I

appreciate you coming and doing this. You are somebody who I feel like a kindred investment spirit in some sense. I read a lot of what you write, and it always seems to resonate with me. So I think probably this whole podcast, I'm going to be subject to some major confirmation bias, but it'll be a lot of fun in the process. No, I totally agree with you. I feel the same way.

When I discovered you on Twitter, I found myself drawn more and more to blog posts and your tweets. I have this line that if two people always have the same opinion, one is unnecessary. So I don't think we always have the same opinion, but we'll try to be necessary today. All

right. I'll try and be the unnecessary one and let you do the talking. I just interviewed Ralph Powell, and he makes an interesting point about, he thinks when you start in the business, the environment that you come into, market environment, really has kind of a formational effect on your investment philosophy and et cetera. Could you tell me about when you started in the industry and what the environment was like and maybe how that was formative in your investment process? Look, I

mean, Ralph's a good friend and I could not agree more that that is the case. Look, we're all human animals and we are impacted by the environment in which we act, particularly in our younger days, when we're more impressionable and we don't have any experience to compare to. So the short answer is I started my career in investments the month before 1987. So you could say, I'm a victim of that, so to speak, but not really in the sense that I didn't know enough to know. And also I was on the bond side. I actually went to school to be an architect that lasted one semester, I switched over to engineering, that lasted three semesters, and then I decided what I really wanted to do instead of what Dad wanted me to do, which was thought I wanted to be a doctor. And I spent the rest of my time at Notre Dame studying science and biology and chemistry, and senior year decided not to go to medical school, went to business school instead, right out of undergrad, which I actually don't recommend to people, but it worked for me because I needed some accounting and finance and investment. But when I came out in 1987 into the work world, what I now in hindsight realized, you don't realize at the time, but I realize in hindsight is I really think science training is some of the very best training for investing. Because investing really is about hypothesis formation, data gathering, hypothesis testing, reevaluation, re-formulation. But I kind of grew up from a series of what I call happy accidents. I went to work for an insurance company out of school, the guy who was doing investments retired, so I took over the bond portfolio, I hired Dan Fuss before he was famous as an external fixed income manager, we ran the rest of the portfolio internally, then I went to work for an equity firm, run by some professors at Northwestern, and here's where Ralph's exactly right, and the formation happens is, so I work with these guys who are deep value investors. I mean, Bill Breen invented low price to book investing. Jean Fama did not, he turned it upside down, called a book to market, won a Nobel Prize for it, so Bill's pretty pissed about that. But Bill was the first guy to come out, and he was using the Vax computer, this was pre-PCs, hate to date myself, but I came into the work world before there were PCs. In fact, one of my most prized possessions that I unfortunately lost, when I left the first firm, is I had bought one of the very first PCs from Michael Dell in his dorm room, what was called PCs Limited at University of Texas. But it got a fun, right? Yeah. She would kept that. But, so I went to work for this guy, and he was using the Vax computer at Northwestern, after hours, to do low price to book screening. So the original factor based investing, long before anybody knew what value investing, or value investing had been around, but low price to book, quant investing wasn't. They raised a billion dollars, back when a billion was a real number, back in the late 80s, and, you know, there were five of us. And I probably would have stayed there forever, you know, learning how to be a value investor, a quant investor, but I got the call. I don't know if you're a big sports fan, but I grew up, you know, college football fan. I actually grew up a Husky fan, you know, you're an Oregon, but I was a Husky fan, not a duck fan. But I lost my train. I thought, because I went down a rabbit hole, Jesse. That's fine.

You got the call.

Oh, no, I got the call from Notre Dame, because when Lou Holtz was the coach at Minnesota, he had a lifetime contract, unless Notre Dame called. And I kind of had the same thing. I was working with these guys. You know, we had a billion dollars under management. There were five of us. The two old guys kept most of the money, but the younger guys eventually would get some of it.