Private Credit's Clock is Ticking w/ Glenn Schorr & Ken Worthington | The Real Eisman Playbook Ep 72

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**Steve Eisman** (0:53)
Hey, it's Steve Eisman. Welcome to another episode of The Real Eisman Playbook. This episode is being recorded on Thursday, July 30th. Last night, Microsoft reported great numbers and the stock was up 10% plus.
Meta reported hellacious numbers. They had negative earnings growth, 28% revenue growth, 55% expense growth. Numbers were just bad. Guidance was bad and the stock's down 10%.
Today, Thursday, the market has had a big rally because of the Microsoft results. But on the negative side, a very large hedge fund running 20 billion, run by a former employee of OpenAI, apparently was incredibly levered, lost a ton and was liquidated today. The news is fast and furious and we're going to explore some of that with my two guests, recurring guest Glenn Schorr, who covers the investment banks, asset managers and alternative asset managers, and new guest Ken Worthington, who covers the brokers, he also covers the alternative asset managers, and he covers the brokerage firms that are dedicated to Bitcoin, like Bullish and Coinbase. He also covers Circle. I think we're going to have a great conversation, and afterwards, I'll be back with some lessons learned.
Hi, this is Steve Eisman and welcome to another episode of The Real Eisman Playbook. It's July 30th. There's been a lot of news, which probably we're going to get into. Microsoft reported last night. Meta reported last night. One's up 15%, one's down 10%. The market's soaring. A hedge fund was liquidated. There's a lot going on. And so today, to help me unpack it, is recurring guest Glenn Schorr of Evercore. How are you?

**Glenn Schorr** (2:44)
Great to see you.

**Steve Eisman** (2:45)
And a new guest, Ken Worthington, and just as people who don't know, Ken and I worked together at Oppenheimer in the 90s. Welcome, Ken.

**Ken Worthington** (2:53)
Thank you, Steve. Nice to see you, Glenn.

**Glenn Schorr** (2:55)
Nice to see you, too.

**Steve Eisman** (2:55)
So since you're the newbie, why don't you tell our viewers, first of all, what do you cover?

**Ken Worthington** (3:00)
I'm a research analyst at JP Morgan on the sell side. I cover brokers, asset managers, exchanges and crypto.

**Steve Eisman** (3:08)
When you say crypto, what does that mean?

**Ken Worthington** (3:10)
So crypto being coinbase, bullish, so equities that are focused on the crypto asset class.

**Steve Eisman** (3:18)
Have all your companies reported yet? Or most?

**Ken Worthington** (3:20)
No, no, no. The minority.

**Steve Eisman** (3:22)
Minorities report?

**Ken Worthington** (3:23)
Probably 15%, 20% through.

**Steve Eisman** (3:26)
OK. Glenn, who are you?

**Glenn Schorr** (3:30)
I too am a sell side equity analyst. We all know each other pretty well. So we'll sound familiar today. No doubt. No doubt. I cover some of the same stuff Ken covers and some different stuff, everything that you used to cover. So I cover big banks, big brokers, the traditional asset managers, the trust banks and the alternative asset managers. And to answer the question you asked Ken, what percent, I would say a larger percentage, but we both still have a bunch of asset managers still left to report. So maybe 75 to 80% of my coverage is reported as of now.

**Steve Eisman** (4:01)
So Ken, number one, when you're talking to clients, what are their concerns about the stocks that you cover? As sort of a general overstatement. And have you learned anything this earning season that's important?

**Ken Worthington** (4:14)
Yeah. So I would say the topics de jure for us, a lot in the alternative asset managers.
The topics there are M&A and the outlook for middle market M&A, private credit, what's happening in private credit, and then the outlook for selling alternative asset management product to wealth management clients. Like those are really the three drivers. So a lot of questions around that. With regard to the retail brokers, I think the question really is about the outlook for cash. The retail brokers make a lot of money on the free float of customer cash.