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[Music]
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welcome to this episode of Opportunity
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Matters I'm Kim tropar and today's
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conversation is on finance really what
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we want to look at today is is access
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opportunity
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education and look for what can be done
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and what's missing in terms of those who
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want access need access in finance
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settings to have it and we've got two
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great guests to to help us through that
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uh first I'll introduce a former student
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David R Jones he's the president and CEO
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of Castle Securities LP a leading
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Boutique Investment Bank with a broad
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offering of financial services including
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Equity sales and trading fixed income
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sales and trading and financial advisory
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Services since founding Castle Oak
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Securities in 2006 Mr Jones has overseen
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the substantial growth of the firm's
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business and and activities and
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Personnel David is a proud graduate
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served on the warden's school graduate
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executive board from 2012 to 2023 and
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brings over 30 years of Wall Street
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Experience to today's
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conversation and uh as I said most
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importantly he's a former student of
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mine David welcome back hey great good
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to be here Ken thank you for having me
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all right um next is a a longtime
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colleague uh Professor Keith wgel he's
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the
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Marx derol family Professor mer Meritus
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of management see some of us don't even
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give credit to these people that paid
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for our chairs I'm proud of you for
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doing that
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appropriately he's been a professor and
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a colleague of mine at wardon for 36
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years sounds like a bunch of old guys
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doing this Finance conversation here he
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co-founded Bridges to wealth in 2012
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with a mission to close the wealth Gap
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through evidence-based education and
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opportunity the program empowers youth
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parents and community members with
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Finance financial and business life
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skills so so really and you can hear
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from the introductions what we're going
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to do is really talk about the uh the
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Alpha and Omega of of Finance kind of
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the the entry level
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space What kinds of Education can we
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provide I mean and often people talk
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about F financial literacy you know and
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and our Dean here talks a lot more about
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financial fluence
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like how do we get people to engage and
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understand finance a bit more and then
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at David's level and Keith can speak to
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this these issues too at the highest
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level how do we
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get more access to people that don't
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traditionally have access to the highest
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levels of finance and places like
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investment backing private Equity access
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to Capital and the like so so that's
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that's the goal of today's
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conversation and I'll start off with
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with you David if you could just just
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talk some about your thoughts on the
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racial wealth Gap and how that fits in
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with today's economic landscape in the
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issues I mean I think you know when I
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think about the the the racial wealth
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Gap you know and I think about the
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economy the US economy um and this Gap
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obviously we known the the social
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injustice that that happened over
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Generations that that that caused this
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um we always talk about we want the
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economy to grow and and those are when
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they talk about it they don't really
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kind of take how we're going to grow and
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they talk about you know more money
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being the economy and businesses growing
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and and and um things but those
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injustices those
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disparities um are a problem in terms of
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not having full participation in the
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economy to help grow it um and when you
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you don't have that in terms of um folks
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who uh have uh you know have been
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disadvantaged for a long time and and
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you know things like the home ownership
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and income and savings and Investments
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that really you know help drive the
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economy and then when the economy slows
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down those things hold people back you
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really have a cycle of folks that aren't
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really participating so I always think
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about through this Gap uh and how it
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impacts the economy but also if we want
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to fix it we've got to sort of raise
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that you know the the disadvantage folks
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the historically disadvantaged um groups
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to help make the economy you know much
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more stronger I you know I do think
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about it I think about it's it's a you
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know a cycle that that we've got to get
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out of because if you you know if you
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the unemployment rates um you know cause
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people that don't have the wealth or the
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substance to you know get out and you
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know survive through that through
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through the economy it's just a
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Perpetual cycle not access to the
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education and Healthcare all that um is
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is is wrapped up into that and you can
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kind of take it all apart but you know
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not you know that's that's what I think
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about sort of this this Gap and how it's
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really affecting the economy and getting
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the economy going yeah yeah David it is
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really something one of my U uh team
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members um Maddie she she said you know
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be sure you talk about these
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foundational issues about why the wealth
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Gap exist and the structural issues that
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are there that for example
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prevented home ownership that that
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prevented access to Capital to investing
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businesses to start business and and I
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don't care the the ethnicity or the
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religious background or or the
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citizenship level of of whoever it is if
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you haven't been able to to accumulate
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Capital over Generations you're in a
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different position than somebody who has
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done so for a long period of time and
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and they talk about it in terms of you
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know they want to make sure people know
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now when you talk about Inc Converse as
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well right you right and people I got a
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good job and get paid every that's
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that's not that's a component but in
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terms of the the the wealth creation and
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the stability it creates within a within
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a household within communities is very
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impactful and you know I'm not smart
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enough or you know to say and Gra Asing
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you know for um the generations the
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centuries that those injustices took
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place and how that you know how long
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does it take to get out of that and
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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
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that people are in and you know again I
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don't have the answer but it's a real
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problem this racial wealth Gap yeah I
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mean one one of the things that that
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that I do is to uh work with athletes
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and you know it's almost a a
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foundational conversation with some of
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them when they're making you know they
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get a sign and bonus of a couple million
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dollars and they might accidentally use
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the word I'm wealthy I said no you you
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are you are rich in this moment but you
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are you don't have wealth you can have
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wealth you you can work to have wealth
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but there's some more steps to that and
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by the way your wealth is going to be
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difficult for you to to catch up with
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the wealth that some others have had for
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for Generations so th this is a perfect
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lead in to the man who created Bridges
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to
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wealth professor professor Keith Keith
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wgel so Keith why don't you talk some
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about the work that you you've done sure
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and and why you do it how it ties in
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with this kind of this this this
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Foundation that we we began to layer
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sure well Ken since you've already
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revealed my age I will uh confirm it by
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saying that I'm really a child of the
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civil rights movement and that's was my
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big first social movement so I go back
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to that point and in uh 1963 Martin
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Luther
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King uh gave a fairly famous speech
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called why we can't
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wait and in that speech he said speaking
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of white Americans they have deplored
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Prejudice but tolerated or ignored
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economic
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Injustice and so if we look at that when
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he made that speech and we look 60 years
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forward to like where we are today we
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can ask ourselves what has changed in
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those 60
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years the biggest thing that has changed
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is a wealth Gap continues to
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grow almost monotonically and we talk
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about the wealth Gap but most people
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don't understand how big the wealth Gap
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is based on the 20 you know 20 census if
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we look at white households the median
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wealth of White House households is a
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little bit over
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$187,000 the median wealth of black
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households is equal to
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$14,000 again you know that's way more
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than 10 times and again this wealth Gap
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continues to grow so why we're
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decreasing the income gap we're not
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doing anything with the wealth Gap and I
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would claim that since Martin Luther
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King made that speech in
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1963 that black households are even in a
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a worse position so so interesting you
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rais this in the way that you do you
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think about you know a lot of the uh
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controversial Dei conversation now is
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about access to
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jobs
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and that's just the tip of the iceberg
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the problem the idea of of getting
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having some regular Revenue getting a
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salary or you get even a big salary is
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not really what's at at the heart of the
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problem so you you've identified this
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household number that's at a national
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level that's problematic and one of the
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issues we should be addressing and many
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people are taking a lot of approaches at
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it is how to how to close that Gap right
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and the other thing with wealth that
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that we want to uh remember right if you
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look at society as a
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network okay and we look at the wealth
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disparity the wealth disparity hole is a
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central node and what I mean by that is
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it causes all these other disparities in
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our society so there's growing and
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growing evidence that says that the
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health of a household depends on the
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wealth of the household so if we have a
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wealth Gap we have a current health gap
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which is going to get
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bigger and again we and we've seen this
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in covid where minority households were
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affected significantly worse we have an
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education disparity low wealth
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households do not have as many resources
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spend on their children's education we
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have an a home own ownership disparity
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home ownership is one way you can grow
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wealth we have a criminal justice
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disparity because low wealth households
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do not have the resources to you know
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fight the criminal system so again
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wealth is really really
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important and I think that's why this
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program fits in with the vision of Dean
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James and the vision of her
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Coalition about using business practices
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to really transform people's lives and
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again uh in our program we have uh
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empirical evidence showing how we have
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transformed people's lives yeah so so so
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I do want let's let's move away from the
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the Dismal state of things let's talk
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about some of the affirmative steps that
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that we can take and have taken um at at
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these two two different levels and I
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think it's it's fascinating to think
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about this first the the entry level
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kind of educational level to kind of
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bridge a path to wealth and and then
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David I want to come back to you and
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talk about access to your business and
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access to um these you know one of one
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of the things that that that I often
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talk about too is is thinking about real
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real money big money money at levels
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that that that's just
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unimaginable uh unless you've been
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exposed to it one one of the uh one of
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my favorite colleagues here at pen in my
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long period of time here was U Professor
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Elijah Anderson and I used to go to to
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lunch with him once a week he's a
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sociologist I'm this you know business
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school person we kind of exchange
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ideas and he said to me once
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you know what I got the answer to all
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these problems it won't happen tomorrow
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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
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my seat waiting for him say he says the
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answer is
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exposure that if if we can
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expose groups that don't know about
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these things at the earliest ages
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earliest generations and continuously do
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it we'll get some movement so I always
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think about that that
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exposure uh uh kind of idea but let's
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talk about what what you do Keith and
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and then David I want to come back and
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talk about exposure uh in in into your
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business what talk talk about the
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practical way that you provide the
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education sure so Bridges to wealth is a
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uh community- based program it's a
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unique program no other business school
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has a program like it and basically what
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we do is we go into the community we
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give we we give them basic education at
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both the high school level and the adult
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level and then we give them
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opportunities to help them put what we
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taught them into practice and this
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long-term engagement is really really
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important so we encourage people we can
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show how people are changing their
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financial
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behaviors and uh so forth and I just
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want to say business schools have a
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responsibility they're in a very unique
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pos position because first of all we
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have the knowledge on how to show people
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how to generate
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wealth and we're in a unique position to
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create what I would call this community
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wealth
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ecosystem which is a a public private
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partnership and it's exactly what the
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dean and her team is doing so talk about
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Le let's so you go to the communities
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and and you go you do it at different
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levels so so kids parents and in one of
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its forms how do you get them to
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understand this this path to wealth or
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at least at least a greater positioning
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than they have you just talk about the
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the pressure sure so again it's very
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simple rules again so most
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people uh they overestimate how
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difficult it is to be wealthy especially
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in the market I'm still overestimating
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but so first we show them sort of you
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know how to generate wealth uh you know
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and we give them very very simple rules
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and one thing you want to understand is
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we have a our competitive advantage over
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any Financial Service
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Company is that we're not selling
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anything we don't charge for our program
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none of our
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services and people trust us I started
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with our churches we started you know
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going to churches uh word has spread and
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people see their investing dollars grow
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growing so so at a at a basic level one
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path may be to introduce communities
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that have never seen index funds for
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example to say you you take a small
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amount of money and now a lot of these
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um investment firms allow you to to
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invest you know a dollar as little as a
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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
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people listen to may say it can be a
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frightening experience to say wait a
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minute how I'm in the stock market how
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how do I do this so so it's that kind of
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again as Elijah Anderson said it's the
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kind of exposure in how to do this and
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they get to see how it how it grows
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along the way so so so David you're at
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the at this other level you're you're
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you're kind of the world of those firms
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that that take in those those
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$1 um and and often it's much more than
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$1 what's the story to access in in your
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business and and to to the wealth that's
00:16:56
available in in in your business
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so um and and Keith that sounded like a
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a wonderful wonderful program um you
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know when I look at sort of what we have
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here at Castle Lo um and and you know I
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co-founded this 17 years ago and
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for individuals now we have you know 70
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employees five offices around the
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country we've
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raised over4 trillion dollars for us
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corporations and we've got um we trade a
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hundred hundreds of millions of dollars
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in fixed income and Equity securities
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every day so I tell you this is the
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Alpha and Omega from one dollar two two
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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
00:17:42
a two twofold I am in that High Finance
00:17:45
world but I'm also when I look at I'm a
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small business owner I'm a minority
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owned business owner and so from the
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lens I look at is you know what you said
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Ken about exposure I really do think
00:18:00
about and we focus on a lot here uh of
00:18:04
of of giving back and it's not just you
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know our treasure our our money which we
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do a lot of that I'll talk a little B
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about that but just our time as well
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because our exposer these kids just
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seeing me as a CEO of a company seeing
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my management team that's 85% minority
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or or women that that when we talk to
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these kids we can see their eyes light
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up just to get them interested in you
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know what we're doing um and so that
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exposure part I you know Professor
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Elijah was he's correct on saying that
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that we we do focus on that but um one
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of the things also from what I look at
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when I came out of of warden I think
00:18:45
Wall Street itself the investment Banks
00:18:48
I think it's less sparse today than it
00:18:50
was then with minority individuals in
00:18:54
the in the sea Suite levels um and part
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of that is is you know it's happen
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what's happened is their pipeline is
00:19:01
kind of um you know dried up a little
00:19:05
bit because I think it's you know
00:19:06
they've got you know tech companies that
00:19:07
are growing and paying a lot of money
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you got private Equity guys that are
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hiring from the colleges and and inba
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programs now and a lot of kids are going
00:19:16
on the entrepreneurial route so that
00:19:18
pipeline is is less but what we're doing
00:19:21
from day one after you 17 years but from
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day one we've had an internship program
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um and was you know started just as a
00:19:30
summer internship program and now we we
00:19:32
focus on our you know our analyst you
00:19:35
know one and twoe analyst here but we
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feel we're helping to increase that
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pipeline you know very small we know
00:19:42
wall Street's got a lot of folks we're a
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small company but trying to give that
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exposure and that training to uh folks
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who who don't have that might not get
00:19:51
that opportunity anywhere else I you
00:19:54
know Ken I will tell you K keth I will
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tell you I've made some decisions on
00:19:58
hiring at at the end of the day on folks
00:20:01
who I think you know might not get that
00:20:03
opportunity you know if it's a if it's a
00:20:06
uh if it's a tie it's like we might have
00:20:09
to say this this one kid might not get
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another opportunity to get exposed to
00:20:12
this business and Excel and um and so
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that's what we're doing in terms of
00:20:17
internally here you know I mentioned our
00:20:20
our our money give back because we
00:20:22
leverage we try to leverage our give
00:20:24
back into organizations that are have
00:20:26
that same mindset we have so we have
00:20:28
three pillars it's um education and you
00:20:33
guys probably know I have scholarship
00:20:35
set up at at at Gordon and and my
00:20:39
undergrad Boston University focused on
00:20:41
finance focused on people of color uh
00:20:44
and I also uh so it's education
00:20:46
professional development as well as um
00:20:49
Community impact and those are the areas
00:20:51
we sort of want to put our dollars to
00:20:53
kind of Leverage it with organizations
00:20:56
that sort of can do help give that
00:20:59
exposure or get you know a diverse group
00:21:02
of talent you know looking at looking at
00:21:04
this business you know one of the things
00:21:07
that that you reminded me of David
00:21:10
is we've got some other programs here at
00:21:13
Wharton that that try to do some of this
00:21:16
exposure work too we're um in the
00:21:19
leadership of of Vault Finance which is
00:21:21
a a combination of of uh companies
00:21:24
working with Wharton to expose uh at
00:21:27
this point to traditionally U
00:21:29
historically black colleges and
00:21:30
universities to the alternative Finance
00:21:33
business and and again I think about you
00:21:35
know even my undergrad days at Stanford
00:21:39
University I didn't know anything about
00:21:42
Investment Banking or or I I think those
00:21:44
kinds of things existed in in the 70s
00:21:46
didn't they but I didn't know anything
00:21:48
you know I I wish I had had as as an as
00:21:50
an econ major I just wasn't in the orbit
00:21:53
of understanding this this higher
00:21:55
Finance kind of uh kind of opportunities
00:21:58
that exist so so this is this really is
00:22:00
the the bookend piece to to the work
00:22:04
that that Keith is doing and we've got
00:22:07
some other professors too that are
00:22:08
starting to do some of this this kind of
00:22:11
kind of work and I just want to throw
00:22:12
out a wild card card kind of question
00:22:16
and then kind of allow you both to close
00:22:18
out with with whatever big takeaway you
00:22:21
make sure people uh have um AI I mean
00:22:26
how can AI
00:22:28
um help in this space just in kind of a
00:22:31
a 30- second thought of of things you
00:22:34
you'd like to see or that you think AI
00:22:36
could do or people should think about as
00:22:39
AI invades everything that we do I I'll
00:22:42
I'll start that's a double-edged s and
00:22:44
it's sort of like the uh uh evolution of
00:22:47
the internet it it can be a
00:22:51
equalizer something that can level the
00:22:53
playing
00:22:54
field um if utilized correctly for all
00:22:58
all folks but it also could be very bad
00:23:01
if we don't have if folks don't have
00:23:03
access to certain groups don't have
00:23:05
access to that and it's the same like as
00:23:07
I talk about the internet so if you know
00:23:10
one of my things is that we need to make
00:23:11
sure that you know all people have
00:23:13
access to the internet and technology
00:23:16
and so AI is going to be a very very
00:23:19
powerful gamechanging you know way of of
00:23:23
the way we live and if only certain
00:23:25
groups get access to that that's going
00:23:27
to be major problem and and Keith that's
00:23:30
your closing thought David Keith in your
00:23:32
30 second closing thought I just want to
00:23:35
point out that our audience in our our
00:23:39
participants if you look at them right
00:23:41
20% of them receive incomes lower than
00:23:44
20,000 over 50% receive incomes less
00:23:48
than
00:23:49
40,000 so again you know people have
00:23:52
this mistaken notion that you need lots
00:23:54
of you know money to start your p path
00:23:58
to wealth and that's not true and the
00:24:00
other thing is 73% of our participants
00:24:03
are women and empirically women are
00:24:06
actually better at investing than men
00:24:10
are but if you ask women nine out of 10
00:24:12
women say that men are better so part of
00:24:15
so you know part of our job is to again
00:24:20
create visions that people can see a
00:24:23
path going forward like I've had more
00:24:26
than one family think me for showing
00:24:28
them a path out of poverty because they
00:24:31
didn't know how to do it it's not like
00:24:34
people don't want to get out of poverty
00:24:35
they just don't know how to do it I
00:24:37
think we've laid out a lot in terms of
00:24:39
the
00:24:40
opportunities that exist to to move
00:24:43
forward to provide more opportunities in
00:24:46
finance for those who have not
00:24:48
traditionally had access so please join
00:24:51
us for the next episode and thank you to
00:24:53
you both uh of Opportunity
00:24:56
Matters
00:24:58
[Music]
00:25:01
I'm farita Griffith managing director
00:25:03
for the Wharton Coalition for equity and
00:25:05
opportunity in partnership with Wharton
00:25:07
Works led by Professor Damon Phillips
00:25:10
Business Roundtable and second chance
00:25:12
business Coalition we're bringing
00:25:13
together Business Leaders academics
00:25:16
State leaders and Justice impacted
00:25:18
communities for discussions on creating
00:25:20
Pathways to sustainable employment for
00:25:22
individuals who are formally
00:25:24
incarcerated to learn more and register
00:25:27
go to
00:25:28
ceo. won. up.edu
