Howard Marks grew up in Queens, studied finance at Wharton, and trained under the Chicago School’s efficient market hypothesis before watching the Nifty 50 collapse early in his career. He learned that it’s not what you buy, it’s what you pay. He eventually moves into high yield bonds and becomes one of the first institutional investors in the market.

Bruce Karsh was a rising star as a lawyer before stepping out to work for Eli Broad analyzing investments and structuring transactions. His work on the Johns-Manville asbestos bankruptcy planted the seed of an idea that would evolve into distressed investing.

By 1988, the two had found each other at TCW in Los Angeles with a shared philosophy around investing at the right price, tracking the market cycle, and finding good companies with bad balance sheets to invest in. By 1990, with high yield default rates above 10%, Drexel bankrupt, and collapsing demand for bonds, Howard and Bruce were on their way to building a reputation as legendary credit investors.

Chapters

(02:50) Context on Howard Marks and Bruce Karsh

(06:45) Howard’s early career: Wharton, the Chicago School, and the efficient market hypothesis

(10:32) The Nifty 50: one-decision stocks and their collapse

(15:26) Howard moves to bonds and Bruce Karsh goes from law to investing

(19:47) Howard meets Milken and discovers high yield bonds

(25:22) Howard builds Citi’s high yield portfolio and moves to TCW

(30:34) Bruce Karsh’s distressed debt thesis and joining TCW

(39:42) The Howard Marks investment philosophy: market cycles and probabilistic thinking

(42:39) The 1989-91 crisis: S&L collapse, FIRREA, and the high yield market meltdown

(52:18) Deploying capital in the crisis, TCW’s 45% returns, and founding Oaktree

References

Howard Marks Investor Series with Bruce Karsh (link)

Howard Marks Memos, The Complete Collection (1990-2025) (link)

The Most Important Thing by Howard Marks (link)

Mastering The Market Cycle: Getting the Odds on Your Side by Howard Marks (link)

Acquired with Howard Marks and Andrew Marks (link)

Junk Bonds: How High Yield Securities Restructured Corporate America by Glenn Yago (link)

Beyond Junk Bonds: Expanding High Yield Markets by Glenn Yago, Susanne Trimbath (link)

Sponsors

Big thanks to EQT Corporation for helping us bring you the stories of market history and how they apply today. To learn more and explore the latest data on energy affordability, go to eqt.com/energy-affordability.

Note: this show is for informational purposes only and isn’t investment advice. Backtest hosts and guests may have investments in the companies discussed.

But that’s not the whole story. As our guest Bob McNally so eloquently points out, part of what makes this market so fascinating and so complex is how volatile oil prices can be and how often the load-bearing assumptions of market participants break down.

Arguably the entire history of oil is the history of our repeated attempts to manage its price volatility. And no one understands that better, or has been right more often during times of crisis, than Bob McNally.

In this episode, we sit down with Bob—founder of Rapidan Energy Group, former White House energy advisor to President George W. Bush, longtime hedge fund analyst at Tudor Investment Corporation, and author of Crude Volatility—to add historical context to the crisis in the Strait of Hormuz, to better understand how oil markets work, and to shed light on the psychology of market participants and policy makers.

You can find Bob on X (@Bob_McNally) and LinkedIn. You can find Rapidan Energy Group at https://www.rapidanenergy.com/

Chapters

(01:38) Variant perception and Bob’s Iran call

(08:19) Why the market misread Hormuz

(10:56) Why oil prices are uniquely volatile

(17:06) The Texas Railroad Commission: OPEC before OPEC

(23:00) Spare capacity and the swing producer

(30:38) How the U.S. lost the swing producer role

(38:11) How OPEC took over market management

(49:50) How shale changed the oil market

(54:11) How policy makers make decisions during energy crises

(1:01:28) Second and third order effects from the current crisis

References

Crude Volatility: The History and the Future of Boom-Bust Oil Prices by Robert McNally (Link)

“Ships stranded by Strait of Hormuz closure” 60 Minutes on CBS, March 15 2026 (Link)

Chart: oil supply shocks and spare capacity since 1955 (Link)

Oil Market Black Swans: Covid-19, the Market-Share War, and Long-Term Risks of Oil Volatility by Robert McNally (Link)

A Crude Predicament: The Era of Volatile Oil Prices by Robert McNally and Michael Levi (Link)

Sponsors

Big thanks to EQT Corporation for helping us bring you the stories of market history and how they apply today. To learn how EQT is unlocking energy to power AI, go to PoweredByEQT.com.

Note: this show is for informational purposes only and isn’t investment advice. Backtest hosts and guests may have investments in the companies discussed.

The answer leads us to Fred Carr, a largely forgotten figure who may be the most important person in 1980s finance that almost nobody has heard of. A scrappy outsider from Watts, Los Angeles, he first rose to fame as the hottest mutual fund manager in America during the go-go years of the late 1960s before flaming out spectacularly with the Enterprise Fund.

His second act was even bigger. In 1974, Carr took over a near-bankrupt life insurance holding company called First Executive Corporation and transformed it into a powerhouse. He pioneered single premium insurance products that offered higher yields than competitors, built a revolutionary sales incentive model, and earned top-tier safety ratings that unlocked massive institutional capital flows from pension plans and municipalities.

First Executive became the largest buyer of high-yield bonds in America, participating in 90% of all Drexel underwritings between 1982 and 1987. But when the junk bond market collapsed, the same concentration that fueled Carr’s rise became his undoing.

Along the way, we explore how insurance companies work, why the end of the Great Inflation broke every financial business model in America, how regulatory gaps allowed risk to build invisibly, and why the California aftermath of First Executive’s collapse became very relevant to one of the biggest financial institutions in modern finance.

Chapters

(01:36) Set up to sources of capital for the junk bond boom

(07:11) Fred Carr’s origin story: from Watts to Wall Street outsider

(12:16) The go-go years and the Enterprise Fund’s meteoric rise and fall

(19:30) First Executive: taking over a near-bankrupt insurer and starting over

(23:23) The Great Inflation breaks insurance: why old business models stopped working

(27:22) The Milken-Carr flywheel: high-yield bonds meet single premium insurance products

(39:03) First Executive becomes a junk bond giant: growth, ratings, and warning signs

(48:56) The collapse: Drexel’s bankruptcy and its consequences for the junk bond market

(1:03:15) Seizure, conservatorship, and the wild aftermath with Apollo and Credit Lyonnais

References

The Fall of First Executive: The House That Fred Carr Built by Gary Schulte

Perceptions and the politics of finance: Junk bonds and the regulatory seizure of First Capital Life, Journal of Financial Economics, 1995 (link)

Dangerous Dreamers: The Financial Innovators from Charles Merrill to Michael Milken by Robert Sobel (link)

Junk Bonds: How High Yield Securities Restructured Corporate America by Glenn Yago (link)

Sponsors

Big thanks to EQT Corporation for helping us bring you the stories of market history and how they apply today. To learn how EQT is unlocking energy to power AI, go to PoweredByEQT.com.

Note: this show is for informational purposes only and isn’t investment advice. Backtest hosts and guests may have investments in the companies discussed.

Instead, as soon as the board issues the customary press release announcing the buyout bid, RJR Nabisco is in play as the most prized buyout target on Wall Street.

Ross Johnson alienates not one, but two major players on Wall Street: Henry Kravis from buyout specialist firm KKR and Jeff “Mad Dog” Beck from junk bond specialist Drexel Burnham Lambert. It turns out $75-per-share is far from a winning bid.

What follows is the most dramatic LBO fight in history: bear hugs and tender offers, bank exclusivity plays, bidders posturing and bluffing, interlopers wanting to plant their flag in the LBO game, and directors getting ambushed in the hallways by bankers hunting for an edge.

Chapters

(01:04) Recap: Ross’s $75 management bid frames as an “inside raid”

(03:30) The board meeting and the press release that put RJR in play

(06:31) Kravis takes it personally: why KKR has to enter the fight

(07:54) Meet Drexel’s “Mad Dog” Jeff Beck (and why he matters)

(14:33) The stock becomes a battlefield: arbitrage, piling in, and momentum

(17:11) KKR goes on offense: the $90 tender offer and the greed narrative

(25:30) The auction gets hot: new bidders, higher prices, and board pressure

(42:28) The final vote—structure, certainty, and the aftermath of the deal

(45:54) Lessons learned

References

Barbarians at the Gate: The Inside Story of America’s Most Notorious Corporate Takeover by Bryan Burrough, John Helyar (link)

RJR Nabisco: A Case Study of a Complex Leveraged Buyout, Financial Analysts Journal, 1991 (link)

Junk Bonds: How High Yield Securities Restructured Corporate America by Glenn Yago (link)

Dangerous Dreamers: The Financial Innovators from Charles Merrill to Michael Milken by Robert Sobel (link)

Sponsors

Big thanks to EQT Corporation for helping us bring you the stories of market history and how they apply today. To learn how EQT is unlocking energy to power AI, go to PoweredByEQT.com.

Note: this show is for informational purposes only and isn’t investment advice. Backtest hosts and guests may have investments in the companies discussed.

Ross Johnson, the CEO of RJR Nabisco, watches as his stock price gets cut in half in a day… even though the business and the economy are fine.

Over the next year, he tries everything from asset sales to share buybacks to convince the market there’s a lot more value at RJR Nabisco than they’re giving him credit for. Nothing works.

Meanwhile, leveraged buyouts are hot on Wall Street but that’s the one solution Ross Johnson isn’t willing to try. He’s a brilliant political operator who can manage board members, who loves perks, and hates constraints. But above all, he can’t stand that the market keeps pricing RJR Nabisco like a doomed tobacco company. That frustration overcomes his aversion to LBOs, and he makes his move on October 19th, 1988—exactly one year after Black Monday.

Chapters

(00:43) Welcome + recap: from junk bonds to the LBO era

(03:35) 1987 at the top: bull market euphoria, Berlin Wall optimism, Fed hikes

(05:24) Portfolio insurance: Black-Scholes in the wild and the “mechanical” selling logic

(09:58) Black Monday: the crash day and why it shocked everyone

(11:35) RJR’s stock collapse: the bargain that changes the story

(11:45) Meet Ross Johnson: perks, power, and the 80s CEO archetype

(28:17) LBOs 101: the mortgage analogy + why leverage can create value

(31:54) ERISA & pensions: Prudent Man Rule clarification unleashes institutional capital

(41:22) KKR’s rise: Henry Kravis, fund economics, and the LBO machine

(52:03) Ross’s playbook: buybacks, tobacco overhang, and the $75/share MBO spark

References

Barbarians at the Gate: The Inside Story of America’s Most Notorious Corporate Takeover by Bryan Burrough, John Helyar (link)

RJR Nabisco: A Case Study of a Complex Leveraged Buyout, Financial Analysts Journal, 1991 (link)

Junk Bonds: How High Yield Securities Restructured Corporate America by Glenn Yago (link)

Dangerous Dreamers: The Financial Innovators from Charles Merrill to Michael Milken by Robert Sobel (link)

Sponsors

Big thanks to EQT Corporation for helping us bring you the stories of market history and how they apply today. To learn how EQT is unlocking energy to power AI, go to PoweredByEQT.com.

Note: this show is for informational purposes only and isn’t investment advice. Backtest hosts and guests may have investments in the companies discussed.

Before all that, in the early 1970s, a young Michael Milken joined Drexel to focus on low-grade bonds. He had discovered the research of W. Braddock Hickman, which concluded low-grade bonds could generate attractive investment returns, and he became obsessed. He was ambitious, smart, and an outsider when he got to Wall Street. Within a decade, he would be at the center of it.

In this episode, we tell the origin story of the high-yield bond market—and how Michael Milken, from a backwater desk at Drexel, turns a stigmatized corner of finance into the most powerful funding engine on Wall Street.

At first Drexel focused on trading “fallen angel” bonds. Then they moved aggressively into underwriting new high-yield deals, and created a flywheel: more issuance, more buyers, more liquidity—all underpinned by a rigorous knowledge of the market that no one else could match.

Along the way, we pull out lessons that rhyme with modern cycles: why market “infrastructure” matters as much as the math, how scar tissue from the last decade warps risk-taking, and how a productive innovation can—at scale—start to fuel excess.

Chapters

(04:06) Wall Street in the 50s/60s

(07:25) Michael Milken’s background

(11:24) Intro to bonds and market structure

(12:56) Braddock Hickman research and the logic for high-yield bonds

(18:34) Michael Milken lands at Drexel

(23:42) The 1970s, stagflation and brutal markets

(30:41) Michael Milken almost leaves Drexel then he gets capital to manage and doubles it

(49:13) Expanding the market by creating new high-yield bonds from scratch

(57:48) High yield fuels the rise of leveraged buyouts and corporate raiders

References

Dangerous Dreamers: The Financial Innovators from Charles Merrill to Michael Milken by Robert Sobel (link)

The High-Yield Debt Market: 1980-1990 by Richard Jefferis, Jr. (Federal Reserve Bank of Cleveland) (link)

Junk Bonds: How High Yield Securities Restructured Corporate America by Glenn Yago (link)

Innovations in Finance, Medicine, and Education with Michael Milken, Capital Allocators Podcast by Ted Seides (link)

Sponsors

Big thanks to EQT Corporation for helping us bring you the stories of market history and how they apply today. To learn how EQT is unlocking energy to power AI, go to PoweredByEQT.com.

Note: this show is for informational purposes only and isn’t investment advice. Backtest hosts and guests may have investments in the companies discussed.

We launched the show in 2025 because we love Acquired and Founders, and we wanted a similar show for market history.

2025 was about landing the format. 2026 is about spreading the word.

That’s why we’re partnering with EQT Corporation to bring you Season 2 of Backtest.

Every technological breakthrough in history rides on infrastructure—canals, railroads, electricity, fiber. In the AI era, infrastructure increasingly depends on energy, and EQT is building and modernizing the natural gas ecosystem to enable affordable, reliable power at scale.

This partnership helps us keep doing what we do best—hundreds of research hours, sharp storytelling, and lessons you can apply—while expanding our reach and connecting our community to the infrastructure story behind the AI boom.

We’re grateful for EQT’s support, and we thank you, the Backtest community, for joining the journey to build the go-to podcast for market history.

Stay tuned for our first episode of Season 2 later this week. Spoiler alert: we may have to wear blue dress shirts with white collars and suspenders to really land this story.

For previous episodes of Backtest, and to keep up with future announcements, subscribe at backtestpodcast.com.

To learn more about EQT, go to PoweredByEQT.com and keep up with the latest updates by following them on X and LinkedIn.

First, we wanted to spend more time diving into the defining moments in market history—deconstructing what happened, how it worked, and why it mattered.

We are constantly reading, but we wanted to add structure and rigor to our approach.

We wanted to supercharge our learning.

Second, we suspected other founders, investors, and operators wanted the same thing. For years, we’ve tuned into shows like Founders, Invest like the Best, Acquired, The Rest Is History, and Dan Carlin’s Hardcore History.

We realized that a podcast could be a great way to channel our energy and curiosity. What’s more, we realized that even though we had a go-to podcast to “learn from history’s greatest entrepreneurs” (Founders) and a go-to podcast to “learn the playbooks that built the world’s greatest companies” (Acquired), we didn’t have a go-to podcast to learn the lessons from market history.

So we decided to build it.

As we look back on our first year, we are happy that we found a topic valued by so many of you. We shipped a total of 13 episodes, each backed by hundreds of hours of research.

We are proud of how far we’ve come, expanding our understanding, not just of market history, but of how to tell compelling stories.

Most of all, we are grateful for all the people who helped us this year by giving us honest feedback about the name, the format, the stories, and the research.1

We couldn’t end the year without reflecting on lessons we learned and how they may inform our understanding of markets in 2026.

The stock market bubble narrative

Today’s booming stock market driven by AI might sound a lot like the dot com bubble of the 1990s.

And yet, despite high valuations, stocks right now are not as expensive as they were in early 2000—especially once you compare cyclically-adjusted earnings yields to interest rates.2

During the dot com bubble, the Nasdaq price-to-earnings multiple (PE) reached 150x. Today it trades around 32x and the average since 2003 has been 23x. So valuations are certainly above the historical average, and we should keep a watchful eye on stock prices, but a major market crash from extreme valuations is not a foregone conclusion.

But it’s worth noting the level of concentration in the market. In contrast to the early 2000 period when the top 5 companies represented a little less than 20% of the S&P 500’s market cap, today’s top 5 companies represent closer to 30%.

The capital investment trends

One of the most noteworthy trends this cycle is the magnitude of capital being deployed on AI infrastructure. Capex is an important signal of future growth, cash flow, and productivity. It lights the way on where the economy, and underlying markets, are trending.

In the Shale Revolution series we touched on the natural gas pipeline build out in the 50s and 60s. We concluded that it was one of the most attractive investment opportunities at the time.3

We also talked about the massive amounts of capital invested in drilling activities during the 2000s, and how the returns failed to materialize after oil and natural gas prices crashed from oversupply.

In Part 2 of the Dot Com Boom series we talked about the capital deployed to build out fiber networks for the internet. This capital also failed to generate a financial return for investors despite laying down the infrastructure that allowed the internet to thrive for decades after.

These boom cycles tend to be sparked by a fundamental technological revolution. Then at some point, psychology gets a hold of market participants and hype drives capital towards less productive projects. We saw this in the 1990s when the telecom industry based investment on the belief that internet traffic was doubling every 90 days—true early in the cycle, but false by the time it was being used to justify projects.

The AI buildout is expected to become the largest privately funded capital project in history—bigger than Telecom, Pipelines, and Railroads. With trillions of capital on the line, and infrastructure underpinning another revolutionary technology, this will continue to be a trend to keep an eye on.

The high-yield credit markets

We didn’t expect the high-yield credit markets to play a prominent role across both the Dot Com Boom and Shale Revolution series.

We were surprised to learn that the dot com bubble burst in two separate waves. Before 9/11, the animal spirits fueling the dot com craze reversed in early 2000, crashing dot com stock prices. However the broader market and the real economy remained unscathed until late 2001 when economic weakness following the 9/11 terrorist attacks combined with a mountain of telecom debt to drive a much deeper, credit-driven bear market.

Tech & Telecom represented 35% of the high-yield market before the crash. For context, it was typically 10% prior to 1995 and has settled closer to 20% since the crash.

Similarly, during the height of the Shale Revolution, energy companies’ share of high-yield was 16%—much higher than its typical 12%.

Financing AI infrastructure will likely follow a similar pattern with some exceptions. The investment-grade nature of hyperscalers along with the relative magnitude of modern private capital markets means the high-yield credit market will likely absorb less of these capital needs. This will make it harder to track excesses in AI infrastructure.

The global monetary system

We studied the Nixon Shock to better understand what happens when the world restructures its economic operating system. The rise of China as a competing superpower to the United States suggests we may be going through another restructuring.

This is huge.

There are implications for defense, trade, and importantly for the dollar’s role as the world’s reserve currency.

We learned in Part 3 of the Nixon Shock series that Treasury Secretary John Connally helped usher in the fiat era in 1971 by telling the world “it’s our currency but it’s your problem.” The world was much different then, but gold remains a key indicator.

The fact that central banks—most notably China—have been increasing the share of gold in their reserves, and that gold prices, particularly relative to oil, have been consistently rising for several years are powerful market signals.4

But the US dollar remains firmly within the historical range when compared to other major currencies. With a new Fed chairman taking over in May 2026, this dynamic is worth watching.

Looking ahead

“The reward for great work is more work… The reward for great work is not money, power, fame. It is the privilege to get to do more of this thing that I love doing.”

—Patrick O’Shaughnessy in conversation with David Senra | Dec 21, 2025

We’ll be adding two core features to Backtest in 2026.

A few of you have been pounding the table for these since we started. We preferred to take our time to get these right. We’re confident we did and we’re excited to announce them soon.

We are also deep in research mode for our next series—the first episode will drop at the end of January.

In the meantime, thank you for coming on this journey with us.

Stay tuned and please spread the word.

We follow Papa and his lieutenants Bill Thomas and Gary Thomas as they see what others miss: shale’s success in natural gas will eventually create a glut that will crash prices. EOG must pivot to oil or stall. From a dramatic 2007 offsite where Mark tells his team to stop looking for natural gas, to early experiments in the Bakken, to a quietly assembled position in the Eagle Ford, EOG’s edge leads it to become a top US oil producer.

But before they can enjoy their success, the market turns again. On Thanksgiving day 2014, Saudi petroleum minister Ali Al-Naimi announces to the world that OPEC won’t cut production to balance global oil markets. Oil prices collapse by 60% over the next 12 months and the shale boom faces its first true stress test. We unpack why so many companies break—and why EOG doesn’t—ending with the playbook that helped shale survive: low cost operations, productivity gains from technology, focus on premium wells, and operating discipline built to survive boom-bust cycles.

Chapters

(04:56) Two questions: will shale oil work and can shale production be profitable?

(07:28) The operators: Mark Papa, Bill Thomas, and Gary Thomas at EOG

(08:16) The history of EOG

(11:32) The 1990s oil & gas market

(13:34) Two forces converge at Enron in the 1990s

(20:03) Being the low cost operator in commodity businesses

(21:55) Four things that define EOG

(29:32) The commodity supercycle of the 2000s

(33:03) EOG pivots from natural gas to oil

(45:55) EOG announces the Eagle Ford discovery

(55:25) The commodity supercycle and the zero interest rate environment

(57:21) OPEC surprise on thanksgiving 2014

(1:08:04) Lessons learned

References

Saudi America: The Truth About Fracking and How It’s Changing the World by Bethany McLean (Link)

Crude Volatility: The History and the Future of Boom-Bust Oil Prices by Robert McNally (Link)

The Accidental Oilman by Lawrence Strauss, Barron’s, October 2011 (Link)

The Frackers: The Outrageous Inside Story of The New Billionaire Wildcatters by Gregory Zuckerman (Link)

Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages by Carlota Perez (Link)

In this episode, we tell Aubrey’s story: from deep family roots in oil & gas to hustling as an independent landman in the brutal 1980s bust, to co-founding Chesapeake, taking it public in 1993, and doubling production year after year even as gas prices went nowhere. We follow the moment he and partner Tom Ward fly to San Jose to sit across the table from Calpine executives and realize just how much gas-fired power demand is coming—and why that meeting gives Aubrey the conviction to pivot Chesapeake almost entirely to gas in the late 1990s, just before Alan Greenspan warns Congress about tight natural gas supplies in the US.

We walk through how he uses every financing tool available—bank lines, high-yield bonds, converts, joint ventures, volumetric production payments, and massive midstream commitments—to plug billions in capital needs and amass premier shale positions in the Barnett, Marcellus, Permian and beyond.

We draw lessons on effective fundraising, capital cycles, commodity cycles and technological revolutions—and why going to the source for real market signals is still the best way to build conviction.

Chapters

(02:35) Alan Greenspan on natural gas as a headwind for US growth

(04:05) Aubrey McClendon’s early life

(07:02) Aubrey graduates from Duke and joins Jaytex

(09:48) Setting out on his own as a landman

(16:07) Chesapeake goes public in 1993

(22:55) 1998 natural gas inflection point for Chesapeake

(26:30) Chesapeake gets into shale

(32:55) How big capex gets financed

(44:38) Aubrey loses substantially all of his Chesapeake stock from a margin call

(49:29) Aubrey gets pushed out of Chesapeake & starts AEP

(52:47) Lessons learned

References

The Frackers: The Outrageous Inside Story of The New Billionaire Wildcatters by Gregory Zuckerman (Link)

Saudi America: The Truth About Fracking and How It’s Changing the World by Bethany McLean (Link)

Chesapeake’s 1993 Annual Report (Link)

By answering that question they changed the US natural gas market, global geopolitics, and the daily life of everyday Americans.

In this episode we tell the story of George Mitchell, the son of Greek immigrants who clawed his way from financial hardship in Galveston to build a multi-billion dollar energy business—first by using his technical skills to find natural gas others missed, then by signing a pivotal long-term contract to feed Chicago’s growing demand. That deal generates substantial cash flow, but it also becomes a ticking time bomb: as US gas markets lurch through decades of regulation, shortages, and deregulation, Mitchell’s core field starts to run out, and the company faces the real prospect of defaulting on its obligations.

Backed into a corner, Mitchell bets the future of his firm on the Barnett Shale—rock that industry experts say can’t be produced economically. We follow two decades of failed experiments, internal skeptics, and near-disaster until a young engineer, Nick Steinsberger, stumbles into a cheaper way to frack wells and finally cracks the code that turns the Barnett from science project into scalable resource.

Along the way, we zoom out to the larger gas market: how postwar pipeline build-outs, 1970s energy crises, and 1980s deregulation set the stage for Mitchell’s moonshot—and why this quiet breakthrough in North Texas is the reason today’s AI data centers, power grids, and geopolitics have the luxury of assuming abundant US energy supply.

Chapters

(01:07) Excerpt from The Frackers

(02:30) The US supply of energy for AI was unlocked by the Shale Revolution

(06:40) George Mitchell’s childhood

(11:21) George and Johnny Mitchell start Oil Drilling Co

(14:05) Finding the Boonsville Bend gas field

(20:30) The market for Boonsville gas & signing the Chicago contract

(25:00) US natural gas markets through the decades

(30:30) Mitchell Energy goes public

(33:15) The decline of gas reserves from Boonsville leads to Barnett experiments

(34:21) Shale geology versus conventional formations

(42:22) Mitchell Energy sued by landowners

(46:10) Bill Stevens, COO of Mitchell Energy, skeptical of the Barnett project

(47:09) Chevron’s Barnett project

(51:20) Nick Steinsberger stumbles into an insight & unlocks the code

(58:30) Mitchell Energy tries to sell itself, fails, then succeeds

(01:03:31) Lessons learned

References

The Frackers: The Outrageous Inside Story of The New Billionaire Wildcatters by Gregory Zuckerman (Link)

George P. Mitchell: Fracking, Sustainability, and an Unorthodox Quest to Save the Planet by Loren C. Steffy (Link)

A Retrospective Review of Shale Gas Development in the United States: What Led to the Boom? By Zhongmin Wang and Alan Krupnick, 2013 (Link)

Windfall: How the New Energy Abundance Upends Global Politics and Strengthens America’s Power by Meghan L. O’Sullivan (Link)

Elon Musk famously said that PayPal wasn’t a hard company to create. It was a hard company to keep alive.

In 1999, three future titans of technology—Max Levchin, Peter Thiel, and Elon Musk—charge straight into the blaze to bring payments and finance into the internet age. This is the story of how a handful of brilliant founders and their team navigate from crisis to crisis, face constant near-failure, and create the first successful internet payments solution. From the wreckage of the dot com bubble, they emerged refined—the founders, investors, and builders who would go on to shape the next two decades of Silicon Valley—and a lot of the world we live in today.

Chapters

(01:20) Mr. Buffett on the Stock Market

(02:17) The stock market in 1999

(05:21) Intro to Max and Peter

(09:49) Intro to Elon

(15:45) Why they choose to do startups this late in the cycle

(20:51) Insight of eBay as a perfect market for p2p payments

(22:51) Competition between Confinity and X

(26:55) Confinity and X merge

(34:09) Novel business model & technology innovation

(37:29) The stock market crash dynamics

(43:25) How PayPal navigates post-9/11 slump with an IPO

(48:42) The PayPal Mafia

(50:40) Nature vs. nurture

(54:02) Takeaways on market timing

(55:24) The internet delivered on its promise

References

The Founders: The Story of Paypal and the Entrepreneurs Who Shaped Silicon Valley by Jimmy Soni (Link)

The PayPal Wars: Battles with Ebay, the Media, the Mafia, and the Rest of Planet Earth by Eric M. Jackson (Link)

PayPal S-1 Filing in 2002 (Link)

Mr. Buffett on the Stock Market, Nov. 22nd 1999 (Link)

Jeff Bezos did just that. And while the Amazon story has been told many times, it’s fascinating to think about what he saw that gave him the confidence to leave his comfortable Wall Street job to start Amazon.

How did he see the wave before most people, and what gave him the conviction to go for it? We cover his key relationship with David Shaw, his market research, and his regret minimization framework.

Famously, Amazon focused on books and grew like a rocket ship. How did they navigate the hype cycle and the dot com mania? Was their approach to investing during the boom the right approach? What can we learn from how they navigated the crest at the height of the bubble?

Finally, we ask maybe the most important question of all—how did Amazon survive? What were the market conditions they had to navigate? Did they do anything specific to position themselves or did they just get lucky?

Chapters

(01:20) Increasing return games

(05:38) Jeff Bezos’s background

(10:27) Market backdrop in the late 1980s, early 1990s

(13:54) Jeff Bezos meets David Shaw

(16:47) How Jeff Bezos sees the wave and builds conviction

(32:22) How Amazon navigates the wave

(35:25) Joy Covey hired as CFO

(36:27) Amazon’s investment philosophy during the boom

(42:40) How Amazon survives the crash

(44:25) Amazon’s financings

(49:41) The market crash and Amazon’s reaction

(52:50) Why did Amazon survive?

(57:50) See the wave, ride the crest, survive the crash

References

The Everything Store: Jeff Bezos and the Age of Amazon by Brad Stone

Invent & Wander: The Collected Writings of Jeff Bezos

Amazon SEC filings & shareholder letters from 1996-2002

“Riding the Perilous Waters of Amazon.com” by Peter de Jonge, New York Times Magazine, published on March 14, 1999 (link)

Increasing Returns and the New World of Business by W. Brian Arthur (link)

2,300x web growth from ‘93-’94, John Quartermann, Matrix News, Vol. 4, No. 2 (link)

Acquired Episodes (History, Tom Alberg)

The existing telecommunications infrastructure was designed to carry voice and television signals—not data packets. The system needed billions of dollars in fiber and copper to support the tidal wave. Telecom entrepreneurs, incumbent executives and capital markets were eager to invest capital and ride the boom.

In this episode, we tell the parallel rise (and unraveling) of two giants who tried to wire the future from opposite ends of the network.

On one side: John Malone, the genius capital allocator behind TCI, stitching together last-mile cable systems and striking the blockbuster sale to AT&T in 1999 as the industry chased an “integrated provider” vision after the ’96 Telecom Act.

On the other: Bernie Ebbers of WorldCom, an acquisition machine that vaulted from discount long-distance reseller to national carrier—fueled by a once-accurate-later-obsolete statistic implying “internet traffic doubles every 100 days,” a meme born at UUNet and soon echoed by CEOs, analysts, and even the U.S. Commerce Department.

We follow the capex arms race, Williams’ ingenious move to pull fiber through abandoned pipelines, the strategic missteps at AT&T, and the line-cost KPIs that nudged WorldCom across the line from pressure to fraud.

Along the way, we draw out lessons for investors and operators that resonate in today’s AI boom.

Chapters

(01:15) The meme that sparked the boom

(04:00) Market structure for telecom in the 1990s

(10:01) Huge capital expenses

(11:16) Opportunity space for entrepreneurs

(12:59) Introducing Bernie Ebbers and John Malone

(18:02) The invention of EBITDA

(20:18) Everything changes in ‘95 and ‘96

(26:50) LDDS becomes WorldCom—a top long-distance carrier

(31:20) TCI becomes a top cable company

(35:14) Prices down in long-distance telephone & last-mile assets become very valuable

(37:24) TCI acquired by AT&T

(39:10) Contrasting dot com vs telecom financing

(43:23) AT&T-TCI merger challenges & WorldCom earnings down

(52:02) Aftermath for John Malone and Bernie Ebbers

(55:53) Lessons learned and applications to today

References

Cable Cowboy: John Malone and the Rise of the Modern Cable Business (link)

Born to Be Wired: Lessons from a Lifetime Transforming Television, Wiring America for the Internet, and Growing Formula One, Discovery, Sirius XM, and the Atlanta Braves by John Malone (link)

Extraordinary Circumstances: The Journey of a Corporate Whistleblower by Cynthia Cooper (link)

Boom and Bust in Telecommunications by the Federal Reserve Bank of Richmond (link)

Gold-rush energy meets browser wars.

In mid-1994 Silicon Graphics legend Jim Clark sits down with a 22-year-old programmer Marc Andreessen in the heart of Silicon Valley. Clark, a rebellious hardware icon trying to reinvent himself, and Andreessen, fresh off building the first web browser, bet that the browser will be the operating system to the open web.

Their new company races from zero to market share dominance, forcing Microsoft’s “tidal wave” pivot. They turn their IPO into a marketing weapon on August 5, 1995 when Netscape goes public without profits—and the stock soars—sending a blaring signal to founders, VCs, and retail investors that the internet era (and a historic boom) has begun.

Along the way, we unpack how Clark helped flip Silicon Valley’s power dynamics in favor of founders and engineers, and why Netscape’s triumph—and ultimate fate—should shape how we navigate today’s AI cycle.

Chapters

(00:18) Introduction

(01:13) The Tidal Wave Memo

(03:45) Microsoft’s Dominance in the 1990s

(06:40) The Origin Story of Netscape

(16:55) Who Was Jim Clark?

(18:34) The University of Utah as the Epicenter of Graphics Technology in the 1970s

(29:35) Jim Clark Changes the Game

(34:03) Netscape Shapes the Web

(36:31) Microsoft Responds

(38:20) The Mental Model of Dominating Operating Systems

(41:00) Why Was Netscape the Spark and Not Spyglass?

(42:17) Netscape’s IPO and the Macro Environment

(49:00) The Boom Starts

(50:25) Lessons from the Netscape Era

(52:24) Was Netscape Ultimately Successful?

References

The New New Thing by Michael Lewis (link)

Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages by Carlota Perez (link)

Marc Andreessen on Inventing The Internet Browser (link)

New name, same mission—to dive deep into the major turning points in market history and bring them to life with riveting storytelling and actionable lessons.

We talked to many of you to explore what worked well in our pilots and what we should tweak—format, structure, topics, and naming. Your feedback was invaluable and is always welcome.

Our stories will always be bigger than downturns and crises. We study full cycles—how booms build the foundation for the future, how busts clear away the speculative excesses, how institutions and individuals navigate the ups and downs, and how lessons from the past apply to the present.

So what’s next?

We want to build ways to dive deeper together—to go beyond the stories and dig into the details. We’re exploring memos, cases, and of course, a community feature so we can interact in real-time.

As we develop those, we are laser-focused on making our episodes excellent. That’s the bar, every day.

We’re going a little “Taylor’s Version” for the next two months to re-record our series on the Dot Com Boom and the Global Financial Crisis. It will be completely new content—from scratch—with a few surprising sideplots.

Stay tuned and spread the word.

2025 is not the first time the US has faced that question. And how it gets answered today will have implications for generations, just as it did last time.

In August 1971—with the dollar under the pressure from gold outflows and concerns about an economic slowdown—Nixon installed Arthur Burns as Fed Chairman and worked with Treasury Secretary John Connally to shut the gold window, apply price & wage freezes, and impose a 10% tariff on imports (listen to the series).

History doesn’t repeat itself, but it often rhymes.

Harvard economist Kenneth Rogoff makes the case in the latest edition of Foreign Affairs that, “with long-term interest rates up sharply, public debt nearing its post–World War II peak, foreign investors becoming more skittish, and politicians showing little appetite for reining in fresh borrowing, the possibility of a once-in-a-century U.S. debt crisis no longer seems far-fetched.” (Issue: Sept/Oct 2025)

How might this play out? Could the US attempt to unilaterally restructure the global monetary system again?

“Already, the Trump administration has hinted at more drastic actions to deal with mounting debt payments, should gaining control of the Fed not be enough. The so-called Mar-a-Lago Accord, a strategy put forward in November 2024 by Stephen Miran, now head of Trump’s Council of Economic Advisers [and one of the leading candidates to replace Jay Powell as Fed Chairman], suggests that the United States could selectively default on its payments to the foreign central banks and treasuries that hold trillions of U.S. dollars.” (Issue: Sept/Oct 2025)

The US doesn’t have to stop paying interest to default. It can simply print more dollars, thus inflating its currency to reduce the real value of its outstanding debt. This would be like paying my mortgage with the leaves I raked from my yard rather than the money in my bank account—as if money literally grew on trees. Of course, when the US does it, the effect is often to increase the price of goods and services across the economy.

If we want to prepare ourselves, our portfolios, our companies—we need to learn from history. We need to look back in time to understand how this played out in similar times.

How can we tell if we’re headed for a global monetary restructuring, or a major debt crisis?

How do money, assets, and people behave during one of these?

How would it affect geopolitics?

It’s hard to predict the future, and close to impossible to time markets. But it’s not hard to prepare—by studying history.

In the summer of 1971—with inflation rising, unemployment hovering near 6%, and foreign central banks suggesting they might convert dollars into gold—Connally, only months into the job, worked with Paul Volcker and others on a plan to fix the economy.

During an intense weekend at Camp David, Connally orchestrated consensus around a plan that included wage and price controls, a 10% universal tariff on imports, and most importantly, the suspension of dollar-gold conversion. These policies were sold as temporary and forced a global realignment.

At 8:00 p.m. ET on Sunday, August 15, 1971, Nixon announced the New Economic Policy to the world and kicked off a series of events that led to the monetary system we have today.

Chapters

(00:20) Connally’s 4 No’s Speech

(02:00) Gradualism & Stagflation

(04:26) Whispers of Global Monetary Crisis

(05:52) The Nixon Doctrine

(07:30) Introducing John Connally Jr.

(14:18) How Connally Gets on Nixon’s Radar

(15:47) Moving Away from Gradualism

(17:27) The Potential for a Run on the Dollar

(24:50) Camp David Economic Meetings Coordinated by Connally

(30:05) The British Allegedly Want to Redeem $3 Billion in Gold

(33:07) Policy Change Decisions at Camp David

(39:23) Nixon’s Speech Shutting Gold Window

(40:15) The Immediate Domestic Reaction of the Speech

(42:39) The Foreign Reaction to the Speech

(46:08) Smithsonian Agreement in December 1971

(47:56) By March of 1973 Bretton Woods Is Dead

(49:30) Why Did We Not Have Another Bretton Woods Agreement?

(52:10) Similarities and Differences to What’s Happening Today

References

Three Days at Camp David: How a Secret Meeting in 1971 Transformed the Global Economy by Jeffrey E. Garten (link)

Nixon's Economy: Booms, Busts, Dollars, and Votes by Allen J. Matusow (link)

https://wtfhappenedin1971.com/

After negotiating Fed independence as an Assistant Treasury Secretary with the 1951 Fed-Treasury Accord, President Truman appointed Martin as chairman of the Fed. For two decades, Martin fought to establish Fed independence while pursuing the long-term interests of the US—fighting inflation, defending the dollar, and facing off against five presidents.

While he navigated the demands of a booming economy at home, Martin coordinated with US allies to stabilize exchange rates and grow world trade—all while balancing the needs of Cold War military spending, allied foreign aid, and private capital outflows.

We trace the mounting pressure from the late 1950s gold spike through Vietnam-era deficits as Martin tries to hold the line with rate hikes, diplomacy, and sheer credibility among global central bankers. It’s the story of a principled broker navigating guns-and-butter politics while the world loses faith in dollar-gold convertibility—and according to his own assessment, he was almost successful too… almost.

Chapters

(00:47) Introduction

(03:33) William McChesney Martin Jr.

(09:14) The 1951 Fed-Treasury Accord

(12:42) Truman Appoints Martin as Fed Chairman

(13:34) Eisenhower Presidency Reinforces Fed Independence

(17:00) Comparing Growth & Productivity during This Period to Today

(18:41) Gold Drain and Military Spending

(22:51) Price of Gold Breaks $35/oz

(26:52) The JFK Years: More Military Spending & Tensions with France

(34:12) Bretton Woods and Inflation

(36:36) Central Bank Swap Lines

(41:05) Confrontation at LBJ’s Ranch

(44:53) The Circularity of Dollar Strength and Military Spending

(56:40) Bill Martin’s Legacy and State of the Fed as Nixon Takes Office

References

Chairman of the Fed: William McChesney Martin Jr. and the Creation of the Modern American Financial System by Robert P. Bremner

Gold, Dollars, and Power: The Politics of International Monetary Relations, 1958-1971 by Francis J. Gavin

https://wtfhappenedin1971.com/

In the first episode of the series, we tell the story of how an ambitious, little-known American technocrat—Harry Dexter White—went toe-to-toe with the world-famous John Maynard Keynes to rewrite the rules of global finance.

Bretton Woods wasn’t just a conference. It put the US dollar at the center of a new monetary order, backed by roughly two-thirds of the world’s gold and America’s unrivaled economic power after World War II. Delegates representing 44 nations agreed to fixed exchange rates, created the IMF and World Bank, and made the dollar “as good as gold.”

We trace how global leaders were traumatized by the economic chaos following World War I—trade wars, currency collapses, and the Great Depression. Against this backdrop, we explore how White moves from the periphery of academic economics to play a central role in FDR’s Treasury. From there he outmaneuvers John Maynard Keynes and secures American primacy, despite also moonlighting as a Soviet spy.

This episode covers the genesis of a system every president from Truman to Nixon would struggle to defend—and the traces of which still shape the world economy today.

Chapters:

(00:18) Introduction

(03:47) Background on Harry Dexter White

(6:29) Economic Backdrop Leading to Bretton Woods

(12:58) Barter Trade vs. Free Trade

(15:22) Background on John Maynard Keynes

(18:06) Keynes and White Meet in London

(20:02) Harry Dexter White, from Periphery to Center

(24:13) White Gets to Work on New Monetary System

(32:24) US Leverage over the UK

(37:32) The Build Up to Bretton Woods

(41:54) Harry Dexter White’s Triumph at Bretton Woods

(46:59) The Aftermath for White and Keynes

(48:01) Reflections on White’s Soviet Espionage

(55:16) Questions for Today’s Global Trade & Monetary System

References:

The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White, and the Making of a New World Order by Benn Steil

https://wtfhappenedin1971.com/