Paul Kudrowski

So the dog's notion of causality is completely wrong.

We're like that barking dog in terms of understanding the drivers of economic growth right now.

We think it's because of tariffs.

We think it's because of all of these other factors, and it's not.

So there's this perverse incentive to keep doing the wrong things because, look, they're working, and they only are working because no one's going down deep enough to understand, wait a minute, it's being driven by completely different things.

Oh, it absolutely does.

It has all the pieces.

So I'll pick on just one that you mentioned, and I'll just flip it slightly, which is that the connection, for example, to insurance is very poorly understood.

So what's happened over the last few years, it's not so much that insurance companies are large LPs in these private credit providers, meaning that they're large investors in them.

It's the other way around.

So what's happened is private equity and private credit have purchased insurance companies, and they call it, the term of ours, they call it a captive source of capital.

which is to say the premiums get reinvested in what the private equity firm is doing.

And I can use those assets in turn to invest in data centers or whatever else I choose to do.

But what we have, and this goes back to the time of Bear Stearns and the financial crisis, we have a classic temporal mismatch, a timing mismatch in terms of when the debt comes due and when I have to make my payments and when I provide things, right?

You can see how the data centers are relatively transient

But on the other side, I've got these obligations to my insurance policyholders, which are longer term.

So I have mismatched assets and liabilities, wildly mismatched on a temporal, on a time horizon.

No different than what happened way back during the financial crisis, which did embarrass turns, which was they had...

They had lent long and owed short, right?

And so they ended up blowing up on that basis.