Steve Slifer

Steve Slifer: The rivalry between Lehman
and Goldman goes back to those 1850s.

Here's 150, 160 years of this rivalry.

Now you have a chance to stick
it to one of your competitors.

You take it?

Is that the right thing to do?

Welcome

Rodney Lee Rogers: to
the Pure Theater Podcast.

I'm Rodney Lee Rogers and that
was economist Steve Slifer.

Longtime Pure patron.

Been around almost from
the very beginning.

So goes back all the way
to the cigar factory.

We're up with the Lehman Brothers now.

Went in a conversation with Steve, learned
that he actually worked for Lehman.

Perfect conversation about
the culture at Lehman.

And what it really means to be an
economist, as Steve says, we're all

economists one way or the other.

So without further ado, Steve

Steve Slifer: Slifer.

Rodney Lee Rogers: Beginning almost,
do you remember, was it Cigar

Steve Slifer: Factory?

Uh, yeah, oh yeah, I remember the
Cigar Factory, and then the little

shopping center, and the church,
and all of these kind of things.

Do you remember the show?

Can't remember which one, which

Rodney Lee Rogers: Yeah, well it was,
that was such an interesting time.

Have you been back to the Cigar Factory?

Steve Slifer: Oh, yeah.

Oh, what a wonderful place.

It's amazing what they've done.

Garden and Gun has their headquarters.

Mayor may not know.

I didn't know that.

And, uh, so I've been over to visit them
and I was just trying to figure out how

I could get a job at Garden and Gun.

I just love, I just love the place.

Yeah.

It's wonderful.

They've done a wonderful job.

I would

Rodney Lee Rogers: have loved
to have been able to stay there.

I just love that area and that
building is so fascinating.

I would have loved to have stayed.

Once.

Once it sold there, you know, it upscaled.

I'm trying to remember
the first time we met it.

You go all the way back.

I go back along.

I think probably even the first year.

When you came in 2003,
where were you coming from?

New York City.

Steve Slifer: Yeah.

Been been working for
Lehman Brothers retired.

Thought I was gonna retire.

That lasted about six months.

Retirement is a concept that is
grossly overrated in my view.

It just.

Extremely boring.

I can't see it.

Yeah.

And there's a whole generation
of men who can't wait to turn

65, so they're gonna retire.

Yeah.

And uh, you know, in the old days
you would retire at 65, but when

social security was first adopted
retirement, you, you would die at 67.

Yeah.

So you were around two
years and you croak, right?

Yeah.

But now retirement age hasn't
changed much, but now you're

going to live to be 85.

Do you just really want to sit on your
butt for 20 years of your lifetime?

Is that what it's all about?

Rodney Lee Rogers: I can't imagine that.

I really can't.

Like I, like when we, we talk about it,
it's not even a concept I embrace at all.

It's like, it's like, yeah,

Steve Slifer: it's changing, but
I mean, I think there's a whole

generation of men who can't wait to
get there, to get to that age and they

think their life is going to change.

Yeah.

But then the question is, what do you do?

Yeah.

And then you'd say, well, uh,
I'll start a little business.

Oh.

And you think you're going to retire?

Not, you're not going to have a
very good business if you do that.

Yeah.

Well, I want to give back.

Oh, right.

So what's that look like?

You're going to run a nonprofit?

Seriously?

Yeah.

Serious work.

Yeah.

That's, that's just not
something you're going to do.

But I don't think men have figured it out.

Yeah.

And for me, That's what I
thought I was going to do.

I was going to play.

I was going to run and play tennis
and golf and do all these things.

And I just got bored.

But then along came the recession
knowing I was an economist people.

What do you think?

Well, what do you think?

Well, I don't know, but that sounded
sort of like a business opportunity.

So I kind of run around now
and just give a few speeches.

Basically, I do all the things I
was doing at Lehman Brothers, but

at my page, not at Lehman Brothers.

Right.

And so it's fun.

It's still great.

Here I am.

I'm getting to be an old fart and
I'm still enjoying it thoroughly.

And I keep thinking, well, I
ought to be giving this up.

And then I kind of go, why, isn't

Rodney Lee Rogers: that
sort of what it's about?

And so, and do you, do you do
this on like a national level?

You kind of go all over?

It's

Steve Slifer: mostly, it's, the answer
is mostly local, state, southeast.

But I'm not trying to build a business,
I mean, I'm past that I'm, to me, I've

got some knowledge that I've accumulated
over the 50 years I've been doing this.

And I kind of want to pass along some of
that stuff to others, younger generations.

And so, you know, if I can make a
few bucks out of it, that's fine.

Yeah.

You ever thought about teaching?

It's not all

Rodney Lee Rogers: about money.

Have you

Steve Slifer: ever thought about teaching?

Teaching is okay.

I do a couple of little classes every
now and then, but not as an, not as

an adjunct professor, just somebody
invites me to talk to their class

about what it's like at the Fed.

And I love the Fed.

I really enjoyed those years
at the Federal Reserve.

I love that.

What it's, what's it
like to be an economist?

What do you, how do you sort
of get the training you need?

What does an economist do?

Um, so I enjoy that.

I enjoy interacting with with some
of the students, but teaching I

tried the university of Phoenix.

Yeah.

All of a sudden they wanted me to
just kind of teach to the textbooks.

That's not what I bring to the party.

So I bring some experience.

Let me share that, but give exams.

Oh, thank you.

But no, thank

Rodney Lee Rogers: you.

Yeah.

That type of learning.

I just hope that's on its way out
because it is so The experiential, like

the experience you have is what you
have to teach more than anything else.

And anybody, I mean, just like
you personally, but everybody,

that's what people want.

Steve Slifer: When I, when I go to see
some of these kids, I go, okay, so how

many of you want to be an economist?

silence, nothing.

Well, what if I told you, you're
all going to be economists,

whether you like it or not.

I'll think about it.

I mean, you run a business, you care
about what's happening to the economy.

If it's in a slump, you've got a problem.

You care about inflation.

You care about interest rates.

You care about whether you can
get employees all in economics.

You just don't think of it in those
terms, but you're going to use it.

You'll talk about it with your
parents, your friends, your co workers.

You talk about it all the time.

Everybody's an economist the way I see it.

Rodney Lee Rogers: Well, if
you don't think about it, it

thinks about you, doesn't it?

Well,

Steve Slifer: that seems to be true.

I want to go

Rodney Lee Rogers: back to,
you said you love the Fed.

Tell me, what do you love about the Fed?

Steve Slifer: I was a kid coming
out of the University of Maryland.

The Fed hires PhDs from
all the named schools.

The Harvins, the Princes, that way.

So I snuck in the back door.

I guess they took me because I graduated
from the University of Maryland kind of

close by right there in College Park.

But in school, what do you get?

You get all that little theoretical stuff.

The Federal Reserve does not
operate in the theoretical,

they operate in the real world.

So somehow they taught me how to
take all these little things that

I learned in school and apply
them to what they were doing.

And then here I am, I'm a young kid
coming out, just joining this group.

They gave me an opportunity to
brief the Board of Governors.

These are the guys and women
who are setting interest rates

throughout the whole country.

This was a powerful group of people.

It was Paul Volcker and Arthur
Burns and all of these folks going

back, you sit down in the same room.

They're at one end of the table
and the little team of economists

that briefs the board every week
is at the other end of the table.

So I know what I said and I know
what the guy on my right left said,

so I knew everything that they knew.

And then at the end they raised their
hands, aren't going to raise rates.

And you go, ah, I kind of
know why they did that.

It gave me, a young kid, some real insight
into what I call sort of Fed think.

What is it that drives these people?

That was my first job
out of school, Rodney.

I mean, how lucky could I have
been to have gotten that position?

It was wonderful.

It was exciting.

The Fed would raise rates and I'd go
home, see mom, that was, that was me.

It was, it was an ego trip.

It was fun.

Um, those people were some
of the smartest, brightest

people I ever ran across.

I mean, they just taught me everything.

They got my career just
off to the right start.

Where'd it go from there?

Went to, well, went to,
went to Wall Street.

Right.

I'll give you another, one more
story about Oh, as many stories

Rodney Lee Rogers: as you got,
that's what we're here for.

Steve Slifer: I'm doing, my job is to
do the money supply, just for Europe.

What's the money?

It's just a measure of liquidity.

It's what the cash you got in
your wallet, what's in your

checking account, money funds.

That's it.

It's just a measure of liquidity.

My little job, put out those little
numbers every Thursday night.

And it used to be that that was important.

And the markets would come out at 4.

30 on Thursday and the
markets would go crazy.

My job.

Late 79.

Inflation is double digit.

Paul Volcker is the head of the Fed.

They were targeting
interest rates at the time.

He could see that interest rates
were going to have to go to 20%.

If you're the Federal Reserve and you're
controlling interest rates, and interest

rates go to 20%, who's the bad guy?

You are!

We got to change this.

We can't do this.

We're not targeting this anymore.

We're going to target the money supply.

Well, he neglected to tell
me what he was going to do.

Nobody at the Fed knew exactly how
to sort of target the money supply,

but we spent six months learning.

So the markets now
suddenly, they like to know.

I think they know how the Fed thinks.

This was totally different.

I've never done this, but it was my job.

I have often joked that that was the
Steve Slifer full employment act of 1979.

It was just fun.

Again, Sherlock, right place, right time.

Um, that's kind of moved me to Wall
Street and I spent most of that time

after that with Lehman Brothers.

That was exciting.

I enjoyed it thoroughly.

What do

Rodney Lee Rogers: you do?

Because everybody, and this is
like coming from a standpoint of

an artist who doesn't really know.

I've known many people
to work on Wall Street.

I hear that term over and over.

What does it mean to work on Wall Street?

Steve Slifer: It depends
on exactly what you do.

This is relevant to, you Play.

Mm-Hmm.

, you know, Lehman Brothers
investment banking firm, but they

trade bonds, they trade equity.

So you have traders, you have salespeople.

So they're telling their clients
sort of what they're supposed

to do with equities or bonds.

And then they have investment
bankers whose job is to work

with companies and say, gee, we
need to raise X amount of money.

How are we gonna do this?

Do we once wanna issue stock?

Do we wanna issue bonds?

So it's all about sort of how
companies are going to finance it.

It's about trading and when, when
one of these Wall Street firms is

trading, there's risk involved.

Um, but it's exciting.

So here I am a kid coming out of the
coming out of the federal reserve and I

get plunked down on this trading floor.

It's huge.

And there's this noise that people just
screaming and yelling back and forth.

Well that was sort of
exciting and it was fun.

Here's my job.

I'm not a trader.

I'm not a salesperson.

I'm not an investment.

I'm an economist.

So I'm not.

In one of the major areas of
the firm, but the information I

provided to all those people was
important to them or their clients.

So I kind of benefited all areas
of the firm, so they plunked

me down in the trading desk.

So the idea was when all, any of these
little economic indicators come out,

whether it's GDP or the consumer price,
whether I've made a forecast to this

and I'm right, I'm wrong, the home
team making money off of my forecast,

losing money off of my forecast.

That's pretty heady.

That's fun.

That's like being at the
blackjack table all day long.

Yeah.

Okay.

That's, that's good.

And I guess they must've been winning more
than losing because I still had a job.

So that was a good thing,
but it was exciting.

And even if it wasn't any of my economic
numbers, all of a sudden there's a

buzz on the other side of the room.

Go, Oh my God, Oh my God,
what's that all about?

And it was just truly exciting.

I thought I'd be there five years.

I thought, well, I'll make a
few bucks and then I'll leave.

I couldn't do it.

It was just so much fun.

I was having such a good time.

One year just kept leading to
another, to another, to another.

And all of a sudden you're
past 20 some years doing this.

It felt like a calling.

It was the excitement that I think
it was the excitement and the people.

I loved the people.

Um, and they would basically, I'd go
around a couple of times around the

world, two times to Europe, two times
to Asia, a couple of laps around the US.

And I'm going in, in all of these people,
telling my story about what I think is

going to happen in the United States.

The salespeople would
just take care of me.

I used to love to go to Europe in February
because I'd start in the Netherlands.

Why?

Because there was a, there was a
lady there who was a salesperson.

She was married, had a couple of kids.

She invited me over to
the house for dinner.

She took me skating on the,
on the canals in Amsterdam.

It was just fun.

She didn't have to do any of that.

These were just genuinely nice people.

And so I, I thoroughly enjoyed the
whole time I was there at Leaders.

You got to see a lot of the

Rodney Lee Rogers: world too on top

Steve Slifer: of it.

I got to go around the world
and it was, it was wonderful.

So there,

Rodney Lee Rogers: and, and, and
correct me if I'm wrong, there's this

real predictive nature to what you do.

Like you have to predict
what's going to Yeah.

Steve Slifer: I make forecasts
of some of that stuff, yeah.

And how I make forecasts
of a lot of stuff.

How do you go

Rodney Lee Rogers: about

Steve Slifer: that?

Oh, that could be, that's
a really long discussion.

Much longer than what we're
going to talk about here.

It's kind of history.

Think about it this way.

I mean, economists, when you're
coming up with a forecast.

You're looking back, well, over the
last 20 years, you know, when the

world has looked sort of like this,
here's what's happened to the economy.

Here's what's happening with Asia.

So you get, and you build little models,
economists love to build models and

you go, well, back in 1978 when the
sun and the moon were all aligned,

you know, this is what happened.

So your model spits out something.

The problem is.

The world has changed over that
period of time, and now it seems

to be changing even more quick.

So the models might be a place to start.

That's kind of okay.

But there's judgment in this.

I mean, in the end, it
comes down to judgment.

What's your sense?

Um, and that's where I think
the years of experience that

I've had perhaps differentiate
me from some of my colleagues.

The other thing that personally I
feel like I'm talking about me here,

but well, that's why you're here.

But somewhere along the line, early in
my career, somebody said to me that if I

can't explain this And I think that has
really proven to be this great advice over

the years that just seems like the one
common denominator of feedback I get is,

well, you were able to break that in down
in the terms that even I, an actor, even

whatever, somebody who's not involved in
the financial business can understand.

So that's the goal.

That's what I try and do.

Do

Rodney Lee Rogers: you, and
I, I just can't, uh, resist.

Where are we now?

Like, if you look at it, do you, if
you look at like now where we are

and where we're headed, it seems, I
mean, it's always seen, I think it's

like everybody always looks back
and goes, it's the worst time ever.

It's the best time ever.

It does seem particularly
strange right now.

Is, is that

Steve Slifer: accurate?

It is strange.

Yeah.

Things are changing fast and, and
not to mention the fact we were in

a political year, so you got all the
political spins, but nobody, nobody

can sort of, Put that into a forecast.

How do you know what's going to happen?

Who's going to win in November?

Who are the candidates going to be?

Who's going to win?

What kind of makeup do we have?

So that's, that's a
whole nother wild card.

But right now, as I look at the economic
things, I think we're doing okay.

Not to say that the economy
is going to be rip snorting,

but it's going to keep going.

We've gotten to the point where
Interest rates have stabilized

and look like they're going to be
coming down as the year progresses.

That's a huge plus for the market.

Um, consumers, they ask us how we feel.

All the surveys look at this
and they say, We feel terrible.

We are scared to death.

And you go, Oh, well,
that must be important.

But then, look at their spending.

They just keep spending.

So something doesn't square with that.

The level of consumer confidence
today is kind of like where it was in

2008 when Lehman was going belly up.

I'm going, wait a minute, this
doesn't feel at all like 2008 to me.

This is goofy.

So why is that?

I guess there's a lot of reasons.

I think one of the things,
particularly for older folks, prices

went up dramatically in 2020 and
2021 when the economy shut down.

We had that big surge.

Fed says, don't worry,
it's gonna come back down.

But what it means is interest rates
sort of prices went up, go up 9%.

It doesn't mean the Fed is not talking
about them prices coming down 9%.

Oh, no, no, no.

It's saying prices went up 9% and
we've got this under control going

forward, they're only gonna rise 2%.

If I kind of cut through this,
it would've been here and now

suddenly, whoosh, they're up over
here and they haven't come down.

Right.

And so.

If, if you're one of those, pick a
number, lower income families, you've

got X amount of money to spend on
the necessity, on housing, on food,

on gas, all of them cost a lot more.

You're really getting squeezed.

Yeah.

So I think some of that explains
why when you do these surveys,

people say we feel terrible.

And for many people that's justifiable.

But the other hand is we like to travel.

We like to go to the theater.

We like to go to movies.

We like to do all these sorts of things.

So we keep spending.

Yeah, I think we're okay.

Inflation is coming down.

The economy is going to be all right.

Interest rates are coming.

What's not to like,

Rodney Lee Rogers: and
that's what it's like.

I listened to this.

You listen to the podcast called Pivot.

They talk a lot about tech in
the economy and how the feeling

is so like, it's horrible.

It's horrible.

It's horrible, but there's no
real numbers to support that.

And so in a way, I love what you said
about how everybody's an economist,

like it or not, but there's so much
emotion that goes in when you don't

understand something and that emotion
seems to kind of sway everything.

And I think.

We think of numbers as non emotional.

Is there a way in which, is that,
does that resonate with you at all?

Steve Slifer: No, I wouldn't, I guess
I wouldn't buy into the emotional thing

so much, but, but the hard thing is
that you say, Steve what do you think?

So I'm gonna give you my view.

Why should you believe me?

There's a gajillion other economists
out there and I can assure you that

the next guy you're gonna talk to
is gonna say the world is ending.

So you don't have the background for that.

How do you pick?

Who you're supposed to believe to believe.

My whole thing has been,
I'm telling a story.

Okay.

Here's kind of one of it, but here are
the half a dozen things that I looked

at to kind of get me there and I'll show
you pictures of all of these things.

In the end, you decide, this is
kind of what I conclude from this.

You can reach your own conclusion
and they may be different from mine

and that's perfectly okay, but it's.

It's hard because people don't
view themselves as an economist.

They are, but they don't know that.

And so, you know, you're, you're left
getting all these different opinions.

When I was working at Lehman, so I would
be press, the Wall Street Journal and

CNBC and all these things would sort
of, well, we had this new, can you

come out and give us some comments?

And so I'd give them some comments
and maybe it would be a positive spin.

I can bet a dime to a donut, the next
guy who comes up on that is going

to have this really negative spin.

So again, how does anybody
know what did I heard?

These two guys are conflicting and that's
why I think it's important for people

to kind of know why I believe what I do.

Not so much my conclusions, right?

How did I get there?

What did I look like?

What did I look at to kind of reach those

Rodney Lee Rogers: conclusions?

The story part is so interesting
too, because that's what we do.

It's like you're telling stories
and that's, we really believe, I

mean, I believe it's like, that's
how humans process any information.

You process it in a story.

Um, with the way the press is, it's
exactly like you said, one person

tells this, one person tells you that.

They're different stories.

How much does that sway the
overall economy, these different

stories that we're getting?

I

Steve Slifer: have a bunch of data
that I, so, and like this morning,

we've got data on the consumer pricing.

It was kind of as expected.

So it wasn't one of those really
exciting numbers where it did something

different, but my conclusions are
going to be drawn on that data.

Somebody else might look at the same data
and, and so you see the CPI, but there's.

I've got like 150 different little
tidbits that go into it and I'll

look at a whole bunch of them.

So it's kind of data, data driven, but I
am looking at the various little tidbits

rather than listening to my colleagues and
say, well, Joe shmoo over here, he kind

of thinks this, so I got to tilt that.

I think I'm smarter than most of them.

Yeah.

Um.

Am I going to get it wrong?

Of course, I'm going to get
it wrong from time to time.

I like to think that I've been in
the business long enough that maybe

I've got a track record that's a
little better than, than usual.

Um, but I, I'm not really
swayed by what other people.

Economists

have this unfortunate
tendency to be doomsayers.

Mm hmm.

And I, it's almost like They think they
score brownie points if they're the first

person to sort of call for the recession.

All right, that's nice.

When I was at the Fed, there
was this one, we were, we'd come

into the Fed about the same time.

We spent 10 years there.

He went to Wall Street,
I went to Wall Street.

He was, he suddenly, he seemed
to have this negative bias.

I seem to have a positive bias.

And so for years, I'd hear
about what he was talking about.

Well, you know, Morgan Stanley
has got this, and it'd be this

really negative sort of thing.

On and on and on.

He's wrong for 20 years.

2008 comes along.

See?

I told you so.

How can you get off with this?

I mean, you've been wrong for so long.

I got to be a vice
chairman at Morgan Stanley.

So it doesn't seem like it matters
too much how right or wrong you are.

Um, it's just, just interesting paths,
but I, I tend to be the optimistic

economist rather than the doomsday guy.

Well, and

Rodney Lee Rogers: it's
very much like performance.

Like we, as performance
theater, we get a script.

All these other theaters get a script.

We try very hard not to base what we do
off of what other people think or say.

You interpret the data, or the
information, and then you tell the story.

And I think it's, it's
a very similar process.

And, um, and the question is when you
have so many different people telling

the story, does it change the atmosphere?

In other words, if you have too
many people talking negative,

does that change the consumer?

In other words, are we in a place with
this consumer that they've been told so

often that it's bad that they believe
that it's bad so that it becomes bad?

I'm

Steve Slifer: sure you guys, you get,
you must read the reviews of the play.

And they all have a spin, much
like what the press is giving

to all these economic data.

You know what?

Some of those people have got
some good insight into things.

And it's perfectly okay, I
think, to incorporate that.

Oh, wait a minute.

This is something I hadn't thought
about when I read this play.

Or this is something I hadn't thought
about when I looked at these numbers.

That's okay.

And it makes, hopefully it makes
for a better production for you.

I think that sort of feedback is useful.

You know what?

It makes you think.

Which is what I like about Pure.

That, you know, we loved Off Broadway
and Off Off Broadway when we were in

New York because they made you think.

This isn't the musicals and No No
Nanette and, you know, it's, you think.

And I like that.

The most fun part, I dare say,
for this whole room is to sort

of go home afterwards or go out
to dinner afterwards and go, That

was the weirdest thing I ever saw.

What the

Rodney Lee Rogers: hell was that about?

We've done that one a few times, yeah.

But

Steve Slifer: that, isn't
that the fun part of all this?

You have all sorts of different views.

That's what I like

Rodney Lee Rogers: about the theater.

Well, that's what, and
that's why we exist.

We exist to, you know,
provoke those questions.

And, and that interest and that passion.

Um, which it sounds, it's very much
the same thing you do, you know,

it's just in a different field.

Different field.

Um, if we go to Lehman, go back to Lehman
Brothers, when you started working at,

at Lehman, who, what was The culture and
what was the past, how much of the past

of the Lehman Brothers was, was the,
was the culture aware of, or, or was

it just something completely different?

Steve Slifer: I think it was more
about, this is a place where you're

going to make a lot of money.

Rodney Lee Rogers: To me when I hear
it, right, making money is a pursuit

versus making money to hoard and spend.

And when I hear people who love to
make money, generally they love to

make money like I love to make theater.

It's something I love.

It's the process, not the passion.

It's a game, not the result.

Exactly.

And the, the complete, um, value,
um, you know, the, the carrot,

so to speak, is so desired.

But at the end of the day,
it's not even technically real.

How much can you spend?

Exactly.

I don't care who you

Steve Slifer: are.

But it was a game.

It was enjoyable.

I enjoyed the game.

As I told you, I got caught
up in the excitement.

That has nothing to do with the money.

I'd have been there if
they'd have paid 102 a year.

I think it was just, it was fun.

Yeah.

And I like being, having a forecast
and then there's going to be a

moment of truth when that thing
is right or that thing is wrong.

And the home team is making money.

The home team's losing money.

because of your forecast.

How exciting is that?

You know, it was enjoyable.

And I liked the people, all those guys,
and I'm sure that the ones that you know

of sort of where they are at the end.

These were all people that I knew
that I worked with every single day.

Dick fold hired me all
of those other guys.

I don't know how, which ones
you sort of picked at the end

or what, which ones come up.

But Joe Gregory, I mean, we've been, I
did all sorts of things with Joe, both

socially as well as professionally.

He was a, he was a fun loving guy,
but then he got, after I left and he

sort of got too big for his britches.

Then he's out there, he's got this
helicopter and he's going back and forth

around every day on his helicopter.

That's not the Joe I know.

He was a, just a young kid out there just
having a good time, but you know what?

He was a good, he was a very good leader.

Joe is one of those kind of
guys that, you know, he'd sort

of tell you to do something.

It wasn't what you wanted to do.

But he'd convince you to do it and
then make you think it was your idea.

How did he do that?

He was good.

All of those guys, every single one.

I would go back and I would work for any
one of them if I were ever to think about

going back to work or doing something.

I have no qualms whatsoever
working for, with any of them.

I like them.

Yeah.

And that includes DePaul.

Yeah.

Rodney Lee Rogers: When it, so when
you left, was there, other than

just time, you were moving on to the
next thing, was there any reason?

No.

Or it was just time.

What, what?

Here's, here's the, here's
the better question.

How did you know it was time to go?

Steve Slifer: I got a
little, I got a little push.

Oh, okay.

Yeah.

It was one of those things, we come out
of the 2000, 2000, the, the recession

there, it wasn't a big one, but law
student is looking to cut for, so you've

got somebody that's been around 20, 25
years making a fair amount of dough.

And it's not, I mean, it's not just
me personally, but a lot of folks,

but they were making a lot of dough.

You can replace them with somebody who's
half their age and making a third of

whatever it is that they were making.

You know, was I pissed off at the time?

Yeah.

Um, but in the end, was it
a big, was it a bad thing?

No.

I, in my more rational moments, I'll say,
yeah, I might've done the same thing.

So it was with a little
bit of encouragement.

Okay.

Happens to all sorts of people.

Right.

the kind of thing anymore where you're
going to stick around for 25 years

and end up with this gold watch.

I mean, it ain't right.

They will keep you on as long
as you're producing and they

will demand your loyalty.

Um, and I can't say it's
always reciprocated.

That wasn't true throughout my career.

When I first started, You get hired
as a salesperson and maybe you're

just not working out the way you
thought or that they had hoped.

They would try really hard to find
another position within the firm

for you, either as a trader or an
investment banker or something.

They would try to work with you,
but that was in the early days.

The world is different.

Competition is just too cutthroat.

And so, you know, if you're going
to be in Wall Street, you just have

to face up to the fact that it's a.

a high risk position.

That's the game you do.

Well, you can hang around for a
while, uh, but if you don't, it's

not just going to stick with you.

It

Rodney Lee Rogers: just doesn't,
In other words, it's changing.

Do you see a time when it doesn't work?

Steve Slifer: No, I think it will
adapt and you can see what AI.

Well, okay, that's coming.

How's that going to change things?

I'm not smart enough to know exactly
why, but I don't think there's ever AI.

What is AI?

It's Artificial intelligence
is based on data.

Now it can be the models that
I used to build or based on

10, 12 different variables.

Now they can have 483, 000 a little bit.

You get more information that
it's all based on history of

things that have happened.

Can that help?

Will it help you build better models?

Maybe.

It's, it's all these
people now do surveys.

Well, exactly.

What's the quality of the
surveys that they're doing?

I've tried to do surveys that is
hard to do and you're taking data

from a little small group and
blowing it up into this huge total.

That's a high risk thing.

You can be really, really very wrong.

So Now, you've got all these
little surveys, it's all

publicly available information.

Guess what?

That feeds into AI.

So they're going to pile all this stuff
in there and it's the old saying that

garbage in garbage out from your model.

You know, if you have a bunch
of crappy data, I'm sorry, AI

isn't going to bail you out.

It can analyze that data better, right?

That doesn't necessarily
mean you get a better result.

Having said that, I'm
a big believer in AI.

Yeah.

I think that it's going to work.

Is a

Rodney Lee Rogers: little where I
am at at the Goodyear product space.

It's a little, it's a little bit
different, uh, it's a little, it's

a little more mobile, if you will.

Um, we just, I mean, I think we're,
we're in the midst of a pandemic,

uh, Um, we're in a pandemic in which
we have a lot more cases and a lot

more infections than we were at
the, at sales that I think we're in.

And so, you know, you've

Steve Slifer: got, you've got.

You've got, uh, uh,
higher mortality rates.

In general, remember we trade
bonds, we trade equities.

The U.

S.

is the biggest economy.

Uh, in the world.

So on my trips to Europe, on my
trips to Asia, everybody wants to

know, wherever you are, wants to
know what's happening in the U.

S., what's going to happen in the U.

S.

Because we are so big that we're going
to drive, why don't we buy stuff from

all sorts of different countries?

Well, if the economy is going
in a slump, we're going to buy

less stuff from everybody else.

That matters to them.

If interest rates in the U.

S.

are going up, guess what?

Interest rates in Europe and
Asia are going to go up just

because of our sheer size.

Why do people do that?

Well, look at us, I mean, we're all
sitting here trying to put some money

away, save some money for retirement.

So what are we supposed to be invested in?

You know, bonds, stocks, um, you
know, within the stock market,

it's not just the stock market.

Now you got, you got consumers,
you got manufacturing, durable

goods manufacturing, you got
all sorts of different, which of

those sectors should you be in?

That's where firms like Lehman Brothers
and Wall Street, they have a whole cadre

of sales people who will work with.

All of us and sort of saying, well, you
know, now given your age and given your

income levels going forward, are likely
to be, we think you ought to be here,

there or wherever it gives us some advice.

Um, and there's not to mention
the fact that there's just

money to be made by trading.

You know, all sorts of
people love to trade stocks.

Again, it's a game.

It's a little form of gambling.

You can go to the racetrack, but why?

You can sit here.

Yeah.

And be right on your computer
and do the same thing.

Yeah.

Um, I don't think it's going away, Rodney.

I mean, it's, is it going to adapt?

But look at what it was.

Look, I look back at from the
changes now from what it was when

I started back in the eighties.

It's just been dramatic.

Think back to the time when
Lehman brothers in the 1850s,

it was kind of commodities.

You'd trade in, And there's a section
in, in, in, in commodities, wheat, and

cotton and all those sort of things.

That was kind of it, but it's evolved.

Economy is involved.

We, can you imagine the, the uproar
that happened when we developed autos?

What happened to all those
little carton buggy drivers?

You know, we wiped them
out, put the economy adapt.

Something A.

I.

comes along.

Guess what, we're going
to adapt to that too.

Do I know what that's going to look like?

No.

Rodney Lee Rogers: Well, if you
find out, you can let me know.

Steve Slifer: Um,

Rodney Lee Rogers: what do you have?

Anything you want to talk
about coming up next?

Anything you have people
can find out about?

Steve Slifer: No, not particularly.

I do.

I do a big conference at the Daniel
Island Club in early December every year.

I'm doing it for.

Most of those years I've been
retired now, people seem to love it.

I mean, it's in the ballroom.

300 people can fit in the ballroom.

They come at 730 on a Tuesday morning
every year and they keep coming back.

So God bless them.

Thank you for coming.

Is it,

Rodney Lee Rogers: can
anybody go or does it have to?

Oh, and it, and it's,
what's the, what's the, um.

It's

Steve Slifer: just, it's, it's
the 2024 economic outlook.

It's Steve Slifer's view of the
world for the next year or two.

When is it?

It's in early December.

I did this year on December 12th.

Rodney Lee Rogers: I'm
going to go next year.

Well, I'll put you on the list.

Put me on the list.

Cause that sounds fascinating.

But you,

Steve Slifer: I'll put you on the
list to get my, the stuff that I do.

I have comments after it, but then
once a week I write a thought piece.

Thought piece being defined
as a thousand words.

Yeah.

Um, and that sort of then goes out with
a little MailChimp blast on, on Friday.

So people

Rodney Lee Rogers: can find you.

So be, so yeah, so you.

I mean, I'm doing this stuff all the time.

How can people, how can people find you?

Steve Slifer: Numbernomics.

com.

There you go.

Number as in economics,
but it's just numbernomics.

com.

Rodney Lee Rogers: Um, I'm trying to
think if I want to ask anything else.

You'll get, you're going to see the play.

What are you, what are
you looking forward to?

What do you, I

Steve Slifer: mean, what I'm
looking forward towards the

end when I, I can identify.

Yeah.

Every one of them I knew,
every one of them I liked.

Dick Fole.

We have a meeting every day, so I'm
sitting there and Dick every, he had

this big giant teddy bear in his office.

Every day, got his little fingernail
clip, clipping his fingernails every day.

How can you do that?

Does he have really long,
fast growing fingernails?

I don't know what to do.

It was just one of little dicks.

Yeah.

Um, and, and so it's fun.

And I will be interested
to see how you treat them.

The world, I don't think
has treated them too kindly.

Um, this is an interesting point.

So at the end, so what happened that year?

Yeah.

Yeah.

Earlier in the year in the spring,
Bear Stearns goes value up.

So you had like top five firms and
then Bear Stearns was like number six.

Come along.

Bear Stearns has got problems,
same problems, making the same

kind of risk that Lehman brothers
and they saved Bayer Bear Stearns.

They merged them into something.

So Lehman brothers come along and
we're kind of picking them off.

From the bottom and every firm, every
one of them, all six were all highly

leveraged just like Lehman Brothers.

So here comes Lehman Brothers.

And so all of a sudden, the bad breath.

Every one of them is reliant on getting
money that they have borrowed in the

market every single day, every day.

So you save Bear Stearns, here
comes Lehman Brothers, uh oh,

big problem with Lehman Brothers.

Do we, so down to the end, it's got
the Treasury Secretary and the Fed

Chair, are we going to save them
or are we going to let them go?

They chose to let us go.

Nobody could, we know what, we
know what happened afterwards.

What about that decision?

In my view, the people who were making
that decision were all ex Goldman people.

The rivalry between Lehman and
Goldman goes back to those 1850s.

There's 150, 160 years of this rivalry.

Now you have a chance to stick
it to one of your competitors.

Do you take it?

Is that the right thing to do?

Obviously they chose to
stick it to the competitor.

That's the Steve Slifer
little take on what happened.

And I suspect there's probably a
little bit of truth in it somewhere.

Um, but then, so they let Lehman
Brothers go and then the B of A's,

the Merrill's, the ones that are
above them, they save all of them.

Why Lehman?

That's the only, the only
reason I can come up with.

Got the chance.

Now you'd like to think they were
above that, but it's not a nice

Rodney Lee Rogers: place anymore.

It's the way it worked out.

Thank you so much for, uh,

thanks so much for tuning in today.

That was Steve Sliper.

Be sure to keep up with
him at numbernomics.

com.

I'll also have that
link in the show notes.

Well, the Lehman Trilogy is up at the
theater and I must say it is stunning.

I got to see it the other night, just
an extraordinary show, so be sure

to get out and see that if you will.

And be sure to like, subscribe, whatever
you do these days, to the podcast.

We're up and running now,
love to keep it going.

Tune in next week when our guest will
be none other than Sharon Gracie,

Artistic Director of Pure Theater
and Director of the Lehman Trilogy.

Until then, have a fantastic week.