YouSaid · the spoken record

David Kotok

lines on the record: 94
first: 2015-07-11
most recent: 2015-07-11
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

“Preparing yourself to be in the asset management business in these remarkable times you are now writing the textbooks and will be And they'll be used thirty years from now. It's a very, very exciting time to be in finance and economics. I love every minute of it.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And that makes it so exciting. I love what I do. I love it. I get up in the morning. I said, you are in the midst of extraordinary financial times. You spent the last fifty years of your life as an adult mostly as an adult.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“That's right So there's an ethical breach that offends me. I'm a Boy Scout. That's the way I grew up. I learned business methods in a grocery store. And in a grocery store, if you want your customer to come back, you don't put the soiled fruit in the bottom of the peck, and when they take the top tomato off underneath is a rotten one.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Past stock options. And this latest game, this latest game of will impose and negotiate and force a big fine on a bank and show how strongly we're regulating and cleaning the system is a farce.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Was told. There was no penalty imposed. At some symmetrical balance equivalent. To the damage done by people who hurt millions and millions of people.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“In prosecutions on that, if it were criminal in our system, there would be a criminal prosecution. And I don't think I've seen one. We have a new game.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And taking advantage of them. We saw it in a financial crisis. We saw it in derivatives and some of the mortgage-backed securities. We saw it used in the restatements of values. We saw things where banks had an off balance sheet liability. Oh, Repo 105 with Lehman. Exactly. That was criminal. Wow. It's amazing that...”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I don't like when I see. Legal meaning the law protects it being used as ethical. Meaning there's a judgment, and if it's legal, it's okay to do, even if it's going to impose financial pain on somebody because I'm really structuring something that is legal.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“If you're in a high tech state, California, Massachusetts. So you're looking at where would you go today and have a double or AAA level of credit? Very solid history. Never failed to pay, and pay you seven percent a year, return on your investment, year after year after year. You can't find it, and you can get it, it's available right now. You can say to yourself, yeah, but you know, what about other kinds of institutions? I'll give you an example. AAA credit three hundred year institution total funds in the endowment fund exceed the total debt of the institution tax free bond. It's issued by an education bond structure by Yale University. Believe me, they will pay you.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Embedded in state and local government. We may not like the people making the government decisions, but the financial information is mostly clear most of the time, and we have a pretty sound distribution of government throughout the fifty states. Now, we have also poster children for trouble Puerto Rico, Detroit, Stockton, California. It does happen, but as a practical matter most of the time, the muni space is very dependable, and it's under the radar screen of a lot of investors. Shouldn't be, in my view, right now today Treasury bond of the United States fully taxable to an American citizen is a little over three percent. and a very high grade tax free bond to an American citizen is a little over four percent. That's upside down and backwards.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“No. There are some defaults every year, and there always will be. But as a practical matter, the municipal bond space is very good grade credit, is very transparent, by the way. You think about your school board budget. You can go to the hearing. You can read it. You're there. You know the people who are voting yes or no. Transparency is.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“We looked at this and we said it's absurd to think that a hundred billion of defaults in the municipal bond space can happen in one year.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I read Ben Graham many years ago, the classics. Right. The classics, the classics. Now, there is a new book Adventures in Muni Land the Story of the Municipal Bond Crisis from two thousand seven to two thousand fourteen and its in galleyproof right now my co authors, my colleagues are Michael Comas. And John Mousso, and I had a little bit to do, and it's a great book, and it is going to be out in July. And it will be available in August, and Bloomberg Radio is going to help us launch the book on august twenty fifth from our offices in Sarasota, Florida.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“ING and the first book of hers I've read them all I think they're six if I recall correctly five or six I've read them all and the first one is City of Dreams and she's a very skilled writer she's fixed Well, it's historical fiction. So she has taken New York at the time it was settled by the Dutch and Stuverson was the first leader, and she wrote the story about the very tip of this island as she was able to glean from a study of history, and then she weaves a tale, and her sequence of books give a view of New York through this lens of historical fiction, but its very lively writing, it grabs you, and when it does it clasps you to the book, and you don't put it down. I found that way City of Dreams is the place to start, and if you do like it. There's three or four more.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“But it was really war between the British and the French. And when you get into that history, you find that the tribes of Indians were used by either side. Sometimes they switched sides. And you learn some of the history of a region which is now not taught in schools, it's a history of the United States which has escaped. There are many books on the French Indian War, the early part of America, the pre revolutionary period of America, and they are missing in the literary realm now. There's another series of books written by Beverly Swirling. Swirling has bestseller rankings. She's got a number of books, and she's written about New York, and she starts with the period before the Revolutionary War SW”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Musical entertainment. We started to talk about the region and how the region and the former Acadians who lived there, because that was Acadia, and the history of this region, which go back before the Revolutionary War and deal with the war between the British and the French, which we called the French Indian War.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I'll tell you something that struck me. I came down from Maine to be here with you and to have some things in New York. And then the first gathering at Leans Lodge is coming up the weekend after Father's Day. And we are about forty people. And in the course of the discussions up there with Randy Spencer, as you know, one of our guides and others.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, there's a book by Kennedy Yale Professor, and it's been around for a while, and it's the Decline and Fall of Great Powers. He has a sequel, but the decline and fall of great powers studies that very subject. I found that something to think about, whether it's Rome or Washington. And so it set me thinking in a more strategic framework and helped crystallize that view. There are all kinds of books of history. I've read many of them. And I find that the reflection on history and how things happen and why are very important. And I favor some classical things.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“In the old place or the new place, well, the people involved said we'd like to put that element in Florida, and the people who wanted to service and support it, work in it, said, I want to go, and one at a time. Now, we had to move people. When housing was difficult to sell, when you had economic difficulties in New Jersey, when you had a seventeen year old daughter who was going to the prom and her boyfriend, if she moved, there would be a crisis in the household. And I said, okay, wait till after the prom, wait till after graduation we'll be in two places we want you we want our human capital intact and so we did that by the way she went to the prom with somebody else she broke up with the boyfriend”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“We have to have a shock. Shock comes along we move any kind of shock and whether it's a shock of smoking your cabin and Leans Lodge or it's a financial crisis in 2008 in Lehman fails you have a shock you change it takes Our view was motivated post shock, but it was motivated because we did some serious examination on our clients, our base, our growth, and what did we find? We found wealth in older people are in Florida and people from New Jersey who were our clients were now in Florida. Moving to Florida. And so we were back and forth and back and forth. And we said, we need to be in two places. And so we were in both places. Now once we're in both places, where do you put the next element?”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Not one of them wants to move back, and they are satisfied with the move we hired in Florida a combination of things. We're at an all-time headcount high, we're at an all-time assets high, it's been a marvelous experience for five years.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, we now have 34 people and two of them are in New Jersey, and we maintain an office and address in New Jersey, and we have a client-based in New Jersey because we were there for almost half a century. But our operations are mostly in Sarasota, Florida. There's a lot of good reasons to be there. People say, oh, you moved because of the taxes. I said, well, yes, taxes were one. It's a fact. Lifestyle is another. All of my people took us four years, Barry, to move the human capital to the firm, and we did. We helped people relocate. That took cost.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Still am. We still have a satellite office in New Jersey. We have two people in New Jersey. We have a legacy of business. But you had several”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I give you the story in an abbreviated form. We had looked at Florida for some time. We found ourselves on airplanes every week to some city from Philadelphia. We made a series of inquiries and decisions, East Coast versus West Coast, which city on the East Coast, Palm Beach, Fort Lauderdale, where do you go? Where are the airports? How do you get up and down between the airports? And the west coast we had a person working for us on the East Coast, so we already had a presence. We said, why don't we go to the West Coast and be in both places? One thing led to another. We ended up in Sarasota.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Not only that, we went to the West Coast. So it's a whole different thing. So you want to visit New York, go to Boca. Del Boca Vista. On the West Coast, it's a little different.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I had a partner in 1973. He's no longer with us, Sheb Goldberg. And he and I founded a firm. We came up with a name. We lived in Cumberland County. No great searches on this name. And we named it Cumberland Advisors. And that's how we got the name. 1973.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And people on their own have to evaluate the sewer company, the turnpike, the airport, the school board, to the They don't know how to do it. They've never done it. And so for us, this has been a great thing for Cumberland because we had our own credit mechanism. We're in a new business. We get hired now by institutions to be the backup credit, surveillance in addition to the rating agency ratings. And those are institutions that have to manage, they have constraints, but under Dodd Frank they have to have a second opinion. We're qualified second opinion on municipal credit.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Right. So you think of a major change. Here's a major change. You've got this three and a half trillion dollar space financing state and local governments throughout the United States. $90,000 different entities, forty thousand different bond issuers. And all of a sudden, the method of finance is turned upside down with a shock. People don't trust the bond insurers. They don't trust the rating agencies. Congress comes along, passes this massive piece of legislation. We still don't know what it's going to. Dodd-Frank. Dodd Frank?”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And we have a survivor in the insurance space that didn't get beaten up by going out of the bread and butter business, assured guarantee, and a second one MBIA, but as a practical manner, remember we used to have a dozen. That credit enhanced and had AAA or AAA rating. And back, Stick didn't Right. So, what did they do?”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“The ETF changes monumental, still underway, and is growing. That's number one. In the municipal bond space, we used to have a notion that if it's insured, it's AAA, you don't even know have to know who the issueer is, you don't have to know what the call provision is, you don't give me the coupon and tell me it's insured and it's AAA and that's all I need to know. That change with the financial crisis. Clearly.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, it was in the mutual fund complex, so at 2 o'clock in the afternoon you had to decide if you wanted to sell at four o'clock in the afternoon you'd find out what the price was. The ETF changed all totally.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And subtract it from the index, you get where the managers are, which is what you would expect if you measure the whole crowd So I think if there's one single investment, concept, creator, person that puts something in place. Now you say, Where are we today? We're a shop that does no single stock picking. We manage a few hundred million in the ETF space, and we provide models of ETFs for other managers. And so the amounts involved are larger, but we directly handle, I would say under a half a billion. NETFs in a number of different styles. But we have taken that same fundamental principle low cost, low turnover, or turnover when you have to, don't turn over when you don't. And craft portfolio using ETFs. I think that is a well established principle now that didn't exist fifteen or twenty years ago.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Taxes absolutely. And what do we find? We find that two-thirds of the managers, three-quarters of the managers over time fail to match that index. And they do it, and if you take the total cost structure that it takes to manage money.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Or they could, if they're international, they can. But there's always an explanation. There's always an explanation. And if you ask, if you line up 100 people and say, what is the premier benchmark for the American stock market? It's the S&P 500 index. That notion and therefore the notion of passive baskets, accumulations, not trying to do a single stock choice started really it galloped ahead with Bogle.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Absolutely. So you say, okay, if there was one single idea that has now dominated stock market investing, it's the notion of a cap weighted, large cap group of companies, there is a filtering mechanism. It's standard and poor's. They decide who's in and out of the index, and a basket by weight, and that has had a profound influence. The SP five hundred index cap weighted is the benchmark of the American stock market and has been for years. Now, whether you like it or not, you wanted the Dow Jones, you want the Nasdaq, whatever you want, every single money manager in the US stock market space either has to use it as a benchmark and refer to it. Or explain why not. Well, if they're not.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Tremendous. He set a platform in place, and essentially took a passive approach, and said I'm going to do it, I'm going to do it by waiting the market, capitalization waiting was the theme, and the SP five hundred index became the anchor, and now you think about the fact that that translated into the first exchange traded fund in nineteen ninety three. Spider”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, if you look at a theme, Interesting themes in investing. The first theme that I think is. Has had a massive influence. Is Bogol and Vanguard. Tremendous.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“But what I've learned is this. What I've learned is this. We talked about the enduring nature of interest rates and how important they are. I've been a student of central banking, monetary economics all of my adult life. I chaired the central banking series of the Global Interdependence Center, and it's been something that's been of interest to me. It's been a passionate terms of study. So you look at central banking and monetary economics and you say, well, how do you put together policies in systems? How do central banks ever get true independence? And is there such a thing? And what are the political forces that are always trying to influence monetary policy? And they are many. And so I have studied that in great depth. I think it is the most serious input into asset pricing, and therefore if it's a serious input into asset pricing.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Ah, well This is an accumulation of decades. So this is not such an easy question I don't like to talk about others because I don't want to say anything negative and therefore if I only say positive things well don't tell us who's terrified.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“All right, now we're mired in hell for the next 50 years. Gabby was the. The first serious economist who mentored me in the early stages of this business, and he had a wonderful, he spoke with a deep Hungarian accent, and he had a wonderful line I learned from him. And it was something like this. I'm going to massacre the accident. But he had said, You can have a PhD and still be an SOB. And that was a line I learned from him. But I also learned a lot of very good economic thinking from him.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“He was a mentor to me when I was starting out in this business. In fact, the first serious work that I published was with a journal that's no longer in existence, and we co authored it together, and it was a piece about long cycles. You're refreshing all this memory is flooding back now. And we talked about the Kondratiev cycle and the kitchen cycle.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“We can track people down. I don't know if it'd be interesting. I never Googled him. But in thinking about it, there was an economist in New York. His name was Gabriel Carrak. He was Hungarian. His history is was back to the good body era way back and forth, which is what?”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Now, you ask me that in the notes ahead of time. You say, I'm going to ask you about you. And I will give you a name, but it may not be familiar.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Bank of England. And another year we had Mike Dooley. Mike Dooley, when he was IMF World Bank in his career, was the guy who designed the Brady bond to solve the South American financial crisis. In fact, the original name for that bond was the Dooley bond. Oh, no kidding. And then Nick Brady co-opted the name because he was the Treasury Secretary.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“You have folks who either are journalists and study the world, have to report on the world, they have to be thinking about it, or you have folks who have to analyze it because they're financial market types or they're money managers. Or we have academics or economists. Sure. We mix them all up.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a nice group. And we also have media personalities. Kathleen Hayes has been up from Bloomberg, Mike McKee. He's coming up this year, isn't he? Mike is coming up this year. So you...”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Just sat outside Smeller. The story got embellished because, of course, pretty soon we get the report about your towel. Right. And almost burning down the cabin, which was probably exaggeration. But from almost burning down the cabin became the Ritholtz forest fire acres. And it just, every year gets better. I think it's like a fish. And the fish gets larger as you keep talking about it.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Up. You did. You did. Everybody falls in love with their guide on the first, nearly everybody. Is that true? Yes. Everybody's guide the first time becomes their favorite guide. And by the way, that's probably true of all kinds of things like this, but I've seen it over and over again. And that's okay.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Because his way. Well, it's a wonderful grouping I remember when you came in the beginning. And I thought to myself, well, here's a New York City boy. He's coming up to Maine. And his experience with fishing is to go by locks and zabars. And now he's going to have a fishing rod in his hand. This will be interesting to see. And of course you had a famous episode at Camp Kota. Well, which one?”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, the Global Interdependence Center idea was to convene dialogue in a neutral way and allow different points of view to be discussed. And hopefully you get people of goodwill together in such a discussion and some good outcome occurs. That was behind the thinking of it. Convene dialogue with a neutral platform. That enabled us, by the way, to invite people who otherwise wouldn't go to other platforms, because here was a place that said just by coming and having a discussion, you created the way in which things may get better, and that was mostly in economic trade, monetary affairs, but it was also in health and in water and that sort of I was the program chair.”
2015-07-11 · Masters in Business · Cumberland Advisors David Kotok: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source