He Inspired Warren Buffett, Became A Wall Street Legend, And Made Billions

Transcript

Harley Finkelstein (00:00:00):
Our next guest, I think, is someone that when we were just thinking about the list of people, the ideal list of people we'd want on Big Shot, he was on the list. He was on the list for a couple of reasons. One, the guy's a multi-billionaire.

David Segal (00:00:12):
Right.

Harley Finkelstein (00:00:13):
Right? He, in many ways, is this iconic fixture right in on Wall Street and finance. But there is something else that I think you and I were incredibly inspired by, and that's sort of this modesty that he has. He is sort of the unlikely billionaire, although he actually [00:00:30] does correct us.

David Segal (00:00:32):
Yeah, he's a multi-billionaire.

Harley Finkelstein (00:00:32):
He says, "Well, I'm actually a multi-billionaire," but I think we're actually talking about him flying, he flies coach and we're talking about how he gets around. He's 80 years old.

David Segal (00:00:39):
He took an Uber here.

Harley Finkelstein (00:00:40):
Took an Uber here, and this is Lee Cooperman. He took an Uber here. He said, "Just so you know, I took the cheap Uber here."

David Segal (00:00:47):
Right, yeah.

Harley Finkelstein (00:00:48):
We were commenting on him taking an Uber here and flying in the economy class and on airlines, but he corrected us that he is a multi-billionaire. But the way that he thinks about his success, the thing that he believes [00:01:00] his success has given him is the ability to give back. In fact, it seems like this entirety, the entirety of his career and his ambition, all the crazy stuff this guy has done was all about to get to a point where he can eventually give back.

David Segal (00:01:15):
Lee started, he's the son of a plumber. He has very humble beginnings and incredible work ethic, and he talks about how that formed for him. He was supposed to be a dentist. That story was incredible.

Harley Finkelstein (00:01:25):
For sure. Not just that he was supposed to be a dentist. He drops out of dentistry school even though his [00:01:30] father basically gave him all the money that he had to help go to... His father was off that he left dentistry, because that's where the money was. His dad, again, is a plumber, saved a bunch of money to let him go to dentistry school, and then Lee drops out.

David Segal (00:01:42):
Lee shows us countless examples of how he uses his intuition in life, his hard work to really create his own success. When he says that thing about how he thinks about planning, I was blown away by that.

Harley Finkelstein (00:01:55):
Totally agree.

David Segal (00:01:56):
It's counterintuitive. You wouldn't think a guy who's, Omega, his [00:02:00] firm, had 10 billion under management in its heyday. It produced 13% returns over 20 years versus 9% of the S&P. This guy has had enormous success.

Harley Finkelstein (00:02:10):
Yeah, he's an icon. He's an icon on Wall Street and he says three things that has helped him become Lee Cooperman. One, hard work, two, luck, and three, his intuition. This ability to be intuitive about what's happening next, where the markets are going, it was unbelievable. Then he talks also about, one of my favorite parts was of all the investments that [00:02:30] Lee has made, both at Goldman Sachs and then of course at Omega, the famed firm, the fund that he ran with, I think, $10 billion under management.

(00:02:38):
He talks about his single most favorite entrepreneur that he ever worked with, that he ever backed. In fact, this guy, this entrepreneur that he talks of being his favorite, he's also someone that I think Warren Buffett wrote him a letter acknowledging that this is-

David Segal (00:02:52):
Even Warren Buffett's like, "This guy's the greatest guy."

Harley Finkelstein (00:02:54):
Even Warren Buffet's like, "This entrepreneur is the best." But the Lee found that he identified this person, he backed this person, and he effectively was [00:03:00] his main supporter and funding source for the entirety of this entrepreneur.

David Segal (00:03:04):
When we read-

Harley Finkelstein (00:03:05):
And I never even heard about this entrepreneur before.

David Segal (00:03:07):
Not only has Lee been successful in business, when we read what he gives away, I thought it was a typo. I couldn't believe the number. Lee gets into everything. He gets into all his secrets of success, how he learns, how to work hard, how he thinks about intuition. This is a killer episode.

Harley Finkelstein (00:03:22):
Not just that, but right now, we have to say the thing, right now, at a time where antisemitism, at least in my lifetime and your lifetime, is probably the highest it's been, [00:03:30] the highest we've experienced ever.

David Segal (00:03:31):
Definitely.

Harley Finkelstein (00:03:32):
Remember, Lee Cooperman got his MBA, went to business school at Columbia, which right now-

David Segal (00:03:37):
And is one of the biggest donors ever in Columbia history.

Harley Finkelstein (00:03:38):
He gave $15 million to Columbia, because it changed his life. To hear him talk about how he feels about what is happening right now on campus to Jewish students is remarkable. But this interview was incredible. Lee is an icon, a legend, and he's so modest and so humble, and his pet peeve, his Achilles heel are people that are arrogant. He exemplifies everything that we think Big Shots [00:04:00] have and should have. Ladies and gentlemen, Lee Cooperman.

David Segal (00:04:04):
Here we go.

Harley Finkelstein (00:04:05):
Hey, everyone. Big Shot is not just a passion project to us where we archive Jewish entrepreneurial history.

David Segal (00:04:11):
It's a way to fight hate speech and antisemitism by telling memorable stories that allow people to connect and understand one another better.

Harley Finkelstein (00:04:18):
We know stories can bring people together and these are the stories that have never been told before. This is a chance to see people like you've never seen them before.

David Segal (00:04:26):
Think about David Rubenstein, who started as the son of a postman, but built a $400 [00:04:30] billion business or Izzy Sharp who started with one hotel more than 50 years ago and today has built one of the greatest hotel chains in the world in the Four Seasons.

Harley Finkelstein (00:04:38):
Telling these stories and archiving Jewish entrepreneurial history is not just a job for two people.

David Segal (00:04:44):
We're Looking for others who want to help preserve the lessons of Jewish icons.

Harley Finkelstein (00:04:47):
We're looking for people who want to help us build this archive and can be part of the Big Shot family.

David Segal (00:04:52):
If you want to be an executive producer and you want to help fund Big Shot, please fill out the form below on this video.

Harley Finkelstein (00:04:57):
We're chasing a dream and we're looking for others [00:05:00] who feel the same obligation as us. Who feel the same passion and responsibility as we do to archive our history, to fight hate, and to bring people together.

MUSIC (00:05:11):
Started from the bottom, now we're here.

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Started from the bottom, now the whole team here.

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Started from the bottom, now we're here.

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Started from the bottom, now my whole team here.

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Started from the bottom, now we're here.

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Started from the bottom, now the whole team here.

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I done kept it real from the jump.

Harley Finkelstein (00:05:28):
Let's start at the beginning. [00:05:30] Born in a one-bedroom South Bronx apartment?

Leon Cooperman (00:05:34):
Yeah, yeah. I'm a member of the Horatio Alger Association, which is a group of self-made men and women that are generous. I have a Horatio Alger story. My father came to America at the age of 12 as a plumber's apprentice, had no education, but a very strong work ethic. We grew up in the Bronx. My brother and I shared a one-bedroom apartment.

(00:05:56):
My brother is, unfortunately, deceased, about two years ago. [00:06:00] My whole education, up until business school was public school. I went to public school, '75, in the Southeast Bronx. I went to Morris High School in the Southeast Bronx, and then I followed the advice of Horace Greeley and went west. I went to the West Bronx. I went to Hunter College, now called Lehman.

Harley Finkelstein (00:06:18):
You initially went there, I think for dentistry?

Leon Cooperman (00:06:20):
No, no. I was there a bachelor's degree. The dentistry shtick-

Harley Finkelstein (00:06:24):
Came after?

Leon Cooperman (00:06:25):
Yeah. Well, basically back in the mid-60s, if you were allowed to count your [00:06:30] first year of dental or medical school towards your fourth year of college and get a separate degree. In the summer of 1963, I went to University of Pennsylvania's Summer school. I took physical chemistry, which was my major, chemistry. That was the last course of the major, and I enrolled in the University of Pennsylvania School of Dentistry. I was good with my hands and after eight days, I started to wonder if I was pushing myself in the right direction.

Harley Finkelstein (00:06:57):
What made you wonder?

Leon Cooperman (00:06:58):
Just instinct. [00:07:00] I attribute my success, by the way, to hard work, luck and intuition. Hard work and luck is easy to understand. Intuition is difficult. I said, I give an example, the whole dentistry thing, it was a very traumatic time in my life, because basically, I paid the tuition and room and board for a year. My father, may he rest in peace, was walking around saying, "My son, the dentist." All my friends knew I was off at dental school, and so I had to-

Harley Finkelstein (00:07:26):
Was that important to your parents? I became, David knows this, but I am [00:07:30] a lawyer. I've never practiced, but I went to law school, because my parents and grandparents wanted to say, "My son, the lawyer." Why was that important to your parents?

Leon Cooperman (00:07:38):
Well, I think a professional was important. Being a professional, they didn't know Wall Street at all, and they understood dentistry and they didn't understand I was going from having my hands in people's mouth with my hands in people's pockets, which turned to be a great decision. I went to the dean of the dental school and I told him I would like to go back [00:08:00] to undergraduate school to finish off my fourth year unencumbered by any commitments.

(00:08:04):
He put me on a guilt trip. I wasn't smart enough at that time. I was young. I was probably 19 or 20 years old. I didn't understand that he could have gone to somebody on the wait list. But he said, 'You deprived the 101st applicant of a dental education," and-

Harley Finkelstein (00:08:19):
Guilt trip.

Leon Cooperman (00:08:20):
Guilt trip. I had to go to the dean of Hunter College and get permission to matriculate back into the school. He was the only one who understood [00:08:30] the difficulty of the decision and said, "Of course, you can come back." That was Glenn T. Nygren, who also is deceased. Everybody I know is deceased now. I'm at that age. I turned 81 yesterday, it was my birthday.

David Segal (00:08:41):
Congrats. Happy birthday.

Leon Cooperman (00:08:43):
Yeah, thank you. He says, "Of course you can come back." I didn't have this line at the time, but I tell the young kids I meet with, I tell them the same thing, "The only way be successful in life is to do what you love and love what you do." When I went back to Hunter, had all the electives available [00:09:00] was my major mind was complete. I took 10 courses in economics, got 10 A's and never looked back. I found what interested me, and I've worked very hard, but I love what I do.

(00:09:10):
My second example of intuition, and go back to the integration of my comments, I said that I attribute my success to hard work, luck and intuition. Second example of intuition. This is not self-serving comment, but I was an attractive package in 1966 when I was interviewing for a job. I had a 6-month-old child. I was [00:09:30] Beta Gamma Sigma, which was equivalent of Phi Beta Kappa in business. I was a recipient of the Wall Street Journal Student Achievement Award. I was straight A's in finance and I knew what I wanted. I had 16 job offers. Totally different world today, and Goldman was my fourth best offer financially.

Harley Finkelstein (00:09:45):
What was your first best?

Leon Cooperman (00:09:46):
I don't remember. Could have been Lazard or something like that.

David Segal (00:09:51):
But it was substantially more than what Goldman was offering?

Leon Cooperman (00:09:54):
Yeah, it was about $4,000 a year more, and I was dead broke. I got a call from the fellow who made me the job offer, [00:10:00] one a few times in life that I passed a deadline without acting. He said, "We're disappointed we haven't heard from you, Lee, what can we say?" I said, "Bob, let me explain. I liked everybody I met in my interviewing at Goldman. I'm dead broke.

(00:10:12):
I have a student loan to repay. I have a 6-month-old kid, but the offer was for twelve-five, and I have offers for more money. You think I can make 25,000 a year in five years?" He was from Yankton, South Dakota. His name was Bob Danforth, very lovely human being. He also is deceased. Basically [00:10:30] he said, "If you work hard and keep your nose clean, I think you could do it." I said, "Okay, I'll take the job offer."

Harley Finkelstein (00:10:35):
Was Goldman Sachs at that point-

Leon Cooperman (00:10:36):
No.

Harley Finkelstein (00:10:37):
... as prestigious as today?

Leon Cooperman (00:10:39):
No. Goldman, at that time, when I joined the firm, maybe earned $5 million a year. When I became a partner in 1976, they earned 40 million. When I retired from the firm in 1991, they earned 1.8 billion.

Harley Finkelstein (00:10:55):
You were making 1.5% of the profit [00:11:00] effectively as a partner, I believe.

Leon Cooperman (00:11:02):
I think at the time when I retired, I was more than 1.5.

Harley Finkelstein (00:11:04):
Wow.

David Segal (00:11:04):
Oh wait, that's a huge jump. 40 million to 1.5 billion.

Leon Cooperman (00:11:08):
1.8.

David Segal (00:11:09):
Sorry, 1.8. What happened in that time? What were some of the big wins at Goldman?

Leon Cooperman (00:11:14):
Well, there's the growth of the industry. They got market share, plus the industry grew. You went into the right industry and went in the right firm. I say intuition. I took a job for less money. [00:11:30] Goldman was the only firm, one of the few firms in the business that didn't change their name over 150 years. You could have gone to Goodbody, they merged out of business or got taken over. You could have gone to Lehman Brothers, they disappeared.

Harley Finkelstein (00:11:43):
Bear Stearns.

Leon Cooperman (00:11:44):
Bear Stearns, Kuhn, Loeb.

David Segal (00:11:46):
What did Goldman do that the other ones didn't? Why do you think they survived where everyone else didn't?

Leon Cooperman (00:11:51):
They just worked harder. Dress British, think Yiddish.

Harley Finkelstein (00:11:55):
Dress British, think Yiddish. What does that mean to you?

Leon Cooperman (00:11:58):
Well, just to be committed, [00:12:00] total commitment. I worked with a fellow who ran the train department, Bob Mnuchin, his son Steven is Secretary of the Treasury, and he was totally committed to what he did. I learned total commitment. I learned hard work and I enjoyed it.

Harley Finkelstein (00:12:13):
Let's go back to the decision to leave dental school and then go into finance. Your parents obviously wanted you to be a dentist, because it was a profession, it was safe. It was, from their perspective as immigrants, it was important. What'd your dad say to you when you first told them, [00:12:30] I'm going to leave dental school and I'm going to go pursue it?

David Segal (00:12:32):
Right. You used the word traumatic earlier.

Leon Cooperman (00:12:34):
Yeah, honestly, he probably was confused and concerned, but maybe probably blamed my wife at that time. Toby and I met in French in 1962, and we got married in 1964. I was at UAP in Pennsylvania and she was in New York teaching and they probably blamed her [00:13:00] for my desire to go back to New York or something. Maybe she had something to do with it. Who knows. I don't remember. I don't remember what I had for breakfast this morning. I actually had Cheerios and skim milk, but basically, I can't go back that far.

David Segal (00:13:13):
Contrast that though to when you became partner at Goldman in 1976 or '74 was it?

Leon Cooperman (00:13:16):
'76.

David Segal (00:13:20):
Your father was still alive, I believe. Right?

Leon Cooperman (00:13:22):
I called my dad. He was residing in Florida at the time. I told him I was made a partner, he started crying on the phone. He appreciate the significance of it. I didn't. [00:13:30] Again, when I was made a partner, the firm earned 40 million. I went in at three quarters of 1% and my salary I think was 50,000. I was going to make 350,000 if the firm earned what they earned. Instead, things exploded.

(00:13:49):
My interest, I did well as a partner. I had two roles. Initially, I was the firm's strategist and then when [00:14:00] I was made a partner, I was made partner in charge of research, so I had two roles. I had a role as a soloist, which was my role as a strategist. Then I had a role as a orchestra leader, where I ran the research department and I did a decent job in both ways.

David Segal (00:14:16):
Did you pay your old man back the 12 grand for the dentistry school?

Leon Cooperman (00:14:17):
I did, yeah. I paid him back. He didn't want it, but it was a lot of money to him.

David Segal (00:14:21):
Sure.

Leon Cooperman (00:14:21):
Different worlds. Like look at baseball. What did Mickey Mantle make a year? 100,000. Now, they-

David Segal (00:14:27):
Now it's tens of millions.

Leon Cooperman (00:14:28):
Yeah. I just had an experience [00:14:30] recently, which kind of makes me bearish about things. I was honored by the New York Yankees and I threw out a pregame pitch. Technically, I was the guy on it, but I have a torn rotator cuff and I imported my son from Vermont.

Harley Finkelstein (00:14:43):
To throw the pitch?

Leon Cooperman (00:14:45):
Throw the pitch, and he threw a perfect strike. But what I was shocked about is a bottle of water was six bucks. A hot dog was eight bucks. I bought my grandson. I have a 15-year-old grandson, a New York Yankees cap, $56 [00:15:00] is really crazy.

Harley Finkelstein (00:15:00):
It's a crime.

Leon Cooperman (00:15:01):
Yeah, it's crazy. Then the thing that I found most surprising, when I grew up in the Bronx, it used to be an old man called Pop, come around in a carriage and a white laundry bag full of pretzels, two for a nickel. $13 for a pretzel.

Harley Finkelstein (00:15:13):
For one?

Leon Cooperman (00:15:14):
For one. It was bigger back then, but same pretzel. Then I recently and I bought a 2017 Hyundai for $54,000. I went to see a trade in to a 2022, [00:15:30] same exact car, 104,000, no discounts.

David Segal (00:15:35):
Crazy. I'm hearing you change your own light bulbs too.

Leon Cooperman (00:15:39):
I never learned how to live rich.

Harley Finkelstein (00:15:41):
Let's talk about that. You are Lee Cooperman. You are an icon, a legend. Even before we met, everyone knows who you are. From a Wall Street perspective at Goldman, but also at Omega, which you've built. We want to talk about Omega as well. You are a legend in this industry and frankly, [00:16:00] you're incredibly successful. Why are you... I'll take that. I'll put that right here. Why are you driving a Hyundai?

Leon Cooperman (00:16:12):
Because I look at cars as transportation. Look, I figured out a long time ago, there's only four things you could do with money. This explains my philanthropy. First thing you do with money is you could spend it on yourself. I have found over the years that mature possessions brings with you as much aggravation as pleasure.

Harley Finkelstein (00:16:30):
[00:16:30] Yeah. They started owning you kind of thing.

Leon Cooperman (00:16:31):
Yeah. I don't collect art. I missed that game. I'm not bragging. I missed it. I'm not big into sports teams, and I'm not big into luxury. I'm not cheap. I'll be honest with you. Anything I want, I get, but I don't want very much. My wife and I have very, very different political philosophies.

(00:16:49):
I'm more conservative, more Republican than she is. She's a socialist. I say to her, "You could be a socialist if you're married to a capitalist. It makes it painless." [00:17:00] But we both have the same values and we're not accumulators of things.

Harley Finkelstein (00:17:06):
The first thing you can do with money is personal.

Leon Cooperman (00:17:08):
Personal. Spend it on yourself. Buy planes. Buy cars. Buy art. Buy teams. I'm not-

Harley Finkelstein (00:17:13):
You don't want that?

Leon Cooperman (00:17:14):
I don't need that. I don't want that. I'm not interested in that.

Harley Finkelstein (00:17:16):
A Hyundai, for you, is a good value. It's a good car. It gets you from when A to point B.

Leon Cooperman (00:17:19):
Yeah. Be honest with you, because they don't want to pick me off. It's a Genesis, Hyundai.

Harley Finkelstein (00:17:24):
Okay, so it's a nicer, nicer Hyundai.

David Segal (00:17:26):
Souped up Hyundai.

Leon Cooperman (00:17:27):
Yeah. Souped up Hyundai, right. The second thing you do, you might give it to your [00:17:30] kids, but if you have a lot of money, giving all your money to your kids is a mistake, because you deprive them in self-achievement. I have two boys that are very achieved and I'm very proud of. One graduated Stanford Phi Beta and then got an MBA from Wharton. The other one is a scientist, has a PhD degree from Oregon State, and he's a scientist.

Harley Finkelstein (00:17:48):
Wow.

Leon Cooperman (00:17:49):
Third thing you can do with money, give it to the government, but only a fool gives the government money. You don't have to.

Harley Finkelstein (00:17:52):
Pay taxes.

Leon Cooperman (00:17:52):
Pay your taxes, that's it. You don't volunteer to pay more. The fourth thing you do with money is recycle back into society and try to make the world a better place.

Harley Finkelstein (00:17:59):
That's philanthropy [00:18:00] for you?

Leon Cooperman (00:18:01):
That explains my philanthropy and that's what we've done. Healthcare and helping inner city kids are high on my list. I gave $50 million to create a fund called Cooperman College Scholars. We paid--

Harley Finkelstein (00:18:12):
50 million?

Leon Cooperman (00:18:13):
50 million.

Harley Finkelstein (00:18:13):
Wow.

David Segal (00:18:14):
Well, actually, we were reading the show notes in advance, and I had to ask our producers, is this a typo? I believe you've given almost $1 billion away so far.

Leon Cooperman (00:18:21):
Could be. I don't even know the total number. But--

David Segal (00:18:23):
It's up there.

Harley Finkelstein (00:18:24):
Wow.

Leon Cooperman (00:18:25):
Yeah. I'm giving away all my money. I don't even know what I'm worth, to be honest with you. [00:18:30] These surveys, which I'm only more impressed by what people do with their money, know how much they have. I love Ken Langone. My only envy of him is he has so much more money to give away.

(00:18:41):
But he's one of the generous, finest gentlemen I've met in the business. I've given 50 million to create this Cooperman College Scholars. I gave 125 million to St. Barnabas Medical Center. They dropped the Saint for a Jew. It's now called Cooperman & Barnabas. It was their idea.

Harley Finkelstein (00:18:56):
Why did they drop the name?

Leon Cooperman (00:18:58):
They were hopeful that I could do [00:19:00] for them what Ken Langone has done for NYU, which is a major transformation. I don't have his influence. I don't have his far reach, but I try to do my best.

David Segal (00:19:09):
You've also given a lot to Columbia.

Leon Cooperman (00:19:11):
I gave 50 million to Columbia. I got some recent publicity where I said, "I'm not going to give." That's technically not true. First of all, I gave the money already.

Harley Finkelstein (00:19:21):
Just to backtrack here, you did your MBA at Columbia.

Leon Cooperman (00:19:25):
Columbia helped change my life, because not to say that it's right, but Goldman probably never would've hired [00:19:30] me out of Hunter College.

Harley Finkelstein (00:19:31):
Right. Columbia was an Ivy League school. Amazing program.

David Segal (00:19:33):
It was your golden ticket.

Harley Finkelstein (00:19:34):
It was your golden ticket.

Leon Cooperman (00:19:35):
Yeah.

Harley Finkelstein (00:19:35):
So you went back and you gave them $50 million.

Leon Cooperman (00:19:37):
Over years.

Harley Finkelstein (00:19:38):
Over the years. Columbia is right now in the news for having a lot of protests, specifically where Jewish students there don't feel safe on campus. You then came out very publicly and said, "I'm halting this for now, until they clean up their act."

Leon Cooperman (00:19:51):
Figure it out.

Harley Finkelstein (00:19:51):
They figure it out.

Leon Cooperman (00:19:54):
Yeah.

Harley Finkelstein (00:19:54):
What do you think is going on there?

(00:19:54):
This Big Shot thing is super fun. We're having a great time. People are loving it. It's [00:20:00] a little expensive, just to say it. At the end of the day, we are-

David Segal (00:20:04):
I'm glad you said it.

Harley Finkelstein (00:20:05):
We're still stingy Jews here. It's really quite expensive. You and I are funding this whole thing ourselves.

David Segal (00:20:10):
Not true.

Harley Finkelstein (00:20:11):
I think at the very least, we should at least promote our tea business.

David Segal (00:20:15):
You all see the production quality.

Harley Finkelstein (00:20:17):
The production quality is incredible. We have an amazing staff, tons of producers, and it's a little expensive.

David Segal (00:20:23):
Yeah. I'm obsessed with tea. I built DAVIDsTEA. I left many years ago, and Harley, actually, [inaudible 00:20:29]-

Harley Finkelstein (00:20:29):
I can't believe we're doing this. [00:20:30] This is perfect.

David Segal (00:20:30):
We're doing this, because we have great tea, but we also, we got to pay for Big Shot.

Harley Finkelstein (00:20:36):
Perfect.

David Segal (00:20:37):
Harley got me back into tea. I would curate these green tea collections for you, having trouble sleeping in the evenings. I'm like, "Oh, you got to drink, switch coffee. You don't need 10 coffees a day."

Harley Finkelstein (00:20:45):
If we're going to tell the story, let's tell the story. I had been drinking so much during the pandemic. I was by myself, obviously, like the rest of us were, and I was drinking a ton of coffee and my anxiety was peaking. Actually, you had said you should switch off of coffee in the afternoon and move to really high quality [00:21:00] green tea.

David Segal (00:21:01):
The caffeine and green tea interacts differently. You don't get the big spike and crash.

Harley Finkelstein (00:21:05):
It's like a calm alertness, almost.

David Segal (00:21:06):
A calm alertness and green tea's amazing, really high quality green tea. Then-

Harley Finkelstein (00:21:11):
But frankly, like most people, I had never had high quality green tea. Most of the tea that I had consumed in my life, it was like in a gift. I'd give a talk somewhere and they give me a gift box or some sort of gift package, and there'd be some random tea bags in there. But I had never actually had really high end green tea.

(00:21:26):
You, very kindly, started curating this box of incredibly [00:21:30] high-end, amazing green tea. You also began to sort of jerry-rig these accessories for me. You'd say drop it in here for three minutes and then take it out. Make sure it's not steaming. You just created this incredible tea setup for me. In fact, you know this, but next to my home office, I now have a little tea area that you actually created for me.

David Segal (00:21:49):
Right.

Harley Finkelstein (00:21:49):
But green tea in particular, and having you curate this tea for me was this incredible new element of my life, because it allowed me to stay really energized, really focused in the afternoon without [00:22:00] having any issue with sleeping.

David Segal (00:22:01):
That was the inspiration for Firebelly. Finally, you're like, "Let's do it. I'll be your partner." We started Firebelly Tea. Most people want to take a tea bag and dunk it in the water. The reality is there's this rich experience you can get with tea where you take the time to make it properly, whether it's green tea, black tea, oolong tea, herbal teas. We're doing something special with Firebelly.

Harley Finkelstein (00:22:21):
Yeah. Firebelly is the highest, the best tea. Actually ,you got a chance to design every single accessory yourself.

David Segal (00:22:28):
Absolutely.

Harley Finkelstein (00:22:28):
You went ahead and figured out this is the best [00:22:30] teacup. This is the best strainer for it. This is the best whisk in terms of how to make great matcha. But this is the best tea and the best tea products ever. Please buy our tea. We need a way to pay for more Big Shot episodes, so we don't need your money, but we would appreciate you buying some amazing green tea from firebellytea.com. It is not just a pitch. It is also the greatest tea ever and it would make us really happy.

David Segal (00:22:55):
If you don't like it, we'll give you your money back.

Harley Finkelstein (00:22:56):
No, no, we won't do that. We're not giving the money back.

David Segal (00:22:58):
Why not?

Harley Finkelstein (00:22:58):
We're keeping your money money. [00:23:00] You're going to love it.

David Segal (00:23:00):
But you're going to love it. You're going to love it.

Harley Finkelstein (00:23:00):
All of a sudden, you're such a Big Shot, you're giving people's money back, give don't money back.

David Segal (00:23:04):
You'll give it as a gift. It makes a great gift.

Harley Finkelstein (00:23:06):
It's a great gift. It's great tea, it's great accessories. You actually will really, really love it and allow us to pay for more of these Big Shot episodes. That's our pitch. All of you must be laughing wherever you're sitting right now watching this. We don't care. We have-

David Segal (00:23:20):
We actually know tea well though.

Harley Finkelstein (00:23:21):
We also know e-commerce well too.

David Segal (00:23:23):
Yeah, true.

Harley Finkelstein (00:23:24):
We know e-Commerce, we know tea, Firebelly Tea. Go buy some, help us pay for more Big Shot episodes. [00:23:30] I know our audience. I know our audience well. They're going to say, "Yeah, we love your tea. We want to buy from you. We want to support Big Shot. Is there a coupon code?" I'm going to get my aunt's or someone in my family's going to call me and be like, "I love the tea. It's really great. Can I get a discount?" Is there code we can give them?

David Segal (00:23:47):
BIGSHOT15.

Harley Finkelstein (00:23:48):
BIGSHOT15. Okay.

David Segal (00:23:49):
BIGSHOT15.

Harley Finkelstein (00:23:49):
Use code BIGSHOT15 for 15% off our tea and tea accessories. If you don't like the tea and you don't like the accessories, David will give you your money back. I will not. He will. That's it.

David Segal (00:24:00):
[00:24:00] I'll give you your money back. I got you.

Harley Finkelstein (00:24:01):
All right. I won't.

Leon Cooperman (00:24:03):
Well, it reminds me of the Vietnam War demonstrations, 1960s, '69, I guess it was. There's no parallel in my opinion. These kids, I've said this publicly, have shit for brains. They don't understand. The only ally, reliable ally that United States has in the Middle East is Israel. The only democracy in the Middle East is Israel. Israel, there's a group called Gays [00:24:30] for Palestine. It's amazing. Israel is the only country in the Middle East that allows gays and lesbians practice what they practice.

(00:24:37):
In other countries, they would behead them if they could. Then Israel got the money from the West and did very constructive things. The Palestinians allowed the Hamas to get a hold of the money and they built tunnels. This war was created by Hamas. Israel was a victim. I can't imagine anybody telling the United States how to react after Pearl Harbor [00:25:00] or how to react, to tell general Dwight Eisenhower how to conduct the war in Europe. It is crazy what's going on. These kids have no idea why they're demonstrating.

Harley Finkelstein (00:25:08):
Yeah. It's also probably from your perspective, given you are so connected to Colombia, it probably makes you feel pretty sad about that.

David Segal (00:25:15):
It's disheartening.

Leon Cooperman (00:25:16):
Well, it's sad, because I think where they have failed is they're supposed to create a safe environment, a conducive environment. They failed in doing that, they didn't pay enough attention, but I think they'll wake up. Right [00:25:30] now, I think they're being overwhelmed by things they can't control. There's a lot of undesirables that are now involved, getting on the campus doing things. They'll straighten that. That's just not Colombia, it's University of Southern California I see having it-

Harley Finkelstein (00:25:46):
Or Harvard's had it. A bunch of the schools-

David Segal (00:25:48):
Starting to now.

Leon Cooperman (00:25:50):
Yeah. I'm hoping that they respond more intelligently going forward, and I think they will.

Harley Finkelstein (00:25:53):
Do you think that, just on the topic of anti-Semitism, do you think, I mean, how has things evolved over your lifetime? Dave and I both [00:26:00] obviously are very proud Jews. My grandparents are Holocaust survivors. My father's a Hungarian immigrant who came to Canada as a Jew during the revolution. For him, his hope was that for our generation and for our children's generation, that we wouldn't have to suffer the same type of anti-Semitic rhetoric.

Leon Cooperman (00:26:16):
Yeah, it's shocking. I don't understand the basis for anti-Semitism. I think there are 15 million Jews in the world.

Harley Finkelstein (00:26:20):
15 million Jews on the planet.

Leon Cooperman (00:26:21):
15, yeah, in the world.

Harley Finkelstein (00:26:22):
One-five, yeah.

Leon Cooperman (00:26:24):
Seven and a half million live in Israel, five million live in the United States, and the rest are spread around the world. [00:26:30] Even though we're only 2/10 of 1% of the global population, 20% of the Nobel Prizes have gone to Jews. We've done a lot for the world. There's no basis for anti-Semitism.

Harley Finkelstein (00:26:39):
Why?

David Segal (00:26:40):
One half of the hospital network is built by the Jews. The donations to the schools, the hospitals. The amount that we give back-

Leon Cooperman (00:26:46):
I'm not sure what it stems from. I guess it's maybe penis envy. We're so successful that people take a shot at us. I don't know.

Harley Finkelstein (00:26:56):
Why do you think Jews have been so disproportionately [00:27:00] successful?

Leon Cooperman (00:27:01):
Well-

Harley Finkelstein (00:27:02):
What is it about us?

Leon Cooperman (00:27:03):
We're hardworking, we're smart and we're goal-oriented. I have very average intelligence in my opinion, and I've worked very hard to get where I got.

Harley Finkelstein (00:27:11):
You believe that hard work was your secret? You talked about hard work, luck-

Leon Cooperman (00:27:15):
And intuition.

Harley Finkelstein (00:27:16):
Intuition, yeah. But you think hard work is a major piece of the Jewish story?

Leon Cooperman (00:27:21):
Sure. The harder I work, the luckier I got.

David Segal (00:27:23):
Where'd you learn that work ethic?

Leon Cooperman (00:27:25):
My father. My father worked six days a week and he was on call for the 7th day. [00:27:30] You have certain approaches. I remember many, many years ago, this brings back stories where I was a waiter at Levy's Grand View Lodge in Colchester, Connecticut. Every so often, we had to clean out the water pitchers, which were stainless steel. I did a very good job one year. All the other guys was complaining, you're creating problems for us. You're doing such a good job.

David Segal (00:27:57):
You're making them look bad.

Leon Cooperman (00:27:59):
Yeah.

David Segal (00:27:59):
You worked from a [00:28:00] very young age, I believe.

Leon Cooperman (00:28:02):
I did. My first job, I changed tires at J&T Tire Shop in the Bronx.

Harley Finkelstein (00:28:11):
How old were you? How old were you at that time?

Leon Cooperman (00:28:13):
Probably 15, 14.

Harley Finkelstein (00:28:14):
Wow.

Leon Cooperman (00:28:16):
I didn't appreciate the significant. Then after that, my first real job, I was an usher in the Loew's Paradise Theatre on the Grand Concourse for 50 cents an hour, 55 cents an hour. It was interstate commerce, so minimum wage didn't apply. When I [00:28:30] was working there, they were showing the 10 Commandments, Moses, Moses. I saw it about 100 times.

Harley Finkelstein (00:28:35):
Amazing.

Leon Cooperman (00:28:38):
That was my first job. Real job.

Harley Finkelstein (00:28:41):
You've been working pretty much your whole life and you're now 81, you said you celebrated your birthday.

Leon Cooperman (00:28:45):
Yes.

Harley Finkelstein (00:28:46):
And you're still working.

Leon Cooperman (00:28:47):
Well, I work for myself. I tell everybody, "I'm like Hyman Roth in Godfather Two." Right before they shot him at the airport, he said, "I'm a retired executive living on a pension." I'm a retired money manager living on my [00:29:00] investment income. The bad news on that is I used to have a big income. I made a lot of money as a hedge fund operator. I don't have that anymore. The good news, I have no pressure, because I'm managing my own money.

Harley Finkelstein (00:29:11):
Well, you have one LP, which is you.

Leon Cooperman (00:29:12):
Me and my son, my youngest son. My oldest son manages his own money. He's very smart.

David Segal (00:29:18):
Let's talk about Omega. You had this enormously successful career at Goldman Sachs for 25 years, and then you finally decide to leave and start Omega the next day. What did your-

Harley Finkelstein (00:29:29):
And not just successful, but you were making [00:29:30] a ton of money at Goldman Sachs.

Leon Cooperman (00:29:32):
Yeah, my last year, I made 1.75% of 1.8 billion.

Harley Finkelstein (00:29:37):
It's unbelievable.

David Segal (00:29:38):
Yeah.

Harley Finkelstein (00:29:39):
What was that conversation like at home? How did, you know?

Leon Cooperman (00:29:42):
Well, I wanted to do something different. What you got to understand is how this speaks to my limited influence at Goldman. But for 10 years I was telling Goldman, "You're making a big mistake by not going into asset management." For 10 years, they said, "Lee, you don't understand. We believe brokers [00:30:00] do brokerage, money managers do money management. Don't compete with your customer, because we're an institutional broker."

(00:30:05):
I said, "Look, wake up and smell the roses. You have Merrill Lynch Asset Management. You have Kidder, Peabody, which was Webster. You have CSFB, and they're in business. The only firm that was not in the business of managing money and doing brokerage was Salomon Brothers, which was Goldman's arch trading rival. One day Salomon announced that, Bob Salomon Jr, a real gentleman, was leaving the research department to start Salomon Brothers Asset Management.

Harley Finkelstein (00:30:29):
Wow.

Leon Cooperman (00:30:30):
[00:30:30] Bob Rubin and Steve Friedman called me up and said, "Look, we made a mistake. We should have done this earlier."

Harley Finkelstein (00:30:34):
You were right.

Leon Cooperman (00:30:35):
Yeah. I was a man ahead of my time, I guess you could say. Because now I read the paper, everybody wants to be in asset management.

Harley Finkelstein (00:30:40):
It's all asset management. Yeah.

Leon Cooperman (00:30:41):
They came to me and said, "Would you be willing to leave research and start asset management business for us?" At that time, as I mentioned earlier in this conversation, I carried wood on two shoulders. Right? I was a strategist. I was number one for nine straight years in the II poll. You can only go down from there, right?

Harley Finkelstein (00:30:57):
And your research.

Leon Cooperman (00:30:58):
The research department, when I took it over, it was [00:31:00] unranked. Due to Goldman's budgetary support and the integration of trading and research and sales, we became number one in research.

Harley Finkelstein (00:31:08):
Wow.

Leon Cooperman (00:31:10):
We were number one where I was the orchestra leader. We were number one where I was a soloist. I was ready for a change. Then when I say with a smile, I made a mistake, which was very clear. Goldman being the great firm that it is, understood that assets and the management times fee equal revenue. They wanted to capture all the money to be captured. I was interested in performance of the assets.

(00:31:30):
[00:31:30] After about a year when I saw they wanted to be on the road raising money all the time, and I wanted to spend time visiting companies and finding good stocks to buy, like maybe your stock or other stocks, I told them I wanted to retire. They tried to convince me not to do that. But my wife Toby crystallized the decision. She said, "How old are you going to be and how rich are you going to be before you do what you want to do?" When I was at Goldman, I was probably worth about $100 million. I made the big money in the hedge fund.

Harley Finkelstein (00:31:59):
Can you repeat, what did Toby say?

Leon Cooperman (00:32:00):
[00:32:00] She said, "How old are you going to be and how rich are you going to be before you do what you want to do?"

David Segal (00:32:06):
How old and how rich do you have to be, do you think, to do what you want?

Leon Cooperman (00:32:08):
Well, I don't care about money. I'm giving it all the away.

Harley Finkelstein (00:32:10):
But you're worth $100 million, at that point. You're making a ton of money at Goldman. You're the man. To leave at that point seems crazy.

Leon Cooperman (00:32:20):
Well, if you have $100 million and you're not an art collector, you're not a spendthrift, you have all the money you need the rest of your life. None of my decisions, my early decisions [00:32:30] were motivated by financial decisions, but my decisions in life have not been motivated by finance. I've been very blessed. I've been very lucky.

Harley Finkelstein (00:32:38):
You decide to leave and start Omega. First of all, why call it Omega?

Leon Cooperman (00:32:41):
Well, if you know the Greek alphabet, Alpha is the beginning. Omega is the end. This was my Omega. My next trip was into philanthropy.

Harley Finkelstein (00:32:49):
You knew that would be your last stop, career wise?

Leon Cooperman (00:32:52):
Yes, yes.

David Segal (00:32:53):
Omega has been incredible. You guys have had a 13%, I believe, average return when the S&P is about a 9%.

Leon Cooperman (00:32:59):
Yeah, [00:33:00] we did well. I think the SEC helped me make that decision. They falsely and inappropriately charged me with inside trading. I spent 10 million defending myself. At the end of the day, they knew what happened. I had owned the stock for 10 years before.

(00:33:19):
I got one new accountant. I bought some stock at, period. I did know something, but I didn't know the conclusion. I didn't buy it for myself. I didn't buy it for my wife. I didn't buy it for my kids, but-

Harley Finkelstein (00:33:29):
Bought it for clients.

Leon Cooperman (00:33:30):
[00:33:30] I bought it for one new client.

Harley Finkelstein (00:33:31):
One new client.

Leon Cooperman (00:33:31):
And it was a 2% addition to our position. But they try to get notch on their belt and they want to take that notch and trade it for a job in the private sector.

Harley Finkelstein (00:33:40):
Taking down Lee Cooperman's a big deal.

Leon Cooperman (00:33:42):
Yeah. Right, right. Exactly. What happened is the institutions fled, because they're fire, aim, ready. The individual's, wealthy individuals, like Ken Langone and Jack Welch and people like that either gave me more money or they encouraged me. [00:34:00] But we had a big draw-down and over half the money was my own money. I figured, what the hell? Why take the pressure? I might as just run my own money.

David Segal (00:34:07):
Right.

Harley Finkelstein (00:34:08):
Then you had also, along the way of these great successes, you had some stumbling blocks also. You also had an executive from Goldman who was a friend, come in and you lost 125 million bucks, I believe, with him.

Leon Cooperman (00:34:20):
That was the Republic of Azerbaijan. You've done your homework. Yeah, that was Clayton Lewis. Again, another example of-

Harley Finkelstein (00:34:27):
You brought Clayton Lewis with you from Goldman to Omega.

Leon Cooperman (00:34:29):
I didn't bring him with [00:34:30] me, I hired him.

Harley Finkelstein (00:34:30):
You hired him from-

Leon Cooperman (00:34:31):
Later. After I was in business for a couple of years.

Harley Finkelstein (00:34:34):
You said, Clayton, "You're a good guy. Come over."

Leon Cooperman (00:34:36):
No, no, no. I didn't know him at all. He approached me and I hired him. He emphasized the importance of integrity, et cetera. He turned out to lead the firm into a deal tainted by corruption, which he knew about. This guy, Viktor Kožený, The Pirate of Prague.

David Segal (00:34:55):
The Pirate of Prague. Wow. What a name?

Leon Cooperman (00:34:58):
I didn't know anything about him, [00:35:00] but we made the investment. It turned out that Kožený knew or I believe he knew that the government had bribed by him, but he was fleeced by the government, because they never honored what he thought they were going to do. Clayton Lewis, he screwed me big time. But again, I fought back. I was the biggest loser in his voucher privatization programs, [00:35:30] but I learned a lot about government.

David Segal (00:35:33):
Yeah. Right.

Harley Finkelstein (00:35:34):
Let me ask you a question. Two examples. One is the SEC insider trading case, which you fought and ended up winning. There's also obviously the Clayton case where you ended up losing a bunch of money. For you, which hurt more?

Leon Cooperman (00:35:51):
I don't know. Neither. What hurt the most was the knowledge [00:36:00] that the government is not out for the truth. They're just out to get a notch on their belt.

Harley Finkelstein (00:36:06):
Gotcha.

Leon Cooperman (00:36:07):
And the system is all screwed up.

David Segal (00:36:13):
You're very much in the public eye. I read a story that I thought was so interesting where Dr. Singleton was advocating for share buybacks and holding cash. Tell us that story. What happened there?

Leon Cooperman (00:36:25):
Well, the smartest guy I ever dealt with was Dr. Henry Singleton.

Harley Finkelstein (00:36:29):
What makes him so [00:36:30] smart?

Leon Cooperman (00:36:31):
Well, his record, but let me just tell you a little bit about him. He graduated number one in his class in the Naval Academy. He went on to MIT and got a PhD in electrical engineering. He was a senior executive at Litton Industries in 1958. Tex Thornton, the founder, promoted Roy Ashton to become the CEO. Singleton left after that decision to start Teledyne.

(00:36:54):
Teledyne is a contraction of two Greek words, tele, which is distant, dyne, which is force. A little translation of Teledyne [00:37:00] is distant force. They had about 30, 35 people in the home office. The widgets were made in the field. They returned the money to the home office. The home office, meaning Singleton decided what to do with the money. From 1958, when he was founded, to 1968, he did 130 acquisitions, multiple arbitrage. Then we had lunch one day in 1968 and we're having lunch at the Yamato's restaurant in the back of Century Plaza.

(00:37:26):
Yamato's restaurant is no longer here, Century Plaza, I think, it's converted to [00:37:30] some kind of residential type of operation. He said, "The acquisition game for Teledyne's over. It makes no sense to take undervalued auction market stock and pay private market value. I'd bid private market value by businesses."

Harley Finkelstein (00:37:43):
They're not, it's all liquid.

Leon Cooperman (00:37:45):
Well, that was not his concern. His concern was you're not accomplishing anything by overpaying for business you acquire. So he said, "The acquisition game for Teledyne's over." At that time, people like George Scharffenberger running City Investing, Walter [00:38:00] Kidde, Fred Sullivan ran Walter Kidde, Harold Geneen of ITT were still doing deals. They weren't getting anywhere.

(00:38:07):
Then, in 1972, he was brilliant in his acquisition of businesses. Then in 1972, he made the decision that his stock was undervalued. On eight occasions, he did self-tender offers and he retired 90% of his stock and nobody understood stock repurchase. The article you're referring to is I wrote a letter to Businessweek. They had him on the cover of Businessweek in August of 1982, [00:38:30] criticizing him for his stock repurchase. 40 years later, their trading on repurchase.

Harley Finkelstein (00:38:35):
Everyone's doing it.

Leon Cooperman (00:38:36):
He's buying it at six times earnings at a big discount.

David Segal (00:38:40):
You wrote about, in defense of him.

Leon Cooperman (00:38:41):
Yeah, yeah, yeah. I did.

David Segal (00:38:42):
Why did you feel you had to write about it?

Leon Cooperman (00:38:45):
Well, I had a fetish. Every time people say, "What stock you like?" I would say, "Teledyne." So when somebody attacks him, I feel an obligation to my investors, my clients at Goldman to explain my position. [00:39:00] He acquired his stock brilliantly. In fact, if you look at it, I don't want to get too technical. On three of the eight occasions, he offered bonds in return for stock. If you look at interest rate changes since then, he picked the top of the bond market and the bottom of the stock to make these exchanges.

(00:39:17):
The guy was absolutely brilliant. Then the third thing he did, which he never fully explained, he broke Teledyne up into four companies, Unitrin, which is a multi-line insurance company, Argonaut, a workers' [00:39:30] compensation company, American Ecology, waste management, and Teledyne, the manufacturer. When I quizzed him about it, he said, "Well, you know, Teledyne has never had a stock option program, but I don't think it made sense to pay the manufacturing executive for what the insurance guy is doing and vice versa.

(00:39:48):
Now they'll have pure companies, basically, we can put an option program to incentivize people." Secondly, he said, "I don't know how GE does it, you get a company where you get the capability of an executive like a Jack [00:40:00] Welch that could run all these diverse piece of business. By simplifying the business, I'll focus people down on their responsibilities." I think the real reason is if you sell a division as part of the company, you're subject to double taxation.

(00:40:17):
You pay tax on the disposition and then you pay tax as the company is ultimately wound down. He avoided that double taxation. Because if Argonaut or Unitrin was taken over, [00:40:30] and they were separate from Teledyne, there wouldn't be double taxation. Each one of his companies was bid for within a couple of years after he did the spin out, so he was brilliant about that. He died from brain cancer. He read a book a day.

David Segal (00:40:43):
He read a book a day?

Leon Cooperman (00:40:44):
Yeah, a book a day. A book a week. I forget.

David Segal (00:40:46):
Wow. The article you wrote, though was-

Leon Cooperman (00:40:47):
He played chess blindfolded. Every move was committed to memory. The guy was brilliant.

David Segal (00:40:52):
Wow. The article you wrote though was extremely well received, I believe.

Leon Cooperman (00:40:55):
But my clients, I told Businessweek, Businessweek, they controlled the printing press. [00:41:00] They had one paragraph out of a 7-page letter in the letter to the editor.

David Segal (00:41:03):
Right. You even had some other major financiers.

Leon Cooperman (00:41:07):
He who laughs last, laughs best.

David Segal (00:41:10):
Right.

Leon Cooperman (00:41:11):
I got my vent. The guy was dead wrong who wrote the article. The stock went up multiple times. It was my biggest win next to Lynn Broadcasting.

David Segal (00:41:20):
You had some supporters as well from some of your peers.

Leon Cooperman (00:41:22):
Yeah.

David Segal (00:41:24):
Who sent you that letter that you framed, I believe?

Leon Cooperman (00:41:27):
Oh, Warren Buffett.

David Segal (00:41:28):
Yeah. [00:41:30] Right.

Leon Cooperman (00:41:30):
That's the biggest mistake I have in the business. I always thought very well of Buffett. He sent me a letter praising my research. He sent me a letter. It said, "Dear Lee, your letter to Businessweek on Teledyne was 100% on the mark. Best regards, Warren." He wasn't famous. This was 1982. I put that letter on the wall and he became famous, what I should have done is bought the stock.

Harley Finkelstein (00:41:55):
Forget the photo on the wall, buy the actual stock.

David Segal (00:41:57):
Why don't you buy it now?

Leon Cooperman (00:41:59):
He has got so [00:42:00] many accolades and he is so well thought of for the right reasons that I don't think I'm adding any value.

David Segal (00:42:06):
You know the Jackie Mason joke, right?

Harley Finkelstein (00:42:07):
This is our favorite joke.

David Segal (00:42:08):
Yeah. A guy's walking down the street with his friends, Saul and Harley are down the street-

Leon Cooperman (00:42:15):
Buy it tomorrow.

David Segal (00:42:16):
Right? Yeah. He goes, "You see that building? I could have bought that building for $2 million." His friend turns to him and he goes, "Why don't you buy it now?" He's like, "Ah, it's too expensive."

Leon Cooperman (00:42:27):
I thought it was going to be Abe was walking down the street. He met Sammy. [00:42:30] He says, "Sammy, I heard about your fire and your factory burned down." He says, "My condolences." He says, "Shh. Tomorrow."

Harley Finkelstein (00:42:41):
There is obviously a theme, Lee, with your career, which is thoughtfulness, discipline, hard work, all that, insight, all that. But there's also, you seem to love what you do. There seems to be-

Leon Cooperman (00:42:52):
Yeah. Well, I do a lot of talking at schools and I tell them, "The only way to be successful is to do what you love and love what you do."

Harley Finkelstein (00:42:56):
And so what do you love doing? What is the thing?

Leon Cooperman (00:42:59):
I Like [00:43:00] finding things that somebody don't see, making a bet and having Mr. Market prove me right.

Harley Finkelstein (00:43:05):
Alpha.

Leon Cooperman (00:43:05):
For two reasons.

Harley Finkelstein (00:43:06):
Yeah. One reason is I have an ego, like everybody else. You want to be right. Number two, I want to give away my money. The more money I make, the more money I have to give away.

David Segal (00:43:19):
What do you love about giving money away?

Leon Cooperman (00:43:21):
Well, you're helping people less fortunate. You're improving the world. [Latin 00:43:25].

Harley Finkelstein (00:43:26):
Yeah. [Latin 00:43:27]. There is a way though that you also give it away. David [00:43:30] and I, obviously, we're just starting to think about philanthropy and charity and on our own, in many ways, Big Shot is our way of thinking. How can we uniquely use our skill set to tell the story of incredible people, incredible Jews, like you.

(00:43:42):
You take a very entrepreneurial approach, it seems, to philanthropy and most people just kind of give money to a charity or a foundation and hope for the best. You seem to be a lot more integrated into where you're giving. Is that a new thing you've done? Is that something that you've always done?

Leon Cooperman (00:43:57):
Well, I try to have accountability. [00:44:00] I'll give you a best example.

Harley Finkelstein (00:44:03):
Okay.

Leon Cooperman (00:44:04):
I was giving you a little bit of money, like $1,000 a year to something I knew nothing about called Songs of Love. One day, I decided to learn something more about it and to show you how bad my timing is, I picked a Saturday to go out to Queens and it was a Saturday where one, two, where the Midtown tunnel was closed and I was driving from New Jersey. It took me three hours to get there, three hours to get home. But what I found, there's 17 volunteers that were totally committed [00:44:30] and I wrote them a check for $1 million on the spot.

Harley Finkelstein (00:44:33):
That's a big jump from $1,000.

Leon Cooperman (00:44:35):
Yeah, but I found out what they were doing. My philanthropy is directed towards people that have hands-on that I know. They're doing good things. I don't try to micromanage it, but I do get involved. I'm not as involved as you portray, which you're very kind, but it's getting hard. Particularly [00:45:00] now, I'm getting many more demands. I'm on the radar screen. I get 10 emails a day looking for money for Israel, given what's happened there.

(00:45:12):
I given my daughter-in-law, Jodi, who's terrific and her two kids are equally terrific, the responsibility for Jewish giving. I went to a Maguén David meeting recently, and there were, I think, 13 empty chairs with uniforms on [00:45:30] the chairs. I asked him what the significance was, and he says, "There were 13 medics that were killed on September 7th." I said, "Okay, what I want to do is I want to buy 13 ambulances, only on the condition to be named, each one be named one of the deceased." I did that. I get a great deal of joy of doing good things.

David Segal (00:45:52):
Amazing, for a kid whose greatest indulgence was going to a movie in 1952, right?

Leon Cooperman (00:45:57):
Yeah. 20 years ago, I couldn't spell [00:46:00] the word philanthropist probably.

David Segal (00:46:01):
Right. Right.

Leon Cooperman (00:46:02):
They call me philanthropist.

David Segal (00:46:03):
Let's just go back to those. It's a major transformation. You grew up the son of a plumber, hardworking. At an early age, you think you're going to be a dentist. What changed for you? When did you sort of say, "Hey, I'm going to become a Wall Street financier?"

Leon Cooperman (00:46:19):
I never looked at it this way. I just did my job and I was in a good industry. I could have gone to work for steel industry or the tri-rubber industry and not do as well, [00:46:30] but I was lucky.

David Segal (00:46:31):
Well, you went to Xerox at first too.

Leon Cooperman (00:46:33):
Well, Xerox was an interesting example.

Harley Finkelstein (00:46:35):
Yeah. Why did you go to Xerox? That didn't make sense to us.

Leon Cooperman (00:46:37):
Well, it's a very funny story. I was interviewing out of Hunter College and I was lucky enough to get a call back and invited to go to Webster, New York, which was outside of Rochester, to interview. The interviewer was taking me through the quality control laboratories. At that time, the big machine was a Xerox 914. It [00:47:00] was on a platform and they had maybe 20 machines in a room running 24 hours a day. The interviewer said, "We're doing a study to determine what effect the particle size of the toner," which is a carbon black that gets fused to the paper.

(00:47:13):
It has on the consumption how many copies we're getting per pound of toner. I say, "I'm assuming you're finding it to find the particle size, the more copies you're getting per pound." The guy says, "That's exactly what." He said, "Why do you say that?" I say, "Because the finer the particle is, you have more surface area of the particle, [00:47:30] so it'll cover more space." I got the best job offer out of-

Harley Finkelstein (00:47:35):
Out of Hunter.

Leon Cooperman (00:47:37):
Out of Hunter. I got a $7,500 starting offer.

Harley Finkelstein (00:47:40):
$7,500 a year.

Leon Cooperman (00:47:45):
That was 1964.

David Segal (00:47:46):
Were you making more than your dad at that point?

Leon Cooperman (00:47:48):
Oh, yeah. Yeah.

David Segal (00:47:50):
Wow.

Leon Cooperman (00:47:50):
Not more. My dad probably made $25,000 a year.

Harley Finkelstein (00:47:55):
But this was a good job. $7,500 out of college.

Leon Cooperman (00:47:57):
Yeah, out of college. First job out of college. [00:48:00] But they misrepresented a job to me, because two weeks after I joined, they explained they were going to a 25-hour work week. Every week, we expect to work a different shift. One week, I'd work eight in the morning to four in the afternoon. Next week, I'd work four in the afternoon to midnight. Then, I'd work midnight to eight in the morning. I was enrolled in the University of Rochester Graduate School of Business.

(00:48:21):
The weeks that I was on the four in the afternoon to midnight shift, I had to find somebody to shift off with. So I'd have to work 16 hours, go to school, [00:48:30] very tiresome. My wife said, "Look, if you want to go back to school full time, I'll go to work." She was a learning disability teacher. She went to work and I went back to school and I got into Columbia Business School and Columbia opened the door to Goldman, which is why I've given them, over the years, about 50 million. I gave Hunter about the same 50 million.

Harley Finkelstein (00:48:53):
Wow.

David Segal (00:48:54):
You had a lot at stake. You had given up your income, you had, I believe, a young child.

Harley Finkelstein (00:48:59):
6-month-old.

David Segal (00:48:59):
6-month-old [00:49:00] and here you are coming out. At what point were you like, "I'm going to go into finance," and what made you decide? You went from being, "I think I'll be a dentist. I'm going to go work at Xerox," to, "I'm going to go into Wall Street."

Leon Cooperman (00:49:13):
Well, I always liked the stock market. My first stock I bought was Chuck Fuller Nuts in Stanhope, New Jersey. Then I had a professor at Columbia that helped hold my interest, Professor Roger Murray in security analysis. I did well. I like [00:49:30] finding something that nobody else sees, making a bet and having the market prove me right or wrong. Better to be proven right than wrong. I luckily picked a good industry.

Harley Finkelstein (00:49:44):
You've mentioned Toby, your wife, a number of times. How long have you and Toby been married? Must be 60 years?

Leon Cooperman (00:49:49):
It'll be, in August, it'll be 60 years.

Harley Finkelstein (00:49:54):
60 years. You've also talked about, 60, unbelievable. David and, I'm married for 10, you're married for 15, something like that.

David Segal (00:49:57):
Yeah.

Leon Cooperman (00:49:57):
Those are human years, not dog years.

Harley Finkelstein (00:49:59):
Yeah, I know [00:50:00] six years is a long time. But Toby also seems to be major part of the Lee story, and it feels like there's a real partnership there. Can you talk a bit about the people that watch this show, that watch this project, some of them are young and they're sort of in the early stages of marriage, but how do you create that type of partnership with Toby? How did you do that, so that you guys had such strong-

Leon Cooperman (00:50:21):
Well, you have to show respect for her, which she deserves. You have to have an intuition. [00:50:30] I knew when, we dated on weekends, and Monday to Friday was all business, and she accepted that. But you have to have a sixth sense of when you're spending too much business and not enough time at home. I think to be successful, you have to have a balanced life.

Harley Finkelstein (00:50:48):
Do you think you have balance in your life?

Leon Cooperman (00:50:51):
Well, I'm probably a little bit more extreme to one side, but I have two terrific kids. They come home. I consider my great [00:51:00] success in life is my children still come home. I'm very close to my grandchildren, which an old friend of mine who passed away recently used to say, "If he knew how enjoyable his grandkids were, he never would have bothered children." It's a good trick.

Harley Finkelstein (00:51:14):
It's a good trick.

Leon Cooperman (00:51:15):
But I have three grandkids, two of the older ones, I'm particularly close with. The younger one lives in Manchester, Vermont, so I don't see as much of him, but he's being shaped. The oldest one, [00:51:30] like her father graduated from Stanford, Phi Beta, got a fellowship to George Washington University. Very, very liberal, but very smart in her liberalness.

Harley Finkelstein (00:51:37):
Liberal, but smart.

Leon Cooperman (00:51:38):
Yeah, very smart.

David Segal (00:51:40):
Lee, when did you know you made it? You've had this incredible career. Was there a moment where you're like, "I made it."

Leon Cooperman (00:51:46):
I don't think about things that way. I really don't think about things that way. I just did my job. I did it well and I got promoted. Every year I was at Goldman, they exceeded my expectations except one. One year, I thought I would've [00:52:00] earned more than I earned, but-

David Segal (00:52:01):
How'd that make you feel?

Leon Cooperman (00:52:03):
I was disappointed, but I told him that and we spoke about it, but I was patient. I could have left Goldman over the years and gone to another place, but I had the patience to stick with what I had.

David Segal (00:52:18):
What gave you that patience?

Leon Cooperman (00:52:21):
Just a long vision. I only interviewed for one job very seriously. It's a guy named, an institutional capital in Chicago. [00:52:30] He approached me. He was big in using Harvard psychologist. I went up to Harvard for test. I got a very high mark and he made me a job offer.

(00:52:41):
It was a very attractive job offer. I said, "I've been working at Goldman now for eight years. I'm on the verge of a partnership. I can't leave until I see the decision. Maybe it's the wrong decision, but I'm not going to come." I was made a partner and then-

Harley Finkelstein (00:52:56):
It didn't matter anymore?

Leon Cooperman (00:52:57):
It didn't matter anymore.

Harley Finkelstein (00:53:00):
[00:53:00] We've heard in our research, two people in particular that you seem to really subscribe to, which is William Hurd and Teddy Roosevelt. Some of their teaching and some of the things that they've said have really affected you, and obviously, both William Hurd and also Teddy Roosevelt, they talk about integrity, they talk about hard work and stuff. But what in particular from those two people do you find to be most valuable as a life lesson?

Leon Cooperman (00:53:26):
I would say the life lesson, not from them [00:53:30] particularly, but overall, is that the harder you work, the luckier you're going to get. You have to have goals in life and you have to work towards those goals and you have to have great integrity and deal with your investors. I would tell my investors what my goals were and I would say very flat out at the beginning, "If these goals don't represent your goals, don't invest in me, because we have a failed relationship. If my goals meet your goals, invest in me. You won't find a harder worker than me."

Harley Finkelstein (00:53:56):
Yeah. On that, on the investor side, obviously leaving [00:54:00] Goldman, starting Omega, now you have to go and raise money from limited partners, LPs. What was your pitch to them?

Leon Cooperman (00:54:09):
Well, I basically showed them my historical accumulation of wealth, my historical performance. I had an audited record by Coopers & Lybrand. I believe it was Coopers & Lybrand.

Harley Finkelstein (00:54:21):
It became KPMG or one of the others or something.

Leon Cooperman (00:54:22):
And...

Harley Finkelstein (00:54:27):
You Let the numbers speak for themselves.

Leon Cooperman (00:54:28):
Yeah, exactly.

David Segal (00:54:30):
[00:54:30] Lee, what does Toby think that you change your own light bulbs? I can't believe he changes his own light bulbs.

Harley Finkelstein (00:54:36):
I don't change my own light bulbs.

David Segal (00:54:37):
It's one thing to be frugal and drive a Hyundai, although a souped up Hyundai, but you change your own light bulbs?

Leon Cooperman (00:54:44):
Like I said, I've not learned how to live rich and I don't like wasting money. Right now, it's a big debate. I've developed a real serious case of arthritis, and when I go up at a ladder to change the light bulb, my wife gets very upset.

Harley Finkelstein (00:54:57):
Yeah, I can imagine that.

David Segal (00:54:57):
Sure, but you still do it?

Leon Cooperman (00:54:59):
I still do it, yeah. [00:55:00] That story comes out of a Home Depot visit. I went to Home Depot to buy some lumber and light bulbs. I bumped into Larry Armour who was a writer for Barron's at the time, and he used to give me some space in his trader column and he said, "What are you doing at Home Depot?"

(00:55:16):
"I'm buying light bulbs. They charge $35 in the building to send up the custodian to change a light bulb. It's a waste of money. I'd rather do it myself."

David Segal (00:55:26):
Did you write an article about it?

Leon Cooperman (00:55:28):
Yeah. That's where you got the story from.

David Segal (00:55:30):
[00:55:30] Yeah. I'm sure that is.

Harley Finkelstein (00:55:32):
Your kids. They grew up as the sons of Lee Cooperman. That creates incredible opportunity, but also creates a bit of a shadow and overhang. It's clear though, as you talk about your kids and you exemplify this pride you have in them, that they've done amazingly well in independently of you.

Leon Cooperman (00:55:54):
Well, when they were growing up, I didn't have a lot of money. My older boy now is [00:56:00] 56. His brother is 53.

David Segal (00:56:03):
A kid, a kid.

Leon Cooperman (00:56:04):
Yeah. I didn't have a lot of money, and then when I started accumulating money, now they read all this about billionaires. I don't live like a billionaire.

Harley Finkelstein (00:56:13):
Yeah, we know.

Leon Cooperman (00:56:14):
In fact, Anthony Scaramucci said I was the worst-dressed billionaire he ever met, and my response to him was multi.

Harley Finkelstein (00:56:24):
You give it to that. That's perfect. That's perfect.

Leon Cooperman (00:56:26):
Yeah, but I don't care about money. Maybe I don't care about money, [00:56:30] because I have what I need.

Harley Finkelstein (00:56:31):
Yeah.

David Segal (00:56:31):
Well, I would challenge that. You do care about it in the sense that you have a heart of gold and you give it all away.

Leon Cooperman (00:56:38):
Yeah, but I'm giving it to people that don't have it.

David Segal (00:56:40):
Right.

Leon Cooperman (00:56:42):
If I cherished money, I would give less of it away and keep more of it. I'd start buying art and start buying sports teams and stuff like that, which probably are great investments. People have made a lot of money doing that.

Harley Finkelstein (00:56:54):
Yeah, most people do it. One of our previous guests was David Rubenstein, who recently bought-

Leon Cooperman (00:56:58):
He just bought the Baltimore Orioles.

Harley Finkelstein (00:57:00):
[00:57:00] He just bought the Orioles. For him, he grew up as the son of a-

Leon Cooperman (00:57:05):
Postman.

Harley Finkelstein (00:57:05):
... postman in Baltimore, and so for him to go and buy the baseball team there was very meaningful to him. It was less about the return on investment, more about the symbolism of, "I've worked really hard for this."

Leon Cooperman (00:57:16):
He's a terrific guy, and I do what you're doing now at the New Jersey Performing Arts Center, I do a Distinguished Speaker series and I interviewed him. He did the best job of anybody that came.

Harley Finkelstein (00:57:27):
He's so smart.

Leon Cooperman (00:57:28):
He said, he basically said [00:57:30] his name was Rockefeller, but he changed it to Rubenstein, which I thought was a great line.

Harley Finkelstein (00:57:32):
I like that too.

David Segal (00:57:33):
In your book, Lee, you talk about growing up and how there were few indulgences, you guys didn't have any money. You went to a movie called Million Dollar Mermaid.

Leon Cooperman (00:57:42):
Mermaid, with my dad. Yeah.

David Segal (00:57:43):
Did You ever think today you could, not only could you go to a movie, you could basically buy every movie theater in the world if you wanted. Does that ever settle in for you?

Leon Cooperman (00:57:50):
I don't have those interests. Now, maybe because I have an average IQ, I've spent most of my time on my business. I just didn't have the luxury of extra [00:58:00] time, so I worked very hard on my business and I have currently 40 positions, so I talk to 40 companies every quarter. I speak to them in between quarters. It's very demanding business.

Harley Finkelstein (00:58:10):
Why 40?

Leon Cooperman (00:58:12):
Just turns out that way.

Harley Finkelstein (00:58:13):
That's what it is. Yeah. They're all in one particular vertical or they're across the entire spectrum of industry?

Leon Cooperman (00:58:17):
Higher spectrum. I own Google and Microsoft was having a very good day today.

Harley Finkelstein (00:58:20):
Very good day. They both reported earnings last night.

Leon Cooperman (00:58:23):
Mr. Cooper is the mortgage company. I own Apollo and private equity, diversified. I'm not as [00:58:30] diversified as I was previously, because when I was in business, I had 40, I had like 10 billion at the peak, had 40 people working with me. I had 10 analysts. I only now have two analysts. I like to own what I know.

Harley Finkelstein (00:58:43):
Yeah. The current, the family office right now, the Omega family office, it's you and two analysts?

Leon Cooperman (00:58:50):
Two analysts, a total of about nine people, including me.

David Segal (00:58:54):
When you were a kid, Lee, is this what you envisioned in your future?

Leon Cooperman (00:58:57):
I didn't have any long-range plan. I [00:59:00] just came to work. I put my foot, one foot in front of the other, had the [Yiddish 00:59:04], common sense. I no.

David Segal (00:59:07):
No plan.

Leon Cooperman (00:59:09):
No plan, no plan.

David Segal (00:59:11):
Wow. Which is counter-intuitive.

Leon Cooperman (00:59:13):
Well, you go with the flow. I was lucky how Goldman prospered.

Harley Finkelstein (00:59:20):
You've talked a lot about luck and hard work and stuff, and one thing that David and I are fascinated by and part of the sort of platform of this project, this Big Shot project, is the concept [00:59:30] of [Yiddish 00:59:31]. I'm curious, what does [Yiddish 00:59:32] mean to you?

Leon Cooperman (00:59:34):
Courage. I say not arrogance. I tell people, I tell youngsters that the least attractive attribute is arrogance. No matter how successful you are, treat people below you the way you treat people above you and they're very important. [01:00:00] Have a good instinct. I can tell you a story.

(01:00:03):
I won't mention all the names, but myself, a Goldman Sachs salesman who's now deceased, Ken Langone, the three of us took out a money manager. The purpose of the dinner was for Langone to put a client with this guy, and when he saw how the money manager treated the waiter, he never brought the subject up.

Harley Finkelstein (01:00:22):
Wow. What did he do to the waiter? Just disrespectful.

Leon Cooperman (01:00:25):
Disrespectful, yeah. Just talked to him in a nasty way. He didn't-

Harley Finkelstein (01:00:29):
And that would've been a big deal.

Leon Cooperman (01:00:30):
[01:00:30] Yeah, I would think so, and that's why I love Ken Langone and I admire him so greatly. He's just very successful and he knows how to treat people.

David Segal (01:00:43):
Right, treat them well.

Harley Finkelstein (01:00:44):
There's also this sort of theme I think that comes up around sort of going back to the 15 million Jews in the world and disproportionate success. Is there something that you want to instill in sort of the next generation, next vintage?

Leon Cooperman (01:00:59):
Yeah, I [01:01:00] would. I don't consider myself like a big platform, but I read that 30 or 40% of the young kids today think socialism is preferred to capitalism. I don't think they have a clue, and I wrote the book, because of my three grandkids. I wanted them to understand that capitalism is what made me successful, and-

Harley Finkelstein (01:01:19):
It feels like capitalism is the great equalizer, right? It means that-

David Segal (01:01:23):
[inaudible 01:01:22], yeah.

Harley Finkelstein (01:01:23):
... the Western world's successful. It means that if you are smart and you work hard that you can actually-

Leon Cooperman (01:01:27):
Yeah, but all these demonstrators now think [01:01:30] socialism is preferred to capitalism. I wanted to educate my grandkids to explain how capitalism worked for us.

Harley Finkelstein (01:01:37):
But this is not the first time we've seen this, right? It's sort of like this cycle. That every couple of decades we sort of get into this-

Leon Cooperman (01:01:41):
It probably results from income disparity to a degree. I feel very strong in this point, which is it is not an easy solution, but we have to agree as a nation, what should the maximum tax rate be on wealthy people, because that will define the revenue [01:02:00] yield to the government. The government has to size themselves that revenue yield. Now, if you talk to Bernie Sanders, who's a communist, he's not a socialist. He would say 90% of your income should go taxation. Liz Warren was 70%, plus a 2% wealth tax.

(01:02:12):
Equally stupid. Wealth tax has not worked wherever it's been instituted. Third guy I spoke to is Paul Krugman of New York Times, he's at 64%. The guy that I like the most is this Black conservative economist, Thomas Sowell, who has a line. He says, "In this world of conservatism, what is your [01:02:30] fair share of what someone else has worked for?" Where I've said publicly, "I'm prepared to work six months for the government, six months for myself, which is a marginal tax rate of 50%."

David Segal (01:02:38):
Which is higher than most people in your position. Well, capital gains is not 50-50.

Harley Finkelstein (01:02:40):
No.

Leon Cooperman (01:02:44):
The reality is if you live in Connecticut, New Jersey, New York, California, you're all in tax rate, state, local, and federal is well over 50%.

Harley Finkelstein (01:02:53):
It's Canada too.

Leon Cooperman (01:02:55):
We're still running a deficit of a very large, so it gets to be counterproductive if you start to [01:03:00] take too much money away from the individuals. We have a spending problem. Just recently, about three months ago, Manchin was on TV with Mitt Romney talking about the need to deal with the Social Security problem, and they referenced the Simpson-Bowles Commission, which had intelligent recommendations. Nothing was done. The problem now is three times greater than it was 10 years ago when Simpson-Bowles, or nine years ago, when Simpson-Bowles made their recommendations.

(01:03:26):
We have a system of government of leadership at a crisis. [01:03:30] We're living too comfortably with the policies we have now, and nobody knows when the shit hits the fan. Maybe it doesn't. I think it will, but you don't know. I'll give you an example. In 1972, to two very civic minded citizens, Pete Peterson and Henry Fowler, who was a Goldman Sachs partner, used to run full-page ads in the Journal and the Times alerting the public to the evils of the budget deficit. Here we-

David Segal (01:03:59):
They [01:04:00] paid for those ads themselves.

Harley Finkelstein (01:04:01):
Right before hyperinflation and all the issues had-

Leon Cooperman (01:04:04):
Yeah.

Harley Finkelstein (01:04:04):
Yeah.

Leon Cooperman (01:04:05):
Here we are. That was 1972, so we were 52 years later. What's the relevance of the deficit? We have the lowest interest rates in the history of the world. It's not proven to be an issue. Now, one day it will and the government will. In 2008, we invented every acronym under the sun, because we were going down the tubes, so there was cooperation.

(01:04:24):
There'll be cooperation once again, when we get into trouble. I think either deficits [01:04:30] matter or they don't matter. If they matter, we'll have a problem, whether it's a year from now, two years from now, I don't know when.

David Segal (01:04:36):
Lee, you obviously are very passionate about politics. There's a rumor you almost ran for president at one point. You write, you're on TV. Why? You don't have to do that.

Leon Cooperman (01:04:47):
Well, I think as Aristotle or Socrates said, "The last virtue of society is indifference, tolerance and indifference," so I think all of us have to speak their mind. I was more limited at Goldman, because I worked for a large institution. [01:05:00] Now, I work for myself. I remember having dinner in the White House with the past President, you know?

David Segal (01:05:08):
Obama?

Leon Cooperman (01:05:08):
Donald Trump.

David Segal (01:05:09):
Oh, Trump.

Leon Cooperman (01:05:09):
Donald Trump. He said to me, "Do you think your open letter to President Obama created your SEC problem?" I said, "Mr. President, a lot of people say that. I honestly don't know the answer. All I can tell is there are a bunch of bad guys not looking for the truth. They ruined my business, but I congratulate you on your victory. In my opinion, if Hillary Clinton had won, [01:05:30] we'd be in a recession today. You represent extra innings of both the economy and the stock market. Most important thing you could do is work hard to unify the country. Too much divisiveness."

(01:05:38):
His response was, "Hey, impossible, too much anger, not focusing on the source of the anger." Then he goes on to say two things, which put him in the hall of shame for me. I would never vote for him. The first thing he said was, this was years ago. The first thing he said is, "I [01:06:00] just got back from Saudi Arabia. They love me. Not that they love America, they love me. They put six foot full fields of marble on the ground covered with red carpet. They spent a half a billion dollars on my visit. They love me." The second thing he said-

Harley Finkelstein (01:06:15):
Sounds like arrogance, by the way.

Leon Cooperman (01:06:16):
Yeah, arrogance. The second thing he said was, it will come back to me a little bit. I'm having a senior moment now.

David Segal (01:06:24):
But basically, he demonstrated his true character to you?

Leon Cooperman (01:06:27):
Yeah, basically, [01:06:30] it's terrible. I wouldn't vote for him for non-economic, his economic ideas are superior to Biden's. Okay, but he mocked the New York Times reporter, had cerebral palsy. You learn when you're two years old, you don't make fun of handicapped people. Then he basically dissed Mitt Romney, who was a true war hero. Then he dissed Nikki Haley's husband, serving in the Middle East now. That's just not the behavior of a president.

Harley Finkelstein (01:06:56):
Yeah. There's a certain-

David Segal (01:06:57):
Principles above economy.

Harley Finkelstein (01:06:58):
There's a certain gravitas that really matters. [01:07:00] I want to ask you about your dad. One of the things that we read, your book that we thought obviously was fascinating is that your dad played a huge role in your life. Obviously, he helped shape your discipline, your work ethic. Your dad also had an unfortunate untimely death. I think he was doing some [inaudible 01:07:16]-

Leon Cooperman (01:07:15):
Well, my father was-

Harley Finkelstein (01:07:16):
He was doing some manual labor for a friend or something like that.

Leon Cooperman (01:07:18):
Yeah, right.

Harley Finkelstein (01:07:21):
Even though he quit his job. Well, he quit his job from what I understand-

Leon Cooperman (01:07:22):
He retired to cardiac disability.

Harley Finkelstein (01:07:24):
That's right, because he had a heart condition. So he retires because of the cardiac issue, but then he goes and helps his friend move equipment.

David Segal (01:07:30):
[01:07:30] He couldn't resist.

Leon Cooperman (01:07:31):
He carried a sink up a four-story tenement in Florida, had a heart attack and died.

Harley Finkelstein (01:07:35):
What happened?

Leon Cooperman (01:07:37):
Well, he was disposed towards helping people.

Harley Finkelstein (01:07:39):
Even if he knew he wouldn't be able to or shouldn't be?

Leon Cooperman (01:07:44):
He didn't think about it, I guess. He didn't think about it, but he carried a sink up a four-story tenement in Florida, had a heart attack and died.

Harley Finkelstein (01:07:53):
Wow.

Leon Cooperman (01:07:53):
But-

David Segal (01:07:54):
Did you know him well growing up? He was working six days a week and on call to 7th.

Leon Cooperman (01:07:58):
No, you never know him. I tell my kids, [01:08:00] spend more time with me, because when I'm gone, you'll be regretful.

Harley Finkelstein (01:08:04):
Do you regret not spending more time with your dad?

Leon Cooperman (01:08:07):
Sure.

Harley Finkelstein (01:08:07):
Yeah. But he did what he had to do put food on the table.

Leon Cooperman (01:08:10):
Yeah. I used to type his billings every month, supply, enforce and install Flushometer, five bucks, 10 bucks, supply and install this, cleaning out stoppages. He worked very, very hard. He worked very, very hard.

Harley Finkelstein (01:08:27):
What do you think your father would think of the man [01:08:30] you've become?

Leon Cooperman (01:08:31):
I think he'd be proud, justifiably, but I don't think about things like that. I don't give myself any accolades. I just put one foot in front of the other. I do what I think I should do. In 19, I guess eight or nine years ago, I had dinner with Warren Buffett on the Giving Pledge. I knew what I was going to do before I had dinner with him. You don't go to a meeting like that, not knowing what you're going to do, but I told him was, "The Giving Pledge is very meritorious. If you're talking to wealthy people, asking for half is not asking for enough, [01:09:00] nor is the request original."

(01:09:01):
In 1900, Andrew Carnegie said, "Who dies rich dies disgraced." In 1930, Sir Winston Churchill said, "You make a living by what you get. You make a life for what you give." 1961, when President Kennedy was inaugurated into the presidency, he said, "Ask not what your country can do for you, ask what you could do for your country." I told Warren, I said, "I'm Jewish, and they say in the Talmud, you measure man by not what he had, but what he gives."

(01:09:25):
I said, "The difference between you and I, I'm not going to give my money to Bill and Melinda Gates to give away," which is what [01:09:30] Warren did. "I'm going to give away my money to those institutions and organizations that made a difference to me and my family in my lifetime," which explains my giving to St. Barnabas, a local hospital. They serve a million people in the local community. Cooperman College Scholars, I have my wife and I have a big interest in education, shared by my grandchildren.

Harley Finkelstein (01:09:49):
Even Columbia. Columbia helped you.

Leon Cooperman (01:09:51):
Columbia helped me, so I gave them 50 and I gave the similar 50 to Hunter College, now called-

David Segal (01:09:57):
Which I believe was the largest donation Hunter College [01:10:00] has ever received.

Leon Cooperman (01:10:01):
At the time. Yeah, I think 50 [inaudible 01:10:02]-

Harley Finkelstein (01:10:02):
$50 million is an unbelievable amount of money.

Leon Cooperman (01:10:05):
Yeah. Well, I've made an unbelievable amount of money and I'm trying to do constructive things with it. But compared to other people, I'm small-time now.

Harley Finkelstein (01:10:15):
If Lee Cooperman is small-time, then I don't even know what to say.

Leon Cooperman (01:10:19):
Well, I'm talking about my financial.

David Segal (01:10:20):
For sure.

Harley Finkelstein (01:10:21):
We know what you're talking about.

David Segal (01:10:21):
We know what you're talking about.

Harley Finkelstein (01:10:24):
One of the things that I think is remarkably about your story is your modesty, of course, [01:10:30] is amazing. Your integrity is amazing, but I think you are so thoughtful about every stage of your life. You called your fund Omega, because you knew that that would be the last sort of career move for you before you would retire. For someone who says they didn't really have a plan, they put sort of one step in front of the other and just kind of kept working, your plan has worked out.

Leon Cooperman (01:10:53):
Yeah, but I've been very lucky. When I joined Goldman, they earned five million. I was made a partner, they earned 40 million. When I retired, they earned 1.8 billion.

Harley Finkelstein (01:11:00):
[01:11:00] Right, but you picked Goldman.

Leon Cooperman (01:11:03):
That was it. I picked Goldman. Yeah, I had good intuition. As I said before, I attribute my suggest a hard work and luck, which don't require a lot of explanation, but intuition. I went to Goldman even though they weren't the best job offer, turned out to be the right decision. I left dental school to go to-

David Segal (01:11:18):
Lee, what do you do when that intuition fails? When you woke up the next morning, when you lost in 2008 or you lost 125 million with Clayton, what do you tell yourself?

Leon Cooperman (01:11:27):
Throughout everybody's career, you have setbacks. What makes [01:11:30] for success is how you handle the setback, and I just worked a little bit harder. I took the calls from the lawyers, while trying to run the money.

Harley Finkelstein (01:11:38):
Yeah. Crazy. I spoke to someone who during-

Leon Cooperman (01:11:44):
I could have walked, not to interrupt you, but I could have walked away when I was down, but I didn't walk away. The hedge fund compensation structure has what they call a high watermark feature. If you get paid and the next year you go down, you got to make back the loss before you get paid again.

(01:12:00):
[01:12:00] I could have gone out when I was down nine, 2008, I had a terrible year, a terrible year. I got caught by Lehman. I didn't foresee it. I could have gone out and returned the money, but instead I worked just for the manager fee, no incentive fee, until I got back to high water.

David Segal (01:12:14):
Why do you think you missed it?

Harley Finkelstein (01:12:16):
2008?

Leon Cooperman (01:12:21):
I operate with an optimistic bias, I guess. I'm not optimistic anymore. I think the direction of the country is not good. [01:12:30] What made America great was their commitment to exceptionalism. I just read the other day that in the state of Washington, because the minorities don't do well in the bar, you no longer have to pass the bar to be a practicing attorney in Washington. We're dumbing down the system.

Harley Finkelstein (01:12:45):
Yeah, we're far away from American exceptionalism.

David Segal (01:12:47):
Which is not the Jewish way. Jews are this tiny, they're the minority of minorities, but we're not brought up to think that the bar should change for us.

Leon Cooperman (01:12:57):
No, exactly right.

Harley Finkelstein (01:12:58):
What do you think about the future [01:13:00] of finance? What do you think? We talked about the-

Leon Cooperman (01:13:02):
There's always going to be a role for an intermediary, and the question is whether you could add some value. I don't look for any radical change.

Harley Finkelstein (01:13:11):
Is that ultimately how you think where the industry will go, where your industry will go, where Wall Street will go is that those that can create more value will be successful and those that don't, just won't?

Leon Cooperman (01:13:19):
Yeah, they'll perish. The business is more competitive. Artificial intelligence will change the game for some companies.

Harley Finkelstein (01:13:29):
Do you [01:13:30] believe in that? Do you believe in that, if you're an optimist, then truly you believe that innovation and technology are going to make everything better. Do you see that happening or do you think some of it's just...

Leon Cooperman (01:13:39):
I think it'll hurt some companies and help some companies.

Harley Finkelstein (01:13:42):
How so?

Leon Cooperman (01:13:44):
Well, I don't know enough about that. I'm not an expert in that area, but I would assume where you could routinize a function, like the lawyers charge you a lot of money. If you can get a document off the internet [01:14:00] through artificial intelligence, the legal profession may be hurt. A lot of these education companies could be hurt. On the other hand, there'll be companies benefited.

David Segal (01:14:12):
You talk a lot about your dad and his impact on you. What was your mother like?

Leon Cooperman (01:14:16):
My mother was a typical housekeeper. She made lunch for me when I came home from school. I walked home for lunch from public school. She was not a [01:14:30] dominant figure in my life, but she was a good mother, made me egg salad sandwiches for lunch.

Harley Finkelstein (01:14:38):
Crust cut off? Did she keep the crust?

Leon Cooperman (01:14:42):
I don't remember. No, I would say we kept the crust on.

Harley Finkelstein (01:14:44):
Okay, that's good. Was she encouraging or it was more your dad who was more sort of the catalyst?

Leon Cooperman (01:14:50):
Well, I think they both understood the importance of education, and my dad is the one who would foot the bill. When I went to college, I didn't have any choices. I didn't [01:15:00] apply to 10 colleges. I couldn't afford, so I applied to University of New York and I went to college for $24 a semester, which is now up to $6,000 a semester, which is why I-

Harley Finkelstein (01:15:11):
$24 a semester. It's unbelievable.

Leon Cooperman (01:15:14):
We went on strike one year, because they wanted the charges for our books. We used to get our books for free.

Harley Finkelstein (01:15:17):
Wow.

David Segal (01:15:18):
You protested.

Leon Cooperman (01:15:19):
We protested. We didn't appreciate the significance of getting free books.

David Segal (01:15:23):
Right. Of course.

Harley Finkelstein (01:15:25):
It's back to the sort of dentist thing. One of the jokes that David and I have is I still pay my legal [01:15:30] fees to be an insured lawyer. I'm never going to practice law.

David Segal (01:15:35):
You never know. Something to fall back on.

Harley Finkelstein (01:15:37):
My bubby and zady, my grandparents, my parents, that's what they say, "Pay your dues. Pay your fees still, just in case. Just in case." It's an amazing thing that whether you're 81-year-old multi-billionaire, Lee Cooperman or you're David and Harley, that this idea of something to fall back on is so enshrined in the DNA of Jews, it's remarkable.

Leon Cooperman (01:15:59):
Well, you're always looking over your [01:16:00] shoulders.

Harley Finkelstein (01:16:00):
Right. It's exhausting.

Leon Cooperman (01:16:02):
A guy that I have enormous respect for who worked with me for many years and he's been a very important part of my career, Steve Einhorn.

Harley Finkelstein (01:16:08):
Steve Einhorn?

Leon Cooperman (01:16:08):
Yeah. He's a terrific guy, Jewish, and he's always looking to see things he could do better and that's a Jewish trait. Right?

David Segal (01:16:20):
Omega, you've had plenty of alum from Omega in it's heyday who've gone on to do incredible things.

Harley Finkelstein (01:16:26):
It's almost like the Omega mafia that sort of has sort of-

David Segal (01:16:29):
Right.

Leon Cooperman (01:16:29):
Well, [01:16:30] not as many as Tiger, Julian Robertson had, but yeah, Michael Zimmerman, David Fiszel, Larry Robbins, Brian Zied all went on to try and do their own thing. Natural instinct, people want to move ahead in their life.

David Segal (01:16:45):
Did you stake them, the way that Julian Robertson did with the Tiger [inaudible 01:16:48]-

Leon Cooperman (01:16:48):
I did in a few of their cases. I'm an investor with Michael Zimmerman. I'm an investor with David Fiszel. I was an investor with Larry Robbins. I pulled out over the fact that he doubled his fees, which [01:17:00] I thought was inappropriate, but his performance is good. He's a smart guy, good guy, very generous guy.

David Segal (01:17:07):
What's most satisfying about what you do?

Leon Cooperman (01:17:10):
Helping others. I say of the things I do, helping others brings me the greatest satisfaction, and seeing my grandkids and my children grow old, purposely and in health, very important to me.

Harley Finkelstein (01:17:24):
Yeah, I love that. One thing that we'd be remiss if we didn't ask you, because you've spent more time thinking [01:17:30] about the markets and finance and investing pretty much than anyone else we've ever spoken to in our lives. What do most people get wrong about investing? If you're watching this and you're in your 20s or 30s or 40s, do you have a little bit of-

Leon Cooperman (01:17:42):
They just try to go from one fad to another fad, rather than develop a discipline.

Harley Finkelstein (01:17:47):
What do you think? What should that discipline be about?

Leon Cooperman (01:17:50):
Well, decide what you know. You know what own, own what you know. So basically, I'm not into technology. I gave money on the outside [01:18:00] to technology or into guys that know more than me. I stick in the value sector of the market.

Harley Finkelstein (01:18:04):
Value sector as a source of growth.

Leon Cooperman (01:18:06):
Right.

Harley Finkelstein (01:18:06):
Although you are in-

Leon Cooperman (01:18:07):
It could be growth and value.

Harley Finkelstein (01:18:08):
You're still in Google and Microsoft, so maybe their value-

Leon Cooperman (01:18:11):
They're my windows into the technology world. When I bought them, they were value. Now they're not cheap anymore, but they're in the vogue.

Harley Finkelstein (01:18:20):
What do you think of these companies that are growth at all costs, that are not necessarily, they don't really care about the bottom line, it's just a matter of these valuations.

Leon Cooperman (01:18:30):
[01:18:30] I think they're overvalued, generally speaking, and I don't bother with them.

Harley Finkelstein (01:18:35):
You stay away from that stuff?

Leon Cooperman (01:18:36):
Yeah.

Harley Finkelstein (01:18:36):
You want good fundamentals.

David Segal (01:18:38):
Have you been able to see, you've lived through so many market cycles. Have you been able to see when a market is too high or about to crash or too low and about to pop?

Harley Finkelstein (01:18:48):
[inaudible 01:18:49]-

Leon Cooperman (01:18:50):
On occasion.

David Segal (01:18:51):
Right. You isolate it.

Leon Cooperman (01:18:52):
Yeah.

David Segal (01:18:53):
Yeah, right. We have a friend-

Leon Cooperman (01:18:54):
When Graham and Dodd, Ben Graham, and the Intelligent Investor.

David Segal (01:18:58):
Yeah.

Leon Cooperman (01:18:58):
Hypothesized that a stock trades [01:19:00] within a certain band of intrinsic value. My job is to figure out when they're above intrinsic value and when they're below. When they're above, you sell them. When they're below, you buy them.

Harley Finkelstein (01:19:12):
It seems [inaudible 01:19:13]-

Leon Cooperman (01:19:13):
This is the third bubble period. Some people don't think we're in a bow. I think we're in a bubble. The bubble might be fixed income. I think we're heading, I don't understand why the long bond is 4.1% or 4.2%. I think that it belongs much higher in yield. Prior to the great financial crisis of 2008, the [01:19:30] 10-year bond yield in line with nominal GDP. If nominal GDP is growing five, 6%-

Harley Finkelstein (01:19:36):
That's where it should be.

Leon Cooperman (01:19:36):
... the long bond would be five or 6%, and so the first bubble I lived through was nifty-fifty, 1972, where US Trust and JP Morgan had this view. It wasn't only owned growth companies at any price, so they paid 50, 60 times earnings. Then, we had a tenfold increase in the price of oil in 1973, we got into the '73-4 recession, those stocks collapsed. It took [01:20:00] a decade for them to recover.

(01:20:01):
That was the first bubble. The second bubble was 2000 tech bubble. Cisco, which was the then NVIDIA was selling at 300 times earnings. When we hit the recession of '01, '02, it dropped 90%. People don't realize that Cisco today is still below what it was 24 years ago.

David Segal (01:20:25):
At 90% off?

Leon Cooperman (01:20:28):
Well, no, it's recovered from the 90.

David Segal (01:20:28):
It's recovered from the 90%.

Leon Cooperman (01:20:30):
[01:20:30] It's below its previous high.

David Segal (01:20:32):
Right, it's high. Yeah.

Leon Cooperman (01:20:33):
And the internet has lived up to everything you expected, so I think artificial intelligence will live up to what's expected, but maybe it's being overly discounted in the market. I don't know.

David Segal (01:20:42):
Even Microsoft, I believe, took 16 years to get back to its high in the 2000 bubble.

Leon Cooperman (01:20:48):
He done a great job. Change in management there has been-

Harley Finkelstein (01:20:51):
Yeah, Satya is an incredible, he is not the founder of the company, but he operates with this founder mindset that is remarkable.

David Segal (01:20:58):
What do you look for when you're evaluating a company? [01:21:00] Beyond the numbers-

Leon Cooperman (01:21:01):
I evaluate management twice in a decision. Making once to the numbers, return equity, growth rates, free cash flow, use of that free cash flow is a valuation of management, and then I question them face to face, see how they respond to the questions, give them a chance to lie to me, and it's my job to figure things out.

Harley Finkelstein (01:21:21):
Give them a chance to lie to you.

Leon Cooperman (01:21:22):
Yeah. Well, you got to be very careful. Singleton was in a class by himself. He never promoted his stock. He says, my job [01:21:30] is to make the investment that generates the best rate of return. If I don't like the price of my stock, I can always do something about it and very rational.

Harley Finkelstein (01:21:39):
Yeah, Singleton sounds like one of the greatest entrepreneurs that nobody knows.

Leon Cooperman (01:21:42):
He was. He was. Warren Buffett missed the stock. He told me, I wrote A, I spoke at the Value Investing Conference in 19, I think it was, 96. I spoke to two subjects, the brilliance of Henry Singleton and the fallacy of stock repurchase [01:22:00] the way it was practiced at that time. He wrote me a letter, which I still have.

(01:22:04):
Unfortunately, I don't have my attache case with me, but he said, "Dear Lee, you couldn't have picked two better subjects. Henry Singleton was a manager, he was 100% rational. There are very few people I could say that about. The stock repurchase situation is fascinating to me. You should do it only when and only when your stock is undervalued. 50 years ago, it was being done for the right reasons. More recently, it's being done by companies that want to support their stock or make a statement to Wall Street, not necessarily [01:22:30] buying undervalued stock."

David Segal (01:22:31):
Wait, you just said you actually keep the letter with you in your attache case normally?

Leon Cooperman (01:22:35):
Yeah, I do. Yeah.

David Segal (01:22:37):
Wow. You'll keep it, wherever you go, it's with you. It means that much.

Leon Cooperman (01:22:40):
I didn't bring my, well, Buffett is a deity in our business. Right? If he praises something to do, you want to keep your letter for reinforcement.

Harley Finkelstein (01:22:53):
We have to wrap up now. We have to let you go, because you have other stuff to do. But Dave and I started this project, this Big Shot project, to sit [01:23:00] down with people that we think have shaped industries and changed communities and play a role of role model to young Jewish entrepreneurs, like David and I. Lee, you're at the top of that class, and one of the things I am most impressed by is you've made billions of dollars for yourself and for other people. You've had this incredible career. Son of a-

David Segal (01:23:25):
Plumber, yeah.

Harley Finkelstein (01:23:27):
... plumber. For you to have this incredible-

Leon Cooperman (01:23:29):
A plumber is a brain [01:23:30] surgeon these days, not my father.

Harley Finkelstein (01:23:31):
Right. That's true.

David Segal (01:23:31):
Yeah.

Harley Finkelstein (01:23:32):
But son of a plumber, to be able to do this is remarkable. But you've done so with such humility and such high character, I really appreciate you sitting down with us. We are grateful for your time-

Leon Cooperman (01:23:44):
My pleasure.

Harley Finkelstein (01:23:44):
... incredibly inspired. I hope this was fun for you too.

Leon Cooperman (01:23:47):
Steven Spielberg did the stuff on the Holocaust to remember, and hopefully we'll get the right instincts into our children.

David Segal (01:23:54):
You're a true mensch, Lee, you inspire us all and your contributions to society are second to none.

Leon Cooperman (01:24:00):
[01:24:00] You guys are the Larry King of interviewers. You've been very easy on me, very gracious, and I appreciate it, and it was my pleasure to be here.

David Segal (01:24:07):
Amazing. Appreciate you.

Leon Cooperman (01:24:07):
My pleasure. All the best.

MUSIC (01:24:11):
Started from the bottom, now we're here.

(01:24:11):
Started from the bottom, now the whole team here.

(01:24:13):
Started from the bottom, now we're here.

He Inspired Warren Buffett, Became A Wall Street Legend, And Made Billions | Leon Cooperman

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