Prediction Not checkable as stated
Eichhorn: If rates stay high, private credit will see more pain
“If we continue and rates stay high here, I don't see how there's not more pain in private credit.”
Assertion Supported
Eichhorn: PE-backed insurers use much more private credit and offshore reinsurance
“Clearly there is a very, very different model for the private equity backed insurers. A lot of insurers are using private credit to be sure, but the private equity backed are using it much more and other products, whether it be CLOs and using a lot of offshore…”
Assertion Supported
Eichhorn: PE-backed insurers trade at much higher funding note spreads
“Many insurers issue what are called funding agreement-backed notes. Those are policy-level notes. They're parapesu with policyholders, so they're a really great market measure of what's the risk of an insurer, and you just see it in that data. The private equi…”
Insight
Eichhorn: Macro interest rate calls offer poorly compensated risk
“I don't need to go on CNBC and say, here's what my rate call is, because we think those are really, really poorly compensated risks, even if you get it right more than you get it wrong.”
Disclosure
Eichhorn: NISA Regularly Talks Institutional Clients Out of Wall Street Derivative Pitches
“There's a lot of things pitched often by the dealer side, Wall Street side, that we don't really believe in, and we will go in and talk to clients, and we've frequently done this. We put some Surgeon General's warnings on things. We're like, here's where that …”
Opinion
Eichhorn: Investors shouldn't pay 2-and-20 for known market inefficiencies in hedge funds
“I think there's increasingly a view that some component of hedge fund returns are known inefficiencies, and, you know, could be inefficiencies in the commodity market, et cetera, that are not extractable, and you shouldn't pay two in 20, and maybe not even one…”
Opinion
Eichhorn: Unmarked private assets are typically riskier than public equivalents
“Private assets don't get marked at all, and that doesn't make them less risky. In fact, they're probably more risky, typically, than a public market equivalent.”
Insight
Eichhorn: Measured Growth and Ownership Protect Quality Over Rapid Franchising
“Something got ingrained in me in that employee ownership's a big deal on quality, and he was asked millions of times to franchise, and he never did. He thought that would lead to mediocrity, and so I think I also learned things about, you measure your growth.”
Assertion Supported
Eichhorn: Dodd-Frank permanently shrank broker-dealer bond inventories
“Ever since, 2008, as Dodd-Frank came in, being enacted slowly over time, the dealer's balance sheets have just shrunk to be just a shell of what they once were. So They don't inventory bonds or many bonds anymore.”
Assertion Not checkable as stated
Eichhorn: Mandating Two-Way ISDA Collateralization Kept NISA Safe in 2008
“So fortunately, with a lot of work, we got those ISTAs set up at that moment to be collateralized fully in each direction. So we'd post, they would post, and that kept us out of a lot of trouble in oh eight, oh nine, and still a scary time in a lot of ways, bu…”
Insight
Eichhorn: Exclude top executives from innovation teams to avoid deference
“One key element is not putting the most senior people in the micro battle, because even though I think we have intellectually humble senior folks can't help, but there's going to be deference to that view.”
Assertion Not publicly verifiable
Eichhorn: Over Half of NISA's Physical Assets Are US Treasuries
“Our physical assets, over half of them are Boring old U.S. Treasuries, but they work. They get the job done on hedging, and they're great collateral.”
Assertion Supported
Eichhorn: NISA Manages Over $200B in Physical Assets, Remainder in Overlays
“So that's our physical side of the house, which is well north of two hundred billion now. The remaining AUM are in derivative overlay strategies, and those are quite heterogeneous.”
Assertion Supported
Eichhorn: NISA manages over $400B across just 200 institutional clients
“If we have a little over four hundred billion in assets, we have just over 200 clients.”
Assertion Not checkable as stated
Eichhorn: NISA's completion engagements have grown 25% annually for 5+ years
“So that's an area that's grown, depending on how you measure it, 25% a year for the last five plus years.”
Disclosure
Eichhorn: NISA clients systematically increased fixed income and derivative hedges
“In the last year and a half, Clients have systematically increased either their allocation of fixed income, or they've increased their hedge by adding more derivatives to the portfolio.”
Assertion Supported
Eichhorn: US corporate pensions are over 100% funded on average
“Corporates have gotten wildly well-funded. They're on average over a hundred percent now. PBGC is More than fully funded.”
Disclosure
NISA is launching its first systematic high-yield fixed income strategy
“We recently actually were just in the midst of launching, of all things for a fixed income manager, a high yield product, which we've never had, and super excited about it. It's more of a systematic strategy than a deep fundamental credit.”
Opinion
Eichhorn: Asset management generational handoffs usually destroy founder-successor relationships
“I think when things go from Gen One to Gen Two in our industry, people don't even speak to each other, much less we have dinner.”
