YouSaid · the spoken record

Allison Schrager

lines on the record: 103
first: 2019-07-19
most recent: 2019-07-19
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Yeah, and then it was worse with jet skis because now you can have a jet ski push you not only in an 80 foot wave, but if you only belong in a five foot wave, now you can go on a 20 foot wave. And you pose risks to other people when that happens. If you need to be rescued. And now the big debate is on something called these inflatable vests. Right.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Totally, because I don't know anything about surfing and I've never done it, but apparently before there were leashes, if you wiped out, you lost your board and you had to swim to shore, and that could be maybe 20 miles. So you think they were like amazing swimmers. Now you can be a pretty mediocre swimmer and still.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, and when I went to the big wave surf risk, every innovation resurfaces this issue. Initially, it was leashes because everybody hated.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I mean, that is, I felt like an important thing to include in any book on risk, telling you how to, how there's all these tools that can reduce your risk, is then you have to be mindful of not feeling so safe that you can then go and take whatever risks you want. Because nothing makes the world truly risk free. You know, risk is all still an estimate of something that's immeasurable. And you're basing your risk strategy on something, you know, it's better than doing nothing just because it's not perfect doesn't mean you shouldn't do it, but you also have to be aware of the limitations. So even if you have every safety device in the world and you're going to surf an 80 foot wave, it's still not going to be safe. There's nothing to make that risk-free.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“But, you know, it is a conference where they're very thoughtful about risk and debating regulatory function and who bears the responsibility of risk when your behavior impacts other people. And, you know, it was this intellectual discussion as I've seen anywhere. And the guy who I profile, Brian Kulana, is the one who brought jet skis to big wavesurfing. And much like a lot of financial derivatives initially supposed to be insurance. But as you mentioned, you can also use them to lever up and take on more risk and take even bigger waves because anything that can reduce risk can also be flipped around to exacerbate risk.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, you know, they have this regular conference where they talk about risk, and it's like going to a pension risk conference. So though everyone's better looking. Right. Everyone's tan and blonde, right? Yeah. I was in the worst shape in the room.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“I think maybe you have to do that first big research project just has to be horrible. Right. So I was like, if I'm going to do this, I'm going to have a lot of fun, which was the other way I wanted to approach the book. So I just was like, I'm going to have all these adventures. It's an excuse to go places. I went to a risk conference for big wave surfers in Hawaii.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“It was all fun and surprising. I had a, I mean, I was afraid to write a book for a long time because my dissertation was such a horrible slog.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“You know, your mom's probably not going to read it. And I felt like everyone needs to know what's in against the gods. And that's partially what inspired this book is I wanted to take those ideas that were so resonant and I felt everyone needed to understand and make them accessible to an even broader audience.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“It's beautiful. I mean, I love everything about that book, and I also love capital ideas. I like his everything he's done. But, you know, your mom's problem.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“I love against the gods. It was my favorite book. I was actually partially inspired by that because as much as I love it, I wouldn't say everyone wants to read it. I mean, it's like, oh no, everybody.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, you want to, I say, convert it if you're thinking, except when I define risk to you and I was like, it's all the things that you can measure happening and how probable they are, that is a probability distribution. So a whole distribution of things that aren't intuitive to us. So, I mean, Partigli is sort of getting more comfortable with those concepts, but it's also when you think of probabilities converting them to frequencies.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, Pascal and all these people. So, I mean, it's not surprising that we aren't just born having this natural intuitive sense of probabilities. I mean, we both work in this area all the time, and they often don't mean that much to me either.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, and it makes a big difference because we are programmed as humans. We're not a complete supposed to be disasters with risk. Risk is something that humans have been facing as long as we've been on the earth. But probabilities are a fairly modern invention. They only really came along in the Renaissance with a lot of sort of brainy people.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I'm not a psychologist, but the research psychologist I talked to has said just something about the way our brains are programmed as frequencies just resonate with us more. We are.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, to some degree, it's also, you know, errors and how we perceive risk. I mean, I think people often insert assume there's serial correlation where there is none. So, you know, if housing prices have gone up the last 20 years, people assume they'll stay doing that. I think people also make that assumption around interest rates that, you know, they've been nothing but go down for the last 30 years. So it's quite questionable if they can keep doing that because how negative can yields get?”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“And she doesn't seem to internalize that if you want more return, that comes with something. And you know, and stocks are a great investment. They're a great way, especially in index funds, to get risk exposure cheaply and efficiently. Right. But you know, there's no guarantees.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“I think it's hard to say. I mean, the rate stock allocation really depends on an individual and where they are in their life cycle. I think people don't appreciate, a lot of people don't appreciate how risky the stock market is. Like my mother is nearing retirement and she expects her portfolio to like double every year. And I'm like, sure, but you're going to have to take on a lot of risks for that to happen.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I think, again, you do get people who get away from, you know, as I said, if they're down, there's all this evidence that people won't losers, but they'll sell winners. And, you know, that's usually not a good idea. If a stock's going down, it might probably will keep going down as opposed to, you know, why would you sell your winners and keep a loser? But that's supposed to be some version of loss aversion, people think.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, actually, I mean, my background to approach risk is from financial economics, which is the study of the stock market. I think in a lot of ways, the stock market's the perfect place to think about risk because you just have so much data. And what financial markets are doing is just finding ways to price and move risk around. So I think anyone who is in the stock market is someone who's naturally thinking about risk all the time”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Only when you're down, and this is the interesting, you know, sort of deviation from what economists normally think is when you're down, you'll take that extra risk to get back.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“They do, but the successful ones are the ones. This is what I was saying about there's evidence that as you get older and wiser, you are less prey to these behavioral issues. And I think it's John List, is this economist who studies loss aversion, how impacts behavior? Because the break-even effect is just sort of a corollary of loss aversion, which is when you're down, you're so determined to win back so you don't experience a loss, you double down and take extra risk. Risk you would have never taken if you were up.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Exactly. So, anyway, he claims to be incredibly wealthy. He only puts in $10,000 of his own money in any poker tournament. The other thing he does, so it's effectively hedging. And the other thing he does is he sort of gets this weird insurance, which is when he's in a major game and he takes the other player aside and they cut these little back deals”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Exactly, because now the stress of breaking the window is on the insurance company. I mean, you have to still go through the rigamarol of replacing it, but the financial risk is borne by someone else”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“In a specific state of the world, yeah, so it's insurance, which is if X happens, if this stock goes above the strike price, then I get something.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“So insurance is a little different. So, rather than giving upside, what you're doing is you're paying someone a fee. So you give up that amount of upside, but it's a set amount and you eliminate downside risk.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“They are. And if you draw a picture of what they mean on a graph, it's very clear. But intuitively, it's a very hard difference. So I think of hedging as you just take less risk. Basic finance world that would be of a risky asset and you have a risk free asset. So hedging is just putting more of your portfolio in the risk free asset.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“I think of hedging, and is it? This is a distinction that a lot of people don't, I think, isn't often made very clearly. In fact, I had lunch with the CEO of an insurance firm who even kept messing up insurance and hedging. So it's a very subtle but important difference.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“We get a little wiser with age. There's experience that just as well, experience really changes how you perceive risk. Like once you've seen things blow up for you a couple times, suddenly you become.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Totally, and how we are able to deal with risk and understand risk and how risk averse we are can also change over our life cycle, which makes it even more complicated. There's all this evidence about behavioral biases, but there's also evidence as people get older, those biases tend to be less prevalent”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think of risk. I think of it as an estimate of all the different things that could happen and how probable they are. It's a very technical definition”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“The most surprising thing, I mean, I know it sounds almost patronizing, and I knew they'd be smart, but I was shocked at how much I learned from them about business, about negotiation, and about risk.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“They A lot of them do. Dennis had really good financial planners coming in and give them very good financial literacy. I was talking to these women. Who came from households where no one had a bank account? They're like, I didn't even know what the credit score was. And then they're telling me, oh, yeah, my IRA's on index funds. You know, why pay the fees for active?”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Self employment tax. Got to cover that. And I mean, these are high earners. They're making, you know, probably at least 100 grand a year. So, I mean, a lot of them don't live in Nevada. They might have state income taxes on top of it all. So, we're talking 30 40%.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah. Especially if you just hire women online, even for escorting, which is more high-end, I think equivalent to what you get at the Bunny Ranch, it's $300 or $400 an hour”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“I'd never thought of it that way before, but that was what always on the lookout for risk. Fascinated me because I mean, the premium is large when I went, I went back to the brothel for bookwork and surveyed a lot of the women on their transactions. And then it just turned out that this economist I knew scraped all the data from the erotic review, which is Yelp for illegal sex work. So I had 1.2 million illegal sex transactions. So I had really good data.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“And therefore, then it's not adversarial, it's just hey, you know, everyone feels like they're getting what they want. I'm customizing this experience for you. So when I was there, I learned a lot about pricing, sex pricing. And something that fascinated me was how much more they could charge than the illegal market.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“I think I always saw negotiation as very adversarial. And what I learned is how to make it not so, how to just put a bunch of things out there, which apparently is a negotiation technique.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a more exaggerated vision of what we all do, right? Like we have to negotiate with someone, then we have to work with them. So, this is just that on steroids.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“And how to ask for it, how to feel comfortable, especially it's an interesting negotiation because you have to, negotiation can be very fraught. Afterward, you're going to have this very intimate encounter with this person So making that transition, which is, I mean, a more exaggerated version.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, really had a lot of good business training going on. And the women there are great businesswomen and they're proud of what they know. So once you get them talking about that, they do open up because this is a special skill a lot of them have learned. And a skill, honestly, I think most people could learn on their jobs and they don't.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“In the beginning, some were very wary, some were very open. But once you get talking to them, they open up because I think a lot of people go there and they don't really take them seriously as businesswomen. Okay.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Freak Economics was already out, but it took it to another level because I don't think Steve Levitt spent a lot of time in brothels. No, he focused.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Or a sales job on Wall Street, you know, and they're like, well, and they even said that line. The women here don't know their value, so we teach them to know their value and to ask for enough. And I was like, well, I could use that. So I talked to my editor at courts to sending me there to go through their negotiation training program.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, at first I was like, this isn't my thing. This isn't what I'm known for. I'm a retirement economist. But when they said the thing about we have a negotiation training program, which is something I struggle with too. Like”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“So I wrote this story about it. Did super well, as you can imagine. And so I got a call from the Bunny Ranch saying, if you're going to be writing about brothels, you should be writing about us. And I was like, well, I don't write about brothels, but this is an interesting call, so I'm going to continue this. And so I was talking to them and they were, I'm like, how does this all work? And they're like, well, the women come in and every, they don't set prices. They negotiate every transaction. And he kind of throwaway thing he said. And I was like, well, that's actually very interesting. So you're telling me you have women who are about 20 years old negotiating with men in their 60s over tens of thousands of dollars. He's like, yeah. And it's interesting you say that because most of them come here not knowing how to negotiate, so we have a negotiation training program.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“So I wrote a story for courts because I've always been interested in risk. Even as a journalist, after I started working with Bob, before I was a macroeconomist, I became, I learned finance. I'm like, everything I know about the economy was wrong. Risk is a much more much much m So I was applying that in sort of this freakonomics-y way as a journalist, and I wrote a story about a friend of a friend who was running an online brothel where her value ad was screening clients. This is an illegal operation. So when you work illegally, you have to screen your clients, otherwise, especially these reference submissives specifically. They get tied up. So they're particularly vulnerable. So screening has especially important premium. So she was being paid this premium to screen them. And I was like, well, this is pretty cool.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“A friend of mine who I think had him when he was doing his MBA at Harvard, because my dissertation was exactly what Bob was doing. Bob was trying to come up with financial models that took the best of defined benefit plans and put them in a defined contribution structure. And that turns out, you know, as I said, as much as I said, burn it all down, I always had a good dissertation, which... Thought about risk in a clever way. So once Bob didn't know I'd sort of hit bottom career wise, you know, it just goes to show where you feel like something can feel like it's totally blew up. I was thinking, I just really messed up here. I just wasted all this time. And then my paper ended up in front of him. And he was like, Really want to do this. He called me in. He's like, if you come work with me, I will teach you finance.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“So I was just writing web stuff for the Economist for free with an econ PhD and then someone passed my dissertation along to Bob Merton and it turned out retirement was also his main interest. He was working on market solutions to the retirement problem.”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source
“As I said, I had this hard realization when I was finishing grad school. I didn't want to be a professor. I didn't want to be a government bureaucrat. All the things you're supposed to do with an economics PhD. So I kind of had this, burn it all down, do something new attitude, which also turned out to be helpful for the book. So I was like, I'm going to do something fun. I've just spent my whole 20s while everyone else was partying, solving a math problem. So I went to the economist, unpaid because this is early days of web journalism. And they would take people who'd never written before to write for the web back then. Yeah”
2019-07-19 · Masters in Business · Allison Schrager Discusses Monetary Policy · IDENTIFIED FROM THE TRANSCRIPT · source