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 19 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
Rieder: Lehman Brothers would have survived if Bart McDade became president earlier
“I'd say this to this study and people who were at Lehman Brothers would tell you this, if he became president two years earlier, Lehman would still be around.”
Rieder: The Federal Reserve is making a mistake by delaying its taper
“I'm pretty wigged out, but I think the Fed's waiting too long, and I think they're making a mistake.”
Rieder: US inflation will normalize to around 2% once reopening fades
“But if you normalize airfare, lodging, growth of used cars, et cetera, you're going to run at two-ish percent, maybe a little higher. But I think they're right on the transitory thing generally.”
Rieder projects that the US economy will achieve 8% GDP in 2021
“I think the economy is going to grow. I mean, I think we're going to have an eight percent GDP this year.”
Rieder: Factor investing fails without fundamental and qualitative analysis
“Like, I think factor investing is a great way to invest. However, there are environmental conditions that can really shift, and if you're not doing the qualitative analysis, the fundamental analysis, then I don't think it'll work.”
Rieder: Stan Druckenmiller and David Tepper are the best investors I've seen
“And you have to say the two best investors I've ever seen, Stan Druckenmiller and David Tepper, both are friends of mine. They have an ability in a much more efficient way than I do of separating out. That's not important. That's not important. This is importa…”
Rieder: Real alpha in fixed income will come from bespoke structured originations
“I think where a lot of the real alpha is going to be going forward. It's bespoke investments where you functionally create the investment, whether it's in the commercial real estate or resi or a European asset finance. The term loan to an aircraft producer. Th…”
Rieder: Leaders should let team members execute sub-optimal ideas with limited downside
“One of the things you learn over the years, it's like somebody on your team could have an idea and investment or what have you. And you actually think it's not the right idea. And then at times, if it's, obviously it's not going to hurt significantly, you let …”
Rieder: In trading, being right does not matter if the market moves against you
“One thing you learn in in trading is it's not about being right. It's about making money. You could be right. And if everybody thinks you're wrong or everybody thinks you own them all, you're going to lose.”
Rieder: Fixed income strategy requires high trade volume and avoiding concentrated duration bets
“My philosophy and fixed income Is diversify, do a lot of trades, get regime right, get the asset allocation right, and then do a lot of relative value trades. Don't make a huge bet on duration. Don't make a huge bet that's going to overwhelm the whole portfoli…”
Rieder: BlackRock lets European credit traders run equity positions when spreads tighten
“If we have somebody in Europe that's trading credit, I'll let them run a piece of equity in their position because there are times where like credit spreads are too tight. And I don't want them to be sitting there doing nothing.”
Rieder: BlackRock's sheer scale provides a major information advantage over macro funds
“The information flow within the four walls of this organization around how many walls there are in this organization is unbelievable. And I always think like, how can they make masks? Do you think Japan will be a buyer or seller of bonds and manage a lot of mo…”
Rieder: BlackRock prefers owning junior tranches in CLOs to control structures
“Oftentimes today, for example, the CLO market, We like to own the lower parts of the debt stock because we'd like to own the structure.”
Rieder: BlackRock is paring back US high yield for IG and securitized debt
“We think a lot of the U S high yield markets got rich. So we've been pairing that back on more up into up an IG, running up more of a barbell with some securitized assets, learning a little bit of EM and then just letting the teams go.”
Rieder: Overheating Wage Growth and Input Costs Promotes Automation Over Hiring
“In fact, I think it's going the other way because when you overheat input costs or you overheat wage acceleration too fast, it promotes technology and fewer jobs longer term. And companies always look at the return on invested capital versus their weighted ave…”
Rieder: BlackRock's global fixed income platform manages $2.6 trillion in assets
“I'm the CIO of global fixed income. So I guess our total size of that is 2.6 trillion. We've got obviously huge I shares business, a big passive business.”
Rieder: Subprime auto ABS spreads dropped from 800 bps to 15 bps
“Triple A subprime auto was at 800 spread a year ago. It's now at 15. Single A subprime auto, I think, is at 45.”
Rieder: US savings are $2.2T higher than pre-pandemic baseline
“I know this is a stat that the savings in this country is 2.2 trillion dollars higher than if we didn't have a pandemic.”
Rieder left Lehman in May 2008 before merging his fund into BlackRock
“Then I went to Lehman, went out of Lehman to run a hedge fund, and unfortunately I did a Mayo eight, wasn't exactly perfect timing. Good timing to leave Lehman, but it wasn't a perfect time to set up a credit hedge fund. And then we had a tough oh eight. And t…”