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When did making plans get this complicated?
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It's time to streamline with WhatsApp, the.
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Secure messaging app that brings the whole group together. Use polls to settle dinner plans, send event invites and pin messages so no one forgets mom 60th and never miss a meme or milestone. All protected with end to end encryption. It's time for WhatsApp message privately with everyone. Learn more@WhatsApp.com shares in the big Banks are up on earnings. We break down why? And while the markets are flush today with positive news, just like those bank earnings, I sit down with New York Times best selling author Andrew Ross Sorkin to explore what he sees in the market now that could remind us of the infamous 1929 crash. Wednesday, October 15th it's blue markets Daily and I'm Ann Berry. More market details to come. But first, today I was joined in studio by Andrew Ross Sorkin, the New York Times best selling author of Too Big to Fail, the founder of DealBook, and the co host of CNBC's Squawk Box. Well, Andrew's written a new book, 1929 Inside the Greatest Crash in Wall Street History and How It Shattered a Nation. So for context, here is a snapshot of that year written in Andrew's own words. He he writes, In 1929, the world watched in shock as the unstoppable Wall street bull market went into a free fall, wiping out fortunes and igniting a depression that would reshape a generation. Now, I devoured this book. I read it in just two days. And it brings to life the personalities and the sentiment that drove the market up. New technologies, new consumer access to credit, new media and information sources, new global flows of money, new newly democratized access to stock trading, new regulatory regimes, new political priorities and the old institutions, old networks that added fire to the flames and then tried to shore up the damage. And a reminder, as familiar as this may all sound, I just described the book's depiction of the roaring 1920s and its aftermath. Now I spoke with Andrew about the risks and opportunities he sees that may feel familiar again. Now we talk about where he invests his money and who in the public eye today may remind us of some key characters of the past. So stay with us for our conversation. But first, a word from our sponsor capital client group. Now our producer John and I were talking about some other podcasts that we listen to.
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That's right. Lately I've been enjoying one called the Power of Advice. It explores how some of the best lessons don't come from a classroom. They come From Experience on the Power.
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Of Advice, a new series from Capital Ideas and Capital Group. You'll hear from CEOs, investors and founders about how they built careers, took risks and reinvented themselves.
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And if you're starting your own journey, this is the kind of advice you won't want to miss. Published by Capital Client Group Inc. And.
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Now my conversation with Andrew Ross Sorkin. Andrew, I've read your book from COVID to cover. It's right here. I've got my stickers in it.
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B
Thank you so much.
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A
So you are an extremely high profile figure in the world of global finance. Everyone talks to you, everyone listens to you. Is there a risk that your book, the launch of it right now, the buzz it's getting, the attention it's getting, the impact it's having. Is this the book and is this the moment that could actually be the catalyst for a crash of this market?
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B
I certainly hope not. That's not the goal of this book. If anything, the goal is to educate people about this period of time. And I do think there are some parallels to today and I think there are important lessons in that period. I think we've learned some of them already and I think there's some that may be forgotten that we need to spend some time focusing on. But if anything, I hope that in fact, actually it doesn't change the sentiment. It actually puts the focus on where we are in the market and prevents us in truth, from going off of a cliff.
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A
Okay. So I hope not is not the same as. No, it's not. So there's a possibility that this could be the moment.
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B
Well, and by the way, if we do have some kind of correction or crash even, yeah, I'm hopeful that it would not be a crash a la 1929 that turns into a Great Depression. I mean, I think that when people think about that crash, there were a whole number of dominoes, the crash being the first domino, but then a number of policy errors that I try to narrate in this book that goes from 1929 really to 1933. And so my hope is even if there is a hiccup, it's more of a hiccup than an actual crash. Even if you look at 1999, for example, the dot com bubble bursting, I would put that more in the hiccup category than a full on crash.
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A
Well, let's talk about some of those policy hiccups and then let's talk about what could happen given where the world is today. So take us through what some of those missteps were as the government tried to contain the crash.
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B
Well, there was. I mean, there's so many mistakes. So after this crash happens, and remember that it's not just that stocks fell in value, it's that most ordinary Americans who had invested in the stock market had done so with remarkable amounts of leverage. They had been walking into brokerage houses for the first time in their whole life. They'd never seen the stock market go down before where they were putting down a dollar and the banks and the brokers were lending them $10. So if the stock went from $50 to $20, it wasn't that they just lost $30, it was that they were mortgaging their homes. So that had a real demonstrable economic impact, and you could see the impact of that. And then in Washington, you know, you had President Hoover, who was being whispered in the ear by folks like the Treasury Secretary, Andrew Mellon, who was a true capitalist with a capital C. And his view was, you know, if you have great success, great. And if you have great failure, great. And let them suffer. You know, there was a sense of austerity rather than putting money into the system. There was a sense of let's raise taxes, possibly the worst time you could raise taxes on earth. There was a sense of let's implement tariffs. Now, President Hoover had spent a lot of time in 1928 during the campaign trying to get farmers, frankly, to vote for him. And one of his pledges was that he would tariff all these other countries to help them. Yeah, well, that proved to be a terrible, terrible decision. So. And then you had a Federal Reserve, which I would actually argue to you, was basically sitting on their hands in part because of the political implications. Because back then, I would argue to you, the Federal Reserve was not an independent actor.
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A
It was quite new, though.
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It was. So. And that's why I think they were being whipsawed by the politics of the moments. They were new. They were worried about the fate of their own institution and they were worried about the politics. And so here we are having a debate in America today about the, the independence of the Fed. And I think one of the lessons actually is you do want to have an independent Fed, because when you're feeling the politics, that is a problem.
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So one thing that the government that the US did not have then was the kind of fiscal deficit that we have now.
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B
Correct?
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Right. You did not have the level of national leverage that we have today. So let's say the correction comes. Yes, there's going to be one coming. You've said that in other interviews, it's not where, it's not if, it's when, invariably.
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And I don't feel that I'm out of consensus there. You know, I think folks like Jamie Dimon and David Solomon have said the same. I talked to Paul Tudor Jones just a couple of weeks ago. He said we are in 1999. October of 1999 is where he said it. But by the way, October of 1999 means that the market still has 40%.
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To go up and six months, right? That's. That's sort of how the calendar would work. So suppose we have the correction, the correction comes. What levers are the left, right? Maybe we reverse the tariffs, maybe there's more, another set of interest rate cuts. But we can't have Keynesian fiscal simulations. Surely, if that happens, what are the levers left to try and reignite an economy if it goes south?
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B
Well, I think that one of the things that would happen likely is that hopefully you'd have a Federal Reserve that would flood the banking system with. I mean, I think that's what would happen a la what we did during COVID a la what we did in 2008 after, after the crash then. And by the way, the crisis in 2008 was a good example of when you have to do things that are politically unpopular, right. You have to bail out oftentimes the. What looks like the arsonists and that, I mean, and that's something that people really hate. They didn't do that in 29. They should have. Again, politically unpopular thing to do. But those are the kinds of things now, you're right, it's not. It'll be. By the way, one of the reasons I think gold is so high right now is because you'll be debasing the currency as you're doing all of these things, but that will be the only true way out. The other thing I would just say about today, it's a little bit different. We don't know. And this actually worries me though. We don't really know where all of the leverage and debt is in the system anymore. So much is living in the private credit universe as opposed to actually in the banks. I can't tell you that that's. Some people argue that's better. But you know, I think there's a connection still between those private credit firms and the banks, these liquidity lines. So are they really disconnected? And I think this will be a grand live experiment if we ever get there. And let's hope we don't.
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Well, we're Going to come back to that because there have been recent bankruptcies that have started to shine a light on that. But before we get there, something else. It's a question for you. Could you just talk about this one part of the book. I loved it that you painted the picture. It's 1907.
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Yeah.
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What does J.P. morgan do? Do you remember this?
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B
I remember it very well. With his library back in the day, as the Panic of 07 was taking place, he effectively locks a group of bankers in a room and effectively says, go figure it out. And it was a period of time, though, interestingly to me, where there was still a view that, you know, a couple of great men can get in a room and make some decisions and make things happen. And the truth is, in 1929, Thomas Lamont, who was running J.P. morgan, effectively tried to do the same thing, but he couldn't pull it off because things had gotten so out of control that it wasn't just that a couple of great men could do anything anymore. And so that's. I think that also we are now in a global scheme where it's very challenging. I think it was challenging. 29. I think it was challenging in 2008 where somehow you can just get a handful of people together and fix things. It didn't happen, by the way, to try to save Lehman Brothers, interestingly enough.
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But it did stem the bleeding, right? We had Warren Buffett.
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Yes.
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Right. We had Hank Paulson, who was a titan out of Goldman Sachs. We did see Wall Street. Right. We saw Jamie die.
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But it required the federal government, but it required. It required the federal government in particular required the Federal Reserve to do extraordinary things that again, to me were so unpopular. And the truth is that Ben Bernanke, who was then the head of the fed, did his PhD thesis at Princeton on the Great Depression. This is what he spent his time learning about. And he will tell you that those are the lessons we're talking about, were the lessons that he took with him.
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So let's talk about the process for you of writing the book and stitching together the pieces of the puzzle over an eight year period and how you did it. And I want to just go back to 2021, okay? At that time you were about halfway through the book, right? So you're sitting there in 2021, in the thick of it. We see Robinhood capturing the public imagination, access for the retail investor, a massive theme, and with it trading on margin.
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The whole idea of democratizing financ dimensions.
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We see meme stocks coming to life. Speculation. We see Metaverse, Capex. Right. Excitement about a new technology. In your book, it was auto and radio. We see payment for order flow.
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Yes.
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We see SPACs coming out. Right. Shell entities, by the way, we saw that Goldman Sachs issuing one in 1929. We see NFTs and crypto 2021. Were you sitting there going, hang on a minute, I'm four years into my research. I'm still starting to see little signs that I've seen this in my research of my book 1929, 1000%.
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I thought I was writing a book about 1929. And it is a book about 1929. It's a character driven story about these fascinating individuals. And I wanted to understand their motivations and their incentives and why they did what they did so that you could really try to actually piece it together. As a reader, I think we all have a general understanding something bad happened in 1929. And I'd read some great books about that period. But I also loved books like Barbarians at the Gate and Den of Thieves where you really got to understand who the people were. So that's what I was trying to do. And yes, in the process of that, all of a sudden these themes that I'm reading about in the papers that I'm interviewing and reporting on in real time are matching up so eerily in this very strange way with the characters and so much of the story from 29. I'm trying to think back to 21. We were in the pandemic. Interestingly, by the way, you'll appreciate you asked about how I was piecing it together. During the pandemic. I wasn't allowed inside libraries because a lot of libraries were closed. The only way to get into a library was some students were allowed in because they had a thesis that was due. So I would find students, I would pay students to go into libraries for me and I would pay them by the hour. And I would say, you know, box 152. You have to take a picture of every page in box 152 and send it to me by Dropbox. And that was a sort of elaborate wild process. But I do remember interviewing Vlad Tenev in the middle of this and thinking, wow, that's what was happening. What was happening on Reddit during that period was a little bit like the, like a, a very transparent version of the investment pools of 29.
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A
The other thing that was coming about. And let's roll forward now to 2023. We're going to get back to current In a second 2023, Silicon Valley Bank. Yes, Teeters, JP Morgan steps in. We saw first, you know, First Republic go down. We saw Janet Yellen at the time step in. Remember that weekend? And the government moved very quickly. One of the things that captured the narrative then was the speed with which information was disseminating on social media that was perhaps causing people, corporates to go and pull their deposits. Right. A social media driven potentially run on the banks. In your book you talk about how there was an astrologer who had 100,000 people on her newsletter you talk about the launch of Time and the way in which journalism changed completely so that original reporting started to become derivatives of reporting. As you look at how information flows today and being an information provider yourself, do you look at that and go, there's just nothing we can do. We're in a fake news believing world. People don't trust the media. There's no trusted source contagion. When it comes, it's going to be catastrophic.
- [15:24]
B
Well, so the good news, there's good news, bad news. I would actually argue to you that things are much more efficient. Yes, there's bad information out there, but the ability to correct that information today is much more efficient than it ever was. Let me just explain. You know, one of the big problems in 1929 was actually a technological problem, which was that you had a board literally at the New York Stock Exchange with the stock prices on that board that were woefully out of date. I mean literally by hours. So you could be investing thinking that the stock was what it said on the board, but it was five or six hours behind. You know, when we all look at pictures, you know, those famous pictures of all the people that are in the streets around the New York Stock Exchange as the crash is happening in 1929. The reason that all those people are there is literally because they don't know what's happened to their money. They can't get the answers at the brokerage houses, the brokerage houses and their stocks, they don't know what's even happening. And so they're physically going down to the exchange to try to find out. I like to believe that given that you can look at this now on your phone. Yes, you can get bad information on your phone. And that can create its own problems. I'm not suggesting it can't. But you know, if you were on a steam liner, which people were trading stocks back then, you were two days out of date. And if you had heard a bad rumor, there was nobody there to correct it.
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A
So let's talk about misinformation in a different area. That's the rise of prediction markets. And I think it was last week there had been bets being placed on who was going to win the Nobel Peace Prize. Do you remember that?
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B
Yes, I do.
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A
And it looked as though someone had made a large bet and correctly predicted who was going to win. And it's prompted a lot of discussion around is this inside insider trading? Fast forward to yesterday. Robinhood announces it's looking to grow in prediction markets. How do you feel about this?
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B
I'm very uneasy about prediction markets, in truth, because I think the opportunity to manipulate seems high. You know, I think the folks who run Polymarket and the folks who run Kalshi would tell you that it's impossible or that because the market is so large and so liquid that it shouldn't be manipulatable. I like to think that's true. But I don't know enough to be. To be totally honest with you, I don't know enough about where we really are. I think there's clearly a benefit to looking at the prediction markets as a signal as you're thinking about decision making in all sorts of ways. So I actually think it's a unique signal. I like that idea. I like the conceit. I'm fascinated by. Do I think that if you are betting on, you know, when Taylor Swift and Travis are going to get married or where they're gonna get married and somebody makes a big bet that it's at this hotel, at this location, that they somehow figured that out from the florist who's doing the wedding. How we're supposed to think about that, I don't know.
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A
Right. The tips.
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B
But by the way, unfortunately, right now I would argue that there's all sorts of similar kinds of trading in meme stocks or not meme stocks rather, but meme coins. I mean, a completely unregulated space.
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A
You've had your own Meme coin. Well, somebody else had a Meme coin.
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B
Named after you, Sorkin coin. And some people got very wealthy. And my children like to remind me that we did not. So. And I've seen that up close about sort of how that worked. That was very much like the investment pools of 1929 too. So, yes, I worry about the manipulation piece. And the question is, what is the regulatory framework around these things and what constitutes insider trading? What constitutes fraud in that space? I still find it almost fraudulent that we allow Congress and folks who work at the government to. To invest in practically anything. Not in anything, but individual stocks. I think it's either being a blind trust or, you know, ETFs or mutual funds or things the same way most journalists who are in this space work. So. But yes, prediction markets are a fascinating new space and I'm very intrigued by it. And I, I look at it, I look at it constantly and I find it to be, I mean, I think you, you'd agree it's often correct. Not always, but often.
- [19:50]
A
Brew Markets Daily is sponsored by Public, the platform for those who take investing seriously. John, if you were to create a portfolio from scratch right here and now, what would you want in it?
- [19:59]
C
I mean, okay, at the very least, stocks, options, bonds and crypto.
- [20:03]
A
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- [20:14]
C
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- [20:22]
A
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- [20:37]
B
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- [21:06]
A
We've seen enough examples now where that's true. It is though. You know, when I read about it, I think, gosh, is this another example where regulators have been criticized for not keeping up with innov? And let's go back to private credit, because you did raise it. Private credit's now been around for a long time. You go back to the early 2000s, you saw mezzanine funds. This isn't new. The scale of it's new.
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B
The scale of it's new.
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A
Where do you think the regulators are in keeping up with it or not?
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B
I imagine that they're not because partially the whole premise is that it is a private credit market. So the kinds of regulations that historically were we approached banks with, they don't, they don't have the same rules. And by the way, people Like Jamie Dimon have been screaming about this from the rooftops forever, I think.
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A
But has it. Has he been screaming from the rooftops because he doesn't like that they exist and they're a risk? Or because it's boxed JP Morgan out of certain deals because, you know, leverage has become available elsewhere? How much of itself?
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B
So I'm a believer that nothing's black and white and therefore the answer is probably both.
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A
The answer is yes. Okay.
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B
The answer is probably both of those things. I think it's a combination, invariably a combination of those things. But I think when you think about private credit, there's two issues. It's how boxed out, meaning is the private credit from everything else. How connected or not is that private credit institution or fund to an actual bank? And then increasingly, how connected is that private credit fund to the insurance complex?
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A
Talk about that.
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B
Okay. Because so much of what's happening now, whether it's Apollo or KKR or some of these other firms that have effectively built an insurance operation which is the engine room for these private credit funds. And it could become a problem one day for these private credit funds and more importantly for the insurance funds, if in fact they can't pay out. And they would tell you, look, that even though they are private institutions and not regulated necessarily by some of the financial, you know, by the Federal Reserve, for example, they'd say they are regulated by state regulators who regulate the insurance complex. Now, by the way, that may be true, but guess what? There were a lot of state regulators that were regulating firms like AIG in 2008. And we know what that movie looked like.
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A
People, I don't think, are talking enough about the insurance aspect of that.
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B
I think it's the insurance piece and the bank piece.
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A
Yeah, I'm glad you're hitting it.
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B
And I just don't think I know. The truth is, I don't think anybody knows enough about where. Where the imbalances lie.
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A
Let's talk about another area that people think that they know a lot about. But as you try and track where the money flows, it's getting harder and harder. And that's this AI funding and this idea of circular investment. Some of the money that's going, for example, into data centers, OpenAI turns up, they backstop a contract, and then leverage is being raised against those contracts. Do you look at that and say, no, this is okay, because I understand the capex flows here, or do you look at that and say, need to dig in and perhaps be cautious?
- [24:17]
B
So I think caution is the watchword. I'M very excited about AI. I think this is like the Internet, but I think the Internet. We had a hiccup in 1999, so I wouldn't be surprised if there was another hiccup. The question is the sort of the size and scale of this. So when you hear that OpenAI has made these remarkable commitments to buy these chips and to use these data centers, and these data centers are going to be built and there's going to be real cash that's going to be used to build those data centers. The issue is, of course, that OpenAI, at least currently, isn't making a profit to technically be able to pay for all of that. So when you have these sort of circular deals, or what used to be called round tripping, which was maybe the more critical phrase, it's a little unclear. You know, what's. It's. I shouldn't say it's unclear. I think it's very clear what's happening. The thing that's interesting to me about even the Nvidia transaction with OpenAI, though, which is at $100 billion transaction, is it comes in $10 billion tranches. And so it's not like it's all happening tomorrow. And if in fact it appeared that OpenAI wouldn't be able to pay for these things, I imagine they could stop it at some point. I'm less worried, and maybe I'm wrong about this, about the biggest players at the moment, because I think there's going to be an almost too big to fail aspect to them. I worry more about just the entire startup culture that's grown up around this and how many of those firms won't have the financing longer term. I'm worried about that. And I'm also just worried about, as these large language models become so good, whether they can actually just do the business that so many of these startups are trying to do.
- [25:57]
A
Let's also talk about the other source of funding for all this, which is venture capital. Firms have become bigger and bigger and bigger. Yes, the largest ones, the most, quote, blue chip ones. And we're seeing this democratization of access to private capital, which includes private equity, which includes venture capital. Do you look at this and go, we might be starting to expose the retail investor to more venture capital and things like the retirement funds. Right at the time these same funds are deploying capital at maybe very high valuations to AI. Is this just really bad timing potentially for this democratization?
- [26:32]
B
Well, so I worry about what I describe as a transition period that's going to take place as these funds get inside your retirement program. So all of a sudden there's going to be potentially hundreds of billions, if not trillions of dollars that could go into the venture capital and private equity world that were not there before from the retail or retirement community. And how that manifests, I think is going to be complicated because it is at these very high numbers. The whole world is at this sort of, I don't want to say peak numbers, but the valuations are very high. And most of the private equity firms and venture capital firms, while the top decile, have made a fortune for their investors over the years. This last couple of years have not been great. And so there could be this sort of hot potato game where they start to sell certain assets from one fund into another fund. Just the amount of business that's going on from private equity firm to private equity firm and venture capital, that is a scary business unto itself. The bigger issue that actually concerns me in the retirement space as it relates to venture capital and private equity and private credit is the way these funds are being created. They are what's called semi liquid funds. They sort of wrapped in the veneer that they're like a stock. And basically you can buy it and you can sell it whenever you want. But that's not really true if in fact too many people run for the gates at the same time. They can actually put gates up in the provisions. And it's very much like B reit. And if you followed what took place with them, there was a period of time where people had to wait patiently to get their money back. Interesting, because either these firms have to sell enough assets to actually raise the cash to actually pay you back, or enough other people have to effectively invest and put money into these businesses. And then people think of that as like a Ponzi scheme, as the money's coming in and going out. But because of the structure of them, they are inherently fragile. Now the firms would say that we're not fragile, it's in the provision we tell you what the deal is upfront. That's true. But if you happen to be a retiree who needs the money and you're in the, and you, you sort of catch the wrong cycle, that could be a problem. And then the last piece that, that I do worry about as it relates to private funds in the public space is the mark to marks and what some people call mark to make believe. This idea that there aren't necessarily always, you know, the navigation in terms of what the valuation is is oftentimes being set by the manager. And yes, hopefully there are actual auditors and third parties. But I think that we have to probably create a much stricter independent auditing system of these valuations. And I think it would upset these firms greatly to have some of these sort of super third parties come in and say this is what it's really going to be right now. Because invariably anytime the public market moves around, the private market does not move around as much. People would say that's a feature, not a bug. That right there is no volatility.
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A
Long term view is what they would say.
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B
They would say, but. But if you're creating vehicles where you can get in and out, which is what they are, it changes the dynamic.
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A
Whether it's private assets or public assets, there is one set of cheerleaders really saying to American investors, this is a fantastic time to get in on investing in America. And that's the White House.
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B
Yes.
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A
When this administration has had its time, do you think that there will be a look back to those moments like Post Liberation Day? Do you remember I was actually on the New York Stock Exchange floor when this happened and there was noise coming. That announcement was going to come from the White House and then I think an X post went up or a true social poster saying this is a great time to buy stocks. And then a bunch of tariff negotiations were announced. When the dust settles five years from now, is legal action going to happen, do you think?
- [30:34]
B
What kind of legal action?
- [30:36]
A
I mean, if a CEO got out there and jumped up before earnings and said now is a great time to buy stock, there'd be repercussions.
- [30:44]
B
Oh, for sure. I don't know. I mean, I have such mixed views. I'm so uncertain myself as to where we really are right now. If I'm being totally transparent with you about this, there's part of me that looks at what's happening and says, you know what? Maybe we haven't thought as a country enough about resilience and national security. And it's important that we manufacture these things here in the US and if we don't do these things, we're going to be at the behest of every other country in the world. And that maybe five or ten years from now we will say this was a fabulous and important decision strategically. And then there's another part of me that says that we're going to look back on this and say this was completely crazy and it goes against the sort of economics that we've learned about for the last hundred years. And you know, if we can't do something efficiently, somebody else should, and we should get it at a lower price as a result of that. I mean, I have to. I remember talking recently to a CEO of a major car company in the US who said, 10 years from now, the rate things are going to, we will all be buying very expensive cars that are not as good as the ones that you could buy in other countries. So. And how will Americans feel about that? It may not matter how Americans feel about that, but when you go on a trip to Asia or you go on a vacation to Europe and you get inside a BYD car, maybe you'll feel differently.
- [32:04]
A
I don't know, soundless streets because of all the EVs. So if I looked in your brokerage account right now, Andrew, what would I see you holding?
- [32:12]
B
Oh, that's a good question. So I am not allowed to own individual equities at all. I never have been allowed to do that. So I'm a very boring. Almost. I'd be like Warren Buffet's sister, I think, where he always says in the letters that you should just buy the S and P and buy indexes and things like that. And so that's literally what it is. And a bit of cash.
- [32:36]
A
Would I see crypto related indexes? Nothing. No crypto. You know, even the picks and shovels argument around it.
- [32:44]
B
I've always been a little uncomfortable about crypto for a different reason, which was I thought early on that if I owned crypto, which I sort of wanted to. To be honest with you.
- [32:55]
A
Yeah.
- [32:56]
B
That I was on tv, it was a very volatile asset. And I didn't know. I didn't want to be the person who owned crypto and was telling you bitcoin was a great thing or a bad thing. And so my view was just not to. Not to own it at all. I never did that. Clearly a mistake. I mean, many years ago. I'll tell you, you'll appreciate this. I was at a conference and a young man came over to me and said, I have this app. I'm starting an app. It's a crypto app and I'd love to show it to you. Can I send you it? I'll send you $5 a bitcoin so you can see the. You can see how it works. Not five Bitcoin, but $5 a Bitcoin. I think this is 2013 or 14. I said, sure, send it over. I'll look at it. I still have it on my phone. That young man was Brian Armstrong.
- [33:40]
A
Oh, there you go.
- [33:41]
B
I still have the $5. Never sold the $5. I sort of use it as a proxy of just to see how things are going. I think it's maybe worth a thousand dollars today or something like that. If I ever sell it, I'll send it off to charity. But that's my only crypto story.
- [33:58]
A
There you go. 200 times. Return completely inadvertently. So two last questions for you, Angie, because I know we're coming up on time. You spent eight years researching 1929. Again, fantastic read. It's riveting.
- [34:10]
B
Thank you.
- [34:12]
A
What was one thing you came across that shocked you the most in the course of your research?
- [34:19]
B
I don't know if it was a shocking, but I think I have. It's more theoretical than, like, an individual thing. I mean, look, the characters. To me, each character was like another person in a way that shocked me. Meaning I looked at, you know, Charles Mitchell and I thought, is that Dick Fold? Is that Jamie Dimon? Is that Michael Milken? Who is that person? I'd look at John Raskov and say, there's Elon Musk.
- [34:43]
A
Well, it's human nature we want to find.
- [34:45]
B
And there's. And there's Carter Glass, and he's Elizabeth Warren. Right. And so you think about these different individuals. But I actually think more theoretically. I thought of two. Two big sort of things kept coming back to me. One is speculation seems to be a dirty word. We all think. We always say speculation. Terrible. And here I am sort of preaching that we need to be careful about speculation. We do. But speculation is the twin of innovation. You almost need a little speculation for us to ever have any innovation. Somebody had to speculate on Elon Musk and Tesla in the beginning, when it seemed completely, completely and utterly insane. And so there's gotta be a balance. And I think we need to figure out what that balance is. And I think that's the hardest part. We're all trying to find that balance. The other thing is just maybe the human condition, which is. I think we all want more. I think that's just who we are. There's a great line I don't. Did you ever see Wall Street 2? The movie Wall Street 2? Not as good as the movie Wall Street 1.
- [35:48]
A
That one's iconic.
- [35:49]
B
And I don't know if it was Shia LaBeouf or it was Michael Douglas, but one of them says to the other, what's your number? Meaning, you know, what's the number? That you would basically walk away from it all. What's enough for you? What's enough? And he looks at him and he goes more, more. And I think that that is been the human condition in 1929. It's the human condition in 2025. And how you get away from that if you need to get away from that, maybe that's an important motivating factor. But I think that's something that I spend a lot of time thinking about.
- [36:21]
A
Huge thanks to Andrew Ross Sorkin for being here. Let's take a quick break. And when we come back, all the deal making we've seen so far this year has meant a great reporting quarter for the big banks. We're going to hit the highlights. It's 4pm on the east Coast. There's the closing bell. The markets are wrapping up for the day. Now we don't have a ticker tape so we'll throw it over to our human ticker. Our producer, John.
- [36:42]
C
Another day of volatility on Wall Street. The S&P 500 finished up 4.10of a percent. The NASDAQ was up nearly 7. 10. And the Dow finished 4 flat. Some market headlines, it's earnings season with reports rolling in this week from the major banks. We're continuing to see deal making fees as a boon to the bank's bottom line. Profits at bank of America were up 23% on income of nearly $8.5 billion last quarter. And profits at Morgan Stanley were up 45% on income of 4.6 billion. Both results were more than $1 billion higher than what analysts were expecting. Shares in both bank of America and Morgan Stanley were up nearly 5% today. And the U.S. army announced a power initiative that seeks to build small nuclear reactors that will be commercially owned and operated. It's unclear which companies will be awarded these contracts, but shares in nuclear power company NuScale were up over 15% on the news. And finally, Ann, yesterday you talked about the success that Domino's Pizza is having, staving off weaker consumer sentiment with popular items like stuffed crust. Well, now this pizza news coming over the wire. Apollo Global Management has once again offered to take Papa John's private at $64 a share. The situation remains fluid and there is no agreement. But the speculation sent Papa John stock up 10% today, closing at around $54 a share, 10 bucks under the proposed price.
- [37:56]
A
A busy week of earnings still to come, not just this week, but also we're really at the early innings of this. So the next couple of weeks we're going to be very hard at work watching it all unfold. That's it for today's brew markets Daily.
- [38:07]
C
Brew Markets Daily is hosted by Anne Barry and produced by John Crisseau, Tariq Abdelatif and Emily Millian. Our technical director is Uchenawa Ogu. Audio assistance by Brittany De Taco. The president of Morning Brew, Inc. Is Devin Emery.
- [38:18]
A
Wake up tomorrow with the Morning Brew newsletter and tune in to Neil and Toby on Morning Brew daily. See you back here tomorrow, same time, same place.
- [38:37]
B
And Doug, here we have the Limu.
- [38:39]
A
Emu in its natural habitat, helping people customize their car insurance and save hundreds with Liberty Mutual. Fascinating. It's accompanied by his natural ally, Doug.
- [38:52]
B
Limu is that guy with the binoculars watching us. Cut the camera.
- [38:56]
A
They see us.
- [38:56]
B
Only pay for what you need@libertymutual.com savings. Very unwritten by Liberty Mutual Insurance Company and affiliates. Excludes Massachusetts.