MARIA: WHAT'S YOUR TAKE ON FEES
AND THE EXPENSE SIDE OF THE
BUSINESS?
I MEAN FEES ARE GOING DOWN,
YOU'VE GOT LOTS OF COMPETITION
EVERYWHERE, WHETHER IT'S
EXCHANGE TRADE FUNDS AND THIS
RACE TO THE BOTTOM, VANGUARD
KEEPS LOWERING FEES.
WHAT'S YOUR TAKE ON ALL OF THIS?
>> IT'S A REALLY IMPORTANT
THING.
THAT'S WHAT THE CUSTOMERS NEED
TO BE LOOKING AT.
FEES TAKES AWAY FROM YOUR
ULTIMATE RETURN.
AND FROM THE EARLY DAYS I'VE
ALWAYS BEEN FEE CONSCIOUS.
THAT'S HOW YOU GET YOUR END
RESULT IS TO KEEP YOUR FEES LOW.
I THINK TODAY BECAUSE OF
TECHNOLOGY, FEES ARE NEAR ZERO
IN MANY RESPECTS.
YOU HAVE TO HAVE THE VOLUME, AS
WE DO.
AND FORTUNATELY WE HAVE LOTS OF
VOLUME SO WE CAN AFFORD TO HAVE
VERY LOW FEES.
AND THE IMPORTANT THING IS I
THINK WE'RE ONE OF THE LOWEST
COST PRODUCERS IN THE BUSINESS.
WE'RE SORT OF LIKE THE WALMART
OF INVESTING.
WE KEEP OUR COSTS VERY LOW AND
WE DON'T HAVE A LOT OF
EXPENDITURES AND THEREFORE WE
DELIVER TO OUR CLIENTS A BETTER
VALUE.
THAT'S WHAT WE TRY TO DO EVERY
DAY.
MARIA: THAT'S WHAT YOU'VE BEEN
DOING FOR FIVE DECADES.
I REMEMBER THE EARLIEST STORY OF
YOUR CAREER, YOU FELT BAD THAT
SOMEBODY LOST MONEY AND YOU
WANTED TO GIVE THE MONEY BACK.
>> THAT'S WHY WE HAVE THE
GUARANTEE FOR OUR PEOPLE.
NOT LOST IN THE TECHNOLOGY BUT
LOSS OF TECHNOLOGY OR SOME
INVASION BY SOME FOREIGN PERSON,
WE PROVIDE A GUARANTEE FOR THAT
ALSO.
MARIA: YOU MAKE THEM WHOLE.
>> WE MAKE THEM WHOLE.
MARIA: THAT'S INCREDIBLE.
YOU MENTIONED THE POLICIES
COMING OUT OF WASHINGTON WHICH
ARE REALLY CRITICAL IN TERMS OF
THE BACKDROP.
PEOPLE ARE EXPECTING S&P
EARNINGS TO BE UP 18% IN 2018.
>> WELL THAT'S JUST A RESULT OF
THE TAX BILL.
SO POWERFUL WHAT THIS TAX BILL
IS DOING FOR OUR COUNTRY'S
BUSINESSES.
IT'S REALLY A VERY POSITIVE
THING.
AND SO THAT 18% IS PRETTY
REALISTIC.
MARIA: AND IT'S NOT AN OVERNIGHT
SUCCESS.
THIS IS GOING TO HAVE A LONG
RUNWAY.
>> ABSOLUTELY.
MARIA: WHY DO YOU THINK PEOPLE
ARE LOOKING AT THIS AS FAR AS
LONG TERM.
YOU DON'T THINK SOME PEOPLE HAVE
BEEN IMPACTED BY THE TAX PLAN
AND WE'LL SEE THE IMPACT OVER
THE MONTHS .
>> COMPANIES TAKE TIME TO PLAN
OUT THEIR LARGE INVESTMENTS,
WHETHER YOU'RE GOING TO PUT MANY
A NEW PLANT IN OVER HERE, OR IN
OUR CASE IT MIGHT BE A NEW CALL
CENTER OR NEW BRANCH SOME PLACE.
THERE'S PLENTY THAT TAKES PLACE.
IT DOESN'T HAPPEN OVERNIGHT.
SO THE LONG TERM COMMITMENTS ARE
OCCURRING NOW, PLANS MAY BE HAVE
BEEN IN PLACE FOR A FEW MONTHS
AND WE'RE EXECUTING ON THEM NOW.
SO THE FRUITION OF THAT
PARTICULAR NEW ENTITY WILL
REALLY SHOW UP SIX MONTHS, 12
MONTHS LATER.
SO IT'S -- WHAT WE'RE SEEING
RIGHT NOW IS THE SEEDS ARE GOING
IN THE GROUND AND WE'RE GOING TO
SEE THE FLOWERING OVER THE NEXT
SEVERAL YEARS.
MARIA: AND I THINK THAT PEOPLE
ARE RECOGNIZING THAT IT WAS THE
RIGHT MOVE TO ACTUALLY LOWER
TAXES ON THE CORPORATE LEVEL
BECAUSE THAT CREATES AN
ENVIRONMENT FOR COMPANIES TO
HIRE MORE WORKERS.
>> IT
>> WT
>> WHAT IT DOES, MARIA, IS A
MASSIVE SHIFT OF MONEY FROM
GOVERNMENT TO PRIVATE
ENTERPRISE.
AND THAT SHIFT -- WE KNOW THE
POWER OF PRIVATE ENTERPRISE.
WHAT THEY'RE ABLE TO DO.
THE COMPOUNDING THEY'RE ABLE TO
DO, THE GROWTH, THE SPIN IN
TERMS OF ACTIVITY AND
ENTREPRENEURSHIP.
IT DOESN'T HAPPEN IN GOVERNMENT.
SO BY TAKING SOME MONEY FROM
GOVERNMENT, LOWERING TAXES,
MOVING IT OVER TO PRIVATE
ENTERPRISE, WE DON'T KNOW HOW
FANTASTIC IT'S GOING TO BE.
I THINK IT'S GOING TO BE VERY
FANTASTIC.
WH INWITH E LOOK BACK FIVE YEARS
AND SAY WHY DIDN'T WE DO THAT
SOONER.
WHAT HAPPENED.
AND SO WE'RE IN GOOD SHAPE RIGHT
NOW.
MARIA: SOME PEOPLE THINK THAT
THE ROLLBACK IN REGULATIONS IS
MORE IMPACTFUL THAN THE TAX CUT
PLAN.
YOU'VE BEEN IN FINANCIAL
SERVICES AND YOU KNOW THE BURDEN
THAT YOU AND YOUR COLLEAGUES IN
THE BUSINESS HAVE FACED.
SIGNIFICANCE OF THE ROLLBACK?
>> WELL, WE ALL WANT COMPANIES
IN FINANCIAL SERVICES OR ANY
BUSINESS FOR THAT MATTER, WE
WANT TO MAKE SURE THAT WE DON'T
DO ANYTHING THAT WOULD HARM
SOMEBODY FOR SURE.
BUT REGULATION CAN GET SOME
OVER, SO DOUBLE, TRIPLE, QUAD
RUPPABLE THAT IT DOESN'T MAKE
ANY SENSE, WASTEFUL, REALLY
WASTEFUL.
SO WE WANT TO HAVE THE PERFECT
MIX OF PROPER REGULATION THAT IS
EFFICIENT BUT NOT EXCESSIVE.
WE'RE TURNING THE CLOCK BACK IN
TIME GETTING BACK TO AN
EFFICIENT REGULATORY.
MARIA: I WAS TALKING TO ONE CEO
RECENTLY, HE SAID HE JUST WENT
TO NEW JERSEY AND THE BAYONNE
BRIDGE THAT HE WANTED TO INVEST
IN TOOK 13 YEARS.
WHY WOULD ANYBODY INVEST IN A
PROJECT IF YOU'RE NOT GETTING A
RETURN FOR 13, 15 YEARS.
>> DOESN'T MAKE ANY SENSE.
AND THAT'S THE BEAUTY OF FREE
ENTERPRISE.