Bob Lefsetz is a music industry observer, and publisher of the Lefsetz letter
I read a story on the airplane…
Not only am I not sure what time it is, I wouldn’t even bet on what DAY it is!
I got off the airplane and my BlackBerry said 3:22 AM. How could that be? My watch said an hour earlier. Took me about twenty minutes to factor in Daylight Savings Time. Fucking BlackBerry can’t figure out what time zone I’m in, but it can adjust for Daylight Savings Time?
Much earlier, as it rained outside, I had lunch on the twelfth floor of the Royal York with Roger Faxon, Chairman and CEO of EMI Music Publishing. They say these guys are clueless? Can’t agree with you when it comes to Mr. Faxon. His views were practical, he had a handle on the landscape and informed me that EMI’s record company and publishing company were two separate entities under the same umbrella, they were already divided, it had been a condition of Terra Firma’s purchase. So when the whip comes down…
Which it inevitably will.
Then I journeyed with Jake to the airport, which was a clusterfuck nonpareil. The “Wall Street Journal” said to arrive two and a half hours in advance, ever since that terrorist incident at the end of last year travel from Canada to the States has been…well, let’s just say they’ve gotten a lot stricter at immigration.
Not that it made any difference. My plane ended up being delayed by two and a half hours.
You see there was weather. Wind shear in T.O., our plane had to stop in Chi-town for more fuel after turning back, afraid of the waiting disaster at Pearson. As for NYC… Something was blowing really hard there too, flights were fucked up all day. Seymour told me he’d considered taking the bus. He had friends in for the Rock & Roll Hall of Fame, he needed to get home.
I couldn’t quite envision it, Seymour Stein journeying like Joe Buck from T.O. to NYC. Only eight hours he said. THE BUS? I remember my parents making me take it from Connecticut back to college in Vermont. This was before every kid in America got a car when he turned 16, so his parents didn’t have to schlep him around. I was scarred for life! Shit, if you want someone to strive for economic greatness, just make them take the bus. It’s a window into a low class world that you’re dying to escape. Shit, did they even HAVE buses anymore? I thought the companies followed the railroads into bankruptcy.
Last I heard, the flight to New York was canceled and rescheduled for 7 AM. Last I saw Seymour, he was heading for the gate. Maybe he should have taken the highway.
And after two hours of insight with Seymour, covering the history of the music industry from Sid Nathan to Lyor Cohen, he was replaced in his seat by Vince. Who I’d seen flying in the front of the plane on the way in.
NO, Getty Images doesn’t pay for business class. Vince is EXECUTIVE PLATINUM! Shit, the CEO of Getty flies in the back of the plane. At least that’s the ticket he buys. At least that’s what Vince said.
And like Bonnie Raitt sang, the luck of the draw got me upgraded to one of the two empty seats in business class. Which was a godsend, having already spent the length of the journey to L.A. at the airport.
And the ride was bumpy. But I read an article in “Vanity Fair”…
Did you read Michael Lewis’ “Liar’s Poker”? He worked at Salomon Brothers and told the story. One I’ve never forgotten. Of blowing up bankers all over the world. Yup, Goldman Sachs had to unload paper, and if someone in a far-flung country, or the keeper of the pension funds lost a bundle, hell, it was just business.
And it freaked Lewis out so much he quit, married Tabitha Soren and started following baseball.
Well, not exactly. He did end up marrying the MTV News queen. His most famous book is “Moneyball”. But he’s still an expert on Wall Street. He’s one of the few writers who can make it comprehensible. Wow, you can read this story online!
You’re never going to read it online. Hell, you’re probably never even going to read it. And that’s just the point. The article is about Michael Burry, who figured out the mortgage market was gonna tank and bet against it. Burry was the leading edge.
But this story isn’t about money. It’s about dedication.
You see Michael Burry was passionate. He was a doctor, training at the hospital, enduring those endless hours, but still he found time to pore over prospectuses, study stocks and pontificate online. To the point when he went pro, some of the most famous traders in America found him, invested in him!
Let me make this clear. This is like making music in your basement and getting a call from Doug Morris or Timbaland or David Foster. But they don’t want to mold you, they don’t want to change you, they don’t want you to do anything different, they just want A PIECE OF YOUR ACTION!
Yup, they found Burry on the Internet.
Isn’t it interesting that warhorses in the music business will pooh-pooh the Net, saying you can’t break an act there, that it comes down to radio and television, but the real money men are trolling for info online?
And how did Burry get so good at picking stocks? BY STUDYING!
Yup, doing the work.
This is Gladwell time.
We live in a country where no one wants to do the work.
Oh, I know that’s an overstatement. But most people want to watch television. They want to focus on their image. Is it any wonder they’re left behind?
Not that you need a formal education to make it. You can’t learn the stock market in school. You’ve got to learn it on your own, like the music business.
And Burry’s returns at his Scion fund are confoundingly large. It’s all about value. He bets on fundamentally sound companies that are experiencing a bit of trouble. He hangs in there during the downward spiral in order to ride the roller coaster to the top, making beaucoup bucks along the way.
This is like investing in a band that may not look great, may need to woodshed a bit, may need to make three or four albums, but when it gets it together will be a gold mine. We can call it the Kings of Leon. We can call it artist development. We can call it ANYTHING but flavor of the moment.
That’s the point. Are you willing to do it differently? Are you willing to do the work and come up with your own conclusions, your own solutions? That’s Steve Jobs’ way. When everybody said you’ve got to have open standards, he promoted closed systems. And now he’s the big winner.
And Burry got so deep into it, figuring out when and what mortgage bonds were gonna tank, that he bought credit default swaps and made…enough money to buy your entire neighborhood. And the one next to you. And the one next to that.
By being brilliant. Even though so many investors said his plan was lunacy and wanted no part of it.
THIS is the American story. Not making a mix tape and partying with Paris Hilton and getting a photo in TMZ… Snooki is a diversion for the masses, the losers. Do you want to be a winner?
Winners start off in the wilderness. They do it their own way. They stick to their guns. They work incessantly and they never give up.
Whew. That just does not sound like enough people in the record business, on either side of the fence, talent or businessman.
We live in a confusing, crazy world. But one thing is constant. The winners pay their dues. And it’s not solely time on the chain gang. No, there’s a ton of anxiety involved. Questioning yourself, taking risks, sticking to your guns when no one believes in you.
It’s every man for himself out there. Shouldn’t be, but it is.
There’s a safety net in Canada. In Sweden. That’s the socialism you decry. But in the good old United States, the game is stacked against you. Those with power, with money, have erected walls to keep you out. And if you think kissing butt is the way to get ahead, you’re delusional. It’s not about how you can get signed, it’s about how you can beat Universal at its own game. You’ve got to be smarter than Lucian Grainge. Believe me, these people exist. And they’re gonna be the winners. They’re the ones we’re gonna be reading about in “Vanity Fair” five years from now.