Bill Ackman: Dealing with Haters, My Largest Trade Ever, and Sounding the Alarm for the Government
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- čas přidán 26. 06. 2024
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Legendary activist investor, Bill Ackman shares new details on the biggest trade of all time, the lessons he learned from Warren Buffett and Charlie Munger, how going through a divorce affected him, coming back from the brink of failure, and for the first time details on his sleep, exercise, and nutrition habits
0:00 Start
02:33 Lessons from parents
04:46 Driven by independence
05:09 Overcoming failure
06:11 Hard earned lessons learned
07:20 Small improvements; Grounding yourself in the moment
07:51 The most important thing
08:35 Admiring Elon Musk
08:55 What Success Means?
09:19 Overcoming setbacks
11:49 On divorce
12:53 His sleep, exercise, and nutrition habits
15:40 What he watches on Netflix
16:03 What he reads
18:02 How he sources investment ideas
27:27 Index Funds and ETFs
33:04 Heroes
41:52 Herbalife in detail
44:28 Dealing with Haters
46:46 The biggest trade in history (26m to 2.6b in weeks)
56:00 Credit Default Swaps
01:00:16 Economic Implications of COVID
01:08:57 Economic bailouts
01:12:00 Are Malls Dead?
01:14:33 Predictions After COVID
01:16:51 Berkshire Hathaway
01:22:13 Lessons from Warren Buffett and Charlie Munger
01:26:16 The future of Pershing Square
01:27:29 How the SEC should operate
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2:36 Lessons learned from parents (Philanthropy)
5:19 View about success and failure
- Success is not a straight line
6:13 Lessons learned from mistakes
- Business Plan: Make a little progress everyday
7:32 Getting incrementally better
8:19 Single most important thing you need to understand is how to deal with failure.
9:01 Success is you have a very good ability to deal with inevitable failure
9:14 How to you reset yourself from failures.
- Plotting one step at a time.
13:44 Nutrition
15:39 Last movie that he loved
16:11 What do you read regularly?
- WSJ, FT, NYT, Economist, Fortune, Grant's interest rate observer, Twitter, Bloomberg
18:09 Where are investment ideas come from?
27:30 Role of ETFs and Index fund in investing
33:03 - Who are some of your heroes?
47:36 CNBC (Hell is Coming) interview and CDS things
51:14 Why hedge? (instead of selling everything)
56:03 Why CDS investment ( of $26M) is understated.
1:00:18 Economic implication of Coronavirus
1:04:25 How does Coronavirus affect real estate?
1:05:33 What causes you to change your mind?
1:22:33 Influential things from Mr.Buffett
Wow thank you
Thank you
My brudda
Thanks 👌🏻
Amazing!! I appreciate it..
Carl Icahn said Bill has to be one of the most arrogant people he's met but the man is a very successful investor, and even after amassing such an enormous amount of wealth still says words such as "lucky" and "privileged" with such humility. I've seen and heard some of the few available interviews (there should be more) of this man and I've seen nothing but a humble and down to earth person.
I agree. Meanwhile Carl Icahn comes off as an extremely arrogant person, in my opinion.
Humility comes off as arrogance to the feeble minded.
@@reamus9102 my observation as well
I've been following Icahn and Ackman for years...Icahn is the arrogant one.
He comes off as being arrogant because he outsmarted Icahn. In the world of private equity, it’s a dog eat dog and dude got chewed up and someone took his lunch. Ackman is a legend.
I've met Bill a number of times and he's such a humble guy, always up for chatting. Legendary investor
This is great. Love the way Bill talks. So articulate with his answers
Cool channel man!
Attacking Herbal life is the best thing Ackman has ever done ✅
Not the best outcome. But the most noble thing without a doubt.
Herbalife*
@@troymediadigital5811 Yah it may of not been a great outcome, but if that never happened he wouldn't of learned from those mistakes.
@@PonzRL Yeah and honestly he was right about that company. They are absolutely a pyramid scheme. its too bad our capitalist system allows companies like that who provide so little value compared to their cost. If you have to rely on shady practices like making your customers feel like employees or contractors than you don't deserve to be in business.
I don’t understand because in an interview with interactive investor in the uk, Bill said because of the structure of the Pershing Square Holding that there was no capital gains tax to pay on the sale of securities?
Great interview. 360 degree questions. Asked from health to uncomfortable questions. He handled it like a total professional. No doubt why Bill Ackman is where he’s at after this interview. Automatic subscription after this.
The farnam street/knowledge project content has totally changed my life, and the quality of my thinking. I can’t thank you all enough for everything that you’ve shared!
Bill Called me literally Friday Morning. No Bullshit. I want people to know Mr. Bill Ackman is a Kind, Generous Person, He like to Teach. A top investor on Wall Street most everyone admires. And over the years of watching him perform, You keep marching on. Even when things don’t go your way, No matter the feelings you feel. Love the Podcast Thank you. 😊👏👏
@Bleu Barclay He called me to see when I would be in NYC next to go to Lunch, plus I sent him some info on a new Spot for Fly Fishing. We are Fishing Buddies.
Ask Munger for an interview!!! For us, bunch of nerds this would be awesome🥰🥰
We want Bill Ackman again on this podcast.
Bill Ackman is a beautiful man.
Listen and study the philosophy of smart people. Bill Ackman is one of them.
Wow!! This is amazing! Bill Ackman is one of my entrepreneurial and investor idol. I love it that he’s winning!!
Truly appreciated the teachings and thought leadership throughout this piece. Thank you both.
What a interesting and insightful piece. Bill is a so well spoken and intelligent.
First time here. This was fabulous! You asked good questions and let him answer. Look forward to listening to the others, this sets a high bar.
you are in for a ride then. Almost every episode is a gold mine.
This was excellent. I had been looking for an Ackman interview like this
Great interview, I have new respect for Bill Ackman, I have alot of things in common with him from an outlook on health to loving that 88% endangered species dark chocolate. It was like listening to myself just without all the money😂
Watched this when it came out, a year late and I'm balls deep in PSTH LEAPs.
Take me to the moon Billy boi 🚀
found this channel yesterday and ive become addicted
i cant get enough of Shane. The questions and brevity which asked is refreshing
the way bill talks. especially in a podcast where you can't see him. he souinds so much like peter lynch.
Excellent Podcast! And Bill Ackman is an idol
This is gold. Please do more
Amazing. Love ur podcasts!
Probably his most insightful interview yet! Great job!
Wow, very insightful, thanks for a great interview with a great investor
That was a terrific interview.
Bill Ackman is smart
This is the best interview I have ever seen on youtube
😂
How about Gregory? czcams.com/video/aD9wJoEfHvE/video.html
Very good very high quality content. Wasn't expecting it will be this good. It was due to my prejudgement on valeant related netflix episode. Wish he also covered that during this interview. Was joyful 1.5 hours
Great episode
Great interview, I love investing legends
🎯 Key Takeaways for quick navigation:
00:00 🚀 Success is not a straight line; dealing with failure effectively is key to success.
00:28 🎙️ Bill Ackman discusses his views on success, failure, and the importance of persistence.
01:44 📈 Bill Ackman talks about his background, disclaimer, and introduces the podcast with Shane Parrish.
02:22 💼 Bill Ackman's interview with Shane Parrish begins, covering various topics.
02:37 🏆 Lessons learned from Bill Ackman's parents: persistence, hard work, and philanthropy.
03:45 💡 Bill Ackman discusses the perspective of giving back and philanthropy.
04:54 🔥 Bill Ackman's drive for independence and how it has shaped his life.
05:21 🔄 Bill Ackman's perspective on dealing with failure and how it contributes to success.
06:15 📚 The importance of learning from mistakes and experiences in one's life.
07:26 🤝 The significance of having a support network of friends, family, and staying healthy during challenging times.
08:46 🎓 The importance of learning to deal with failure, especially in educational institutions like Harvard Business School.
09:27 🚶♂️ The approach of taking one step at a time and making steady progress in overcoming challenges.
10:08 🌃 The role of maintaining perspective, having a loving relationship, and staying healthy in managing stress.
12:54 🌙 Bill Ackman's routines for sleep, exercise, and nutrition for stress management.
13:36 🍎 Bill Ackman's views on nutrition, including reducing sugar intake and focusing on real, unprocessed foods.
15:09 🍽️ Bill Ackman's intermittent fasting routine.
15:23 🌃 Bill Ackman's evening routine, including reading and spending time with loved ones.
15:50 🎬 Bill Ackman's recent enjoyment of the Netflix series "Unorthodox."
16:33 📰 Bill Ackman's sources of information intake, including traditional media and Twitter for real-time news.
17:10 🤝 The value of conversations with business leaders for gaining insights into various industries.
18:06 📚 Bill Ackman discusses how investment ideas are sourced, focusing on high-quality, predictable businesses.
19:55 🧐 Bill Ackman's approach to conducting extensive due diligence on investments and the luxury of time in a concentrated portfolio.
21:44 💼 Bill Ackman explains the importance of business quality, simplicity, durability, and predictability in investment decisions.
23:07 ☕ Bill Ackman's investment in Starbucks as an example of a high-quality, predictable business that met their investment criteria.
24:01 💼 Bill Ackman emphasizes the importance of understanding the gap between price and value when investing in businesses.
24:29 💡 Ackman discusses the significance of analyzing whether a company's poor performance is a temporary issue or a sign of long-term problems.
25:12 📊 Ackman's investment approach focuses on the long-term intrinsic value of a business rather than short-term fluctuations or quarterly earnings predictions.
26:21 🕰️ Having long-term capital provides Ackman's firm with an advantage, allowing them to make decisions without being pressured by short-term market fluctuations.
27:30 📈 Ackman discusses the impact of ETFs and index fund investing on corporate governance and the need for collaboration between activist investors and index funds.
31:23 📉 Index funds can reduce the liquidity of securities, making them more vulnerable to price swings driven by active investors.
34:19 🧭 Ackman admires individuals like Elon Musk who take on significant challenges and succeed.
35:43 🏢 Ackman believes that some companies stay private for too long, leading to governance and valuation issues.
39:08 📉 Ackman sees short selling as a valuable tool to uncover fraudulent companies but cautions against shorts trying to harm businesses intentionally.
46:20 🦠 Ackman discusses his concerns about the handling of the COVID-19 pandemic and his call for a nationwide shutdown to protect public health.
47:39 💰 Bill Ackman made a $2.7 billion profit by hedging against market declines in February and March 2020.
48:08 Ackman decided to exit the hedge and invest aggressively in stocks because he believed that if the government took the right steps to combat the pandemic, the markets would recover.
49:28 Bill Ackman emphasized the importance of stopping the virus through a 30-day lockdown to restore market confidence and enable economic recovery.
50:52 Ackman acknowledged that while he couldn't control market movements, he strongly believed in the positive outcome of his strategy and invested billions in buying stocks.
51:46 Ackman chose not to sell everything to exit the hedge because he didn't want to abandon companies he had supported and because of potential frictional costs and tax liabilities.
55:29 The decision to hedge credit risk was made when the economic implications of the pandemic were discussed in late February, with the expectation that the virus would spread further.
57:07 Ackman viewed the premium payments for credit default swaps (CDS) as a relatively low-risk commitment due to the expected short duration of the hedge.
59:43 Bill Ackman explained that the entire globe is in a temporary shutdown due to the pandemic, and governments are providing economic support to bridge through the crisis.
01:00:32 Ackman believes that technology and testing will play a crucial role in overcoming the crisis and returning to normalcy.
01:06:36 Ackman mentioned that industries like Amazon and technology companies are likely to come out stronger from the pandemic.
01:08:37 Bill Ackman discussed the importance of directing capital to capable hands and providing support to businesses that need it during the bailout process.
01:09:16 📉 Bill Ackman believes that taxpayer money shouldn't be used to save businesses in structural decline, and government support should come with an adequate return on investment and equity upside.
01:12:16 🏢 Bill Ackman thinks that malls can still have a future as public gathering places, but they need innovative and appealing tenants to attract people.
01:14:37 💼 Bill Ackman anticipates that people will seek more human connection after the pandemic, increasing the demand for social experiences, cafes, restaurants, and entertainment venues.
01:17:08 💰 Ackman sees Pershing Square Holdings compounding its value by investing in public companies and becoming a long-term holder.
01:27:45 🕵️ Bill Ackman suggests that the SEC should work more quickly and be more aggressive in addressing companies causing harm, relying on insights from short sellers.
01:31:28 📉 Short sellers play a valuable role in identifying fraud and market misbehavior, which helps prevent extreme market conditions.
01:33:03 🏛️ The COVID-19 pandemic has highlighted both the strengths and weaknesses of democratic systems, where transparency and a free media allow issues to be surfaced, but quick, decisive actions may be delayed.
01:35:46 🧒 Bill Ackman emphasizes important life lessons for his children, including hard work, education, treating others well, and persistence, drawing from his parents' qualities.
Made with HARPA AI
Sounds articulate and fairly well grounded. Self awareness helps.
Finished! Really interesting point of view and loved the entire interview session! Definitely planning to watch more videos of this channel.
Endanger Spices 88% xD getting it.
You are an excellent interviewer Shane!
Such a sick interview. Super interesting to hear him predict Berkshire strategy and be pretty accurate in retrospect
Amazing interview questions and dialogue you earned a sub!
Great interview, subscribed!
55:54 bill's CDS setup: $500m premium per year × 5 years, credit spreads of ~50 and 330 bp for investment grade, HY respectively. ($71b notional insurance; 70 bps payment)
@ time of contact: Pershing = ~$7.5b
47:34 Bill's corona hedge, 3rd week April to March 12th unwinding and “aggressively buying stocks”
22:11 simple predictive free cash flow-generative business (SPFCFGB .. easy!)
33:22 Joe Steinberg & Ian Cumming, Leucadia National Corp
Awesome . Every statement is a gem !
Great podcast !!!
Now this is how you interview someone. Great insights.
I agree how you have a value based approach for companies
Would love to hear Chamath and Cathie Wood talking on your podcast!
Zhe Li YESSS
Yes please!!
Yess!
Yes that’d be nice!
Just happened 😀
fantastic.
22:11 simple predictive free cash flow-generative business (SPFCFGB .. easy!)
33:22 Joe Steinberg & Ian Cumming, Leucadia National Corp
Thank you!
Great questions 🙏
Great interview. Shane- You do a great job of listening and not interrupting your guests. Thank you.
Great content. New subscriber
very interesting conversation. great stuff we learned.
The ACK-Man legend 🙌 great podcast! Thank you
Bill Ackman naturally got into keto. Nice.
13:46 Sugar is Poison
facts
61:07 Amazon will come out big !!!
Ackman’s a contrarian with a wiring for penetrating insightful analysis. But I’d like to hone in on the question about stress/rebounding. It’s disappointing when they start commenting on dealing with stress. People have different reasons for being stressed, some of which are self inflicted luxuries and others which are involuntary (not having a natural family safety net for instance). Same goes with nutrition.
Anyway, the main reason I have Buffett #1 is that he never says he deals with stress with some set method (or whatever talk/fashion of the moment; obviously, being happy in personal life helps with stress; is eating like a Spartan worth it if you’re very unhappy?) He and Munger almost always say look it’s hard, but no one ever said it would be easy. In other words, coping is how your cope, but they aren’t removed enough to suggest it’s a formulaic solution bc they know they would be biased given their advantaged starting point.
A great interview man, not a lot of info on how bill thinks
Very good advisor for investor
I’m sorry to say but it’s not a drug or vaccine that is the greatest defence against a mild virus such as covid. Focusing on health and the politicians and doctors talking about health is the most important thing for humans going forward. Bill and other donors to charities should donate to organic food production,get rid of chemical foods and support integrative and functional medical doctors.
Bill Ackman is the guy who deserves the big short movie, he succssesfully shorted more companies (and some unsuccssesful) than Michael Burry.
So true - at university you get used to following the bouncing ball - the syllabus - and the real world change over time.
These are times when investments has really become the prior task for achieving actual success, courtesy of the professional assistance of an expert funds manager I’ve been able to generate a passive income streamline from my investment returns in the financial market
Future conditions could only reduce the level of job availabilities so it’s safe to secure a viable means of regular income and nothing does it better than investing
for as long as i can remember i’ve procrastinated on my plans to venture into the finance market, how do you run your investments with your fund manager?
@@ux4kv3yb2t I contracted an expert funds manager by name Ronald B. Furey who provides an investment management service to manage and grow a certain amount of my income by investing them into various market commodities (stocks, forex and cryptocurrencies) with his superior expertise giving me a much better standpoint and chance of earning colossal profit returns. His ability to create strategies that works in accordance with the market trends is something that comes easy to him and I’m glad I took advantage of that, with a total grossed profit of over $67k
@@ux4kv3yb2t If you might require his professional assistance reach out to him on what s app
* 1 3 8 5 4 3 7 1 1 5 8
please make a videos on the topics of cybersecurity experts CEO
47:34 Bill's corona hedge, 3rd week April to March 12th unwinding and “aggressively buying stocks”
Funny, hedge in at front month switch and closed position and into the equity market at the next front month switch.. derivatives dynamics will one day come to haunt this.. Dalio funny enough also managed to perfectly hit market selloff in March back in November
Can someone explain to me why he wanted credit spreads to widen? I know obviously to make more money, but how does that work exactly?
Because my understanding of credit spreads were the buyer (Ackman) was paying a premium either monthly, quarterly. So if spreads were to tighten he would be paying less on the premiums, but the CDS would decline in overall value right? Then from the other perspective if the CDS spreads widened he'd be paying more in premiums yes, but the underlying CDS overall value would increase more and more like it did in this scenario.
I'm sure I have a lot of that wrong, but that's my base knowledge and anyone who understands it well in relation the spread and how he benefited elaborating would be appreciated. Thanks!
Patrick Reilly Hi
So widening of credit spread means ( net difference between a security with no credit risk aka a risk free bond and the security under consideration that is risky security , for this case let us assume that to be a corporate bond of a company which doesn’t has very predictable cash flows and highly sensitive to underlying economic environment.
So if the economic environment deteriorated investors would start dumping that bond which would increase the yield on that bond effectively increasing the credit spread.
Now, to make money on that you can buy a Credit default swap which is structured in a way where an investor pays a certain amount (just like insurance) to buy a guarantee that he would sell that security to him at the agreed price at the time of initiation of the contract( just like a put option).
Just like any other insurance where the premium is decided based upon evaluation of potential risks and probability of outcomes, CDS is evaluated and the premium is set.
By buying CDS you are implying that you view that the security is likely to go down in value (aka the yield and spreads would increase) and the value of the contract that you have bought will increase as the bond has become more risky as the economic environment deteriorated.
In late feb bill bought those CDS and in a few weeks time the bonds became more risky and so did the spreads widen effectively increasing the price of the contract he holds.
Hope that explains properly !
@@mohommedrizvi2918 Hi Abbas, Yeah your explanation definitely helps, but still a couple questions if you could..
1. Did Ackman necessarily buy the underlying bond/debt? I mean technically you can buy a CDS on an asset even if you don't own the asset right? I got the sense that's what Ackman had done.
2. So in that scenario, assuming Ackman brought a CDS on an underlying asset he didn't own, when the spread widens like it did for him. What does that look like from a pricing standpoint?
Thanks again for your insight and comment.
Gems
You sure will have 50k subs within 6 months and 100k within a year.
Next year? 1 million!
Start ups always take time but being persistent will get you out of the any hole. (;
33:22 Joe Steinberg & Ian Cumming, Leucadia National Corp
The USA has no media since 2008
Short sellers expose fraud
Each state was very different for the c virus 🦠
Has ackman guarded against himself?
I am a fan of Bill, but this guy said "lets shut this down" while making huge profits. The profits have been made and now he is saying "okay, we con open back up". He should not have told people to shut down while holding the fund, low class for Bill A.
.
Bill Ackman is married to a brilliant and beautiful woman. I can't understand it. :)
Just a regular J. Paul Ghetto.
Oh, goodie, Bill's done having his CNBC sponsored panic attack. I. Don't. Like. This. Guy.
He literally runs a hedge fund. Just because he shorted (hedged) the market doesn't mean he is a crook. Actually means he is doing his job (and doing it well). He saw what others missed. Haters gonna hate
I'm new to the stock market but I find these kinda of people inherently untrustworthy
Is it to be assumed he was trying to stoke panic in that Feb performance he pulled to better his hedge position ? Because if so he's evil
Profiting off other people's losses is pretty evil as is
how refreshing, an ethical hedge fund manager. only 25 million now unemployed cuz of vultures like this. nice work, scumbag!
Crawl back in your mom’s basement!
Hahahahahah nice one bro ❤😂
Bill Ackman admiring Elon Musk reduces his credibility and honestly makes me question his investment ability after already being scammed by valient.
Also he shouts out muddy watters and Carson Block knows alot about Musks fraud
He said he admired him, he didn't say he was investing in him or backing him.
Do elaborate on Musk’s “fraud”....
Herbalife is 12/share now.