YouSaid · the spoken record

Michael Milken

lines on the record: 90
first: 2024-02-26
most recent: 2024-02-26
sittings or episodes: 1
sources: podcast

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“And so I think it was a big mistake I had made and I'd give that advice if you are on a mission, you should publicly help people understand where we're going, how you're going to get there. Doing that internally even if you have ten thousand employees is not enough. You have to publicly have people if you're going to join. Come along with you during that period of time.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“You need to be a public person. And I was a private person. One of the great politicians of the twentieth and early twenty first century, Willie Brown told me unless you've defined who you are early, it's too late if some event occurs. And I think had we been more public, had I gone on television more or done more interviews, and I declined them all, it would have been different, and I think the course of history would have been different. And so I wrote a note to Bill Gates when they were going after Microsoft as a monopoly in the 90s and told him he should get out there, talk, interview, get on shows so they don't think he's some mastermind nerd that's going to control the world. I think changing the financial system. Giving people access to capital obviously is not great for those that had access to capital they now have to compete.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“simply distributing more information widely. I gave a thousands and thousands of speeches, but I didn't really give interviews. I didn't really go on television. I had a mission. And so When people don't really know who you are, anyone else can make up any caricature in the world. If you're going to go try to change the world.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, there's many. You are what you eat, I began to meditate in ninety three, and I probably ate more hot dogs, that's what people don't know about me than anyone except those that have won the Nathans Hot Dog Contest. When I was at Berkeley, they opened what I call the shrine top dog. And anyone who's ever gone to Berkeley knows top dog, and I did not go to sleep once at Berkeley without having two to twelve top dogs before I went. So giving up hot dogs was a very difficult thing for me. And I've had many friends who have unfortunately died from cancer that couldn't give up their favorite foods. So I think the advice that you are what you eat has allowed me to be here today, and I'm the happiest guy to be with you today, 30 years later.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“There's many I would say studying the data, going into debate at a young age. If you compete in debate and I'd encourage everyone to encourage their kids, you have to debate both sides. You have to know both arguments. You have to see the world. And I think one of the things that's really propelled me over the years is seeing the world through other people's eyes so that I can understand their views of the world, why they feel that well, but That was great advice going into speech and competing in the national forensic league at a very young age.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“August eleventh, nineteen sixty eight, so I would never forget what occurred that day. And I'd say those two people have had a dramatic effect on the path I have chosen over the last 60 years.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“I'd say Gary Becker would be one. He wrote these things in the sixties that I read. He was really the father of the concept of human capital that the assets not in the balance sheet were the major assets, that maybe seventy five to ninety percent of the assets of a country, a state, a city are the productivity of the people. We became close friends. He did get prostate cancer and unfortunately died of cancer about a decade ago. But whereas his work was primarily in the academic area, I applied these concepts both at our Milken Institute, our foundations, and in business. And the second one was the young man I don't remember his name that I met that day august twelfth, nineteen sixty five. And the Watts Riot started august eleventh, sixty five. Lori and I got married.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“People with diabetes in the world due to twenty thousand fast food restaurants, increased carbs, increase sugar, and aggressive protein diets. So I think it's a pet peeve when you see people Who got a disease that probably wouldn't have. There's a high correlation between heart attack. Diabetes strokes and being overweight. We did a study back as far as 20 years ago showing that just the change in weight in America cost the country 1.5 trillion a year. People don't remember in their very first Super Bowls there wasn't one alignment that weighed 300 pounds. And if you look at that today, you can find a high school where every lineman weighs 300 pounds and you just can imagine what's going to happen to them in their lifetime.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think one of my biggest pet peeves is lack of prevention. So most of the money in health and medical is spent on care or cure. And if we dealt with it early, you could prevent these things from happening. And so we spend very little on prevention. We're trying to build into insurance companies and companies today that they will pay for exercise or other types of things. Many companies today make their healthier food offerings cheaper in the corporate cafeteria than they do others. So I think we have so much knowledge today of what sugar does to your body and other things do to your body. We can see what's happened in China. We're almost forty years ago no one had diabetes and now they have the most”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think most people don't know that I was voted the friendliest and my wife was voted the most likely to succeed in our high school graduating class Yes, I was the head cheerleader and Sally Fields because my head song leader, but my wife was the one voted the most likely to succeed, so we met in seventh grade and I've stayed close to her ever since.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Visiting early childcare centers or elementary schools. Young kids have no filtering mechanisms. So when you talk to them, And I always feel the future of a country can be seen by visiting the schools. So when I first started going to China and the Middle East, I always would go and visit their elementary schools, sometimes middle and high schools, just to see what the kids thought, what they're learning, what they believe in. And so it is invigorating”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Almost overnight in deaths from melanoma, deaths from prostate cancer and others that are with us today. Sickle cell anemia and other things using CRISPR is going to be approved. You're going to eliminate this disease, eliminate it. And I would say Seeing a vaccine go into a human being not in a decade, but in nine weeks that worked bodes well for the future. As it relates to so many things social media and technology, it brings blessings and it also brings many challenges. But being able to live a healthy, long life Will allow us to have the ability, and I feel it's our generations' responsibility to eliminate many of these diseases as a cause of death. And I do believe the thousands and thousands of people they had chance to work with who all have their PhDs in finance today are out there financing good ideas and businesses the future.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I'm proud of my wife, who I met in seventh grade 65 years ago in our relationship. I'm proud that our kids are responsible members of society and we've been blessed with ten grandchildren. So what is your greatest legacy, your greatest legacy, in my opinion, is your children? Will they be productive members of society? Will your grandchildren? I think seeing the death rate for many of the diseases we dealt with, dropped by fifty, sixty, seventy percent. I was in Houston. A few years ago I met with forty seven patients that were stage four melanoma, average life expectancy under six months, who are all in total remission. And so we work for ten years on these checkpoint inhibitors and prostate cancer. They were not successful for a number of reasons. We're working on different strategies today, but a fifty percent drop.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Was a social scientist. And if you ask me again today, I would tell you the best investor is the social scientist understanding where the world is going.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“It took four million years of evolution to extend life expectancy by eleven years. In the last hundred and twenty, we're up by 40. 20% of all people in the United States died before their fifth birthday. In the world in the start of the 20th century, half. So if you wanted to have six children, you needed to have 12. If you wanted to have three, you have six. The enormous population explosion and things happening in sub-Saharan Africa today is a byproduct of the breakthrough of many of these medical treatments. A woman today has a 2% chance of passing AIDS on to her child down from 95% twenty years ago. So I think if you're a good investor, the very first speech I gave on Wall Street in the late 60s was the best investment.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“even find the scar when they took your appendance out. But now we have non evasive surgery, shooting your body with sound waves and knocking out the bad cells so it's like going to a dentist. We're going to be able to clean out the bad cells in your body so you go it's an outpatient you go. They zap the things you don't want in your body and you go home and periodically you go in for a checkup to make sure you can do that again. But it's now been approved for 50 or 60 diseases. I have a good friend who had terrible tremors all these years. He went in. When he walked out he had no tremors. So there's enormous potential. It's been approved for Parkinson's and other diseases. When you think back that life expectancy on planet Earth was thirty one years of age in nineteen oh nine. And today it's mid seventies.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Amazon and companies like Amazon now allow us to deliver goods to places that were food wastelands in the country and places you didn't have access to product and services. Today, they can be delivered to your door wherever you might be. The internet, a great leveler of civilization. You might be in a school, there's no physics teacher in your high school, but you can take the class online and get credit in your school today. I feel technology affords us. I couldn't be more excited about focus ultrasound. Now I'm a Star Trek kid from the sixties. The idea that you can have non-evasive surgery. So he went to minimally evasive surgery where you're in the hospital less damage to your body, etc.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“So there weren't too many people lined up in the 1990s to say, okay, sequence my genome here. I'll give you a billion dollars and I'll come back in 10 years and we'll figure out what the issues are. At $100, at twenty dollars, at fifty dollars? It's now available to all of us”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm excited about the leveling of the playing field. If I don't know who I'm making along to, it's pretty hard to discriminate. So if I'm buying a securitized mortgage, okay, and there's a thousand people that are borrowers, I don't know whether they're born in the United States, Mexico, Dominican Republic, Nigeria, wherever they might have been born. I don't know where their parents are. I don't know where they went to school. And so securitization is a democratization of access to capital in that sense. So I'm excited about that and how that works. Number two, technology. The ability today to drive costs down.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“The foundation of our country is education. And we were really the first country to decide we're going to offer education to all of our citizens. And when you look at our country today, 50% of every software engineer or scientist in Silicon Valley in the last 30 or 40 years was not born in the United States. 60% of many of our medical research not born in the United States. 77% of everyone in PhD programs in AI not born in the United States. We have been the beneficiary of immigration, so we need to revitalize this commitment in education.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“While we've seen test scores drop, and so the world looks at America as the ideal of the America, as America as a meritocracy, that you can succeed, have access to capital, regardless of who your parents are, where you were born, your religion, your race, and you'd have a chance to succeed, and if you failed a chance to try it.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“I had a look hard in the nineteen sixties to find another person who was a math major in finance. Today you don't have to look anywhere. They're inside every company. And so when you think about the United States and the future of this country. It is so important today that we educate our children to the level of world standards, and we let our children down by making them think they excel when our standards are 90% tile here in the US in math might be a 40% tile in another country. As many people know, we've had massive grade inflation.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“going to college online. And so at the peak our company, we represented 30 different universities, University of Florida, Vanderbilt and others. And so you're actually going to us, we ended up selling that company to persons. And likewise, we launched a very catchy organization called Mike's Math Club, where we gave special skills to kids beginning in elementary school so that they would love math and we would empower them so they could multiply two digit or three digit numbers in their head faster than a calculator, they would know one hundred and six times one hundred four is eleven thousand twenty four before you could pick that up in a calculator and getting them to love math. One of the highest page professions in America are people that are mathematicians. And the financial world today has changed dramatically.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“It all starts with education, and we discover outside of the parents or the guardians, the most important thing was the teacher in the classroom. So we started these awards programs. My brothers overseen them all these years to try to lift the self-image of the education profession. Today we probably have given 3,000 of all these awards over the last thirty eight years. We have launched online schools, a company that became a whole new industry, virtual charter schools in the 1990s. It's a public company called Strive today, but millions of kids. If you're in a school area where it isn't safe to go to school, you can get your classes online. The state and these virtual charter schools will treat you like you're a public school student. You get your computer free, broadband free, teachers free, mentors free, all courses, and we built out every lesson for every day. For college, we created an industry that's widespread now.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“For we've been active for 50 years, but when you think about it, most people, when they think about what made the United States, the United States, they think of freedom, democracy, Bill of Rights, Declaration of Independence, immigration, et cetera. But between 1870 and 1960, The United States added one year of formal schooling every decade, and by nineteen sixty the US was the most educated country in the world by two years more than any other country. Since then other countries have caught us and passed it. And so in the recent study shows in K twelve education that US now ranks thirty first in the world. To me, you want to be able to do something, you want to execute, you want people to come up with new ideas, new industries, entrepreneurs.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“And so you can wait and see if you're willing to see by changing your microbiome changes. And so understanding your metabolism and things has a major effect on your outcome. And today, they've now approved giving the microbiome of one person who responded well to treatment to another person that didn't respond well and see if they can respond well. So we've learned today that this exists, it's available, and the promise of science today is so unbelievable in so many ways. There's so much exciting things happening.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Of things that look like they're aggressive might be non aggressive, and for some people doing nothing is an alternative than understanding where the leading research is. You might have an institution that are, say, the number one institution in the country in cancer overall, but in a particular form of cancer, they're 40th. And then you want to make sure, like anything, that if you talk to a surgeon, they're likely to suggest surgery. If you talk to a radiologist, they're going to suggest that. And so let's get a few opinions from individuals. And so those are some of the steps. And nutrition, personal discipline is hard. Not everyone can do that. But for many people, with what appears to be serious disease, if you're willing to change your lifestyle, you can do what's called active surveillance.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“First let's find out what your disease really is. So if someone tells you you have breast cancer, there's many kinds of breast cancer. If someone tells you have prostate cancer, there's many kinds. What do you actually have? Not a generic name. So you can sequence your own genome today. Maybe for a hundred dollars, not three billion, which it cost and took 13 years, spent in an hour. Two, you can sequence your microbiome. And three, you can sequence your disease. So let's find out exactly what disease you have, what form, what is the mutation, and my guess is in ten years a person will say I have an XYZ mutation. They're not going to say I have this disease that's been identified in a part of my body. Once you know that, things that look like they're not aggressive can be aggressive.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“When someone comes to you with some type of cancer and it's early and they have the opportunity to do something early. Are there two or three things that you've learned from your research that are the most important actions for someone to take?”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Before that technique is well used, but we can change how your genes are expressed by changing your lifestyle, what you eat, what you drink, and what you do. And therefore, even if you have a high probability of getting a life-threatening disease, you might not, by changing how your genes are expressed. So prevention is one of the great ideas today that we all could employ. And I, let's say became extreme in this area of what I did. For two years I did not eat anything except raw vegetables and raw fruit, because I didn't know if cooking or anything changed the molecular makeup, and it might not work, but it wasn't going to hurt me.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“These are issues that are important in life. There are issues in the stock market that goes up and down are bonds, etc. But things that are life and death. And I would say to you, one of the biggest mistakes that most people do that are diagnosed with a potential life-threatening disease is they don't do enough at the beginning. So at the beginning, they do the least possible and hope it works out. When they have reoccurrence at the end, they're willing to do anything to stay alive. And if you did a little more at the beginning, you wouldn't maybe have a reoccurrence later. And I'd say the other thing we learned is prevention and wellness. We've invested hundreds of millions in studying your microbiome today. And we know that we can change your genes today with CRISPR, but we don't know what happens. So it might be decades.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“the US government has invested in an incremental five hundred billion in medical research, and part of the side of that was why we found a vaccine in less than a year in the RNA work. And people don't realize, but it was only seven weeks, 63 days between the sequencing of the DNA of the virus and the first human being that Moderna gave the vaccine to. And so it's an area I've dedicated my life for twenty years to as a philanthropist. And now I've dedicated the last thirty years as an activist and philanthropist.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Science I had never done any work in prostate cancer in the form of cancer I had. I'd done a lot of work in breast cancer, melanoma, pediatric neurology, but not in this area. And so it took me 30 days to figure out a strategy and then implementing a new organization we called CAPCER CAPCRE CA All Cancers, P prostate cancer and cure all life-threatening diseases. The first step we analyzed was to tell people we're not going to be a threat. We're going to increase funding for all diseases. We didn't want people to think we're going to divert funds and we spent a number of years trying to figure out how to double the National Institute of Health's budget, the largest funder of medical research, and eventually put on a march, a half million people in the country.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think it was John Lennon had in a song. You have a plan, life plan, and then world things happen. So I had lost ten relatives to cancer. Our children had serious health challenges. In the mid seventies, when all my economic theories proved to be correct, we were faced with all these health. So I've been involved now for fifty years in medical research and trying to apply the same thing we applied in finance and the economy for medical research, sharing information, sharing data, getting people to work together, having a be fact-based, and bringing capital. And so I'd been funding cancer research for 20 years when I was diagnosed with cancer, and yes, they told me I had eighteen months to live thirty and a half years ago. Yes, you had to find a way to deal with that issue, and I focus very heavily.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“So democratization of finance has been a key underpinning of so much of your life. There was a point in time a long time ago where health became a real issue for you and you spent a tremendous amount of time in the subject of this book Faster Cures on Medical Research. And I'd love to hear some about that journey.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“I start with the individual and do I have confidence how does the individual see the world? Do they have blinders on? Are they willing to see the world? Can they change in any business? There are changes. What you expect might not occur. The unexpected occurred. COVID occurs. Can you adjust? The very first decision we make is on people. After that, we can make a decision on industry, structure, where in the capital structure you come in. So I have many things on my plate, not the least of which is medical research. Most people don't realize why I'm there that the number one driver of economic growth in the last two hundred years is public health and medical research. And so more than 50% of all economic growth can be attached to public health and medical research. I don't sit in a trading desk. I can't look at in a day-to-day basis, so we are dependent on individuals.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“In a period of time fifteen thousand structures AAA almost all of them real estate and in some cases you lost one hundred percent of your money in AAA. Sovereign debt has not been a good credit over time. And the final conclusion is debt markets underpin equity markets. If I'm able to get significant double digit returns in debt and I have actual assumptions of seven or eight I don't really need to go to equities and I think we learned that time and time again.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Not a forward looking measure, and you might rate a company whose future doesn't look bright or is going to be disintermediated high based on the past, or you might rate a company low. I mean, Tesla was not investment grade debt even if it was approaching a trillion dollars in market cap. So it just took a long time to get there. For most loans to real estate are not investment grade. And if you want to identify the major financial problems of the last 20 to 30 years, you can be traced down to this belief in overinvestment in real estate and the belief that you can leverage it up. There's maybe three companies in America that rated AAA. SP rated.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“over time and the future. One of the things I learned over the years, the six lessons of credit that occurred, one its credit not leveraged, and so leading into the financial problems of eight and oh nine, you saw companies dramatically leverage themselves up to get the same equity rates of return, but they weren't the same credit. And you saw people leverage 10, 20, 50 to 1 in some of these financial institutions. That isn't the case today. Second, I really have never met a person over a long period of time who's generated a high rate of return by guessing where interest rates are going. So yes, you're right once, yes, you're right twice, but not in the long run. So making investments whether interest rates go up or down is a key decision. Three, rating agency ratings are a trailing.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think for the last decade in many ways fifty percent of every country being sold by private equity was sold to another private equity firm. Today, if you have longer-term debt, you can't really sell the company unless you're selling it to an investment grade type credit. So I think you're going to see a private equity company buy part of another company to provide some liquidity. So I think you're not necessarily selling the company, you're going to bring new capital in so you can get distributions. I think that will play out. The sophistication today of your private equity, many of your private equity firms are larger credit firms today, and private equity is the smaller part of their business. They're very sophisticated, and in my opinion, they will be buying up the debt of many companies to exchange it for equity as a way of buying, and I see that occurring.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Almost 50% of the twenty thousand largest companies in America are owned by private equity. Many of these capital structures were built in twenty seventeen, eighteen nineteen, twenty twenty one when interest rates were very low. So many of them today have the wrong capital structure at the wrong time. So you leveraged seven to one. And if I loaned you money at 15%, say in 1983 and you were leveraged three to one, you were paying 45% of your cash flow out in interest. Well, if you borrowed seven times and you borrowed at six, you were paying forty two. But if you have to refinance at ten, there goes all your free cash flow. And so we're going to see in the next few years opportunities to exchange debt for equity and recapitalize good companies and good industries.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Often the chief financial officer became the CEO. Today, when we think of the challenges, I think you're going to find many of the people that were the head human resource manager eventually goes to become CEOs. And Cano Attract the Best and Price? Can you retain those people? Do they believe in your mission? Do they want to work for you? Are they proud working for your company? Many companies have the wrong capital structure. Today,”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Some businesses are highly volatile. You had almost a decade. that if you weren't in technology and you weren't in real estate and you weren't in retail, almost no company went bankrupt in ten years. If you're a supermarket, you might have a totally different capital structure than if you're a tech company. And so for some companies, even a dollar in debt is too much because of the volatility and risk in the business. For others that has very low volatility in their business, you can have higher capital structure. And part of the efforts and the work that I did that say went for my thesis in graduate school was understanding that you could manage the capital structure of a company the same way you could manage the operating side of the businesses. And in the 1970s, because there was so much stress in the early 80s, interest rates overnight going to 21%, et cetera.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“MDC and Larry Miselle just was sold the other day to a Japanese company for the highest price it ever traded. I believe if you feel you have a mission and a purpose, then you can get a lot of people to join you on that mission.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“So even their own employees didn't want. But they were one of the largest government contractors. The government was very dependent on them. They were making a lot of money in that business. But it was blurred by all those other things. And Textron made an offer to buy them and its stock got obliterated because the market thought they were out of their mind. And the company eventually survived and built and the debt that traded at 15 cents on Dower never missed an interest or a principal payment. And today, I believe is the largest government contractor. So many of the stories are rebuilding stories that you see when you look back and whether it was cable, whether it was entertainment, whether it was media, whether it was home builders. Home builders were constantly boom and bust. They borrowed short when things were great. They made money, and when things were bad, they went bankrupt. And one of those companies”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“And Lockheed executed maybe ten things. One, they went into commercial aircraft they weren't in and lost billions of dollars. Two, just in case they had demand for the commercial aircraft, they didn't go with United Aircraft or GE for engines. They went with Rolls-Royce. And Rolls-Royce went bankrupt. People weren't willing to buy airplanes that didn't have engines. They built their plant over the major earthquake zone in the United States in case you could catch an earthquake. They borrowed short. They paid dividends. They didn't want any long-term debt. They had a backup contract, a Navy contract, an area they had no expertise, and they lost seven or eight hundred million as a backup plant. And then they bribed some of the royal families in Europe so that you wouldn't even want to save them if you had to.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“sat down and said We're going to have a meeting in the mid-1960s with our board of directors and you were the chairman and you told them today we have five years to go bankrupt. I want you to come back and give me your best ideas on how we can go bankrupt.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“Our clients, our investors get paid on the back end long term. Did the investment work out? Did it pay interest? Many of the stories that I have enjoyed the most are rebuilding stories. In the case of Toys R Us, they came out of Interstate Department stores in the 1970s where you were building. They had a great company hidden inside a company that was losing a lot of money. And it was hard to see Interstate department stores jewel, which was Toys R Us, which at that time in the 70s was very small compared to the overall company. One of the great opportunities that never occurred occurred with Lockheed in the early nineteen seventies. You had Textron and Lytton offered a bylock. The debt of Lockheed was trading at 15 cents on the dollar. And if you and I had ever”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“While some of the best things you do are things you don't do. People think there's a commonality of interest. So with an investment banking firm, you have a merger and acquisitions department. They get paid when you do a transaction. So often the people that are the best is getting people to do things so they can get them to do things. And I would often ask them, have you ever seen a deal you don't like? Okay, you like every deal. Now they get paid up front.”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source
“And their rewards were their success. I remember with Craig McCall, I told Craig when he came to see me, and he was really the person that changed the course of mobile in this country. But his family had built radio stations, cable, paging, other industries, and I told him that he's going to have to sell everything his family had done, that this was going to become so capital intensive, West we could leverage, but he would need to have equity, that if he truly believed that mobile was the future. And he essentially, unless he wanted to be deluded to little to no ownership, was going to have to make the decision to bet on mobile and give up what the family had done, which he did”
2024-02-26 · Capital Allocators · Michael Milken – Innovations in Finance, Medicine, and Education (EP.371) · IDENTIFIED FROM THE TRANSCRIPT · source