RAOUL PAL: The next bit we're going to do
is we're going to do a series of fixed questions.
We've done this before on Real Vision, I think
with you in the very early days.
It's called the Intersection.
Is there one person living or dead you'd want
to interview more than anyone?
If so, who and why?
DYLAN GRICE: It would actually be Jim Simons.
I was going to see Richard Feynman who is
a hero of mine.
In many ways, Feynman had a bigger impact
on the way I think of investing than any investors.
I said, I really think that science is-- I
think that science and investing are actually
cousins.
I don't think that there is far removed--
in principle and in essence, they're not so
different.
Subject matters are radically different but
in essence, they're not different.
I wouldn't be able to have much of a conversation
with Feynman about theoretical physics.
I don't know if he'd be that interested in
finance, whereas Jim Simons is both.
He's a brilliant guy.
He had a brilliant career as a mathematician.
He won the, what was the-- the Veblen Prize
for geometry, age under 40.
He assembled a team of code breakers for I
think the NSA, and then he's assembled this
team of code breakers who have cracked the
market.
This is a guy who does understand finance.
He doesn't understand markets, but fundamentally,
he understands science and I just think that
that would be a mind blowing conversation.
RAOUL PAL: Yeah, that's right.
Okay, next question.
What is the book or books that have changed
how you view the world, and how so?
Also, what are you reading right now?
DYLAN GRICE: The books that really change
the world indeed, for me, these are always
funny ones because something that had huge--
books that have a big impact on you are really
very much a function of where they hit you.
RAOUL PAL: Absolutely right.
DYLAN GRICE: You can see well, for me, a book
that had a huge impact on me was Taleb's Fooled
by Randomness.
I'm a huge-- I know he's not everyone's taste.
I'm personally a huge fan of the guy.
When I flipped through that book, and I find
that there isn't really much in any of the
chapters that surprises me or that I didn't
know, or that I don't know, and not anymore.
It was almost like when the first time I read
it, a light went on.
The fact that I can look at it-- I've been
in this dark room and all of a sudden, somebody
just switched the light on.
That's the central foundational role of irreducible
uncertainty.
This is central to everything that I do as
an investor and everything that I think of
as an investor, and I can trace that back
to Taleb really.
The fact that when I look at the book, and
I almost-- there is nothing left to absorb.
I think I've absorbed this all so watch, I
think that's testament to just what bigger
impact to add on.
RAOUL PAL: Yeah, and it could've been a better
book for now.
I suppose a Black Swan and a half.
DYLAN GRICE: Yeah, completely.
One month, what won't change in one month.
It was just [indiscernible] now.
RAOUL PAL: Okay, next question.
As an individual and as a leader in your field,
how do you stay engaged and relevant in a
world that's moving so quickly?
DYLAN GRICE: Well, engaged is easy.
Relevant, geez, let's talk about-- you just
hope I guess.
How I stay engaged-- RAOUL PAL: Basically,
how do you stay on top of where we are in
the world?
We have a lot of people who get left behind.
DYLAN GRICE: I think from an investment perspective,
this is again, I need to invest, I need to
be investing.
I can't just be reading about investing, reading
about the newspapers.
I have to be a participant in the market,
so I know how to feel it.
When the market's going down, I have to feel
that pain.
I have to feel that anguish and that anxiety.
It's almost like I have to have that connection
to what's going on.
That's how I stay engaged.
That's how I stay curious.
That's why I just have a daily flood of questions
that don't have answers to, I want answers
to, and therefore, that's how I spend my day
trying to answer as many of those questions
as I possibly can.
How do you stay engaged?
Just by being embedded.
That's it.
I think more broadly, kids are great for making
you realize how quickly the world is changing.
I've got a couple of kids and they just do--
they do and see hilarious things, and I think
that that keeps you engaged with the broader
world.
In terms of staying relevant, yeah.
RAOUL PAL: Well, running a portfolio keeps
you relevant.
Because we are basically saying the skin in
the game.
DYLAN GRICE: Yeah.
Oh, for sure.
This is, again, this is central, and this
is an obviously that's a big Taleb thing,
but another one of my view is Warren Buffett,
always, always getting his own ticker, always--
I may be wrong.
I could be very, very wrong, but I'm not going
to sell you something that I'm not going to
do myself.
I think that that's almost as-- that's a bit
as good a safety valve is that you're going
to get with any manager.
Question number one, are you invested in this
portfolio as much as you expect me to be?
When you hear-- [indiscernible] has got a
couple of million in it?
The answer is no.
RAOUL PAL: Okay, next question.
Some of our guests can tie their success to
one key breakthrough.
Did you experience a tipping point in your
career?
DYLAN GRICE: Yeah, actually.
I think the biggest and maybe it was thanks
to Table, I don't know, but I was sitting
on the prop desk at Dresdner.
I'd come down from the economics department.
I was the bookish academic, didn't really
know much, which is all true.
The other guys on the desk were seasoned traders,
options traders, options market makers, they've
cut the teeth in there in the open outcry
system of life, cash equity market makers,
risk ARB traders, investors I should say,
so I really was the outlier.
It was my job just, as I saw it, to shut up
and listen and learn.
We had this conversation one Friday morning
about the article in payrolls and what we
thought the payrolls were going to be.
We haven't really long involved debate and
it basically went on like this.
I think we're going to be charging 50, I don't
want to be charging 20, I don't want to be
charging any, what do you think, Dylan?
You're the economist.
I've not got the faintest idea.
I really, genuinely, truly don't know.
Oh, you must have a view.
Okay, well, what is this in the screen?
What's the market expectation?
Okay, that's my expectation.
You don't have a view?
You're in the wrong job, man.
That's what the guy sat next-- who's really,
really lovely guy, a good friend of mine.
He said, you know what, you're in the wrong
job, man.
I thought, yeah, I'm in the wrong job.
I honestly, I don't know.
Then I had this second thing, which is, you
don't know either.
You don't know.
Therefore, you're in the wrong job, find your
own admission.
The difference is I know, I know I don't know,
you don't.
I think I actually have an advantage.
In that strange way, I think I'm on the wrong
job.
This realization had a very big effect on
me, as an owner, I realized that not knowing
something didn't necessarily make you fundamentally
stupid, lots of other things make you stupid,
but not knowing why the payrolls are going
to be in the Friday when everyone else thought
it did was actually okay.
I think this was the a very big epiphany for
me.
RAOUL PAL: Who is a person you admire and
why?
Well, we probably talked about this with Richard
Feynman.
DYLAN GRICE: And Jim Simons.
Who do I admire?
Lots of people I admire for different reasons.
I admire Alex Ferguson, the Manchester United
manager, who I think was just a brilliant,
brilliant guy and he wrote a book called Leading.
There are so much lessons in that book about
how to manage a team, like assemble a team,
how to manage Eagles.
How to manage a bunch of people who, frankly,
are much better doing what they do than you
ever were or that you even are.
I think it's a really important principle.
Certainly, in my career, when I started my
career, it was all you wanted the best mentor
you could possibly have.
I was quite lucky, I had some very good mentor
named Albert Edwards, who you know, a great
soldier, but I've known him for years before
then.
He's always been a very good mentor for me.
There comes a point where you don't have some--
the education doesn't necessarily come from
the guys above you.
It comes from the guys below you.
It comes from the guys that you hire.
Because they're much better than you are.
They're much smarter than you are, and they
can push you and you start to learn from them.
I think that this is very much a theme in
Ferguson's book, even though they're much
better than you in lots of things, you discover
there's some things they haven't quite gotten
yet.
This was a-- he built a club, he wasn't just
a great manager, he built a club, and they
did fine, but I think he's just an intriguing
guy.
I'm reading the book on the factual biography
of Margaret Thatcher.
I think she's also a very intriguing and passionate,
very intriguing politician.
In many ways, the politician I hate, which
is a career politician.
All she ever did was politics.
I have a real suspicion of people who've never
actually done a real job in our lives other
than politics.
There's always an exception to that, and one
exception she was, so she's fascinating character
as well.
Yeah, I obviously gotten [indiscernible] there.
RAOUL PAL: Okay.
Final question.
This is probably-- you probably hold a few
of these.
What view do you hold that is most controversial
in your professional life?
DYLAN GRICE: What view is most controversial
in my professional life, God, that's a tricky
one I don't know.
At the time I felt the most embarrassed for
thinking something wasn't necessarily, it
was probably to do with the context.
It was during Brexit.
I voted for Brexit.
Okay, I was in favor of Brexit.
I was one of those idiots who didn't know
what he was doing, who was probably xenophobic
and just didn't understand, needed to have
a rethink.
Look at what the economists still say, it's
6%, that's much poorer, we're going to be
working together, are you?
I think I should see I am-- it was like a
limbo call for me.
I don't hate the European Union at all.
I can certainly see lots of benefits to stay
in the EU.
It was probably 55, 45 in favor of Brexit
for me.
For reasons, really to just to-- we live in
Switzerland, I can see how distributed power
works.
Decentralization works.
Being used to the opposite of decentralization.
The idea of taking some decision making power
from Brussels to London, I think it should
go from London to the regions, that should
be the next step.
That was basically all.
That was it.
I thought it was a reasonably-- I didn't realize
it was such a controversial view.
I happened to be at a conference, a medical
conference with lots of people who you will
know, and in Lake Como, and on the day of
the vote, and I think the odds going to bed
that evening, where the bookies odds were
like at 13%, 1-3 in favor of Brexit.
People were talking about it, but it's just
an assumption there, of course we're going
to vote to remain.
Then obviously, that's not what happened.
The next morning, the whole place was just
in shellshock.
I hadn't really realized just how remain--
because this was very establishment, there
were some very establishment politicians,
policymakers, and large hedge fund managers
and asset managers and I just haven't fully
realized that the strength appealing in favor
of remain and literally, in about 100 people
I was the only Brexit here, or the only one
stupid enough to say so.
My God, I just got an absolute, God, it was
actually vitriolic at times.
I was like shocked there.
I was an idiot.
I was total idiot.
What the hell, it was all my fault.
I was the one who came at all, I really feel
like a dummy here.
I really got this one watching the camera
on the show.
RAOUL PAL: Yeah, exactly.
Dylan, look, fantastic to get you back.
It's been a long time and far too long.
I think people are going to love this.
Lots of stuff to chew over.
Now, where do they find you to-- because you
launched a the research service, how do I
find it?
Find you, website, anything?
DYLAN GRICE: Well, probably the easiest way
to get me is on Twitter, which I sporadically,
but I spend some days engaging and then the
other things, but I met some great people
actually on Twitter when we really started
using-- RAOUL PAL: That's just amazing.
That is, if you ask me the question of how
do I stay relevant and engaged?
It's Twitter.
It changed my life.
DYLAN GRICE: It's great.
There's some just some really, really smart
people and I think really some complete dummies
as well but that isn't going to make it [indiscernible].
There's some incredibly smart people.
Connecting and reconnecting with some great
people on Twitter.
I'm on Twitter @dylangrice, and also the company
website called calderwoodcapital.com and then
the people who are distributing my research
is Eric so if people who know Eric or who
have a relationship with Eric, then they can
get me on that as well.
RAOUL PAL: Perfect.
Dylan, good to speak to you man.
Best of luck.
DYLAN GRICE: Thanks a lot.
RAOUL PAL: Take care and I'll see you soon.
