companies. The key question at any given point in time is should your portfolio be aggressive or defensive? What balance do you strike? If you get that wrong, you're not going to succeed, no matter if you're a good stock picker, And if you get it right, you will succeed even if you're a bad stock picker. So the point is, should be aggressive or defensive today, And I would I think personally that you should favor defense. Not exclusively defense, but I think

you should favor defense. So you're a little more balanced in in your perspective in terms of both aggressiveness and defense. But I'm but still I'm favoring defense. I'm not balanced. I'm not. So you're leaning a little more defensive than you. Yes, typically will you mentioned in passing psychology. Here's another quote of yours I want to throw out related to that, the biggest investing eras come not from factors that are

informational or analytical, but from those that are psychological. Just about every investor has access to the exact same information these days. That's describe this if you would. Well, another way I put it is that the key disciplines for investment success well, certainly they include accounting in finance, but but they also include psychiatry. So you have to understand your psyche, and you have to understand the psyche of those around you, and what what is going on in

the marketplace. And uh and uh, I believe today that people are coerced into buying risky securities because they don't like the return prospects on safe securities and that this has pushed up prices in the risky asset classes and permitted um less sound deals to get done. And if those things are true, that that mas. That's the source of my caution today. So psychology not frothy, but valuation fairly fully valued. So you're someone invested somewhat balanced, a

little bit on the defensive stuff. We're fully invested, but but in cautious holdings. So if you'd like to hear more of my conversation with Howard Marks, please check out our podcast extras. You can find them on Apple, iTunes, SoundCloud, and Bloomberg. I mentioned Howard's chairman's memos. Those are all available at oak Tree Capital dot com. Be sure and follow me on Twitter at Ridolts, and check out my daily column on Bloomberg View dot com. I'm Barry Ridults.

You're listening to Masters in Business on Bloomberg Radio. Welcome to the podcast portion of the show. Um, I'm sitting here with Howard Marks. He is the founder and chairman of oak Tree Capital. Howard, thank you so much for for doing this. I really appreciate it. Well, I just want to show my kids that I'm an early adapter. Here you are, You're you're not only on radio, but on Twitter and on periscope. Um, your kids will be

your kids will be impressed with that. So previously you and I had a similar conversation at the Seattle cf A. Was that the beginning of this year. That was um, that was kind of fascinating because I'd only passed through Seattle, I had previously, I had never stayed as long as I did that week in Seattle. And that is a boomtown, isn't it? Boomtown. It's a very nice place to live. Really,

really is delightful. The weather is delightful. We ended up going to Bainbridge Island, which is about as nice a place as uh, this half of the planet has to as to offer. Let's some let's plow through some questions. Uh that we had some stuff that I didn't get to during the radio portion, and then we'll get into some of my my favorite questions. So we did not

get to discuss the fact. I bet a lot of people don't know that when you were at Trust Company of the West, you supervise some kid named Jeffrey Gunlock. There was a guy named Jeffrey Gunlack and and uh uh, I don't know if the supervisor is the right term, but I assisted him in my last year there, all right, And then ultimately he uh he left Trust Company of the West and called you and said, hey, it's not it's something I want to do is go out on my own. What do you suggest and and how did

you respond to Jeff? Well, uh, he actually went out on his own. But the key is that he called us uh and or had a representative call us and said, would you help us get started? Would you you know the big when I started oak Tree eight twenty years ago, people would say, well, what's the biggest surprise? And the big surprise is how much non investment stuff there is to do personnel, premises, tax, insurance accounting. Uh. Yes, and it's and so you know, Jeff said, can you help

us get started? Because you know tc W fired him and he had no preparations made, and he wanted to get up and running, and he didn't want to stumble because then then people would say he wasn't able up to the task. So so uh, we earned a piece of his company double line by putting him in business Organizationally, I'm going to assume that was a pretty good investment. It was a good investment. And and then, and then, and then we bought a further piece because we wanted

to get up to on the accounting rules. If you have we can include our share of their profits. Uh, it's called equity accounting. And so we wanted to be a twenty and uh and we're our happy owners of Double Line. It turns out Jeff was the first show we had done here. And at the time, I think he was coming up on sixty or seventy billion in a u M in an incredibly fast time. I think they just celebrated their fifth anniversary. Is that right? I

think that's not too long. Yeah, So that's really a fascinating You know, you've mentioned very often cash is king and opportunities come along. That has to be one of those great examples of being there at the right place, at the right time with cash, ready to to do what you want to do. Well, it didn't. It didn't take us much cash. It took us some expertise and of course, uh, Jeff's trust in us to to that he would get a good solid foundation, which I think

he did get. Um and it constitutes getting lucky. Barry, you know that's right. As you and I were saying before, it helps to be smart, but being smart is not enough. You also have to catch a break. Lot lots of smart guys. But smart plus preparation plus luck that that that's certainly a secret. Speaking about preparation and not getting lucky. We never mentioned earlier, but it was on my list of things to talk about. You took a small piece, if I'm reading this correctly, of oak Tree and did

an I p O with that. Yes, in two thousand and twelve, how much of the company UM was listed as a relatively small percentage of memories. Yes, I think it was. I think it was about and we've heard for the past ten years how arduous going public is and all the headaches involving what motivated you to say, all right, let's fight through that and become a public company. We had always given ownership of the firm to the

employees from the very beginning. You know, we started off there were five of us who owned a d At the end of that first year, we brought in thirteen more people into the ownership. And we've always had about the employees owning, owning equity, the ones who could who could really determine the future of the company, and we thought they would want to have a way to number one, know the value of their steak and number two monetize it. UH. And you know, we use it as a compensation tool.

And if you're giving people equity, but they say, I, how do I know what it's worth? And how do I know you be able to get out? Then it it doesn't have much power as a conversation tool. So we thought that that that would be desirable. And then for further generational transition UM, as my generation UM moves on one of these days, I'd like to have a way to monetize that value and part of it and turn the rest of it over to the other employees. So I think that public ownership played a key role

in that. But by the way, you mentioned making sure that UH employees had a way to participate. That's a theme I've heard from so many people who have passed through here. Listen, these are the people who helped build the firm. We want to make sure they're fully compensated and and have a steak in the future success of the company. It's a azing how consistently that concept comes up time and time and time again. Well, I might

have something to do with the way you choose your guests. Okay, so you're saying this is not a this is a sample set error, this is not a a full on random I think you may be onto something with that. So so let's go to UM. There's a question I ask all of my guests. But you've talked about this question in the past, so I want to jump right into this before I get into your book. And you

have suggested people read broadly. What's the significance of reading to the investor, I think that you have to see the whole world to understand the importance of things. You have to understand other countries, other political systems, other monetary systems, be they in place today or in history. UH. I think you have to understand different disciplines, the sciences, UM, and UH and so forth. UM. You have to understand how people have thought over the years. UM. You have

to UM. You have to be able to see cycles, and some of the important cycles of the world have taken place in in decades and centuries. UM. And you're not going to get that in the Wall Street General. This more exactly, you need something with the full weight of history written by somebody who's an expert in that

space exactly. So, UM, you know, if you, if you, if you follow people like uh Warren Buffett and Charlie Monger, they say, read broadly and and and the other thing it does is it it's it just makes you think bigger. You know, this business of figuring out whether a company's gonna earn sixty six cents next quarter of sixty seven, this is the bigger pictures. It doesn't help you cope with the big pictures of life, big questions of life.

So so, aside from Dot and Graham, which I know you have mentioned many times, UM, what other books did you find influential? What else do you recommend investors should be familiar with? UM? I have gotten a lot out of a book called The Short History of Financial Euphoria by John Kenneth Galbraith, UM Loved Fooled by Randomness by Nessa.

Nicholas teleb Um, um Against the Gods by Peter Bernstein, which is really a story of of risk of risk and how people evolved their understanding of risk and probability. You know, you can only you you can only cope with the world if you can see things probabilistically. I think it's you know you you you've talked about my dislike of forecast. I don't like people who say this is what's going to happen next year. You put a probability on it, as long as that's a will considered

probability just because it rained. If you say chance of a sunny day doesn't mean you're wrong. It means the ten percent outcome. But so you you you shouldn't say this is going to happen. I'm sure, but you also shouldn't say three different things can happen. I have no idea which you'll be. You know you have to make a judgment about likelihoods and probabilities. That's how you have to live your life. You know you. You decided whether or not to take an umbrella this morning be based

on the probability of rain. Chance of rain at two o'clock. I have an umbrella only because now I'm in a suit and tie. So the downside of was this gets ruined if I'm in jeans and a shirt. Maybe you don't care. Maybe you take the umbrella if it's if it's eighty right, that's right, Okay? So I think you know during the radio interview, you mentioned UH something, which was the title of one of my memos, You can't predict, you can prepare. That was the tagline for I think

it was. I think it was Mass Mutual's advertising program a dozen years ago, and I stole it for a memo because it's true, we don't know what's going to happen in the future, but we have to prepare for the things that may happen. We can't prepare for everything that may happen, so we have to do it probabilistically. And that's what Against the Gods was really about. So you're preparing for the likely outcomes. What do you have to do about preparing for the you mentioned full by randomness?

What do you do to prepare for the black swans? The highly improbable but enormously disruptive possible outcomes what I call the improbable disaster? And one of the most interesting questions in investing is what do you do about the improbable disaster? Uh? You can't prepare for every eventuality. If you ensure, if you spend money for insurance premiums against every possible outcome, then you will have protected against every negative outcome and you'll have no money left, right, So

so it's it's really interesting. You have to you have to, uh, maybe there are some possible courses of action which offer an attractive expected value on average, but which entail some outcomes that you absolutely can't stand. Maybe you just avoid that. Uh. You know, I always say that I'm not interested in being a skydiver who was successful at the time. Uh, So I don't skydive. Um. But then you you say in some ca says that's a risk I can live with.

That's I either don't think it's going to happen, or if it does happen, I don't think the consequences will be uh unbearable. And then you take those concuences. We face that back in oh eight, we had the big eleven billion dollar fund you were talking about and the distressed asset fund. That's right, and we're investing in the aftermath of the Lehman meltdown when everybody thought the world was gonna end. That was that was an improbable disaster.

We concluded that we would invest nevertheless. So so you mentioned um a short history of financial euphoria, You mentioned Fooled by Randomness? What other books really come to mind? You know, I have on my night table Charlie Monger's um port Charlie's Almanac, which is which is this this thing? And I'm saving it for the winter because the weather has been Peter Kaufman did a great job on the Almanac and and he conveys a lot of wisdom. Um.

I think, I think that's a really good idea. UM. I know you had mentioned other things of Buffett you put out your letters Buffets Annual Letters or something else that you have mentioned. You really enjoyed everything. They're great. Um, They're really great. There's a book out called The Warren Buffett Way for people who are interested in Carol Loomis No, no Carol No. I think was Bob Haxtrom who wrote

and and uh. I think we're on the fourth edition of The Warren Buffett Way now and uh and Bob asked me to write the the introduction really the book, and so I did an interest what I thought it was an interesting thing? I said, what is it? My theme was what makes Buffett Buffett? Uh? And that's what the introduction is about. Have you ever gone to any of the Buffett Annual events. I did go to one.

What was that like? Well, it's it's a it's a cultural phenomenon, you know, it's the scale is great, the atmosphere is great. Everybody it's a. It's a. It's a you know, it's a. It's a whole full of happy people, of good feeling. You know. The the adulation of of Warren and Charlie is something to behold. I can imagine lots of people. They've made lots of people very very let's call it comfortable over the decades, and and that would that sort of response wouldn't surprise me. You know.

One of the things I found fascinating in your background is you minored in Japanese studies. Did that ever come in handy with anything? And I'm gonna put a stop on this because We've been going so long with this, I don't want to give away too much of Well, I think it hates. I think it helped shape who I am, for one thing, and it helped shape the way I think. Uh, in what way? How did how

did you study? The main thing was there's an element in Happanese philosophy called mujo and uh it's kind of uh. The literal translation is the turning of the will of the law. The turning of the wheel of the law. And in other words, uh, nothing ever stays the same. Change and impermanence are are are forever. And I think that it's very good to understand, uh, that that things don't go on forever as they are, that there will be change, and to prepare for and adapt to it.

So I never heard the term mujo, but it certainly reminds me of Heroiclydus. The only constant is changed. It's it's a similar philosophy. Um. So earlier you also mentioned one of your mentors had advised you about the three phases of a bull market. Who who were your early mentors? Oh, just the people I worked with at that city, the people I met in the investment business back in back in the early seventies, as I recall, you know, it's a long time to remember, Barry, but we have to.

I think we used to have a group called the third Third Day Group, the Third Thursday, which met for lunch on the third Thursday of every month, you know, And I was let's say it was seventy three, I means I was twenty seven years old. I was a kid, but I got to hang out with Lee Cooperman, who I know was one of your guests. And uh, I was saying earlier, he's a boy from the Bronx, You're a boy from Queen's right. We're keeping it local. So

Lee Cooperman was part of that Third Thursday. As I recall again it's a long time ago, but you know, the people from from Cumberland Group, which was one of the uh one of the early hedge funds, and uh maybe Steinhardt Finer Berkwitz and mating people like like you know, and uh maybe Carnie Awson who was at Jennison. Jennison was the first institutional investment boutique formed around the sixty nine, as I recall, or eight, and uh, you know, yeah, I didn't have a I didn't have a anybody whose

knee I sad on. I didn't have any one person uh that that, But I just I was lucky to hang around with a bunch of smart people and pick up snippets here and there. You strike me as a very astute observer of both human nature and other investors. And I suspect you were. You were picking little bits and pieces off of all those guys. Maybe a magpie. Okay, that was not what I was thinking of. But if you want to go with Magpie, I'm happy with that.

So those are the investors who who helped Were they formative, they helped shallp shape your view or these people who kind of added minor course corrections over time I think helped change shape my view, you know. I mean it's it's it's really intangibles. Uh. You know. I I have all these adages that I use, and you know, I can't remember who gave him to me, but I got to ended up with quite a collection of those, and

they come in very handy. Uh. And then just you you you watch people think, you know, I mean you watch people think, or maybe you should say listen to people think. But I mean, you know, maybe maybe thirty five or forty years ago, uh, listening to how Lee Cooperman uh analyzed Henry Singleton and tele Dine. You know, he used that as an example one of his face when he was at Goldman SAX. I've heard that example from other people, and the great thing about it is

that nobody liked tele Dine. Henry was was not one of these managements who gave out forecasts breakdowns of prophets. He said you're on your own. And I went to see him on my first business trip in my life nine and and you know, we said, well, yes, could you tell us what you're gonna earn per year for the next five years? This was, you know, common question or management. We could you break down your earnings by by by division? And and Henry said, that's your job,

I run the company. Uh. And most people didn't like that. Most people thought he was crusty. He was crusty, Uh, but with the reason to be to not say, let me chew your food for you, your analyst with the number. Well, the other thing is that, you know, uh, most managements want their stocks to go up because they have options or what have you. I think Henry wanted the stock to go down so that he could buy out the public.

And you know, he started off as a paid employee of the company and he ended up as a very major shareholder at the end because he used the month company's money to buy back a lot of stock uh from the public at low prices. He did he realized that his he had that are interest in having the stock be low than high. There's a great book out now called Outsiders. I don't know if you're aware of that. It's about it's about eight Maverick CEOs and how they

ran their companies. Uh. And he's one. Uh and he's one of he's the he's the leader, he's the man. He's chapter one and how to tell the Telegugne story ultimately end well, the tell Dine story ended up that that he owned it, ended up owning a major piece of the company, and the stock ended up being very valuable. We weren't they ultimately am I misremembering this? Weren't they taken out by somebody? Or well? I think they were taking out taken out in pieces? Yes, But of course

tele digne is is is it? Name doesn't exist anymore as far as I know. No, I think you're right. Yeah, well we'll have to we'll have to look at But I mean he viewed as he viewed a capital as a tool that you can that you can use to the betterment the company. And you you you you can you can use it to buy the stock back when it's cheap, not when it's expensive. And you don't do buy backs when the stock is high, and you don't

do acquisitions with stock when the stock is low. So and then and these people in the in the people who follow outsiders and follow this movement, they're called capital allocators and and this is a very good way to manage a company. I think we've we've seen so much in terms of stock buy backs the past few years after you've run up in the markets. Um, what's your

thoughts on on share buy backs lately? Because history tells us that management has a tendency to overpay for their own stock, and when stocks are cheap, they have a tendency to be a little timid and not want to look stupid when every hey conserve your cash as opposed to saying my stock is cheap on buying it here? Well, probably just like mother ridholds. My mother said by low sell high, and why would you do the opposite? It's

easier to do them. It's easier, it's comfortable, it's emotionally, you know, it takes a lot of off to tell you, guys who are out buying stock when when you were raising the distressed funds, did you get feedback from clients you'r or from potential investors? Hey, listen, I know you've got a great track record, but you're crazy. The world

is coming to an end, like, did you get pushed back? Well, no, the main the main pushback we got, Remember we started to raise the funding, oh seven and um, and the main pushback we got in the beginning of seven it was there's not going to be any distress. The world is too good. You know, everything's going smoothly, and it's going to go smoothly forever. And that was a year

after housing had already begun to roll over. Yes, but nobody took notice, right, And I think some subprime subridy more well subprime more goages began to soften in uh the first or second quarter of or six, and but they people didn't generalize it to the rest of the world, and nobody said, well just a minute there, people applied terribly weak standards in extending subprime mortgages. Maybe they extended we maybe they applied weak standards every place. So what

does that mean? If if this weak mortgagees everywhere, that's a negative, of course, but also it implies to me, it implied that the system had been faulty because people had been making uh bad decisions and they and they weren't making him in just one place, I mean, Oaktree turned very cautious in oh uh four five six, Why, Well, on everything we do. Uh, but most of what we do is debt. But we turned very cautious. Why because we saw what we thought were ridiculously unsafe deals being issued.

And you know, I would walk into Bruce's office, my partner Sheldon, my partner Larry, and Richard, and we would say, look at this piece of John, can you believe this got issued. There's something wrong if a deal like this can get issued. And so again understanding what's going on around us. If we're in an environment in which faulty deals can readily be issued, there's something wrong with the environment.

What's amazing is how long it takes from the recognition of hey, this is a lot of junks till the rest of the world figures it out. It literally takes years. Well, you know, somebody that famous, somebody I can't remember who it was. One said, Uh, it takes a lot longer for things to happen then you think it could. But then they happen much faster than you think they will. You know, makes perfect sense. Yes, you're right, things things don't it through to investors, uh, other than very slowly.

But then when everybody has that ah moment and says, you know we're in trouble. Then the collapse comes quite fast. Think back to the famous irrational xuberans speech in you still had four more years of market upside before a pretty fast and furious collapse there there too. I wonder if that that three to four year number is is because you said in O four you started to become cautious. It's a it's a sample set of two, but that that run of four years after looking back after the fact,

seems to be kind of an interesting coincidence. It's a small sample. But but but you're right. I mean, look when Alan Greensband said I I I believe I detect signs of irrational exuberance. That was at six thousand, and it exceeded ten. Right. Uh, if I have my numbers right now, that's about yeah. So you know, and the people. The point is that anybody who listened to green Span and in six thousand got out of the market by

oh nine, people ruled him an idiot. Uh. And by the way, everybody had Buffett written off at the beginning of two thousand because they said he's passed his cell by date. You know, he's missed his tech bubble. What's wrong with him? This this value investing is you know, that's old school. That's not gonna art anymore. Well, the greatest quote you know comes from Galbrai's uh, Short History of Financial Euphoria, and he says the he talks about the the short comings of the markets. He says, one

is the is the limited span of memory. Uh. And he says that anybody who remembers the old bad events and cautions against the recurrence is dismissed as past their prime. Uh and uh and old basically an old foggy here. That's my turn, not his. Uh. And then you get a reminder that history is elevant. Right. There's another quote, and I don't remember with Galbraith or someone else who said, one of the distinguishing characteristics about people in finance is

their steadfast refusal to learn from history. And it's really true. It's in oh seven o eight, it was as if two thousand had never happens. Well, all of six years had passed. But you know that the point is that this this dismissal of the past has helpers, has handmaidens, if you would, and and and and one of them is that in oh six it looks like if you're merely willing to disregard the lessons of the past and and plunge in, you can get rich. M And what

do people want more than anything else? You know? I always imagine, uh, you know, those more movies about Las Vegas, and and that you got the angel on one shoulder saying don't do it, it's not the right thing, and the devils sitting on the other shoulders saying, you know, do it, it will be fun. Well, the devil always wins, right, also wouldn't have a movie. Well in the investing business, the angel sitting on one shoulder says, don't do it. It's not prudent. You know, trees don't go to the sky.

It's too good to be true. The market risk is elevated. But on the other side, the devil sitting there and he says, do it, you'll get rich. And who is that devil? Because the handmaiden to forgetting history very often is that what have you done for me this quarter? The investor class, So you and I are in the business you a little longer and a lot more money

managing of managing other people's money. There is a very very consistent thing that takes place every cycle where the investor class says, this prudence thing has gone on long enough. Everybody else is getting rich, why aren't you making me rich? Well, people respect, people respect managers who exhibit proof. At the bottom, they say, boy, I wish I wish I'd been with that guy. He didn't lose his clients any money. But at the top, when the market has doubled, nobody wants prudence.

They want the guy who full throw the most out of that double This is what this is. This is herd behavior, and uh, this is the This is the ticket to losing money and the ticket to preserving capital is something called contrarian behavior. Very very hard to do, very hard to stick with, which is why you mentioned by low so high, the crowd seems to find itself constantly doing the opposite. When when that energy, when that excitement and enthusiasm is there, they're looking to um, They're

looking to buy a top and and move forward. It's very very easy. The crowd finds it very easy to buy things that have been rising for a while and very hard to buy things that have fallen. So in the last few minutes we have I have a handful of questions I'd like to ask everybody, and one or two more quotes of yours. So so let me run through these pretty quickly, and and we'll see if we can get you out. I know we have a call

waiting for you shortly. Um. One of the things you had mentioned previously that I always found interesting was clients need a creed. Whether it's beta versus alpha, risk control, return maximization. What's the significance of a creed? Why do investors require one? Well, it's not really clients. I think it's investors or money managers need a creed because you have to have something to stand by, you know, uh, A philosophy, philosophy, a religion. If you will, what do

you do, what do you don't do? What do you believe in? What do you do not believe in? Uh? You know, if you if you don't have these things, and then what are your signposts of your of your activity, of your behavior. What would you say, I buy things that go up. That's not enough. You have to you have to have a system for the kinds of things you buy and how you figure out that they're a buy and and how do you when you and when you get off the trend and do you believe in

growth or value? I believe in forecasts or not forecast? You believe in maximization or or risk control? Uh, there are many many things that you should have to make a decision about, um and and Uh, I believe you can only you know. The people that I know who are great investors all have They can state what it is they do. MH. They have a philosophy, they have freed and it could be summed up very very very simply. So, So let's let's go through one other quote of yours

that I really like. Um and this this hearkens back to your your discussion on probabilities. The future does not exist. It is only a range of possibilities. We have to understand that most outcomes will be determined by luck. Explain that, well, the world and the economies and the markets do not run according to you know, Newton's laws of physics. Uh.

You know. And if you hire an an electrician to come in your house and he does it right, then you know that if he puts in a light switch over here and he throws that switch, the light will go on over there every time. That's not the investment business. There's no, there are no there are no relationships that are that dependable. There's a lot of randomness. You know. Sometimes the company announces good earnings and the stock goes up.

Sometimes they announced good earnings stock goes down. Uh, And it just isn't that reliable, um and so um. You know. We have to keep that in mind, and we have to allow for other outcomes than the one we think should happen. One of the things I try to point out is that should does not mean will, and it certainly does not mean will right away. Overpriced, if a stock is over priced, that doesn't mean it's going down tomorrow.

You can stay over priced for a long time or go higher, you know, Uh, cheap stocks get cheaper than that's right. Lord Kane said the market could remain uh in so irrational longer than you can remain solving. So you can't. You can't bet your all your money that

the things that should happen will happen promptly. And that's why I feel we have to think of the future as a range of possible outcomes, and we had we might bet on the one we think will happen, but we should give allowance for some of the others, Now, how much allowance which of the others? These are the hard questions, Like I said before, how much do you

how much do you allow for the improbable disaster? You know, in Fooled by randomness to lab talks about alternative histories, the other things that probably reasonably could have happened but didn't. We're thinking about and and and The point is that the world is an uncertain place, just to say the least. So speaking of uncertainty, you've been in the industry for a few decades. Now, what have you noticed that has changed? Um, what's the most important changes to the financial industry? And

is this a good thing or a beat? Well, the biggest single change is that it has become much more preoccupied with the short run. And that is very negative for the people who participate because but it's very positive for the people who for the people who like to take advantage of other people's mistakes. The point is, many people believe, you know, we used to buy stocks five six years at the bank. Uh. Now people think that if your owners for five or six months, it's a

long time hold. And and uh and so uh you know, I I believe that you should figure out how to make money in the long run and stick to that. Now a lot of people say, no, there is no long run. Is the long run is just a series of short runs. But but but I don't I don't go with that. And and you know, forty seven years ago, when I started working at City Bank, at the end of the year, it took a couple of days to figure out how we did that year, to compute our

rate of return. Then you got to the point where you got it the same day. Then you got to the point where you could get it at the end of every every month, then to the point where you could get it at the end of every day. And now every money manager worth is sold has the thing on his Bloomberg screen which shows his return at that moment, by take by take. And that's a negative. I think it's a negative because that's not uh, that's not what you should be thinking about. What did I make so

far today, what did I make this month? And that kind of thing. You know. UH. My son Andrew uh is UH is one of my most valued advisors, and he gave me some great inspirations for my UH memo on liquidity UH, and one of them was if you don't. If you don't think you can hold a stock for five years, don't even think about holding it for five minutes. You know. Uh. The real way to build wealth in the long run is to find a limited number of things with a lot of potential and not too much risk,

and day with them for the long term. And and I the thing he gave me that I thought was the greatest, that made the greatest impression on me. He said, when you look at a chart of a stock which has gone up for twenty years, and you look at that chart longingly, and you say, boy, I wish I'd been on that stock. Think of all the days if you bought it on the first day. Think of all the days on which you would have had to talk yourself out of selling. Everybody looks at those charts and say,

oh my god. You know, uh, Apple, it's up from five bucks to five hundred bucks, and all you had to do was buy it at five. And I once had a friend who's talked to me about a piece of property that could have brought X decades ago at a very low price, you know, And I said, yes, And as soon as it got to two X, you would have sold it. You have to stay on for the long run. And so I think, I think that this short sightedness is the worst single to development and

per and and and ubiquitous. So before I get to my last two questions, I would be remiss if I did not mention the most important thing, which is your book, which Warren Buffett, I want to give you this this. I want to listeners to hear this quote because it is just so um poignant and really um sums it up perfectly. Buffett said, When I see memos from Howard Marks in my mail, they're the first things I open and read. I always learned something and that goes double

for his book. What was the motivation of of putting the book together? And how gratifying is it to get that sort of feedback from a Warren Buffett? Well? Uh, number one, As I mentioned, I've been writing the memos since I've been thinking one way the other since nineteen seventy and uh, you know, I always thought that when I retired, I would write a book and pull the themes of the memos together. And and the truth is

I got a note from Well. I was approached by Columbia, who was the publisher of the book Columbia University Press, and they asked me to write a book. And then I got an email from Warren and and he said, uh, if you write a book, I'll give you a paragraph for the jacket. So that was enough. Uh and so and you know, Warren has been a great inspiration to me.

Um and uh and uh you know you just learned so much through associating with him, and and uh, the opportunity to to do something that he suggested was something too good to pass up, to say the least. And and now I know we we're tied on time. Let me give you my last two questions. I asked all of my guests. First, what sort of advice would you give to somebody just graduating college and and starting out

in the financial business. Christopher Morley, the English writer, said, there's only one success, to live your life your way. So you know, I think that investing is very interesting, uh discipline and obviously can be lucrative. Um, but it's not for everybody, and you should figure out if it's for you. The last thing you should do is go into a career because everybody else is doing it, or because it's hot, or because people say you can make

a lot of money. You know, you have to spend your life in your career and you're not going to get another one. Uh, So why wasted on something that's not for you? Uh? You know it's been great for me and it is simpatico with my with who I am, but it's not for everybody, to say the very least. And and then our final question, what is it you know about investing today you wish you knew when you began forty seven years ago? Um? And I love that

you stop and really contemplate these questions before jumping into them. Well, I think that the whole aspect of number one contrarian behavior and number two, uh, understanding what's going on around you and basing your activities uh in response to that behavior. I think these are the keys. You know, when you're a kid, you come out, you start thinking that if you can just find a stock whose earnings are going

to rise fast, that's the key to success. Uh. And then as you do it longer, you learn that there's so much more to it. So it's it's situational awareness first and then knowing where in lens of your contrarian um is that Howard, Thank you so much for being so generous with your time and staying with us. Um the full geez, almost ninety minutes. Uh. People want to find your memos. It's at oak Tree Capital dot com. You have the full history of news. I think they're

almost all there. Some were. The ones that were originally written on papyrus are not available, but they're almost in the book. And the book, you know, give us the full time. It's called it's called the Well. The first book was called The Most Important Thing Uncommon Sense for the Thoughtful Investor. That came out in Columbia University Press.

And then a year or two later they brought out something called The Most Important Thing Illuminated, which has an additional chapter and commentary from myself and a number of prominent investors, and it's annotated along throughout the throughout the book. So you say something and other people explain what you mean. Howard, thank you so much for this. You've been listening to Masters in Business on Bloombug Radio. I want to thank Mike bat Nick, my head of research, Matt my engineer,

and Charlie Vollmer Uh, my producer. If you've enjoyed this conversation. Looked up an inch or down an inch and iTunes, and you could see any of our prior forty nine UM Masters in Business. You are our fiftieth and and thank you so much for your time pleasure. You're listening to Masters in Business with Barry Dholts on Bloomberg Radio