Rest in peace, Daniel Kahneman passed away today he was a psychologist who won the Nobel Prize in Economics for his work. In the really important book Thinking Fast and Slow. One of the big takeaways from that book, like, which I like to reference quite a bit, is that 90% of our financial decision making is driven by emotion. I always like to ask people kind of let that wash over you. Do you think that you make the vast majority of your financial decisions based emotionally? Remember, the first time I heard that I was like, No way, there’s no way that that’s true for me. But I thought about it a little bit. And like, yeah, I make most of the decisions I make just because of emotion. It’s because the way that I feel about things, the way that I dress, the way that I act, what I eat, what I buy, just whatever, it’s all based on how I feel about things. The trick is that once you recognize that you’re making a lot of your money, decisions based on emotion, then you can become aware of them and start to then make more logical, rational decisions about money, which is where we want to get to. So Daniel, Danny, also, he also has a wonderful quote, about my business, about the industry about the financial services industry. He said, This is an industry built on the illusion of skill. It’s like whoa, shots fired. Danny Kahneman, taking direct aim. Bullseye, the financial industry, I mean, that’s such a damning indictment of of my industry. It’s a business that has so much unnecessary complexity, so many fees, so much profit, not a lot of results, out a lot of results. I’ll let you ruminate on that one a little bit. Another great quote comes from President Ronald Reagan. Also rest in peace. He told this long joke. And the punch line was with all this manure, there must be a pony in here somewhere. said there’s a lot of bullshit going on. Why don’t just piles of shit everywhere. There’s got to be a pony in here somewhere, doesn’t there? Does there need to be a pony in here? Somewhere. Kind of also reminds me of the emperor has no clothes kind of a thing? It’s directly going towards Danny Kahneman ins. Thoughts on the financial just industry in general. Not a lot of substance. Got all the money? But not super sure why. So that was? That’s a real Zinger. What made me think about both of those was when I read Larry Fink’s 2024 letter to the investors, have you seen it? Have you seen the letter, it’s been all over social media, it’s making the rounds. BlackRock CEO says concept of retirement has to change. Here’s a, quote, humanity’s changed over the past 120 years, so much. So must our conception of retirement. Fact the time though, the the title was time to rethink retirement. That is a tongue twister right there. In the letter, he covered a lot of ground, he calls on governments and industry leaders to come together to solve this big problem. And I promise for sure that I’m not going to read all of it to you. But I want to read a little bit about it. I doubt sort of has the feel number one thing is over 11,000 words, that’s a giant document, that it’s giant. So it kind of reminds me of the bills that our government likes to pass now, where nobody has any idea what any of it says they’re so voluminous that nobody’s going to read them or even be able to read them. If he did read them, you probably wouldn’t be able to understand it. But I did read it. And I didn’t intend to. But in reading some articles about I thought, You know what, I should just read this thing. So I’m going to spare you from, like 10,500 words of it and just read you the opening and the closing. Because I think that that’s where the meat of it is. That’s where the value of it is. That’s where the pony is in the letter, just the opening and the closing. So bear with me. I’ll read quick, out of their time to rethink retirement. When my mom passed away in 2012. My dad started to decline quickly and my brother and I had to go through my parents bills and finances. Both my mom and dad worked great jobs for 50 years. But they were never in the top tax bracket. My mom taught English at the local state college and my dad owned a shoe store. I don’t know exactly how much they made every year. But in today’s dollars, it was probably not more than $150,000 as a couple. So my brother and I were surprised when we saw the size of our parents retirement savings, it was an order of magnitude bigger than you’d expect for a couple making their income. And when we finished going over their state, we learned why my parents investments. A dad has always been an enthusiastic investor, he encouraged me to buy my first stock. As a teenager, my dad invested because he knew that whatever money he put in the bond or stock markets would likely grow faster than the bank, he was right and went back and did the math. My parents had $1,000 to invest in 1960. And they put that money into the s&p 500. But then by the time they’d reach retirement age in 1990, that 1000 would be worth nearly $20,000. That’s more than double what they would have earned if they just put the money in a bank account. My dad passed away a few months after my mom in his 80s. Both my parents could have lived beyond 100 and comfortably afford it. Why am I writing about my parents because going over their finances showed me something about my own career in finance. I’d been working at Blackrock for almost 25 years, but at time I lost my mom and dad. But the experience reminded me in a new and very personal way, why my business partners and I founded Blackrock in the first place. Obviously, we were ambitious entrepreneurs, we wanted to build a big successful company. But we also wanted to help people retire like my parents did. That’s why we started an asset manager company that helps people invest in the capital markets, because we believe participating in those markets was going to be crucial for people who want to retire complete and financially secure. We also believe that capital markets will become a bigger and bigger part of the global economy if more people could invest in the capital markets that would create a virtuous economic cycle. My parents lived their final years with dignity, and financial freedom. Most people don’t have that chance, but they can same kinds of markets that helped my parents in their time can help others in our time. Indeed, I think the growth and prosperity generating power of the capital markets will remain a dominant economic trend. Through the rest of the 21st century. This letter attempts to explain why sets the opening the closing is much shorter bear with me. Over the past 36 years Blackrock has grown from a company of eight people and a tiny Manhattan office into the largest asset manager in the world. But our growth is just a small part of a much larger success story. It’s part of the same story that includes my parents retiring comfortably after 50 years of hard work the same story where America was able to endure the 1980s SNL crisis 2008 financial crisis and rebound quickly with growing strength. And it’s a story that hopefully will include more people around the world, nations that can outgrow their debt, cities that can afford to power more homes and build more roads, workers who can live out their golden years with dignity. All of these stories are only possible because of the power of the capital markets that people who are hopefully hopeful enough to invest in them. So there you go, that was the opening and the closing of the letter that was over 1000 words. He talks a lot about the capital markets, talks about infrastructure, he talks about government debt, talks about how the, what he perceives to be the problems with retirement the way that we are today, people living longer, healthier lives through innovations in medical yet not having enough money to able to support a longer duration of being retired. So talks a lot about how the capital markets he believes are going to be the solution to a lot of those problems and some different ways that his company or financial companies can help to facilitate that. So there you go. During the 2008 financial crisis, I was working for a large Life Insurance Company. They did a great job of marketing of creating marketing materials that really resonated. One of my favorites. Were sure my favorite My favorite was a poster that said, we’re Main Street, not Wall Street. And I think that that kind of sums up my philosophy. I am a bottom up versus a top down kind of person. I am a personal responsibility, self reliance, power of the individual kind of person. And I bet Larry Fink the CEO of Blackrock used to be that too. Back in the day when he was talking about eight people in a tiny Manhattan office starting Black Rock. But not today. Not anymore. Now he’s top down. In fact, he is personifies top down. He’s big business. Big Government. kind of guy. Good for him. Not good for me. Is it good for you? You just died.

Got a B, there’s gotta be a pony in here somewhere, doesn’t there? Yes, yes, yes, yes. It was the story about his parents, that was the pony. And those 11,000 words, that was the pony was a story of his mom and dad, if instead of taking those 11,000 words to say what he did, he had just taken the 500 words, or taken an additional 500 words, to describe in great detail, how his parents managed to do what they did. scraping by not scraping by but living modestly, living a middle class existence as a teacher, and an entrepreneur, a guy that owned a shoe store, and how they were able to save enough to retire comfortably. And like he said, his dad passed away in his late 80s. But they would have been fine, even if they had lived past 100. How do they do that? How do they do that? It’s as though he was saying that, yes, they did it. But in the 36 years that I’ve been building BlackRock, now, people can’t do it anymore. Well, that’s weird. Isn’t that weird? Like that. So if he had just described that, I think that that would be immensely valuable. That’s a story that I want to read story that I want to just learn from, how do they do that? You see, Larry’s parents did it. But now it seems that he doesn’t think that you can do it. Now, it seems the only way the ship is gonna get righted is if giant companies and governments take massive action. That sounds crazy to me. Does that make sense to you? Are you waiting for Blackrock to come and save you? Do you think that Blackrock is gonna save you? Would you like Blackrock to save you? This is one of the companies that is altering the American dream, isn’t it? Isn’t BlackRock, one of the companies that’s altering the American dream? You know, the American dream about home ownership? You remember, remember that MetLife Investment Management estimates that institutional investors may own 40% of single family homes by 20 3040 percents, almost half. But wait, that’s not BlackRock? Right. Here’s a quote. Bottom line. BlackRock is an active investor in the United States real estate market. But we are not among the institutional investors buying single family homes. Oh, I must have had a confused. I must not have my story straight. Sorry about that. I apologize for misspeak in a moment ago. But well wait. Are BlackRock and the Blackstone Group connected? Because it wasn’t black rock that was buying all the single family homes? It’s black stone, not Black Rock? Black Stone? Not Larry Fink, Steve Schwartz, or Schwartzman. I forget. The answer to the question is Black Rock and the Blackstone Group are often confused as they share similar names and origins. Founded in 1985, both companies fell under an umbrella company called Blackstone financial management, a mergers and acquisitions company in 1988, Blackrock separated from the parent company and focused on risk management today, they’re now completely separate companies with different offerings. Oh, got it. Just wanted to make sure the company talking about how we need to come together to reshape retirement wasn’t working to make sure the biggest source of Americans wealth, homeownership was no longer possible for most Americans. Glad to clear that one up. So much fucking fuckery so much. Who is this great scene in The Social Network in the Facebook movie, great movie. Love that movie, where the Mark Zuckerberg character is being deposed. Finally, cracks, says he snaps says if you were the inventors of Facebook, then you would have been better at Facebook. Well, I’d like to say this. If Blackrock or Vanguard or statestreet, or XYZ company, were capable of helping you to become financially successful. They would have been helping you to become financially successful. But here Are we are, you know who’s financially successful? BlackRock, Vanguard, State Street, all these other massive financial companies, they have all the money, you don’t have much of it. That’s kind of the whole point of this whole deal. Here we are. The solution lies within you. Not BlackRock, or some other fucking financial company, just like Larry’s parents successfully saved and eventually retired. So to can you don’t wait to rely on anyone else to do anything for you, or to give you permission or to give you the secret? start relying on yourself, your family, your your loved ones, your community, work to support those people that you care for start at the grassroots, bottom up, not top down. That’s how change has always been made. And how change ought to and best be made. What problems are solved by giant corporations? What problems are solved by giant government? Hmm. I’ll give you a moment to think about that. What have you come up with? Don’t believe the hype. Whatever the appropriate term is. Larry’s parents did it. You can to rally reminder, never going to be anybody more interested in your financial success than you are. So act accordingly.