Wealth Actually

"MUNICIPAL BONDS: THE ORIGINAL IMPACT INVESTMENT?"

For this first WA episode, I spoke with Matt Posner the Director of the Impact Coalition.  We attack a bunch of topics centered around the emergence of the municipal bond markets' increased relevance in the impact investing world.  Matt is helping to coordinate through the efforts of the Impact Coalition.

THE IMPACT COALITION (www.theimpactcoalition.com) is working with the largest underwriters, investors, and state and local governments to build a new language to analyze public infrastructure projects. The Coalition allows market practitioners to have a universally recognized Social Rate of Return on projects that improve the daily lives of our communities, and as a result, lower the costs for those that are raising funds for the public good.

Matt has spent the last 15 years analyzing the intersection of public policy, financial markets and state and local governments. Prior to the Impact Coalition, Matt was Head of Market Strategy for a venture-backed start-up aiming to modernize public finance through technological advances, called Neighborly. During his tenure there, the firm successfully raised a Series A round and started an asset-management firm with a focus on socially responsible investing. It was during this time that Matt dove into the impact space and realized its true potential to help make positive community changes around the world.

Prior to Neighborly, Matt started a consulting and research firm, Court Street Group, which provides weekly analysis of public finance along with several municipal bond market veterans. He is an Advisor to that company and writes for them. He began his career writing about Nuclear Energy and was a Managing Director at a boutique public finance research firm, Municipal Market Advisors.

Matt has testified before the U.S. Senate Committee on Finance on infrastructure finance problems facing the country and spent years educating staff in the U.S. House of Representatives, the U.S. Senate, the U.S. Treasury Department and the Securities and Exchange Commission, among others, on public policy and market implications. Matt has been quoted on his views and published in the Wall Street Journal, the New York Times, Bloomberg News, The Bond Buyer, the Municipal Finance Journal, and the Government Finance Officers Association's Government Finance Review, among others.

Matt doesn't lack for international experience!  He spent most of his childhood abroad in Senegal, The Gambia, Bolivia and Peru. He is a graduate of Georgetown University with degrees in Government and History.

The format of our discussion is below.

Questions

Background:

Tell us a little bit about your background

How did your career evolve?

The Impact Coalition:

What problem was it formed to solve?  Why do we need a new language for public infrastructure?

What does it do?

Who is a part of it?

Various issues in the Municipal Space

Vast number of public issues

Some universal language, some language particular to state law

Problems with indexing

Intensive manual reading and credit analysis

Predicting interest rates

Different levels of information

Emerging technology AI, ML

Active v. Passive Management

How would the IC's work help the RIA community?

What is there problem in dealing with clients fixed income needs?

Fixed income ignored?

Difficult to tell the fixed income story?

Difficult to tell the ESG story?  Municipals:  The Original Impact Investment?

Munis simply a tax free income play or something more?

Tech issues

International Investing community

Confused by lack of universal vernacular around public infrastructure

Interest in infrastructure- unsure about "impact"

Little experience in munis- Americans have long retail history- don't understand the disconnect

Grappling with increasing interest rates?

Better to go with high dividend equity infrastructure on after tax basis?

Contact

How do we keep track of the Impact Coalition's progress?  (www.theimpactcoalition.com)

How do we keep track of your whereabouts?

Some quick news which you all probably guessed: the Frazer Rice podcast has been rebranded "Wealth, Actually" to align with my new book on the issues around wealth management.  And don't forget about "Wealth, Actually" the book:

https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT

https://frazerrice.com/wp-content/uploads/2018/08/Frazer-Rice-FB-Live.mp4

Thanks to David Grasso, Scott Richmond and the team at Bookstr for having me on their Facebook Live channel.  It's always a pleasure to discuss "Wealth, Actually."

A link to the book is here and don't forget to leave comments on the Amazon site.

https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT

https://frazerrice.com/wp-content/uploads/2018/08/Frazer-Rice-FB-Live.mp4

Thanks to David Grasso, Scott Richmond and the team at Bookstr for having me on their Facebook Live channel.  It's always a pleasure to discuss "Wealth, Actually."

A link to the book is here and don't forget to leave comments on the Amazon site.

https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT

Here is something that is a little bit new!  I was interviewed on my new book "Wealth, Actually by Josh Jalinksi on his Financial Quarterback show on 710 WOR ad on #iheartradio.  We discussed estate planning, family dynamics, investing and a host of tools that could helpful in making good decisions about wealth.  Thanks again, Josh!

To buy "WEALTH, ACTUALLY" on AMAZON, click BELOW . . . Feel free to leave Amazon Reviews (hopefully good ones!).  They help the algorithm.

https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT

 

 

 

Here is something that is a little bit new!  I was interviewed on my new book "Wealth, Actually by Josh Jalinksi on his Financial Quarterback show on 710 WOR ad on #iheartradio.  We discussed estate planning, family dynamics, investing and a host of tools that could helpful in making good decisions about wealth.  Thanks again, Josh!

To buy "WEALTH, ACTUALLY" on AMAZON, click BELOW . . . Feel free to leave Amazon Reviews (hopefully good ones!).  They help the algorithm.

https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT

With the 2018 midterm elections around the corner, I spoke with Ben Phillips about the impact of policy on the investment world.

Ben Phillips serves as the CIO of EventShares, overseeing research and portfolio management for the U.S. Policy Alpha ETF (PLCY). Mr. Phillips previously worked for Goldman Sachs Asset Management, where he had portfolio management responsibilities across several multi-sector total return funds. Prior to GSAM, he held senior investing roles at Providence Equity Partners and Lord Abbett. Mr. Phillips is a CFA charterholder and received an MBA and BSBA in Finance from the University of Missouri. Mr. Phillips works in the firm's New York office.

Background:

* How do you think about investing at Eventshares? (What is the effect of Policy on the markets)

* Government affects everything.  How do you break this down and organize your thinking?

* Once your themes are established how do you implement your findings into good investment ideas?

Onto the 2018-2019 political environment:

First, what do we make of the general political environment and the effect of Trump?

Second, what is the current thinking on the midterms?

Onto the specific policy themes that affect investments:

Policy themes outlined by Ben:

* Trade: "Trade continues to be the biggest potential headwind to the market. We expect headline volatility to linger, as markets attempt to decipher if Trump is bluffing on tariffs. While negotiations play out, we prefer to hold U.S. focused companies with minimal foreign currency exposure."

* Immigration: "Border arrests trended down in 2017 after Trump assumed office pledging an immigration crackdown. However, 2018 border arrests are increasing as the administration doubles down on its agenda and strengthens border enforcement. We expect this to impact U.S.-Mexico relations and be a defining issue in the midterm elections."

* Trucking: "Electronic logging devices (ELDs) continue to be implemented, which we believe will slow trucker productivity. In our view, ELDs are compounding a driver shortage, which will force trucking companies to increase compensation and turn down freight. We prefer to own asset-light companies with exposure to the spot freight market, as well as companies involved in the intermodal and rail markets."

* Defense: "The FY 2019 appropriations process is underway in Washington D.C. We continue to expect companies involved in the defense industry to grow their revenues over the upcoming years due to the long lead time of defense contracts and the added tailwind from foreign demand. In our view, aircraft manufacturers and shipbuilders are best positioned to benefit from increased spending."

* Refining Spreads: "The U.S. energy boom continues to redefine the energy market. Drilling companies in the Permian Basin are extracting record amounts of oil, but pipeline capacity issues mean not all of it is moving out of the area. Trucking shortages (see above) are exacerbating the issue, causing some drillers to sell at the local Midland spot price to refining companies. The refining companies may then be able to capture the spread by selling the oil at WTI or Brent benchmark prices."

* Financial Deregulation: "The Trump administration continues to focus efforts on dismantling the Consumer Financial Protection Bureau (CFPB), which is responsible for consumer protection in the financial sector. In our view, this will continue to benefit specialty finance companies, non-traditional lenders, and select regional banks."

* Healthcare:

* "The Affordable Care Act (ACA) continues to be a long-tail policy. After years of fighting the ACA,

With the 2018 midterm elections around the corner, I spoke with Ben Phillips about the impact of policy on the investment world.

Ben Phillips serves as the CIO of EventShares, overseeing research and portfolio management for the U.S. Policy Alpha ETF (PLCY). Mr. Phillips previously worked for Goldman Sachs Asset Management, where he had portfolio management responsibilities across several multi-sector total return funds. Prior to GSAM, he held senior investing roles at Providence Equity Partners and Lord Abbett. Mr. Phillips is a CFA charterholder and received an MBA and BSBA in Finance from the University of Missouri. Mr. Phillips works in the firm's New York office.

Background:

How do you think about investing at Eventshares? (What is the effect of Policy on the markets)

Government affects everything.  How do you break this down and organize your thinking?

Once your themes are established how do you implement your findings into good investment ideas?

Onto the 2018-2019 political environment:

First, what do we make of the general political environment and the effect of Trump?

Second, what is the current thinking on the midterms?

Onto the specific policy themes that affect investments:

Policy themes outlined by Ben:

Trade: "Trade continues to be the biggest potential headwind to the market. We expect headline volatility to linger, as markets attempt to decipher if Trump is bluffing on tariffs. While negotiations play out, we prefer to hold U.S. focused companies with minimal foreign currency exposure."

Immigration: "Border arrests trended down in 2017 after Trump assumed office pledging an immigration crackdown. However, 2018 border arrests are increasing as the administration doubles down on its agenda and strengthens border enforcement. We expect this to impact U.S.-Mexico relations and be a defining issue in the midterm elections."

Trucking: "Electronic logging devices (ELDs) continue to be implemented, which we believe will slow trucker productivity. In our view, ELDs are compounding a driver shortage, which will force trucking companies to increase compensation and turn down freight. We prefer to own asset-light companies with exposure to the spot freight market, as well as companies involved in the intermodal and rail markets."

Defense: "The FY 2019 appropriations process is underway in Washington D.C. We continue to expect companies involved in the defense industry to grow their revenues over the upcoming years due to the long lead time of defense contracts and the added tailwind from foreign demand. In our view, aircraft manufacturers and shipbuilders are best positioned to benefit from increased spending."

Refining Spreads: "The U.S. energy boom continues to redefine the energy market. Drilling companies in the Permian Basin are extracting record amounts of oil, but pipeline capacity issues mean not all of it is moving out of the area. Trucking shortages (see above) are exacerbating the issue, causing some drillers to sell at the local Midland spot price to refining companies. The refining companies may then be able to capture the spread by selling the oil at WTI or Brent benchmark prices."

Financial Deregulation: "The Trump administration continues to focus efforts on dismantling the Consumer Financial Protection Bureau (CFPB), which is responsible for consumer protection in the financial sector. In our view, this will continue to benefit specialty finance companies, non-traditional lenders, and select regional banks."

Healthcare:

"The Affordable Care Act (ACA) continues to be a long-tail policy. After years of fighting the ACA, Republicans appear slightly more willing to expand Medicaid and Medicare, but only under their terms. While risk reduction payments were recently in the headlines after a New Mexico court ruling, we don’t believe they will be stopped under the ACA. In our view, these two items will help stabilize the insurance exchanges and insurer business models."

"The Trump administration also released its drug pricing plan during Q2 2018. In our view, the plan does little to impact drug prices or pharmaceutical company business models."

Midterm Volatility: "Campaign season will kick into high gear during Q3 2018. We expect the political environment to be highly charged. In our view, it’s too early to call midterms as control over the recent Supreme Court vacancy and immigration will be contentious items. Plus, Donald Trump is a master campaigner who gets his base."

Following up with Ben:

How can we keep track of your policy thoughts and their impact on the markets:

WWW.EVENTSHARES.COM

How do we find out more about Eventshares?

How do we keep track of your writings?

***This podcast is a educational discussion about the impacts of governmental policy on investments.  It is neither an advertisement, nor an endorsement for Eventshares.***

In Podcast #25, I was able to speak with Bill Yoh, the author of "OUR WAY".

In the book, Bill tells the story of Spike Yoh, the driving force behind Day & Zimmermann with un-sugarcoated candor.  An embattled son becomes a patriarch. An untested employee becomes a CEO. A husband becomes a caregiver. A student becomes a teacher, and ultimately a student. Spike Yoh’s life story paints a vivid picture of the profound and very human forces that shape leadership. From a troubled childhood that would have propelled most into a cycle of broken relationships and self-doubt, he rewrote the rules of his own life, and in the process built his father’s company into a billion-dollar enterprise.

Author, Bill Yoh serves as a speaker, biographer and strategist, helping other family business owners navigate the opportunities and challenges that inevitably arise when personal and professional lives intersect. As a third-generation owner of Day & Zimmermann, his family's 43,000-employee, century-old family business, Bill has a rare and personal view of the complex and human dynamics behind today’s multi-generational family businesses.

INTRO

Background:

Tell us a little bit about your background

How did your career evolve?

How did writing become a part of it?

How did the story and the principles of Spike Yoh become a focus?

Day and Zimmerman

Tell us a little about where Day & Zimmermann came from and what they do

Recount some of the fulcrum moments of Spike’s leadership

Importance of the motto

Difficulties that were surmounted

Successes celebrated

Involvement with the community (and family) and its importance to corporate mission

How did Spike first begin to involve the family in the decision-making around the family and the wealth?

What worked and what didn’t?

What moments in his life may have informed some of the choices made?

Process of succession of the business

Operational Succession v. Ownership succession

How was the future management of the business chosen?

Tradition v. Qualification?  Inside v. outside?

Tenure v. new blood?

Direction- growth v. income?  Focus v. Diversification?

Public v. Private?

How were family members chosen within that context?

Aptitude, Ability, Interest, Capacity, Temperament

Stories around successes and issues here

How was ownership succession chosen?  Every one equal or each according to need, none of the above?  Was there structure around the wealth to try to prevent bad habits/encourage good ones?

How did you surround yourself with advice around that?  You obviously had formal advice (legal, banking, accounting etc  . . .).  But did you have a shadow cabinet or a set of like-minded executives with similar experiences that you could lean on for their advice?  How was the board involved?

Was philanthropy part of the equation?

How were decisions made within the family?  How was the process of socialization/buy-in?

Other shareholders?

How were the other stakeholders incorporated in the decision-making? (employees, customers, vendors, community)?

Familytics

What are the issues you see with families with succession issues

What are best practices that you have seen with your family and others that can apply?

What are the various tools and communication practices that can be useful in helping families on that...

In Podcast #25, I was able to speak with Bill Yoh, the author of "OUR WAY".

https://www.amazon.com/Our-Way-Life-Story-Spike-ebook/dp/B0786QGZ6K/

In the book, Bill tells the story of Spike Yoh, the driving force behind Day & Zimmermann with un-sugarcoated candor. An embattled son becomes a patriarch. An untested employee becomes a CEO. A husband becomes a caregiver. A student becomes a teacher, and ultimately a student. Spike Yoh's life story paints a vivid picture of the profound and very human forces that shape leadership. From a troubled childhood that would have propelled most into a cycle of broken relationships and self-doubt, he rewrote the rules of his own life, and in the process built his father's company into a billion-dollar enterprise.

Author, Bill Yoh serves as a speaker, biographer and strategist, helping other family business owners navigate the opportunities and challenges that inevitably arise when personal and professional lives intersect. As a third-generation owner of Day & Zimmermann, his family's 43,000-employee, century-old family business, Bill has a rare and personal view of the complex and human dynamics behind today's multi-generational family businesses.

INTRO

Background:

Tell us a little bit about your background

How did your career evolve?

How did writing become a part of it?

How did the story and the principles of Spike Yoh become a focus?

Day and Zimmerman

Tell us a little about where Day & Zimmermann came from and what they do

Recount some of the fulcrum moments of Spike's leadership

Importance of the motto

Difficulties that were surmounted

Successes celebrated

Involvement with the community (and family) and its importance to corporate mission

How did Spike first begin to involve the family in the decision-making around the family and the wealth?

What worked and what didn't?

What moments in his life may have informed some of the choices made?

Process of succession of the business

Operational Succession v. Ownership succession

How was the future management of the business chosen?

Tradition v. Qualification?  Inside v. outside?

Tenure v. new blood?

Direction- growth v. income?  Focus v. Diversification?

Public v. Private?

How were family members chosen within that context?

Aptitude, Ability, Interest, Capacity, Temperament

Stories around successes and issues here

How was ownership succession chosen? Every one equal or each according to need, none of the above? Was there structure around the wealth to try to prevent bad habits/encourage good ones?

How did you surround yourself with advice around that?  You obviously had formal advice (legal, banking, accounting etc . . .).  But did you have a shadow cabinet or a set of like-minded executives with similar experiences that you could lean on for their advice?  How was the board involved?

Was philanthropy part of the equation?

How were decisions made within the family?  How was the process of socialization/buy-in?

Other shareholders?

How were the other stakeholders incorporated in the decision-making? (employees, customers, vendors, community)?

Familytics

What are the issues you see with families with succession issues

What are best practices that you have seen with your family and others that can apply?

What are the various tools and communication practices that can be useful in helping families on that journey?

How does FAMILYTICS work?

Contact

How can we get a hold of "Our Way"?

AMAZON

How do we find out more about Familytics

FAMILYTICS

How do we keep track of your whereabouts?

BILL YOH, AUTHOR

OUTRO-

https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT/

Today we were able to speak with Leslie Danks Burke.

She is a public advocate and the Founder and President of  TRAILBLAZERS PAC :  a political action committee dedicated to finding and supporting candidates for local political office beyond typical party ideology and structure.

Based in Horseheads, NY, Leslie's goal is to improve the quality of candidates and the political discourse in this country, one municipality at a time. 

Their mission statement states: "Trailblazers PAC reconnects citizens with democracy by moving politics out of the back room and onto the front porch. We educate candidates on building an honest donor relationship with their own voters. We invest in candidates for local office who take action for clean government."

She is here to help us

make sense of the current political environment,

its impact on the current political apparatus, and

the direction of grass root campaigns going forward

QUESTIONS 

Background

Where are you located?

Work Background

Interest in politics

Frustrations with the System

Consensus between parties being thwarted

Quality candidates scared off by a poor process

Lack of new ideas / good ideas thwarted

Entrenched interests

Impact of money

Issues

The Impact of Trump on the Political Industrial Complex

Big gov’t v. small gov't

Changes in the media and distortions in “story distribution"

Gerrymandering / obstructionist voting laws and other distortions

Lobbying interests

Schisms in voters along income, education and cultural fault lines

The pull of better economics (and weather!) in other states

How do you establish consensus-common ground

The Opportunities for Positive Change

What does Trailblazers seek to do?

What type of races are interesting

What geography?

Is there an ideology?

Improving candidate quality/interparty dialogue?

Predictions for the future

How do we keep track of your progress?

TRAILBLAZERSPAC.COM

FACEBOOK.COM/TRAILBLAZERSPAC 

@TRAILBLAZERSPAC

@LDANKSBURKE