The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
why aren't all 4,765 resolved? a statement only gets an assessment when the public record can support or contradict it. opinions and what-ifs never can, and 0 checkable ones are still open, waiting for their date. predictions held up or didn't; assertions are supported or contradicted. on every card: ▮▮▮▮▮ certainty · ▮▮▮▮▮ debate potential. speakers are clickable
Sargent: Farm team manager seeding programs do not work in private markets
“I don't think farm team works on the private side only because if you're really undersized in fund one and fund two, a manager becomes proven there isn't going to be capacity for you in fund three.”
Sargent: Managers unable to cite an investing moral dilemma raise red flags
“And I often do ask managers before we partner with them, tell me about a time where you had a moral dilemma in investing and how did you handle it? And I don't expect everyone's moral compass to point in the same direction, but if the manager cannot think of a…”
Placing illiquid private assets in daily liquidity mutual funds is unsustainable
“That, that model of taking illiquid securities and putting them in daily liquidity vehicles maybe was not the best model for the longer term because it's just uncertain.”
95% of late-stage growth outcomes hinge on idiosyncratic execution, not macro
“When I look at all of the mistakes that we've made in the last eight, nine years, and all the successes that we've had in that same period of time, 95% of the time, if not more, it's idiosyncratic, is did we get the fundamentals right on the companies that we …”
Lenders Cannot Effectively Price Bad Credit Due to Asymmetric Downside Risk
“You can't price bad credit. You can try, but you probably won't be right. The thing that's tricky about credit is has a totally asymmetric risk profile. You get paid fees and you get paid a coupon and hopefully you get paid back. If you're wrong, you lose all …”
Sustained 12% Senior Debt Rates Would Cause an Economic Depression
“You can't finance the US economy with senior debt at 12%. You'll create a depression.”
Relying on 40% Loan-to-Value Metrics for Credit Safety Is Dangerous
“I think there's too much comfort gained by the, oh, we're only in at 40% LTV. And you're learning that right now in every asset class. Things, even in private markets, can revalue very quickly. So you have to have a lot of conviction around where you are in a …”
Klarman: Non-index stocks offer superior long-term value over index members
“Stocks kicked out of an index, in the short run, it underperforms. There's a lot of people that have to sell it, nobody that has to buy it. But I would argue that over a longer period of time, it's those stocks that don't make it into the index that are actual…”
Klarman: Without catalysts, being early and being wrong look identical
“The hardest thing about value investing without catalysts is you can own something that's out of favor for an incredibly long time and over five or 10 or longer year period. Looking, being early and being wrong look exactly the same, and you can start to get c…”
Klarman: Illiquidity itself does not generate excess investment returns
“There's been, I think, a great misunderstanding in recent years Among some people who run money, that illiquidity itself delivers degree of return. That if you take the illiquidity, you automatically get the return. I don't think anything could be weirder than…”
Daniel: Multi-manager volatility targeting dictates modern daily market flows
“The lower the volatility in the world, the more capital they're deploying. And that was a very interesting concept for us. A concept to that was an eye opening experience. And more importantly, probably now it is dictating a lot of the flows and the performanc…”
Daniel: High leverage forces multi-manager hedge funds into short-term momentum trading
“If you work at these shops, it took me a while to figure out, but almost all of them
Are 90, 95% of the time long short-term momentum, which is in English is long something that is working right now.
And when you think why they have to do it, if you're so leve…”
Sacca: Founders who do not help clean dishes lack startup empathy
“If they couldn't empathize with the host, how can I be helpful? Then it just shows somebody who is not equipped to build a startup because a startup is constantly about empathizing with your customer and your user, and then showing how can I make it easier for…”
Sacca: Removing Carbon From Any Process Inherently Makes It Cheaper
“So anytime we remove carbon from a process, it just gets cheaper. Carbon has an inherent value. It's necessary for a lot of the stuff we do, And it has a monetary value. And so any way we could take it out of building a product or running a service, we just ha…”
Investment managers hit their career sweet spot in their first five years
“We have a very strong belief, backed up by quite a lot of data, that there is a sweet spot in the careers of great investment managers that really occurs in those first five or so years when somebody who's proven themselves at a larger firm leaves, start somet…”
Fagan: Multi-strategy hedge fund risk cutting drives cross-market contagion
“Nothing's really occurring in a vacuum anymore, largely because of the influence of multi-strategy funds and platforms that will trade all of these strategies at the same time. And have aggressive risk cutting guidelines for when they're losing money in any on…”
Blitz: Multi-Strat Risk Systems Create Exponentially Understated Crowded Risk
“I think some have what optically seem like good risk systems that are very backward looking. You have lots of people using the same risk systems. I think it can lull you into a false sense of security that can make you feel like, hey, I can lever up my portfol…”
Fagan: Allocators who feel comfortable with leverage are doing something wrong
“I honestly don't think you're ever comfortable with that. If you're comfortable with leverage, you are doing something wrong.”
Blitz: Passive and pod shop flows create alpha vacuum for stock pickers
“So what's happened the last 1012 years, you've had a lot more money flow into passive investments versus active investments, and you've had a lot of money flow into the platforms, which Not to paint a broad brush, but generally are shorter term traders. And so…”
Blitz: 100% long by 60% short is optimal long/short equity exposure
“So there's kind of a sweet spot in the middle where there's enough exposure and let's call this a hundred long by 60 short as sort of a sweet spot, if you will. Depends a little on the volatility and dispersion of the area. You can probably go a little lower t…”
Zandiyeh: Tech startups face lower expropriation risk than frontier industrial assets
“The difference is that you have a tangible asset that it relatively is operationally simple to run. There's a positive correlation between the success of it and the willingness of the government to ultimately want to take it off you at some point in time, beca…”
Craib: Uncorrelated mediocre models help Numerai more than correlated good models
“If you make a mediocre model that's very uncorrelated, you can do particularly well. Because of its lack of correlation is actually helping Numeri more than a good model that's correlated with the one we already have.”
Monk: Innovating and deviating from peers gets pension allocators fired
“I often joke that the only way you get fired from a pension fund is you innovate, which means you've deviated from a peer group, and somebody says, huh, what are you up to? And then all of a sudden, you've got to justify it.”
Giannini: Private Equity Has Outgrown LP Capacity to Fund GP Ambitions
“The industry has simply outgrown both in terms of its size and its desire for more size. Has outgrown the limited partner capacity to fund it for a period of time. There's just not enough money in the world to give GPs everything that they want, whether it's a…”
Giannini: Most institutions lack the resources to pick direct co-investments
“The reality is for most institutions, not all, but for most institutions, they're simply not resourced enough to do co-investments. And so our view is they either ought to do every co-investment that walks in the door and just make sure you do enough of them, …”
Giannini: PE Outperforms Public Markets Due to Superior Corporate Governance
“Private equity outperforms because it's a better form of governance, period. I mean, I get the leverage and I get all that other crap, but it is a better form of governance. You'd much rather be private than public in terms of your ability to do things.”
Toomey: Private Capital Markets Are Undergoing a Historic Structural Transformation
“We are witnessing the creation of a private capital markets, kind of not dissimilar to what we saw a 150 years ago underneath the old oak tree or whatever tree it was down at the corner of wall and broad.”
Joy: Investment committees resist firing managers with stellar trailing returns
“I think, and history's shown me, that it's very hard to get an investment committee to agree to firing a manager when their performance is stellar, or to not re-up With a manager when they've got absolutely shoot the lights out numbers, but in our view, they'v…”
Joy: Divestment versus engagement is a false dichotomy in responsible investing
“So, I mean, I guess the first thing on divestment versus engagement, people often are in one camp or the other, and I would say it's a false dichotomy. You need both, because I think engagement without the ultimate threat of divestment is a very blunt instrume…”
Orum: 80% of climate decarbonization falls between divestment and venture solutions
“So divestment and climate solutions, in my view, deal with the two pillars, but about 80% are going to fall somewhere in between. How do you decarbonize a heavy industry? How do you decarbonize buildings and the built environment? Obviously transportation. And…”
Orum: Standard 2-and-20 fees deter scaling capital in renewable infrastructure
“The typical fee load applied to that activity is a real deterrent to crowding in large pools of capital. They aren't assets that have the optionality that can really absorb a two in 20 or a one in 20 fee load.”
Ivascyn: Investors should not expect rapid government bailouts in next crisis
“I think with inflation where it is, with debt levels where they are, with political gridlock where it is currently, It's very dangerous to think that a rescue will come relatively quickly the next time we have a crisis type environment.”
Thomas: Business equity ownership is the single biggest driver to solve wealth inequality
“Let's be clear. The single biggest way that you change the differential of the wealth equation in this country or any developed nation is ownership, equity, ownership in scalable, saleable businesses.”
Having a long duration capital advantage does not play in public markets
“If duration's our advantage, it doesn't really play in public markets.”
Marshall: Believing deals work at any valuation is investors' worst lesson
“This whole concept of the math works for any deal at any valuation because the cost of capital is near zero. I think that is probably the most pernicious thing that was learned by a generation of investors.”
Marshall: Private market inflows completely obliterated the illiquidity premium
“The fact that illiquidity premium had been completely obliterated as more and more money poured into private markets.”
Marshall: Halting fund commitments due to NAV limits is a major mistake
“Because I think not being able to commit because you are already over your NAV is actually a really big mistake, because some of the best funds are actually invested during down years, and so you don't want to miss those years.”
Majewski: In secondary CLO markets, there are no bad bonds, just bad prices
“When you're buying used with limited exception, there's no bad bonds, just bad prices now.
And if someone's a little less good at managing a CLO, we'll just back up our bid five points and maybe that offsets it.”
Majewski: Higher default and lower reinvestment price scenarios produce best CLO returns
“Oddly, the higher default, lower reinvestment price scenarios are typically the best, but that goes back to my data about 2006 and seven being the best vintages.”
Top Silicon Valley VCs Reject Corporate Pensions Due To Finite Fund Lifespans
“We have some growth in buyout mid-cap, and we just never went deep into venture, you know, seed or A round, partially because we just, you know, we're not interesting money to Sequoia and to Sand Hill Row, because Sand Hill Row says, you're not going to be her…”
Rees: Management fees generate immense profits, defying the lights-on myth
“Well, it's not something we like to shout from the rooftops, and I guess here I am shouting it from the rooftops, but these businesses can be extremely profitable. I think the old adage that the management fees keep the lights on, I think that's a good motto. …”
Rees: Traditional LP fund portfolios rarely outperform GP stakes portfolios
“It's hard to model a portfolio of LP interests, investing in funds, that will outperform a portfolio of investing in stakes.”
Ballis: Kirkland scaled private equity by hiring lateral partners over slow internal promotion
“Some of the great law firms in the space stuck to a more traditional model, and what I mean by that is you recruit people from law school, you train them up, and they decide to stay, and their skill sets fit, and they, 1015 years later, are partnered. But we s…”
Gave: Energy and emerging market bonds are the new anti-fragile portfolio assets
“The new two anti-fragile assets are one energy and the other is emerging market bonds.”
Duke: Tackle critical bottlenecks before easy tasks to avoid false progress
“When you're approaching a problem, you want to think about what are the bottlenecks? What's the really hard thing that needs to happen in order for me to be able to unlock this problem? And that's the thing that you're supposed to go after first. You're not su…”
Duke: Asking 'would you buy it today' does not improve decision-making
“One of the things that doesn't help, and I think this is very, very important for financial professionals to hear, is one of the things that does not help is saying, just treat the decision like it's fresh.”