Andrew Ross Sorkin on Oprah, Elon Musk, AI, and the Next Big Stock Market Crash

0:00There is no question that there is going to be some kind of crash or major correction in the stock market. Look, the thing about gambling on sports, people are betting on everything from politics to, you know, when Taylor Swift and Kelsey are going to get married. At some point, the florist is going to know when they're getting married or where they're getting married. Where do you see the business of music going? Live, live, live and more live. Elon is three or four people. I did not know that we'd get there as quickly as we did. Somebody's going to try to blackmail me with advertising? Blackmail me with money?

0:32Go yourself. Hey, I'm Andrew Osorkin. This is Boardroom's Cover Story.

0:45What's up, everybody? And welcome to the October Boardroom Cover Story. Today, I am sitting with best-selling author, host of Squawk Box, creator of Dealbook, and my co-host for Gameplan, and my friend, Andrew Sorkin. Welcome to the show. Thank you for having me. How does it feel to be interviewed? A little weird. I'm usually on the other side of this, so I'm excited and slightly nervous. I tend to think that I have a good gauge on people that are resonating loudly in the zeitgeist. And you resonate even beyond this zeitgeist that I speak about. But lately, it feels like you have become completely acknowledged across the board for this space that you're in that nobody else is in.

1:36That I think you do better than anyone. And it seemed to have culminated with the release of your book and the press you got about your book. But it made people start to ask a lot of questions in my world about just like, how does he do it all? How does he wake up every single morning to host Squawk Box? Not well. Run Dealbook, host one of the biggest conferences in the world in Dealbook, and now write a book that looks like it's 10 ,000 pages. I like to do a lot of things. I really do. I think it's like I sort of have an insatiable curiosity to see what's possible. So what does a day in the life of Andrew Sorkin look like?

2:20Oh, God. Okay, so I wake up about 4.30-ish, which, by the way, is late, apparently, in morning TV land. Okay. Show starts at 6 a.m. I usually spend half hour, 40 minutes actually going over Dealbook, which is the newsletter that's going to come out later. Then taking a shower, racing to the studio. I do the makeup like it's NASCAR. Do the show, 6 to 9. 9 o 'clock rolls around. Then I usually do Morning Joe. Then I usually have a bunch of meetings. Start prepping the next day's Dealbook. Maybe go to a lunch meeting. Maybe either more meetings, podcasts, other things in the afternoon. and then writing again to get the next day's deal book rolling.

3:06And hopefully in between, I got three kids, maybe having dinner with them, seeing everybody, if I can sneak a gym session in. That would have to happen in the morning. That would have to happen after. Not before Squawk. No, no, after Squawk. That would be like a 10 o 'clock thing. If I could squeeze an hour, because if I can't get it done then, by 4 o 'clock, I'm fried. There's no way that's going to happen. and then sometimes back out again because there's all sorts of stuff happening in the city. All sorts of stuff happening. Is DealBook a big team at this point? Not a huge team. No, it's about a half a dozen of us.

3:39And then we have a team that works on the event as well. So, you know, we're sort of a SWAT team of folks. And that grows sort of accordion style as we get closer to the event typically. To the event. And DealBook you created when? 2000? 2001. In fact, we were supposed to publish the week of 9-11. I was actually working on the prototype, sort of one of the planned newsletters, just to see if we could pull it off. And then we pushed it for a couple weeks, but then we went through it. And so 2001, the world isn't saturated with newsletters. There were none. Yeah. We were one of the first ones doing it.

4:18The idea was I was working at the New York Times. I was covering business and meeting all sorts of Wall Street bankers and people in the business. And the truth was, a lot of them would say to me, Sorkin, you seem like a nice kid. We get the Times at home, but I read the front page, I read the sports page, and then I take the Wall Street Journal with me on the train to work. And that was like dagger to the heart. I was like, ugh. And so I thought, okay, how am I going to get in front of these people? Newsletter. going to go straight direct inside their inbox. And I'm going to show them what we're writing, show them we're competitive, and then not just that we're competitive, I'm actually going to show them all the other articles that everybody else is writing.

5:02And back then, nobody was doing that. I mean, the idea of linking to a competitor was like anathema. I remember people at the Times thought it was wild that we were going to basically be promoting in their mind, you know, an article from the Wall Street Journal, the Financial Times or something. that's crazy and the new york times at that point saw your vision they didn't see your vision they saw the vision i don't think they saw it the same way i saw it yeah i thought there was a huge market i think they told me that they thought that there was probably a 30 000 people that we were going to reach and we've got you know a million plus now so did you growing up have this desire to A, be on television and B, a writer and a personality?

5:46And did you B, have this fascination with CEOs and business minds and world leaders like you seem to, obviously? Okay, so I was always fascinated by business. Totally. I always thought if you could follow the money, not in a cynical way, you could understand everything. Not just business, you could understand politics, you could understand sports, you could understand art. I never wanted to be a journalist. That was like so far from what I wanted to do. I had started a sports magazine, though, which you'd appreciate, when I was 15 years old. Wow. It's called the Sports Page Magazine. And I was building this magazine because I liked sports, but that wasn't really it.

6:23I thought I could sell advertising to young men. At the time, Seventeen Magazine could get you advertising to girls. Advertisers really wanted to get teenage girls. They couldn't get to teenage boys. and I thought I could do a sports magazine and that's how I'd make it work. And I used to, my mother would drive me to the city. I'd go to advertising agencies, try to sell my ads. But I was much more interested in that than I was necessarily being a writer. I always found writing hard. You know, I think some people have the visions of a writer like playing the keyboard like a piano with a smile. That's not, I still don't do it like that.

6:56Yeah. And then I got lucky. I was 18 years old. The New York Times had actually written a small little story about me and my magazine and I got an internship at the time. five weeks for free, supposed to Xerox, Staple, get coffee. And by the way, I was so happy doing that. Yeah. And there was a woman who had no idea how old I was. I had a suit on with a tie. And she overheard me talking about this thing called the internet in 1995. We'd write modem, comma, a device that transmits data over a phone line. And she asked me to write a story. And that's how my career began.

7:33so deal book now has a million subscribers yes the business is paid subscription and advertising not paid subscription we for free always always i've always wanted to have the right subscribers and i always felt like you know what we'll do better this way we've we've always had uh advertising has driven the business so how do you know you have a million of the right subscribers oh if you look at the list you'd be shocked if you're on the list the list is crazy The list is the craziest thing. I mean, and not just the list is crazy. The replies I get in the morning are crazy. I can't get over the fact that you'll be getting emails from the White House, from the biggest banks, the biggest tech companies.

8:13They respond to the DealBook newsletter? It is the craziest thing ever. And it's been like that for close to 25 years. Sometimes you know more about this. I can't believe you wrote that. Did you, you know, have you talked to so-and-so? So by the way, you should be looking into this. This other thing may happen tomorrow. You should check that out. All of those kind of things. So and how many of them are followed up by like, call me right now? People used to reply mostly the email. Now a lot of people are texting on top of that. And then you have this conference that you do at Lincoln Center. Every time I leave there, I call my wife, my closest friends, and I say, I don't understand how he does this.

8:55I rarely marvel at a feat. What you do that day is like MJ Game 6, where you'll go from CEO to celebrity of the moment to world leader to a head of a military in a time of war. Back to back to back to back. How do you do this? What thrill do you get out of this moment? and tell me a bit of how that then was created off of the success of the newsletter. I get such a thrill off of it. I mean, it's like it's my Super Bowl. It's what we do every year, and it just keeps getting bigger and better every year. You know, in terms of prep for it, it is like I'm no athlete, as you can tell, but it feels like whatever an athlete must do to prep.

9:48and the amount of time that I take for months often ahead of it to really be thinking through various questions. I mean, I'm always sort of creating this sort of like decision trees about places I can go. You know, I think the trick, and you're very good at this, is listening. So you can have all the lists of questions you want, but it's really the listening that matters. But I always feel like I, you know, I know that I'm starting at JFK and I'm going to end at LAX and I'm probably going to stop at O 'Hare and Denver and Dallas and Atlanta or whatever it is. But I also know the weather is going to change up there.

10:25And so we're going to have to flip this around a lot. So it's a lot about just sort of being prepped and then hopefully listening for some moment where you can go, oh my, now we can actually really take the plane somewhere else. deciding who speaks at the conference is completely your decision. Yep. How many years have you been doing it now? We've been doing the conference 14 years. Next year will be 15. Is there a guest that you still haven't booked that keeps you up at night? I've talked to Oprah a lot about doing it. It's cool to me that I can even say that I've talked to her, frankly. That was a good flex, man.

11:02It's not a flex. I can't even believe it myself. But I haven't made it happen yet. I hope I'm going to make it happen one day. She's the GOAT, though, to me. I mean, she's the – look, I grew up watching her do this. Yeah. And talk about an interviewer. Like, she, to me, not only figured out how to do this piece of it, but obviously created this, you know, multi-billion dollar business. And the ability to speak to anyone from anywhere in life. Anyone, yeah. What was the Elon Musk interview like? I was there for it. It was wild. So I think a lot of people thought it was wild from the outside. And I don't want to say I didn't think it was wild.

11:37I recognized it was wild. I wanted to show the true Elon. I wanted you to see Elon the person. Because Elon is three or four people. And I thought, okay, Walter Isaacson had just written a biography of him. And I thought, we're going to do this in real life. People are going to see all the different versions of Elon over the course of an hour, hour and a half period. And even when he was upset, I thought maybe we'd get to that towards the end. I did not know that we'd get there as quickly as we did. If somebody's going to try to blackmail me with advertising, blackmail me with money, go f*** yourself.

12:21But go f*** yourself. Is that clear? And so in that moment when he's cursing about the advertisers, I you know some people were very upset with him they couldn't believe he was saying I didn't feel the way at all I felt like okay I could I've known him for a long time I felt like just coming from sort of a tough place he was so upset and I I like to think I'm very empathetic I mean I'm always trying to put people myself in other people's shoes and I thought okay we're going to take this and we're going to figure this out we're going we are going to make this work now and And in that moment, it was like, how can I meet him where he is?

13:04Not where I want him to be, maybe where the audience wants him to be, but it's my job in this moment to meet him where he is and figure this out. There was a pivot. We sort of turned in that moment to talk about, and this goes a little bit to the prep. I had found this quote where he had said that his mind was like a storm. And I thought, okay, this is the moment I drop that in the conversation. He was frustrated. He was upset. I thought I could actually bring him back by saying, OK, look, I remember you said at one point that your mind was like a storm. Let's talk about that. He said my mind is a storm.

13:41I don't think most people would want to be me. They may think they want to be me, but they don't know. They don't understand. What did that mean? And actually, in a weird way, it sort of settled him. And then it became very introspective very quickly, where all of a sudden he actually was, he got into what that even meant. When people try to really understand you, I think that there's a lot of this comes from some other place. And I want to talk about that. What do you think that is? It was like a psychiatrist's couch or something. And you gave the audience an opportunity to empathize a bit. In a weird way, right?

14:16Yeah. You explained him or gave some context to him. Look, that's what I'm listening to. Look, we're all humans. and I think like the news business across the board oftentimes everybody feels like a character they feel like it's black or though it's white yeah everything's gray everybody's got their own demons everybody's got all sorts of things going on inside and I think if people can see the other person as a person and not some big powerful anything by the way most powerful people that you know, I think, don't think they're powerful. No, a lot of them have an imposter syndrome. But I also think that what you have an incredible gift of doing with some of these, like, business titans and world leaders is similar to what some of the great music and sports managers understand, which is that there's something very lonely about a lot of these, like, iconic figures.

15:14Yeah. That the conversations they have with people are very rarely human. Yep. and people are very guarded or nervous around them and that permanates and then they're uncomfortable and I think the fact that you are able to relate and know this about some of these people give them this ability to feel so safe there like I remember watching the way Jeff Bezos sat with you it was like he was sitting like his living room like he couldn't have been more at ease speaking to you and the same thing happens with everyone you speak to on Squawk Box every morning look I don't know why that is but I like to believe it's because I think the other person knows that I want them to hit the ball back I'm not trying to strike them out I'm not trying to ace them now I might try to place the ball in the corners because I think the audience wants to see them run but I'm but I am I'm hoping they hit the ball right I want them to hit the ball it's better if we're rallying back and forth yeah that approach even when I'm asking tough questions is different than some other people who are in journalism who I think would prefer to ace them.

16:19But that's because I love this stuff. That's because I've spent my whole life just studying this stuff, talking to them. I mean, I find these people and what they do to be the most fascinating thing in the world. Like, for real. It's as genuine as genuine could be.

16:36All right, let's get to your books for a second. You do like writing, clearly now, to write books that, no joke, it's this thick. It's this thick. But hopefully a bee tree. No joke. I want you to read this book and think cinematically like it's a bee tree. That's literally the intent of that book. You wrote your last book a year after the housing market crashed, right? Yep. 2008, the crisis happened. Lehman Brothers, the banks all are falling apart. The bailouts are happening. And the book was out literally October 2009. It was like a sprint. It was like sprinting a marathon. I was working at the New York Times, writing the front page story in 2008 when everything went down.

17:19I went home. I woke up my wife. It was 2 o 'clock in the morning. I said, you're not going to believe what just happened today. Lehman Brothers filed for bankruptcy. Merrill Lynch was sold to Bank of America. AIG is about to fall apart. All the taxpayers, all of it. And I looked at her and I said, it's like a movie. It's crazy. It's like a movie. And she said, no, no, it's like a book. You've got to go write the book now. So this is this because for years I thought, oh, I should try to write a book again. Like on my bucket list. Could I ever could I even write a book? I had never written more than a couple thousand words in my life.

17:54By the way, when they gave me the advance, I used to tell my wife we're going to have to give it back. I didn't think I'd be able to do it. So but then I thought this book has to come out quickly because also there was a lot of competition. A lot of people running around trying to write books like this. I thought I got to get there. That was a reaction to this insane moment in history. This you've been writing for eight years. Eight years. And it just so happens to line up with an insane moment in history. Right. Totally. You started this in, that means 2017. So Trump was in office. Yes. But the economy was healthy at that point.

18:33Yeah. No, I was not thinking about today. You weren't thinking about how this. No, no. What was happening was I would go meet people who had read Too Big to Fail, and they'd say, Sorkin, so how did 2008 compare to 1929? And I never had a good answer for them because I didn't know much. All I knew was that something terrible happened in 1929. It led to the Great Depression, at least I thought. I thought, I've got to get smart on this. So I started reading about it. I thought, wow, these people are really interesting. But nobody had done a book that I thought really brought you inside the room where you could see the characters not as black and white, but you could actually see who they are and what were their motivations and their incentives and who they're having affairs with and what were they saying to their wives and their husbands and like what was going on literally inside the White House and how did they all interact?

19:22And I thought, that's like a soap opera to me. And for whatever reason, nobody had really written that book. In large part, by the way, I think I understand now. Because to find the material, the granular material that would get you like the quotes. And everything has to be real. Can't make any of it up. There wasn't like an archive or two or three. That's why it took eight years. It was like finding all of these disparate pieces from all over the country. And very few people, if no people, that you could probably speak to actually. Everybody was dead. And mostly even the family members, we were talking about, they weren't even children, sometimes grandchildren or great-grandchildren.

20:03I needed to find these letters and these memos and board minutes and all of this stuff so that you could be right there with them. Totally changed my whole perspective on it because I thought there was like one day there was a crash. You heard people talk about like a Black Tuesday or Black Thursday. By the way, it was multiple days. And then it was like dominoes. And it wasn't that there was just a crash. It was then the crash was sort of the first domino of all these other things that were happening in Washington where then Hoover and others just made mistake after mistake after mistake. It was not preordained.

20:37You could have had a crash in 1929 and not had the Great Depression. But it was sort of the combination of sort of all of these things that were happening that led to this terrible moment where we had 25 percent unemployment in the United States, which is incredible to think about. That's insane to think about. Twenty five percent unemployment? Unemployment. So the unemployment rate in 1932 was 25 percent. 9000 banks failed. There were these things called Hoovervilles, basically tented camps. People had set up camps in the middle of Central Park to live because they had no money. People had mortgaged their homes.

21:19They didn't have homes. I mean, it was completely other level. I mean, 2008 financial crisis, we got up to about 10 percent unemployment. And that was for like a year. This was like a whole different situation. So if you went to bullet point and clearly streamlined what happened in 1929, What would you say? So what happened was you had an entire country that had turned stock trading into a national pastime. Everybody was buying stocks. There were brokerage houses popping up on the streets like Starbucks, literally. And you could walk in and they would loan you money to buy stocks. So you would give them a dollar.

22:03They would give you$10. Nobody had ever done this before. So this is their sort of first time doing it. And the stock market is going up like at crazy rates. So from 1928 to September of 1929, the stock market was up 90%. This is the first time most Americans – so they thought – everyone thought they were completely so rich they couldn't even believe what was happening to themselves. In October of 1929, the whole situation broke. And because so many people had taken such big loans, it wasn't just the stock fell 10 or 20 points. It was that then they owed like quadruple that. And so all of a sudden, to pay back the bank, they were either taking mortgages out on their homes or literally losing their homes.

22:53And was it because, similar to most bubbles, these companies were not anywhere near the value of these stock prices because of the access that everyone had? Completely, because what had happened, and this is a whole 1920s, there was a euphoria around all this new stuff. So automobiles are a thing for the first time, really. How many companies are even on the New York Stock Exchange at that point? Oh, there were, I believe, hundreds of companies. But, you know, the big stocks were telecommunications companies. The hottest stock was RCA. Not records, but radio. RCA. The ticker was radio. It was the NVIDIA of its time.

23:36It was a meme stock. And everybody wanted to own RCA. And RCA did not make any money. But it had patents on television. So it was the future. It was like AI. It was the future. It just, there was, the economics weren't there yet. You mentioned AI. Did it scare you writing this book to think about not similarities, but how this could easily happen on an even grander level? Well, so I'm hopeful that it actually, I'm praying that it can't happen on an even bigger level, like that we're not going to have another Great Depression. Because there are a lot of things that are different. There was no SEC.

24:15You could, by the way, insider trading was legal back then. You know, there was there was there's no rules around banks. There was no disclosure on anything. I mean, you know, there wasn't a prospectus for a stock. There was like a leaflet. Maybe that's how you you'd get the information. So I like to think that we're hopefully not going to go that far. But as I was writing the book, yeah, there were things I'd go, oh, my God, this seems very similar to 1929. And by the way, in the 1920s, they all talked about democratizing finance. The elites had access, and this was like a big opportunity for the rest of the world to get their shot at the lottery ticket.

24:57I think a lot of that's happening now. Like in crypto, people want the lottery ticket. Yeah. And, you know, sometimes I go on TV and I'm like cautioning people. Oh, goodness. You know, GameStop. Be careful. Be careful about this. Be careful about that. And what's so interesting is people send you notes and they say, Andrew, don't don't try to protect me. I don't want to be protected. And by the way, you're not really protecting me. You're protecting the man. You saying that actually does impact them monetarily speaking as well. Oh, totally. Look, I mean, it's a huge responsibility. I would say actually that, which I do think I learned probably in my early 20s, that I could write an article or say something on TV and you could move a stock by, in some cases, billions of dollars, which is an incredible and scary thing.

25:46Are there limitations to what you can say from that standpoint on CNBC? There must be, right? The answer is to be as responsible as you humanly can. And, you know, I'm not allowed to buy individual stocks, for example. So, you know, the whole idea is that I can be a true sort of independent voice on these things. I can own mutual funds and things like that. But no stocks. And by the way, this kills my children. I got kids. I got 15-year-old boys. And they're like, Dad, come on. I want to be able to buy this. They want to buy it. And I'm like, you can't. Your kids can't? Well, because I'm always worried.

26:20What happens if they buy shares in Apple? and then somehow I, and let's say they buy shares of Apple tomorrow and that somehow that I know in advance that Apple's going to go have this for their earnings or that Apple's going to go do this merger. And I never might have talked to the kids, but I don't want anyone to ever say that something weird's going on. This is, by the way, what happens in Congress. Yeah. But I don't think if I did it with you, no one would say anything was weird. You know what I'm saying? Like we could potentially invest together. Right? We're going to get arrested. I don't know.