Every once in a while I read something that just keeps coming back to me over and over again. Last week I read a brief piece in Bloomberg Businessweek that did that for me. Bill Gross, co-founder of PIMCO, was talking about his use of fake home buyers to get a feel for the sub-prime market during 2007-2008. He said:
“Timing is everything, though. It wasn’t easy for quite a while: There was a stretch of nine to 12 months pre-Lehman where we were underperforming, and there was a lot of internal questioning and debate. Maybe we should jump in the pool with everyone else. Every investor has an alarm clock. I wish I could get up at 6 every morning and time things just right. I probably get up at 4:30. There’s a cost to that hour and a half, where you sit around the table and acknowledge your competitors are having your lunch. But it is better than getting up too late.”
There are a few metaphors here in this short little quote - a couple too many, really - so I’m going to try and stick with just one: I hear all day about how everyone else is in the pool and my clients are feeling the internal pressure to jump in with them. I am often in the business of looking at a given pool and whether it is safe to jump in to. And I too get up most days before 4:30 and I often need that extra time to really look at what might lie underneath the surface lurking that could cause my clients harm. That is really what a regulatory practice is all about. So that is why, I think this quote has stuck with me. And switching metaphors after all, it does not feel good to think your competitors are having your lunch, but it IS better than getting up too late!