Opinion
Lasry: Selling a minority stake instead of an IPO was a mistake
“I actually think we made a mistake. Morgan Stanley's been a great partner. That wasn't the mistake. I think at the time, the decision was, do you sell a stake to a financial institution such as Morgan Stanley, or do you go public?”
Prediction Not checkable as stated
Lasry: Federal Reserve focus will shift from inflation to recession
“I will guarantee you the focus of the Fed is not inflation, but is the recession.”
Disclosure
Lasry: Avenue Capital is no longer comfortable investing in China
“Five years ago, we were comfortable investing in China. Today, we're not.”
Disclosure
Lasry: Avenue Capital returned half its AUM to investors in 2011
“We returned half the money, and we made this big decision to get back half the money because we thought there was just less and less distress, right?”
Insight
Lasry: Public asset management firms gained massive advantage through liquid stock
“And that the firms that went public had a massive advantage, which was that they had Currency to buy others and to tie up employees by giving them stock. And also that currency was liquid. Whereas what we were doing was giving people partnership interests in a…”
Disclosure
Lasry: We paid 100 times cash flow to buy the Milwaukee Bucks
“I bought the team, we paid a hundred times, and on the investment world, that seems high, because you would never do that”
Insight
Lasry: Sports franchise valuations require media rights to double or triple every decade
“And for them to keep going, you needed to keep doubling and tripling your media rights every seven, 10 years. So I just thought it was the right time, and it's bittersweet.”
Prediction Held up
Lasry: Private equity will not return 15-20% over the next three years
“Today, you can make loans at 12 to 15%, because nobody else is making them, and you're senior and you're secured, but I don't think private equity over the next three years is gonna make you 15, 20%, and if it does, that's great,”
Insight
Marc Lasry targets 500 bps spread for Asia credit, 200-300 bps for Europe
“For investing in Asia. I always think it should be 500 basis points more. Europe should be two to 300 basis points more. Right? US is just more liquid.”
Opinion
Marc Lasry: The UK legal system is stronger for creditors than the US
“I would say to you, that's true, unless you're investing in the U.K. Because the U.K., the legal system there, is actually stronger than it is in the U.S.”
Assertion Not checkable as stated
Lasry: Mega-firms like Ares and Oaktree now rely on bank leverage
“What you're finding is the larger firms, whether it's Aries, Oaktree, will go out and end up doing these bilateral deals, and they'll end up using the leverage from a bank To generate the return. So I think, I would tell you, 10 years ago, people didn't really…”
Disclosure
Lasry: Avenue caps fund size at $1B to avoid relying on leverage
“Our niche is we try not to raise funds that are larger than a billion dollars. Because the larger we get, the more we're going to compete and need leverage to generate returns. The smaller you are, the more you can generate unlevered returns.”
Prediction Held up
Lasry: Bank lending pullback will last 1 to 3 years
“However, the fact that they're not lending and banks aren't lending, that's going to be a year or two years, or maybe even three years.”
Disclosure
Lasry: Russia seized four planes from Avenue Capital following Ukraine war sanctions
“We have an aviation fund that invests, and we own four planes. Those planes, at the time of the Ukraine war, were taking passengers from Turkey to Moscow. When sanctions came down, Moscow grounded those planes, and we found, all of a sudden, Four of our assets…”
Insight
Lasry: Investors should back the Asian region rather than direct China exposure
“You actually want to be investing in Asia for one simple reason. If the driving force in Asia is China, And that driving force is growing by five percent a year. Do you think that's beneficial for the region? Yes. But people look at your question, geopolitical…”
Insight
Lasry: Being right is irrelevant without the time to be right
“It's irrelevant being right. You need to have the time to be right.”
Assertion Supported
Lasry: In 1988, $150M was the world's largest distressed fund
“In 1988, we were the largest distress fund in the world with one hundred and fifty million dollars.”
Disclosure
Lasry: We shut down a brokerage generating 80% of our income
“Sonia came up with the idea that we needed to close the brokerage firm and just focus on the asset management business. And I don't think I was fully bought in on that. It was actually generating, I think for Sonia and I, probably 80% of our income. And she wa…”
Insight
Lasry: Top teams win by minimizing bad contract mistakes
“Within a year, you find out the contract you sign is either a really good contract or a really bad contract, and you see that over and over again, and the teams that do well are the ones who minimize the mistakes of signing bad contracts.”
Opinion
Lasry: European debt investments are overpaying for risk
“I think opportunities in Europe today are pretty large, just simply because you're getting overpaid for the risk.”
Assertion Not checkable as stated
Lasry: Sports franchise lending offers ~20% loan-to-value ratios
“I think you can lend at around a 20% loan to value, which you can't find anywhere.”
Prediction Not checkable as stated
Lasry: Women's sports will grow exponentially
“And what I want to do is get involved in women's sports. I think that is going to grow exponentially.”
Insight
Lasry: Finance professionals continuously raise their retirement number instead of quitting
“We all say when we make a certain amount of money, we're going to stop. Everybody's got a number in their mind, and then you get to that number, and then you raise your number.”
Assertion Not publicly verifiable
Lasry: R.D. Smith bought Lionel claims at 20 cents before 80-cent payout
“They were paying 20 cents for claims, and under the plan of reorganization, we were paying them 60 cents for cash and 20 cents in stock.”
