Right.

And the bank, this is a very interesting topic for the banks as well because let's be very clear, all these financial institutions do a bunch of different services for you.

They do make a lot of money on the cash.

Banks, you put money in a checking account, they lend it out.

They keep the spread.

Same thing, there's some lazy cash.

Remember, there are $4 trillion sitting in checking accounts, bank accounts in the United States earning zero, and then there's a whole nother couple of trillion earning only a little bit.

Right.

Okay.

They're just flat out wrong.

Um, it doesn't mean there couldn't be slowing in different products, but let me just give you a, a...

For instance, 86% of companies in the United States with 100 million or more of revenue are private.

They are pri- staying private much longer than they ever were before because they can continue to finance in the private markets or by banks in ways they couldn't before, and the lending spreads are pretty tight.

So you don't need to go public and deal with idiots like us if you can finance yourself and grow your business without having to add on that cost and annoyance.

So a- and then mutual funds have overnight deposits.

Yeah.

big ones, who do you think's been hurt the most?

It ebbs and flows.

I would say that if you look at the multiples that some of the companies trade at, Carlyle had a period where their private equity returns were waning a little bit, and their return of capital was hurting, and that hurt their stock price.

And now they've actually improved performance right about to what I would call the Mendoza line.

These companies think 2 and 20 above an 8% hurdle, meaning they'll charge a base management fee.

They'll get 20% of excess returns over a hurdle rate, usually in private equity, and then it's 8%.

So the client is more than happy.

expected.

I'm going to raise so much capital that I should trade off lower fees for more volume and play the volume game.

It's complex the way you laid it out, and I think there's other levels of complexity about what product you are providing to which client, even what the waterfall of deal flow and what clients get access, whether it be a big institutional LP, the co-invest that goes along with it, the semi-liquid products that are drawing from that.

We could have a couple of podcasts just on that topic.

But no mistake about it, I remember I've covered these companies since they've been public, and I took note of Blackstone being very early in their thought process of bringing their institutional products to the wealth channel and saying everybody should have equal access.

And there were many years went by of them showing signs of success and building, and I would go to some of the other companies and say, hey— You see what they're doing? Should you be thinking about that? And the early comments were, I'm not sure I want to be taking retail money.

And I think everyone has come along with they were right and we have to play catch up because There's $140 trillion or so in institutional money with anywhere from 20% to 50% allocations to private markets.

And over here, there's about the same $140 trillion.

What do you make of that? And do you think we'll continue to see more firms, Brookfield talked about this too, either becoming more of an insurance business or want to transform themselves into more of an insurance business as a way to fund much of their private markets activity? Is this the direction of travel that we're just going to continue to head in private

What do the good CEOs have in common? What are the lessons here?

So, first of all, it's a near impossible job, given the size and complexity of the companies we cover.

But it is what it is.

We all put report cards on them, so I'll answer that question.

You have to be great at a lot of things, right? You have to build a team around you and give them enough room to grow and be great managers on their own, yet hold them accountable and have reasonable goals that you...

communicated out to the world.

And so there's pressure to perform.

Morgan is one of the best at doing that.

Who is at an advantage in a market like today and who's maybe at a disadvantage if they're more indexed towards a certain asset class or strategy?

So I love this topic.

And yes, I read it.

I read everything you do.

So look, when I 30 years ago started on the sell side researching the traditional asset managers, this was a foreign concept because if an institution ran an RFP that was going to do a search for a small cap manager, they would look that's all the best small cap equity managers they run a process they do some finals they run an rfp and then they pick one two three whatever it is of the best ones and they'd allocate money and then that would fit in that style box and then when they want to go do a large cap value they would do the same process and it was a product by product performance and process win one at a time and so Over time, you would hear companies talk about solutions and bringing a set of solutions to clients and helping them with their outcomes.

And so there's room for both in the world.

There's still product by product picks best manager.

What are you seeing happen from... banks in that context as they look at all these alternative