YouSaid · the spoken record

Bill Priest

lines on the record: 126
first: 2025-01-12
most recent: 2025-01-12
sittings or episodes: 1
sources: podcast

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“Was nurse. He's firstborn. I love firstborn. Raymond LeBruge. I can build a firmware on those people. The pressure on them to carry the family forward is just enormous. It's an enormous. And I said, well, how in the world did you ever get to Elias Burnstay? Because they aren't recruiting there. And he said, well, I was on the trading desk as a clerk. But I was a decent athlete. And this summer, I played basketball with a basketball team. And it turned out they had a small cap. Also Fund was also on a team. Took a liking to him, said he, you're a pretty smart kid. Why don't you get a CFA and help him along? And he became a member of that five-star team. And I said, so let me tell you why I think you want to come here. And he said, what do you mean? I said, well, here's why I think you want to come. Alliance Bernstein, you will be forever known as the kid who got lucky. You knew the head PM and he took you in. You come to him.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“This small cap fund we're trying to build. So, I just want to be part of building something. And it just didn't make any sense to me. So I said, well, tell me how you got there. Tell me, I like talking about families of origins. I said, tell me how you got there. Lyons Bernstein. And I promise you, Bill, I'll buy you dinner anywhere in the world heard of this college. He went to a college called Messiah College. I've never heard of Messiah College. It turns out it's in the middle of nowhere in Pennsylvania. religious school and I said well where did you grow up you said Long Island I said now how in the world does a kid from Long Island get to what I think of and I started to provoke him by saying kind of a right wing religious nutcase kind of a school and he said well it was free I had a scholarship I said oh okay and the more I talked to him I said well tell me about your family well my dad was an immigrant from Sicily I think he was a bricklayer or something like that his mother”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“Market. If you were 20, you were the office boy. If you were 60, you're getting ready to retire. But if you were 40, approximately my age, right place, right time. Sure, I worked hard, but I always had the benefit of luck, good fortune, never underestimate the value of time and place. And so, and then we passed on him. I passed on him and I was, I had the capability of doing that. And I hired another guy. And he's actually still with us today. His name is Steve Salzone. And so Steve comes in and he is leaving Alliance Bernstein. He is an analyst with a five-star small cap fund that's closed. And I can't understand why he wants to leave a quality firm like that where he doesn't have to worry about asset growth. Why do you want to come here? This is a startup. It may or may not work.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“So he arrives in my office like, you know, I got all the tickets. You know, I'd like to work here. I like the people I've met. So what do you want to talk about? That tone just irritated the hell out of me, to be honest with you. And I said, well, let's talk a little bit about time and place. And he said, what do you mean? I said, well, let's, what do you think of stock market's done over a long period of time? And he said, you know, 9% or so. I said, well, yeah, actually it's closer to 10, but nine and a half, 10% over a long period of time on average. But let's take a subset of those years. Let's take 1980 to 2000. What do you think the market did in that period? He said, well, probably a little better. And I said, well, I know the answer. It wasn't fair to challenge you with that. It's 17.6% a year for 20 years. $100,000 in 1980 became two and a half million in 2000. And he said, what's your point? I said, well, how old do you think you had to be to benefit from that wonderful?”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“Absolutely. I'm a big believer at right time, right place. In fact, I wrote him, started to write a piece for Baroness. I'll give you two examples. And it came up in hiring somebody. This was a few years ago. There was a guy that came in. I was the last person to interview me. It was going to be a pharma ambulance or something for us. And everybody came in and said, Bill, he's the best we've ever seen. You got to hire this guy. I said, yeah, but there's two candidates. Don't worry. He's not only as good as this guy. You've got to hire this guy. So I sat down with him and I started talking to him and he started to bother me. I saw that there was a bit of an arrogance in him. And he had gone to Harvard undergraduate, Columbia Business School, and Goldman Sachs.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“I testify before Congress. We changed the law. That Section 4023 was erroneous and it was either withdrawn or corrected. But that made BEA in a lot of ways. Here we were. BEA was set up for just, as you say, the world just took off. All of a sudden, these pension funds. Hundreds of millions, billions of dollars. So every year there have to be a large sum. And the professional money manager just took off at that point. But because of that book, that book gave us real credibility when we were talking to trustees of pension funds. And we built, we wound up building, I think at one point, I think at the height of BA, we were $10 billion. We really started with like $150 million, which we didn't pay anybody anything.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“And we were It was a federal No, absolutely correct. So, what happened was, the reason Arista got passed, there was a company called Studebaker, a car company, and it went broke. And Studebaker, they had a pension fund, but Studebaker had an option. They could either pay their pensioners what they owed them or just give them the pension fund and say, good luck fellows, this is all. So in other words, they might have owed you a dollar, but the pension fund only had 50 cents and they gave you the 50 cents. That situation actually led to the act itself, the employee retirement security act. But the law was flawed. There was a such an error called, I think it was Section 402.3. And that section guaranteed the stock market. Well, there's no way the government can guarantee the stock market. So Jack and I and another fellow, Pat Reagan, he wrote a book called The Financial Reality Pension Fund and ERISA.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“We both had collected model trains. So we went to train meets and whatnot. And in those travels down to the middle of nowhere, Pennsylvania sometimes, we just got to like each other. And then Arissa was passed. And Arissa was passed, I believe it was 1974. I'd have to check the date of that.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“I was an incredible period. But around that time, I also got to know Jack Traynor. And I published my first article in the financial analyst journal in 1965. And again, it was called Rate of Return, Rate of Return on Equity is a criterion for stock selection. And that was a paper. It actually won a mini award or something. It was not a big, in hindsight, it was nothing paper, really. You could do that study in 15 minutes today. But at any rate, I got all excited about it. And that's how I met Trainer. Jack Trainer was originally with Arthur D. Little as a consultant. And Jack is the single smartest financial guy I've ever met in my life. He's passed away. He's no longer alive. But he was an amazing thinker and a bit paranoid about a lot of things as well. But anyway, I got to know Jack. We both had a similar hobby.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“Said Al, I'm not even sure I'm going to get paid. You want me to take what little savings I had, which was, I think I had 50 or 60,000 dollars and invest everything into BEA. And he said, yeah, that's what I'd like you to do. I said, Al, this is every nickel I have. And it's so far this has all been downhill in this story. And I said, no, bank's going to lend me money. I'm married with two kids. My wife says, stay-at-home wife. We got a mortgage. I have no assets. He says, don't worry about it. We'll take care of it. I said, ow, how are you going to do this? It's my father's going to guarantee you love. I said, where does your father live? Just Cleveland, Ohio. I said, if he's never met me, he said, don't worry. He'll guarantee it a loan. So it turned out I needed $80,000. I bought 10% of the company for that $80,000. His father never met me, but he guaranteed the loan. And that was the beginning.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“At the time, and Gloria said, okay, what do you want me to do with these? And she has a fistful of bills. And I said, well, pay them. She said, I can't. I said, what are you talking about? I've seen the financial statements. We currently ask this, Colonel Libraries, or two to one. She's, oh, you can't believe those statements. I am now panicking. I left the state job. I married with two kids. I'm in New York. I took a pay cut. And this person is telling me we can't pay our bills. And I thought, this is a problem, Lori. I said, let me ask you another question. In two weeks, you have to pay me a check for my first half month here. I said, how are you going to pay me? She said, frankly, I have no idea. I absolutely panicked. I walked down the hall where Alzheimer's office went. I said, Al, we got a problem. And he was shocked. But he says, we'll take care of it. So he hollowed me across the street. We went to a bank, borrowed some money. And he said, but I also want you to buy stock.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“Safe job with a lot of promise and fundamental. And I'm joining this firm that was $300 million, a startup. And it turned out $150 million only paid $10,000 in fees. I didn't even have enough sense to answer. My very first day on the job, Al says to me, well, Bill, you have a CPA. I like to make you treasure. I said, Al, I want to be a securities analyst and a portfolio manager. I don't want to be treasurer. He said, yeah, but, you know, you've got a CPA and we need a treasure. And I said, well, what do I have to do? Well, you have one person reporting to you, and her name was Gloria Lee. And I said, what's she doing? Well, she's our bookkeeper. I said, well, do I have to do anything here? And he says, no, no, she'll just report to you. And I said, all right, that was done. He leaves the room. And next thing I know, Gloria walks in and she says, Mr. Priest. And Gloria is like 50, and I'm like 30 or 31.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“Research. I said, guys, I'm only 29 years old. Do you want to make me director of research? I don't know about managing people or whatnot. And they said, well, you understand quant. And I said, look, what I understand about quant, maybe more than what you do, but it's nothing what quantitative capability really is. And I left there. I took a job cut from working in Elizabeth, New Jersey, which is where fundamental investors headquarters were. to a job in New York City where I paid more taxes for less money. And that was in 1972. But I got to own part of the company. And this Alzheiger, who has controlled, and it was just really a small, he had 300 million dollars. I can tell you a lot of anecdotes about it, but even my first day in a job was just frankly amazing. Al talked me into joining him. Everybody said I was an idiot. I had this secure.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“And at that point, the guy that hired me had come east and he worked for a firm called Anchor Corporation, which ran fundamental investors, which at the time was a $1.5 to $2 billion mutual fund. And that was enormous in those days. And so he wanted me to join him. And I subsequently did. But I also had a good mentor. Mentors really matter when you're young. And the mentor that I had, not only was Alzheziger, was my guy who recruited me to go out there, but there was another individual there who said when the acquisition took place. He said, you need to learn about the industry and you're not going to learn about it out here. You've got to go to New York. And he gave me great advice. I took the job and moved back to the New York area and I worked at the fundamental investors from 1966 to 1972. And they liked me a great deal at Fundamental. They wanted to make me direct.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“And there was a guy on the West Coast who I just had resumes out blindly to these people because no one recruited. There were no institutions of money managers that recruited at Wharton with one or two exceptions. You had the brokerage firms that they wanted you to be a broker or investment banker or what I just wanted to be a security salist. And so I sent resumes out and this guy from California was in the city or was in New York and I went up and met him and he hired me and I went out to the Commonwealth Group of Mutual Funds. I was only there, I'm thinking now, almost”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“What in the world is that? So I said, it's analyzing securities and forecasting balance sheets, income statements, and trying to see if they're good investments. And I had written my thesis at Warden back then you had to have a thesis to get your master's degree. And I'd done a thesis on the drug industry. And it was, and again, it was an interesting thesis that the title of it was the ethical drug industry, which is another word for prescription drug industry. Prescription drug industry is commonly called the ethical drug industry. And I said the ethical drug industry, the last of the robber barons. And then I went through that financials of how profitable they were for the services they provide. I probably would have been a good prosecutor, to be honest with you when you look at what went on. But at any rate, I found it fascinating. And this whole idea of security analysis leading to opinions on stocks.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“So that was an acronym for basic economic appraisals. Well, let me lead up to that when my first job as an analyst was in San Francisco with a mutual fund group called the Commonwealth Group of Mutual Funds. And at the time, it was the lowest offer compensation-wise I had. I graduated near the top of my class award, and I had all kinds of offers. And back in those days, a big offer was five figures. So if you were offered $11,000 a year or $12,000 a year, that was astronomical. I turned all those down and I took this job in San Francisco where I knew absolutely nobody. And I was married at the time for $7,500. And my father was irate. He said, are you kidding me? You turned down all these offers and you, I said, I wanted to be a security analyst.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“So, when I went there, I was there for seven months. They gave me all kinds of interesting jobs. I got in the management consulting. I built a cost system for a contractor in the Middle East. I spent eight weeks in New York pretty much staying in a crappy hotel with a hole in the bed spread. And I had a manager and we built this cost system. And I'm thinking, this is pretty cool. At this point, I was 20, I'd be 23 years old when I was working with this guy. And they tried to convince me to stay in the consulting part of the library. I said, no, I want to go onto the stock market. I went to refinance and research. And they said, okay, I'll come back. I'll finish that evolution in a minute. But when I got to actually be in charge of a company, I hired librarian as the auditor. I paid him back for how they treated me.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“I mean, it was head down, get the best grades you can. I got into a lot of business schools. I picked Wharton because they gave me credit. I was absent from all accounting courses because I passed the exam. So I was able to get out of Wharton in three semesters, not four. And then this fourth semester, I actually worked for Cooper's a library, and I told them the truth. I think the truth is always the best answer. We can shade it sometimes, but it's keeping up with falsehoods just usually gets you in trouble. And I told Cooper's a live brand, look, I only want to stay long enough to finish my work requirements so I can get my certificate. I needed seven months in addition to the summers I had. And I told that to all the accounting firms. And no one would hire me because they didn't want me coming and leaving after seven months. But Cooper's in the library did. And they said, we're going to change your mind.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“My past exam when I was a senior at Duke, and I thought, well, that's pretty good. And then I had a couple of summer jobs lined up. And if you had an MBA, you could take one year of experience. And by 23, I had my CPI certificate. So I'd gone through Warden. I was a very good student warden. In fact, it shows my ignorance. I still think I'm pretty ignorant. But I remember being asked if I want to join a fraternity. And I said, no, I have no interest in joining a fraternity. Well, you should join this one. I said, What is it? It was beta gamma sigma. I said, I never heard of that fraternity. Well, it turns out it's an honorary for fraternity. It's for students that achieve a certain academic level and whatnot. So I said, well, what does it mean? Well, you got to come to this dinner and then you get to join, then you can join. And I said, does it cost me any money? No. So at any rate, that was, I mean, I had to be one of the most naive people right through age 22 or 30.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“Now, that's a nerd. Let me tell you, that is a nerd. I must have collected by the time I was 24, 25, I literally had hundreds of annual reports that I would peruse, collect the whatnot, like people collect baseball cards. I collected an annual reports. Kind of silly when you look back on it, but that's what I did. But I did really well in that course. And that course kind of set me on my way. I also was an accounting major and a political science major simultaneously there, but it turns out I passed my CPA exam when I was in college, which is unusual most of the time getting taken in college. But the way the CPA exam works, exam itself is the same. It's a nationwide exam, but some of the when you can take it and some of the rules regarding experience vary from state to state.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“But that also taught me don't start spending money in areas you don't know anything about. And I really didn't do much with stocks until I got into at Duke a little bit. But even there, I took an investments course when I was a junior at Duke. And I was so excited about it. I loved it. I just loved the whole concept of how economics and finance come together and how the value companies. But again, it was from an accounting framework, not so much a financial framework. And I'll explain that in a minute. But I am so excited that when it came time, my junior year for spring break, I didn't leave. I spent the entire spring break in the library writing a paper on Standard Oil of California. I wrote a thesis, a study. I had to write a paper, but it was all about standard, California, what they did, how they earned their money or whatnot. And I got in the habit, believe it or not, of collecting annual reports.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“Well, not so much in the high school days, but there was one book in high school that I read called How to Get Rich at a Stock Market. And I told my dad, this sounds a lot easier than forcing me to cut the grass and cut the hedges and do all these jerseys he had for me. And he said, well, he said, you can't buy stocks. You're too young. But he said, if you want to buy something, you tell me what you want to buy and I'll do it through my broker. He invested a little bit in the stock market. But it was more like individual securities. There weren't mutual funds. He wasn't involved in that world at all. And I just remember saying, okay, Dad, I want to buy this company called Hudson Vitamin Products. And I can't remember too much about it other than I lost almost half my money on it. And so it was recommended in the...”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“But it was also a very positive one in the sense that family mattered, you supported family no matter what, no family is perfect. And whenever there was an issue, my parents were always there to be supportive of me or my sisters. They were remarkable in a crisis, just remarkable. I was in two automobile accidents before I graduated high school, none of which were mindful, but the way my parents performed in those times, it was amazing. It was just an amazingly supportive period.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“It was a pretty good student. I wound up going to Duke University as an undergrad, and later Wharton, we can talk about that. But growing up, my dad always stressed the fact that you don't get something for nothing. If you want your allowance, which at one point was 80 cents a week, which was a lot of money for me at that time, I had chores. I had to cut the grass. We had some hedges I had to trim. And I always had to earn my allowance. Now, even in those days, I would say the work ethic was valued. And I've had a W2 since I was 16 years old. There wasn't a summer that went by that I didn't have a job. In fact, my peer boo used to think of people who weren't working as being lazy, good for nothings. It was an amazing group of people at a time very narrow with hindsight. But we're talking about the mid-50s, and I graduated high school in 1950.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT
“Actually, I always enjoy talking to people when I when I interview people, I always ask them exactly where you're started. Tell me about your family origin, your parents, your siblings, or whatnot, because it does shape who you are. I was actually born in Pittsburgh, which is 40 miles away from Steven Velt, with my parents were unusual. My father was more or less an orphan. His siblings and parents had died by the time he was 12 or 14 years old, and he only had a sixth grade education. My mother, on the other hand, had a college education. She graduated from the University of Pittsburgh, and she was a school teacher. I'm still not sure how these two got together. But at any rate, they got together. We grew up in Sturill, Ohio. My dad worked in the steel mill. He had a white-collar job there at the time. And it was a wonderful place to grow up at that time. Well, later perhaps we can get into kind of what's changed there versus now. It gets into some other economic and political issues. But I grew up there, went to public school.”
2025-01-12 · We Study Billionaires · RWH053: Trouble Ahead w/ Bill Priest · IDENTIFIED FROM THE TRANSCRIPT