Ladies and Gentlemen, Mr. Harvey Schwartz

Summary

The Compound and Friends Podcast: "Ladies and Gentlemen, Mr. Harvey Schwartz"

Release Date: December 27, 2024
Host: Downtown Josh Brown, Michael Batnick
Guest: Harvey Schwartz, CEO of Carlisle and Board Member at Carlyle
Duration: Approximately 50 minutes

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1. Introduction and Background

The episode kicks off with a brief promotional segment by Harvey Schwartz for Vaneck and Public Bond accounts, highlighting opportunities in clean and efficient energy solutions like nuclear power. Following the advertisements, Josh Brown and Michael Batnick introduce the podcast, setting the stage for a deep dive into Harvey Schwartz's illustrious career and his current role at Carlisle.

2. Early Career of Harvey Schwartz

Harvey Schwartz shares his humble beginnings in the financial industry. Starting his career in 1987 at JB Hanauer, a municipal bond firm in Livingston, New Jersey, Harvey recounts the challenges of cold calling high-net-worth clients to sell tax-free municipal bonds.

Harvey Schwartz [05:46]: "You make as many phone calls a day as you can, say, 'Hi, I'm Harvey Schwartz,' and they'd hang up immediately. One out of fifty might pick up."

Harvey's early career was tumultuous, especially during the infamous 1987 stock market crash, which left a profound impact on him.

Harvey Schwartz [06:19]: "Markets are very volatile. Something I didn't understand. They don't teach it in school, really."

3. Transition to Citibank and Goldman Sachs

After facing setbacks and nearly filing for personal bankruptcy, Harvey was fortunate enough to secure a temporary position at Citibank, thanks to a friend's intervention. His tenure at Citibank was transformative, eventually leading him to a rigorous training program that set the foundation for his Wall Street career.

Harvey Schwartz [09:02]: "That was really where I'd say my more conventional journey on Wall Street started."

Harvey's move to Goldman Sachs was facilitated by a colleague from Citibank who recognized his potential. At Goldman, Harvey made significant strides, particularly in structured derivatives and trading, positioning himself as a key player during the firm's navigation of the 2008 financial crisis.

4. Insights from the 2008 Financial Crisis

Harvey reflects on his experiences during the 2008 financial crisis, emphasizing the importance of understanding systemic risks and the fragility of the financial system.

Harvey Schwartz [16:20]: "Understanding the vulnerability, it goes back to what we were talking about before the show. These moments are incredible points for all of us to pause and say, hey, what brought us here?"

He highlights two critical turning points that signaled the end of the crisis for him: the implementation of the Troubled Asset Relief Program (TARP) and the transformation of Goldman Sachs into a bank entity.

5. Evolution of Capital Formation and Carlyle’s Strategy

Post-crisis, the capital formation landscape witnessed a significant shift from institutional investors to wealth management. Harvey discusses how Carlisle has adapted to these changes by prioritizing wealth management and launching innovative credit solutions.

Harvey Schwartz [36:31]: "Of the many significant trends that will drive the evolution of capital formation, this is probably the most significant for the next 10 or 20 years."

Harvey emphasizes the global nature of this evolution, noting that it's not just a U.S.-centric phenomenon.

6. The Shift from Institutional to Wealth Investors

Harvey and Michael delve into the transition from traditional institutional investors to a broader wealth investor base. They discuss the growing importance of wealth management in providing capital for business growth and the diversification of investment strategies to include more illiquid assets.

Harvey Schwartz [37:58]: "It's like the early days of ETFs. And it will be as significant."

Harvey underscores the increasing role of private equity and credit in wealth portfolios, driven by the changing needs and goals of modern investors.

7. Future of Wealth Management and Private Markets

The conversation shifts to the future trajectory of wealth management, particularly the integration of illiquid investments in retirement accounts like 401(k)s. Harvey anticipates a substantial shift in how individual investors approach portfolio construction, with a greater emphasis on long-term, diversified assets.

Harvey Schwartz [46:39]: "It's going to happen. All that happened because it should happen."

Michael adds that the flexibility in portfolio construction is essential for both institutional and individual investors, highlighting Carlisle's strategic initiatives to cater to this evolving landscape.

8. Conclusion and Highlights of Carlyle’s Success

As the podcast wraps up, Josh Brown highlights Carlisle's impressive financial metrics, including a 17% year-over-year increase in assets under management to $447 billion, record fees, and substantial dry powder growth. Harvey lauds the team's efforts in mobilizing growth and repositioning the firm for future success.

Harvey Schwartz [33:54]: "We've changed the carry protocols. We've elevated people, introduced new CFOs, and repositioned the firm for growth."

Josh and Michael commend Harvey and his team for Carlisle's resurgence and strategic direction, noting the firm's alignment with market trends and its ability to leverage its iconic brand in the wealth management space.

Notable Quotes & Timestamps

• Harvey Schwartz [05:46]: "You make as many phone calls a day as you can, say, 'Hi, I'm Harvey Schwartz,' and they'd hang up immediately. One out of fifty might pick up."

• Harvey Schwartz [06:19]: "Markets are very volatile. Something I didn't understand. They don't teach it in school, really."

• Harvey Schwartz [09:02]: "That was really where I'd say my more conventional journey on Wall Street started."

• Harvey Schwartz [16:20]: "Understanding the vulnerability, it goes back to what we were talking about before the show. These moments are incredible points for all of us to pause and say, hey, what brought us here?"

• Harvey Schwartz [36:31]: "Of the many significant trends that will drive the evolution of capital formation, this is probably the most significant for the next 10 or 20 years."

• Harvey Schwartz [37:58]: "It's like the early days of ETFs. And it will be as significant."

• Harvey Schwartz [46:39]: "It's going to happen. All that happened because it should happen."

• Harvey Schwartz [33:54]: "We've changed the carry protocols. We've elevated people, introduced new CFOs, and repositioned the firm for growth."

Key Takeaways

• Resilience and Mentorship: Harvey Schwartz's journey underscores the importance of resilience and the impact of mentors and influential figures in shaping one's career trajectory.

• Adaptation to Market Changes: The financial industry's landscape has dramatically evolved post-2008, with a notable shift towards wealth management and alternative investments.

• Strategic Positioning of Carlisle: Under Harvey's leadership, Carlisle has effectively repositioned itself to capitalize on emerging trends, focusing on wealth management and innovative credit solutions.

• Future of Investments: The integration of illiquid assets into retirement accounts and the diversification of investment strategies are poised to redefine portfolio constructions in the coming decades.

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This episode offers invaluable insights into the financial industry's evolution, the strategic maneuvers of a leading investment firm, and the personal journey of a seasoned executive navigating through market turbulences. Whether you're a seasoned investor or new to the financial landscape, Harvey Schwartz's experiences provide a roadmap for resilience, adaptation, and strategic growth.

Transcript

[Harvey Schwartz]

Today's show is brought to you by Vaneck. Listen up. There is a huge wave of demand currently and on the horizon from hyperscalers for data center power, and many of them have already looked to nuclear as a solution in the short to intermediate term. Why? Because it is both clean and efficient. It has one of the lowest emission profiles among energy sources and it can produce power24.7, unlike renewable sources that produce electricity intermittently. To learn more about getting your exposure to these companies, visit vaneck.com NLR that's vaneck.com/NLR Listen up folks.

[Josh Brown]

Time could be running out to lock in a historic [e-mail] the Fed just.

[Harvey Schwartz]

Did a rate cut a couple of weeks ago. There's more on the calendar, so who knows how long these rates are going to last.

[Josh Brown]

That might be great for you if the Fed is cutting. If you were in the market to buy a home, it's not great for the interest that you're currently earning on your cash. What's the solution? Possibly the Public Bond account. If you want to lock in a 6% or higher yield with a diversified portfolio of high yield and investment grade corporate bonds, you might want to act fast. Go to public.com compound for more information. Michael Read the disclaimer okay, what are you on your emails?

[Harvey Schwartz]

It's over. Brought to you by Public Investing member FINRA and SIPC. As of 92624 the average annualized yield to worse across the bond account is greater than 6%. Yield towards is not guaranteed, not an investment recommendation. All investing involves risk. Visit public.com disclosures Bond account for more info.

[Michael Batnik]

Welcome to the Compound and friends. All opinions Opinions expressed by Josh Brown.

[Josh Brown]

Michael Batnik and their cast mates are.

[Michael Batnik]

Solely their own opinions and do not.

[Josh Brown]

Reflect the opinion of Ritholtz Wealth Management.

[Michael Batnik]

This podcast is for informational purposes only.

[Josh Brown]

And should not be relied upon for any investment decisions.

[Michael Batnik]

Clients of Ritholtz Wealth Management may maintain positions in the securities discussed in this podcast.

[Josh Brown]

Ladies and gentlemen, welcome to a special edition of the Compound and Friends. My name is Josh Brown here with my co host as always Michael Batnik. Michael Sarah, hello, hello hello. We have an incredibly special guest today. We are so excited to be able to bring you this conversation with Harvey Schwartz. Harvey, before I do your full official introduction, I just want to tell you you're to me an icon on the street, somebody that I've always wanted to talk to. I have a million questions for you. We won't do a million today, but just thank you so much for being A part of this. We appreciate it.

[Michael Batnik]

Well, Josh, it's fantastic to be here. Michael, great to see you. I like the attire. Josh, I'm a little concerned you didn't wear the vest, but it's fine. We can go with it.

[Josh Brown]

I thought it would look crazy if we're both wearing the vest, talking to Carlisle. Okay.

[Michael Batnik]

We should have gotten you a hat or a tie or something.

[Josh Brown]

Let me do the official intro. For those of you who don't know, Harvey Schwartz is the Chief Executive Officer at Carlisle and a member of the Board of Directors. Carlyle is a global publicly traded investment firm with over $447 billion in assets under management. It's telling me to call you Mr. Schwartz. Harvey formerly worked at Goldman Sachs from 1997 to 2018. I went to public school with his last position as president and co Chief Operating Officer at Goldman. This is, from my perspective, the first time that we're talking to a CEO of a publicly traded financial company. We talk to a lot of chief investment officers, talk to a lot of chief strategists, but I think this is a first for us. I wanted to start by just talking a little bit about the early part of your career. Then we're going to get into Carlisle today. Sound good?

[Michael Batnik]

Fantastic. And really. Well, first of all, being the first, it's an honor for me to be here. Love your show, love what you guys do.

[Josh Brown]

Thank you.

[Michael Batnik]

And we should have a fun conversation. And I think it's my first podcast as a CEO of Carlyle. So first for both of us.

[Josh Brown]

Okay. Very cool. You started J.B. hanauer in 1987. What is that? It's a bond shop. Or.

[Michael Batnik]

You say it like you don't know.

[Josh Brown]

You don't.

[Michael Batnik]

So I graduated from Rutgers University in 87. Rutgers, certainly back then, didn't really have a path to what you might think of as conventional Wall Street. I didn't know there was a Goldman Sachs. I didn't even know there was a J.P. morgan. I was a kid from New Jersey, and it was a bumpy ride coming out of college. It took me a couple months to figure out what I wanted to do. I knew a friend who said, hey, I think you'd be a pretty good salesperson. He worked at this muni bond shop in Livingston, New Jersey.

[Josh Brown]

You took a gap year?

[Michael Batnik]

Well, that. Yeah.

[Josh Brown]

Okay.

[Michael Batnik]

I would say there was a gap in my years, but we can come back to that.

[Josh Brown]

But you weren't hard charging, like, I gotta be on Wall Street. It just kind of happened.

[Michael Batnik]

No, I would say to say I was an underperformer in high school would be a real exaggeration of my performance. I had a lot of challenges in high school. I didn't apply to any colleges. The fact that I ended up at Rutgers is sort of a miracle story where an angel intervened and got me into Rutgers. But when I came out, I started at JB Hanauer, which was a municipal bond firm, small shop. There are a million of them back in the day in Livingston, New Jersey.

[Josh Brown]

Okay. And you're basically calling people and saying, here's the rate and it's tax free. And so I'm going to kind of put you down for.

[Michael Batnik]

Back then you could cold call.

[Josh Brown]

Yeah.

[Michael Batnik]

So you sat there all day long. You had, you know, there was like a rubber thing. People you have to really.

[Harvey Schwartz]

I did it. Who are you calling? Is this retail investors or munis?

[Josh Brown]

So it's like high net worth?

[Michael Batnik]

Yeah, it's like high net worth clients, but they give you back. Then I think it was done in Bradstreet cards. You'd come in, you'd have 500 in front of you. You make as many phone calls you day say, hi, I'm Harvey Schwartz. They'd hang up immediately. One out of 50 might pick up a phone call.

[Josh Brown]

I did that 10 years later, but with blue chip stocks. But the same exact thing. Dun and Bradstreet index cards.

[Michael Batnik]

Yeah. So these were high net worth individuals who likely were already owners of municipal bonds. And you would say, hey, I'm offering 12% tax free, by the way. I'm not just picking that number. You could actually get 10, 11, 12% tax free back in the day because 1987 and the whole rate environment was completely different.

[Josh Brown]

Okay, so you're doing that. And very quickly into your tenure as a cold caller at the muni bond shop, the stock market has a crash. We were talking about this off camera for a moment, but It's October of 1987. The market crashes 22% in a day. You end up moving to Citigroup, but you're still early enough in your career that you're not exactly sure what you're going to do. But what's the lesson in that tenure at Citigroup for you or what do you take away from that experience?

[Michael Batnik]

Well, that whole journey was. That was a complicated time for me. So it actually was my first day on the muni bond trading floor, which is. These are not big Wall street training floors. There's like a couple hundred people in seats. That was the day the stock market crashed. It was the first day I was cold calling. So of 500 people I cold called that day. I bet 499 of them hung up on me like, hey, kid, what are you talking about? So that day specifically, what I remember is I didn't really understand what was going on. I was just a kid. I remember at the end of the day when it calmed down, I turned around and across this little trading floor there was a gentleman with his head in his hands. And he looked up and he was crying and he was probably in his 40s. And I said to someone, hey, why is he crying? He said, oh, well, he manages a lot of his family's wealth. They lost a lot of their wealth today. That was a profoundly important experience for me because I remember thinking without understanding anything, but the visceral energy of that was, markets are very volatile. Something I didn't understand. They don't teach it in school, really. They teach it more now, but they didn't then. Markets are volatile. You can have personal vulnerability and you have to be really thoughtful about how you approach this whole engagement. It was more impressionistic because that visceral fear. I turned out to be exceptionally bad at this job. I didn't really build a book of business. You probably did. Eventually I left. I tried to start a couple businesses that didn't work out. And when I was pretty close to filing personal bankruptcy, a friend of mine intervened and got me a job as a temp in the back office at Citibank. That's what they called it. And that's how I got to Citibank a couple years later.

[Josh Brown]

But that's so that's like your. So that's like your entree to big bank, big Wall Street. Okay.

[Michael Batnik]

And I joined Citibank at a really pivotal time in Citibank's history because I was part of the cost cutting teams. But I was hired as a temp. I managed to convert myself to a full time employee. And then someone else intervened, gave me a shot at becoming a credit analyst. I went through that full training program. Citibank ran an amazing training program, truly amazing. Six months, very intense. And I came out of that. And that is really took me years. But that was really where I'd say my more conventional journey on Wall street started.

[Josh Brown]

It seems like there's a recurring through line to all this, which is that people are recognizing something in you. You keep saying they intervene. It's probably in their own best interest. They probably see you as somebody who can help them too. Or do you think it's just people Being nice. What is it about you, do you think, that attracts the attention of people who can help you get ahead or get to the next rung?

[Michael Batnik]

I think they're pretty special individuals. What I'm talking about.

[Josh Brown]

You got fortunate.

[Michael Batnik]

I don't think this was self interest in the slightest. To the extent to which it was self interest, I think it's because they're good people and that's what they do. For example, with Rutgers, I hadn't applied to any universities. I applied to Rutgers because it was the least expensive, it was the cheapest, and it was the closest to where I lived. This is back in the day when you didn't find out online that you were actually going to be admitted. So I waited for the envelope, the envelope came. There was nothing in it, so I barely needed to open it. I knew I didn't get in, but I was working at a health club, which is probably hard for you to imagine, but I was the instructor, so you have to picture me. Thinner hair, more fit. And there was a woman that used to come through, name is Linda, and she was a Rutgers graduate. And she constantly asked me, hey, have you heard from Rutgers? I said, finally, yes. She said, this is ridiculous. She wasn't like an influential alumni. She wasn't someone like you, who people call and they know. And she called up and she basically pushed the university and said, listen, you've made a mistake here. You have to interview this kid. They asked me to write an essay about why I had so poorly performed in high school. And I went, explain yourself. No. And I went and I had an interview. And I remember thinking, I don't know how to dress for an interview. And I was bouncing at a bar in New Jersey, and there's this one guy that used to come in wearing a sport coat and cowboy boots. And I thought, okay, he looks pretty good. So I went out, I bought a sport coat and cowboy boots. That's how I showed it for my interview. And I got in. So when I. So I don't think there's any self interest in that. I think it's a miracle it occurred. So I think there's mentors in life and there's angels. She's an angel. There's another guy at Citibank who really intervened. And I won't bore you with these stories, but he really intervened to get me into that training program. I was not a natural choice for that training program.

[Josh Brown]

What made you say, now is the time to actually get serious about my education? You go back, you get an MBA from Columbia. Yeah. Did somebody tell you to do that or did instinct just say, all the people that I emulate seem like they have these advanced degrees. I should go do it?

[Michael Batnik]

So I grew up in.

[Josh Brown]

A bit.

[Michael Batnik]

Of an unusual environment. Both my parents were super well educated. My father had a PhD in chemistry at a time when PhD wasn't as common. My mother had a master's in education. So super, very well educated people. Unfortunately, they suffered both very severe mental illness. So my mother suffered from what you would call today bipolar disorder, and my father suffered from schizophrenia. Back then in the day, the medication wasn't as good, the treatment protocols weren't as good. So they suffered quite significantly. And as a result, that in a big way contributed to my significant underperformance in high school. But education was always imprinted on me as a very important thing. So after not applying to colleges and I saw all my friends go off to schools like University of Maryland and other schools, I thought, hey, I should do this? So it was always in me to do it. But I had to mobilize. And when I went to Rutgers, the one fear I had was I didn't have the capability to perform as a student. And I had to prove to myself. And what I learned at Rutgers was I was actually capable of performing. But more importantly, I think it was the first time in my life I realized I liked learning. And my first class was economics. That was just part of the curriculum. And I loved it. I loved everything about it. And that kind of triggered me along the way.

[Josh Brown]

Okay, so then you. So then you get your MBA and you end up at Goldman and I guess, what are you, late twenties at this point?

[Michael Batnik]

So I go to Goldman When I'm 33.

[Harvey Schwartz]

Was that intervention or did you make that one happen?

[Michael Batnik]

That like a lot of things on Wall street, one of the people on the training desk. So at Citibank, I went from being a temp to being hired into the back office. A guy by the name of Glenn intervenes. That's another angel story. He gets me into the training program. I did really well in the training program, which was kind of a surprise to people because I was the kid from Rutgers from the back office. Then I go from there to being a credit analyst to the trading floor to do structured derivatives in the mid-90s. And one of the gentlemen from the trading floor went to Goldman Sachs, brought somebody over, they brought me over. The guy who originally brought me over ended up being one of my co heads. We ran the trading businesses during the financial crisis. So it all links Together that way.

[Josh Brown]

And you end up at J. Aaron, which is the commodity shop within Goldman. I think Lloyd Blankfein came through also.

[Michael Batnik]

Yeah. Purchased in 1981, long before I got there, was considered the worst acquisition Goldman Sachs ever made.

[Josh Brown]

The purchase of Jay Aaron.

[Michael Batnik]

Correct.

[Josh Brown]

Okay.

[Michael Batnik]

And then ended up being a fantast contributor to the firm's success, profitability redefined the fixed income business. Lloyd Blankfein came from Jane Aaron, Gary Cohn, lots of other really notable people.

[Josh Brown]

What do you think it is about the prevalence of commodity guys making it into the top ranks at Goldman? Is it like a understanding risk thing or what is it about that particular aspect of Goldman makes those people so highly valued later?

[Michael Batnik]

I think over that period of time, the evolution in trading and what was happening in markets was so dynamic. You're talking about a period from 97, let's say up through 2008, where all trading markets were evolving as fast as they've ever evolved, whether it was equities or fixed income. It was an extraordinary period in technological evolution. You had the launch of credit derivatives, really, electronic trading. You had rules that changed all of equity trading and drove commissions from a couple of pennies down to zero. And so all of that required a certain dynamic way of responding to markets that I think was just part of the culture. And they also came from a very demanding, disciplined, financially focused orientation that just along with those markets, was a real chemistry for success.

[Josh Brown]

Okay, I wanted to get into a little bit about your rise at Goldman because it's pretty remarkable, the timing. You end up effectively being one of the top people at the firm at a time that probably is, in hindsight, Goldman's most challenging moment, the 2008 crisis. And you're. You're on the front lines in a lot of different ways. You hold a bunch of different titles. But I guess when you're going through it, it's like another day of work. But when you look back on it now.

[Michael Batnik]

Different day.

[Josh Brown]

Yeah, we look back on it now. I mean, you're Goldman's one of the firms that comes out best as a result of surviving the crisis. And you're a big part of the reason why. And I think everybody acknowledges that. But what are your. Some of your reflections from that period of time?

[Michael Batnik]

Well, when you think about. So I was at the Federal Reserve the weekend that there were a handful of us that were at the Federal Reserve, the weekend that Lehman Brothers went out of business. You can reflect on a lot of things, a lot of pride in the way that Goldman Sachs came together. My Coeds came together. We were running the largest portion, the most dynamic portion of Goldman Sachs. It's really where the epicenter of activity was. The entire trading environment across equities, commodities and fixed income. In 2009 to that point in time was the firm's most profitable year coming out of the crisis. But I think in terms of most memorable components, I would say you have to be really connected to the vulnerability of the financial system and truly how close we came as a economic society and as a society to kind of losing control of it and really reflecting back on it. What are the things about systemic risk, connectivity, leverage, that really contributed to that? Because obviously 2008 happens because you have 10, 15, 20 years of built up. And I think when I think about it, the lessons I learned from a risk perspective are many. But there was a lot in there for all of us that have responsibility for financial institutions and politicians and regulators. But a lot of it brought us there. But I think understanding, again, the vulnerability, it goes back to what we were talking about before the show. I had my 1987 moment. You had your moment after you guys started. These moments are incredible points for all of us to pause and say, hey, what brought us here? We have the best capital markets in the world, in the United States. Not perfect. I don't think we should try and make them perfect. Try and make them perfect. We have a zero defect policy. Well, then you don't get growth. But at each one of these inflection points, 87, 94, 98, 2000, 2008, what do we learn from the pandemic? All these things. These are really, really important moments in time for us all to learn as individuals, professionals, and obviously more broadly across the whole system.

[Harvey Schwartz]

Harvey, as you look back at that period of time, was there a moment when you said, it's over, we're going to be okay, or was it like more gradual than that? When did the crisis feel like it ended to you?

[Michael Batnik]

I would say there were two critical points. Well, three, I think TARP was quite significant because it was a recognition from the politicians that they needed to demonstrate some stability to the broader public.

[Josh Brown]

Say two weeks after Lehman. Ish. Yeah, October.

[Michael Batnik]

That was one.

[Josh Brown]

Okay.

[Michael Batnik]

When Morgan Stanley and Goldman Sachs became banks basically overnight on a Sunday. That was less about Goldman to me, but again, it was more about the system saying, okay, we're going to change the system in terms of who's thought of as a banking entity. And then I think more subtle. But in the spring of 09, when the federal Reserve came out with bank stress testing and quantitative easing, which were really very. Two powerful signals partially understood by the market in CCAR and stress testing and all of that. And I think that quantitative easing at the time, wildly misunderstood then really understood. We could spend a whole podcast talking about quantitative easing.

[Josh Brown]

One of the things that happened in the spring of 2009 that put a bottom in the stock market was the repeal of an accounting standard that was forcing banks to continue to mark down their holdings week after week after week. Suspending that gave people the breathing room to say, okay, the marks are gonna slow down and we can actually focus on what we own and what we still wanna own. We don't have to just dump things because it's being marked down. That actually coincided almost to the day with the bottom for the S&P 500.

[Michael Batnik]

You also have to remember, obviously, the environment was very different back then. I think if you had social media now, the instantaneous communication, I think you maybe don't have the time because the things I described happened over many months.

[Harvey Schwartz]

Bottoms happen quicker today.

[Michael Batnik]

I think information transfers so fast, the market participants, regular regulators, have very little time to react. Yeah, you think about Silicon Valley bank.

[Josh Brown]

Well, that open on a Thursday, on Sunday, right.

[Michael Batnik]

So imagine what happens in a Lehman Brothers overnight or over. You don't have weeks. So, you know, there's not the call on a Wednesday that we should get everybody together. The Friday night phone call that we should meet at the Fed on Saturday, there's the call on Wednesday night, and by Thursday morning, we don't have a solution right now. And so the instantaneous nature of markets creates a certain degree of fragility. But of course, markets are much more sound and I think structurally in a better place, but it doesn't mean there's not fragility.

[Harvey Schwartz]

So as we look back on the seeds that were planted in the aftermath of the crisis, or maybe the roots were ripped out, actually forget about seeds being planted. And all of the reforms that came into the banking sector really paved the way and gave rise to the giant alternative asset managers, the Carlisle of the word that exists today, because previous to that, it would have just been the banks doing all this business.

[Michael Batnik]

I think to some degree that's a big contributor. I think one of the fascinating things about our industry, for me, as someone who has the privilege of leading people and mobilizing the organization and working with clients all around the world, I. I think the ecosystem of finance is fantastic because it's constantly reinventing itself. Constantly. I mean, if you just think about the time period we're talking about from 87 to now. It's almost not recognizable. What you all do in your business didn't exist in the way it does today. And you're inventing as you go.

[Josh Brown]

Wealth management was stockbrokering.

[Michael Batnik]

Wealth management was a kid from New Jersey learning about muni bonds for two weeks, picking up the phone, talking to people, trying to build a business.

[Josh Brown]

It was product sales, it was transactional, it was commissions.

[Harvey Schwartz]

So now CFP taking is at an all time high and CFA taking is at an all time low. So the business of wealth management completely flipped.

[Michael Batnik]

Correct. And the ecosystem of finance has evolved for many, many reasons. One of them, of course, and a lot of them are linked to the financial crisis. But part of it is regulation and the way the banking environment has shifted their focus. Part of it is about having a period of zero interest rates. But all these things are linked to the financial crisis because you didn't have quantitative easing before. Globalization and communication is a big part of it because there's just awareness now.

[Josh Brown]

In private equity and credit to Michael's point specifically, you must see when the banks were told, we don't want you risking your balance sheet anymore, we don't want you participating in all of these deals, that's for somebody else to do. There were a lot of private equity firms that looked at that and said, okay, we'll be the someone else, we'll be a counterparty, we'll be in on the deal. We'll take balance sheet risk because we're not banks. We can do it.

[Michael Batnik]

Yeah, I think it's huge. Huge. Lane, it's just. That's 100% right? It literally is. As simple as businesses don't change, Businesses need capital. Capital is what allows businesses to grow. Human capital and financial capital. That's it. Let's just simplify it and talk first principles. You need to have human capital, financial capital, and the financial capital will find its way. Yeah, and this was a natural evolution. Look, if you go back 30 years, 35 years, beginning of private equity, you really, in private markets only had private equity and venture capital. What's happened systematically over 30 years is you've had a filling out of people who can provide that capital. So that's why IPOs have systematically declined since 2000. I think there's like half the IPOs now that there were 20 years ago. It's not because people don't want to go public. It's because there's other alternatives of capital that prevent them from making that choice to go public.

[Josh Brown]

They can wait A long time.

[Michael Batnik]

That's right. And they can keep building their businesses. There are other sources of capital. Wealth is a huge new lane that's opened up that is providing capital. And, and of course, firms like ourselves have been doing this for a very long time at nearly $450 billion of assets. 25 years ago, it was all about private equity. But our biggest business now is credit insurance, our solutions business, our real estate business. Private equity is still incredibly important here. But we provide that capital systematically to anyone who needs it. And it's a very competitive environment. But banks are less relevant in that particular space than they were pre the crisis.

[Josh Brown]

So I want to just circle back quickly to how you get into private equity. So you're at Goldman, you're the head of all these committees, you're part of the federation. Can you talk to what the federation was?

[Michael Batnik]

That sounded so administrative the way you described it. I liked it more when you talked about being dynamic and I was part of the team that led the crisis. Okay, but now in your mind, I'm running a lot of committees.

[Josh Brown]

Well, you're a risk guy. I'm Dan.

[Michael Batnik]

So I moved from somebody's gotta do it. I moved from running trading to being the CFO. And I was a CFO from 2012 to 2017. I was super reluctant to take that responsibility. It was a huge shift in how I had to think my responsibility for the firm. And it was quite a challenge. I loved learning. It was a very hard time because of all the implementation of the regulation.

[Josh Brown]

Had a scrutiny on Goldman Sachs than ever from people that had never even heard of Goldman Sachs a few years prior.

[Michael Batnik]

Correct. It went really mainstream right away. So we dealt with all that. I think when I look back on my career, when you talk to young people today, they'll say, hey, how do you think I should think about the next 10, 20 years of my career? I think it's phenomenal that people have been asked that question. I think it's super healthy. I think young people probably put too much pressure on themselves. If I had asked myself that question, I would have asked it like, geez, how do I get out of debt and what do I do for the next six months? So my perspective on career was so short, Josh. And I just got very, very fortunate that over my 20 plus years at Goldman Sachs and my eight or nine years at Citibank Priority, I just got exposed to a lot of different things. I moved around a lot. I look back after I left Goldman 2018 and I had never held a role for more than five years. So it positioned me with a lot of different experiences, from working in operations to running the balance sheet at Goldman, to being in trading, to working in commodities and derivatives. And when Carlisle called, you know, I'd been really spending my time doing private investing, philanthropy, and passion projects.

[Josh Brown]

So you leave Goldman, you don't 100% know what you want to do next?

[Michael Batnik]

No, I knew 100%. I didn't want to do anything next.

[Josh Brown]

Okay.

[Michael Batnik]

By that I mean I actively made a decision that I thought, this is such a unique point in my life that I could sit back and really take the opportunity to think about what I wanted to do, where I could have the greatest impact. And I was totally comfortable with that. I felt no pressure.

[Josh Brown]

Not a lot of people get that opportunity.

[Michael Batnik]

No, especially not a, hey, look, Josh, let's just level set. I got promoted at Goldman Sachs. At some point in time, I maybe was trading. There was something in the Wall Street Journal subsequent to that. Someone sent me an email that they had ended up linking into two people I went to high school with. And one guy says to the other guy, says, hey, I think Harvey Schwartz was in the Wall Street Journal. He's over at Goldman Sachs. The other guy writes back, that's physically impossible. I'm pretty sure he dropped out of high school in his senior year. So that's. So, again, personal perspective is super important. I have huge gratitude for the fact that I'm even here. And I constantly try and remind myself of that. And so I get this point in my life where I have that freedom and nothing I ever expected. And so when I had that point, I thought, okay. And I still didn't think five, 10 years. When people leave big visible roles now, people will call me up and say, hey, this is what I'm thinking about doing next. And my advice is always, you can do something next or you can take your time. If you're one of the people that's lucky enough to have a luxury to do that for me, I just kind of let it unfold. And I was super fortunate. I have a nice resume. People would call me, they'd say, hey, we want to talk to you about this opportunity or that opportunity. And none of them felt right until Carlisle called.

[Josh Brown]

Okay.

[Michael Batnik]

And then it felt right.

[Josh Brown]

Okay. Why?

[Michael Batnik]

Super simple. Carlisle. I knew the firm. Iconic brand, super important.

[Josh Brown]

Had you interacted with Carlisle at Goldman?

[Michael Batnik]

All of these firms were my client.

[Josh Brown]

Yeah. Yeah. Okay.

[Michael Batnik]

So I know their souls.

[Josh Brown]

Okay. That's important, though.

[Michael Batnik]

Yeah.

[Josh Brown]

You know what you're dealing with.

[Michael Batnik]

Because when you're Committing billions of capital to companies. You understand them.

[Josh Brown]

So who calls you? Like, does Rubenstein call you, or is it like a headhunter?

[Michael Batnik]

Yeah, yeah, yeah. You get like a search firm. Well, first, other people reach out to you, and they say, hey, would you want the phone call? There's like a whole orchestration. You say, yeah, I'm open to the phone call. And then somebody calls you, and then you start meeting. But there were really three fundamental things to simplify. First was Carlon. I knew the brand, I knew their place, and kind of like financial history, right?

[Josh Brown]

Yeah.

[Michael Batnik]

Two, the industry. I did a lot of work on the industry. I knew where the industry was headed, some of the dynamics you're talking about. I knew the lane was important to people. I knew about the growth of wealth. I knew about the trends in insurance. I knew about the importance of the capital and our clients. And then founders time with the founders. I spent a lot of time with the founders.

[Josh Brown]

Three founders, they named it. They met at the Carlyle Hotel, and that's how they named the firm, which a lot of people don't know that. Yeah, there's no Carlyle working.

[Michael Batnik]

There's no car. They couldn't. They didn't know what they're. What they were going to do to make up the name. And then I think it was David that said, why don't we call it Carlisle?

[Josh Brown]

Okay. Famously, the outgoing CEO, there was, let's call it non consensus with the founders and some of the important stakeholders at the firm about some decisions that were being made. And that doesn't go well when the big shareholders are like, we don't agree with your approach. So that ends consensus building becomes an important trait in whoever's going to come in next. And you kind of fit the bill for that. You had a reputation on the street already as somebody who listens to everyone, gets a consensus, and it seemed like they were looking for you. Maybe they didn't know it, but they were looking for somebody like you who could come in and do that. It's not the easiest thing in the world to do.

[Michael Batnik]

I knew the fundamentals of what was important. I knew you needed an alignment with the largest shareholders. They own about 30% of the firm.

[Josh Brown]

Yeah.

[Michael Batnik]

But it went beyond that. So with David, it was interesting because in my first conversation with David, he said, hey, we don't want you to think we're going to micromanage you.

[Josh Brown]

Right.

[Michael Batnik]

And I.

[Josh Brown]

They all say that.

[Michael Batnik]

Yeah. No, no, he meant it. Yeah. David's that kind of guy. And I said, yeah, David, that's not my concern, Okay? I said, I'm fine with micromanagement. I grew up with some of the greatest micromanagers of all time. I've been accused of that myself. So I said, no, David, that's not my concern. My concern is you're doing podcasts, TV shows, books. I knew his institutional history with the firm, his importance to the firm. I said, I need to know you're gonna make your time available. And with Bill, the conversation was really one about intensity. And I don't know what the language restrictions are on the podcast or anything like that.

[Josh Brown]

Let us know what you want. Let it fly.

[Michael Batnik]

Let it fly. So this is really not that flying.

[Josh Brown]

But.

[Michael Batnik]

But I said to Bill in one of our first conversations, I said, hey, Bill, what reservations do you have about me? And he said, we've heard you can be a bit of a hard ass. And I said, too intense.

[Josh Brown]

In other words, you're saying hard ass, whatever that meant.

[Michael Batnik]

So I said, I prefer the word intense, actually. Funny you say that. And he said, I think we need it now. That's not at all the way I've approached this. I've approached it because you can't come in unknown, other than, hey, you're, you're some dude from Goldman Sachs. You have to come in and you have to build rapport with the people internally who are working hard, who have been here for decades.

[Josh Brown]

Right? It has no effect. Although if you walk in and you're hard ass day one, it's like you just got here.

[Michael Batnik]

No. And what do you know?

[Josh Brown]

You. Well, you need people to. You need people to respect that, you know what you're talking about first. And so you've been, you've been it.

[Harvey Schwartz]

For a year and a half. How would you grade yourself so far.

[Josh Brown]

On the hardest scale? How hard?

[Michael Batnik]

I think I've been a very delicate version of myself. I think we've been able to accomplish a lot. When I look back over it, I just met with one of our largest shareholders, which is why I was a few minutes late for you guys. And he was listing out all the things we've done from addressing all the pillars that would make a firm like this successful. So mobilizing teams into business growth, mobilizing the whole effort into growing our wealth franchise, given we have one of the most recognized brands in the world, you know, working on driving and changing the incentive system, which is a very, very complicated thing to do in terms of aligning all of the capital commoners and the investors with our clients. So we've changed the carry Protocols. We've elevated people, new cfo, new heads of teams. I think that the positioning of the firm today is fantastic. I'm super proud of all the work that he's done. I'm really grateful for the founders engagement. David's been all over the world with us, Bill.

[Josh Brown]

You have his attention when you need him. Big client, big deal. David, we need you in the room for this.

[Michael Batnik]

Yeah, yeah, yeah. He's a huge shareholder of the firm and he loves doing it. I mean, the guy's indefatigable. I don't even really understand it. It's embarrassing, you know, like, I'm 60 and he's 75 and like, we'll be somewhere. And first of all, I don't understand how he stops and signs every autograph everywhere he goes. And then like we get to a staircase, I have a bad knee, he runs up the staircase. I think he's doing it just to set an example, which is, you know, but you want.

[Josh Brown]

But the main thing you want from him in a professional sense is you want him to keep being him. Because he's an incredible emblem for the firm. Everywhere he goes, people love to hear from him. And the connections, the contacts, like you have to balance how many meetings do you really want him in versus don't you want him at Davos or whatever?

[Michael Batnik]

So the good news is on the balance question, he'll do it all. So I have to spend a lot of time balancing it.

[Josh Brown]

Okay.

[Michael Batnik]

It's better with David in the room. I have. I love it.

[Josh Brown]

Okay.

[Michael Batnik]

I love it. And he brings.

[Josh Brown]

Michael says that about me very often, so.

[Michael Batnik]

No, no, no, no. I could see he was self reflecting there for a moment. You didn't see his face. You might want to watch it on the show. The. No, I think that, hey, they're fantastic partners to work with. We're wholly focused on mobilizing this enterprise. And it's not just for them about the economics. These are super successful gentlemen. They created this thing. They are the largest shareholders. As I said, they own about 30% of the firm. But you can say it's about legacy. It's what they care about. I mean, they have huge interest. They're some of the most philanthropic people in the world. But their focus in helping me make our firm as great it can be. As great as it can be is I'm really grateful for it. And they're fun to work with.

[Josh Brown]

Yeah.

[Michael Batnik]

And they're smart. Like, I love learning. You can learn, you know, if you're on a plane with David and you Want to know everything about the history of baseball. I don't think you know anything about baseball before the Baltimore Orioles, but he knows everything about baseball now. And so fantastic partners and friends, can.

[Harvey Schwartz]

We talk about the fundraising environment? So $40 billion raised by Carlisle, you can correct me if I'm wrong, over the last 12 months. And this just a little more, but good. Okay, so the source, the sources of capital, historically, private investments have been for large institutional investors. Sovereign wealth funds, endowments, foundations, like large pools of capital. And that story has gradually shifted. It seems like it's reached a fever pitch, particularly this year. If you look at my inbox, the wealth channel, that is where a lot of the efforts are and attention is being paid. So can you talk about the transition from institutional investors to maybe where we're going, where we are today?

[Michael Batnik]

Sure. So of the many significant trends that will drive the evolution of capital formation, let's say for the next 10 or 20 years, this is probably the most significant. So, and a bit of this gets back to this. What is the wealth significant in terms of alternatives, if you want even call them alternatives. They won't be called alternatives. Whatever we come up with name is the right name. It'll just be credit, it'll just be equity. And as a wealth client around the world, you will be selecting between various pockets of equity, various pockets of credit. And this evolution is very early days.

[Harvey Schwartz]

Top of the first.

[Michael Batnik]

But the most significant trend affecting capital formation, I think for the next 10 or 20 years.

[Harvey Schwartz]

So like I said, my inbox was flexed out. And the story that I see, and correct me if I'm wrong, is that the institutional investors are there. Right. If you have 40% of your portfolio in alternatives and private investments, whatever you want to call it, a lot of the juice has been squeezed and there's also, there also has been a lack of, of investment returned back to them over the past couple of years. The environment for that has been very difficult. So now you see, holy cow, there's this $15 trillion pile of money that advisors, manager, whatever the number is, it's large and they're at zero, effectively, whatever it rounds down to zero.

[Michael Batnik]

Yeah.

[Harvey Schwartz]

So the opportunity, the Runway is very clear where this is going. And I think you're right that it is just getting started. Even though it seems like, oh my God, there's a fever pitch. It seems like, like the, the, the tracks are being laid right now.

[Michael Batnik]

Correct. It's like the early days of ETFs. Yeah. And it will be as significant. We could all sit around and Predict on exactly where it heads, how the capital, how the capital formulates, when is it part of retirement plans. But all these things are likely quite inevitable. But the big thing I think that gets lost in these discussions is it very often gets described as a US centric event. It's very much a global event, whether we're partners with someone in Korea or Japan or in the Middle East. And as you said, in some cases it's top of the first. Some cases this is like pre season. As I said, it's very difficult to predict 10, 20 year trends. This is a 10 or 20 year trend that's super powerful.

[Josh Brown]

One of the, one of the things about wealth management in the modern era, I wouldn't call it a dirty little secret, but it's a little secret. People don't actually end up spending their money. They just keep it invested forever. They borrow against it before they'll spend it. And so as a result, there's a lot more room for illiquid investments in wealth management retirement accounts than maybe we had thought there was 15 years ago, 20 years ago. So if you think about the household wealth in this country making record highs, the RIA channel alone is 7 trillion. Let's say the wirehouse channel is closer to 5 or 6 trillion. Just wealth management assets. Most of that money is not going to be spent down within the lifespan of the people who own it. It's inheritance, it's legacy. In that context, a 10% sleeve in illiquid assets, private assets, venture assets, makes a lot more sense to people than it used to. And I think that's a really big part of why the trend is now becoming so apparent to everyone.

[Michael Batnik]

So when I got here, I knew how important wealth was. Carlyle hadn't prioritized it as its highest strategic priority. So we immediately flipped that. Yeah, I know the Carlyle brand, one of the most recognizable in the world. I know the teams. We had a credit solution called ctac, which is the best of Carlyle credit in the marketplace, which is growing very, very quickly. Last year we launched capm, which is a solutions product around Secondaries Co Invest, which has had very, very rapid adoption also. But for myself I thought I should get close to this. So we have teams of people in the building that are actually calling the wirehouses, calling the ras and representing Carlyle. So I said I want to cold call some of these people myself. Which by the way was super informative and kind of fun because when the 25 year old kid picked up the phone and I said, hey, listen, I'm not. I'm not kidding. I am the CEO.

[Josh Brown]

Harvey Schwartz, the CEO.

[Michael Batnik]

It's fantastic because, you know, of course they think I'm punking them.

[Josh Brown]

So who you. Who are you calling at the wirehouse in that situation, for example? That's somebody working on a team of advisors doing portfolio stuff, Right? Okay. And that's the Michael Batnik of that.

[Michael Batnik]

So I would go and I would talk to them. Should have called you. I'd talk to them and I would say, hey, tell me about how you think. I didn't want to know about Carlyle yet. I want to know, how do you think about alternatives with your clients? And then I wanted to know, what are your challenges? Who's most effective with you? I walked into an office in California wearing a sweatshirt and a pair of shorts. I walked up to the assistant. I said it was a Morgan Stanley office. I said, hey, is the manager here? I'd like to talk to the manager. She looked me up and down and said, about what? I said, I'm the CEO of Carlisle. Do you know what Carlisle is? No. She said, hold on a second. He eventually came out and he's like, what are you doing here?

[Josh Brown]

And I said, now, was he holding the golf putter when he came out of his office, or did he put that down?

[Michael Batnik]

No, he's actually a guy from New Jersey and probably golf. But he had a great life story, knew all about JB Hanner. It's amazing how many people know about these firms, by the way, in the industry. But in those conversations, what I really wanted to get to was, was understanding how they have to think about their client. Because a lot of what happens in our industry and a lot of the mistakes in our industry go back to product proliferation first, then go to the client. And I really want to understand, when you talk to your clients, to your point, the clients, the classic 60, 40 portfolio can be in very liquid assets, often should be, but the allocation to a less liquid bucket at the margin, less liquid, makes a ton of sense on any mathematical expression. Having said that, what's right for an individual client is what I was trying to get at. And how could we be most helpful? I learned a ton through that, and it was fun.

[Harvey Schwartz]

So allow me to. If you would look at this through the lens of a little bit of a skeptical eye. So back in the 80s and 90s, when these private markets were being formed and there was very few players and the multiples that these businesses were acquired for were often single digits, you throw on some leverage and you're looking at really fantastic returns. Now, obviously it looks a lot different. It's very competitive. The multiples for some of these companies is not too, too far from where liquid private public markets are. And all of the capital coming in has to push return expectations down a little bit compared to the returns that we've enjoyed over the last or institutional investors have enjoyed over the last three decades. When you hear that, because I'm sure you've heard this a million times, what's your reaction?

[Michael Batnik]

I think absolutes are difficult to wed themselves to, but I think there's threads of truth in that for sure. Okay, so let's talk about why I think you're right. I think markets are ultimately always becoming more efficient. This is in the best interest of all market participants. Okay. Because of all the things we talked about, the speed of communication, excess alpha is hard to sustain for a long period of time in any segment, any industry, because things converge too quickly. So the question is back to the way you described it, Josh. For an advisor working with a client who's accumulated a certain amount of wealth, whether they're thinking of a 10 year horizon, a 20 year horizon, or a 30 year horizon, the real question for them is how do I compound those dollars over a period of time in a way that most suits the client? This will not be right for all clients. Many clients would just say, hey, I need liquidity all the time just because it makes me sleep better at night. And others might say, well, geez, that's a bad portfolio construction. When I thought about filing for bankruptcy when my daughter was 2, I remember thinking, I never want to have debt again. It took me a long time to get out of debt. A lot of people would tell me, if you looked at my portfolio, you'd say, you should have more debt. Harvey, don't make a joke. You would. So when, when you talk to the advisors, it's not about having the single best outperformance in an asset class. It's about having steady performance in a diversified way. I think again, back to the absolute nature of what you said, Michael, in 1998, when long term capital happens, someone I have a huge amount of respect for was walking past me on the trading floor of Goldman Sachs and said, that's it. The hedge fund industry is over. No one's going to make any more money in hedge funds. By the way, it made sense to me, okay? 1999 to 2007 may be the most prolific growth of hedge funds in history of time. And they play a super important role in people's portfolios but it's always competitive. So again this is a case of what role should this play. Flip it back to putting the client at the center of the discussion who should make themselves available to this. How should it fit into a portfolio construction? How do you think about. And that's what advisors are doing. I've had many advisors say to me and I'm skeptical on the asset class, I like to keep my people in high yield bonds versus more private credit. And I've had many say this is so important to my clients that I have to have it as part of the toolkit. And I think that's totally reasonable.

[Harvey Schwartz]

I think a lot of clients, if I could push back against myself, push it back against you. A lot of clients would say you.

[Michael Batnik]

Lost me on the pushing.

[Harvey Schwartz]

I like the illiquidity. Even if I'm.

[Josh Brown]

If I only behavioral benefit to not being able to raid your own.

[Harvey Schwartz]

If I only match public markets but I don't have to see the marks and I can't do anything to shoot myself in the foot. I'll pay for that happily.

[Michael Batnik]

Oh, interesting. Yeah, I haven't thought about it that way. I think the marks and the transparency are really critical that clients understand that and have full transparency into their portfolios. But I do think there's. I'm certain there's a segment of those clients who say listen, by putting something in a longer term asset class that at the margin is less liquid, that's really a robust enhancement of my portfolio and I want part of that.

[Harvey Schwartz]

They're coming to 401s. I mean I'm sure you guys are thinking about that. That's going to be a trillion, multi trillion dollar unlock.

[Michael Batnik]

It's going to happen. All that happened because it should happen. Because why if you're the largest pension fund in the world, the largest sovereign wealth fund in the world, should you have the flexibility across that spectrum? Sovereign wealth funds are doing it on behalf of their countries. Pension funds are doing on behalf of their beneficiaries. Why wouldn't an investor, an individual investor have the same flexibility to have that portfolio construction?

[Josh Brown]

Especially if it's long term money anyway, you're not accessing your 401k for 35 years. In some cases it makes a huge.

[Michael Batnik]

Amount of sense for the client in the 401k portfolio and it actually makes a huge amount of sense for those people who want long term capital that we're providing capital to.

[Josh Brown]

So I'm being told anyway, I'm being told we have time for one more. I just Want to, I want to. I want to spend a second just looking at some of the superlatives of Carlyle today and then just have you react to this.

[Michael Batnik]

I think we should take our time to go through this. I don't think we need to wrap it up.

[Josh Brown]

Okay, you guys, I mean, you guys are on fire. 447 billion, as we mentioned at the top, that's a 17% increase year over year. There's a. There's a metric, fre fee related earnings, a record 1.1 billion over the last 12 months, all time high. That's a 33% gain. FRE margin is 47%. It's an 1100 basis point improvement. You guys have raised. We have 43 billion. Maybe that's not the exact number. 85 billion in dry powder, which is up 20% year over year. I have some investment ideas for you. Performance revenue up 30%. That's a reflection of how well you're doing for your LPs, for your investors.

[Michael Batnik]

Team's doing a great job.

[Josh Brown]

And then just generally speaking, look, it's a bull market for your asset class. But the resurgence of Carlyle, even within that bull market is probably the most interesting story. You look at the publicly traded comps, everybody knows Blackstone at record highs, has a bigger market cap today than BlackRock, which I think would be surprising to a lot of people. KKR, it's the S&P 500. There's like a lot of great headlines about the space. I think you guys coming along and taking the storied brand and bringing it to wealth and globalizing it, et cetera. It's pretty exciting.

[Michael Batnik]

Yeah. Well, I appreciate that'll be a lot.

[Josh Brown]

Of fun for you to be in the.

[Michael Batnik]

No, no, no. It's fantastic. The team's amazing being part of this. You know, the whole team coming together has been really fantastic and you know, repositioning the firm for growth.

[Josh Brown]

Yeah.

[Michael Batnik]

What you're starting to see, of course, is, you know, the numbers follow the performance and what the team is doing. I'm super proud of what they're doing, and I think, you know, it should continue to be reflected in the stock price because as this math translates into the marketplace. But it's a real privilege for me to be part of it. And it's certainly been fun to be on the show with you guys. You're the best, Harvey.

[Josh Brown]

This has been one of the highlights for me personally of the year. I know Michael would agree with that. And I think our audience, if they could be here today, they would all say they appreciate hearing from you. Thank you so much for doing this.

[Michael Batnik]

Love to come back.

[Josh Brown]

Absolutely. What are you doing tomorrow?

[Michael Batnik]

Thanks very much. Tomorrow, Alan.

[Josh Brown]

Is he good tomorrow or.

[Michael Batnik]

Yeah.

[Josh Brown]

Thank you. Thank you very much.

[Michael Batnik]

Thanks. Josh. Michael, great to see you. Thank you.

[Josh Brown]

Sa.