YouSaid · the spoken record

Aswath Damodaran

lines on the record: 198
first: 2023-04-06
most recent: 2023-04-06
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

“So, in my book on the corporate life cycle, one of the things I talk about are companies that go through rebirths. It's really difficult to do. And I talk about what they share in common. And one of the things I see is, A, this willingness to be patient and build on internal strengths rather than B in a hurry and do an acquisition to enter business. But even within Microsoft, this is the reason I'm less optimistic about Activision doing well for Microsoft as I was about Microsoft's original cloud entry.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“And we're going to build it because we have some strengths. We have people who know software really well. We're going to take those strengths. We're going to be patient and we're going to act like this is again a standalone business. Don't worry about the effect on office and Windows or what you're doing.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“And when he entered the cloud business, first thing he did was he said, We're not going to quarrel our way into this business. That's not the way to grow because we're going to be throwing a lot of money in there.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“But he gave the team the freedom to make decisions, but he built on the strengths of Apple at the same time. He said, don't be a startup act that's a stranger to the company. Draw on the resource of the company, but make decisions as if you're a startup. Satya Nadella did the same thing at Microsoft. He came in because this was a company with two hits office and Windows that had never done another thing in their entire corporate life.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think that I'm glad you brought up Apple because I think of all the things Steve Jobs did that made the kind of rebirth of Apple possible. The first was on the original iTunes disruption, he told the team, and this is, I think, well documented, act like you're a startup. Don't worry about legacy effects. Don't worry about what the rest of the company thinks, because they're still thinking our business is computers. Because you can almost see the discussion with Apple. Why are we wasting our time on this distraction? We should be building a better Mac. And trying to get back into the PC business. No, Steve Jobs saw the writing on the wall that the PC business was not going to be the future, that if you fought Microsoft in the PC business, you'd have the same result you had in the previous decade. You're going to continue to lose.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“They're taking advantage of inertia, which is if banks are charging $25, let's create a Venmall. And essentially, that's exactly why I think these status quo institutions are not going to be able to partake in the disruption that's coming, is they can see it coming. They will say all the right things, but within the organization, there's such stickiness and inertia that their decisions are still driven by the way things used to be, not the way things are right.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“Out there, but it's very difficult to create change. And this is the old Clayton Christensen argument for why institutions have trouble. The status quo has trouble with disruption. Is he of too many legacy effects? So it's almost you can see the person at JP Morgan Jay saying, hey, we should stop charging for these wires because people are going to use alternate ways of transferring money. And somebody says, but we make $150 million from the wires. We can't do that. That's a legacy affecting. So, guess what happens? You essentially take your softest businesses and they get disrupted. I mean, let's face it, most fintech companies should not exist. Because they're either solving problems that are not problems in the first place, or they're doing regulatory arbitrage. They're bypassing what would normally be regulated.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“They're going to pirate the book. Now, I've heard people, there are people who bought my book for $2 outside a train station in India because they get the pirated version. And I said, would you rather cannibalize yourself and get a reasonable price, or would you rather have this Chinese, you know, The pirated version cannibalize you and get nothing for it. But that didn't change the decision. And this is the nature of how decision making is at universities, publishing, and banks. Is there still the decision making is driven by a world that's no longer real.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“Do this or not, they said, Do you think the cannibalization is going to stop just because you did this? Because you know exactly what's going to happen. Indians are not going to pay $100 a buck. Some person in India or China is going to buy one of the US books. They're going to copy every page.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“They said there are some people in the US who are buying the Indian edition. How many? And I said, okay, how many? And they said, we don't know, but we do know there's cannibalization going on. I said, let me get this straight.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“Might do editions and I have an Indian edition, which is printed on cheaper paper and priced at one fifth the price because Indians can't afford to pay the equivalent of $100. And India is the largest market for me outside the US because the big English speaking population, lots of students. So I get a call from a publisher and they say we've decided to suspend your Indian edition. And I said, why? They said there's cannibalization going on. And I said, What are you talking about?”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“And I'll give you an example. One of my publishers, I won't name them, call me last year and they said because my books have an”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“That's not right. And so maybe when I deliver money to others, I can get around the bank. When money comes to me, I have no control over the process. So let's say I'm getting $5,000. This is what I see from JP Morgan Chase. I see $4,975 put into my account. And a wire service fee of $25. What? This is what I mean about these businesses acting like it's 1985 still. Take the publishing business.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“But when I get a wire from outside, I can't tell them what to do. So they take their bank and they wire money to JPMorgan.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“And here's my question. So, why does JP Morgan chase every time I get a wire still take $15 off that wire? It just makes, this is my problem, right? You can ace.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“So the post I did on Tesla a couple of months ago. I valued Tesla and asked, you know, how do you explain what's happening at Tesla? And how do you bring in these new businesses? That becomes a part of my class somewhere. So I tell people, look, start with the 10 minute session. That's a realistic estimate. You can actually get through the sessions. And if this truly interests you, then try out the, so I create these concentric circles for people who have time and say if you have this much time, try these extra things. If this much time, go the extra mile. So I think by creating enough flexibility, you're going to be able to allow people to do things online that they can't do right now.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“And it's a lot more. I can tell stories, I can flesh that out. So I'm not saying the extra 80 minutes are useless, but I'm saying that 10 minutes is where you get the substance, the extra 80 minutes are where you get the dressing on the substance. And you could probably get that dressing in small pieces if you want because when I do my YouTube videos, essentially you're seeing blog posts, you're essentially seeing things that will show up as riffs in my class.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“And the scary thing was it wasn't that difficult, which tells you a little bit about how much buffer as faculty members or as professors you get.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“It's huge. It's 90% because people have lives to live. My class requires a lot of time and resources. Sure. And it's 80 minute sessions. Even if you just watch the lectures, that's three hours every week of just watching the lectures. Forget about the other stuff. So that's why I created an online version of my class where I take my 80 minute lecture and I think about how would I deliver that lecture if I had only 10 minutes.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“And I start the classes off about fifty thousand people start the class with me. I can watch them by session because I go 26 sessions. And by the time I get to session 26, I can actually track how many of the 50,000 are still there.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“These are called hybrid models, and a lot of universities have adopted them, not just for undergraduate degrees, but for executive programs. Executive programs historically been very expensive to go to. But you create these hybrid programs, you take classes online, but one week a year, everybody in the program is brought into a physical location so they can hang out together, live in the same place. That's a networking benefit. So you are going to see hybrid programs and that's going to be the transitional point because doing an education entirely online is tough to do because people lack self-discipline. I know I offer my classes online.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“For them, this was actually good. I was taking this thing that they did not like to do. I was doing it for them and I was doing it with joy because this is what I do. So it serves as both. I don't begrudge them, their research, they don't begrudge me my teaching. We've learned to live at least at NYU. And part of the reason I like being at NYU is it's a very large faculty. It's a very diverse faculty. So I've always been allowed to do what I want to do. Could I have done what I did at a University of Chicago or Stanford? Probably not. And I think that that basically means that if your joy is teaching and you want to be in academia because you want to teach, you want to pick a place where that's not just valued, but that you get the freedom to be able to focus on teaching and getting a message out to practitioners.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“And for some people, they still have enjoyed doing research. I don't begrudge them that. So there are some of my colleagues who are still curious about academic questions. But I discovered very early in my life that this wasn't my strength, picking some obscure academic topics, spending six months of my life writing a paper that dotted eyes and cross T's. I'm a teacher, and I want the biggest audience I can. So I think of everything I do as an extension of teaching, including almost all of my writing. And I want the biggest audience I can, so why would I restrict my audience to just people in my classroom or just people in an echo chamber? So it's very selfish. I want to reach the biggest audience because as a teacher, you want the biggest audience. And this gives me a way of making the audience larger.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“But even if you have questions, because we really still don't know how the universe is created, the only problem is we write a paper on it, it's too big to get published because there'll always be loose sense. People are going to pick up the loosest budget. This can't be published. It's not quite ready to be published. So as disciplines age, unfortunately, the research becomes less and less useful to not just the outside world, but even the inside world.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“You have to start to ask smaller and smaller questions to be able to get published. And let's take the example of physics 100 years ago. Amore, Einstein bore asking the big questions How does the universe get created? What drives it? Today we look at a physics journal, they're asking questions you don't even understand the title of the paper because it's such a small question. There are seven co-authors. That's the other thing that seems to happen as disciplines age is you use this power of numbers, one of whom might have connections to a reviewer so you add them on. And they're asking questions, to be quite honest, nobody cares about, including physicists, because the question is so narrowly phrased that you say, who really cares?”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“I think there's a degree of hypocrisy there, right? Because I did get tenure and it was based upon papers that I don't even remember what I wrote them on, right? I mean, that tells you a little bit about what academic research is about. As a disciplinist, and this is, I think, key.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, we've been trained. It takes four years. You go to university, there's a degree that comes with this, and there's a screening process that goes with it. So I think the reason disruption has been so slow to come to education is because the people who make the decisions on education, which still are the parents, not the kids, have been trained to believe that you have to go to university, go for four years to get a degree. But that's going to change.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“Unbundling basically then makes it transparent that you're charging this hefty premium. The only thing universities have going for them that's going to make disruption slow is parents. I mean, if you're 18 year old came to you and said, look, I can educate myself by taking all these courses online. Most parents are probably still going to say that's not education. You've got to, because we've been trained.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“People are going to be able to buy the network. LinkedIn is in fact a very good substitute for going to a college and spending four years hanging out with people who might never get back to you when you try to reach out to them. So essentially what technology is doing is it's unbundling the university model. And over time, it's going to eat away at the university model. Universities are actually contributing to their own disruption. Georgia Tech, for instance, allows you to take courses for a fee. It does a very good job. And it's a good revenue generator, but you're already digging a hole for your own demise as a university because once you start unbundling courses and offering them, people can start pricing them out. I'm paying for five courses in an MBA. I'm paying $50,000, but you're offering the same five courses online for $2,000 apiece, five times $2,000 is $10,000. So what's the extra?”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“So, I think, in a sense, you're buying a package. It's like the old cable model. You bought this package. It's going to cost you $50,000 a year. And because you couldn't untangle the different pieces, you paid because you had no choice. I do a session called Barbarians at the Gate for universities. I said, look, just as the cable companies ended up with this unbundling of the product where people said, you know what, I can just get the channels I want by paying directly for them and that kind of untangled the cable business untangling is coming to the education business”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“And most of all, its parents sending their kids off to a place where they can do stupid things for four years and not get into too much trouble. I mean, let's face it, especially if you have a child the age of 18 to 22, you know they're going to do stupid things. This is peak stupidity in age. That's the purpose of combating. And you send them off to a nice college campus. They can do stupid things on campus and the college kind of covers up for that stupidity.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“If you were just paying for an education, it should be one tenth of that. And I think that of course university education is not just courses. That was the mistake that edX and Coursera made when they first decided they were going to disrupt the education business. by packaging these MOOCs remember the big online courses were supposed to change education it never quite got on because an education is a collection of things it's the courses you take it's the network you create it's the entertainment value let's say you go to notre dame that's sunday football is a big part of your life right”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“The landed gentry. And if you think about how much it costs to pay a faculty member who works four and a half hours a week, then you can very quickly start to untangle why it costs a student $50,000 a year to go through as tuition. So you're employing.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“That is life. That's it. And once you're, I know you're supposed to keep the extra time for research, but once you're tenured, there's no. You're landed.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“And because of that, universities do things where an outsider looks at university and says, How the heck do you guys get away with this? And I'm going to give away a secret as a professor to research university, my teaching load is three courses a year. That translates into four and a half hours a week for 30 weeks a year.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“But if you're a research university, the mission is muddled and the mission is muddled because you then get, you know, you get measured on the reputation of your faculty with their peer group and what kind of research they do. And I tell people, if you think about the constituencies or universities serves, you'd expect undergraduate students to be at the top of the list, especially university-like NYU, where our money primarily comes from tuition. These are your customers, right? But if you actually look at decisions made at a university and you look at where undergraduate students fall on that list, they're not even on that list. At the top of the list are tenured facult I mean, I describe universities as lunatic asylums where the inmates run the asylum.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm often asked what I do for a living, and I say, I'm a teacher. That's my passion. It's not valuation, it's not corporate finance. I'm a teacher first and foremost. I tell people if I wasn't teaching valuation in corporate finance, I'd be teaching high school algebra. Teaching is my passion. Corporate finance and valuation are the things that I use to kind of exploit that passion. And that puts me at odds with traditional academia because unfortunately I think education universities have lost their core mission. To me, the core mission of a university should be educating the students to go through.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“Because chatbots are going to just reflect human behavior. That's why I'm not so upbeat about chatbots doing the right thing. They're going to mimic human behavior. And guess what? Humans behave in some really bad ways, especially during crises. So chat box are going to just magnify that process. If you think this is going to make us more rational, it's not. In fact, you have to create a counter chat bot that says, tell me what I should be doing, and then I'll do the exact opposite.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“By discounted quality. But you have capital that doesn't panic. It's driven by the actuarial tables. You can go out and take positions in these companies and say, I don't have to worry about my clients asking me tough questions because my clients are the actuarial tables. The question is, if he can do it with insurance company money, why can't all state and state farm and other insurance companies do the same thing?”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“It doesn't panic That's a huge plus, right? So when he bought Goldman Sachs in November of 2008 and Bank of America in November in 2008, I thought about a traditional portfolio manager doing the same thing and trying to explain to their clients what they just said.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“As everybody else does. And in fact, let's use Berkshire Hat the way to illustrate how a niche can be exploited well. To me, one of the reasons Warren Buffett succeeded. He has a lot of good qualities brought in, and one of the reasons he succeeded is the money he was investing. I mean, if you think about the money he was investing, he's investing insurance company premiums that are collected, right?”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, they tried to be clever. The promise momentum is such a strong force that everybody chases it, right? They're not going for the stocks. They should go for given the niche. Properties. They go for stocks that everybody else is buying.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“So, if they're by dividend paying stocks, they should be able to earn higher returns on a post tax basis because their taxes are zero, right?”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“Take some alpha away. Or it could be some unique characteristic pension funds, pay no taxes. That should give them an advantage subsets of the market”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“You're not finding anything particularly valuable. So, why? I mean, in investing, you've got to bring something to the table. To take something away. That's my view.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“And I can almost get arbitrage away. If it really exists, get arbitrage away. So to begin with, everybody knows what the open R's to the market are. This is no secret information.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“I think it's nonsense. Nonsense. It's nonsense. I mean, my argument when I look at NETF and Asset is their value is if everybody can do it.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“It's misconstrued. I think it actually ends up doing more damage than good when it goes into practice. I'd much rather that practitioners never read academic research and try to put into practice because in the process of putting into practice, they just ruin it.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“So I think this is one of those cases with the academic research weird off in one direction, but the practitioners using the research found ways of making money on it And in the process, it's taken on a form that none of the academics who might have done the original research would even recognize. So I think that it's not that research takes a long time to go into practice. I could live with that. It's the way it gets skewed and it's worse than delay.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source
“And at that point, he's saying, what's a small capguard to do with anything? I would argue that if you did a quality effect across the board, you're probably going to find a quality effect in large cap stocks and mid-cap stocks.”
2023-04-06 · Masters in Business · Aswath Damodaran on the Future of Business Education · IDENTIFIED FROM THE TRANSCRIPT · source