360 One Firm (361Firm) - Interviews & Events

361Firm Briefing "Moody's, Markets and 'Triple B' Act" (May 27 2025)

Episode Summary

361Firm Briefing "Moody's, Markets and 'Triple B' Act" (May 27 2025) The 361Firm Meetup and Briefing on May 27, 2025, covered various updates and introductions. Mark Sanor and others discussed the attendance of new members, including Nelson Stacks from Waltham, Massachusetts, and Fabian Cousteau, a third-generation ocean explorer. The meeting highlighted the upcoming events in San Francisco and Seattle, including visits to Microsoft in Redmond, Valve Gaming in Bellevue, and the Mayor joining us in Seattle. After Stepher Burke's presentation on markets in light of the US Budget negotiations, Moody's ratings change, Olga Loy shared her insights on changes to expect from the "Big Beautiful Bill" including the impact on private equity, venture capital, extension of opportunity zones. The conversation also touched on the challenges and opportunities in the global economy, particularly in the context of AI and energy innovation. The meeting discussed energy policies, highlighting the shift towards oil and gas over renewables despite high production levels. Jeff Zawadsky noted the delay in SMR applications. Anthony Gordon mentioned VISTA Energy's 262% growth last year and future helium mining on the moon. Andrew Fisch emphasized the negligible impact of new U.S. drilling at $60/barrel oil. Sameer Sirdeshpande discussed sustainable hydrocarbon use. The discussion also covered the potential for China to take over Taiwan by 2027 and the impact of the Ukraine war on global politics. Joe Azzaro stressed the importance of fiscal discipline and productivity improvements to address global debt issues. SUMMARY KEYWORDS NMR company, multi-coast, Bitcoin, digital markets, Tate County, TIFF, secondary fund, venture capital, AI, tax plan, opportunity zones, clean energy tax credits, nuclear deduction, energy policy, renewable energy, nuclear power, hydrocarbons, tax incentives, drilling dynamics, natural gas, AI healthcare, longevity, helium mining, global debt, productivity growth, interest rates, inflation, geopolitical tensions SPEAKERS Contributors included Jeff Zawadsky, Sahir Ali (Modi Ventures), Greg Wilder, Kate Lawrence (Bloccelerate), Candice Beaumont, Andrew Fisch, Marc Rosenberg, Anna Cardona, Sameer Sirdeshpande, Marius Kreft, Anthony Gordon, Fabien Cousteau, Maher Nasri, Lara Druyan (SV Data Capital, Palo Alto), Carl Pro, Mark Sanor, Nelson Stacks, Ben Narasin, Joe Azzaro, Olga Loy, Günter Schmittberger, Roger Arjoon, and many others.

Episode Notes

361Firm Briefing "Moody's, Markets and 'Triple B' Act" (May 27 2025)

Transcript: https://361.pub/TranscriptBriefingMay27
Video: https://361.pub/vidMay27

The 361Firm Meetup and Briefing on May 27, 2025, covered various updates and introductions. Mark Sanor and others discussed the attendance of new members, including Nelson Stacks from Waltham, Massachusetts, and Fabian Cousteau, a third-generation ocean explorer. The meeting highlighted the upcoming events in San Francisco and Seattle, including visits to Microsoft in Redmond, Valve Gaming in Bellevue, and the Mayor joining us in Seattle. After Stepher Burke's presentation on markets in light of the US Budget negotiations, Moody's ratings change, Olga Loy shared her insights on changes to expect from the "Big Beautiful Bill" including the impact on private equity, venture capital, extension of opportunity zones.

The conversation also touched on the challenges and opportunities in the global economy, particularly in the context of AI and energy innovation. The meeting discussed energy policies, highlighting the shift towards oil and gas over renewables despite high production levels. Jeff Zawadsky noted the delay in SMR applications. Anthony Gordon mentioned VISTA Energy's 262% growth last year and future helium mining on the moon. Andrew Fisch emphasized the negligible impact of new U.S. drilling at $60/barrel oil. Sameer Sirdeshpande discussed sustainable hydrocarbon use.

The discussion also covered the potential for China to take over Taiwan by 2027 and the impact of the Ukraine war on global politics. Joe Azzaro stressed the importance of fiscal discipline and productivity improvements to address global debt issues.

SUMMARY KEYWORDS
NMR company, multi-coast, Bitcoin, digital markets, Tate County, TIFF, secondary fund, venture capital, AI, tax plan, opportunity zones, clean energy tax credits, nuclear deduction, energy policy, renewable energy, nuclear power, hydrocarbons, tax incentives, drilling dynamics, natural gas, AI healthcare, longevity, helium mining, global debt, productivity growth, interest rates, inflation, geopolitical tensions

SPEAKERS
Contributors included Jeff Zawadsky, Sahir Ali (Modi Ventures), Greg Wilder, Kate Lawrence (Bloccelerate), Candice Beaumont, Andrew Fisch, Marc Rosenberg, Anna Cardona, Sameer Sirdeshpande, Marius Kreft, Anthony Gordon, Fabien Cousteau, Maher Nasri, Lara Druyan (SV Data Capital, Palo Alto), Carl Pro, Mark Sanor, Nelson Stacks, Ben Narasin, Joe Azzaro, Olga Loy, Günter Schmittberger, Roger Arjoon, and many others.

Episode Transcription

361Firm Meetup and Briefing May 27 2025
Thu, May 29, 2025 6:11AM • 1:51:07
SUMMARY KEYWORDS
Sibos, jet lag, NMR company, multi coast, Bitcoin, digital markets, Tate County, TIFF, secondary fund, venture capital, AI, tax plan, opportunity zones, clean energy tax credits, nuclear deduction., energy policy, renewable energy, nuclear power, hydrocarbons, tax incentives, drilling dynamics, natural gas, AI healthcare, longevity, helium mining, global debt, productivity growth, interest rates, inflation, geopolitical tensions
SPEAKERS
Speaker 4, Jeff Zawadsky, Speaker 1, Sahir Ali (Modi Ventures), Greg Wilder, Kate Lawrence (Bloccelerate), Candice Beaumont, Andrew Fisch, Marc Rosenberg, Anna Cardona, Sameer Sirdeshpande, Marius Kreft, Anthony Gordon, Fabien Cousteau, Maher Nasri, Lara Druyan (SV Data Capital, Palo Alto), Carl Pro, Mark Sanor, Speaker 2, Speaker 5, Nelson, Ben Narasin, Nelson Stacks, Joe Azzaro, Olga Loy, Günter Schmittberger, Speaker 3, Roger Arjoon

Mark Sanor 00:00
Them, or I know that Sibos is going to pick on people. So here, it's good to see. Are you in China?

Kate Lawrence (Bloccelerate) 00:09
No, I'm back. I'm still jet lagged, though, but

Sahir Ali (Modi Ventures) 00:11
I'm back. I'm back last night. Good to see you. Good

Mark Sanor 00:17
to see you. Did you meet Khadija and Riyadh. You remember he did? Yes. We had a great conversation. We did, indeed, excellent. Who else is new on Nelson, you're sort of still

Nelson Stacks 00:31
Yes, yes. Thank you. Yeah. Nelson stacks in Waltham, Massachusetts, run a NMR company, very, very small piece of equipment technology at Harvard, and we sell it to the military, Big Pharma, big ag and food companies, and as well as detecting disease and things of that sort,

Nelson 00:52
great pleasure to meet everyone. Actually, I just came back from the multi coast in Sardinia on Sunday as well see

Mark Sanor 00:58
that. Carl, you guys overlap. David, I did have a fun story that someone was in Tanzania, and I got them to leave their vacation and go join a conference for two hours. But multi coast is nice. Who else is new again? I think Fabian Cousteau would like to re introduce him to the group. But anyone else who's Kate? Oh, there he is, Fabian,

Kate Lawrence (Bloccelerate) 01:25
and that's me. Kate Lawrence, how are you? I can get my camera. I'm not new, but I'm back from Matt leap, so just thought to stop by. How old is son or daughter? Three months now. Very nice son, Jack. We were so what did I miss?

Mark Sanor 01:45
Well, what happened in three I remember when I took my honey honeymoon in 2000 It was March 10 or 11th, and the internet just completely cratered in the three weeks that I was on honeymoon. But how the how have the digital markets done during your material.

Kate Lawrence (Bloccelerate) 02:02
The same Bitcoin was 110 when I left and it's 110 when I came back. So it seems like nothing changed. Fair enough.

Mark Sanor 02:13
Hello. Anna from Mississippi. Do I introduce yourself? Re introduce yourself?

Anna Cardona 02:21
Hello, everyone. I'm Anna Cardona. It looks like my your intel. Here we are. Good morning, everyone. I'm executive director of the Tate County exec Economic Development Foundation here in Tate County, Mississippi, that's just 30 minutes south of Memphis. So glad to be here with you this morning. Thank you, Mark. Good.

Mark Sanor 02:45
Good to have you. That's it, Laura. Laura drew in

Lara Druyan (SV Data Capital, Palo Alto) 02:51
morning. Sorry, I'm not on camera yet. It's 730 here in California, and I am a co founder of a secondary fund, long time tech operator and venture capitalist, and also serve on the board of the Canadian Imperial Bank of Commerce's US Bank. Nice to see everybody.

Mark Sanor 03:15
Nice to see you. We'll see you in a few weeks here. Yes,

Lara Druyan (SV Data Capital, Palo Alto) 03:18
looking forward to it,

Mark Sanor 03:19
letting everyone know. Or is Laura? Laura is the fourth row, fourth from the right, so anyone else knew Emmanuel, maybe, or before we Hi Mark.

Speaker 1 03:37
Hi Mark. I was, I'm not joining the event, but I was curious to see the organization as a background. And I'm an entrepreneur in finance, founder of an emerging asset management firm from jinn. Thank you.

Mark Sanor 03:55
Excellent. Well, welcome back. It's good to see you too. And Riyadh. Can anyone else? Hi, Steven. Morning mark, again, I'm sure that must be Fabian Cousteau, but he's on mute.

Fabien Cousteau 04:11
Morning mark, good morning, everyone. Sorry, I do want to interrupt. I'm a third generation Ocean Explorer. I we had the pleasure of

Mark Sanor 04:20
how many third generation ocean explorers are there Fe in the world?

Fabien Cousteau 04:25
I'm not sure, maybe a couple out there.

Ben Narasin 04:29
Great question.

Fabien Cousteau 04:32
Founder of Proteus ocean group and the ocean Learning Center, Proteus ocean group had the pleasure of presenting at one of your events, I believe in New York City, Victoria session, group has for task to build the most comprehensive underwater ecosystem, including a underwater Space Station, along with all the supporting infrastructure, including data and sensor technologies, so that you can have the. Human, human technological interface on our final frontier on this planet. That's in a nutshell, what's taking up 80% of my time.

Mark Sanor 05:09
Can we have your participation in the West Coast? Some of those themes are going to be addressed. That something in the realm of possibility. He went on mute again.

Fabien Cousteau 05:29
I'm sorry, Mark, yeah, I'm in transit. I apologize. I'm just trying to keep the noise level down. Yes, of course, depending on what the dates are. It's a busy time of year, obviously, with ocean week coming up in Nice and Monaco with the finance part of things, and then a few others. But absolutely, look, we'd be honored to join you.

Mark Sanor 05:56
Well, it would be an honor to have you all right, anyone else before I move on. Hi, Mark Rosenberg. Mark Rosenberg, by the way, this, I can hear you. I can hear you. I feel like I need to do this. I think I can do this. Let's see if I have it. I might have to go. I'm going to go to the website, because Mark Rosenberg took us last year to the most amazing place called the family farm. It's just outside. I'm told you can't hear the volume when I do this. Is that right? No volume. Can you hear the volume? Volume? How do I do this? Hold on. We're going to try to do this. Stop Sharing. Share. Think I never done this before. Well, I Yeah, all right, no volume, but you'll get a sense of it. This was the Nano Lab at Stanford. Was probably one of the highlights of any of our tour, the most learning I did in a long time to really understand the history and future of chips,

Joe Azzaro 07:24
which followed mark the history the basically the history of AI too. Those two sessions back to back were amazing. Yes,

Mark Sanor 07:33
it was a good combo of Stanford, Berkeley and in the house. This is, this is Berkeley on the right side at their citrus Innovation Lab. How are you, buddy?

Roger Arjoon 07:51
Oh, you know, scratching out

Speaker 2 07:52
a living? Well, not really, but being enough, I I

Mark Sanor 08:04
think we'll have that same panel back here, Laura Raj and this time, Dave McClure from 500 startups will be joining that panel on secondaries. Brilliant. And this is Mark Rosenberg. He took us out to this. Mark, you there? Of course, I'm doing all this because I saw Mark. I'm here. Yes, just give, give, give 2030, seconds. What is this place? The family farm.

Marc Rosenberg 08:36
Well, we, we lifted out of a club called bohemian club from San Francisco in 1901 when McKinley was assassinated, and went on and bought 100 acres very close to Palo Alto in Woodside Portola Valley, and then created a family farm, and then the members and guests have enjoyed The use of that for all those years with cabins, stages, lectures, presidents as members, etc, and that's what the family farm is. It's just a magnificent, charming area close to Palo Alto.

Mark Sanor 09:18
Well, thank you again. You've also brought us Ed Oates, and

Marc Rosenberg 09:23
yes, a good friend of mine is the co founder of Oracle, with Larry Ellison, and it is really the Wozniak of Oracle. And so he spoken with with Mark on some panels for a number of years, and just a terrific guy and a co camp mate of mine.

Mark Sanor 09:44
There you are also a family farm member. So in the bottom left is Paula Schwartz's home, and San Francisco, where we will be part of the evening of the of the 15th, which is where we start. So let me know. Pull back. Back and go to where I was. So the difference here is that we have Seattle. So I want to give Seattle its its due and and I feel like Erica, do you want to weigh in on the Seattle legs, I should say Redmond, Bellevue, Seattle legs, good

Ben Narasin 10:26
morning, everybody. Yeah, we're getting it put together. It looks like, Well, looks like, we'll start off at Microsoft with the Vice President of co pilot, doing a tour out there and having some refreshments. So that should be fun. And then we'll go downtown Bellevue to gaming company valve, which has the number one game in the world. I'm not a gamer, but I guess it's pretty cool. And then we'll have some snacks and bites around there. I think we're gonna go to civility and unrest, which is a speakeasy in downtown Bellevue. It's kind of fun little secret place. Then next morning, I think we're gonna start kind of bright and early with the mayor of Seattle and a bunch of other like interesting folks speaking today. Are we going to the Edgewater? Is that set where we're going? Yes,

Mark Sanor 11:14
this is the mayor.

11:15
He's fighting.

Mark Sanor 11:20
Oh, I still I like my idea that. Well, I was testing the idea out with Dana yesterday on our call, just to let you know. For example, maybe you could let people know some of the speakers here, Erica, Dana, Dana Frank, but we had this idea of having the bell view mayor and the Seattle mayor on the same panel. She liked that idea.

Ben Narasin 11:43
It's so provocative anyway.

Mark Sanor 11:45
Well, tell us. Tell tell a few, some of the people that you're bringing, like Dana.

Ben Narasin 11:50
Oh, yeah. So Dana Frank is third second. Well, third generation family office in Seattle, her like, 30 year old son is starting to take it over. So interesting. Very interesting unit family in Seattle. Her uncle was Quincy Jones. Like schools and stuff, of course, are named after him. And at one point in time, her father owned a building on every single block in the Central District of Seattle, like every single block. So it's quite an quite. She has quite an interesting story, and she has a book out that's really interesting because he was also kind of brutal, like, for example, he had some tenants that would chronically not pay rent, so he had his handyman go take the door off their unit, like some things that could happen. The book is interesting. Get up and get on it. It's called so she's fun. Mark Mueller is really interesting. He's a family office here, out of Seattle, ex Microsoft guy, but he made a lot of money in crypto and AI, and he's quite smart guy. I think you're going to maybe put him on a panel. I'm not sure we have. Ankur Gupta, who is the vice president of copilot Microsoft, been at Microsoft 20 years, very obviously knowledgeable in the area, so he's super interesting. Walter benedoff is a cross border family office between Brazil and the United States, where they invest in a variety of of things. They actually have trees, lumber mill development, contractors, commercial buildings and building management, and then they have a whole bunch of software to support that, that they invest in and bring to the United States. So kind of interesting guy. John Fluke is a big family office out of Seattle, kind of a little bit of a legend here. Fluke enterprises, global company that sold the Danner that he took over when he was in his 30s. He's also very knowledgeable in AI and does a lot of medical investing and sits on some boards, and pretty smart guy. So,

Mark Sanor 13:38
and you introduced me indirectly to Sam win, yeah, co founder of square,

Ben Narasin 13:44
yeah, he'll be here. I think he's going to be here, right? He could, did he confirm yet? Yeah,

Mark Sanor 13:48
I believe so. Okay, just trying to get him to go down San Francisco as well.

Marc Rosenberg 13:54
But

Ben Narasin 13:55
everybody has new babies, and

Mark Sanor 13:59
you, even you, you've also helped to reconnect with Paul Kang,

Ben Narasin 14:02
yeah, Paul is moderating an AI panel and in very large investor out of Asia, and he'll be moderating the AI panel in San Francisco, and I'll be bringing a few other guests into San Francisco as well. So, yeah, it should be a great conference out here. Hopefully we'll have beautiful weather like today. I have to have my curtains closed. It's

Mark Sanor 14:21
so bright, happy. Be good. I see Jolie lamb. Jolie, you know, I know you were speaking later today. Can you, can you say a word about what's happening at Berkeley today, putting people on the spot? So maybe she wasn't ready, or any well, maybe I'll just give the two minute I was I think we got you got the sense of what's happening in Seattle. But as this slide shows, we start off Sunday. But. But we'll have our collective round table and a panel on female founders that also you sort of had in putting together Erica with Paul. And then, you know, sort of in informal at Paul's home we might is, if it gets too big, there's a place down the street where we might do the formal part and then go to her place for the reception, but we'll see how it plays out. And then, like last year, we went over to Berkeley. I'm hoping to see a bit more Berkeley. That's why I was hoping Julie But Julia and I will speak later today, and we met her through gene key. And then, then off to Palo Alto. Get out of the house. You Austin, want to mute you? There you go. And then, yeah, over to Palo Alto conference at Cooley, and we'll have a great panel on on the zeitgeist. I'm hoping that Ed Oates is back on, that Anurag will be on. Ken Goldman will be on. Heinz blenneman, there's a picture of him. I believe Heinz here, and Ken and Anurag and Ed, you know, just what they see happening in the valley. And then the panel on secondaries. And I mentioned, well, the first is a bit panel on investing globally, because we do have a lot of interesting both families and institutional investors, and then secondaries, and then breakouts. You'll see, we'll have breakouts before I guess this time in the middle afternoon. So before we we have the reception last time in San Francis or Palo Alto, the breakout sort of didn't happen exactly as as best with the best they could have. So we're going to definitely have that before and then have a debrief. Then Then talk industries, AI other emerging industries, and finished with next gen philanthropy. And then we thought we'd have a just sort of a bigger debrief that we know we're probably not going to have great breakouts. The second time around, was doing sort of a town hall debrief, similar in Seattle Zeitgeist panel, you know at least one mayor, if not two others. And you know Erica, someone told me so there's a there's a real estate developer, hopefully that's coming touch wood, that's developing project inside meta, inside Google. But also right at the nexus of Bellevue by the train station. So I'm having this conversation this morning with someone in Israel, and he's referring to, I got this one special deal, one special it's real estate related. It's this in their ex Goldman was like, I know who they are. So

Ben Narasin 18:00
from Saudi,

Mark Sanor 18:03
no, no, Israel. Oh, it's a good sign when, when someone's like, I don't really, you know, don't do much real estate. But this is special. It is special. These guys are developing just $3 billion projects, and they call it main and Main. So it's a really interesting group, but we'll talk about, you know, what's happening and what you know, why Bellevue for them and versus Seattle, its developments, its challenges and opportunities, both areas. San Francisco even has a new mayor is, you know. So a lot of changes there the VC ecosystem as it relates to Seattle, other assets, investing globally, it's similar program break back to industries. Ai this time, we'll focus on space giving, Boeing and some of the related industry players. There other emerging industries, next chance, philanthropy. And then yes, we'll finish. Oh, for if we made time to finish. For those who want to go to Amazon. I don't know if Walter's on, but we couldn't do it at 8am they don't open until nine. We have the mayor, so we've flipped it so the Amazon tour for those who want to go or otherwise, hopefully the weather will be perfect, no rain, and we'll be on a waterfront, and we'll all be reflecting on how much we've learned in the last three or four days.

Ben Narasin 19:29
And the Seattle Waterfront is amazing. They just planted 10,000 new trees. They took down this awful road that's been down there since forever. They built this beautiful walkway that goes from the market down to the waterfront and built a new part of the Marina around it, so the conference will be just like a 10 minute walk from all of that. So yeah, very, very good. Hopefully it'll be great weather.

Mark Sanor 19:56
So I pause, that was a tour de force. Yeah. Any questions. If you you can always reach out to me privately. We can try to get you up to speed, plug you in, whether it's a panel or a breakout. We want to finalize everything this week of questions. I

Anna Cardona 20:22
mean, I know it's probably on the document, but where is everybody

Mark Sanor 20:28
staying? We often have hotels on there, particularly in Riyadh or some other place. I there's a let's, I'll tell you what we'll do, we'll, we'll, we'll add a couple. We, as it relates to Seattle there, there is the the hotel Edgewater, but we are in high season. Yeah, it's expensive. It's a popular place to be in June. So they'll, we'll throw on a couple, let's say, you know, decent, moderate, or you can stay at the edge. Well, that's where the event is, in Silicon Valley, or in Palo Alto,

Anna Cardona 21:10
that part. Well, if others might need that. But obviously I

21:13
live here, so yeah, you but

Mark Sanor 21:15
we will put on the same one. We're probably, if you go to to put the last year's event page. I'll put it on the in the in the chat that had hotels in the valley, in San Francisco, that we all used. Any other questions,

Ben Narasin 21:37
yeah, I was wondering about California, your state in the valley, or are you moving or because they are kind of far away from each other down there. So

Mark Sanor 21:45
in the city, we the same day. We did it last year. We moved from Berkeley over to the valley. We pretty much, you know, there's, we're all hanging out there Rosewood evening. If you're trying to get to the airport the next morning, or whatever. You can plan it accordingly. I stay somewhere and not I'm staying in the Palo Alto area. You if you have other plans need to be in the city, you could head out, but easier to stay there.

Ben Narasin 22:16
Thanks. But can you get up to Berkeley in the morning?

Mark Sanor 22:20
Well, no, we go to San Francisco. That would stay that. So that's probably your point. I would stay in San Francisco area the night of the 15th least I am, because Berkeley is, you know, you're going the other direction. You're going to Oakland,

Ben Narasin 22:34
right? Okay, so you're moving both nights

Mark Sanor 22:36
I am, okay,

Ben Narasin 22:40
sorry, I'm trying to send you the hotels here. It's not so it's not agreeing with me.

Mark Sanor 22:48
Other I guess I want to. I'll pull out and look at our more general digest one second. Do Trey covered everything. Zoom in. So, yeah, we have this you can, you know, last last week, China, you know what I really like are these transcripts. You can see who said what. Anthony was pretty active in his discussion last week, for sure, then we had going back. The other new initiative is our Thursday deal Roundtables for if you want to get into if you're on the deal side of things, let us know we've got a lot of new deals, and we can each have to do our diagnostic. Oops. I'm glad I did that. That took you to a different page. But the diagnostic is not that hard. It's right here. Does that really answer two questions? Are you a QP, basically, and what are you allocating into? And the rest is optional. You can skip ahead and submit. But if you did tell us, you know, if you're interested in VC, we'll say, you know, what stage VC growth, if it's an industry like whatever, AG, then it'll ask you what part of Ag, it's geography, like the Caribbean, maybe like Jamaica that really helps us. It actually helps our AI or I'm just seeing Glen, if you really like North Carolina or South Carolina real estate that helps me connect you to Glen. Say, hi Glen. Indeed.

Anna Cardona 24:53
Hello everyone.

Mark Sanor 24:57
So that. Would be very helpful from in the on the Roundtables I mentioned. And then finally, we have AI, which you can now request to join. So simply, it's similar. It's also for QPS at the moment, but, but imagine very soon, you will all have access to this. This is our deal flow side of things. But you know, if you're looking at deals, two weeks ago, I was the only one talking to myself on this thing, but now the whole community can weigh in we were talking about, I think I could, can I can I talk about that company? I think I can, Erica, right? This real estate company, um, beam reach, you know, he let me record the he's like

Ben Narasin 26:00
any, just trying to send you guys these hotels,

Mark Sanor 26:06
you'll get it. But this is, you know, you can see our videos as I'm talking to the that this is the guy developing $3 billion of projects, and he tells his story right there. And you can see, I have the benefit of his of his deck, but you have to be an investor to have access to that. But soon everybody will have access. I was talking with that person in Israel who told me about this company, but he was, he was interested in something else, and I was able to, you know, consult with them and bring them into to look at this deal. So this is where we where we're moving as a as a community. So if I were to put in Steven Burke, except Steven sent on here, Jack Wyant, you know, I can send jack this message, I want your opinion, and it's not that different than what Jack does for the Queen City angels, where we put up our fund, right? Jack, it's, it's really, you're trying to score these companies by the risk, the products, the team, the vision, the market, scalability, all the things that Queen City angels does, but not with Excel spreadsheets. So I will pause there.

Ben Narasin 27:33
Okay, I put some suggested hotels in the chat. Sorry, I had to put them in, like, one at a time, but at least that's an idea. The Edgewater is where the conference is, but yeah, like 550 a night kind of thing. But please let them know you're traveling with us, and maybe that will help.

Mark Sanor 27:49
Excellent. Thank you. Eric has done God's work in helping us put together the northwest side of this Oh, and we're

Ben Narasin 27:58
gonna have some fun. There's lots of secret things we haven't talked about yet, but no fear, we're gonna have some fun

Mark Sanor 28:03
up here. Wait, can we have one secret thing? Well, we

Ben Narasin 28:07
were talking about going to, you know, we have a big music scene here. It's kind of an underground, gravelly music thing. So we were talking about potentially doing like a jam session and going down watching, like, where Nirvana played, and doing some weird things like that. So just never know That's not weird. Yeah, kinda.

Jeff Zawadsky 28:30
All right, this is old guy joined with

Mark Sanor 28:33
tax, yes, yes. Olga is the amazing Olga Loy. She stand ready. Stephen's gonna set the stage now for what's happening in DC and beyond on the US budget, Olga is the Global Head of Tax at Winston straw out of Chicago, where we've hosted a number of events. Thank you, Olga, and she's got her finger on the pulse. I was asking some of what you know, but what? Wait, the Senate has enacted. And you all, I don't steal any thunder, but the person was like, the Senate can't do anything. The Senate's spineless. So let's hear, let's hear what was really going to happen,

Marc Rosenberg 29:12
right?

Joe Azzaro 29:14
Thanks, and all good. Please correct all the mistakes I make in my portion, because I was away this weekend in Vegas. And this might not be the best one I do. So

Sahir Ali (Modi Ventures) 29:25
one sec here, I've

Joe Azzaro 29:30
been getting my presentation. And can you see the presentation mark? No, I do. I do. That's a yes, yes, yes. All right, so

Roger Arjoon 29:47
YouTube slide show,

Joe Azzaro 29:52
and we're off. Are you seeing two screens or one mark?

Mark Sanor 29:56
I see two. I. Well, now still two, okay, but it's pretty big. I can you're good. I think it's fine, yeah,

Joe Azzaro 30:14
just mess it up. All right, here we go. So lot to discuss again this week, from Moody's downgrading us to the House passing a massive budget reconciliation to an announcement of new tariffs on the EU that were then reversed, including maybe his tariffs on Apple for not producing every iPhone in the US as we got a lot to cover, so let me jump

Speaker 3 30:45
just share its pause. I'm having a little problem here. One sec,

Mark Sanor 30:54
there was a time when I would do your slides. Do you need that?

Joe Azzaro 31:01
I think one second.

Mark Sanor 31:05
All right, I'd rather volunteer, but

Joe Azzaro 31:07
we back on screen. Here

Mark Sanor 31:11
you've started screen sharing. There you go.

Joe Azzaro 31:14
Okay, so mark likes to do what scares and excites for me, what scared me for some time, and going back probably a couple years mark, debt's been my number one thing, followed by a global leadership void. I think we're feeling the effects of both right now. But I saw this quote years ago, and it's one I think should be taught in every school to every person the United States, from the time their kids up to understand that debt has a lot of positive uses, but it is your current consumption of future earnings, whether you're a company, a country or a household. And people forget this, and the bill does come do and I think we're starting to see the debt problem really come to the for a little surprising with Moody's waking up to realize that the US has a debt problem. 13 years after the S and P downgraded the US debt in August of 11, Fitch did it in August of 23 so this isn't a really big surprise, the downgrading of the debt. What's a bigger surprise is the focus on the US and not the focus on the rest of the world. And I don't know if people caught the Japanese prime minister last week suggesting that Japan's fiscal situation was worse than Greece's, and that was before a auction that lacked really meaningful demand, so they came up well short in the indirect bidding on that auction, and was not the best look for for the government, and now you're seeing a spike in rates in the last month. I think the loan rates in Japan were up over 1% on a 10 year bond up 1% is about a 19% loss. So just think of it that way. On the other side of the coin, we have really exciting things going on, which we're going to be talking about all throughout Seattle, which is the innovation leading to productivity improvements, the RE industrialization that's going on, and the infrastructure spend is driving capital flows, national security spend continues to rise. The health care advances are amazing, and they're lowering health care costs. And we have to figure out a way to power up the future economy, and these are the areas that are going to continue to attract capital. So we have this big debt problem on one side, and what I would consider bad leadership globally right now to deal with big problems. We have this innovation that's going on. And I think one of the big themes for me in the US is a lot of the of lot of the costs that the government, federal government's doing, is pushing cost either to the States or to the private sector. The private sector, in many cases, can handle it because of the strong balance sheets of the large corporations, smaller companies are not going to be as well positioned to deal with that, and if it's being pushed on to the states, the states definitely don't have the wherewithal to deal with spending increases coming towards them away from the federal government. So there's a lot of contradictions going on, and further adding to that, the change in terms of trades really distorting economics. So when you step back, the Moody's downgrade, nothing at you for that 200 like 115

Mark Sanor 34:37
is that right? Yeah, Duncan. Duncan. It

Joe Azzaro 34:41
does highlight the problem right now. The dotted line is the public debt, as you can see, that's been accelerating. So is the total debt moving up in tandem. This is a pretty significant issue if we don't have the growth to match it. And you the real issue, though, is a. On the interest cost on the rise. And if you think out right now, net interest is about 3.2% of GDP. It's projected by 2034 to be upwards of 4.2% of GDP. So once you pass having your interest cost pass your defense spending. It's usually seen as a sign of a global leader seeing its final stages of global leadership. This is a point that Niall Ferguson's made multiple occasions, and it's something definitely for the US to keep an eye on. But the federal deficit was growing before the triple B. And by the way, triple B is a phrase used inside the Trump administration to label their big, bold, beautiful plan. The credit markets think of triple B very differently, and that is the last step before junk. And I think the irony of this should not be lost on investors is we're seeing a deficit growing towards 7% next year, for the next two years, is projected, and maybe moving to 7.4 and 28 but we're running pretty much 7% deficits for quite some time. So I think this is really the issue, and I'm not sure this is what's going to get us to the right fiscal place that we need to be as a nation. So a lot of this is going to be dependent on the growth that comes out of the initiatives that are being put forth by the administration, and it's very tough to count on future promise revenues, on things like tariffs driving it, although the tariff number is on the rise, will it be enough to offset some of the other challenges that we have? So think about the markets. This is a look at the S and P and the different issues that we had, starting with the election. Then we hit a record back in February, and then we started down. And on the way down, you can see really Liberation Day on April 2, was what started to drive it to the bottom. Then we started to see reversal of the tariffs. Postpone. Postpone. There's a new phrase on Wall Street I heard today, which is Taco Trump, always, caves, caves. It's Trump over. Always caves in or always caves, caves out when there's a problem. And that's you've seen with the downgrades. Friday, it was 50% tariffs on Europe. Then it was deferred for till June, July 9. You're going to see a lot of this whip sawing around. So keep an eye on that. In the bond area, we've seen rate spike, and look at this chart of the 10 year bouncing around the last couple of years. And even in the short term, we've seen a pretty big move up. What's interesting is we've seen a very significant move up from the time the Fed cut rates last September, and now we're moving back towards on the 10 year, back moving towards 4.6% the 30 year, cross five and came back in so rates are pushing up. I think one of the things for me is we're moving back to more historically normal interest rates and moving off the 15 years of suppressed interest rates, through quantitative easing, through zero interest rates, and that is a change that really slowed to adjust. I think that's when we have to get much tighter in how we're dealing with realizing that the gift of the last 15 years is gone, and we're going to be struggling to work in an environment where you have, you know, 4% interest rates are higher for the foreseeable future, with a bias upwards, if we don't get our debt house in order. That's pushed a lot of people into gold for one reason is the looking at the alternatives of feeling the markets are over priced. Bond markets are a little challenged. Gold has been a favorite investment, as people are looking to diversify. You can see at your identity year in Target up at 4000 and the 26 target at 5000 and there's, I think, two reasons for this high demand from consumers and governments shifting away from the dollar, and some of that is due to the dollar being under pressure. And you can see the chart here in nominal and real terms in the dotted line, but you can see the dollars took a leg down. One of the things I'd be careful about, though, is I think the bond market turmoil is going to put some strains on other governments. I mentioned Japan. Japan is no longer the world's largest creditor. They were surpassed by Germany. Which one one hand should be a badge of honor, but Germany needs to be spending some of that money. So I. Think you're going to see the dollar continue to be under somewhat pressure, but I think you're going to see other countries starting to feel the effects of their fiscal situation. Japan is maybe lining up for another downgrade, for a potential downgrade for them, you have other nations that are looking at really difficult fiscal positions, and the idea of moving away from the dollar is going to pick up steam, but it is hard thing to do, and you'll see that I think it'll be more of a slow, gradual degradation, rather than a big shift away, because I don't think the alternatives are there just yet. The real issue for policy makers right now is where is inflation going? Because low inflation would allow them to continue to spend better. Higher inflation would really put the squeeze on things for seeing rates higher. And I think we've talked about the two sided risk to inflation for a bit of time, and this is the New York Fed survey, and they looking out one year, they're looking at maybe 3.6% inflation. Three years, it's around 3% and then if you go out five years, it starts to drop, then down to trending towards Fed's target. Right now, the market is thinking, Where, where's the Fed going to go? Are they going to cut? Are they not going to cut? And I actually have seen the argument for two cuts this year, and no cuts from coming from a lot of people, depending on the outcomes of the Senate and how they deal with the tax plan, as well as where the Fed is on interest rates and seeing how things are moving. But I think the Fed's in a bit of a bind right now. I think they're going to be a little bit more worried about inflationary pressures. Employment is still quite strong, and until they see the employment side weaken considerably, I think they're going to be biased towards holding rates where they are and not cutting as much as the market might like, or the or President Trump would like. So this is the 10 and the 30 year reflecting the concerns. And I think one of the issues, why I think rates are going to be higher is it's getting harder to attract buyers because rates are moving up around the world. The the the Bund is now at, I'm sorry, the the guild is now at higher than the US. You're starting to see Japan's rates moving off of zero considerably. Germany's rates are moving up. Rates are on the rise, so you're going to require more yield to attract buyers. And I think that's why people should be thinking about for valuations, where the level of interest rates are going to be. And I think we should expect we'll be back at these higher levels for extended periods, and not moving back down to where we were coming out of 23 so shifting to the plan, I think there is some really good things coming out of the tax plan, if they come through. It's a very unusual plan for the Republican Party, where they're not the tax cuts part and the extension of the tax cuts, but eliminating tips, taxes on tips and overtime is a big deal. I was in Las Vegas this weekend, and I can tell you, the workers there are skeptical that it's going to go through, but are very excited about that. If you're talking to seniors and no tax on Social Security, effectively a big deal. But I think the green energy programs are going to get hit quite hard. I think there are other areas the plan that are going to help drive capital into the US and drive business spending. I think some of the things that they're doing in terms of the business credits for new plant equipment are going to be real positives, to support some of the RE industrialization that's going on in the US, but I think there, there's a lot in here for everyone. I'm not sure what the Senate gets through. I think Mark, they will push back on trying to get some more cuts somewhere, but I don't think you're going to see a material change. And I think this is going to lead us with deficits of around deficits of around 7% or higher, and that means we're going to really have to see the growth come and you're going to have to see much greater productivity to work through the fiscal problems that are going to come out of this. The bill, on estimate from the CBO, adds about 2.3 trillion in national debt. Others are saying it's going to be three to 5 trillion additional debt, depending on whether they make some of these cuts permanent or not. I think it is expansionary in the short term, because the spending cuts and the tax increases are delayed. The new tax cuts are immediate, and in some cases, might be retroactive to the start of the year. I think you will see for states like the blue states, the salt tax is going to help some people there. The Ira subsidies are going to be very impacted. These Medicaid work requirements are highly controversial, but I think the expensing of equipment and R and D is going to be a big thing for a lot of businesses and drive some a lot of economic activity. Be back to the US. I'm not sure we know the full effects of this yet, but for me, I think we have to really keep an eye on the interest rate and really focus on whether the government can get their fiscal house in order. And is there anybody in Washington, DC, who actually has any sense of the long term, and how we're going to manage through the debt loads, through all this, though, the market keeps rising, rising up, and I think we will continue to see the markets push ahead because of the positives out there, and because a lot of this program is short term, stimulative, longer term, some challenges. So Mark, I'm gonna stop there. And I think if you want to turn it over, I'll turn it back to you.

Olga Loy 45:46
You want to go, Yes, I this is all guy. I'm going to jump in, you know. So we put together, actually, a client alert on Thursday about some of the provisions of the one big, beautiful bill. And what's interesting is that carried interest that was discussed by the Trump administration was not included in it. So you know, people could take a breath of relief that carried interest is not going to be affected. But what's interesting is that the sole deduction, even though the bill increases the deductible amount, it really negatively affects any private equity fund managers, you know, doctors, lawyers, accountants, anybody who is in the service business. Because what we used to have is the pass through entity deduction where, for example, you know, as a partner in a partnership, Winston strand would make an election to pay state taxes at the entity level, and I would have the effect of the deduction. So it's basically anyone who is in the service business. Welcome back to the $10,000 limitation. Okay, so that extremely negative ly affects anybody who is in financial services, legal, accounting, everything under the sun, so we cannot use this deduction anymore. So what else is interesting about the provisions in the bill? You know, of course, the positives are that there's the freezing marginal tax rates, permanent, reduced marginal US federal income tax rates 37% then expanding deductibility of qualified business income. So it was a 20% 199 a deduction. Now it's 23% what else is interesting, permanently expanding estate gift tax exemption amounts. So that is a permanent extension, extend bonus depreciation, relaxation of limitations on business interest expense deductions. So those are positive things. And one thing that I wanted to point out is that something that mark, you know, you and I discussed previously at our presentations, the opportunity zones. Remember, we talked about it quite a lot, and they were very popular than the sort of 2000

Mark Sanor 48:12
internet team we were, yes, they

Olga Loy 48:15
went away. So, but so the so now that the the big, beautiful bill, act extends the investment period through December 3120 33 and permits the designation of new zones, but narrows eligibility for such designations. So it's basically, you know, it's basically renewed. So let's see. I mean, there, there are different provisions out there that apply, for example, to certain tax exempt entities. There's increased excise tax on investment income of certain private colleges and universities, so they're subject to 1.4% tax on their net investment income, and that act would increase the tax rate of or up to a rate of 21% for institutions that student adjusted endowments of 2 million or greater. So I think that's quite, you know, a big of a jump. And the 2 million or greater of endowment is not a lot. So that's, you know, that's a big change for the universities, private colleges and the universities, and then also there's increased tax on net investment income of certain private foundations. So that's, you know, up to the rate of 10% for foundations with assets of 5 billion or more. So that you know could affect some of the some of the foundations that you know, we'll work with and you know, again, there's also, there are proposals effective clean energy tax credits. So there's acceleration of the expiration of clean energy tax credits enacted in by the 22 inflation Reduction Act. So the expiration is accelerated to December. November, 3120 25 Yes, it's, you know, pretty crazy. So it's credit on the clean vehicles, commercial clean vehicles, alternative fuel programs, residential clean expenditures, you know, by the way, so I personally put in a solar roof. I better claim this deduction ASAP, before it goes away, because that's, you know, this year is the last year, and so that's

Mark Sanor 50:26
on that point nuclear Andy fish, we've talked about nuclear a lot. Nuclear got some, some deduction treatment or tax credit treatment, yes.

Olga Loy 50:36
So nuclear is still okay, but anything that is electric, you know, wind, you know, any kind of alternative energy other than nuclear, is significantly cut back or eliminated so, and there are some international provisions that deal With the deal with the, you know, basically guilty taxes that are going to be expanded. It says freezing deduction for global intangible law tax income for foreign derived intangible income, so freezing base erosion and anti abuse tax rates. And there is a new section 899, which would permit increases to statutory rates for certain income and excise taxes applicable to residents of discriminatory foreign countries that they deem to have imposed unfair foreign taxes on US persons. So this is yet to be seen, so we don't know what this you know, new section 899, will hold so it just basically says up to maximum increase of 20% so there's a lot of provisions. And I think, you know, you could spend a whole hour talking about them, but I mean, like, you know things that my clients are asking for a lot of private equity funds, you know, the answer is, you know, carried interest is not in this BBB, you know, pass through entity taxes, bad news for private equity fund managers, so and, you know, and kind of other other provisions that may affect the way that they do business.

Mark Sanor 52:19
Well, you just listed a lot of things, so maybe we take a beat questions to all. Yes,

Jeff Zawadsky 52:26
I'm just looking if there are any questions that have cropped up.

Greg Wilder 52:31
Hey, Mark, this is Greg. I think Alda did a great job. But two things, I think, two things I think are worth highlighting. Well, before I say that, I agree there's going to be some changes in the Senate, but I think we got a really good framework. And as you know, the Trump administration's hell bet on getting it saying signed by July 4. So I do think we'll have something pretty concrete to talk about July, maybe by the time of your conference in Rhode Island. But people, 99% of the articles you read about the salt deduction talk about it as being related only to the blue states that it affects all states people forget that also includes property taxes and sales taxes and and I'm in a modest house here in Dallas and pay, you know, 13,000 in real estate taxes, and spend way too much money. So if I added up all the sales tax post that it's going to easily double my deduction. It's not going to help the rank and file people, but it helps people in Florida and Texas and everywhere else. I think that's a point that's getting missed by everybody. That's why it is such a big dollar amount that they're fighting over. And then two on the opportunity zones, I got to go back and read it, and Olga may have read it further than I have, but I don't think it provides any relief at all for sales made this year and possibly even next year. It begins in 2027 and provides in a deferral to 2030 and I think we're still stuck with the same law now, which only gives a deferral till 2026 so I think they push that out a little bit. We'll have to see what happens with that, because that's that's that's a big ticket item to the opportunity zones, and I know it's one that's discussed here a lot. So there's a lot of effective day provisions that are all subject to change. And should we do? And she's right, it would take a two hour debrief to go through

Mark Sanor 54:15
everything. Well, that's my point. Maybe what we need to do is, is do that, I don't know is we can pull the trigger with even two days notice. But what's this? Think about it, maybe a couple weeks time. Yeah, yeah.

Olga Loy 54:27
I think you revisit it in a month and see where we are right for the Fourth of July holiday.

Jeff Zawadsky 54:31
Yeah, I see there's a question said, saying, what happened with private equity? Yes, carried interest did hold into capital gains treatment, even though, you know, Trump said a couple of weeks ago, three weeks ago, saying that we're going to close carried interest deduction loophole. I mean, I don't know, there was never a deduction, but there was nothing mentioned in the BBB regarding carried interest whatsoever. So it's still, you know. Still is long term capital gains, as long as the fund holds portfolio investment for more than three years. So that's still, still capital gains. I see there's some of the questions, yeah. Andy

Mark Sanor 55:11
Anthony, Bill Michael, yeah.

Andrew Fisch 55:15
Just, just a quick comment, is the green tax credits solar and wind are actually dwarfed by things like heat pumps, water heaters, insulation and and that really doesn't, doesn't apply to big corporations. That's That's people that somebody taking out their their oil burner and replacing it with a heat pump. So, you know, we tend to think of of solar farms and stuff, but the numbers, the numbers are small there.

Mark Sanor 55:49
Anthony, thanks. Danny, hi. How

Anthony Gordon 55:51
about focusing on any positive attributes? Like I said, Okay, what's new? That's good. Make a list of that.

Olga Loy 56:02
Well, I think, I think I mentioned, so there's a, there is a permanent freezing of the top marginal rates. So the state and local tax deductibility for people that make, you know, basically less than 500,000 is positive, but you know, everybody else is negative. Let's see expanded deductibility of qualified business income, positive, and so the tips over time, car loan interests, that's positive estate and give tax exemption amounts increase positive, right?

Mark Sanor 56:41
We won't talk about the deficit.

Joe Azzaro 56:46
There's a $4 trillion tax cut depending on yes counting.

Mark Sanor 56:52
So all right, so

Olga Loy 56:53
there's extended bonus depreciation. Let's keep it

Mark Sanor 56:56
going. Some other questions. Bill, so yes.

Joe Azzaro 57:02
Bill, hey, yeah, yeah, thanks, Olga, could you go back over the tax on endowment foundations?

Olga Loy 57:10
Yes, yes. So, so it basically says, you know, let me get okay. So the, let me see, hold on a second. So basically it increases tax on investments of certain universities, private universities, and that affects the universities that have student endowments of excess of 2 million, which seems to be like not a lot. So what is the tax difference now? So the increased tax is, hold on a second.

Speaker 4 57:47
Let me just find this. It's like one and a half percent now, 1.4%

Olga Loy 57:53
so it's a section 4968 so they're subject to tax of 1.4% on net investment income. Okay, so the BBB Act would increase the rate of tax imposed on certain private colleges and universities based on the institution student adjusted endowment, up to a rate of 21% for institutions the student adjusted endowments of 2 million or greater. Yeah, that's a huge increase too. It's basically the corporate rate compared to one and a half percent. Yes, yeah,

Mark Sanor 58:27
that's on investment income. Yes. Investment income, yes,

Roger Arjoon 58:32
sorry, what the student adjusted income mean is that like student per capita, sorry, enrollment per capita, it's

Olga Loy 58:39
adjusted. That's the way I read it. It says student adjusted endowment of 2 million or greater. They can't say that. You know, if the university has the entire endowment of 2 million of grade or greater, then it would be subject to tax. It's got to be per student. Yes,

Roger Arjoon 58:55
got it. So, endowment per capita? Got it? Yes, yeah.

Olga Loy 58:58
So, and then the other one is increased tax on net investment income of certain private foundations. So so right now private foundation subject to excise tax of 1.39% of their net investment income. So the Act would increase rate of tax imposed on such foundations based on the size of the foundation measured with respect to the value of foundations assets up to a rate of 10% for foundations with assets of 5 billion or more, got it

Mark Sanor 59:33
so. Michael Hammer,

Marius Kreft 59:35
so I want to go back well first to comment, everybody talks about the permanent tax rates. No, rates are permanent. Yes, I mean, and we should remember that. You know, I am not a fan of the. This big, beautiful Bill, you know, looking at things like salt, if states, if people, in particular states, want to tax themselves higher, then they should tax themselves higher, and it shouldn't be put pushed back to the federal government. Is a deduction. You know, there's so many things you and

Mark Sanor 1:00:24
I both I'm in here in New Jersey, but we can't do anything about it. So I can, but

Marius Kreft 1:00:27
I'm just saying that it distorts things economically. It provides what I would call perverse incentives. The other thing that Steve and I'm surprised you didn't mention is that there appears to be pushback in the Senate, and how that will modify this bill is yet to be seen.

Joe Azzaro 1:00:50
Yeah, I mentioned there are a couple holdouts, but I don't think they're going to do too much.

Olga Loy 1:00:56
I just don't, yeah, I mean, I know that a lot of the trade organizations are lobbying like, you know, like, for example, uh, accountants and lawyers are lobbying against the elimination of the pass through entity deduction for specified trades of businesses, you know. So that's sort of a, you know, it's taken people by surprise, but somebody has to pay for it, right, for sold deductions for other people. So I guess it's me.

Marius Kreft 1:01:22
So then, you know, there's things that are still in there. Section 1202, yes, certainly benefits me. The depletion allowance for oil and gas certainly benefits me. And quite honestly, I would take a pass on some of these benefits if the federal government would get its act together that is Congress and seriously work to reduce the deficit. I mean, and I'm old enough that the deficit, when it the bill comes due is probably not going to hit me or change my lifestyle one iota. It's future generations that are going to be hit, and it's just a crying shame.

Joe Azzaro 1:02:11
Okay, yes, no argument. You're Michael,

Olga Loy 1:02:15
yes. Somebody was asking, is there anything about reducing tax rate on long term capital gains? Nothing, no.

Mark Sanor 1:02:24
Carl, you got a question? Yes,

Carl Pro 1:02:29
my question is from the side, from from people, from the manufacturer side, people who are doing hard, hard things. You know, steel companies, screw companies, manufacturing companies. You know, the things that I'm doing, who rely on investments, the return is got to be somewhere, you know, greater than the bond. But where do you think that that's going to play out? You know, if you look at what's the return on investment that you want for the funds in a five year investment or a 10 year investment? Do you want 150% do you want 200% that's my question.

Joe Azzaro 1:03:13
You're asking one or expect annually.

Marius Kreft 1:03:16
I'll take 150% annually. I

Joe Azzaro 1:03:24
Carl, I think you're asking, is it as investors for a company like yours? What type of return are people looking for as a family office? Is that correct?

1:03:32
Yes, well, we're

Mark Sanor 1:03:34
going to talk about that when you get back on vacation. Carl, yeah, I'm letting you enjoy your vacation, but here you are,

Carl Pro 1:03:45
not only you, but I got you. My phone's blowing up for the other side of the business too, yelling at me. There are no vacations anymore. I don't think

Greg Wilder 1:03:54
Mark It doesn't have anything to do with this specific question about returns, but there is, I think Olga covered it quickly, but there's expense provisions for manufacturers in the US to get deductions for expansions of business assets. I'm talking about real estate too. So that's a huge thing that would be an incentive for US manufacturers.

Joe Azzaro 1:04:16
Yeah, it does seem Craig and Olga that the plan was designed to support the RE industrialization efforts and and all the reshoring that they're trying to do and accelerate it. Yep, that is that theme, I think, is going to be one that you can carry through for a little bit of time with all the other uncertainty is they are going to drive capital back to the US both through the trade negotiations and through this tax plan to incent and send money to flow into manufacturing here. Other

Mark Sanor 1:04:53
Other comments, questions.

Joe Azzaro 1:04:58
Hey, Steven, how? Got a question for you. Joe Azzaro, how are you good? Nice to hear from you today. I'm just curious. It seems like there's a lot of really positive momentum on certain things. You know, we're getting a lot of deals done in, you know, overseas. You know, potentially good news with tariffs coming down the line. We'll see. But I also see on the other side of things, in extreme, with like the yen carry trade potentially unwinding, maybe higher unemployment, structurally due to artificial intelligence coming into taking a lot of jobs. Like, where do you really think it all balances out between tax, manufacturing and everything at the get carry trade and everything else that's kind of going on in the global scale as to whether or not this is a time to be really leaning in and long in stocks, or to kind of be a bit more conservative and take a page out of Warren Buffett's book and be a little bit more cash heavy. What's your macro kind of feel there? I think this is one of the this is a tough time, particularly right here, because we're you just saw from Friday to this morning a 50% tariff proposed for the EU and then reversed that the 50% tariff went on, it would take the effective rate on tariffs from basically 14% to 18% from where they are globally right now. So it gets really hard, Joe, to over commit right now to any area. I think, I think you have to either have a view that you're going to take a longer term view and invest in the secular themes, which is what we do, or you're going to have to be a really good trader, because this is going to be the volatility is not going to slow down. I think it's going to accelerate. And you've moved from just having really trade and tariffs is the issue to now the budgets and fiscal houses around the world, and it's not just the US, and I think one of the things that the US has gotten a lot of attention for all the negativity, and a lot of it well deserved for the way we're rolling out these tariffs and the heavy handedness to allies and adversaries. But at the same time, I think that the rest of the world is feeling a lot of pain. You look at Japan and the spike in rates of 1% is not a good sign. Those are not positives. I think you have a lot of challenges elsewhere. So I think it's a time to be high conviction in the secular areas and low conviction in the non secular ones, and you better be right on your secular themes. I think that's how you play it. I think the I think that this scenario where you almost want to be a VC in the public markets too, where you know you're going to be taking higher volatility and higher risk in the environment we're in, and you should make sure you're getting paid for

1:07:54
it. Okay? Thank you. Hi,

Mark Sanor 1:07:58
Joe. By the way, Mayor, I have

Maher Nasri 1:08:01
a question for you. Let's say I'm interested to see what the feeling of from perspective of venture capital and PE how they analyze at the moment, now, let's say is fresh investment projects in terms of what you expected, like projection expected to have IRR ROI was the inflations need to be embedded, for example, for the forecasting for the next five years, those kind of see was where, where we are in the benchmark. I'm just interested to get more elaborations on the top of Carl question,

Joe Azzaro 1:08:35
I would, I would answer it for myself, but I would send it back to the community. But I think the idea of that you're going to have two to 3% inflation should be a comfortable number to keep in. You need to think four to 5% on the 10 year and invest that way, as opposed to invest with the hope that we're going back to that the Fed is going to aggressively cut rates, because I don't see the long end coming down, and I think the short end may come down a little bit, but I don't think there's the move there, the the ability to push them down as quickly as people would like. So I think that's what I'm saying. I think we're going back to investing 308, where you had zero interest rates, and you have to think about the way you would invest without the help of the Fed providing you a good yield backdrop. Okay,

Maher Nasri 1:09:30
another questions, if you are talking about raising debt, so what the debt covering ratio would be expected to be to match? We say we are on the safe side for the project stress testing. Let's say

Joe Azzaro 1:09:41
I turn that back to the community. I don't have an answer for you on that one. Maybe one of the venture guys could help you with that one.

Maher Nasri 1:09:52
I would say, as a suggestion, would be like 150% from debt covering ratio would be something is that something is good. Or there is a demand for Hi, I just put a question for community as well.

Mark Sanor 1:10:08
These are, these are just non profitable venture companies. You're talking about

Speaker 5 1:10:15
me? No, basically what I'm doing even in us, we are building a lot of, let's say, financial modeling for fundraising, right? And that's something for different sectors, oil and gas, R and D project, medical devices, you name it. So basically, it's like, I'm interested all the time. We are always try to be when I build the model for the client and a PG, try to be on the conservative side and try to analyze the whole business model 360 degree, like, you know, from the investor point before we are addressing the result from them the startup. Question

Ben Narasin 1:10:53
is, how this current economic turbulence is impacting fundraising and venture capital. Yes, it's just a magnification of what has been happening over the last at least year, which is a massive flight to quality, which happens every time there's a disturbance in the market. It's a cycle we go through over and over again. So two things happen when so venture gets exciting, more people, flood in funds, have more money, then they can't hire more people, so they write bigger checks. People get competitive. They pay high prices. 2021 was the high of the sugar high. Everybody talks about then the market shifts. People get upside down. They don't have liquidity. And venture folks say, Well, don't worry about us. We exercise discipline the whole time, which they're full of it. But then they immediately start worrying about triage, which people are doing now. They worry about protecting their best companies, which people are about. Worry about doing now and then when they but they don't stop looking at new opportunities. They have capital to invest, but it is absolutely and only in the best companies. So if your companies are the best companies, the best founders running future public companies of exceptional opportunity, they'll be fine. Everybody else will suffer. The second best companies will, at best, take much longer to fundraise and end up with much more aggressive terms. You know, here's the three stages I've been through in the last I don't know, tenacity is four years in. So in the beginning, some entrepreneur would come in and say, we're doing a million in revenue, we want a $50 million valuation, and be like and I knew I could either say one of two things, yes or no. Usually it was no, thank you. Then the next year, it was, we are doing a million in revenue. Want a $50 million valuation. And what I would say then is, hey, you know, higher than I'm comfortable with, why don't you go out and test the market, and if it doesn't work, come back. And if it doesn't work, come back. We can talk about something new, and most of those people did come back within six to 12 months. Now, when people say, I'm doing X and I want y, I just say, You know what? That's not a viable deal. I can't do that. Let's talk about something I could do. So you're seeing entrepreneurs become more flexible, but it's going to take a while. I mean, they should probably by six months to fundraise if they're exceptional, and if they're not exceptional, they should keep working and not waste their time.

Maher Nasri 1:13:08
Well, from my perspective, as a consultant supporting the fundraiser who needs the funds and try to be, let's say, as give the mentor and try to cover the project, at least, to be acceptable from the financial point as a matrix. Put it this way, well, not as much

Ben Narasin 1:13:26
as that. You can impact that the business is either awesome or it's not. First of all, what you should know about venture is venture does not love people in the middle. They don't like consult. I

Maher Nasri 1:13:35
respect that. But sometimes you shift the cycle, which happened many time with it, with a startup. Startup is like, you know, all my experience is like, you know, is proud about his own technology or his own service or his own product. But under day is when you put in perspective in the financial and say, as a presentation, does it looks nice, so we need to come in order to make it is saleable

Ben Narasin 1:14:02
results, period. End of story. So if someone says, oh, I have this great technology, look, unless you invented the iPhone, nobody cares. What's your Arr, and if you're not doing material revenue with a path to profitability, if you choose to take it, you know, venture capitalist wants you to take that path, if you can continue to grow in a material way. But net, net, you know, there's, this is a game of steak, not sizzle. So, you know it is. There's, you got to also think about, it's very stage dependent. Pre seed, half a million to a million and a half is the only time people can raise money with PowerPoint slides and idea and great talent around the table. I do little pre seed, but I predominantly do seed. And at seed, two to $6 million I expect half a million dollars of revenue or more, and I've gotten as much as 6 million of ARR. The fact that people are doing seeds with $6 million of ARR and not doing series A is a pretty telling statistic. But net, net, if you don't have at least 3 million of ARR, don't even waste. Time going out for an A unless you have just absolute superstars on the team and technology that's going to blow everybody away. And even then, you better have some decent ARR to back it up. Just my point of view from permission

Mark Sanor 1:15:11
Michael Hammer,

Marius Kreft 1:15:13
so I just wanted to jump in with an LP perspective. And I'm in various venture and angel funds. And the fact is, there's too many mediocre funds out there not delivering the results the carry. You know, if somebody came back and said, I'm going to give you a real return of 30% per year, I'd say take a 30% Carey, gladly, right? But if funds are not performing as well as, let's say, the s and p5 100, why should they get anything at all? That's just my opinion. So I've actually been going, and I'm more of an early stage investor. I've been going more towards just direct investments. I see enough deal flow from people.

Roger Arjoon 1:16:08
Well, there's a

Ben Narasin 1:16:10
I'm gonna I agree with you entirely. I was zero and 50 fund, if you want to, you know, do it in a heartbeat. I get, we give all our fees back, unless we lose money, right? I've been doing this for 18 years. I've never had a fund that lost money. So, you know, who knows it could happen? But, you know, one, I think people overestimate the importance of fees, because if you're making good bets, you're going to get all those fees back. I don't get a penny of carry until I give you all my fees back, and neither does really anybody else. I get bumps on 3x and 4x net, right? So I'm very motivated to have high performance. I'm putting in 10% GP, commit myself. I care a lot. The problem is, you've got a lot of excuse the very crap there who have grown their businesses over and over and over again to sizes that are unsustainable and can never deliver returns. There's a very famous fund I will try not to name. It's hard for me not to but first letter A last letter A last letter Z, that just constantly raises more money and hasn't returned for 10 years and probably never will, and yet people are comfortable buying it because they've heard the name. The right answer is not. I'm not saying you shouldn't do directs. Directs are useful. Directs are useful when you can rely on trusted parties that you don't have to worry about why they're hap giving you a deal. The worst deals usually come from VCs that could have done the deal themselves, but then pass them on. But I've also seen historically that family offices and LPS that do direct investing. I mean, they're they're not generally getting the best deals, and they're generally not getting great returns. So unless you're sort of doing the what's what's very popular right now, there are multiple funds that have approached me where they basically say, Look, we want to do the pro rata share of seed funds later in the top 10% seed funds. And that's a smart model, because seed funds don't typically follow on a lot. But if you're getting deal flow from venture, you're getting deal, where are you based? Oh, yeah. So I would challenge you to tell me you're getting phenomenal deal flow in Ohio. I mean, I saw 8000 deals the fact

Marius Kreft 1:18:07
that I'm in Ohio, my ties, my ties are closer to the Bay Area in the valley than to Ohio, right?

Ben Narasin 1:18:16
But are you going there to get that deal flow? Are you getting them to send it to you? Because one is extremely draining and the other is extremely erratic, meaning, you know, 1000s and 1000s of deals to do one.

Mark Sanor 1:18:31
So my So,

Marius Kreft 1:18:35
my background is cyber security, so I know a lot of founders in that space. Oh, that's an awesome one. And the deal flow comes directly to me. They know me. I know them. So that's one case

Ben Narasin 1:18:51
that's totally you have the domain expert under relationships. That's awesome. The tricky part is, you know, how much can you invest through that in qualified folks. Don't give up on venture. Nikki about performance. I mean, you should, in theory, I've funded maybe half a dozen funds. And you know, I'm not interested in the story. I'm interested in the track record. And if you can't show me a track record. Now, I've missed out on some things because I chose not to invest because of the fact they didn't have a track record yet. But, you know, unlike mutual funds, where people can spin up 10 concepts last one, they have nine money losers and one winner. So they promote the winner as if it was awesome, and look at how great they are. You know, a venture fund is run by human beings, and human

Marius Kreft 1:19:40
beings only have one bottom line, venture fund, you know you were talking about the best deals. Look how much money has been going into AI. Is AI real? Absolutely. But should 34% of VC money be going. Into AI? Probably not. I'd be counter investing, looking for things that are not necessarily AI.

Ben Narasin 1:20:12
Yeah, that's I did. Was a robotics company to fight wildfires, but the best and brightest talent always go to the most exciting area, and right now that is definitely AI. So it is both probably as big as the web was, and is drawing in all the most talented people. So if you're founder centric, you'll end up doing a disproportionate amount of AI, just because that's where you're gonna get the best founders. Now the problem is, there's gonna be an enormous amount of blood, right? So you have everybody chasing everybody, and you know, it's sort of in the with the invention of the automobile in the United States, there were 2000 car companies. So it's very similar. Like, how do you figure out who's going to be Ford any day? Yeah,

1:20:51
let me ask

Mark Sanor 1:20:53
a different question. So we get more people involved. What does the valley think of energy today? Development is saying it's all coming down. Who's got access to energy? What? What? What innovations are we seeing in that front

Joe Azzaro 1:21:13
I'm sorry mark you say that again. Just

Mark Sanor 1:21:15
to look at, I'm looking for innovations on, on energy, other than, than, than better drilling.

Joe Azzaro 1:21:23
Actually, I think that they're drilling less right now and stating that they're going to drill less in the US, which is ironic, because at these prices, they're not. A lot of them won't be seeing the same return. So very interesting dynamic there mark the it goes against a lot of what the administration is trying

1:21:45
to do, also

Jeff Zawadsky 1:21:47
deep markets. It's hard to answer that question right now, because the framework is, you know, goes back to the BBB, the initial part of this, like right now, they're completely altering the incentives for work and energy, right? So you're talking about effectively undercutting anything that's renewable and going, you know, increased oil and gas, which, you know, you can argue the logic of that, given that we were producing as much as we've ever produced over the last five years. And you're talking about nuclear. Nuclear is great, small nuclear, but there's a very small world of folks who work in that and invest in that. So right now, until you have that framework locked down, that's a really hard question to answer.

Joe Azzaro 1:22:31
And Jeff SMRs are still, you know, for real, real applications still a ways out, right?

Jeff Zawadsky 1:22:40
Yeah, I mean everything, I just don't feel, I mean now, but it's an area that I've worked with, and I know some of the guys developing that, but, you know, it's, it's absolutely a ways out, and it's kind of pre the stage where, you know, tax incentives are going to help all that much, whereas, you know, kind of at the stage where you could mainstream a lot of renewables, but

Mark Sanor 1:23:05
we'll see what happens. And Jeff, we're going to see you on the West Coast.

Jeff Zawadsky 1:23:11
Yeah, you'll see me in the West Coast, for sure, at least in the Bay Area piece Seattle,

Mark Sanor 1:23:17
as much as I'd love to, there's going to be a it's it might be better even than San Francisco and the valley, okay? Samir,

Sameer Sirdeshpande 1:23:26
yeah. So about energy, I agree that the energy policy is completely messed up, right? It's great if you're oil and gas. Clearly they want to sort of promote that. I agree that there's a lot of opportunity being missed in renewables as a result. What I am seeing, you know, Mark to your point is, I am seeing investment in, let's say, how we use hydrocarbons sustainably, right? Bit of an oxymoron. But there are ways, there are technologies that we're investing in which take the carbon out of out of hydrocarbons, to just use the hydrogen and then to sell the carbon right? So those are, you know, some cases where even though the tax credits aren't there anymore, or zero carbon energy, we're still relying on the hydrocarbon infrastructure, which plays into what the administration is trying to achieve, while also achieving, hopefully, some of those sustainability goals.

Mark Sanor 1:24:19
Fair enough, Anthony,

Anthony Gordon 1:24:20
you're back. Hi. Look at VI last year, which is run by like named Burke. Jim Burke is the CEO. They just acquired new multiples may 16, so now they going to guarantee 2600 watts of power across nuclear, co solar, but mostly they got seven new natural gas positions. And last year, if you just look at it, you know, I'm a public that's my mania. But VISTA was up 262, last year, percent was compared to Nvidia at 179 and Bitcoin at 108, so that is being regarded. People are paying attention to that. Uh. If you talk about the future, my take, and I'm looking closely at helium on the moon, which has quantum potential, cancer and other benefits, in other words, mining helium on the moon, and I believe that's going to become defense critical.

Mark Sanor 1:25:17
How far out is that

Anthony Gordon 1:25:20
you mean, when is that deliverable? Uh, hold on. You want the exact amount. I think it's, it's several years. I think it's at least oh eight. So what do we now? We're oh five, five. So that's not that's 345, years away. I'm looking very closely now with a company where the CO one of the co founders, built the US Space Station, Glen Martin, I'm in New York. They're based in New York, and they're rolling. They have a team. They have a $1.2 billion commitment from the Department of Defense, but obviously they have to deliver on that. It's done robotically.

Mark Sanor 1:26:07
Yeah, Andy fish, thank you, yeah.

Andrew Fisch 1:26:11
So the the so called drilling, is basically two categories. There's the short term. We can just put more, put more holes in the ground, where we where we've got them, but oil, 60 bucks a barrel, you're down to a point where, I don't know if anybody cares about tax credits, because it's at $60 a barrel, there's not a lot of places you want to drill on the ground, the longer term so called drilling is, yes, they're opening up the Arctic and other public lands for drilling. But those are, those are long term projects. If oil was at 90 a barrel, you still wouldn't see anything for some time. So my point is the bottom line impact in the time frame that is relatively intermediate, we'll call it even in four or five years, is almost negligible. At $60 a barrel, it's zero,

Joe Azzaro 1:27:11
although $60 a barrel is a massive benefit for the global system. For consultant

Andrew Fisch 1:27:16
Stephen, from a macro standpoint, I just grow

Joe Azzaro 1:27:20
I want to do. We've been very Yeah, Steve, 100%

Andrew Fisch 1:27:24
I'm just talking about the drilling motivation is exactly zero, even with a tax change,

Mark Sanor 1:27:31
a new voice. If I could, can this? Can you? Can I ask you a question? I Yeah. Candice Beaumont, you may be just observing from a far okay, go ahead. Michael,

Marius Kreft 1:27:50
so I just wanted to jump in on the drilling discussion. Oil isn't the you could ask

Marc Rosenberg 1:27:59
me a question. Sorry about

Mark Sanor 1:28:00
that. If you don't mind, Michael, pause on that one, I'm sure, just curious. Candice, we've talked off and on, but you, you haven't been on this public forum for a while, but just what, what scares and excites you these days, we're talking about energy, but doesn't have to be about energy.

Candice Beaumont 1:28:17
I think, I think, I think, I think energy is, is a an energy is a great area. I mean, we, we historically, even, you know, the need for it with data centers and other things, the need for energy is just ever increasing. So I think, and there's a number of areas in energy that are that are interesting. We're not looking at a lot of them because we're distracted with other things right now. Sandra the Billy and I work with is really his father in law, just died of cancer and and it really kind of triggered him to look into ways to extend longevity. Um, so, um, so right now we're kind of, he's all in and CO investing with Sam Altman in an AI healthcare company that's, um, basically trying to solve Alzheimer's and extend longevity with a number of different initiatives. And Sam Altman's leading it with 150 million and 50 million, and will co lead with 50 to 100 so that's one of the investments that he's really excited about right now, in AI for health care. And I grew some of the early speakers, you know, I think AI, you know, if you can back the winners in AI, and that's, there's going to be a lot of money made there in AI. So, you know, co invested in a number of different like figure AI and a number of the other AI companies that are interesting. So I think that's something that's that's going to continue, you know, and I but I also think it's dangerous, right? I think dangerous. For and I think for society, if we go too much into AI or digital economy, if the wrong person, if the CCP gets control of that quantum computer, we could be enslaved in ways we never imagined possible. So I think regulating AI is also really important to make sure it doesn't take over, but from an investment mandate, I think this

1:30:26
could be a lot of

Mark Sanor 1:30:31
you're going in and out a little bit, but I got the gist of it. Thank you. Good themes, and then we'll come back on that the deal you're doing with Altman on longevity. Anyone else think it's Michael? Back to you. I just wanted

Anthony Gordon 1:30:49
to correct the date on the helium. It's 2030 not 2028, for delivery. 2037,

Mark Sanor 1:30:57
years. And what kind of volumes are we looking at, delivery of Helios big

Anthony Gordon 1:31:02
one second.

1:31:05
Wanted to be specific,

Anthony Gordon 1:31:11
potentially, it's a big number, 357,000 kilograms. Will will be needed by 2050 for fusion and quantum but that's not that wasn't your question. Your question was delivery. Current reserves are 29 kilos and 15 kilos of new production per year, ongoing from 2030

Mark Sanor 1:31:44
Okay, I'll later put that in perspective. It's very it's

Anthony Gordon 1:31:47
complicated. It is 1.1 million tons of helium on the moon, according to NASA, enough fuel for 3000 years of fusion power generation. Okay. Anyway, happy to talk about this further, extremely complicated and scientific,

Mark Sanor 1:32:06
handy fish. Did you take that into account in your various scenarios?

Andrew Fisch 1:32:11
He's talking about things like deuterium and yeah, we don't have the technology to actually use it yet. So when we invent the fusion reactor, then we'll leave the huge quantities of things like deuterium and helium to put into it.

Mark Sanor 1:32:33
Well, Michael AM, are you back to basics?

Marius Kreft 1:32:38
Back to Basics. So Andrew was talking about drilling. And I'm, like I've said in the past, I'm focused on the Utica. Even through the windows, I can hear the they're putting in a new pad about two miles away. And in this area, it's primarily natural gas. And while oil has come down significantly. Natural gas is still pretty up. So the peak recently was little over four. I think was about four and a quarter. Currently, we're a little over 370 but it's doing pretty good compared to last year and the year before, when it was down around two at Henry Hub. Drilling continues in this area. Prospects look good, but you have to understand, they don't just like start a well pad drill the wells put them into production. What happens is they'll drill a well, and they may wait to frack it, just holding it in inventory, and then go back later and FRAC it and put it into production. There's limits on the amount of pipeline capacity. I think pipelines are generally a good investment, whether it's oil or natural gas, you've got new terminals coming online in the in the near future. The upside to that is more export sales, the downside is more exposure to international market. So natural gas becomes more like oil in that sense. So

Andrew Fisch 1:34:21
Michael, you're absolutely correct. Remember, I said there's the camp of we can just put another hole in the ground. So if you look at Utica, you've got two things, you can put another hole in the ground. And two, you also have pipelines. You're completely correct about natural gas, a much better dynamic than oil, and it will be, by the way, because all the electricity needs will drive nap gas demand, even domestically, but it's gotta be near a pipeline, which Utica is, and once again, you're just putting another hole in the ground, not

Marius Kreft 1:34:54
creating a home. Andrew, understand they had to build those pipelines, and I was. Here when they were building a bright, Oh,

Andrew Fisch 1:35:01
I agree. I'm just, I'm just saying, Michael,

Mark Sanor 1:35:05
guys, let's we have, like, other people, just thinking of other, other questions that might be on people's minds. Mark,

Joe Azzaro 1:35:15
I have some that flew under the radar last week, but the Supreme Court stated a view which wasn't a ruling that Trump could fire some of the people he was trying to fire. But when it came to the Fed, they maintained a they had the view that the Fed is unique in constitutional terms, suggesting that it tends to maintain a carve out for fed independence as Pierce poised to expand greatly the President's ability to fire other agencies, but the Fed one for right now is pretty much been told to keep hands off. And I think that's going to be an interesting dynamic to see play out. But he'll go after other agencies, but I think he'll give he's moving now to where it's he's better off waiting on Powell, but I think that fear should be reduced, if not off the table for people.

Mark Sanor 1:36:10
Got it. Thank you. Anyone else with a comment or question? I had a question, then on on pipelines. Is anyone aware of the pipeline Russia is building to China? Any insights on that? Because that came up in a at a lunch yesterday.

Andrew Fisch 1:36:37
They're They're doing it because all the Arctic natural gas that the Russians produce as the special LNG and ice breakers that bring it up and around and down to China, and so that's where the sources in The North West, I'm sorry, north northeast of Russia, and it's just a way of avoiding the shipping that they're doing today.

Mark Sanor 1:37:09
But in a time of war, just as Nord Stream was disabled, bombed effectively, what stops the bombing of pipelines interrupting gas transport

Andrew Fisch 1:37:24
in a global war or

Mark Sanor 1:37:27
so, I had a really Singapore, mainland, China and London based X Singapore, Singapore discussing geopolitics. And they, you know, they're absolutely convinced that that in 2027 China will have the full capabilities to take over Taiwan easily. They make ships and bombs like chocolates. They were saying, and that they don't want war, but they're going to take what's theirs and they and what can be done against that dynamic. If you want to do something, the Americans will not put any soldiers in any harms way, and so that you should just plan for and, and there, within the discussion of the of the Ukraine, Russian war, you know, wouldn't it couldn't have been, you know, nice if we could make, make make nice. Any, any news on that, I don't see Adam Blanco, any, any news on the war. Germans are basically saying you can bomb anything, anywhere in Russia. Now, did you see that

Andrew Fisch 1:38:50
China's blockade Taiwan when their merchant fleet is large enough and their merchant fleet is built to military standards? So

Mark Sanor 1:38:59
that point I get, but I forgot this. That other point. What about the fact that Germans are allowing the that are allowing Ukrainians to bomb anywhere in Russia? There's no limits. Now, has anyone picked up on that?

Joe Azzaro 1:39:14
Yeah, Mertz came out with that today. Mark, I thought it was interesting, and that they're

Mark Sanor 1:39:18
there. Is that thumbs up. You like that? Or what's No,

Joe Azzaro 1:39:22
no, I'm I'm saying he came up with, he was out with that today, and I think it's a reflection of Europe trying to say that they're going to stand up regardless of what the US does. And I think they needed that message to be different, because I don't think Trump would have put that message out. So there's a push to stand up as if it's without the us going forward,

Marius Kreft 1:39:46
right? To paraphrase with less polite words, maybe we needed a bully to get finally cohorne as to our decisions. And I think we getting very well together. And let's hope that the next election in Poland. Will will also be to the right direction, then things will follow. So I say, good luck with the gas pipeline. Yeah, as long as there's no no peace deal is made.

Mark Sanor 1:40:11
Gunter just jumped on camera. Do you want to say something?

Olga Loy 1:40:18
Good sir, yes.

Günter Schmittberger 1:40:21
The main reason why Germany allows now to use long range missiles is to defend against the aggression from Russia. They only allow to bomb places where the rockets are starting, you know, rockets and so on gun

Mark Sanor 1:40:48
to do you mind introducing yourself to the community?

Günter Schmittberger 1:40:53
Well, I am based in Germany, next to Frankfurt. I am partnering with Joe Milan and some other American partners. I'm a fundraiser for impact oriented startups, mainly in Europe, Africa and North America.

Mark Sanor 1:41:12
Great welcome. Thank you. Hi. Go ahead, Anthony, go it's

Anthony Gordon 1:41:23
only appropriate that gun is from Frankfurt, and a week ago, you know, you raised it. You didn't ask Ray mental it's up 6% this week since the last meeting, and it's at a new all time high today of two and a half. And I gave it to the group at what 1100 and it's trading at 1889 now, and all in part to the war, to Germany, Ukraine, in part, not in total, in not in total, with 70% of the revenue coming outside of that, to most people's disbelief. But we have to admit, it's an absolute ballistic run. And you could argue that, and I didn't read this, this is what I'm saying. It's kind of like the mag seven of Europe. But no one said that yet, but they will. It'll come out soon, and we're up 212% year to date on Ray metal, and 250 4% in where is where is it going to be in a week? And a week, it's clearly going over 2000 and very quickly,

Mark Sanor 1:42:28
okay, Mayor, I don't know.

Maher Nasri 1:42:32
Well, there is a deep analysis regarding the issues going on in Europe, in my perspective, like, you know, when American Now Trump, I feel is more rational as to say, let's settle down. Because, you know, we know that all the war is coming under the day, to the table, back to the table. You know, there's no, no other solutions other than back that the table. But end of the day, I feel like I'm

Mark Sanor 1:42:58
missing that word mark, back to the what? Yeah, everybody

Maher Nasri 1:43:00
say, after the war, end of it is everybody's back to the table on closing the issues. The point is, like, you know, burning more resources, cutting funds from the people's life. That is what I feel like people are. Some people drive, driven with this in order to keep more harm in Europe, which I feel bad for it. Bear in mind, a Russian economic maybe you can trust it or not, has been increased like there's a growth out of one or 2% last year. Maybe that's wrong or bad. But I'm in touch with some people, my friends living there, they said things are settle down. We don't have any hardship. Everything's normal. We barely we are making living. We are covering our cost, and we don't have any hardship. Having said, that is China, and the other side is not acting 100% side with Russia, because there's, I just post, there's a lot of mineral resources discovered in the China Sea at the moment. So things are developing. China is always acting, as we said last time, strategically for her own interest, for Chinese interest of anybody else. So having said that, as like, you know, I feel like you know, Trump is I trust Trump that say, when he say, settle down. Enough military complex, you know, fueling all the money into Europe and keep the war the fire is, you know, oil to the fire. That's something. Is what I just want to address. Thank you.

Olga Loy 1:44:35
Well, it's 1220,

Joe Azzaro 1:44:37
Mark. I want to leave one last thought, which is what I started with. I think the debt problem around the world, which we used to say is down the road, is getting a lot closer. And I think people need to really focus on the areas they're investing in, the debt levels, whether it's countries or companies, because the bills come and do and you saw you're seeing it with a. And Japan, Japan is starting to we're going to have to get buyers for the debt, and the buyers are not going to buy without a higher rate. And I think that's going to push rates up and make all our investing approaches more difficult. And I forget who said it earlier, but the focus on quality in the venture, I think you're going to need to focus on higher quality throughout as we're going to be pressing up with the rate structure around the world, because the debt burdens.

Mark Sanor 1:45:28
You mean, it's going to be about stake and ethicism. I

Joe Azzaro 1:45:31
think we're getting back to way before 08 investing, before we went to zero rates. The

Anthony Gordon 1:45:38
I mean, Jeff, Japanese bond investors have lost, what, 25% in a couple of weeks. But just on that, Stephen, could you just in closing here elaborate, because I think you've hit it, and you've been, you know, talking about this for a while, but this, it's not just us. It's a global rate problem and how that parlays into the stock market, where the question is, what catalyst is there? Because we've all been glued and addicted and lulled by the SMP meteoric decade of rise. But what catalyst, if any, can maintain that? And maybe the right question is, what prevents that from not just going sideways, but in fact, having more than a hard fall, which, in my mind constitutes, you know, when you're down high teens into the 20s from here, then that has a real pain. And so, you know, earlier, there was that rotation out, and then last week, and you were saying how you thought and before how you thought that was just temporary, how capital would flow back into the US and into the SMP, which it seems to be. But what I'm my question is, what's the the setup for things either to work or for it not to happen? So how does it all recalibrate? Anthony,

Joe Azzaro 1:47:01
to your question, I think the debt problem pushes people to focus on changing their discipline, because we didn't need much discipline for the last 15 years as investors to make a lot of money, and now you do. So I think the debt problem leads to better fiscal discipline, which is going to push people to be more productive. And I think the productivity side, the what excites me is the productivity opportunity ahead of us, and it's the ability to capture that that's going to offset some of these challenges, and in the US alone, if we move to better productivity growth, you could see us jump from one and a half to 2% growth to 3% growth here, and just picture every country getting a little bit of productivity improvement would go a long way to offsetting the debt burdens and getting you back on a more sustainable path to offset the problems. And I think that's really where the the ying and the yang are. You have the debt problem on one side, you have the innovation on the other that's driving the productivity improvements, and it's just a question of you need the impetus to get people out of the complacency that they're in, that don't worry about it. The Fed put will come in, or the Trump will put will come in, or some other central bank will bail you out, or there'll be a big fiscal stimulus. And I think we are pushing the limits on all of that, and now we're getting back to where you're going to actually have to deliver on productivity improvements to drive the economies forward.

Anthony Gordon 1:48:26
Now that's the number. Besson said, 3% right, sooner than later. He's very clear about that when he was interviewed last Friday. Well, if you

Joe Azzaro 1:48:37
get it right, he's been on that for a while, but if you get it right, you can, you can drive productivity up, but you gotta, you can't waste money. The way, zero interest rates allow you to waste money. And I think everyone's got it going to have the discipline. But for us, we always start with there's three things that go matter for security valuation. One is the outlook for earnings, the outlook for interest rates, the outlook for inflation. The outlook for inflation is muted. The outlook for interest rates is, I think, range bound, plus or minus around here, and the outlook for earnings is struggling right now. But for the companies that you have clarity, you can make some good money. And I think that's the way people have to step back and look at

Mark Sanor 1:49:18
it. Now. I was just about made. This is sort of a wind up comment. Marius was asking, do we record these? Well, hell yes, they're all They're always recorded, you know. So the video you can see from last week, which, you know, you can go to our we have a YouTube channel. We don't promote it very much, but it is. There's Anthony right there, but you also have transcripts which you can get on the digest, and actually it's in the body of the description of YouTube, but right here, I think this is the fascinating bit. Or you. You can see who's who said what, when, or we have podcasts on Apple or all your channels. So if you didn't know, he asked. So I can't believe how many we have, 676

1:50:18
episodes,

Joe Azzaro 1:50:21
not more feels like more

Anthony Gordon 1:50:23
to be right, 51% of the time. Stephen, and you're a genius,

Joe Azzaro 1:50:29
you know, Anthony, if you if you look at Rafael Nadal, won 83% of his matches and 53% of the points in the games he played. So yeah, that mine for investing too, because you got to be right overall a lot more, but you're not going to get it right every day 50% unless you're

Mark Sanor 1:50:51
unless you're on the wrong side of a short. Yeah, there's no such thing as a short and tennis, I'm just saying having taught tennis for three four years, but I.