Interactive Investor

Anthony Scaramucci on investing, and his brief stint as Trump’s director of comms

12th August 2021 13:04

Jemma Jackson from interactive investor

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The latest interactive investor Family Money Show podcast with Gabby Logan is out now.

interactive investor, the UK’s second-largest DIY investment platform, has today published its third episode of the interactive investor Family Money Show, featuring Anthony Scaramucci – a US financier who had a brief but memorable stint as President Trump’s director of communications.

In the episode, Scaramucci tells Gabby Logan, interactive investor’s Family Money Ambassador, why he has been to more Christmas parties hosted by the Obamas than the Trumps, how his attitude to risk changed as he got older and why he takes Mel Brooks’ advice over everybody else’s.

Scaramucci worked at Goldman Sachs in the 1980s and 1990s. After leaving Goldman Sachs, he founded Oscar Capital Management and later the investment firm SkyBridge Capital. He lasted only 11 days as White House communications director, after launching a strongly worded attack on members of the Trump administration in an interview with a reporter he believed was off the record just days into his role.

Below are some highlights from Scaramucci’s interview. You can listen to the interview in full here.

Entering politics to build wealthy connections

“I got into politics because I had no network. I never hit a golf ball. I never swung a tennis racquet. I never saw the inside of a country club. I never saw the inside of a corporate office. I had no corporate mentor growing up because we live in a blue-collar neighbourhood. We had landscapers and my dad was an operational engineer, which is euphemism for a crane operator. And we had mechanics we didn't have CEOs where I was living.

“When I got to Goldman and got fired and rehired, I was in the high-net-worth area. I had to meet wealthy people. So, I said: ‘OK, I'm going to go into politics.’ I wrote my first cheque to Rudy Giuliani [Republican politician]. It was a $250 cheque. He lost that election, which was actually very good for me because we became friends. And then when he won in 1983, he opened up his network to me, which is very helpful.”

Best investment:

Buying a tequila brand: “I think I was 15 to one on that investment. We put it in the HBO show Entourage, it caught fire, and then we sold it to the French spirits company Bernard, I think it was called. That was an incredible investment.

“I just followed up with Wheels Up – a private aviation company that's worked out very well. I have a crypto I have a piece of a crypto exchange, which has been marked up significantly. But I also have a series of losers.”

Worst investment

“The most painful one was at the height of my investment arrogance. I was 27, and for some reason, I decided that I knew more about biotechnology than biotechnology people or scientists or medical doctors. I obviously know everything. And so, I had the worst thing that can happen to you, I bought these call options on a biotech company. And they exploded to the upside. So that fortified me with great confidence about what a genius I was. And so, I doubled down, as this company was moving from phase two to phase three approval for the FDA [US drugs regulator] and they didn't get the approval.

“And so, I had all these call options that were levered in my account. Unfortunately, I didn't even understand – this is how arrogant and stupid I was – how the leverage worked in my personal account. And so, the margin desk called me at Goldman Sachs and told me: ‘You're in the hole by $50,000.’ And let me tell you something, at that time in my life, we're at $150,000 of school debt. I really couldn't afford it.

“I went to go see my boss… and I explained to him what I did. And he looked at me and said, ‘Man, you are as stupid as stupid could be. And hopefully you learned your lesson that the markets know more than you do.’”

On backing Obama

“One of my buddies called and said: ‘Do you remember Barack Obama from law school?’ And I'm like, ‘No, I don't remember Barack Obama...’ [This was around the time] he gave the speech in Boston at the convention in 2004. I said, ‘I sort of vaguely remember that.’ ‘Well, he's running for president and we're doing a big fundraiser for him. I knew him in law school, and I want you to come to the fundraiser.’ I was politically agnostic at the time. I said, ‘Sure, I'll come to the fundraiser.’

“So now I have my cheque. And I'm meeting then Senator Obama. And I walk up to Senator Obama, I said, ‘Listen, we didn't really know each other in law school,’ I said, ‘but I'm about to write you a big cheque.’ I said, ‘Can I lie to everybody and tell them that you and I knew each other in law school?’ And Obama looks at me, he's like: ‘Hey, I tell you what, if you double the amount of the cheque, we could take it all the way back to Hawaii. How's that?’ And then he smiled, [which] obviously, was like the best smile in American politics since Jack Kennedy. So, you know what I did? I ripped up the cheque, I wrote him another cheque. I doubled the amount. And, needless to say, I went to more Barack and Michelle Obama Christmas parties at the White House than I did Donald Trump ones.

“I supported him because my friends were supporting him. And I'll tell you something ironic. At that time, I said to him: ‘Well, how am I ever going to know somebody that's actually running for president?’ Well, it turned out I ended up knowing a couple of these people, you know, including the current president, but I was a Republican.”

On joining Trump’s presidential campaign

“So, when he [Obama] started doing less than republican things, I went to go work for Governor Romney. And that was unsuccessful (though Mitt is a great guy). I learned a lot from him. And then of course, I was with Scott Walker [Republican politician], and then Jeb Bush [Republican politician].

“So, Donald Trump was not even choice number one or two. But when he called to recruit me, that's where the ego kicked in. And, you know, you do a lot of regrettable things based on your ego. So, if your listeners are paying close attention, keep your ego in check. Because the thought of working for a presidential candidate that could be successful, was probably too tempting for me.”

On his brief stint as Trump’s director of communications

“I'm in the Oval Office. I had been in the Oval Office a few times. I was there when President Clinton was in office. I was there once when President Obama was in office. So, I had been to the Oval Office a few times before I took the job. But I don't care how many times you go to the Oval Office, it's an intimidating place to be – your heart is racing.

“And so, it's my first day on the job I'm sitting across from him at the resolute desk. And if you look up, there is the [seal of the presidency of the United States] on the Oval roof. So, I look up, I look over at President Trump and I say: ‘I mean, we're in the Office of the President,’ I said, ‘you're the president.’ I said: ‘My heart's racing a little. When you sat behind that desk, was your heart racing?’ And in fairness to him, it was very human what he said. He said: ‘Yeah, the first time I sat here, I took in the magnitude of the situation, and my heart was racing.’

“Now you may or may not remember this, I think Theresa May was his first state visitor. He said to me then: ‘I'm going to I get to greet Theresa May, the Prime Minister of England, at the North Portico [a section of the White House], and my first reaction is where the hell is the North Portico, right?’ He didn't even know. I mean, you know, and it was like, very human.

“And then he looked at me, and he said: ‘But I gotta tell you something, Anthony, there's so much work. You'll be surprised at how quickly this just becomes an office, and you won't be as intimidated.’ And I gotta tell you, I was only there for 11 days, but by the third or fourth day, he was 100% right about that, because you were just absorbed in the work.”

On being fired

“Being fired from the White House was a huge disappointment. It turned out to be a blessing – I didn't know that at the time. But it was a huge disappointment.

“I have a phenomenal relationship with General [John] Kelly [former White House chief of staff]. He fired me. It's what you make of things that happened to you. It's not necessarily what happens to you. And it's about your mindset.

“I can still see my dad in that green uniform, you know, with the grease on them – and the boots. Unfortunately, he's lost a good part of his hearing, because he worked in heavy machinery at a time where we didn't put the, you know, the plugs in and there was no health and safety… And so, I think about him, and I'm like, whatever the hell I'm going through, it's easier than that by like a quantum.”

What he learnt from his ill-fated White House experience

“I'm more humble. I think it's made me more psychologically minded. I think I have a lot more empathy for people that go through things. I think if you're having a bad day, you should call me. I can regale you in one of the worst days of my life, which was July 31, 2017. I had missed my child's birth on the 24th of July. I was stuck in Westford. Jenya, my wife, had filed for divorce, and I was fired from the White House. I was having a pretty bad day, OK. But I reconciled with my wife, obviously, I've got a great relationship with my now four-year-old.”

On how he thinks he is perceived by the public

“[My grandmother] had a great expression, which is cliche. But she used to say what other people think about you, is none of your business. And so, what you try to do, you try to spend your whole life trying to do that, of course, but you're in the age of social media, and media awareness. And we did media perception. So, it's impossible.

“Anybody that claims that they don't care what other people think about them, I think it's really not being genuine… When you get destroyed the way I did in 2017, and you're lit up by every late-night comedian, and you're rumbled on every cable show, you have to build a tough enough skin where you really don't care what other people think about not saying that it doesn't bother you. Of course it does!

“But I honestly don't know what people think about me. But the truth of the matter is, I don't let that run my life or ruin my day.”

Upbringing

Scaramucci was born into an Italian-American family in New York. While not penny pinching, he says his family ensured that they lived within their means. Scaramucci’s father was a construction worker. His grandfather gave him his first lesson in money management.

Scaramucci said: “My grandpa, my pop, took me to a Savings and Loan when I was 11 years old, I had a paper route. And so, I was making pretty decent money at age 11. And he told me to deposit $13, that was his lucky number. Now for a lot of people, that's an unlucky number. But for whatever reason, for my pop, that was a lucky number. So, I deposited $13, at age 11, in the first Federal Savings and Loan, and he told me that I was going to become a millionaire if I did that.”

Spoiling his children

“…I live by Mel Brooks’ [the American comedian] adage. He said: ‘Hey, relax – none of us are getting out of here alive.’ And so, my attitude is I spoil the living daylights out of my kids. But I also I have two parenting methodologies, which are quite unorthodox. I'm about bribery and threatening [as a parental tool]. OK, so those are my two tools. And so, my thing is, I try to shower my kids with everything, but I want them to work super-hard. And if it works great!

“When I got blown out of the White House, a lot of people would have rolled on something like that, but I got up like a crash dummy and just dusted myself off and went back to work.

It was a week after I got fired. I was walking with him [his son AJ] in Santa Monica, on the promenade, and he's like: ‘Dad, jeez, are you OK?’ And I'm like: ‘Yeah, not only am I OK, watch what I do with this thing.’

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

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