YouSaid · the spoken record

Charlie Ellis

lines on the record: 100
first: 2015-03-28
most recent: 2015-03-28
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

“Well, there are a couple of things that made us different. We only did things in the financial services world and only at the institutional level, no retail work of any kind. The second is as consultants, we did all of our own homework ourselves as principals and then went up and offered our service, which is, here are some extraordinary, undeniably accurate data, because we have just interviewed a thousand of your most important customers. And they really know what they're talking about, and they're talking about you and your competition on 30, 40, 50 different specific variables. So if you really want to know how you're doing, this is the best source of information you've ever had, and it's undeniable data. And then secondly, we had bankers who worked with the banking clients, investment managers who worked with the investment management clients, people out of the brokerage business worked with the brokerage clients, people out of the bond business, worked with the bond clients. So all around the world, we had a combination of undeniable data and very skilled, competent consultants who really knew the business.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It was fabulous fun. A bunch of very bright guys pulled together. Honestly, we didn't know an awful lot about the securities business, but we were learning and we were involved in the front edge of research being important. And we were involved in the front edge of active investment management being important. And all of those things were working very much to our benefit and interest because we were there first, because we brought some very bright and capable people together, and we had a wonderful time because we enjoyed each other so very much.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“What they've done, which I think is terrific, is they've kept the cultural commitments. And even though it's in trading and transactional businesses, they're working their way, have been working their way back towards the values that have to do with client relationships. They'll never be able to be clients because a counterparty in a trade can't be a client, but can be a customer, and you can watch out to be sure that you treat them with respect and consideration. They would welcome you back, and they have done a terrific job at that. They've also done some terrific things in terms of public perception.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, trading is trading is trading. And if your business is dominated, 90% of the firm's profitability comes from trading in currencies, trading in commodities, trading in bonds, trading in stocks. It's all trading, trading, trading, usually at risk. And that makes for a very different kind of a business than when it's a relationship-based business and it's you as a client that determines whether I get to do business or not, then I have to serve your needs in order to serve my needs. That's a very different business.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“There may be a transactional relationship, but it's not an important factor in who's going to do the business next time. And if I beat the Dickens out of you. And really exploit you. That's my win. You don't even know what has happened.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Trading. I am in the market. I'm secret. Nobody knows I'm there. I decide to do something. Nobody knows it was me that did it. My transaction time might be two or three minutes, it might be twenty or thirty minutes. It is never twenty years. It's never a year. It's never even a week. It's all very, very fast and invisible, and nobody knows when I've left. Nobody knows whether it worked or didn't work. There's no record. Except in my office and yours”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Even though the business environment and the business to be done has been changed hugely. Give you a simple example. If you go back 25 years ago, 90% of all the business that was done at Goldman Sachs was a relationship-based business. Were you as a portfolio manager and not as an institutional salesman would work together every day for 20 years, or you're a chief financial officer of major corporation and I'm an investment banker, we'd work together. I'd have people working with me. You'd have people working with you, but we were team captains back and forth. Then we would work together for 10, 15, 20, 25 years. And everybody knew what we were doing. It was all visible.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, when you say change the culture, I agree with you, but I say it a little differently. It's a tweet. Bring the culture back towards where it was.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“But it was way too clever, and if I had been an editor, I said, absolutely not. That's not going to go in print. But they did deserve part of it. And this second thing is they've reacted in a way that makes me so very appreciative of what they're really all about.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Reputation. Second, they've got a terrific interest in their own firm. They really, really enjoy the history. And third, the history is so enjoyable. So I had the privilege of interviewing three hundred different people for that book. I would be glad to go back into it all over again. It was so much fun.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Understanding markets doesn't make very much difference at all, except in general you should know that markets fluctuate and the fluctuations can be huge and they can cause very real excitement on the upside and they can cause terrible fear on the downside. So you've got to get used to that sort of thing and be prepared for it because it will happen over and over and over again. You sort of stuck with that, but you better learn what that's all about.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Will financial planning, there's nothing wrong with that. Aggressive trading might be what you'd call the price discovery. Investing is sort of an in-between, could be used by both groups.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And the skills and ambitions and drive and skill of price discovery took off like a skyrocket. Gradually it got to the point where it's so damn good that there's almost no point in anybody trying to do better than the crowd is already doing. Value discovery, however, got ignored, and there's always a terrific opportunity to get it really right for the long term for any investor by thinking through and working through value discovery. What are you trying to accomplish?”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, there are two things that are part and parcel of the investment management. Number one is what I call price discovery, figuring out what price should each individual stock be and what price it should be compares to every other stock. So comparative pricing, getting that really figured out. That's really complicated, difficult work. The second is value discovery, finding out for each client what are they really trying to accomplish? What's important to them? And that's not terribly difficult to figure out, but you have to do it one at a time for a very simple reason. Every investor is different. And if you get it really right for any investor, that isn't quite exactly right for any other investor. So discovery of values, aspirations, what are you trying to accomplish is unique for each individual client. Now take the two parts. It used to be years ago that they were blended together at a moderate fee and it worked out quite well. Then we got excited about price discovery.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I wouldn't go quite that far, but I would say that the few professionals who are out there and were young and ambitious and worked hard could find a way that they could do better than most other institutions and do better than most individuals. And you could see who they were. It was advertised in the newspapers. It was storied and written up in articles. It was not all that tricky.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“That a book about trading on Wall Street and investment management contemporaries could be a best seller nationwide for a couple of years. Tells you a lot, it was an exciting game and everybody was interested in it. And in those days, active management was a damn good idea because the competition was individuals who were not experienced and institutions that were sluggish, slow, and moved like behemoths. So it wasn't all that hard to dance around them and be faster. Quicker, better informed, and therefore able to get a better rate of return.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, the right answer for reading and understanding it is read Jerry Goodman's or Adam Smith, as he called himself, wonderful book, The Money Game. Sure.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's like being in Lake Paradise with 99% of the kids are not allowed to play because only the top 1% are allowed to play and they're terrific”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, that's for the rational observer, yes, but all of us believe there's some one way or another we're going to get out in front, we're going to do better. We've all grown up learning from our parents, from our school teachers, from our friends. Try harder, you'll do better. Try harder, you'll do better. Try harder, you'll do better. So we've sort of programmed in ourselves to try harder. And most of the time, that's right. It works. We do better.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“But huge numbers of people will do clearly worse. And on average, everybody will be doing worse. And here's the hard part. There is no way to identify who is going to do better before the game begins.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“That levels of playing field in a big, big way. And third, everybody's got access to all the same people using the internet. Instantaneous equal. So pretty soon you've realized, wait a minute, wait a minute, everybody's going to the same schools. Everybody's smart. Everybody's got the same tools. Everybody's going out to compete with everybody else. Isn't it going to be awfully hard to be noticeably clearly, decisively better than the other guys in order to do better than the market? And the answers, yeah, you're going to be awfully damn good. Will anybody be able to do it? Sure. In every single year, every single decade, every single whatever small number of people will glue clearly better.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“So is everybody else getting better and better and better and better. And if you look at the realities of life, the secret to success in investment management starts with good information. Everybody gets all the same information today. The SEC requires any companies, any information anybody has to give it to everybody at the same time. You can use Twitter if you want to, but you've got to get it to everybody. levels the playing field then everybody's got”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“The smartest people I've ever known have one way or another figured out that investment management is interesting, fascinating, fun, exciting even, and it pays really, really well. And you get to hang out with people who are really smart, and you get to compete. And all people who are really smart like to be winners in competitions. So you get this terrific crowd of people coming out to compete with each other. And the more they compete, the better they get, the more skillful, the more tools, the more information, the more access that they all get, the better and better and better they get. Only one problem”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, it's the same reason really smart lawyers have a tough time winning all their cases. My brother's as good a litigator as you will find in the field of law. He wins about half. And he asked me once, why do you suppose I win about half? I said, It's easy. The other guys know you're terrific, so they get as many lawyers as they need to come in and tie you”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's like going to see Ringling Brothers in Barnum and Bailey Circus, the guys who do the acrobatics, the guys who do the high wire, they are unbelievably good and it's thrilling to watch. Don't do that at home.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, if you're entirely rational, that is, in fact, irrational because the world is made up of human beings and they make judgments as human beings do. So don't be too smart. It is probably a good idea. But that was a different group than the more recent managers.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Secret to success in life is be sure you pick the competition that you can beat. Be brilliant yourself. There you go. The Harvard story is more complicated than that. I think all of us in the world of investing know that Jane Mendillo did a fabulous job with an unbelievably bad hand dealt her. And she did it with grace. Nice combination.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Actually, that's quite true. Although Harvard's close, Princeton's close, Stanford is close, MIT is close, there's several other places that are pretty close in what they're doing.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Did a swap on interest rates between IBM and the World Bank, he's very competitive guy. Watch him on a softball field you'd think the world was absolutely determined its whole future on whether people are going to get hits or not. Watch him playing squash or tennis, same thing all over again. 30 is one of the nicest people in the face of the earth. There are more people that would like to do something to say thank you, David, than any other person. I know, except perhaps Warren Buffett, who's got an even larger following and for good reason, very good reason. David is creative. He's tightly disciplined. He is a team player and one of the best team captains there's ever been a number of people who have trained under David and gone on to manage other endowments, really understanding what the secrets are has been just terrific. And he's also written the best book ever written on institutional investing.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Reputation So many different things combined. Number one is brilliant. He's the first guy to think of even considering doing a derivative.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Year per hour. I got it. I was the chair of the investment committee, but let's be careful in terms. I didn't work with David. I worked for David. And I had the thrill of sitting in the front row.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Oh, gee, that's easy. If you're going to teach for every hour you're in the classroom teaching, my experience, it takes at least 10, often 15 hours of preparation for every single hour. I'm developing a course now on how to be a successful client to be taught at the Yale School of Management. It is exciting and all that sort of stuff. But on the other hand, every weekend I sit down and start working again on getting those classes figured out what am I going to do. And I still don't know for sure what I'm going to do because you have to watch the way the class moves. And you have to go with the flow and be sure that it covers the things you really want and that it's really useful to the students.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, first of all, it was a lucky break, and secondly, I was working with a lot of people in the investment management business and talking with them all the time, and they were starting to tell me this is tough, really tough, and it's getting harder.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, but we don't notice it. We don't keep a tight score and we don't embarrass ourselves by seeing reality. So it's a little bit easier.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, there are two things that are really important. One is understand your own skill set, and the second is understand how good the competition really is. Most of us have sort of a mindset of, yeah, the friendly neighborhood doctor goes down to the brokerage office and buys 100 shares of AT&T, and that's basically what he does as an investor. That may have been true when we were all kids, and fifty years ago it was true. But to day most of the trading, ninety eight, ninety nine percent of the trading is done by professionals in half of that ninety eight or ninety nine percent is done by the 50 largest most aggressive professionals. They are tough. So you may be a pretty good amateur touch football player, but that doesn't mean you want to join the line for the NFL.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I thought about it and realized that's the way I play tennis. When Linda go off and play, we come off the court. There may be some people waiting because we've gone a little bit over our time on the court. They ask who won? And it drives me nuts because that's not fair. I was in control of that game, completely in control of it because I hit more double faults. I hit in the net more often, and I gave more layups to Linda. She's a very good athlete, so I'm not embarrassed to have lost, but I was not only the loser, I was in control of the game all the way along. You could have told after three or four points, I was going to lose.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Let me interrupt just for a second. Simon Ramo of Thompson Ramo Woldridge, he was the brilliant industrial scientist combination that really was the leader of the U.S. space program. This is some guy.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Doing it at night. There was nothing to it. You would go to the first class, then you had 15 minutes between classes, run across the street to the hamburger place where they had hamburgers on the grill, and you'd get a cold milkshake and a hot hamburger and mix them together as you chewed quickly and then run back to class again.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Are you a regular student or a special student? I sorry, I'm sorry, I don't know which is. I just wanted to sign up for some courses. Where'd you last go to school? I said, just finished Harvard Business School. Ooh, Harvard Business School. That's exciting. You should be in our doctoral program. My sister and brother are always getting higher grades than I was, so I figured I'll sign up for a doctoral program. They never signed up for a doctoral program. I didn't take it seriously. Was there any difference in price? No, it's the same price. So I signed up for a doctoral program in 14 years drifted through finally finishing it up. Great experience.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, it was an accident. I got in. I'd been in the Army, so I knew what you do when you see a line, get in the line. And when I got to the front, this really attractive young woman looked up from a card table and said, you're next.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“J Richardson Dilworth and was not the mayor of Philadelphia, same name, but an absolutely wonderful man. So that was one particularly part of it. The second part is I turned in my first research report, and my immediate supervisor came over to my office and said, Cholly, Cholly. Didn't choose to go to the Havard Business School. I said, Yes, Phil, I did. Why are you asking? He said, Because Charlie, didn't they teach you nothing about investing? And I said, no, Phil, actually, there's only one course on investing, and it's so boring and dull and terrible while it's taught between 11. Charlie said, This is a very wealthy family, but they ain't that rich, they can't afford you, so you better go to night school and learn something.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It was terrific in a couple of ways. It might take you by surprise. First of all, I was working for an absolutely wonderful human being, and he set a role model as to how high is up. And I realized, whoa, it's really high. If you really want to be at the high end of the spectrum, that's how good you've got to be at whatever you're doing.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It wasn't the foundation, took half an hour of the interview for me to figure out the talking about something else. This guy that's interviewing me is such a good guy. I want to work for him, for sure. I got to figure out what he's doing.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Just lucky, and it's a string of good luck. While I was at WGBH, wonderful woman who was my age and was a volunteer caught my eye. And I said, geez, I'd really like to get to know her. So I asked her for lunch. And then we talked more and more. We started really pretty serious dating. And we're still friends today. And she said to me one day, you know, Charlie, you should go to the B school. And I said, what is a B school? She said, a business school, for goodness sake. I said, when you say the B school, is there only one? She said, no, there are a bunch of them, but there's only one that you really ought to take seriously, and that's the Harvard Business School. So I applied and I got in. And then while I was there, of course, you're supposed to get a job, and I didn't have a job. So I said to one of my friends, no, I don't have a job yet. He said, I've got something you might want to consider. My dad's got a friend who's looking for somebody. I'm not sure what it is. I think it's the Rockefeller Foundation. And I was interested in philanthropic work. I thought that might be interesting.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, parts of it should be a profession. For an example, investment banking should be a profession. Investment management most definitely should be a profession. Investment analysis is a profession if it's played well and it should be run as a profession. But trading is not really a profession. And you ought to recognize that trading is a business. And what's happened in Wall Street over the last 20 years is trading has become the dominant business for everybody. And so everybody is whether they like it or not in business. It's sort of like winter weather, whether you like it or not. It's coming. It's there. You better button up, right?”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And the third thing is Dad said, you know, the law which I have loved is shifting from being a profession to being a business. And if you're going to go into a business, the least you can do is go into a real business instead of struggling with a shift from profession to law. Why don't you go into business? You've got an appetite for working with other people and you like to be a leader in organizations. I think you'd be happier with that.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I can learn things, but I'm not what you'd call a real scholar. So I'm not going to have the private satisfaction. Second thing is enormous number of people went through law school and the GI bill after the Second World War and they were coming into practice and they were filling up the law firms with very talented people who were 10 years older than I was. And that was going to make a really big difference. I wasn't going to get the chance to advance and promote myself along the way.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It wasn't all love and affection, it was being very, very realistic. We got along wonderfully well. I had a great father, a great mother too. It was one of the lucky blessings of a lifetime. But dad had gone into the law knowing that there were wonderful people practicing law. And he had two or three really powerful arguments. Number one, I wasn't cut out for the law because I'm not fundamentally a scholar.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“That's roughly right. They didn't actually offer me the job. They posted the job to people who would like to apply for the job. And I was very interested in Goldman Sachs because my father was a lawyer and he said, it's the best firm on Wall Street. It's not the leading firm yet, but it will be. And that was the kind of outfit I wanted to join. But when I looked at the ticket as to what you're going to get paid, I realized it's not going to work because I was getting married to a wonderful woman who had gone through Wellesley College on scholarship and loans and the commitment to Wellesley was you'd pay off the loans. And I knew I was going to have to do it.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“No money, you really have to be very good to get to the top of the group. At the top of the group, it's quiet and lonely, and I realized I'm a social guy. I didn't want to do that.”
2015-03-28 · Masters in Business · CFA Charlie Ellis: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source