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[Music] welcome to this episode of Opportunity Matters I'm Kim tropar and today's
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conversation is on finance really what we want to look at today is is access opportunity
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education and look for what can be done and what's missing in terms of those who
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want access need access in finance settings to have it and we've got two great guests to to help us through that
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uh first I'll introduce a former student David R Jones he's the president and CEO
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of Castle Securities LP a leading Boutique Investment Bank with a broad offering of financial services including
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Equity sales and trading fixed income sales and trading and financial advisory Services since founding Castle Oak
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Securities in 2006 Mr Jones has overseen the substantial growth of the firm's
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business and and activities and Personnel David is a proud graduate served on the warden's school graduate
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executive board from 2012 to 2023 and brings over 30 years of Wall Street Experience to today's
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conversation and uh as I said most importantly he's a former student of mine David welcome back hey great good
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to be here Ken thank you for having me all right um next is a a longtime colleague uh Professor Keith wgel he's
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the Marx derol family Professor mer Meritus of management see some of us don't even
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give credit to these people that paid for our chairs I'm proud of you for doing that
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appropriately he's been a professor and a colleague of mine at wardon for 36
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years sounds like a bunch of old guys doing this Finance conversation here he co-founded Bridges to wealth in 2012
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with a mission to close the wealth Gap through evidence-based education and opportunity the program empowers youth
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parents and community members with Finance financial and business life skills so so really and you can hear
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from the introductions what we're going to do is really talk about the uh the
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Alpha and Omega of of Finance kind of the the entry level space What kinds of Education can we
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provide I mean and often people talk about F financial literacy you know and and our Dean here talks a lot more about
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financial fluence like how do we get people to engage and understand finance a bit more and then
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at David's level and Keith can speak to this these issues too at the highest
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level how do we get more access to people that don't traditionally have access to the highest
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levels of finance and places like investment backing private Equity access to Capital and the like so so that's
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that's the goal of today's conversation and I'll start off with with you David if you could just just
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talk some about your thoughts on the racial wealth Gap and how that fits in with today's economic landscape in the
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issues I mean I think you know when I think about the the the racial wealth Gap you know and I think about the
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economy the US economy um and this Gap obviously we known the the social injustice that that happened over
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Generations that that that caused this um we always talk about we want the economy to grow and and those are when
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they talk about it they don't really kind of take how we're going to grow and
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they talk about you know more money being the economy and businesses growing and and and um things but those
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injustices those disparities um are a problem in terms of not having full participation in the
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economy to help grow it um and when you you don't have that in terms of um folks
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who uh have uh you know have been disadvantaged for a long time and and you know things like the home ownership
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and income and savings and Investments that really you know help drive the economy and then when the economy slows
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down those things hold people back you really have a cycle of folks that aren't
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really participating so I always think about through this Gap uh and how it impacts the economy but also if we want
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to fix it we've got to sort of raise that you know the the disadvantage folks
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the historically disadvantaged um groups to help make the economy you know much more stronger I you know I do think
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about it I think about it's it's a you know a cycle that that we've got to get
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out of because if you you know if you the unemployment rates um you know cause people that don't have the wealth or the
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substance to you know get out and you know survive through that through through the economy it's just a
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Perpetual cycle not access to the education and Healthcare all that um is is is wrapped up into that and you can
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kind of take it all apart but you know not you know that's that's what I think
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about sort of this this Gap and how it's really affecting the economy and getting
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the economy going yeah yeah David it is really something one of my U uh team members um Maddie she she said you know
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be sure you talk about these foundational issues about why the wealth Gap exist and the structural issues that
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are there that for example prevented home ownership that that prevented access to Capital to investing
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businesses to start business and and I don't care the the ethnicity or the religious background or or the
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citizenship level of of whoever it is if you haven't been able to to accumulate
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Capital over Generations you're in a different position than somebody who has
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done so for a long period of time and and they talk about it in terms of you know they want to make sure people know
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now when you talk about Inc Converse as well right you right and people I got a good job and get paid every that's
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that's not that's a component but in terms of the the the wealth creation and
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the stability it creates within a within a household within communities is very impactful and you know I'm not smart
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enough or you know to say and Gra Asing you know for um the generations the centuries that those injustices took
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place and how that you know how long does it take to get out of that and that's what I was talking about sort of
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that it's it's a it's a it's a cycle that people are in and you know again I
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don't have the answer but it's a real problem this racial wealth Gap yeah I
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mean one one of the things that that that I do is to uh work with athletes and you know it's almost a a
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foundational conversation with some of them when they're making you know they
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get a sign and bonus of a couple million dollars and they might accidentally use
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the word I'm wealthy I said no you you are you are rich in this moment but you
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are you don't have wealth you can have wealth you you can work to have wealth
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but there's some more steps to that and by the way your wealth is going to be
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difficult for you to to catch up with the wealth that some others have had for for Generations so th this is a perfect
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lead in to the man who created Bridges to wealth professor professor Keith Keith
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wgel so Keith why don't you talk some about the work that you you've done sure
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and and why you do it how it ties in with this kind of this this this Foundation that we we began to layer
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sure well Ken since you've already revealed my age I will uh confirm it by saying that I'm really a child of the
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civil rights movement and that's was my big first social movement so I go back
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to that point and in uh 1963 Martin Luther King uh gave a fairly famous speech called why we can't
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wait and in that speech he said speaking of white Americans they have deplored Prejudice but tolerated or ignored
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economic Injustice and so if we look at that when he made that speech and we look 60 years
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forward to like where we are today we can ask ourselves what has changed in those 60
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years the biggest thing that has changed is a wealth Gap continues to grow almost monotonically and we talk
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about the wealth Gap but most people don't understand how big the wealth Gap
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is based on the 20 you know 20 census if we look at white households the median wealth of White House households is a
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little bit over $187,000 the median wealth of black households is equal to $14,000 again you know that's way more
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than 10 times and again this wealth Gap continues to grow so why we're decreasing the income gap we're not
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doing anything with the wealth Gap and I would claim that since Martin Luther King made that speech in
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1963 that black households are even in a a worse position so so interesting you rais this in the way that you do you
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think about you know a lot of the uh controversial Dei conversation now is about access to
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jobs and that's just the tip of the iceberg the problem the idea of of getting
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having some regular Revenue getting a salary or you get even a big salary is not really what's at at the heart of the
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problem so you you've identified this household number that's at a national
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level that's problematic and one of the issues we should be addressing and many
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people are taking a lot of approaches at it is how to how to close that Gap right
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and the other thing with wealth that that we want to uh remember right if you look at society as a
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network okay and we look at the wealth disparity the wealth disparity hole is a central node and what I mean by that is
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it causes all these other disparities in our society so there's growing and growing evidence that says that the
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health of a household depends on the wealth of the household so if we have a wealth Gap we have a current health gap
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which is going to get bigger and again we and we've seen this in covid where minority households were
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affected significantly worse we have an education disparity low wealth households do not have as many resources
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spend on their children's education we have an a home own ownership disparity
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home ownership is one way you can grow wealth we have a criminal justice disparity because low wealth households
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do not have the resources to you know fight the criminal system so again wealth is really really
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important and I think that's why this program fits in with the vision of Dean
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James and the vision of her Coalition about using business practices to really transform people's lives and
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again uh in our program we have uh empirical evidence showing how we have transformed people's lives yeah so so so
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I do want let's let's move away from the the Dismal state of things let's talk
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about some of the affirmative steps that that we can take and have taken um at at
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these two two different levels and I think it's it's fascinating to think
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about this first the the entry level kind of educational level to kind of bridge a path to wealth and and then
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David I want to come back to you and talk about access to your business and access to um these you know one of one
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of the things that that that I often talk about too is is thinking about real real money big money money at levels
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that that that's just unimaginable uh unless you've been exposed to it one one of the uh one of
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my favorite colleagues here at pen in my long period of time here was U Professor
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Elijah Anderson and I used to go to to lunch with him once a week he's a sociologist I'm this you know business
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school person we kind of exchange ideas and he said to me once you know what I got the answer to all
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these problems it won't happen tomorrow but this is the answer the answer is is
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it one word and I'm I'm at the edge of my seat waiting for him say he says the
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answer is exposure that if if we can expose groups that don't know about these things at the earliest ages
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earliest generations and continuously do it we'll get some movement so I always
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think about that that exposure uh uh kind of idea but let's talk about what what you do Keith and
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and then David I want to come back and talk about exposure uh in in into your business what talk talk about the
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practical way that you provide the education sure so Bridges to wealth is a uh community- based program it's a
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unique program no other business school has a program like it and basically what
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we do is we go into the community we give we we give them basic education at both the high school level and the adult
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level and then we give them opportunities to help them put what we taught them into practice and this
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long-term engagement is really really important so we encourage people we can show how people are changing their
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financial behaviors and uh so forth and I just want to say business schools have a
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responsibility they're in a very unique pos position because first of all we
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have the knowledge on how to show people how to generate wealth and we're in a unique position to
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create what I would call this community wealth ecosystem which is a a public private
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partnership and it's exactly what the dean and her team is doing so talk about
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Le let's so you go to the communities and and you go you do it at different levels so so kids parents and in one of
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its forms how do you get them to understand this this path to wealth or at least at least a greater positioning
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than they have you just talk about the the pressure sure so again it's very simple rules again so most
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people uh they overestimate how difficult it is to be wealthy especially in the market I'm still overestimating
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but so first we show them sort of you know how to generate wealth uh you know and we give them very very simple rules
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and one thing you want to understand is we have a our competitive advantage over
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any Financial Service Company is that we're not selling anything we don't charge for our program
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none of our services and people trust us I started with our churches we started you know
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going to churches uh word has spread and people see their investing dollars grow
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growing so so at a at a basic level one path may be to introduce communities that have never seen index funds for
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example to say you you take a small amount of money and now a lot of these um investment firms allow you to to
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invest you know a dollar as little as a dollar and you say I'll show you how to
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do this and and it it can be um and many people listen to may say it can be a frightening experience to say wait a
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minute how I'm in the stock market how how do I do this so so it's that kind of
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again as Elijah Anderson said it's the kind of exposure in how to do this and
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they get to see how it how it grows along the way so so so David you're at the at this other level you're you're
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you're kind of the world of those firms that that take in those those $1 um and and often it's much more than
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$1 what's the story to access in in your business and and to to the wealth that's
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available in in in your business so um and and Keith that sounded like a a wonderful wonderful program um you
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know when I look at sort of what we have here at Castle Lo um and and you know I
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co-founded this 17 years ago and for individuals now we have you know 70 employees five offices around the
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country we've raised over4 trillion dollars for us corporations and we've got um we trade a
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hundred hundreds of millions of dollars in fixed income and Equity securities every day so I tell you this is the
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Alpha and Omega from one dollar two two trillions of dollars okay and it's it's
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it's a it's a a great business and it's a two twofold I am in that High Finance
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world but I'm also when I look at I'm a small business owner I'm a minority
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owned business owner and so from the lens I look at is you know what you said Ken about exposure I really do think
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about and we focus on a lot here uh of of of giving back and it's not just you
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know our treasure our our money which we do a lot of that I'll talk a little B
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about that but just our time as well because our exposer these kids just seeing me as a CEO of a company seeing
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my management team that's 85% minority or or women that that when we talk to
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these kids we can see their eyes light up just to get them interested in you know what we're doing um and so that
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exposure part I you know Professor Elijah was he's correct on saying that that we we do focus on that but um one
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of the things also from what I look at when I came out of of warden I think Wall Street itself the investment Banks
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I think it's less sparse today than it was then with minority individuals in
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the in the sea Suite levels um and part of that is is you know it's happen what's happened is their pipeline is
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kind of um you know dried up a little bit because I think it's you know they've got you know tech companies that
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are growing and paying a lot of money you got private Equity guys that are hiring from the colleges and and inba
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programs now and a lot of kids are going on the entrepreneurial route so that pipeline is is less but what we're doing
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from day one after you 17 years but from day one we've had an internship program
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um and was you know started just as a summer internship program and now we we focus on our you know our analyst you
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know one and twoe analyst here but we feel we're helping to increase that pipeline you know very small we know
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wall Street's got a lot of folks we're a small company but trying to give that
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exposure and that training to uh folks who who don't have that might not get
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that opportunity anywhere else I you know Ken I will tell you K keth I will tell you I've made some decisions on
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hiring at at the end of the day on folks who I think you know might not get that
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opportunity you know if it's a if it's a uh if it's a tie it's like we might have
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to say this this one kid might not get another opportunity to get exposed to this business and Excel and um and so
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that's what we're doing in terms of internally here you know I mentioned our
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our our money give back because we leverage we try to leverage our give back into organizations that are have
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that same mindset we have so we have three pillars it's um education and you
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guys probably know I have scholarship set up at at at Gordon and and my undergrad Boston University focused on
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finance focused on people of color uh and I also uh so it's education professional development as well as um
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Community impact and those are the areas we sort of want to put our dollars to kind of Leverage it with organizations
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that sort of can do help give that exposure or get you know a diverse group of talent you know looking at looking at
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this business you know one of the things that that you reminded me of David is we've got some other programs here at
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Wharton that that try to do some of this exposure work too we're um in the leadership of of Vault Finance which is
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a a combination of of uh companies working with Wharton to expose uh at this point to traditionally U
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historically black colleges and universities to the alternative Finance business and and again I think about you
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know even my undergrad days at Stanford University I didn't know anything about
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Investment Banking or or I I think those kinds of things existed in in the 70s didn't they but I didn't know anything
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you know I I wish I had had as as an as an econ major I just wasn't in the orbit
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of understanding this this higher Finance kind of uh kind of opportunities that exist so so this is this really is
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the the bookend piece to to the work that that Keith is doing and we've got some other professors too that are
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starting to do some of this this kind of kind of work and I just want to throw out a wild card card kind of question
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and then kind of allow you both to close out with with whatever big takeaway you
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make sure people uh have um AI I mean how can AI um help in this space just in kind of a
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a 30- second thought of of things you you'd like to see or that you think AI
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could do or people should think about as AI invades everything that we do I I'll
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I'll start that's a double-edged s and it's sort of like the uh uh evolution of
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the internet it it can be a equalizer something that can level the playing field um if utilized correctly for all
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all folks but it also could be very bad if we don't have if folks don't have
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access to certain groups don't have access to that and it's the same like as
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I talk about the internet so if you know one of my things is that we need to make
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sure that you know all people have access to the internet and technology and so AI is going to be a very very
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powerful gamechanging you know way of of the way we live and if only certain groups get access to that that's going
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to be major problem and and Keith that's your closing thought David Keith in your
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30 second closing thought I just want to point out that our audience in our our participants if you look at them right
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20% of them receive incomes lower than 20,000 over 50% receive incomes less than
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40,000 so again you know people have this mistaken notion that you need lots of you know money to start your p path
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to wealth and that's not true and the other thing is 73% of our participants
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are women and empirically women are actually better at investing than men are but if you ask women nine out of 10
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women say that men are better so part of so you know part of our job is to again
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create visions that people can see a path going forward like I've had more than one family think me for showing
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them a path out of poverty because they didn't know how to do it it's not like
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people don't want to get out of poverty they just don't know how to do it I
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think we've laid out a lot in terms of the opportunities that exist to to move
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forward to provide more opportunities in finance for those who have not traditionally had access so please join
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us for the next episode and thank you to you both uh of Opportunity Matters [Music]
00:25:01
I'm farita Griffith managing director for the Wharton Coalition for equity and
00:25:05
opportunity in partnership with Wharton Works led by Professor Damon Phillips Business Roundtable and second chance
00:25:12
business Coalition we're bringing together Business Leaders academics State leaders and Justice impacted
00:25:18
communities for discussions on creating Pathways to sustainable employment for individuals who are formally
00:25:24
incarcerated to learn more and register go to ceo. won. up.edu