Name: Mariner Investment Webcast: Navigating the Crosscurrents — Conflict, Innovation, and the 2026 Midterms
Uploaded: 2026-07-16T14:56:38.990Z
Duration: 36 min 52 s
Description: Mariner Investment Webcast: Navigating the Crosscurrents — Conflict, Innovation, and the 2026 Midterms

Transcript for "Mariner Investment Webcast: Navigating the Crosscurrents — Conflict, Innovation, and the 2026 Midterms": Morning, everyone. Welcome to the Mariner midyear webcast. My name is E. G. Fisher. I'm the CIO of Mariner Investment Group. Just as way of background, Mariner Investment Group is a $10,000,000,000 alternative investment manager. We have 27 teams trading, in, fixed income space, all relative value, 13 credit teams, five mortgage teams, and nine rates teams. I'm joined by three PMs, part of our credit teams, Mike Lipsky, who runs the Bowport event driven stressed and distressed, credit effort, Eelco Rooimans, who runs our convertible bond arbitrage business, and Bob Neighoff from Cicero team who manages CMBS and CRE investments for us. I'm gonna talk about a few of the events that have been occurring, so far this year. Obviously, probably number one on the list are the wars, the Ukraine war and the Iranian war, and how they're impacting a number of pieces of the puzzle for us. Number one, obviously, commodity prices, the price of oil, and how that has impacted not just inflation rates, around the globe, but also supply routes. Number two, defense spending, and infrastructure spending. Obviously, Germany, a massive increase in spending. The United States, so far, increase in spending. What does that mean for our markets, not just in terms of Fed policy, but also issuance? And then number three, global trade groups and how that's impacted the marketplace. Three three very, very important topics, so far this year and will continue to be for the second half of the year. I think the second topic that we'll talk about is innovation and technology. It's impacting the markets dramatically, right from the highest level, in terms of central bank policy, the Fed, Bank of Canada, ECB, Bank of England. Impossible for them to ignore what's happening around the world with technology as well as the wars and how that's going to impact inflation going forward, and what they'll have to do, to deal with that. Technology as it impacts the markets that we trade in, actually, in mortgage space, for instance, the shape of the s curve or how efficient the prepayment option is, being impacted by technology. And then lastly, in credit, and you'll hear a lot of this from the gentleman on my right, but how technology is impacting the credit space, which we all know has been massive so far, year to date. The last piece of the puzzle, the midterm elections right around the corner. I know with everything going on now in the world, it seems as though they're they're off in the distance, but they're really not. Obviously, too close to call what's gonna happen in The US in terms of the senate, but I think we can all agree that, there's potential for quite a bit of volatility as to what might come out of the administration in the next five months before the elections, and how that might impact not just supply in the marketplace, but volatility in the marketplace. So midterm elections looming, closer every day. Two big picture factors that I really wanna talk about today on top of those that are impacting all the markets that we trade in, are liquidity and technology. Liquidity and technology impacting mortgages, rates, credit, in many different ways. I'm gonna focus on both of them in each one of those three spaces. We'll start with rates. In the rate space, when we talk about liquidity, we are mostly talking about the Fed and how the Fed provides liquidity into the system for the pipes and the plumbing of, fixed income markets. We all know that last, fall in October, the Fed allowed bank reserves to fall too low, which caused funding stress in the marketplace. We actually had multiple days where the funding rate traded over the standing repo facility, supposedly a hard ceiling on that rate. And then the Fed reacted by increasing supplies by $40,000,000,000, a month. They recently, six weeks ago, changed that to 10,000,000,000 a month, and their goal is to find the ample level of reserves. It's not an easy goal. They've made a mistake in 2019, which we all know about. They made a mistake last fall, and they're trying not to again. It's a very, very, very important topic. On top of that, we have a new Fed chair, Kevin Warsh. He's got very different views on how the Fed should react, and the Fed policy, how it should be carried out than the previous Fed chairs. He doesn't like forward guidance. He thinks the market should help inform people about what Fed policy will be, not be reactive to Fed policy. He doesn't like the dot plots. He thinks that they're, projection and and not helpful. He doesn't like a big Fed balance sheet, and wants to shrink it in many different ways. This is critical because this gets to our question about liquidity and how that's going to impact all the markets, in the next six months and and beyond. The Fed shrinking its balance sheet, not an easy task, certainly creating more stress in the marketplace. In a market where we've already seen just a few weeks ago for the quarter end, funding rates in the equity space, very difficult, very elevated. We saw equity TRS trading over a 140 basis points higher than SOFR to get over, the turn, June 30, to fund your equity position. So a shrinking Fed balance sheet, decreasing bank reserves, on top of the current positioning that we have, a very difficult spot for the Fed to be in, and a very difficult spot for the markets to navigate in the next six months. This will be a very important topic for the rates, environment that, we're trying to trade in, as well as mortgages and credit, which we'll talk about in in a minute. Technology, the second topic. I wanna talk about technology in rates. How does technology impact rates? It's really through the Fed function as well. And when we talk about tech and we talk about AI, we're talking about how that's going to impact the labor markets and inflation. And there's two sides to both of those coins. Obviously, AI, generating a huge amount of discussion about job displacement, the younger cohort coming out of college finding it difficult to get jobs. Is it because of AI? The data actually suggests now that as AI is being rolled out and as companies implement, AI into their infrastructure, there are more jobs being created. Right? So an increase in the current workforce due to AI. There will be a tipping point, and this is one of Warsh's main points, where AI will create productivity and that will cause some job losses. The question is where does that happen? Where are we on that curve? And that's critical for the Fed. The second piece of the puzzle, inflation, and how is AI and technology impacting inflation. Again, the general thought is that AI will be deflationary as most technologies are. But what we've seen to date in the last two or so years as AI has been rolled out is actually increases in inflation, and you're gonna hear about some of that in in the corporate space. Rolling out AI chip costs massively increased. We know Apple's raised prices on its products. We know a lot of commodities prices have increased because of the demand for AI. Electricity and demand for electricity has gone up. All these things have been inflationary, not deflationary. So, again, there'll be a point where we flip over on this curve and the potential productivity gains creates deflation or at least disinflation, but we're not there yet. And when are we gonna be there? Very big question and a very big question for the Fed. So technology liquidity impacting Fed policy impacting rates curves. How do we take advantage of that in the second half of the year? We have, numerous rates teams that trade treasury futures basis, trade coupon arbitrage, trade curve arbitrage, cross country arbitrage, inflation arbitrage, trying to take advantage of of all of these dynamics that are changing constantly. But in the world we're living in today, probably even more uncertain than normal, a long and a short on both sides of the trade to try and take advantage of some of this uncertainty in the rate space. I'd like to talk about mortgages for a minute now and mortgage related product. So the same two themes, technology and liquidity in the mortgage space. We'll we'll start with technology. Fifteen, twenty years ago, if you wanted to refi your mortgage, you had call your mortgage banker, set up an appointment, go down to the bank, might take two, three weeks, fill out all the documentation. If mortgage rates moved quickly back, you just missed your opportunity. Obviously, today, that's not the case. With technology the way it is, everybody with a smartphone in their hand all the time, the s curve or how efficient prepayment options are being exercised is dramatically steeper. Given any rate structure, the ability for people to take advantage of of a change in rates is dramatically increased over the last even five years, let alone ten or fifteen years. That has changed prepayment behavior by mortgage holders in this country dramatically. This technology, which always moves forward, obviously, will continue to do so and change that prepayment curve. This is the main focus of agency mortgage traders. Right? What are prepayments going to be, and how is that rate environment going to impact prepayments? It's a critical piece of the puzzle, and technology has changed that dramatically. When we talk about liquidity, we can talk about liquidity and even more so than in the agency space, how liquidity has impacted the non agency mortgage space. As an example, asset backed securities and issuance by hyperscalers in the asset backed space, has been dramatic this year. We're already 50% higher than we were last year on pace to dwarf last year's, issuance in asset backs. You're gonna hear a lot about issuance in the corporate space in a minute, but it's true in this space as well. And it's true, in terms of trying to use that flow and that issuance to find the best structures to be a part of. So we have numerous mortgage teams and agency and non agency trading product, CRT, ABS, RTL. The second half of the year, volatility in rates, volatility in mortgage prepayments, especially as technology increases the efficiency of that option, and massive issuance will create more opportunity in the mortgage space. Opportunity to find better collateral, low loan balance collateral, better prepay, better convexity collateral in the agency space, and better deal structures in the non agency space. That's how we have a long and a short in the mortgage space and take advantage of opportunity there. Last, like to speak about credit, and I'll get these three gentlemen involved in a second. But the credit space and what has happened in credit where liquidity and technology has probably had the biggest impact actually of the three areas that we trade in. Let's talk about liquidity first and credit. So everybody knows that liquidity has provided to investors in terms of cash flows, distributions coming from private credit, private equity has diminished over the last group of years. There just aren't the payments being made and distributions being made to support pensions, endowments, the expectations that they had when they made these illiquid investments years ago in a low rate environment. We live in a different world now. Inflation is not, it's constantly trending down. The world from the late seventies to 2018 or '19, is in the past. The Fed, the central banks are dealing with a a very different environment with consistent inflation pressure with higher rates for longer, which we'll talk about more, and that is impacting the ability of, private funds to make distributions. The other side of liquidity coin when it comes to credit is issuance. Huge story this year. Probably the biggest story of the year is the massive issuance by hyperscalers. We've already seen a $195,000,000,000 worth of issuance in the hyperscaler and IG market. That's double last year's pace. This is an incredible sea change in credit space and fixed income markets and one that we're probably in the second or third inning of. It's it's nowhere near over. This has dramatically changed the liquidity profile, not just in credit, but in all fixed income markets and even in equity markets, partially driving that demand for equity funding that we saw over the quarter end. We don't expect that to change anytime soon. That liquidity, drain that we've seen from a lack of distributions as well as massive issuance while the Fed is trying to change its balance sheet and bank reserves has led to massive dispersion underlying names in credit indices in the credit space. You see it on the chart here. CDX as an index has moved 69 basis points since the beginning of 2025, and yet the constituents in that index have moved over 300. And as you can see, that volatility has increased as we've moved along in time here to today. You see it in the equity space where underlying vol as a as a percentage of index vol is at an all time high, and we see it in the credit space. What does that mean for us? We're long and we're short. We want a name to be cheap and a name to be rich. And when you have that volatility and some names are richening and some are cheapening or credit sectors are richening and some are cheapening, we try and take advantage of that. That's the environment that we strive for. So it doesn't really matter if IG index is at 51 or 61, but when you have this dispersion, we take advantage of that, and that's the world that we live in. So we've talked a lot about rates, technology, liquidity, rates being higher, liquidity being drained, technology changing the world. I wanna take a minute and and get my colleagues into the conversation. Mike, technology liquidity impacting the event driven stress and distress space? I'm sure it is. Yeah. E. G. Thanks. I'll I'll I'll lead with the conclusion. Financial technology innovation that was designed to manufacture yield in a decade of low interest rates is not aging well in a, rising rate environment. You you're familiar with these nesting dolls where it's like a wooden doll. You open it up, there's another one inside, and you open that one up, and there's another one inside of it. That image is the first thing that popped into my head when I started reading through the quarterly filings for the business development companies, the BDCs. You know, the evolution of finance was bonds, then loans, then CLOs, then private credit. But now we're on to private credit BDCs and private credit CLOs, and they're taking advantage of a regulatory framework where they don't pay taxes at the corp, at the, at the holding company, and they're able to lever the entity two to one. So there's $2 of debt for every dollar of equity in the structure, and not surprisingly, they didn't stop there. When I look through the filings, there are CLOs issued inside the BDC. There are special purpose vehicles that have their own discreet pool of loans with their own debt structure inside of the BDC. So on this chart, you see the investments of the of the BDC at 2,300,000,000. And the operating would assumption might be, well, low LTV loans to middle market companies. How bad could it be? Maybe 85¢. But in reality, it's the equity of some highly levered structures that could go to zero. So I think the assumption of 85 is, is flawed. So hence the, the nesting doll analogy where it is, and really it's a metaphor for the modern BDC, which is a leverage structure with other leverage structures inside of it. Right. Not surprisingly, this financial technology innovation of BDCs and private credit, this didn't happen in a vacuum. It's left an indelible mark on how we restructure these debts when they go bad. You know, just for some history, in the eighties, we got the modern bankruptcy code. And then in the late eighties, a lawyer invented the prepackaged chapter 11 where we all would agree on a restructuring among the lenders and then put the company into court. Fast forward to today, there are liability management exercises known as LMEs where we don't even go into court. We just all the lenders agree on a deal, and we consummate it outside of a court. Not surprisingly, without adult supervision, in this case from a federal judge, lenders started ganging up on other lenders Right. Seeking a disproportionate recovery. And you've heard these terms up tier and drop down. That's just code for taking value from existing lenders and making it available to new money lenders. So it's ironic because when you look at this chart, nobody's getting a better recovery. There's lower everywhere. It's a secular decline in recovery rates. To put a finer point on it, for the non pro rata liability management exercises that have been done, 76% of them are in some sort of a restructuring process within one year. So this secular decline in recovery for secured creditors is, is an ongoing, phenomenon. That begs the question. For Mariner, how are we investing in credit in an environment where secured creditors have a secularly declining recovery? Well, for starters, as you mentioned, we're long and short. And so when you look at this chart, we like real world engineering, and we don't like financial engineering. We feel like financial engineering was an affect of a low rates environment whose time has come. So the left side of this chart is informed by the same views that inform us on private credit, CLOs, and BDCs. The long side of this is exposure to what is the greatest capital build out in our lifetimes. And you talked a lot about it, which is the CapEx for data centers. I can't tell you whether the NVIDIA GPU or the Google TPU will be the chip of choice, but I'm confident that there's gonna be a tremendous amount of fiber optic cable used to connect up Right. These systems. And we need, engineers, electricians, pipe fitters, and a tremendous amount of power equipment. Just to, for context, between now and 2029, we need 320,000 welders. We train 40,000 welders each year, which means that the number of welders we need to complete this build out are currently in the eighth grade. That feels pretty inflationary. Yes. So it took thirteen years to build out the Internet. This is just getting started four years in. Will there be winners and losers? Of course. Will the theme ebb and flow? Of course, it will. But by reading the documents, I think we keep ourselves out of trouble, and I think that's you know, given that secular decline in recovery rates, that's the name of the game. Recovery rates, deep credit, staying out of trouble, things that Ilco deals with constantly in the convert bond land? Indeed. Indeed. Staying out of trouble is is paramount, and, you know, defense and investment management comes first. If the investment thesis is right, the returns will follow automatically. And first and foremost, we we are risk managers, return managers. Secondly, there's this famous saying, don't judge a book by its cover. That's exactly where often investors find themselves, you know, in our convert space, you know, where we, are living in between the world of equity and the world of fixed income, people don't know exactly how to value a convertible bond, how to look at a convertible bond because it's got so many angles to it. Credit piece of that puzzle. Exactly. And and, you know, if they look at that plain book saying high yield, non rated, the assumptions kick in automatically. They see higher spreads. They see lower analyst coverage. They see smaller companies. And back on the shelf, the book goes. Whereas we, what we do, we open up the book, and we sometimes find a very healthy balance sheet, excellent management, low leverage, improving financials, low refinancing risk, I. E. All the all the aspects that a company with investment rate ratings exhibit. And that's where we find the beauty in these books, in these opportunities. So the risk is not about is the risk is not the credit. The risk is not doing the credit work. The deep credit work rigorously and vigorously looking at each convertible bond and value it on its own merit. That getting the treasure in the bond. Exactly. Exactly. And that's why we are so excited about the broader space, the broader convertible bond space and the opportunity sets that it provides. And that opportunity set, the pond that we're fishing in is growing by the day. I mean, if you look at the slide on the left, there, you see new issue, new CB issues, you see sector diversification, issuer quality, long only CB fund demand, daily trading volumes. They're all trending upwards. And this is not just one tailwind. It's it's it's an amalgamation of tailwinds that is helping our space, you know, becoming, maturing, and and establishing itself as a a liquid asset class that, we truly believe is is here to stay. And to put some numbers on that, we went on mid July. And, if you look at the right hand side on on the, on the slide, you see that, per today, we are topping 140,000,000,000 in new issuance. The CB asset space is now piercing the 700,000,000,000 mark, which is an all time record. Most stunningly, the average daily volumes in converts are around 5,000,000,000 on a daily basis. And, you know, for context, that is half of what is trading on a daily basis in in US high yield bonds. And that's incredible. And ten years ago, it was a fraction. It it was indeed a fraction of that. But that that, makes us conclude that that this space is here to stay. It's it's a wonderful opportunity set out there, and mature, liquid. Awesome. So that's impressive. A market that is, renaissance, if you will, and and building, growing. Bob, your space, CMBS commercial real estate, probably still coming out of a recession or recovery from COVID and then Silicon Valley Bank and the regional bank crisis. Right? A different story. Certainly relate to these guys here as they see kind of opportunities coming while in commercial real estate. You know, we feel like we've been in a recession for, you know, actually going back to COVID. I mean, if you think about it, like, you know, commercial real estate has been hitting, like, multiple waves. It started with COVID where all of a sudden, occupancy at your property, you know, wasn't a given. That led into the Fed, height ranking schedule where, you know, cap rates reset overnight, resetting every asset class, effectively overnight, throwing financing in the terminal, like like you pointed out, like, sub couple banks failed and, people were pointing to their real estate loans as being being their issue. The next wave that hit before even that one ended was, you know, tariffs and inflation. And inflation hits the commercial real estate, investor, borrower, you know, in their expense column. Right? They they higher insurance rates, higher labor, higher cost of materials. Right? So you, you you want lower expenses to offset, like, higher cap rates. That was supposed to happen. It didn't happen. So, you know, what this led to and, you know, if you when you kind of step away and take a look at the whole picture and you look at defaults in, on CMBS loans going back to the GFC, Right? They peaked around 10%, and then they kinda came back, right, and peaked again in 2020 of COVID at right around ten percent again. Came down as we started kinda going back to work and back to, the new normal. And now we've kind of, like, you know, ended up at a pretty lofty seven and a half percent, seven point five five percent here on default. And it stayed it stayed level here. So we're we're we're turning the corner. We're starting to get into this recovery, but you still have this really high elevated, delinquency rate, you know, here in in the loans. Now here's where it, you know, it kind of, differentiates itself. This is not like the GFC again even with all of these, you know, high default rates. The thing that happened is, you know, in the GFC, we saw, you know, we have this national price index that tracks prices going back over the same time frame that we track the delinquencies on. And, you know, you saw that the the peak to trough of valuations on commercial real estate dropped 35%, right, on all property types. Fast forward to the stresses that I pointed out here, these multiple waves, and we're only down 10.4% peak to trough. Well And we're not even down in the last three years. And we're not even down. We're yeah. That's correct. We're we're kind of, like, we're we're kinda stabilized here. We're kinda muddling along here. And, you know, how you have to think about that is, you know, is, you know, you know, the LTV of a loan. Right? The GFC, they definitely pushed LTVs, but, you know, say up to, you know, 20%, 30% even. And so you're down 35%. You're impacting the loan balance. Right? So that's where you see a loan level loss. But in in in what's going on at 10% peak to trough, you're you're not seeing that much on average. Now, obviously, like, you know, office is, a big contributor to that. Right? I can say seven and a half percent delinquency rate, but office is 12 and a half percent. And being the largest property sector, it heavily outweighs that number higher. So, you know, the market is improved on other property sectors or it has remained, like, steady on other property sectors. But, you know, that's really what is kind of like the CRE picture. So what does that mean for CMBS? Because we invest in in CMBS. Well, in CMBS, if you have lower, losses on the loan level, you know, you're gonna see lower losses in the individual CMBS deals. And once again, we use the same chart, same timeline, look at the the losses of CMBS deals during COVID. Well, they went from, you know, 10% for the 2007 vintage and 16% for the 2008 vintage. And but here we are now. We have, you know, you know, about fourteen, fifteen vintages since the GFC going back to 2011 through 2025. We're barely cracking 2% on the worst performing deals, losses in their CMBS deals. I mean, those will continue to go up, but we're we're nowhere close to, and I think that's where, you know, people get things wrong. They they hear about the high delinquency rate and the the, you know, the the negative stories, but that's not the case in the underlying that the data is showing. High delinquencies from fifteen years ago are not the same as today. That's correct. Structures are just much better. Yep. Right? That's correct. Yeah. But much better underwriting done by two point o. Right. So thank you guys. So, we've talked about liquidity. We've talked about technology, how it's impacted the markets, in the rate space, obviously, talking about the Fed and central bank activity, what they're gonna do with inflation, what they're gonna do with their balance sheet, treasury coupon issuance, which is most likely gonna go up in, November of this year, at least make an announcement about that in November. So liquidity, a big impact in the rate space. The mortgage space, technology and liquidity, driving many of the opportunities there. Technology is something that I think everybody knows about and uses on their phone, but how it's actually impacting prepayment rates, changes, it seems, every day, if not every week, month, or quarter. And then in credit, the dispersion that we see underlying, underneath the surface, creating opportunity in in your markets as well as as as the other credit managers that we have here, nine other teams that trade in the space, that trade one issue versus another, that trade credit curves, trade sectors versus each other, trade in in many of the different areas that, this dispersion creates opportunity in. This environment, uncertainty, Fed policy changes, dispersion, built for long short, RV trading. Everyone agree with that? Yes. I think so. Alright. Great. Let me get to some questions. So, I speak with a lot of investors. I I get quite a few questions. I wanna, ask you guys effectively a few of these, most important questions. We'll start with Mike. So if we are living in a higher inflationary environment and rates are gonna stay higher for longer, the financial engineering side of the equation that you speak of, how does how does higher rates for longer impact that piece of the puzzle for you? Sure. Three things that I would say. If a private credit borrower, for example, is paying SOFR plus 500 and SOFR goes higher, that should be a good thing. It should be good for the manager. It's more money coming up from the portfolio investment. The problem is is that a substantial number of private credit borrowers couldn't afford the old Sofer Plus 5 100. So they've elected to pay in kind, also known as pick. The second thing I would say is, the cost of funds for the private credit manager or the BDC is gonna go higher. And so the arbitrage between where they can borrow and where they can lend that money, that compresses, and it hurts their, yield. And then thirdly, these these, BDCs were marketed. The equities were marketed to retail investors as a high yielding instrument. Right. And if there's no cash or less cash coming up from the portfolio companies because they elect to pick, the the cash to pay those dividends has to come from somewhere. Right? And we think it's gonna come from equity issuance. Right? So just to give it some context, 6% of all the private credit loans are picking. If we look at software heavy portfolios, some of the BDCs, that number is 13%. And if we if SOFR goes up, that number could go to the mid teens. That's impressive. Liquidity, that investors get from distributions, liquidity that is being drained. We've talked about it in credit. Ilco, I'll ask you. So massive issuance and converts this year so far. We'll we'll set a record, as you said. The ability to trade in the primary issuance space, but also the secondary issuance space with the liquidity changes in your space, how has that created opportunity for you? Well, it's it's it's it's a kind of ideal environment for us, obviously. You know, we we participate in the primary space, albeit that's a relatively small part of our portfolio. It's the secondary space that provides most opportunities. One can skin a convertible bond a thousand ways just because they live in that world in between equities and fixed income. So we deploy 10 odd strategies with four sub strategies and look at the convertible bond from all angles and have plenty opportunities due to that massive liquidity, due to that massive demand, although we run a, you know, market neutral portfolio, but still lot of lot of opportunities. Great. Big issuance creates a lot of secondary trading. Right? That's a that's a theme across all of our portfolio management teams where we like big issuance everywhere from treasuries, unfortunately, for, US taxpayers to mortgage issuance to credit issuance. Right? Last big question that I get all the time, about AI and how has AI impacted, your businesses, our business. I'll let each of you speak. Bob, maybe talk a little bit about how AI has impacted how you guys manage money. Yeah. I mean, AI has been really instrumental, in our due diligence of real estate. You know you know, with with CMBS, you're dealing with a large pool of mortgages in different geographies and different sectors, and you really need kind of, like, that kind of boots on the ground local flavor. And with AI, you know, going from scraping, new sources, local, newspapers about, like, new tenants coming in or leaving or new, companies starting up, which will increase the, the economies in these individual markets, that's, you know, happening much quicker than us trying to look up the little local paper there or or discuss with a local broker the news as it's coming out. In addition, AI has done a much better job in our space of, like, you know, aggregating, larger swaths of data and being able to, filter it to us. And, for example, like, you know, geofencing of individual buildings and markets where you can, you know, see in in real time how many people are coming through, you know, on any, you know, individual day or hour of the workday going into that building or going into an individual store within within a mall and how long they're spending inside of that mall. So, you know, having that information now, like, you know, at your fingertips is really, making, you know, our job easier as well as the decision makers who make them decide where they're gonna put up their new, you know, real estate. So, yeah, it's it's been super helpful. Critical difference than 10 ago. Yeah. Much different. Much different. Okay. It's it's amazing. You know, we weave, AI into our investment process. It doesn't replace the investment process. You know? We we screen real time, 1,200 names. We monitor, prices real time, get alerts, get signals. We pass complex bond documents, and all this makes our process faster, more reliable, ultimately more consistent. Very important. Well, we we we've created, also two, AI analysts, Harry and Sally, who've never met, and I doubt they will ever meet. But we throw, all kinds of questions, at them. And, you know, by design, they always disagree, and which is is is hilarious. And it's thought provoking, but it really helps our, investment process, our thought process, you know, to the to the next level. So, again, AI is not replacing, our process. You know? The the the decision about a trade, the judgment of a trade remains firmly with the team. AI just tells us where to look. It doesn't decide what we own. Yep. Harry and Sally, you have a Harry and Sally moment? We sadly, we don't. But I've had a really interesting lens to view the AI theme. As you know, I I sit on a cross functional working group within Mariner, working on AI. And through my involvement in that group, it became abundantly clear to me that you need to make room in your budget for token spend. Every company in America will have to. And the most logical place to clear out to make room for that token spend is in your tech budget, and that really speaks to software and software subscriptions and seat licenses. And so that's really where it's informed, you know, coming back to our left and right, buckets of things that we like and don't like. Software is squarely in that bucket of things that we don't like because the, the making room for token spend is pernicious. It doesn't matter whether you're a system of record, or whether you're just a subscription software. Renewals are gonna be lower. Great. Thank you. Thank you, guys. I wanna thank the three PM teams that are with us here today, and the 24 other teams at Mariner. We'll hear more from them, in the near future, and thank everybody for joining. If you, enjoyed this presentation, please share it on the link. If you have any questions for us, please reach out. We're here 247. Thank you very much.