Bill Ackman has grown Pershing Square Capital Management to more than $16 billion from $54 million since he founded the fund nearly two decades ago. The 57-year-old activist investor speaks with On The Money about his return to office policy, his possible presidential picks and why he’s still bullish on New York City.
Lydia: You are among the big names on Wall Street who didn’t move to Florida. Why?
Bill: The short answer is that I love New York City. My desire to be successful is founded on a desire to be independent. It always seemed crazy to me to sacrifice that independence to save money on taxes. If you make $100 million — some people in finance make even more than that — you can save $25 million of that by living somewhere cheaper.
Some people choose to manage their lives that way. I do think it’s incumbent upon New York City to make this a desirable place to live and we have to make it an attractive place to do business. If one super wealthy person leaves the city — that’s really bad for the revenue. I don’t think it’s smart to push taxes higher — I think that would actually generate less revenue.
Lydia: There have been some top players in finance like Ken Griffin who have made a show of moving to Miami and talking about how smart it is for their business. But do you think that trend will be reversed? Will we see a lot of headlines in the next year about people moving back?
Bill: I think it’s a great thing that [Citadel founder] Ken Griffin is building a major campus, if you will, in New York City on Park Avenue. I think that’s an amazing thing for NYC whether it’s his primary office or not, and it speaks to the fact that a lot of the youngest, most talented people want to be here. My nephew graduated from Harvard and many of his classmates moved here even before they had a job. The city is still a big draw for young people and if this is where the talented, young people want to be, then the companies will have to have a major presence here.
Lydia: Given the younger generation wants flexibility, is it realistic to expect people to return to the office five days a week? On the flip side, can New York City flourish if you don’t have people back in Midtown and back in office buildings?
Bill: Everyone wants more flexible work — whether it’s a school play, a sports game you don’t want to miss — and we have technology that lets you do that. What we’ve done at Pershing Square is bring people back five days a week 10 months a year. Of course if there’s something you need to do like a doctor’s appointment or working from home one day, use your best judgment. And then we give people July and August to work from anywhere with the caveat that if there’s something where we need to bring everyone together, you show up. We’ve experimented with that for two years and that’s worked well, people like the balance, and it works for our business.
Lydia: And you believe New York will still be a place where businesses want to operate?
Bill: I think if NYC became an unsafe place — the images you see of San Francisco where you have open air drug users lying on the street — that would be very damaging and could be a tipping point for people leaving the city.
You have to manage the city and its population effectively. In San Francisco you have homeless people acting in a threatening and hostile way — that’s led to the emptying out and death spiral of San Francisco. Again you want to manage a city so that it is pro-business and pro-resident and you want to show care for people who are less fortunate, but that doesn’t mean they can defecate on the street and threaten parents or kids.
Lydia: Is NYC poised to go into that kind of death spiral?
Bill: No, I don’t think so. We have a mayor who has — for obvious reasons – respect for the police force and I think they respect him. I think that’s really important. The whole defunding the police movement was not a good one. Bail reform went too far. If you believe the statistic, it’s several hundred people committing the vast majority of street crime and those people should be locked up.
Lydia: The new movie “Dumb Money” and the meme stock craze — clearly a cautionary tale of a short bet gone wrong. What do you make of that film?
Bill: We are among the most famous short sellers but that’s because we shorted two stocks in the last twenty years. One short there’s a movie about — Herbalife [“Betting on Zero”] — and the other short there’s a book about — MBIA [“Confidence Game”]. But we don’t short stocks for precisely the reason you say. We gave up that business a long time ago because it’s too risky. Even when you’re right you can lose a lot of money. Of course, short sellers can do amazing research.
Lydia: You’ve publicly applauded the work Hindenburg has done on Carl Icahn’s firm. How are you thinking about Icahn now? Do you think the report captured what’s going on at his firm?
Bill: What Hindenburg said has been proven out.
Lydia: You’ve expressed support for a lot of different 2024 presidential candidates. Anyone else you plan to support?
Bill: I’d love Jamie Dimon to be president but he’s made it clear he’s not going to run. I’d love for a candidate of his quality to run. I think Biden-Trump part II is not the best option for America. It would be great for us to be brought together by a more centrist candidate that members of both parties can vote for.
Lydia: What about Vivek or RFK Jr. you’ve tweeted support for?
Bill: I’d like to see multiple alternatives. I’ve been supportive of Vivek because I know him and he’s super smart and capable. I wish he was a more centrist candidate. I’ve not yet met RFK but hopefully will have an opportunity to do so. But I still haven’t found my ideal candidate. Biden should step aside and that would create a flurry of alternative candidates. People are afraid to run against the president and I think there’s some possibility of that happening.
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