Off-Cycle IB Intern, SIE

@retraderichard Particularly my future lung cancer

Everything in life can be traced back to the mango juul pod

Part of this year’s bonus was paid in company stock. I immediately updated my bio to “partner.” But then I realized I needed to start behaving like a partner. Microsoft office has since been deleted off of my laptop. Sent from my iPhone

When they asked me what my inspiration was, I told them global warming

Why is @retraderichard in my office rn

Phebes got the best of the boys yesterday

@alt_w_v_g $15k retainer should surely be an add back then, no? Pls update the model and re-circulate, thx

Update: Met with a divorce lawyer today Not because I want a divorce I just wanted to understand the downside exposure My therapist called it "alarming" I called it "diligence" Nice office Mahogany desk No tissues Good sign He asked why I was there I said "risk management" He said "most people say their marriage is struggling" I said "mine is fine" He said "does your wife know you're here?" I said no He wrote something down He asked what I do for a living I said "I'm a CFO" He said "ah" Second time a professional has said that to me I'm beginning to think it means something He walked me through the process Asset division Spousal support Custody frameworks I took notes He said "most clients don't bring a legal pad" I brought two One for questions One for action items He said in my state it's equitable distribution I said "define equitable" He defined it I said "that doesn't sound equitable" He said "it never does to the higher earner" I made a note I asked about the dog He said "what about the dog?" I said she's a golden retriever and she is non-negotiable He said "we can discuss pet custody" I said "this isn't a discussion. This is a red line." He made a note Good He asked if I had any concerns about my wife's representation I said "she doesn't have a lawyer" He said "how do you know?" I said "she doesn't even have a financial model for the household" He didn't understand why that mattered It matters He said his retainer is $15,000 I said "for what scope of work?" He said "that's not typically how clients respond" I said "I'm not a typical client" He said "I can see that" I asked if he offers a discount for early termination He said "of the retainer?" I said "of the marriage" He stared at me I was serious Time is money Speed to close matters At the end he asked if I wanted to proceed I said "no" He said "then why did you come?" I said "I needed to know the cost of losing her so I could calculate the value of keeping her" He was quiet for a while He said "that might be the most romantic thing a client has ever said in this office" I said "I've been told that before" I did not elaborate Got home My wife asked where I was I said "a meeting" She said "it's 9pm" I said "high priority item" She asked what the meeting was about I said "asset protection" She said "what asset?" I said "you" She didn't know what to do with that Neither did I $15,000 retainer Did not sign ROI was negative She's worth more than the model suggested Sent from my iPhone

@retraderichard That’s ironic coming from the one who bailed on happy hour earlier due to “a late night ahead”

The lion doesn’t concern himself with closing deals when the weather is nice

VDR = staged. Now time to go drink 14 beers on a patio in the sunshine

@MurrayHillGuy1 Drinking is fucking awesome

@alt_w_v_g There’s no need to worry, PJT and Kirkland & Ellis can always engineer a new capital solution

Ran the US Government through a standard PE due diligence framework and it is genuinely the worst deal I've ever seen But every distressed company has a turnaround plan if management has the spine for it Here's the CIM: Revenue (Tax Receipts): $5.2 trillion Total Expenses: $7.0 trillion EBITDA equivalent (surplus/deficit): ($1.8 trillion) The company is EBITDA-negative We haven't even gotten to the balance sheet yet and this is already a pass But let's keep going Debt Profile: - Total debt outstanding: $38.6 trillion - Blended interest rate: ~3.2% - Annual interest expense: $970 billion (FY2025) - That's the third-largest line item in the budget, behind Social Security and Medicare - Projected to exceed $1 trillion in 2026 - Projected to hit $2.1 trillion by 2036 Leverage: - Debt / Revenue = 7.4x - Debt / GDP = ~100% - Any PE fund that underwrote a 7.4x leverage deal with negative EBITDA would lose their LPs by lunch Debt Service Coverage: - DSCR = Operating Cash Flow / Debt Service - Operating cash flow is negative - DSCR = negative - The company cannot service its own debt from operations - It borrows to pay interest - In credit analysis, this is a going concern flag Cost Structure (the real problem): - Social Security: $1.6 trillion (22.4% of spend) - Medicare: $987 billion (14.1%) - Medicaid: $669 billion (9.6%) - Net Interest: $970 billion (13.9%) - Defense: ~$900 billion (13%) Mandatory spending + interest = $5.07 trillion That's 72% of total spending on autopilot Revenue: $5.2 trillion So after mandatory obligations and interest, there's ~$130 billion left To fund $1.9 trillion in discretionary spending Including the entire military The government is structurally cash-flow negative before Congress votes on a single dollar Growth Trajectory: - Revenue growth: ~6% YoY - Mandatory spending growth: ~7-8% YoY - Interest expense growth: projected fastest-growing category over the next decade - By the end of the decade, interest is projected to rival Medicare as the second-largest line item - By 2036, interest consumes 25 cents of every tax dollar collected Sensitivity: - 50bps rate increase on $38.6T = ~$193 billion additional annual interest - 5% revenue decline (recession) = ~$260 billion hit - Combined = ~$453 billion swing - None of these are unlikely. Both have happened in the last 5 years. Now here's where I put on the operating partner hat Because in PE, we don't just diagnose problems We fix them If this were a portfolio company, here's the turnaround plan: 1. You don't grow your way out of a cost problem Revenue (tax receipts) is at 17.3% of GDP — exactly the 50-year historical average The government doesn't have a revenue problem It collects more than it ever has $5.2 trillion The issue is that spending has decoupled from revenue entirely Spending is 23.1% of GDP vs. a 50-year average of 21.2% Closing that gap to the historical average would save ~$570 billion per year That's not austerity. That's reversion to the mean. 2. Restructure the cost base In PE, when 72% of your cost structure is fixed and growing faster than revenue, you restructure You don't raise prices on your customers and hope the margin problem goes away Every dollar of additional tax revenue that gets absorbed by mandatory spending growth is not a solution It's a delay The private sector learned this decades ago: you cannot tax your way to profitability You operate your way there 3. Let the market work The US Government spends $7 trillion a year and has never once been required to demonstrate ROI on a single dollar No IC. No IRR hurdle. No exit timeline. No accountability. In the private sector, every dollar of capital deployed has to earn its way back plus a return That discipline is why private enterprise creates wealth And why government, by definition, consumes it 4. Stop borrowing to fund operating expenses The US has run a surplus exactly 4 times in the last 50 years The last time was 2001 No PE-backed company in history has survived 24 consecutive years of operating losses Not because the market is cruel Because the market is honest The Conclusion: The US Government doesn't need higher taxes It needs an operating model that any first-year analyst could build: Spend less than you collect The free market enforces this daily Companies that don't are restructured Capital is reallocated to better operators That's not ideology That's math The same math that built the most productive economy in human history Not because a committee planned it But because a market demanded it Plz fix. Thx. Sent from my iPhone

Best restaurants around midtown / surrounding areas to go to on bonus day? Need some new recs

@retraderichard Fr

@IBjunioranalyst What jackass scheduled that one…

MP dinner scheduled on St. Patty’s day…. zero chance I’m making that one, I’ll be 12 Guinness’s deep at the local Irish pub by that time

Low deal flow activities

@retraderichard I eat IRR for breakfast

IRR is a placebo effect

Ah yes let’s all make sure we’re in early this morning for a meeting that could’ve been an email

What if we gave Claude peptides

Telling people they got outbid by 4x is one of the few things that brings me more joy than seeing my pre-tax bonus

@retraderichard @litcapital Don’t hate the player, hate the game

@litcapital Clocked you @IBjunioranalyst

I’m sorry, this is the corniest shit I’ve seen in a long time

@retraderichard I have Ontra file HSR for our clients

Just entirely filled out HSR filings with Gemini. Deal should be dead by Friday morning 👍