Speaker 1:
From the library of the New York Stock Exchange at the corner of Wall and Broad streets in New York City, you're Inside the ICE House, our podcast from Intercontinental Exchange on markets, leadership, and vision in global business. The dream drivers that have made the NYSE an indispensable institution of global growth for over or 225 years. Each week, we feature stories of those who hatch plans, create jobs, and harness the engine of capitalism. Right here, right now, at the NYSE and at ICE's exchanges and clearing houses around the world. And now welcome. Inside the ICE House. Here's your host, Josh King of Intercontinental Exchange.
Josh King:
There's nothing like the months of March and April for overlapping live televised sports. March Madness is wrapping up. The Masters in Augusta captivates our attention in early April, just as opening day pitches begin a lockout shortened baseball season. The NBA playoffs begin on April 16th and even the NFL Draft closes out the month in Las Vegas, brought to our living rooms on ABC and ESPN courtesy of the Walt Disney Company. That's NYSE ticker symbol, DIS.
Josh King:
I never had a sports day quite like April 2nd, 1994. Working in the White House. We began on the south lawn with President Clinton taping an intro to the final four for the CBS broadcast. Then we heloed out to Andrew's Air Force base, catching Air Force One to Cleveland for the grand opening of Jacob's Field, in a game between the Indians and the Seattle Mariners. Stayed there for a few innings, then flew on to Charlotte for the final four match-up between Florida and Duke, and also between Arizona and Bill Clinton's own Arkansas Razorbacks, who went on to beat Duke 76 to 72 in the final. In that spring of '94 in the NBA, the lowly Milwaukee Bucks finished its season 20 and 62 under Coach Mike Dunleavy in the old Bradley Center with point guard Eric Murdock leading the team.
Josh King:
What a difference 26 years make. Last year, the Bucks, in a season shortened 72 games due to COVID, started in front of nearly empty stands in the new Fiserv Forum, named for the company run by my old boss, Frank Bisignano, finished the regular season 46 and 26. And then on the back of superstars, Giannis Antetokounmpo and Chris Middleton and Jrue Holiday, stormed to the playoffs over Miami, Brooklyn, Atlanta, taking home the franchise's second NBA Championship over the Phoenix Suns. It rekindled memories of the Bucks 1971 March when Oscar Robertson and Lew Alcindor led the team to its first championship over Wes Unsell and Earl Monroe for the then Baltimore Bullets.
Josh King:
Right before the sky-hooking Buck star took the name Kareem Abdul-Jabbar. We had the honor of welcoming the world champion Bucks to the podium of the New York Stock Exchange to ring the opening bell on the day that the team brought their 47 and 28 record this season to Brooklyn to face the Nets and begin their March, if all goes well, to another date with destiny. In a moment, we'll talk to Marc Lasry, co-owner of the Milwaukee Bucks and also co-founder and CEO of Avenue Capital, on his work and career on Wall Street, his takeover of the team in 2014, the league's perseverance through the pandemic, and returning a title to Milwaukee. That's all coming up right after this.
Speaker 3:
Connecting the opportunity is just part of the hustle.
Speaker 4:
Opportunity is using data to create a competitive advantage.
Speaker 5:
It's raising capital to help companies change the world.
Speaker 6:
It's making complicated financial concepts seem simple.
Speaker 7:
Opportunity is making the dream of home ownership a reality.
Speaker 8:
Writing new rules and redefining the game.
Speaker 9:
And driving the world forward to a greener energy future.
Speaker 10:
Opportunity is setting a goal.
Speaker 11:
And charting a course to get there.
Speaker 3:
Sometimes the only thing standing between you and opportunity is someone who can make the connection.
Speaker 12:
At ICE, we connect people to opportunity.
Josh King:
As if he hadn't already done with his career by 2014, clerking for Judge Edward Ryan, running the bankruptcy department accounting company, then founding Amrock Investments and Avenue Capital group with his sister, Marc Lasry looked at another distressed asset, the Milwaukee Bucks, and scooped it up for the tidy sum of 550 million from former US Senator Herb Cole. It's been quite a journey for Mr. Lasry from his birth in Marrakesh, Morocco to his perch earlier today behind the bell of the New York Stock Exchange. Let's get into that journey a little bit before the tip off today at the Barclays Center in Brooklyn. Welcome, Marc, Inside the ICE House.
Marc Lasry:
Oh, thank you. It's a real pleasure.
Josh King:
Now I know ringing the bell at NYSC pales in comparison to lifting the Larry O'Brien trophy at the Fiserv Forum last July. But what was the experience like for you and your team?
Marc Lasry:
It was great, actually. I think everybody was really excited. It's not that often that they get to come down to Wall Street to be in the stock exchange. I think for all of the players who were there, they wanted to learn more or about finance. They want to see where it's happening, because they're all focused on investing. So I think for them, it was a really unique experience. The big argument today was who was going to ring that bell? It went to George because he was the oldest person that was there. So it was actually great.
Josh King:
You said on the podium that you wanted my colleague, Chris Taylor, to give everybody a little of a sense of history. As you were walking out, did they find that they were truly walking in a hallowed place?
Marc Lasry:
They couldn't believe how big it was. When we walked out, I showed him what Chris had talked about. The statue of George Washington, where he was inaugurated as the first president. That that was the capital at the time, which was a lot of things that I think a number of the players did not know. It was a cool day for them. They got to learn quite a bit.
Josh King:
Cool day today. Cool night the other night in Philadelphia, making a statement with a 118 to 116 win over the 76ers with Giannis nabbing 40 points, 14 rebounds, six assists. I think it was the seventh straight road game that he scored 30 points plus. Is the team where Coach Budenholzer wants them to be with seven games left in the season?
Marc Lasry:
We're exactly where we want be. I mean, I think everybody's healthy. We're sort of peaking at the right time. But I would tell you the most important thing is we're healthy. I mean, that we've got Brooke back, that we're able to play as a team. I think you saw it. The defense that we have, the fact that Brooke made his shot. Just how we're coming back together, because Brooke's only been with us, I think, now for the last five or six games. So I think everybody's sort of feeling it and is looking forward to getting to the playoffs.
Josh King:
What do you need to bring that third Larry O'Brien trophy home to Milwaukee?
Marc Lasry:
We need to get lucky. I mean, you really do. East is tough. I think we're the best team or one of the best teams. But one of the things you see is the ball's got to bounce your way. I think that's number one. Number two, you've got to stay healthy. You've got to avoid injuries. It's just hard. I mean, it's a grind. It's two months where you're playing quite a bit of games. You're playing against topnotch competition. You've got to be lucky and you've got to be good. And I think that you've also just got to stay healthy.
Josh King:
I mentioned Abdul-Jabbar in the introduction, the young man out of Power Memorial in Manhattan who first brought basketball glory to Milwaukee. Giannis Antetokounmpo exploits on the road haven't been equaled since Will Chamberlain did it in 1961. Kid raised in Athens to Nigerian immigrants. What does he mean to Milwaukee and also to the world?
Marc Lasry:
He's everything to Milwaukee. The fact that he stayed. He got drafted by the Bucks. He's made Milwaukee his home. He's got two kids in Milwaukee. He loves Milwaukee. But he's a global sports star. The team was in Athens last summer and he's a national hero there. And you see that. Our team was picked to play in Abu Dhabi against the Hawks. So part of that is because of Giannis' appeal. And I think Giannis' appeal is everywhere. We're just lucky that we have him.
Josh King:
You didn't have a hand in drafting him in 2013, but you watched him develop, signed him to that 228 million contract extension a little over a year ago that's going to keep him there for five years. Marc, you always have had an eye for distressed assets, but there's nothing that's distressed about him. How did you see the economics and the return on an investment of doing a deal like that?
Marc Lasry:
Look. In the NBA, if you can have one of the top two or three players, you're willing to pay them anything. The good news is, we're limited in what we can do. So we gave Giannis the max, and it's actually the super max because he had been all NBA. He is a franchise. I mean, you see it, you know it. He's an exceptional individual. He's an exceptional person. And he's a phenomenal basketball player. So it's for those that I think we're lucky to have him. But it's actually for those reasons that we've been able to win. I mean, he's a team player.
Marc Lasry:
He wants the Bucks to do well. And he does what it takes, whether it's shooting, whether it's passing. You saw it in the Philly game. He was really the defense when he blocked that shot. I can't believe how fast he went up. Literally, just to block that. And I was with the owner of the 76ers, and he goes, "Yes, overtime." And I said, "I think it's a good block." He goes, "No, no, no, no. It's goaltending." I'm like, "I don't know about that." He goes, "Oh, it's overtime." And then when it got overturn, he goes, "Damn it. I thought it was overtime."
Josh King:
Well, from Philadelphia last night, let's go back to Milwaukee last July. I'm looking at a video of the scene on the streets of Milwaukee. Here is NBA Commissioner Adam Silver on the Parque of the Fiserv Forum.
Adam Silver:
To our fans here tonight in the 65,000 people outside this arena, it was uplifting to return to arenas to have fans. Over 1.2 million fans attended our games in these playoffs. Thank you very much. To the Phoenix Suns, you fought hard. You had a tremendous season. Congratulations. And the Milwaukee Bucks. To the city of Milwaukee, it's been 50 years. That makes it all that much sweeter. To Marc Lasry, to Wes Edens, to Jamie Dimon, to Mike Bastianelli, to GM Jon Horst. Where's Coach? Mike Budenholzer. What a tremendous job.
Josh King:
What was that night like for you?
Marc Lasry:
It was surreal. I mean, it really was. I think part of it is, while the game was going on, my son was sitting next to me. He goes, "I think we're going to win this." I'm like, "Oh, shh. Stop, stop. Don't jinx anything." And then as you get closer and closer, he goes, "Dad, I'm serious. I think we're going to win." I'm like, "Seriously, don't say another word." And then there's 30 seconds left and it's clear we're going to win. He goes, "I think we won. I think we're going to win." I'm like, "Oh my God." And there's this feeling of... It's relief. I wish I could tell you it was exhilaration. Your first feeling is relief. "Oh my God, thank God." And then it starts sinking in and then you're really excited. But it was a special night. I mean, it really was.
Marc Lasry:
I think for us, it was fabulous. The one thing I remember, which is really embarrassing is, they hand me the trophy and you're supposed to lift the trophy up. And you don't realize how heavy it is. And you go, "Oh my God, I'm on national TV. If I drop this thing, it's going to be so embarrassing." So you're doing it and you're lifting it really slow. And then Giannis picks it up with one hand. He's just waving it. And you're like, "Oh my God, I hope nobody sees him lifting it with one hand. And then they just see me with the two hands going slow." Yeah. It was cool. You go in the locker room and I've always seen these celebrations and how everybody wears these goggles.
Josh King:
Goggles. Yeah.
Marc Lasry:
And I wasn't wearing a goggle. And I never understood why people wear goggles. So the champagne gets in your eyes. You're like, "Oh my God, I'm blind. I can't see a thing." And it's stingy. And so I went in the bathroom, washed my face off, and then put the goggles on. And then I understood it.
Josh King:
I think Smith is actually making some locker room branded goggles just for celebrations. You can't just get an old ski goggle off the rack anymore.
Marc Lasry:
They should. It's cool. It's a lot of fun, and everybody's just excited. Everybody's happy, big smile on their face.
Josh King:
A lot of people shook their heads, maybe, in 2014, when you paid the 550 million for the franchise. Forbes now values the team, I guess, at 1.9 billion. Other people may make other estimates in one of the country's really smallest media markets. But making, Marc, four times your money in six years as something you're used to on Wall Street. But what was your back of the envelope math when you and your partners thought that this would be a good deal?
Marc Lasry:
I thought the deal, when we looked at it, and actually my partner, Wes Edens, the way he viewed it, he simplified it. His view was, "Look, national TV contract. It's coming up in two years. We think it'll be double what it is. So therefor, whatever we've paid 500 million for, we think it'll be worth 750. So the value will go up in two years because you own one 30th and people aren't focusing on that." And he turned out to be exactly right. And that's what it was. The TV contract was three times. So we found ourselves in a situation where literally within about a year of buying the team, the value had gone up pretty dramatically. It's always great when you make an investment that works out that well. The part that's interesting is, you feel like you're a steward. You don't really own the team. You are for this period of time, but you're a steward. The fans own it. The city owns it. You're trying to do what's right for the city, for the fans, until the next owner comes along.
Josh King:
That same year, 2014, the owners put Adam Silver in charge of the NBA after David Stern retired. Adam's had to navigate a lot of crises, from Donald Sterling, to the league's engagement with China, to playing in the COVID bubble. As the league's grown to two billion fans worldwide, 210 million followers across social media platforms, Marc, are we at peak NBA or is there still more room for growth?
Marc Lasry:
Oh, I hope not. I think there's a lot of room. One of the things that's interesting about the NBA is it's absolutely global. That's the difference, whereas, I would tell you baseball, football, are not global. The NBA is. I think we're lucky in that we have the best commissioner in any of the sports. I think he's viewed as the number one commissioner. So I think when you look at this, you look at leadership, and how can you grow your brand? And I think Adam not only is the right person to do that, but he's probably the only person to do that.
Josh King:
I was looking at a story from the in Milwaukee Journal Sentinel from March 11th, 2020. "The NBA suspends its season until further notice after player tests positive for coronavirus." Team had been on a road trip. I think it was coming down to about seven of eight games at home. You were getting ready to begin that March in 2020. What was it like when suddenly your business has to shut its doors?
Marc Lasry:
I think we were all in shock. I mean, I think part of it was, we were all trying to figure out what was going on. Are we closing down for a week, for two weeks, three weeks? And I don't think in my wildest dreams I thought it was a year. I thought, "All right, we'll close down for a couple weeks and then we'll open back up. This will be fine." I don't think we understood the severity of it. We understood the repercussions, the issues that people would have, and how devastating it would be to a number of people and how many lives would be lost. So I wish I could tell you I sort of thought I understood what was going to happen. I certainly did not.
Josh King:
So you've now entered, as of 2014, this exclusive but unique club when you bought into the NBA. We've had the creators of ESPN's, the Sterling Affairs, on this podcast. And right now, Marc, I'm in the middle of Winning Time: The Rise of the Lakers Dynasty on HBO, which is NYSE ticker symbol T, until discovery takes over HBO in a couple of weeks. Here is John C. Riley as Dr. Jerry Buss and Michael Chiklis as Red Auerbach.
Speaker 20:
That play for you in real estate?
Speaker 19:
What's that?
Speaker 20:
Get the sucker thinking with his little head, not his big one?
Speaker 19:
There's that famous Celtic defense. No, come on.
Speaker 20:
You're a student of the game, I take it.
Speaker 19:
Yeah. Look, Fred. I know I'm still the freshman of the class and you're the big man on campus. I get that. I respect it. But I wanted to meet because I'm asking for your help. I'm trying to build something out here, like you built Boston. Like a real dynasty. And frankly, I think that would be good for the league.
Josh King:
Did you see a similar cast of characters when you walked into your first league meeting?
Marc Lasry:
No. I think when I walked into my first league meeting, I was a bit in awe of all the people who were there. It's a lot of people you read about. So when I first walked into that room, I was much more just not going to say a word, stay quiet. You want to sort of get a feel, because most of the people in that room are pretty type A personalities. There's no need to say anything. Somebody was always going to say something.
Josh King:
Did they end up hazing you at all? Or was it pretty much, "Welcome to the club?"
Marc Lasry:
Yeah, the NBA... It's actually interesting. And I've never experienced it before. You're a partnership, so you're trying to do things that are good for the league, but then you're trying to beat the team you're playing. Right? So on one hand, you're partners, on the other hand, you're competitors. That's normally not the situation I find myself in. You're either friends or you're not. And here it's, you're friends with everybody, but you're still trying to beat them. So it's very, very cordial.
Josh King:
In that first episode of Winning Time, it focuses on Dr. Buss's drafting Urban Johnson over Sidney Moncrief after magic beats Larry Bird in the NCAA championship. And I listened to your podcast on the yield on your theory of distressed investing. Do you bring that theory into drafting undervalued players? Are you like Dr. Buss, or do you leave that work to Jon Horst?
Marc Lasry:
Yeah. Jon Horst does that. Where I question Jon is, why are we signing this person for 10 million when we can sign another player who's comparable for a million dollars? Are you telling me the $10 million guy's 10 times better? And John will say, "No, but he's better." I'm like, "I know, but why are we paying him 10? If he's better, we should pay him two." He goes, "That's not how it works." And that takes a while to get used to. Because to me, the guy at 10's got to be 10 times better. And it doesn't work that way in the NBA. The $10 million guy is probably one and a half times better. Or two times better. And the math never makes sense to me, but it is what it is.
Josh King:
Talking about where you first got your facility with math, Marc, you grew up in west Hartford after immigrating from Morocco in the mid 60s. And you and I talked about this at the NYSE this morning, where it's a place where Jim Calhoun had such a great run at UConn and Geno Auriemma is still on that run after 37 years facing off against Stanford tomorrow night in the women's final four. Basketball born just north of there in Springfield, Massachusetts, James Naismith. What turned on to basketball?
Marc Lasry:
I grew up in sort of Hartford. I was on Capitol Avenue. And you go to school and that's all everybody was playing on the playgrounds. I got into it. Played in high school. Played in college. It was a lot of fun. It's a great sport. It's been something that's been with me my whole life.
Josh King:
At college, you played at Clark. And I grew up near Clark and knew some of the athletes who played and coached there and their small size belies their ambition in Division III ball. How did you balance your own ambition as a player versus needing to be a student and get on with the rest of your life?
Marc Lasry:
It's not that hard. You quickly realize you're not that good. You have a lot of fun. But we all have dreams of playing in the NBA. When you're playing Division III, you know that's not happening. So basketball was fun. There's a camaraderie. I just loved being on a team. But I sort of quickly realized the way I was going to move ahead in the world was through academics. It wasn't going to be through sports.
Josh King:
Speaking about being on a team and working with a great coach and a great teacher, here's Coach John Wooden.
John Wooden:
Never try to be better than someone else. Always learn from others, and never cease trying to be the best you can be. That's under your control. And if you got too engrossed and involved and concerned in regard to the things over which you have no control, it will adversely affect the things over which you have control. Then I ran across a simple verse that said, "At God's footstool to confess, a poor soul knelt and bowed his head. 'I failed,' he cried. The master said, 'Though didst thy best. That is success.'" From those things and one other, perhaps, I coined my own definition of success, which is peace of mind attained only through self-satisfaction in knowing you made the effort to do the best of which you're capable. I believe that's true. If you make the effort to do the best of what you're capable and trying to improve the situation that exists for you, I think that's success and I don't think others can judge that. I think it's-
Josh King:
Wooden also said, "If you're not making mistakes, you're not doing anything." Marc, and I've heard you talk about making mistakes before as you and your sister are building Amrock Investments and Avenue Capital. What lessons are you taking from the boardroom to the Parque, based on the mistakes that you've had over the years?
Marc Lasry:
I actually agree with Coach Wooden. I'm a big believer... Don't worry about the things you can't control. I don't worry about the weather. I can't control it. I don't get bummed, "Oh, it's raining today," or, "It's too hot." It is what it is. I focus on what I can control, and what I can control, I try to use that... Whether it's for us to try to make money. But when I talk to Jon Horst, it's much more about, "Look, should we take the risk here?" Giannis was a risk. Right? Giannis, when he was drafted with the 15th pick, there were players who were more accomplished than him at the time. But the bet was that if he could develop, he could be great. That bet turned out to be right. If you were worried about making a mistake, you wouldn't have drafted Giannis. Right? So I'm a big believer... You got to try to do the best you can. And don't worry if you fail. Pick yourself up and go try something else.
Josh King:
One of the big issues, some say, maybe big opportunities facing the NBA and other sports, legalized betting. With it already legal in 33 states, California, perhaps biggest prize of all, voters are going to have their say there in November. You've joined a funding round for Lucra Sports, a peer-to-peer betting app. How do apps like Lucra stand to change the way all of us engage in sports?
Marc Lasry:
Lucra is a community. And it's betting with your friends and meeting people in that environment. Lucra was started by one of my best friend's sons, Dylan Robbins, who I just thought was an exceptionally bright individual. Had a great idea. I hope he's absolutely correct. If the thesis works out, Lucra could be one of these large bidding apps. I think the thesis is correct. And that's sort of why I invested in it.
Josh King:
Talking about other bets that you've been making recently, Marc, it's not the NBA or the NFL. But I am probably the only owner of a private pickleball court in the tiny hamlet of Windham, New York. You're an investor in the MLP, Major League Pickleball. And now you've got Gary Vaynerchuk as an owner of one of your expansion teams. Tell our listeners what I already know about the phenomenal sport that is pickle.
Marc Lasry:
I think it's the fastest growing sport. And part of that is we're all getting older, and for people who love sports and who love playing and have really good hand eye coordination, pickleball is just fabulous. You can play singles. You can play doubles. Wherever I go, I find that people want to play it. There's all these pickleball courts. Part of the reason I invested in it is I play on a tennis league over the summer. And as I would go at different tennis courts where we're playing different towns, all I saw was that people were building pickleball courts. And it wasn't one. It was four or five, or they were turning over their tennis courts into pickleball courts. And I just found it fascinating that here was a sport that I think five years ago, people didn't really know much about. And all of a sudden in five years it's grown as fast as it is. So my view was, look, I'd love to buy a franchise. And hopefully if it keeps doubling or growing the way it is, that franchise could be worth quite a bit.
Josh King:
After the break, Marc Lasry, owner of the Milwaukee Bucks, co-founder and CEO of Avenue Capital, and I will dive a little deeper into what makes him, the Bucks, and Avenue Capital tick. That's all coming up right after this.
Speaker 16:
And now a word from on holding NYSE ticker ONON.
Speaker 24:
Pause is essential. It's part of the process.
Speaker 18:
Training doesn't end when my body stops moving.
Speaker 19:
Recovery looks different for every athlete. We have different needs, different goals, different abilities.
Speaker 18:
One thing we share, our bodies need time. Time to heal.
Speaker 19:
The moment I stop training for the day, what people maybe don't realize is that the training is still going on.
Speaker 20:
In a way, the training never ends. The journey just starts again.
Speaker 18:
Pause is sanctuary. Familiar spaces and comforting routines. It clears your mind and rebuilds your body.
Speaker 19:
Let the healing begin. Time to reset. There's power in pause.
Josh King:
Welcome back. Before the break, we were talking to Marc Lasry, owner of the Milwaukee Bucks, co-founder and CEO of Avenue Capital, about his team's run through the playoffs and his own introduction to the league. Now we're going to pivot. You got your SAG card through two cameos on Billions on Showtime in seasons three and five, and Brian Koppelman and David Levine have been both guests on this show when they were ringing the bell. Here is another cameo with one of the NBA's best, Kevin Durant.
Bobby Axelrod:
To be honest, he's not that good a friend, and he's probably not even a good kid. But his father wants to support the Kevin Durant charitable foundation to the tune of 50K.
Kevin Durant:
So if its worth 50K, then itsgot to be worth 100, right? We do some really, really good things, Axe.
Bobby Axelrod:
Huh? All right. Done.
Bobby Axelrod:
His name's Stevie.
Kevin Durant:
Stevie. This is KD. Happy Bar Mitzvah, my man. Enjoy.
Josh King:
Brian and David talk a lot about how they speed dial hedge fund titans for ideas for more authenticity on the set. How close do they come to being the real thing?
Marc Lasry:
There's a lot of things that are real and there's a lot of things that are not, I'll leave it at that. But Brian and David are great guys. They know how to tell a story. They weave a lot of reality into the show. So I'm a big fan of theirs and I'm a big fan of the show.
Josh King:
So at about the time that I am flying around with Bill Clinton in 1994, you and Sonia are founding Avenue Capital. The firm now has 12 billion under management. How did you develop your investing philosophy?
Marc Lasry:
I clerked for the Chief Bankruptcy Judge. So my focus was always on things that, what could you buy below the asset value? Right? If something's worth a dollar, could I buy for 50 cents? I always wanted to try to buy from non-economic sellers. I don't want to buy from you. I only want to buy from you if you're buying a house and you've got to sell some stock or you got to sell things so you can buy your house. So therefore, you're making a non-economic decision, right? So I'm very focused on non-economic sellers as opposed to economic sellers.
Josh King:
I had Steve Schwartzman on the show when he published his book, What It Takes. And there were existential moments when he and Pete Peterson wondered if their business model is ever going to take hold or whether they should fold their tent. Did you and Sonia ever have an "oh shit" moment?
Marc Lasry:
Oh I had it all the time. I think when we all start out, we have those moments because it's just hard in the beginning. In anything you do, you're going to have issues. Things are going to be hard. You've got to convince people that you're right. It takes time. It just does. Nobody starts off with everything being great. I think Sonia and I, when we started in '95, yeah. It was hard. And it should be hard. It's not that easy to succeed. You've got to work exceptionally hard. You've got to get lucky. You've got to be in the right place at the right time. So I think for Sonia and I, we worked really hard, but we also got lucky. And we were able to do things the right way. And because of that, the firm was able to.
Josh King:
I'm close to my brother. My wife is close to her only sister. That doesn't mean we do business with them. The four Bass brothers, as you well know, parlayed $12 million of their uncle Sid's estate into a fortune of nearly 12 billion. What are the puts and takes of going into business with your sibling?
Marc Lasry:
You got to have different personalities. You can't be the same person. And what I mean by that is, what I love to do is not what Sonia loves to do. And what she loves to do is not what I want to do. So because of that, we could delineate different things and I could focus on what I wanted. She could focus on what she wanted and we never really competed against each other. And I think with siblings, that's the biggest thing. I don't know if my boy could... They're super close, but I don't see them being in business because they're very similar. So each one would want to be in charge. Right? And each one believes they're right. And I think they're both right. But I think in any business, somebody's got to make the decision. You've got to be with a partner who, you've got a different skillset.
Josh King:
The financial crisis of 2008, 2009 changed that calculus of your philosophy a little bit, buying corporate debt at a discount and waiting for it to recover. How did you adapt?
Marc Lasry:
You had to believe that it was short term. It wasn't really adapting. I mean, you had to believe that you were buying something that was at a discount, and that because of exogenous factors, it was trading lower than the value of it. And that sooner or later, reality would come back. The problem with the financial crisis was, you had to be able to wait for reality to come back.
Marc Lasry:
So the fact that you had all these non-economic sellers and everybody was selling, we were buying Ford bank debt and we started buying it at 80 cents. Then 70, then 60, then 50, then 30 cents on the dollar. And each time you bought it, the market was telling you were wrong, right? 'Cause you just kept buying and it kept going down. We had the luxury of time because we had money that was locked up and sort of two years later, Ford Bank debt was trading above par. If you were one of the people that was forced to sell, doesn't really make a difference. You were forced to sell. And the fact that you sold it at 60 cents and it went back to par, nobody cares. What they care about is you sold it at 60.
Josh King:
Talking about people being forced to sell, making non-economic decisions, Marc, a 2010 profile of you in the Wall Street Journal had you negotiating with Donald Trump over the restructuring plan for his bankrupt casinos. You are a friend of other presidents, Bill Clinton, Barack Obama. I imagine that if President Biden stood on the New York Stock Exchange podium where you stood today, his reception wouldn't be as welcome as yours. And what advice would you give to Ron Klaine and Steve Ricchetti, Bruce Reed, about how to rekindle that atmosphere of cooperation with Wall Street that both Clinton and Bob Rubin had in their day, Obama and Tim Geitner, had in theirs?
Marc Lasry:
I would say the country is in the middle. And if you want to philosophy that's very much the left, you're going to have a hard time. And that ultimately, Wall Street fuels a lot of the expansion of the United States. And if what you constantly want to do is fight with Wall Street, it's fine. I mean, you can. And it'll mean that people take longer to invest. And so whatever recoveries you want will take longer. And other people will tell you, "Well, look, I disagree." I think everybody has a right to their opinion. I just think ultimately, at the end of the day, capitalism fuels a lot of this market and you've got to choose, do you want the market to fuel it, or do you want the government to fuel it? Sooner or later, somebody's got to put the money there. If your philosophy is the government will do it, that's fine too. But I think you ultimately need Wall Street to help in what you're doing.
Josh King:
Wall Street helping both what's happening in Washington, but also so invested in what happens here in New York City today, Mayor Eric Adams and governor Kathy Hochul attended the annual meeting of the partnership for New York City at the Rainbow room. And here is Mayor Adams at the New York Stock Exchange just a couple of weeks ago.
Speaker 24:
Let's talk about what the mask mandate going away will mean. Not just for the school children in the city, but obviously for people who come here and work as well.
Mayor Adams:
Well, it's a combination when you think about it. Moving our economy forward is not only substantive things we must do keeping our city safe, but it's also symbolism. When we take up the mask, we're going to start to show that we are open. We're ready to do business. May start out as two days a week, going back into the office, then expand to five. But it's just a symbol that we are back and it was so important.
Speaker 24:
Yeah.
Josh King:
Marc, Mike Bloomberg was a billionaire who ran New York City pretty well. If you moved a few blocks north to Gracie Mansion, what are some of the things you'd do to help New York get back on its feet?
Marc Lasry:
I think I would focus a lot on sort of housing. I would focus on sort of making sure pew people were getting paid fairly. I would focus on education because I think those are sort of the pillars that we need. I would try to make it easier for people to do business. I think a lot of things Michael did actually were great for the city. What you would try to do is learn from everybody's mistakes. I think every mayor or every governor, there's some things that they've done that's been really positive and there's some things they've done that it's not. And I would try to focus on things that were positive and try to add to those or make those hopefully a little bit better.
Josh King:
Speaking of people who move into government service, you were rumored to become our man in Paris under president Obama, but it didn't come to pass. And today we see folks from the business world like Jeff Zients taking leave to manage Biden's COVID task force. But what about the nomination or confirmation process makes it so difficult to get more successful Americans to enter public service?
Marc Lasry:
The perception of conflict is the biggest issue, right? So I think for me and for others, what ultimately happens is, so that there's no conflict, I would've had to sell my interest in Avenue. And I think for people there's a cost to all of that. If the cost is minimal, I think people do it. If the cost is very expensive, I think it's hard. And I think the that's what's limiting a number of people. And I don't think the government is wrong. I think you don't want to have any conflicts. You want to try to set things up so that the perception is that everything is being done the proper way. But there's a cost to that. And I think we all have to decide if we're willing to live with that cost. And I think for President Biden and others who are trying to find talented individuals, they don't want to have any issues with conflicts, which I totally agree with. So I think ultimately, it's going to be that way and it's just going to limit people and it is what it is.
Josh King:
One of the things I've heard you advocate for once is seemingly the simple change of allowing people to vote from their computers or smartphones instead of a polling place. And yet the issue of the moment is voter suppression, not voter expansion. Do you have any hope that the country is going to change course, say, in the next six or eight years?
Marc Lasry:
I hope they do. But technology just keeps expanding and it keeps getting better. So I think sooner or later, we'll get to a point where hopefully on the technology side, we won't have any concerns about it. But I couldn't have fathomed, when I think of technology when you and I were kids, that... I didn't even, you could look into a phone and you'd see somebody... You'd be able to talk somebody through FaceTime. We had landlines, right? There's no such thing as sort of a phone that wasn't attached to anything and that you could talk somebody through the air. So I think all of this, we will get there. The question is, how long does it take? Right? So I don't really worry about it. I think technology will solve a number of problems. I just hope they're able to do all those things in my lifetime.
Josh King:
I'll close on this. As we wrap up mark, you are the son of an immigrant. And Joseph P. Kennedy, Sr. was the grandson of an immigrant. His son ran for the US Senate against Henry Cabot Lodge in 1952. And in 1959, the year that you were born, Senator Kennedy dictated a letter to his father. Let's listen to how that starts.
Senator Kennedy:
Dear Dad, this is a letter to bring you up to date.
Senator Kennedy:
I'm in closing an article in today's paper by Joe Alsop, reporting his visit to Pennsylvania. The article indicates that Lawrence is still giving out same old spiel in regard to the Catholic question. I had a long talk with Matt McCluskey the day before yesterday and he feels that unless we can get a more positive commitment from Lawrence which seems unlikely, that we should enter the primary there.
Josh King:
Marc, your son Alex is trying to follow in the footsteps of Bill Proxmire, Herb Cole, and Russ Feingold. And I don't know if he's dictating any letters to you, but what's your advice to him as he faces that primary in August against more challenges from the left, frankly, than the center?
Marc Lasry:
He and I have talked a lot about this. I said, "Just be who you are. People will vote for you if they trust you, if they like you, and if they believe in you. I wish it was more complicated than that. And all you have to do is get one more person to do that than whoever's on the other side." So I'm biased. I think he's a phenomenal candidate. I think he's smart. I think he's the right person to represent the state of Wisconsin. And hopefully other people agree with that. I think that's what's happening. He's moved up quite a bit in the polls.
Josh King:
Saw the recent polls. They're looking good.
Marc Lasry:
Yeah. He's up to 28%. I think that in the next poll, hopefully he'll be tied or be ahead. But he's doing a great job. He helped build our arena. He's done all these great things for the state. So I think people are actually following him and are supporting him.
Josh King:
And on that note, I'll let you go back to your work at Avenue Capital, Marc. Thanks so much for joining us Inside the ICE House. Thanks for bringing the team to the NYSE, and best of luck in the playoffs.
Marc Lasry:
Thank you very much.
Josh King:
That's our conversation for this week. Our guest was Marc Lasry, owner of the Milwaukee Bucks, co-founder and CEO of Avenue Capital. If you like what you heard, please rate us on iTunes so other folks know where to find us. And if you get a comment or a question you'd like one of our experts to tackle on a future show, or someone you'd like us to have on this show.As a guest of the ICE House, email us at [email protected], or tweet at us, @icehousepodcast. Our show is produced by Pete Ash and Ian Wolf with engineering and editing by Ken Abel and Steven Capriles. I'm Josh King, your host, signing off from the library of the New York Stock Exchange. Thanks for listening. Talk to you next week.
Speaker 1:
Information contained in this podcast was obtained in part from publicly available sources and not independently verified. Neither ICE nor its affiliates make any representations or warranties express or implied as to the accuracy or completeness of the information and do not sponsor, approve, or endorse any of the content herein. All of which is presented solely for informational and educational purposes. Nothing here in constitutes an offer to sell, a solicitation of an offered to buy any security or a recommendation of any security or trading practice. Some portions of the proceeding conversation may have been edited for the purpose of length or clarity.