That. If you could sort of give us an update on where this case against you currently stands. Well, you probably know as much as i know. Let me just say this. I think earlier this last year i was on your program, and i said i had two goals. One was to provide my investors with the performance they want and deserve. And second, to prove definitively in a court of law these charges are totally without merit. And these frankly continue to be my goals. So for 2016, i think we delivered okay performance. I always i dont like to grade my own performance. I think thats up to my investors. But our credit fund was up a robust 16 for the year. Our equityonly fund up 10 for the year and diversified strategies up 8 . So an acceptable kind of year. Ive learned a lot about the process that im going through in the past year. And and i want to make it clear, i have great confidence in the judicial system. Im anxious, very anxious to get into a courtroom for a judge to understand the facts. Having said that, frankly, i was truly surprised at the destructive power the s. E. C. Has. They have done substantial damage to my business, and i think in the end for no reason. Two years ago, lawyers have looked very, very carefully in great detail at our trading and say they know inside trading is no inside trading here. I know the facts of this case like i know the back of my hand and there is nothing wrong that has been done. In the meantime, its going to cost probably 100 million to deal with this. And when its all over, you know, im not going to get anything other than satisfaction. Because the u. K. Is losing party pays, not in the united states. I pay my own expenses. Number two, the government has sovereign immunity, so i cant sue the government for wrongful litigation. And the taxpayers pay the bill of the u. S. Government the cost. So its a difficult situation. Again, i want to emphasize, i have great confidence in the judicial system. This will be heard by a judge, possibly a jury, and im completely confident that in the end were going to win. But its up to the judge and jury to determine the outcome. And im here ready to cooperate and present a case. I did say parenthetically, i found a very interesting process. I have in my fund and im not complaining. Im very philosophical. Im a big boy. Im not a cry baby. In my fund, i have a half dozen icons of american business. People that didnt make America Great again. Made America Great to begin with. People that ran fortune 25 companies, either founded them or built them or ran them. And every one of them every one of them to a person said we know who you are. We have great confidence in you. We know what the system is all about. Youre doing the right thing for yourself and for your investors. Hang in. And defend yourself. And not one with drew from the fund. On the other hand, you are dealing with a bunch of institutions that use fiduciaries and they clearly dont believe in the american system of jurisprudence that youre innocent until proven guilty. I had a tremendous number of withdrawals, people that didnt even pick up the phone to call our lawyers who said repeatedly to us, there is no inside trading here. Anyway, it is what it is. The firm has shrunk in size. Were here to do business. And the thing im most depressed about, in all honesty, is the cost, because of where this money could be going. You probably know this, but youve asked me about it in the past. I took the giving pledge with warren buffett. I told warren when i met with him, if youre talking to people of great wealth, asking for half isnt asking for enough. I intend to give away all of my wealth back to society. Ive given my kids their inheritan inheritance, and basically, my signature event is i have a program called the cooperman college scholars. And i have a plan to send 500 kids to college. Its lifechanging experience to pay their tuition. The average lifetime earnings of a College Graduate is in excess of 1 million greater than a nonCollege Graduate, plus your equipment in the future, giving them a skill set that they otherwise dont have. And i know what my commitment to that program was for 500 kids. And given what this is costing me, i could take that to 2,500 kids. And it just seems such a waste of money. It is what it is. Again, i want to emphasize, i have confidence in the judicial system, and this will have to be heard. I dont control the timetable. As far as im concerned, love to be a trial yesterday. So you dont have a trial date yet. No, this is up to the judge. We have i believe im getting a lesson here. Im told in florida, where i reside, that they have whats called rocket docket treatment. Where you can ask for accelerated treatment. This is a philadelphia judicial system and they dont have provision for rocket docket. So we have asked the judge for expedited treatment, and well have to wait and see. Again, you know, it is what it is. And im optimistic in the end that right makes might. But well see. We have to wait and see. Do you think if youre cleared of these charges that your business will eventually recover . Well, its a Good Business now. We have 3. 4 billion. About 60 is client is our money. 40 is client money. Its enough of an opportunity to earn money. Lets face it, size is an anchor to performance. Certain benefits to being smaller. I would have rather have gotten smaller in a different way than ive gotten smaller. Im 73. Im giving my money away to society. I work hard enough. I just want to grow through appreciation and performance. Im not looking to a marketing game, raising a lot of money. I just want to feel good about myself, deliver the performance my investors deserve and add luster to my reputation and return the luster thats been kind of tarnished by this suit which i think is ill founded. Again, its up to a judge. You mentioned some of the bigname investors who have stayed with you. And i know you dont want to mention any of those names specifically. Have any of them or any of the institutions for that matter who are still with you, urged you to settle . Uh im trying to think. Theres so many different opinions about this. One guy that i have enormous respect for i just love the guy. Im heterosexual, but i say hes a man. Is can langhosn. He said ive known you for over 40 years, i know what you stabbed for, i know what youre all about. I can only tell you the best 30 million i spent, deferreding myself against eliot spitzer. If you have done nothing wrong, dont give money to defend yourself. About three months letter, ive been in a Board Meeting and a gentleman comes over to me, very wellintentioned and said i want to tell you the worst three years in my life was when i had a s. E. C. Problem in the late 80s, do whatever they want and get rid of them. And i said interesting theory. Im kind of in kens camp. It is what it is. Its inappropriate for me ken gave me the permission to use his name. Others i dont feel are appropriate. These are people that started, founded and were built fortune 25 companies. That understand the system, understand the game. And im disappointed that the institution something which i had a relationship for 50 years pulled out without even calling an attorney. I mean, you know, if my attorneys felt there was something wrong done, they would have advised me to settle. But, you know, they said, we know inside trading. There is no inside trading here. So well have to wait and see. It is what it is. Lets talk about the markets then. I have a few guys in front of me here on the set. Pete najarian along with joe terranova. Those guys are smarter than me. They ought to tell you when they think. Not a chance. We have all watched what the markets have done since election night, really in mazement. Im sort of wondering what your own thoughts are about where stocks have gone since november the 8th, and where you think they can go from here. Yeah, well, i would say, look, stock prices are or price earnings ratios are a function of a companys growth rate, a function of Interest Rates, and a function of confidence. And clearly, the major change since the election is confidence has entered the system, you know my great friend, early on in the business, when he joined the business, used to write about octogenarian plays. Ceos that werent well thought of, and when they pass away the stocks would rally. This is a real indictment to the prior administration. This great optimism, the feeling was previous regulators had their foot on the throat of the economy and the economy was indicating. And well have to basically wait and see. I myself am much more restrained in my optimism. Im looking at 2017 as a year where we continue to move towards normalization. As the Business Cycle ends ages. What i mean by normalization, i think Interest Rates are going to go up. Inflation is going to go up. Corporate profits are going to go up. And price earnings ratios are likely to decline. And my most optimistic scenario would be Something Like a 17 multiple on 140 in s p earnings, and that number i think is 23. 80. And were 22. 50 or 60. So 5 upside, 2 dividend, 7 , Something Like that. And things can go wrong. So i find myself, you know, very comfortable with the stocks i own, which we think are value, but on the overall market, i fairly neutral to mildly positive. Not ebb land. Maybe Jeremy Seigel will be ebb lent. But im mildly positive. If the trump agenda actually gets passed in the magnitude at which the market has risen in expectation, could you then get a greater lift to corporate earnings and multiple expansion, thus taking the market higher than you expect . Yeah. Well, thats what the market is basically the market is forward discounting the expectation of repatriation of foreign earnings, the reduced Corporate Tax rate. I mean, those two things alone could add about 10 to s p earnings. So assuming Nothing Happened in 2017, the s p earnings would be about 130. If we got repatriation, and we got a tax rate down to the low 20s, you could see earnings of 140. And then the question becomes, what is the proper multiple. And, you know, i kind of feel 17 times earnings is a reasonable number. You know, theres lots of things we have to be concerned about. I dont want to talk out two sides of my mouth. What i hear coming out of Donald Trumps mouth is very similar to what we heard from president reagan. President reagan ran a platform and said i want to restore the lost prestige of the united states, and do that through rebuilding our defense capability. Im going to get the government off the backs of the people by balancing the budget. President reagan figured out relatively quickly you couldnt do all three. And hes implicitly said the hell with the budget, were going to do the first two, and we basically bankrupted the soviet union as we rebuilt that defense capability. And its not clear that we could accomplish all these things. We have to watch very, very carefully. There is no question, confidence has entered the system. When the market goes up, youre too conservative, if it goes down, youre not bearish enough. A man i have enormous respect for i was on your program january of last year. And that was early february. Thats when the market got clocked. It was down 10 . And i think bottomed at 18. 10. And i said on the program i thought the market ought to support a 15 multiple, 15 to 17 multiple range. And this guy who so much smarter than me, the life of a human being, very generous. Im not going to give his name. Its not my position, but sends me an email, saying your multiple is too high. And i responded this is a guy i have enormous respect for. I want, what have you got in mind. And his response was 13 times. He says that we have artificial monetary policy. I mean, i happen to agree with that latter part. I dont understand why Interest Rates are where they are. And let me just say this. If Interest Rates a year from now are 240 on the tenyear government and fed fund is 50 basis point, you dont make double digits returns in the stock market. Simple as that. You dont make double digits returns. A normal environment to me the tenyear Government Bond ought to track nominal gdp. If the fed wants 2 inflation and lets say we have 2 to 3 real gdp under trump, lets say three, thats 5 . The tenyear government doesnt belong at 2. 5 or 2. 4. Its there mainly because of the feds policy and the short end of the curve, which is, you know, very much tied to whats going on with the Dollar Exchange rate. Very worried about an excessively strong dollar could create a problem in the economy. You would certainly give you would certainly give pardon me for my interruption. You would certainly give a lot back of this socalled reflation trade, which certainly appears to be alive and well in expectation of what trump is going to deliver. If Interest Rates dont go anywhere. Well, you know, i Interest Rates are expected to go up and the market accepts that. The stock market is undervalued relative to current Interest Rates. The stock market incorporates higher Interest Rates. As long as we get Economic Growth in the slope of the rise is gradual, the market can handle it. You know, again, i know i sound like a statsician, its been 15 times and when the market multiple is 15 times, basically tenyear government was about 6. 6 , and Treasury Bill rate 5 . I think its treasury is 30, 40, 50 basis points and the tenyear government 2. 4 . So the market is allowing for higher Interest Rates or slower future Economic Growth. But i think that a lot of president elect trumps program will get enacted. A bipartisan support. And we hopefully get the country going again. Im all for that. You know . I mean, i love my country. I tend to be more longoriented in my investment program. And i my investors do better and i do better when the country is prospering. Im just wondering democrat or republican. If you think we have borrowed from 2017 in this run that we have had to end 2016 and if you thought stocks were fairly or fully valued the last time you were on, given whats happened in the stock market, whether you just say theyre too expensive where they are right now. I would say theyre fully valued. Dont forget, you know, i was on a year ago, the trend line returned is about 6 in equities. So the market deserves to be 6 higher a year later, right . So were now looking one year out. But no question about it. I think the stock market is reasonably fully valued. Again, i as you know, i love only wish i coined the phrase, ji, John Templeton did. Bull markets mature on optimism and die in euphoria. And i would say if the market continued in the next month or two, like its been the last two or three months, you would be for euphoria and i would be forced to become bearish. Interesting. You really have heard the words, animal spirits, and euphoria being used more now than perhaps they have been in the last many, many years. Theres no question that people are more optimistic. But i dont think prices are euphoric. You know . Prices arent euphoric. You know, i have a list of stocks i know well talk about later that are trading at, you know, low double digit multiples, high single digit multiples, Good Businesses. There is plenty of value in the market. I would say if the s p continued very strong here, it would resemble euphoria. And that would be a warning sign. But we will have to wait and see. I dont think were euphoric at the present time. But we have we have pulled ahead. We have pulled ahead of some future returns. Yeah, and thats sort of thats one effort points. Ill let you get your earpiece back in. That was one of the points i was making. I think people are wondering, just given the magnitude of this trump rally, as were calling it, have you undoubtedly borrowed from 2017, at least a bit . How about judging me by the numbers. 22. 50. You tell me. Making 4 or 5 in the next 11, 12 months enough or not enough . Its enough because of the craziness in the fixed income markets. But, you know, youve got to be careful. You dont want to discount an equity stream of earnings by something that is bubble like in its pricing. We just had a record level of car sales, over 18 million seasonally dressed annual rate and the fed is 50 basis points . I would have never thought that situation would exist. Rates should be higher. So people dont know what to do with money. Right. Im just like everybody else. I put my pants on one leg at a time and ive got to take my savings and decide what i want to do with it. And i dont want to buy a tenyear government at 240. I dont want to sit in cash earning 40 basis points. And i want to buy my face to facit equity and keep a certain county of liquidity if this doesnt all work. You have given me a good segue into getting to the first stock pick of the day. Because when you mention people are spending their money, they certainly seem to be on automobiles and in other parts of the economy. But they certainly do not seem to be spending their money in the Nations Department stores, which are suffering greatly, even today is a perfect example, given what the stocks at macys and kors are doing. Pvh, however, is a different story. Today they say they will beat the top be at the top of their guidance range. The stock is reacting differently than some of these other retailers, and, in fact, it is one of your top picks. Do you want to tell us why . Yeah, valuation. And my case, you know, i have eight analysts that work with me and theyre so much sharper about the fundamentals of the individual companies. I defer to them. But understand my mindset. When i look at the s p 500, its 500 Companies Growing somewhere between 5 and 6 per annum. They yield about 2 . Have about 35 debt to capital in their capital structure. And they sell a little bit on the three times book value. For those financial statistics, youre paying Something Like 17 times earnings. So my game at omega is to look for more growth, more yield, more underlying asset value at a lower valuation. So pvh is a very fine company. By the way, i might add, macy pointed out their mens wear was doing very