Goldman's Blankfein Talks Trade, Credit Markets and Bitcoin

I'll let you know. I mean, the problem is, how many times can you be on the edge of your seat waiting for the shoe to drop, and it doesn't drop? And how many times can you get that anxious about it? I would say I don't know if this is going to be the pattern of North Korea — a lot of bluster. I don't think we're in a suicide pact on this, so I suspect that we're not going to cause the economies to collapse with a smooth through Bali on steroids. But I do think that — so I don't think that's what's going on. I do think, as some people have commented, that this is a kind of negotiating pattern. That would be my best take.

Well, I met him in China. There was a trade mission, and I'll have to say, let me give credit: it didn't occur to us to go on the trade mission. I got called up by the White House and they said, 'Do you guys have a pending transaction that's near enough to close that we could close it as part of our trade mission to China?' And I just said, 'No, we don't.' And I got a call back — yeah, we have a lot of things going on in China. I got a call back from them a couple of weeks later, just before — not like I was looking for an extra trip to China — and they said, 'Remember what we asked you? It turns out yes, you do. The Chinese said you do.' And so we went there. In fact, we closed an important transaction, which is a kind of a joint venture between ourselves and the sovereign wealth fund of China to go out and each raise an amount of money, put it in a private equity fund, and invest in US businesses that will be able to export into China. So this was an early effort, symbolic in the scheme of the whole level of US trade, but an important symbol of what China wanted to do.

Certainly, the whole thing with China — there's a lot of frustration with China from here. I know that China is very frustrated with the sudden aggressiveness of US policy. But anybody who has transacted with China appreciates the potential of China, has had good experiences in China and frustrating experiences in China, and at various times one or the other comes to the fore. We ourselves, to be quite honest, 15 years ago almost set up our joint venture in China that was to lead to us being able to own our own investment bank in China, which seemed imminent at the time. And there have been a lot of suggestions that that was going to happen very quickly, and in fact statements that said it's already available. And then oftentimes that gets announced at the senior-most level, and when it gets into the ministries that have to effect these things, we found out recently that now, these many years later, in order to own our own entity it has to be capitalized at a level that would make it totally not sensible for us to do it. And so we feel back at square one. That level — again, we're in finance, but we're advisors to people in other industries, and other industries have similar experiences. And again, this would not be the course I would have done — not necessarily commend — but I could see what happens at times. A lot of the people who are expressing publicly that this is a very difficult thing, Americans, a very bad thing — which of course we know from taking economic courses that it is at the end of the day — and publicly making these statements because they do business in China and you have to pay homage to your clients in China and your customers in China, and at the same time when they're not in public could very well be going to the US government and saying, 'You know, what you're doing may not be such a bad thing.' And so I can understand how we get to the place that we did.

It's not my style, but if what you want to show is — if you want to give somebody an incentive to see the world from your point of view, it doesn't help to remind them of your negotiating position if it's a better one. And the fact is, if we go tit for tat, by the time you get to a hundred, they run out of things to apply a tariff to and you don't. And so if you want to make that point, you make that point now. That's what you would do if you were crazy and really wanted to end free trade, and that's what you would do if it was a negotiating position — you wanted to remind your negotiating counterparty of just how much firepower you had to bring to the negotiation.

Rosencrantz and Guildenstern playtest — you can't even versus flute. How could you play me? Who am I to say what he thinks? He doesn't — I don't know what he would do. What I would do in his place, and I'm not sure — certainly not sure what he would do in his place. But if you asked me, can I give a narrative about how this is a useful thing to do? I can't. As a lot of people do with respect to almost everything he does, this makes no sense at all. It does not make no sense to me at all. Okay?

Two things: you could separate them. Talk about the risk. A lot of the risk in the world today is concentration. There's a lot of risks in the world, but a big concentration of risk today is sovereign risk. We're looking at the politics, but you can look at the economic situation. A lot of the leverage in the world that was with the banks didn't disappear from the world; it migrated over to the sovereign. So you see that the sovereign — in the US we have the $4.5 trillion balance sheet, you look at euro similar amounts, Japan's similar amounts — 50, 14, 15, 13 times debt on sovereign balance sheets. The banks are de-levered, but now the risks are with the sovereign.

I suppose Italy would be the one, of course, for a variety of reasons. One, it's got a huge amount of debt. The debt might be big for its partners. In 2011, when there was a sovereign debt crisis in southern Europe, the issue was: is there the willingness of the ECB — i.e., is there the willingness of Germany — to sort this out and to back up this southern Europe situation? Now, those lines never converged. The sovereign debt of the southern European countries, especially Italy, had continued to widen out. They were getting an interest rate subsidy for being connected to Germany, but they didn't deploy that to reduce their debt. And so I think at this point, now the question is not the willingness but the capacity to do it. Now, one thing about the US: we print the money we borrow. Japan prints the money it borrows. And there's a lot of risk and consequences to printing too much money, but that's not as easily a systemic moment — it causes inflation if you overprint too much money, but that's not exactly going off a cliff. On the other hand, in Europe, everybody borrows in a foreign currency. Italy doesn't print euros — it doesn't bargain lire anymore, it borrows in euros — so it's always more worrisome how one would deal with that. Of course, there are rules that the countries in Europe use to protect their fiscal policy. And again, I would say that issue, and obviously immigration, are the big risks to the whole construct of Europe.

Yes, and also big because of its size. And that was there for a while, but also more recently because of their election of a more unusual coalition — well, getting more usual all the time, if you look at what happened in Central Europe and obviously in the United States, the weakness of Mrs. Merkel in Germany. You're getting — again, I don't want to merge these two things, but the financial risks of these countries and also the kind of immigration issue, which creates some stress on establishment governments, which feed into the financial crisis, and that creates the geopolitical risk that we see, especially what's happening to Merkel at the moment.

Well, I think it happens. We're seeing this in the United States now on our southern border — obviously horrible, tragic situations — but it's an immigration issue. The immigration debate has split the country, and more realistically in Europe, more dramatically and consequentially in the near term, the immigration issue in Europe — where magnanimously you'd say Germany admitted a couple of million people, you'd say the right thing — but hard cases make bad law. And of course, with open borders in Europe, Brexit is a direct link to the consequences of the immigration crisis. They're talking about a soft Brexit. If you get the soft Brexit that people are now speaking of, the only thing that Britain will have accomplished in Brexit is the immigration matter. And you look at the populism in these states that's going on in Italy, and certainly the relatively right-wing movements in Central Europe — those are reactions to immigration questions. There's an interesting balance. So you, on the one hand, view — again, wrong — hard cases make bad law, because I wouldn't want to be in the position we find our government in now with respect to the tragedy that's going on at the border. And you wouldn't know which to choose out of — well, I would say I couldn't do it. I couldn't do what obviously is being done now, so I agree with all the things. But when you watch TV, you listen to the pundits, I don't hear anybody talking about the consequences: how long would it take for millions of people to appear on our southern border if we permitted it, and permitted people to pass through? The same thing that happened — you saw the tragedy and the consequence of what was happening along the Mediterranean. And again, you learned this — one other thing, one of the cliches of law school: hard cases make bad law. When you want something, when it appeals to you and to your heart, and you make something work out as a matter of your sense of justice as opposed to a rational progression, you can end up with a hard case but bad law.

Look, we can change our mind. We do things — I mean, some days I do things out of the public eye, some things I do in the public eye. I just think the consequence is — and again, when I watch the punditry, it's all right. And look, again, when he's stabbed — you know what we're watching now is part rendering. And again, I wouldn't be on that side, but thank God I'm not there because I would — in my role, and certainly in government where you have to make these choices, look, it's never right against wrong, good against evil. The issues are always right against right. Now, what do you want to do? Both sides are right. Could you open with this? Could you admit millions of people into Germany, and what happens to the European construct that worked for 60, 70 years, which arguably ended a pattern of every-generation warfare, that is put at risk by immigration? Is that right to do? No. Is it right to leave people — babies strewn on beaches? Of course not. You know what the right thing to do is? Both sides. What do you want to do? So I would say what's hard: it's easy to criticize, and it's easy to say what you would do if you didn't have to bear the consequences for what you decided. But when you have to bear the consequences, you have to realize that there are adverse consequences on both sides. That's what's really tough. And I have a lot of sympathy on the one hand, but appreciation for the decision-making. And when something doesn't quite work out right, I don't want to kill the person that made the decision.

No, because I can't imagine being more miserable than I was made by people outside of public life, so why not? No, I don't. For finance ears of your age to run for mayor of New York City — that would be... somebody asked, somebody put that out there and they said, 'Would you?' I said, 'Oh no, I would be mayor of New York City. I don't know if I'd run from a busy city.' What about — I think I'll take that as a no.

A question for Marty Phil: how high can they go? I mean, I lived through a time when I got out of school — short-term government interest rates were in the teens, and not the low teens, by the way, while inflation was also above 10 percent, by the way, while unemployment was above 10 percent. So these things can happen. I know everybody is debating — lips are quivering — is the Fed going to raise three times this year or four times this year and next year? I remember sitting in '94, I remember the Fed raising 50 basis points between meetings. So I don't think people are braced for what the potential is if the Fed feels that it gets beyond the curve, and what would be the consequences of that. And just think: every bond that's been bought since interest rates have been low and trending low for so long — everybody wants a higher interest rate so you have a higher return, but don't forget every instrument in anybody's portfolio will then drop in value. And whether you mark to market or not, it will be worth less. And just think of all the assets in the world that are priced off of a discount model — how about real estate and almost everything else? I mean, you think what happened with the finances of the world and the economies of the world because of a dramatic and unexpected and rapid drop in real estate prices. Well, I would think the fall-off of a rapid rise in interest rates, unexpected, would have an even more dramatic effect. Is this my base case? No. But I'm in the business of risk management, and I'm forced to spend about 98 percent of my time worrying about the 2 percent of the things that would go wrong. And I could occupy more than the time you have here to tell you the things that I have to worry about.

Well, we intend to be in business through — I don't know how long this cycle lasts — and we intend to be good risk managers in this business through all the cycles. We're not going to chime in and get into and out of businesses that are franchise businesses for a cycle. We're going to acclimate our risk and how we land in our protocols and our profile to what we feel the market is. But let me just say, as a predicate: the predicate in your question is, in a way, we're going into the consumer business, but not so much that we're chasing a consumer business that's so far into us — consumer business generally is far into Goldman Sachs, a wholesale and institutional firm. But really, what's happened as a result of movements in technology, the opportunity in the consumer space has moved to us. If you're lending to 500 people, the kind of decision-making you'd make in consumer lending is like 'Jimmy Stewart, It's a Wonderful Life' — you look into somebody's soul, your neighbor, and you're a good credit, you're an honest person, I'll lend you that much money, Mrs. So-and-so. But if you're lending to 50 million people, it's math, it's algorithms, it's macro risk management, which is the stuff we're kind of good at and have been good at for a very long time. And if they're not your neighbors but they're coming to you online, then it's digital delivery and digital platforms, which we're kind of good at and we've done for a long time. There obviously is a big customer experience to this, and we have to import that into the firm. But a lot of the risk management decisions, the distribution decisions, the algorithms that one would go into making these kinds of decisions, is in our wheelhouse. And one of the reasons why that represents a big opportunity for us is that we don't have legacy stores — we don't have thousands and thousands of branches that we have to protect. On the one hand, the normal disruptors in this space, the Silicon Valley crowd that would normally come into this space, don't have license deposit takers and don't have balance sheets, and really can't do it — the kind of jerry-rigged and securitize these loans and have to make them all kind of the same so they could be securitized. And so there's a very good opportunity. Very rare that you get a big bank like ours that doesn't have a legacy consumer business that needs to be protected.

I won't feel happy if they don't pay us back.

Well, I will tell you, we will be the ones that will suffer because — again, these are not mortgages on people's homes or secured lending. If they don't pay us back, your honor, we'll be the ones on TV that you'll feel sorry for, as possible. Thank you. Obviously, by the way, we have other consumer verticals too, and there's more to be rolled out in this space. But it looks very attractive. Again, it's the migration of the opportunity, not us trying to be what we otherwise would have been ten years had we chased this business ten years ago.

Never get worried about them periodically. It's obviously more than eight years since the last one. In Europe, you know, for a few hundred years people were told to expect a war every generation; it hasn't happened. So I'm not — I look for these things. I don't think the mere passage of time causes it. You need, in the metaphor, kindling on the floor of the forest. You need some things — you need leverage, some things that could blow up, and then you need the spark.

Too much leverage, bad behavior in the context of the last financial crisis — bad origination practices — and then, of course, the spark could be some macro event, some default that happens, a bad play by the sovereign, bad fiscal policy, a bad monetary policy could be the spark. But something that, in a period of time in which there wasn't this kindling, this leverage, or this opportunity, might pass unnoticed. But at a time when it was ripe for it, would cause it. And I would say if you were looking for some signs now, your earnings are good, you're not really seeing the kind of leverage. But maybe you don't see the leverage until after the fact, and you look back and say, 'Oh, how was there and I didn't know it?' I'd say credit seems relatively easy, but on the other hand, it's not remotely close to the leverage that one would have — looks people like us would have financed in the run-up to the 2007-2008 crisis in terms of the transactions. So you don't see it. Look, you don't see the things you can't see. The reason why these things become bubbles is they're not easily seen. The advantage of your job versus my job is I have a P&L and I can't remember having seen it; you can always claim to have seen it.

I think the worst thing we did — look, our risk management was pretty good. We participated in the market for real estate — real estate prices went down, and that was the crisis. There was real estate went down, and all the debt in the world that was collateralized by real estate went down as a result, and that was 95% of it. So on the risk management, we didn't know what would happen. We bought stuff, we sold stuff, we basically ran a balanced book. The crisis was really two halves for us: it was the existential part — did you lose a lot of money, do you have existential risk, could you be insolvent — which we navigated very well. And then the reputational part of it. For having navigated it pretty well, it went from 'How did you do it?' to 'How did you do it?' — meaning, when you were hedging, you sold things to people, you must have known, you should have known, blah blah blah, and therefore you were — we ran it, but we didn't make money in the financial crisis. We didn't lose money in those years, but we lost a lot of reputation in those years, and a lot was inflicted on us. And I think the thing we did the worst at was underappreciating — we were wholesale. We never advertised. We didn't have our name on our building. We moved to a new building and put our name on our old building now. But other people, if they have some sort of crisis, they change the copy of their ads and they go out and they talk to their customers. But we took the position always — we had the view, keep our name out of the paper, put our customers to the forefront, we represent them in M&A, but it's really not us to get the attention. We had no real advertising budget at all. And it turns out that you can have a consumer business, but other means — consumers are taxpayers and citizens. And so we had an important lesson: we discovered that they had a relationship with us, we had a big effect on them, and of course we discovered they had a big effect on us — not because they were consumers and we were a bank, but because of their role as taxpayers and consumers and our position in the financial system as a very big influential firm that was influential in the context of financial crisis that affected everybody. And so that was an adjustment that we had to make very quickly. Prior to the financial crisis, I never would have appeared at anything. My predecessors certainly didn't, and it wouldn't have occurred to me. And I realized that if you don't describe what you do and help define yourself, you'll have left a vacuum that someone will very easily define and describe for you. And so that was a very important lesson. I learned a lot of little lessons for crisis management that I never expected to need to know.

There's things about Volcker Rule — there's a lot of redundancy. There's leverage tests. There was supposed to be a catch-all — you're supposed to have capital related to the riskiness of the assets on your balance sheet, and then there was a general worry that maybe we weren't assessing riskiness the right way because in the financial crisis we underestimated the riskiness of certain mortgage assets. So in addition to using a normal test of leverage based upon the risk of your assets, let's have a general catch-all: when we don't assess riskiness of assets, we'll just look at all the assets on your balance sheet, including dollars and banks. And that was supposed to be a catch-all to make sure that nobody — kind of the tax version of an alternative tax, if you will. Well, it got to the point where that catch-all is now the binding constraint, and it was never intended. So those things have to be adjusted. Volcker Rule, which was added kind of as an addition to making sure that people had capital against their risky assets and were able to wind down an institution that was failing — Volcker imported a state of mind test: what was the reason why you engaged in that transaction? To support a client's business, or because somebody wanted to buy low and sell higher? In the real world, people aren't really thinking that way. It's kind of market making and doing that. And so that's been a little bit counterproductive because the regulators in turn put the bias — we were soon everything is for a bad purpose unless you prove your state of mind was for a near-term expectation of a client flow. It created — I mean, for a time, the book of record was set to provide metrics that would prove that I was actually interfering with a safety and sound system because it can contribute to safety and soundness. So there's things like that that I think everyone recognizes have to be changed. Some people don't want to get into any changes for fear that if you open it up you'll wreck everything. But I think after the way this was put together, after a period of living with it, I think there's room for some adjustment. But I don't want to get away from lauding the regulators at the time and the people in the public sector for the way they handled the war that was in the fog of war and the aftermath. And all you have to do is juxtapose how the US financial system has responded and how quickly it regained its footing compared to everybody — compared to our counterparties in Europe.

That didn't obviously start with the financial crisis — Sarbanes-Oxley is a big contributor. But it's been — the anguishing that you're seeing in the press now for where Aramco is going to list — in other words, we have, in an effort to make our markets pristine, which is a laudable goal, and complex litigation standards — I mean, I will tell you, not everything about being a public company CEO is as attractive. It must look to you — how would you change it? Because it is a real structural issue. You make it tougher and tougher, and companies won't want to be public. And so all of a sudden you'll get a two-track system where you'll have very tough regulation on companies that are public, and increasingly companies that defer going public, with the consequence that their investors are not remotely as well protected. And so what do you want? And I'm saying, by the way, this is something — and again, not to use the example I use per se — but this is something that the chairman of the SEC said: there are half as many public companies in the US as there were. Is that a good thing? I mean, if we wanted to really toughen up, have five public companies and everybody else was dealing in private markets, and we increased the liquidity available to private markets, would we accomplish safety and soundness objectives of the system? No. And so I'm not bargaining for a collapse and abandonment of systems, but you know, once you do a cost-benefit analysis of some kind on whatever incremental benefits you're getting compared to the burdens and the cost you're putting on the system —

I think parts of our business, but it's not something we can recriminate about or wring our hands. We could not have stayed — public with who we were in the financial system. We could have elected — in order the way the world evolved, we started out as an advisor, but in order to be an effective advisor you had to be able to give effect to the advice you were giving. So I could tell you, 'You should do this merger,' I could tell you, 'You could do this financing,' I could tell you, 'You should grow your business in this way.' But to be an effective advisor, I had to put capital on the table for you or your benefit, or help you raise it so that you could achieve that objective that you and I would agree was good advice. If we were merely advice givers, we could have had a very important role in this system — there are a lot of great investment banks, they do very well, they don't have 90% of the problems or issues I have in my life as somebody who runs Goldman Sachs. On the other hand, they're not as important in a lot of ways, and not the influential institutions that we are. And we decided as a firm that we like the position that we had as a very important institution and driver of growth and change in the financial system and the evolution of business. We liked who we were. And in order to do that, we had to have a balance sheet, and in order to have a balance sheet we had to have permanent capital, and to do that we had to go public.

I worry — I'm not really in any kind of systemic way. It would be very painful to somebody who put his or her entire net worth into cryptocurrencies, but it's not a systemic issue at this point. People are passionate for it, passionate against it. I remember when they first came out with cell phones. I remember thinking, 'God, who the hell is going to lug this thing around? And besides, there are ten phone booths on every corner. I'm not going to — this is a fad, nobody's going to carry a cell phone.' So I just passed on that whole thing. Turns out to have worked. So now they have cryptocurrency, and I always thought — I can't say why it should work, but if it did work, I'd be able to explain it in hindsight why it did.

Yeah, well, you have to look at things from both sides and say, 'If it — sometimes in a risk thing I say, will this happen? What are the chances of it happening?' And sometimes I find it easier to think about something: okay, let me postulate this did happen, tell me why it did. And I find that sometimes that's a way of seeing. And I look at the evolution of money and I say, you start out with gold as money, and people only take hard currency, and you make gold coins, and a gold coin was like five dollars that had five dollars of gold. And eventually they would give you a piece of paper with the promise that there was five dollars in gold to back the five-dollar piece of paper, and you could go in and redeem it. Then they gave you a piece of paper and said there's five dollars of gold but you can't redeem it. And at some point they give you a paper and says it's worth five dollars, we're not going to redeem it, we don't even have the five dollars even if you wanted to. And we're still doing that today. And I see that morphing, and I'm saying that if you could go through that morphing — if you could go through that fiat currency where they say this is worth what it's worth because the government says it is — why couldn't you have a consensus currency? And so it's not for me. I don't do it. I own no Bitcoin. Goldman Sachs, as far as I know — unless nobody told me — has no Bitcoin. But if it does work out, I could give you the historical path why that could have happened. And so I'm not in this school of saying, 'Gee, because it's uncomfortable with me, because it's unfamiliar, this can't happen.' That's too arrogant.

Other firms have more senior women. Sometimes it's — we've had very senior women, people take different career paths. The most senior woman at Goldman Sachs was the person who ran our era until actually the end of this month, because of her resignation. And sometimes people have to work harder at this and get on it. We're working very hard at this, and you're right, there's nobody who is that proximate. Other firms may have different experiences. We certainly have metrics in some cases — senior women partners at the highest level — but at that absolute highest level, sad to say, and blame some of it is fortune and where people have put themselves or taken themselves. It's not a unique problem to any of us, but that said, it's a problem people are going to have to work harder at, and we're trying. It's different — people could say it is a problem generally for Wall Street. No, of course it is. It's a problem generally for our business as a whole, and you can look way outside of business too. It's a problem for institutions, it's a problem in walks of life, to have more of an equivalence between the demographics of the country. And it's not just a gender issue. And there's nobody who wants to explain it away because it looks like you're trying to be exculpatory if you try. So let's just say we all have to work harder at this, and we try various things. You're about to point out a fund that we're committing to that will invest in startups for women, women-managed venture funds. We have other programs like this that support women's initiatives, women in the workplace initiatives. And we have a very good record of bringing women into the firm, and like everyone else, a very poor record of bringing people into the top leadership position in the firm.

Well, obviously, when I started — because that was a long time ago, a generation and a half ago — the big thing I would have said at the beginning of my career was globalization, which sounds like a quaint term now and something that has now gone through its cycle that we're all trying to kill, but people are now hostile. That's gone full cycle. But when I came into the firm, I came into the foreign exchange department. We could not issue a confirming sterling or in any currency other than a dollar — didn't print it. And so I rode the crest of the wave of globalization. Now, in the last 15 years, it's the crest of the wave of digitalization and technology. And today, if you want a price on an equity or an instrument, 98, 99 percent — it could be 100 percent — of the prices that we make on a market basis are made by algorithms that are made systemically. It's not just distributed that way; the prices are made off of inputs that are input digitally. And that's a kind of a new phenomenon. I'll tell you another observation: the decision-making, of course, is judgment in this, but the decision is being made by programmers and software experts. And a lot of times I look at somebody — what used to be called 'judgment,' 'oh, that's a judgment decision' — saying, 'Oh, judgment decision, that's just a few million extra lines of code.' Because eventually you can — doesn't that frighten you in a variety of ways? Of course it does. By the way, it creates an interesting phenomenon. Look at what if the same thing for Uber: you're going to have drivers, and 'gee, why did you drive through that stoplight and into that storefront and injure those people instead of swerving into that wall and killing yourself?' Well, you would say, 'I didn't know, I didn't think, it was a natural instinct, I couldn't help it, it just happened the way it happened, and it's all a blur to me.' It won't be a blur. Some programmer is going to say, 'If you see that wall, drive into the wall.' Or it won't say that, and they'll come back and they say, 'Why didn't you drive into that wall instead of into that storefront and risk more lives and your own?' And those are things that are going to happen. 'What did you take into consideration when you made that risk judgment?' 'Well, let me see, let me subpoena your software and your lines of code and see exactly what you anticipated to have done in this situation.' So it's an interesting set of phenomena.

There is, of course. There is. Pretty much the point I'm making. But putting that to one side — I mean, several myself — but the other effect of technology is that people can, in a sense, work anywhere. Computers could be based anywhere. You're doing stuff in Salt Lake City. This is the Economic Club of New York. How does New York prosper in this new age of algorithms? Does it still retain its position?

Well, it turns out — remember the world is flat, everybody will go to the lowest cost place, and so you'll work out of someplace on the steppes of Central Europe and Central Asia. It doesn't work that way. There was this book — I think Richard Florida — it turns out that people in the kind of creative class like to live amongst each other. They like to go to the theater, they like to aggregate together. And of course, it's not going to be in a world of automatons; there's going to be creation and things. And by the way, even though the lines of code have to be written, there's not going to be a lot. And the people who create, and the people who get together, and the people who engage, are going to want to aggregate together. And New York has had quite a head start on aggregating together people who are like that, and has the infrastructure that tends to attract more people who are like that, and those people attract each other. And so I tend not to worry about New York, as long as they don't keep making it so very expensive to be here versus other very attractive places.

Yeah, well, I would say if I advocated moving out of New York, it would really hurt my chances.

Thank you very much.