Placeholder Image

Subtitles section Play video

  • - Hi, everyone, Sal Khan here, from Khan Academy.

  • Welcome to our Daily Homeroom livestream.

  • For those of y'all who this maybe the first time

  • that your seeing this you're like,

  • "What is this link on YouTube or Facebook?"

  • This is our way of keeping everyone connected.

  • And when we saw the school closures start to happen

  • it seems like a lifetime ago,

  • but maybe seven or eight weeks ago,

  • we knew that Khan Academy had a unique role to play.

  • We saw our usage go up by a factor of three.

  • We started doing parent webinars, teacher webinars.

  • And we said in the time of social distancing

  • it would also be a way for people to feel connected,

  • if we did something like this.

  • And so this is just a forum to ask questions,

  • have interesting guests,

  • and make sure that all of you feel supported.

  • Today we have a really exciting guest,

  • I'll introduce her in a second.

  • But I do wanna give my standard announcement,

  • a reminder to everyone,

  • that Khan Academy we are a not-for-profit organization,

  • we exist because of philanthropic donations.

  • And so if you're in a position to do so,

  • please think about donating to Khan Academy.

  • I do wanna give a special shout out.

  • The last several weeks when they realized

  • that we were already running at a deficit before the crisis,

  • and that deficit was gonna get larger

  • because of this crisis, our server costs,

  • our ability to provide you even more supports,

  • they immediately stepped up.

  • First and foremost, was Bank of America,

  • that very first weekend when we realized

  • that the school closures were happening.

  • Followed closely be Google.org, AT&T, Novartis,

  • and Fastly have all stepped up to support this effort.

  • So if you, as an individual,

  • can help support that is great.

  • And if you are representing, or a corporation,

  • that is great as well.

  • We still need more help.

  • So with that I'm super excited to introduce our guest,

  • someone that I've known for awhile,

  • who I consider a friend,

  • and, I hope that she doesn't mind, a mentor,

  • someone who I've gotten a lot

  • of learning from over the last,

  • almost decade, that we've been working together.

  • Anne Finucane, who's the vice chairman of Bank of America.

  • And maybe a good place to start,

  • Anne, first of all,

  • I'd love to know how you're doing,

  • how you're navigating the crisis.

  • But especially as a leader of an organization

  • that has 210,000 employees,

  • how is your team coping with that?

  • And what are y'all doing to try to support

  • those 210,000 folks?

  • - Well it's great to be with you, Sal,

  • and thanks for having me.

  • So it is busy, it's busy for everybody of course.

  • But, at the bank, we are I'd say

  • 80% of the population are working from home.

  • 20% are in the office or in the financial centers

  • because we're considered a critical service,

  • so we have to be open, our doors open, trading,

  • as well as, being in the financial centers.

  • And it's, like everybody else, a lot going on for everybody.

  • People are trying to keep their kids educated,

  • so thank you.

  • While also getting to work in some way or another,

  • whether it's at home or in the office.

  • Of our 208, you said 210, I think it's 208,000 people.

  • The first thing we wanted them to know

  • is that everyone will be employed for 2020,

  • so that there'll be no layoffs

  • and that wouldn't be a concern that they would have.

  • If you have childcare needs,

  • we're trying to help with that.

  • So we are picking up the cost of trying to help

  • with childcare for everybody,

  • whether they're at home or they're in the office.

  • And then making sure people's medical needs

  • are taken care of.

  • This is an extraordinary health crisis.

  • We've never seen anything like it.

  • I don't think there's much to fully prepare us.

  • But as other guests have said,

  • honestly the financial crisis was maybe a dress rehearsal,

  • 9/11 was another sort of dress rehearsal for this.

  • And in each of these cases,

  • you're able to learn something

  • and apply it to the next time.

  • - And you know given your experience here,

  • well you know, y'all have been stepping up big time.

  • And I mentioned, you know I'm not just having you here

  • because y'all are one of our big supporters, but you are,

  • for many, many, years and then y'all stepped up even more

  • over this crisis.

  • But is a part of a broader strategy

  • that y'all are trying to do.

  • You know y'all announced a significant amount of support

  • for the COVID crisis,

  • and that's all things that are under your responsibility.

  • How are you thinking about that?

  • Where are you seeing the biggest needs?

  • Where are you trying to help?

  • What problems are you still trying to figure out?

  • - Well the first thing is probably,

  • what are we doing for our customers?

  • Well like maybe the first thing is the employees,

  • but I tried to give you a sense of that.

  • For our customers,

  • those that need it,

  • so a lot of people need help in a time like this.

  • They've lost their job,

  • or they're afraid they're gonna lose their job,

  • or their partner, or wife, or husband,

  • or whoever they're living with is maybe not working.

  • So we have offered to our customers,

  • and they can just go on the mobile app and do this,

  • if they need to defer their mortgage payment,

  • their small business loan, their auto loan,

  • their credit card, they can do that with a click.

  • And so we have had more than a million,

  • like 1.2 million of those deferrals made already.

  • And I'm sure that would continue on

  • for another couple of months.

  • So that's one very basic thing.

  • Another is to work with our customers

  • on the CARES Act, the new legislation.

  • So the new legislation has this program

  • called the Paycheck Protection Program for small businesses.

  • And we signed up 400,000 applicants

  • for that PPP program, as we call it.

  • And we have put thousands of people,

  • that don't normally do this, against that effort,

  • working 24 hours,

  • so three, 8 hour shifts,

  • to try to help people with signing up for it,

  • getting a loan.

  • And just to give you some stats on that,

  • about 78% of those that are signing up

  • are asking for something less than $100,000.

  • More than 75% of those have less than 10 people.

  • So it's really for the small businesses,

  • I mean truly small businesses.

  • If you look at less than 100 people,

  • it's about 98% of the population.

  • So between deferring payments

  • and setting up to signing up

  • for the Payroll Protection Program,

  • those are two very significant ways.

  • And then what you were referring

  • to is our philanthropic giving.

  • We give away, or we donate,

  • about $250 million a year in philanthropic giving,

  • and we do it at a local level.

  • So we try to participate,

  • through our Market President Group,

  • in 90 different markets,

  • giving to affordable housing, food insecurity,

  • to the homeless, you name it.

  • But, in this case, we added another $100 million.

  • And the reason we did is because there are

  • these emergency needs.

  • And actually, Khan Academy was one of the emergency needs

  • where obviously we have been a supporter for several years,

  • and we have a program with you, called Better Money Habits,

  • that we are crazy about.

  • And we have millions of people that have used it.

  • But in a case like this,

  • where you're going to be reaching out to schools

  • all over the country,

  • and helping teachers,

  • and those that are homeschooling their kids,

  • get up to speed, you needed money by today.

  • And so the same as local food banks, and homeless shelters,

  • and some programs helping people

  • that are in the emergency medical field.

  • We felt that we needed to do that very quickly,.

  • and a little less paperwork

  • and a little more haste, if you will.

  • - You know what I have to say,

  • you know very transparent,

  • and I'm not just saying this 'cause

  • we're on the livestream together,

  • but that very first weekend I remember

  • we had a meeting scheduled

  • with some of your team members,

  • and I was a little late for the meeting.

  • And I was like, "Oh, I'm so sorry I'm late for the meeting.

  • "You know we're just seeing a 3x rise in our traffic,

  • "and you know all of this stuff is happening."

  • And they immediately said, "Oh, well what's going on?"

  • And I said, "All our traffic is 3x,

  • "we're trying to do all these things."

  • And they're like, "Hold on, we've gotta be able

  • "to figure out some way to help you guys out,

  • "'cause this should be kind of."

  • - Right.

  • - And it was literally over that weekend,

  • so thank you for that.

  • And y'all were the first and then that helped

  • I think other corporations to see the value

  • of supporting this.

  • So super appreciate that.

  • I mean there's several really interesting

  • things you touched on.

  • I am intrigued,

  • you know when you mentioned the mortgage deferral.

  • And that does feel like the exact right thing to do

  • when you kind of lead with your heart.

  • 'Cause people are not gonna be able to pay their mortgage

  • for reasons outside of their control right now.

  • But what's the conversation like inside the bank?

  • Because on the other side of that,

  • what does it do to the finances of the bank?

  • What does it do to kind of how those mortgages look,

  • I guess you know if you view them as a financial instrument?

  • How do y'all handle that balance?

  • - Well, I think we learned a lot

  • out of the financial crisis,

  • where we had to apply both humility and tenacity

  • to make our way through that.

  • And as you may recall,

  • there were a lot of foreclosures.

  • There was also a glut of housing on the market.

  • Today it's very different.

  • First of all, this is a health emergency,

  • not a financial crisis.

  • Although the finances of the industry and of the country

  • are certainly gonna suffer here.

  • So the thinking around this was

  • let's see if we can help people to defer payments

  • for a period of time,

  • while the country tries to get back on it's feet.

  • And with the hope that through

  • these Paycheck Protection Programs,

  • through our deferrals,

  • through all that is being done legislatively

  • on a bipartisan basis,

  • that all of that collectively, and most importantly,

  • the kinds of things that Bill Gates

  • was talking about the other day,

  • in terms of coming up

  • with vaccinations and continuing

  • the physical distancing programs until we have that,

  • All of that is to prepare

  • for getting ourselves back in shape.

  • And I have to say that...

  • I talked to our research analysts yesterday.

  • And what they are proposing we're looking at is

  • we've already had an almost 5% downward turn

  • on our GDP for the first quarter,

  • and that quarter was okay until March.

  • It's gonna be quite extreme in the second quarter.

  • But the third quarter looks like it's gonna stabilize.

  • And then we're gonna see a move up in the fourth quarter.

  • If we can apply all that we're talking about,

  • the deferrals, the Paycheck Program,

  • the kinds of activity that the Fed and Treasury

  • are trying to do to keep liquidity in the system,

  • that those companies that are now sort of on the sidelines

  • can come back into business.

  • And that may be well into the summer,

  • but you know we're hopeful.

  • And once that happens,

  • the fundamentals of the economy

  • should in large part come back.

  • It doesn't mean that restaurants that we all know and love

  • aren't gonna go out of business.

  • It doesn't mean that some small businesses

  • will have great difficulty.

  • But it does mean, on balance,

  • that we are more hopeful.

  • Still we see, in aggregate, probably

  • about sort of the ups and downs

  • I just talked about,

  • maybe a 6% downward trend for 2020,

  • and probably about the same up for 2021.

  • - Oh that's super useful.

  • And I wanna encourage everyone who's listening,

  • we have team members who are looking

  • at the message boards on YouTube and Facebook.

  • So feel free to put the questions

  • in that they'd get surfaced to myself and Anne,

  • and I will ask as many of these as I can.

  • Actually I'll start with one of them,

  • and then I have a bunch of questions for Anne.

  • I wanna go a little bit into how she became Anne Finucane,

  • because there's a lot of young people here

  • I think could get inspiration from that.

  • But from YouTube, AndreaR.316 asks,

  • "What are some ways to be money wise during this pandemic?"

  • And maybe I'll extend it, you know, money wise generally.

  • - Well some of the best money wise

  • information and advice we have

  • comes from you, Sal,

  • the work that you do with us in Better Money Habits.

  • And that is it's always good to spend within your means

  • but now you really have to.

  • So there are some benefits right now,

  • I mean interest rates are about zero.

  • So if you don't run up a deficit on your credit card,

  • if you can try to live within your means,

  • that really helps.

  • I would put off big purchases right at the moment.

  • You know mortgage applications are down 40%,

  • that's usually a pretty good bellwether

  • of where we're at as a country.

  • But it's different this time,

  • in that there are also not a lot

  • of houses on the market for sale,

  • so it's not like it was 10 years ago.

  • There is actually very little

  • on the market for sale on a relative basis.

  • So I guess what I would say is,

  • try to live within your means,

  • don't make big purchases if you can help it.

  • We all are traveling less,

  • so our gas bills should be down,

  • obviously oil prices are down.

  • And I think just try to be prudent with the decisions

  • you make in the short term.

  • - Yeah, and what Anne is referring to,

  • we've had a partnership,

  • you know we've both alluded

  • to it over the course of this livestream,

  • for I think it's seven or eight years now.

  • Where back in 2010, 2011, and this when Khan Academy

  • was a very small organization,

  • so I give Bank of America a lot of credit,

  • where they said, "You know we really want to educate folks."

  • And I remember those first conversations

  • with Anne and her team.

  • You know we were a little suspicious of you frankly.

  • You know big bank, we're the small startup.

  • And we said, "Well, you know

  • "we wanna have editorial freedom."

  • They're like, "Of course, you need that editorial freedom."

  • And so we got into that partnership

  • around Better Money Habits and just financial literacy,

  • 'cause I think both sides of us think

  • that this is a key thing.

  • I mean if we were masters of the education system,

  • we would make financial literacy part of that school system,

  • alongside algebra, and American history,

  • and everything else.

  • But I have to say, Anne, you know this has been

  • a really, and I don't think I've actually had

  • a chance to tell you this,

  • I mean the partnership has kind of given me a lot of faith.

  • In that, a lot of the stereotypes folks have

  • about, "Oh, you know big companies."

  • 'Cause from day one y'all have just said,

  • "Well, what do you think is right to tell students?"

  • And you know, in our stuff that we publish together

  • we talk about things, some of the same things

  • that you just alluded to,

  • like pay off your credit card debt as soon as possible,

  • try to pay off your high interest rate type of things,

  • you know leverage your 401K, if there's a match,

  • and all of that type of thing.

  • And this isn't always in the, so to speak,

  • financial interest of financial institutions.

  • But it's because y'all see yourselves

  • as such major actors for society generally,

  • that y'all want this information out there.

  • And you know I found that very rewarding,

  • that at no point did we feel that we're in some way

  • feeling held back in our openness

  • in making sure we're empowering folks.

  • So that I think has been great.

  • And so for anyone who's curious,

  • you can check out Better Money Habits.

  • You can check out the personal finance section

  • on Khan Academy.

  • That's all work that we've done together,

  • because of sponsorship from Bank of America.

  • So there's a question from YouTube, J.R. Foster,

  • and maybe I'll connect this to your life.

  • You know the question is,

  • how can we be leaders during a crisis like this one?

  • And I'm guessing J.R. might be younger,

  • we have a lot of high school students who watch this thing.

  • But maybe you know, how could you be leaders?

  • And I'd love to connect that you know to get to know you,

  • Anne Finucane, a little bit better.

  • You know how did you end up on the trajectory

  • that you are on?

  • How did you end up becoming,

  • you know one of the leaders, the top leaders,

  • in the financial sector globally?

  • - It took a long time (laughs).

  • So you know what, I wanna go back to something

  • that the previous guest asked,

  • and that was about what to do right now.

  • There is something that people can do

  • that's unusual right now,

  • and that is that you can,

  • if you need emergency funds, you can

  • use a percentage of your 401K savings without penalty.

  • So while we wouldn't normally advise that,

  • that is cash that's available to be used, if you need it.

  • How did I become me?

  • Well so I am not really a banker actually.

  • I understand banking but my background was in city politics,

  • and then in broadcasting,

  • to advertising, marketing, and research.

  • And I came to the bank about 25 years ago,

  • actually a predecessor bank,

  • or an acquired bank of Bank of America.

  • And I was brought in because they needed some help

  • given that how many mergers and acquisitions

  • were going on in the financial services industry.

  • And I probably understood the outside world

  • better than I understood the inside of a bank.

  • So I did that work for Fleet Bank,

  • which was a regional bank for New England,

  • and then later for the Northeast.

  • Bank of America acquired us in 2004.

  • And honestly, I didn't think I would stay with the bank.

  • They were headquartered in Charlotte, North Carolina,

  • I'm from Boston.

  • I spend most of my time somewhere

  • between Washington, New York, and Boston.

  • So I had maybe been to Charlotte once or twice,

  • and mostly just to change planes,

  • you know it's a big connecting flight location.

  • So I didn't think it would work out

  • but it did work out.

  • And it worked out because in their acquisition

  • of our company there were questions

  • that were being raised in Washington,

  • by the head of the Financial Services Committee

  • in the House, that was Barney Frank,

  • and by the head of the Senate Banking Committee, Chris Dodd.

  • Luckily for us that they were both from New England.

  • I understood where their issues were.

  • And I think that we were able to ameliorate

  • the kinds of concerns they had about employment,

  • banking practices, et cetera.

  • And I got to know this company better, Bank of America,

  • and I was very impressed with the work they were doing.

  • And that allowed me to maybe show them what I could do.

  • And certainly I was impressed with what the bank was doing.

  • And so we went from there.

  • But as far as the past ones,

  • I think everything's kind of a prologue for your future.

  • You take each thing you have

  • and you try to apply it to the next thing.

  • I didn't understand banking particularly well.

  • Bankers had been my clients but I hadn't been inside a bank.

  • Actually I'd never been inside a large public company,

  • other than a brief time for a company

  • that then dissolved later.

  • So you know you just one thing begets another,

  • you apply what you've learned from the past

  • and you stay where you're happy.

  • So in each of these cases, I've been happy.

  • The bank was probably not something I thought

  • that they would either particularly like me

  • or that I could see myself in a big corporation.

  • But the kinds of things we just talked about earlier,

  • the ability to give what will now be $350 million

  • to worthy causes and actually help.

  • Whether it's food security, or helping with education,

  • or affordable housing, or environmental causes,

  • that's really important stuff

  • and it takes big companies to be able to do that.

  • It takes small operations as well.

  • So when you can combine, that's really important.

  • And the trick is not to overwhelm.

  • So in our case, with Khan Academy,

  • I'll tell you, and I've told you this before over dinner,

  • that the way we came to Khan Academy is

  • I was working with my daughter who had a learning disability

  • and math was particularly difficult for her.

  • So I discovered you,

  • and we started to use

  • Khan Academy for her to relearn some math skills

  • that she was getting rusty on.

  • And it was so good that I thought,

  • "Well, we're supposed to do financial literacy,

  • "and some of what we've got is kind of boring,

  • "and I wouldn't watch it myself."

  • Which is always a pretty good bellwether

  • for whether it's good or not,

  • would you watch something yourself?

  • And I'd been watching what you did and I thought,

  • "Could we get you to come in and help us

  • "figure out how to talk to people?"

  • And the first video you did for us was

  • The Anatomy of a Paycheck.

  • And it was very, very successful

  • because who doesn't wanna know,

  • your first job let's just say,

  • you think you're going to be making $500 a week.

  • And you look at your check and it's $275,

  • what happened to my money?

  • So the ability to take people through

  • what each of those deductions are,

  • and what they mean,

  • and whether you'll ever see it again,

  • I thought was so terrific.

  • And we had millions of views of that.

  • So if I thought it was gonna work,

  • that first video told us it was a home run.

  • - No, well thanks for that.

  • And you know I think your journey,

  • I wanna maybe double click on it a little bit,

  • and it'll maybe make you feel a little bit awkward

  • 'cause it's sometimes tough talking about yourself

  • or your own strengths.

  • But clearly there's something,

  • you know you've kind of said,

  • "Well you know I was a bit of an outsider.

  • "I came to a bank 25 years ago,

  • "and you know good things happened.

  • "You know I like it here

  • "and now I'm vice chair of the bank."

  • What traits did you bring to the table,

  • that actually maybe aren't even as obvious

  • or as intuitive for young people out there,

  • that allowed you to thrive?

  • What people saw in you that,

  • were they always you know,

  • when there was an opportunity for more leadership,

  • they essentially said,

  • "Hey, we think that's a job for Anne Finucane"?

  • - Yeah, actually I don't think it went that way.

  • I'm usually not like the immediate thought

  • because I am little bit of an outsider.

  • But I'm a lifelong learner,

  • I am curious, I enjoy other people.

  • So I'm perfectly willing to absorb your knowledge

  • and then see if I can apply mine to it,

  • and see if we can get to something better.

  • So I think that makes a difference.

  • And over time I don't like crisis,

  • and we've had plenty of them.

  • So in mergers and acquisitions

  • that sort of feels like a very acute moment,

  • and that probably is for me when I'm at my best.

  • So maybe that means I'm a little flaky otherwise,

  • but I like being able

  • to apply lots of thinking,

  • lots of reading, I read all the time.

  • The experiences that I've had and others,

  • try to aggregate it.

  • Take complicated things and simplify them

  • and let's see if we can make them better.

  • And like I said,

  • I enjoy working on a team.

  • And I believe in creativity,

  • and I believe creativity doesn't come from one source.

  • I think it comes in all different manners

  • and from all different people.

  • - Yeah, yep, and I mean well I think

  • one of the interesting things you said,

  • which I think it definitely resonates,

  • is in a time of crisis I think people are realizing,

  • and that's when you get to see people

  • and who they really are,

  • and I think people have probably seen something in you,

  • your ability to handle that well.

  • And I mean related to that,

  • this is actually J.R. Foster is asking

  • a lot of good questions from YouTube,

  • "What are some leadership skills

  • "that you've developed over the years,

  • "that you know they might not teach

  • "in business school, so to speak?"

  • - Read, I think that's a very underrated skill, read.

  • And it turns out a lot of people don't read.

  • And then read broadly.

  • I mean read the news of the day, read literature.

  • Try to pursue what you may not be particularly good at.

  • I'm not very good at science but I think it's interesting,

  • and I read about science and medical issues.

  • So it's the ability to have the humility to read and learn

  • what you're not particularly good at,

  • and combine it with what you like.

  • So I think that's huge, reading.

  • Listening, I think listening is way underrated.

  • And as it turns out,

  • the further up the food chain you go

  • the less people seem to listen.

  • So if you're not the one always talking,

  • and you're listening, and you've been reading,

  • and you can aggregate a lot of information,

  • and you can simplify it,

  • those are leadership skills I don't think anybody teaches,

  • but for me, they've been what's gotten me through.

  • - That's very powerful.

  • On the equity side of things, from Facebook,

  • we have this question from Kristine Xu asking,

  • "How are you, and the team at Bank of America,

  • "thinking about issues of equity in regards

  • "to access to capital that have been

  • "potentially exacerbated by this crisis?

  • "Thank you for your time."

  • - Well, I think this Paycheck Program

  • is a pretty good example of it.

  • If 98% of the people that can get this small business loan

  • are small businesses that have under 100 people,

  • that is an important step

  • to making sure you're repairing the country,

  • because that is what America looks like,

  • small businesses with under 100 people.

  • So I think it's important that,

  • on this program by the way,

  • that the money runs out when the need runs out.

  • And we've had two triages,

  • the first one was for $350 billion,

  • that money ran out in two weeks.

  • This new one that went online yesterday,

  • at $310 billion, is gonna run out.

  • And I think that Congress has to reallocate more money

  • until everybody has been served

  • and we can get businesses,

  • so the idea is that you are able to pay people

  • the next 2 1/2 to three months,

  • while you may not be able to actually run your businesses.

  • So when that point comes when you can go back to work,

  • or reopen your business,

  • the individuals that have been working for you

  • have been paid along the way.

  • So it's 75% a paycheck,

  • and like 25% is rent or mortgage,

  • or the kinds of things, the overhead,

  • that you would have for that.

  • That's one way of thinking of it.

  • The other is to always try to be fair in your fees,

  • to try to have programs like Better Money Habits,

  • where you're literally trying to educate people

  • on how to improve their FICO score, rent versus buy,

  • what kind of mortgages might be available to people

  • versus for first-time buyers, et cetera.

  • So you know we are the largest consumer bank in the country.

  • We're the second largest bank,

  • but the largest in terms of we're the largest

  • small business lender, for instance.

  • We have a very big portfolio in the LMI community,

  • meaning the low-to-moderate income communities.

  • And that's evaluated by the government and everyone else,

  • so we have an outstanding rating

  • from the government on that.

  • And it's being good at those programs.

  • I think we were very good at them for many years.

  • I think the financial crisis

  • was not only a low point for the country,

  • but a low point for Bank of America.

  • I think we took that in,

  • I think we were chastened by it,

  • we made many changes in the bank.

  • Whether it's from the really prosaic things

  • like looking at fees and services,

  • to what we were to offer in terms of lines of business,

  • not having overdrafts...

  • At point-of-sale.

  • So just trying to do everything you can think of.

  • Like laying out everything you do as a company

  • and saying, "Is this fair?"

  • So we still need to make money.

  • Credit cards are not free,

  • there are interest rates that go with them.

  • If you write a bunch of checks

  • and they're you know all overdrafts,

  • you will pay for that.

  • If you don't have the money to pay

  • for something at a point-of-sale,

  • you know it won't be able to be bought

  • because you don't wanna take that overdraft charge.

  • You don't wanna keep running up bills

  • that you can't afford to pay.

  • - Right, and I think it's an important--

  • - So those are some of the things that we're doing.

  • - Yeah, no, no. - Sorry.

  • - That's incredible.

  • And no, no, I mean it's amazing

  • how many questions are coming through.

  • And whenever we're having a good conversation

  • the time seems to go incredibly fast.

  • If you have a couple of minutes,

  • I mean there's a lot of questions.

  • People are obviously curious about the economy itself,

  • and you have a very unique vantage point.

  • And you have from Facebook, Marta Wyngaard,

  • "Is this a crazy time to buy a house?"

  • Krish Shah, from YouTube,

  • "Should we be investing in the market,

  • "since the markets are down?"

  • Morakinyo Olugbile,

  • "Is this a good time to refinance a mortgage?"

  • So that all goes into this category of you know

  • people are just you know should you freeze,

  • should you act, should you just wait for things to play out?

  • What are the scenarios of how this economy might play out?

  • You talked about it a little bit.

  • Sounds like you're expecting hopefully some normalization

  • in the back half of this year.

  • - Yeah, fourth quarter is probably the beginning

  • of the normalization.

  • So you know first of all,

  • because it's a health crisis it's very hard to predict

  • when the states will open,

  • when the cities will open,

  • and therefore, when the businesses will open,

  • so we're kind of following along.

  • But presuming that, we're looking at

  • at least some of business opening,

  • and I'm talking about small businesses,

  • opening in the summer

  • and perhaps schools opening in September.

  • We do see normalization, of some sort,

  • in the fourth quarter.

  • And then, as I said, in 2021 we see things improving.

  • So overall down in 2020 at about 6%,

  • and about the same up in 2021.

  • So is it a good time to buy a house?

  • Well it's a good time to buy a house

  • if you already have a house in mind,

  • you have the down payment,

  • you are still employed,

  • you think you will be employed.

  • So if all of those things are in place,

  • it's a good time to buy a house.

  • It's not a good time to buy a house

  • if you didn't have all that in place

  • and you just think,

  • "Wow, maybe it would be a good time to buy a house."

  • Because housing prices, the theory would be

  • that housing prices will go down.

  • They might go down a little bit,

  • but I said earlier something that's unusual,

  • which is there's not a big glut

  • of available houses on the market,

  • and that's when they really go down.

  • So might there be a reduction in housing prices?

  • Yes, because someone may wanna sell their house

  • because they already wanted to sell their house.

  • But I don't think it will be pervasive.

  • Another question was about the market, buy or sell now?

  • Well you wouldn't sell in a down market

  • if you can help it, that's for sure.

  • And I listened to Mellody yesterday

  • on buying when the market is down.

  • I don't give investment advice,

  • so I don't think I should start now.

  • Other than to say,

  • I still say live within your means.

  • I don't do too much myself in the middle of a crisis,

  • in terms of buying or selling,

  • and I guess I wouldn't recommend it.

  • - Yeah, and I'll just triply underline

  • your live within the means.

  • I grew up in a household,

  • you know we used to reuse paper towels,

  • and I actually only later learned

  • that wasn't normal behavior.

  • We used to always dry out our paper towels after using it,

  • 'cause you know my mom made

  • maybe $16,000 a year as a cashier.

  • But that lesson, I think if you have

  • that kind of financial resilience,

  • it pays a lot of dividends well beyond timing the market,

  • or getting in on some amazing investment opportunity.

  • That's great if that happens,

  • but it's really about what you, yeah.

  • - I'll tell something I am thinking about,

  • which is we have been working very hard

  • on the Sustainable Development Goals

  • for the last several years.

  • And I don't want other companies,

  • or our company, and we won't,

  • lose sight of the importance of that.

  • So we're the largest underwriter of green bonds,

  • we're a big issuer of green bonds.

  • And green bonds are like municipal bonds,

  • they're kind of boring.

  • They pay a low interest rate

  • but they have very low volatility.

  • And the idea behind a green bond

  • versus a municipal bond is that,

  • at the end of the duration of the bond

  • you have to demonstrate that it did some environmental good.

  • So just to use a truly prosaic example

  • is the City of Los Angeles.

  • A bond was issued for them

  • to change over their lighting to LED lighting,

  • and this is a few years ago.

  • Now that's, okay, that's a good thing to do.

  • But in doing it they lowered their energy bill

  • and they were able to pay the bond off kind of easily,

  • because actually, in the longer term,

  • their electricity bills are lowered,

  • it's better for the environment.

  • And that kind of innovative thinking,

  • we don't wanna lose sight of that in a time like that,

  • and that sometimes happens.

  • But I don't think it will this time.

  • It's kind of in the DNA I think

  • of Americans to start thinking about this.

  • So we're thinking about it

  • and not losing sight of how to help on affordable housing,

  • or how to help on the environment,

  • or how to help on education.

  • Because these things will be here six months from now,

  • two years from now,

  • and there will be a vaccine at some point,

  • people will be vaccinated,

  • there will be remedies for this.

  • And these larger, big, issues don't go away.

  • And unless we continue and invest in them

  • they only will worsen.

  • - Yeah, and maybe related to that,

  • just to finish off on a high note.

  • Obviously, this is a strange time

  • for the whole planet right now.

  • There's a lot of bad news out there

  • on the healthcare front, on the economic front.

  • You know dream a little bit,

  • could there potentially be some silver linings?

  • Could there be some things that we come out of this crisis

  • maybe a little bit better than when we went in?

  • Any ideas on your side?

  • - Yeah, I have a lot of thoughts around that.

  • First of all, I think people are,

  • you know many people are working from home.

  • So the ability to sort of engage with your family

  • in a way that you have,

  • and for a long time, is really important.

  • And also an appreciation for those people

  • that are not working at home,

  • that are on the front lines in a critical job.

  • I mean the people that we have in the banking centers,

  • whether we're making sure they have protection,

  • and gloves, and masks, and bringing in their lunch to them,

  • and that sort of thing.

  • You just start to appreciate

  • those people that are on the front line.

  • And I think about the medical community

  • and all they're doing.

  • I think sometimes with take these things for granted,

  • doctors, nurses, EMTs,

  • we don't take them for granted anymore.

  • In the same way that you didn't take

  • firefighters and the police after 9/11,

  • you looked at people differently.

  • I think this is an opportunity

  • to look at things differently.

  • Obviously because we are driving less the use of...

  • Cars on the road has been reduced,

  • so there's been a little bit of,

  • if even it's even incremental improvement,

  • in greenhouse gas emissions.

  • So those are a couple of good things

  • that I think are worth noting.

  • - Yeah, no I think that's a great one.

  • And that first one that's alluding to maybe

  • we all feel a little bit more gratitude

  • for those around us,

  • and a gratitude for what we've had,

  • and maybe what we still have,

  • that even though things are tough

  • and very tough for a lot of folks.

  • Well, Anne, thank you so much.

  • This was you know a really fun conversation.

  • I hope you're willing to do this again.

  • There's so many questions here,

  • it would be nice to draw down that backlog at some point.

  • But thank you so much.

  • And thank you for being such an incredible supporter

  • for Khan Academy through the years,

  • around financial literacy

  • and especially through this crisis.

  • - Well, Sal, thank you.

  • And thank you for all you do.

  • You know you've been a great partner for us

  • for the last several years.

  • As I mentioned earlier,

  • your videos have actually changed

  • how we think about financial literacy.

  • And actually what we think about what people wanna know.

  • So we look forward to continuation with you as a partner

  • and all that you're doing.

  • And thank you for everybody that tuned in today.

  • - Thanks, Anne.

  • So I just wanna say-- - Take care.

  • - Thank you everyone for joining.

  • That was another super fun conversation

  • with someone that I've, as I mentioned,

  • view as a mentor and really look up to

  • and have learned a lot from.

  • And hopefully I think y'all have

  • gotten a lot from her as well.

  • Stay safe, stay healthy.

  • I will see everyone tomorrow.

  • And remember, we are not-for-profit.

  • If you're in a position to do so,

  • please think about making a donation

  • to Khan Academy so that we can support

  • many tens of millions,

  • or actually hundreds of millions,

  • of learners around the world.

  • Thank you so much.

- Hi, everyone, Sal Khan here, from Khan Academy.

Subtitles and vocabulary

Click the word to look it up Click the word to find further inforamtion about it