Bill Ackman: Here's What the Market is MISSING

00:00:00One of the most provocative and [music]interesting investors in the country.>> A legendary activist investor.>> Pershing Square CEO and founder BillAckman.>> Taking [music] a short position andgoing public with it is a pretty seriousbusiness.Interestingly, [music] some of the bestbusinesses in the world are trading atthe lowest multiples.>> We're kind of the rebirth of theclosed-end [music] investment companyuniverse.>> What did you think of Zara, the CEO ofOpenAI?>> I'm sorry.>> CFO.Felt like the CEO.>> Yeah, I I was Stop with that stuff.>> Uh actually, I was super impressed.Uh made me a lot more bullish on OpenAI,and I thought>> Right?>> I thought she should be CEO of OpenAI.>> [laughter]>> That's what I thought.>> I think Sam should be I think Sam shouldbe chair. I think he's much better.>> a question I wanted to ask her that wedidn't get time, which was what's itlike working with Sam?>> I mean, that could have been like thehours in the documentary.>> [laughter]>> I wanted to kick this off at So, thankyou so much for being here. We've trieda number of times to get you to All-In,and it's great to to finally have you.You obviously are a legend doesn't needmuch of an introduction. Lately, in thethe last number of call it years ormonths or quarters or what have you, itseems like your investment philosophymay be changing. Your model, whereyou've been activist and

00:01:15you've enteredpositions and exited positions, andlately you've talked a lot about morekind of permanent long-term holdings.Would love to hear a little bit about ifthat is actually a change and how yourevolution in your investment model haskind of changed over over time.>> Uh sure. So, I would say the biggestchange over time is an appreciation forthe importance of I would call businessquality. Long-term, durable, protected,non-disruptable growth, I would say.Early days, you'resmaller, more liquid investor, you don'thave to think as long-term. As youbecome a bigger, concentrated investor,uh>> [snorts]>> and over time you learn the importanceof durable kind of growth. That's themost important factor.Uh I would say I'm asactivist as I've ever been um but moreof it's on Twitter than it than uh Iwould sayin the corporate context. And the reasonfor that is when I started in uhPershing Squareno one sort of knew who we were.And soI actually one of our first investmentswas Wendy's International. Wendy's ownedTim Hortons, the Canadian coffee anddonut chain, and the value of TimHortons was more than the entire valueof Wendy's. We had this very simpleidea: buy Wendy's, spin off Tim Hortons,double our money.And uh we bought 10% of the company andI called the CEO and he didn't return mycall.

00:02:30And I called him again, he didn'treturn my call. I literally couldn't geta return phone call. That was thebeginning. Uh so we actually I called afriend who worked at Blackstone andSteve Schwarzman agreed to write afairness opinion on what Wendy's wouldbe worth if we spun off Tim Hortons.We kind of mailed it in, filed itpublicly, and 6 weeks later they spunoff Tim Hortons.>> And then the CEO finally called me backand uh he thanked me uh and he hadgotten fired uhand and uh but he thanked me cuz he hada huge exit package and>> [laughter]>> andand he was very happy. But so in thebeginning we couldn't get a return phonecall, so we had to and we were small, sowe had to go to a conference and we hadto, you know, do presentations and go onCNBC. What happens over time is you joinboards of directors, you become known asan investor, you know, we're kind of aconstructiveshareholder. Um I know pretty much everyCEO in the S&P 500 either directly orone person removed. And you know, maybeI age I've aged a bit um but you buildkind of a reputation and today we buy astake in a companysometimes they'll put out a tweet sayingyou know, we welcome Pershing Square asa shareholder, but they open the doorfor us. You know, in the beginning wehad to bang down the door and today sowe we get very deeply involved in ourcompanies if it's needed. [snorts]Uh other companies we own, there's nonothing for us to do, just be the you

00:03:45know, just clap.>> Hm. So you are you are considered avalue add investor.>> Yeah, but we only want to add value. IThe conversation last night was kind ofan interesting one. You know, the bestinvestments are one where you don't needto join the board and do anything.>> Well, that may be in a startup, but in amature business, it may be>> No, I think in in the public companycontext, one of the valuable things wecan do, that you know, the problem ofbeing a public company today is kind ofthe very short-term nature of markets,analysts, etc. And obviously to run abusiness, a business is a, you know, agood one is a forever thing. And youwant to make decisions in the context ofdecades sometimes or certainly three,five years. And how can you do that whensomeone's asking about the tax rate inthe second quarter?Um and having a big shareholder on theboard, where you can kind of test ideasout with the big shareholder before youexpose them to the public, where the bigshareholder can say, "I'm supportive ofthis initiative even though it's goingto hurt earnings in the next fewquarters." is a helpful thing.>> I just want to connect this lastconversation with Sarah to this.Umare you an investor in the AI complex?Andhow do you underwrite business modelquality from what you see on the outsideand in the entire complex?>> I mean, yes, effectively we're aninvestor. We're Actually today we ownMicrosoft, we own Meta, we own Amazon.Uh actually I think you're eitherdirectly

00:05:00or indirectly you're investedin AI. Yeah. Or it's a threat. So youhave to you have to understand it.Um how do I think about AI in a businessmodel context?>> model quality, yeah.>> Look, when you're a concentratedinvestor or an investor generally andyou're long-term investor, the mostimportant and most challenging thing todo is determine what's the risk ofdisruption. What's the risk of two guys,two women from Stanford in a garage, youknow, coming up with something? Thatrisk I think has gone up uhdramatically. This is the greatest erain history to to build a business,right? There's unlimited access tocompute, you know, certainly for astartup, uh unlimited access to capital,uh and a lot of incredible talent, whichmeans that the probability of your beingdisrupted has gone up enormously. So thehardest thing you have to do as aninvestor isunderstand, you know, and and that'sreally where we spend most of our time.>> in a moment like this then? Do you swingtowards the chaos or do you repositionto things that are maybe more durableand defensible from AI where thedestructibility is less?>> What's interesting about markets ispeople alwaysbring their eye to the new new thing.Um and the new new thing is sort ofchips and semiconductors and energy andthat's where, you know,uhthe shorter-term capital's going. Whattends to happen

00:06:15is really high-qualitythings get left behind. Um and the samething really happened, you know, I was Iwas there in 2000, you know, when the inthe in the in that sort of bubble. Thisis, you know, this is different. I'm notsaying this isum but there's some analogies and theanalogies are people got excited aboutinternet stocks and Berkshire Hathawaytraded at the lowest valuation I thinkit ever traded at in its history aspeople said, "Okay, that's all oldstuff." I think a similar thing ishappening today in a in a sense toAmazon and Meta, Microsoft.>> Those are the ones that>> These are these are old-fashionedcompanies in kind of this, you know, theopen AI>> So they're undervalued in your mind?>> Yes.>> What else is undervalued? What about theSaaS apocalypse though? Is it oversoldat this point?>> Uh again, I think it's a carefulanalysis. I worry more about aSalesforce um than I do about your kindofum I think you got to do the work. Ithink it's one company at a time, but Ithink if, you know, if your softwarecompany today, you have to be as AIenabled as you can. You can I I thinkthere have been sort of monopolistictype profit taking off of customers whensomeone had a kind of a niche softwareproduct that charging, you know, 30,000a year or something like this. I thinkthose companies are really at risk. Uhyou know, Microsoft when the averagecustomer's paying,

00:07:31I don't know, 50bucks a seat or some small number, uhthat platform's worth a lot more uh andis less of risk.>> I want to go back umto COVID because you had an incrediblyviral momentwhere you were on CNBC at that momentand you pounded the table and you saidthis is what's going to happen andliterally the market just ripped and youyou werewell first it went traded massively downyou were right on that side of the tradeand then you were on the right side ofthe trade when it ripped back up. Andthen I think it was maybe a month or twoago I think publicly you basicallypounded the table and said this market'sgoing way higher.Can you just put us in your head likewhere does thatdesire to be soactive andyou know you you it gives you so muchroom to be wrong but then when you'reright it does add to the lore of BillAckman of which you have a lot so how doyou balance that where does it come fromlike why in these moments do you justget so convicted that the that theconviction just has to spill out andthen you're just so out there?>> So I've always been likemy high school yearbook epithet was mostverbose. Uh me too.>> [laughter]>> And that and actually my my friendactually lives around hereuh

00:08:46he he has quote that he put next to myname in my yearbook says a closed mouthgathers no foot that was his.And so that's kind of what I've lived byI've always had this sort of desire tospeak the truth about things andyou know was just talking with Jakeactually we had breakfast this morning.Uh and we're talking about my Rhondapost do you remember that one so youknow there's just certain things thatneed to be shared and discussed. Butwith respect respect to markets Iactually what happened wasI was concerned about the countrybecause I felt we needed to have abasically a two-week pause and this isMarch ofor February I guess it was Marchof 2020 and I assumed we were going tojust do a short-term shutdown let thevirus cool down as hospitals were goingto getting overwhelmed.Andthe president hadn't done that yet I waskind of surprised by this.And so that that was what inspired me togo on TV as a way to reach uh PresidentTrump and say, "Look, we need to shutdown the country just for 2 weeks, youknow, like uhand I said, "Look, you do this, okay?The virus will blow over. Stocks are atan incredibly cheap valuation. If wehandle this correctly, you're going tomake a ton of money, and we're buying."You know, valuation is like a tether onthe market, right? When it gets toohigh, it's like this rubber

00:10:02band that'sstretching. And inevitably, it bouncesback. But it works the other way aswell. When stocks get too cheap, there'sthis, you know, the the rubber band'sactually pulling valuations up.>> Right.>> And and so there are there are certainmoments where it gets to that place.And sometimes, actually, if you callthat out, it causes people to have kindof a psychological reset.>> What happened recently that caused youto call that out?>> Stocks just got crazy cheap. Justincredibly cheap of really high-qualitycompanies.>> Right.>> What I don't know II don't know why>> extremely cheap in fundamentals and>> Fundamentals based on, you know, what'sthe value of a financial asset's presentvalue of the cash it generates over itslife. On that basis, stocks are ofreally high-quality companies are reallycheap.>> Is there any way to underwrite and youknow, I don't want to pick on specificcompanies, but we have the three thatare going public, and then you have likea Palantir, let's say.And these things have become in verypopular in pop culture, in maxingon subreddits, on, you know, thepublic's consciousness, high-net-worthindividuals wanting to buy into SPVsthat are doubleloaded and then getting wiped off thecap tables.Is there any way to underwrite 100 timesrevenue, 50 times revenue, 150 timesrevenue in these companies, or are thesejust tremendously overvalued because

00:11:17ofthe demand side?>> I think you underwrite a SpaceX the wayyou underwrite a venture capitalinvestment.>> Interesting. Explain that. Unpack it.>> So, everyone here invests in venture,right? You know, you bet on, you know,who's running it, right? The talent isenormous. Um it's people who they taughtmeI had a professor business school hesaid people opportunity context deal.So on people SpaceX>> One of one.>> Yeah. Opportunity one of one.Context you know, incredible andactually you know, feel bad for BlueOrigin but not harmful to SpaceX thefact that you know, they're they'rebiggest>> way behind.>> Then you get to deal, okay? That's themore complicated question for SpaceX.Again, we don't know what the valuationis going to be but if it's a billion atrillion 750 billion dollars then yousay, okay, well, let's think five yearsout. What does this company look like?You know, what is Starlink? What's thetrajectory of Starlink?You know, SpaceX's you know, nearmonopoly in terms of low cost spacelaunch that's going to becomeincreasingly important and even Amazonis going to have to become an evenbigger customer because they're not youknow, Blue Origin's you know, and andtime I would say has become increasinglyvaluable in the AI era, right? You youdelay a model we were

00:12:32talking David andI were talking about the administrationand and his kind of stepping in for thepresident not to sign that executiveorder to kind of slow us down.>> Allegedly.>> You lose a month, you lose a couple ofmonths today and it means a lot. So Ithink the only question I have and Ihaven't done the math, I you know, I Iactually invested in XI invested in XAI. I'm in an SPV.>> Ron Baron said, Bill you got to investin SpaceX so>> so I'm I'm I'm in so now I have soobviously I'm rooting for kind of a goodoutcome.I just doesn't I haven't done theYeah, you have to>> What about Anthropic, OpenAI andPalantir?>> Okay, I'm sorry.>> Uh Anthropic, OpenAI, Palantir also fallinto this category. Do you underwritethose as venture investments as well andhave you done the the work on those?>> They're venture investments that do whatwhat's helpful is they're not seed orseries A, right? They'reyou know, D or E but they're still likeventure investments. These companieshave proven they can generate a lot ofrevenues and actually I was just sayingon Sarah, I thought she had a very, verythoughtfulexplanation on how they think aboutcommitting capital, right? And andthat's the thing I haven't heard from onOpenAI, which is why if I were OpenAI,I'd be getting that message out becauseyou know, from the outside,you're like, it's a pretty interestingbusiness model. You got a company that'sspending making capital commitmentsthat's massively in excess of,

00:13:48you know,revenues. And how do you do that andget, you know, it's it's degree ofdifficulty, I would say, is hard.>> Your perch on the boards of, let's callit these more traditional Fortune 500type businesses and your conversationswith those CEOs, how are they thinkingabout AI? Is it something that they'retipping into into with pilots? Are theydoing transformation initiatives? Dothey think this doesn't really apply tous? We'll deal with it later. Whatwhat's your sense of how they'readopting or embracing AI?>> say every CEO in America today is like,how do I use AI? How does it apply to mybusiness? How is it a threat?They got to find an internal champion.They maybe have to recruit someone fromthe outside. I would say it's on thehierarchy of things they worry about,it's probably number one as both anopportunity and a threat. So, if you'renot paying attention to it, you'reyou're I mean, your board is going tobe, you know, asking you with firstquestion every meeting about, you know,what how we dealing with the AI threat?How we dealing with the AI opportunity?So, it's absolutely top of mind.>> Are you seeing much early success? Imean,through your, you know, again, throughyour visibility into these companies. Imean, there's a lot of mixed signalsthat we get like McKinsey did a studyand said that 95% of enterpriseinitiatives actually fail. Chamath,you've made this point

00:15:03around 80, 90,that a lot of these enterprises don'treally know how to deploy AI. The theyou know, the fanciest title in SiliconValley these days is a forward deployedengineer, which is basically a like anIT consultant who can close the gapbetween the promise of AI and the ROI ofit. And I think people are just tryingto figure out like how do we how do weuse this thing? I mean, have you seenmuch actual success? Is this the Is thisthe question right now? Is this how dowe bridge this gap?>> So, I haven't seen much successother than I mean, I'll give you thePershing Squarestory. You know, we're a tiny littlecompany. How are we using AI today? Thefirst use case is really on the legalside. Um [snorts]andyou know, kind of almost almost you callit a compliance back office type youknow, functionality. I think we're stillsuper super early in terms of bigcompanies using AI effectively.>> Can I ask or test a thesis with you? Youknow, the the venture underwriting modelwhere you think about people, you'reunderwriting a founder and theircapacity to lead and redirect theorganization in a changing environment.In technology environment, marketenvironment and whatnot. And we haveseen repeatedly similar success at scaleif the company is still founder ledwhere the founder feels like they havethe authority to make all the radical

00:16:18decisions needed to make sure that thatcompany persists and changes as neededin a changing environment. Have youlooked at founder led companies versusnon-founder led companies where perhapsthe founders really do have an inherentadvantage in being able to navigate thechanging environment and actuallygenerate outsized returns over time? AndI ask this particularly as it relates tothe SaaS apocalypse and if you take alook at the companies that are founderled today versus not, if you're notfounder led, you have an incentive tonot make a mistake and get fired. Ifyou're founder led, you don't give a Your job is to make sure thecompany>> Yeah, I think the answer is exactly whatyou said. I think the problem is thatthe average life of an S&P 500 CEO isprobablyI don't know, 4 years or 3 or 3 and 1/2years or something like this.And you're focused on, you know, kind ofshorter term compensation. You don'tgenerally don't have a big economicstake in the business. You're a founder,this is your entire life. It's yourentire reputation. It's not like you'regoing to go get another job. You got tokind of make it work. And also whenyou're in the board room, you have theauthority of either being a majorvoting, you know, voice, or or a umyou've got a huge economic stake in thecompany. You know, when we join a boardof a company, we're often the largest orthe sec- the largest non-index fund typeshareholder. That kind of gives us, youknow, a little bit of a disproportionatevoice in the boardroom. Imagine if youhave that and you're CEO of the company,

00:17:33right? So, I think that does give youand and also if you've gotten to be asuccessful founder over time,uh guaranteed that you've made a numberof very challenging call calls over timethat turned out to be right, otherwiseyou wouldn't be there. And so, you lookat Mark Zuckerberg, right, when hebought, I don't know, Instagram,everyone's like shocked at the pricepaid or WhatsApp, you know, they seemedlike, you know, sort of outside the youknow, the company only had, whatever, 19employees or something when he paid abillion something. Um but you makeenough of those calls umand uhyou can make the other challenging call.>> antithetical to a Ben Graham investingmodel? Like, you have to have adifferent set of skills as an investorto to identify this talent versus>> Yeah, so I mean, Ben Graham is a reallyimportant voice for investors in that hesaid, "Look, you got to think about abusinessa stock certificate is an interest in abusiness as opposed to just this pieceof paper." That's probably one of hismost important kind of aphorisms. But hewas investing for the most part inliquidations. He was in that you know,in the days of Ben Graham where thereweren't there's no Edgar system and norto get a 10K filing, you had to go tothe headquarters of the company. Therewere a lot of stocks trading at, youknow, basically the cash on the balancesheet. And his business model was, youknow, buying these things at stupidlycheap prices and eventually Um but BenGraham made most of his money investingin I don't know, Geico

00:18:48or something. Uhyou know, not>> Tell us a little bit about you know,there's a sort of activist andsignificant shareholder, but thenthere's Howard Hughes, and you've talkeda little bit about Berkshire Hathaway2.0 or just being inspired by thatChamath you were inspired by for a longtime.>> Well, Bill Bill just took PershingSquare public.>> Yeah, but with with the Howard HughesCorporation specifically, tell tell usabout that effort cuz you're operatingthat business.>> There's a book uh I think it's calledThe Financial History of BerkshireHathaway. That's for geeks. Um itbasically this guywent back and read every 10-Kwhatever you actually went through thefilings, looked at every deal thatBuffett ever did, and you follow himover 60-year period of time. And thevast majority of the value he created atBerkshire was through it actually theownership of insurance operation.And what's interesting about insuranceis thatyou know, running an insurance companyyou have two jobs. One is you you know,write business, right? You take risk. Umyou collect premiums in exchange for theobligation to pay future claims. Andthen you get that you get money upfront, and your responsibility is toinvest that money. Uhthe vast majority of insurance companiesfocus only on the liability side of thebalance sheet. Buffett was really thefirst to do focus on actually more onthe asset side of the balance

00:20:03sheet thanon the liability side. And over timeon the liability side, if you if youmanage the assets of an insurancecompany well and the liabilities well,you can build this enormously profitablecompounding tax-efficient machine overtime. And the question is why haven'tother people done this?And the answer is if you're really goodat investing, you go work for a hedgefund, you go work for Fidelity, you gowork for Wellington,but you don't go work for an insurancecompany. So the insurance company'sability to recruit investment talent isvery limited. Buffett owned half thecompany, he was really good atinvesting, which is why it worked. Sowhat we're doing is we're you know,Buffett started with a crappy textilecompany. He effectively liquidated itover time, reinvested in insurance, andthen invested the assets well.Howard Hughes is actually reallyinteresting company, but it's a businessthat Wall Street has not cared about fora long period of time. We created it outof the bankruptcy of of General Growth,it was a spin-off of all the otherassets.And it's a company that owns these smallcities. So I bet a lot of people herehave heard of Summerlin because a lot ofthe tech community has moved fromCalifornia to Las Vegas,but we own a this small city, 26,000acres of land.We own all the commercial land, we ownall the residential land, we sell lotsof home builders, we build a downtown,we build buildings.

00:21:19It's a bit like the Irvine company. Youknow, Don Bren created probably ahundred billion dollars of personalwealth managing a small city. It's asuper cool company, but the time frameis decades as opposed to quarters.So, Wall Street's never cared, it'salways traded at a huge discount. So,Buffett bought into a textile businessat a discount to liquidation value. At$63 a share, you're owning Howard Hughesat a discount to liquidation value. Whatwe're doing is instead of reinvestingall the cash the business generates intoreal estate, we're going to reinvest allthe cash into insurance.We're going to next within the next weekor so.>> You're in the business of building thisflywheel.>> We're going to build this into acompounding machine over the next 50years. It's something I've always wantedto do. We have the benefit ofunderstanding both the insurance side ofthe business and we can manage theassets well. You can buy it at, youknow, whatever, 60 cents on the dollar.>> How do you think about investing theassets of this insurance company? So,>> So, what Buffett did is he took 100% ofthe insurance float and put the money inshort-term treasuries. So, he took norisk on kind of policy holder funds.He took 100% of the surplus of theinsurer, the equity, and invested incommon stocks. And that's what we'regoing to do.And I think we can build a reallyprofitable insurance company. We'restarting at a very small scale. Thecompany's got like a four billion dollarmarket cap. And the goal is to build itinto a trillion dollar thing over time.

00:22:35Compounding. The other thing Buffett didwell is that he didn't issue any stockor not for a very long time. So, they,you know, he started with a millionshares and today is effectively like amillion and a half.>> this is the future for very talentedmanagers like yourself versus thetraditional long short fund or do youthink they sit side by side?>> I think it's hard to do this cuz youneed control of a public company and youhave to be not in a get-rich-quickmindset. And there, if you're in theget-rich-quick, it's easy to go toCitadel and Millennium or one of these.>> Why does it have to be public?>> Why does it have to be public? Itdoesn't. It doesn't have to be public.>> Why did you choose to take it?>> Uh you know, we we got here by accident,right? So, the most successful equityinvestment we've ever made is we boughtthis company called General Growth. Webought the stock of a company goingbankrupt. Sort of the most contrarianinvestment you can make. Stock [snorts]went from, you know, uh $20 market capto $100 million, and we boughta basically auh a third of the company or 27% of thecompany at uh $200 million market cap,and there was $27 billion of debt. Andthe bankruptcy emerged, and the strategywe said is, "Look, the assets are worthmore than the liabilities. We're goingto do the first uhrestructuring where the equity gets tokeep their investment in the company."Two years later, we emerged from Chapter11. The stock went from $0.34 to $34.But, part of the restructuring wasspinning

00:23:50off this thing called HowardHughes. It was really all of the junkthat didn't belong in the company thatthe analysts hated. Um and so, we we didituh with sort of an inverted investment.And you know, 15 years later, we haven'treally created much value with it. So,we said, "Look, we've got to you know,the market doesn't like this thing. Themarket A company has to earn a return inexcess of its cost of capital in orderfor a stock to go up.And the you know, Elon's done an amazingjob keeping the cost of capital of hiscompanies really low. You know, ifSpaceX goes public at a trillion $750billion,it'll probably be the lowest cost ofcapitalequity capital transaction in thehistory of the world. The problem withthis company, cuz it's real estate, cuzit's development, cuz it's landownership, the market says, "The cost ofcapital is really high, and you can onlyearn a certain return on real estate."So, what we're doing is we'rerepurposing the real estate assets, andwe're transforming the company into amuch higher returning Well, the last fewyears, you've become incredibly famous.I mean, just to kind of put a fine pointon the word. How does thatchange and influence the way thatmarkets work? Because like, you know,your voice gets amplified now.You also have other places where othervoices get heard, many people's whosenames you don't even know. You go intoWall Street bets and every random Tom,Dick, and Harry with an opinion. Tell usthe way the markets have changed withnotoriety,

00:25:05fame, social media influence,not just yours, but in general.>> Yeah, I don't think markets have changedas a result of anything that's happenedwith me or follower growth on onTwitter. I think the Ryan Cohen guy, youknow, the GameStop guy.>> Yeah.>> You know, that is a change in marketswhenum you know, a stock can trade at avaluation well above the its valuesimply on the personality and theability to>> Vibes.>> Vibes.>> To gather up, you know, armies offollowers. You know, thefascinating thing about liquidity andvaluation isthe higher a stock price goesand it's going to sound sort ofintuitive, but it's not.The more valuable the company becomes.You know, there's [snorts] actually theincrease in value the company increasesthe value of the company, right? Becauseit lowers the cost of capital, it givesyou more flexibility, gives you theability to issue stock, raise capital,acquire other businesses. And so, youknow, getting back to the Elon example,uh it's really his I mean, I would sayhe's a better example of this. We've nottaken advantage of this at all. Maybe weshould. But he builds an army ofbelievers and followersuh that enableduh Tesla to

00:26:21be built.UmYou know, the>> Let me maybe help Marcus.>> And as we wrap up with a somewhat of apointed question, you're an incredibleinvestor. If there are people if we wantto be maximally aligned with BillAckman,is the best way to be an LP in PershingSquare or is it best to go into themarket and buy>> So, we have two I think there are threeways you can invest with us that are alldifferent and a little cheap differentthings. One is something I think calledPershing Square, which is the managementcompany of Pershing Square. I think it'sone of the most interesting, kind ofintellectually, businesses because it'sauh it's the entity that receives fees onthese three permanent capital vehicleswe manage. So, it's a royalty on thecompounding of investments in theseentities. And there's no CapEx in thebusiness. So, we're going to pay outbasically all of our profitsand we're going to grow as quickly asthe underlying assets uh compound. So,[snorts] if you invested a dollar inPershing Square, you know, 22 years ago,that's that becameumyou know, uh20 uhI thinkI should know this number. It's like 27or 28 times net of all fees.>> Wow.>> Okay. Over over 22 years. Had we chargedthe fees of this public vehicle, uh thatnumber would

00:27:36have been um you know, uh37 times.>> I'm sorry. No, more than something inthe mid-40s.>> Okay.>> What this means is we now have a publicvehicle that charges only a 2% fee.We've got a one in London that chargesan incentive fee. If we compound at therates we have historically, we'll have35 times the assets under managementuh in 22 years. So, we'll go from 25billion of assets to somethingapproaching a trillion. We don't have tohire another person.Uh and we don't have to spend anotherdollar, if you will, on overhead. ThatThat's a pretty interesting business.So, I like that one. So, PershingSquare.You want to invest with us as aninvestor, invest in something calledPSUS. And you own a portfolio of ourbest ideas and it's trading at an 18%discount to cash. You want to believethat we can build the next BerkshireHathaway, you own Howard Hughes. We'vegot three different ways.>> Yeah, I'll put some Howard Hughes. Ithinkfollowing you on Twitter and going thegoing direct movementdoes allow you to communicate directlyyour vision and and that actually makesit much easier to to place the bet. Andso, I I do think it has a profoundimpact cuzprior to yourextremely long tweets that have beenparodied now, there's an incredible memeof a Bill Ackman tweet coming in, whichis>> you did that with your extended iPhonethat's a foot tall.>> No, it was that was my Halloweencostume.>> Yes.

00:28:53You would have written somethingshorter. You just didn't have the time,yeah?>> Yeah, I guess. I don't let other peopleread, you know,>> Do you do you do you like having alawyer or anybody read it?>> On the the Ronda tweet, which had somelegal implications, I did have mycommunications guy and a lawyer.>> Yeah.>> A friend who's a lawyer read it, but Ionly gave him a few minutes cuz I was soexcited. Once I write something I reallylike,>> I just want toI got to push it. Yes, I agree. I agree.>> And the torpedoes.>> I>> Tom does this, too. He starts getting alittle bit frantic when he's writingsomething and then he's like, "Fuck it."He just hits send.>> [laughter]>> I just hit send.>> By the way, it's a very powerful thingto be able to share your view and push abutton and reach 2.2 million people. So,I'll I'll I'll have to Why don't we justtake a picture on stage and I'll send itout.>> Let's do it. Let's do it. Let's do it.Let's do it.>> Liquidate it.>> Gone all in?>> All right.>> All right.>> Relax. Thank you.