Nvidia's Leadership Crisis, US Retirement Gets a C+ & Anthropic's Big Debut Next Week

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1:12Ed Morse: This is the Bloomberg Money Podcast. I'm Tom Keen with Scarlet Fu. Join us each week for a smart look at the forces shaping your financial life on personal finance, on retirement, and wealth management. We will explore how people are earning, investing, and building wealth. We are live Fridays at noon Eastern on Bloomberg Television. Subscribe to the podcast wherever you listen. And as always, on the Bloomberg Terminal and the Bloomberg Business App.

1:54Ed Morse: Good afternoon, everyone. Bloomberg Money. What a week it has been. Today on personal finance and retirement, on wealth management, Scarlett Fu and Tom Kane. And Scarlett Fu looked at the week and she said, I'm not doing this. I think she called in like, talk about work from home. scarlet food work from home today we'll have her here next week with all of her great work we say again good noon and some wonderful conversations coming up today we have a special treat edward morse will join us from heart tree partners absolutely definitive worldwide on hydrocarbons on energy and their international relations this is a true treat as oil has come down recently.

2:35Ed Morse: He nailed a lower oil price not too long ago. And important, it is a blistering PowerPoint from ours. Christine Mahoney on the failure of the American retirement system. There's no other way to put it. Carol Mast and I were talking earlier, we're never going to retire. So let's do this. This has been a hellacious week. We had like 15, 20 people to talk to. And here are the three chosen few. Sarah Fryer is with us, of course, driving all of our technology coverage definitive on Instagram. We could do the whole conversation with her. But Carol Masters said, no, I want in as well with the blur of your week, with your programming in the afternoon.

3:17Ed Morse: And Eric Belchunas, his book agent, called up and said, you've got to give him airtime, Belchunas, out with a new book. Let me go right to that, Eric, to start with. It's a celebration of a new book, but it's not ETFs, right?

3:29Christine Mahoney: No, it's my third book. I wrote about ETFs and then Bogle and Vanguard and then Bitcoin crypto. The Bitcoin ETFs, they're kind of struggling lately, but they were the most successful launch. And I felt that the ETF was kind of in between these two worlds. You know, the ETF bridged the DeFi world and the TradFi world. And the ETF kind of is in the middle of the sort of merger of these two worlds, whether it's Bitcoin as a store of value or tokenization as a sort of new financial rails. This is an interesting, fascinating topic. The price action, not the greatest to launch a book, to have a book come out, I will admit.

4:03Christine Mahoney: But honestly, it's better now than it was$125 ,000.

4:06Ed Morse: Okay, but let me cut to the chase. For Bloomberg money, somebody in a retirement plan or whatever, with all your work and your excellence on ETFs, is Bitcoin an investment or a speculation?

4:18Christine Mahoney: It's a little of both. We really, we come down, we call it teenager gold. It has all the properties of gold. What could go wrong with a name like that? I know, right? Well, it's 18 years old. I don't know. I have a 15-year-old. He's very volatile. You're unpredictable. But it has all the traits of gold, and it's been through seven 50 % drawdowns. That alone, I think you have to respect as an asset. We don't have to invest in it. We have to give you both sides. But just the resilience of this thing, I think you have to be like, it's a toolbox if you want it.

4:47Ed Morse: We're doing everything I can not to talk about in video. We'll get to Fry in a moment. Speaking of teenage gold, are teenagers, are they just too young to wear Cartier? What do you think? I mean, what do you do when the daughter comes home and says, you know, Susie has a Cartier bracelet? Go get a job, honey.

5:05Christine Mahoney: No, I mean, mine is a 23 year old. She is at working. She's learning the value of money. And man, does she know how to save it? Like when I'm like, well, you know, if you need to buy something, she's like, well, can you get it? Or if she's going to spend her money, she's like, no, I think I'll save my money.

5:17Ed Morse: In your nuts week, what stands out here in technology?

5:22Christine Mahoney: What stands out? Nvidia, I think there's still so many questions. I think we need to know how much within what was going on was known within the company. I think we need to know from the government side how much they were aware of the relationship. What, if any, secrets were known. It's a different company without Jensen Wong.

5:41Ed Morse: We drag ourselves over to the story of the week on Bloomberg Money. Sarah Fryer has been in the Denny's in San Jose with a founded Nvidia, which makes you qualified. I have such a respect for your holistic view here. Just your single thought to get to Monday on this hellacious, complex story.

5:59Christine Mahoney: Well, I think a lot of people are looking at this story and calling it an affair scandal, right? The two, maybe three affairs that he's reportedly had. This is so much. And I think you got at the heart of it right there, Carol. This is about U.S.-China relations. And this is about to what extent Jensen Wang was was tapped as a resource to get to Trump to understand what's happening in the U.S. government. You know, how was he implicated in this? And what did NVIDIA do with its chips that ended up in China? We had a great scoop just a few hours ago that some of the NVIDIA chips that went to Singapore did make their way to Shanghai to a company that had ties to Alice Wong.

6:44Christine Mahoney: Oh, come on, you're underselling it.

6:46Ed Morse: Andy Lin pulls an all-nighter in Hong Kong, and we have this story of the chips to Singapore and then up to Shanghai. is Peggy Noonan said in the journal, this is like Teapot Dome, or maybe it's almost Watergate. Do you perceive it? Is that big a deal?

7:01Christine Mahoney: We have seen evidence of this, by the way, for a while now. Mackenzie Hawkins on our team has really been scooping a lot of this NVIDIA chip question. What is this mystery amount of chips that they can't account for? The company has said, you know, there's nothing happening that's out of the ordinary. These chips are in Singapore. We found evidence that that they are not that they were in China. So so I think that that is really at the heart of this. And I think I've heard a lot of Silicon Valley people saying, well, you know, other CEOs are allowed to have affairs. You know, it happens. And he's so integral to the A.I.

7:40Christine Mahoney: boom. When when we're talking about the deal making in A.I., it is.

7:45Ed Morse: I'll choose that he wouldn't come on unless I did breaking news. I'm a Kodak brat. OK. René Haas was a Xerox brat. OK, same culture, Western New York. And he's at arm, is it? And he's one of the CEO possibilities. Do you have in your head an idea of who could do this with NVIDIA?

8:04Christine Mahoney: You know, it's a secret sauce that I think is going to be very difficult for an outsider. You know, you need somebody that has the charisma, that has the connections. A lot of a lot of these deals that Jensen Wong did were just personally done. You know, he had 60 people reporting to him. He was the one doing the final sign off on all of these. All of these arrangements with cuts. So when you bring someone in, they also have to have connections.

8:33Ed Morse: OK, I got to make money at this. Eric, tell me about double, triple leveraged NVIDIA ETFs today. How was their week?

8:40Christine Mahoney: Yeah. NVDL is the 2x NVIDIA ETF and people are buying it. They bought it for three, four straight days. It keeps going down. The traders love to buy dips and they got a big one in NVIDIA. The rest of the ETF world is kind of business as usual. I'm looking at the S &P 500 over the past week. It's up three percent. NVIDIA is down nine percent over the past month. S &P is flat. NVIDIA is down 18. This is why we say indexing is a team sport. You can have one stock kind of blow up a little bit and the index move on. So a lot of the Vanguardians, they're just like investing as usual. The trader, the degens, they are buying the dip for now.

9:14Christine Mahoney: A little more pain, we'll see. But right now, they think it's going to snap back.

9:17Ed Morse: What Carol and I live every day on our shows is fear of missing out. You were just in Asia for, what was it, like an eight-week soldier? I think he milked it. Where was he? It felt like eight weeks. Red O 'Age, the American Express card was, you know, multiple digits there. What did you learn in Asia about fear of missing out?

9:36Christine Mahoney: Yeah, so there's so much gambling. They love gambling there. The degengine is big there. Europe has none of it. We have a lot of it. So Asia and U.S. both like to gamble. But there, they don't have the Vanguard thing. They're either in expensive mutual funds or they're like investing in real estate or they gamble. So they don't have independent advisors. I think that's one thing that you take for granted. Can they get there? Possibly. You have to have these brokers have a crisis of consciousness and be like, I can't keep putting my client in this awful fund. There are better ways.

10:06Ed Morse: Just to interrupt, Jamie Dimon is going to be speaking with Dario of Anthropic. That's next week's show. OK, can our banks go there? Can JP Morgan go into Asia? Yeah, absolutely.

10:18Christine Mahoney: And a lot of the big banks and wire houses, they've already gone into an independent advisor model, which is to get a percentage of the client assets as opposed to commissions. Commissions from mutual funds are all over the world, but not in the U.S. We've moved out of that. And it's better for the investor because the advisor is going to pick something.

10:34Ed Morse: See how he brings it back to Bloomberg money? He's pretty amazing. He's gifted.

10:37Christine Mahoney: If I may, though, investors, there's a story in the Bloomberg institutional investors based in mainland China and Hong Kong have been excluded from placing orders in Anthropics IPO, according to folks in the know. So there are things that they're not going to get access. And this has to do with what's going on in terms of. Do you have or so it's believed? Let me add one thing to this. The government's rule. I mean, the Chinese government just buys stocks when they're down. I mean, they go down, they just buy them. They bought two billion dollars a day in the equity ETFs. Japan, they've bought stocks there.

11:08Christine Mahoney: I think it's a little glimpse into our future. It's a hot take. I think down the road, our government will buy stocks. They're in the controlling mind.

11:14Ed Morse: Does Carol Masser know we have commercials?

11:16Christine Mahoney: They bought Intel. We blow. I got to go.

11:19Ed Morse: Sarah Fryer, come back. You know. Carol Masser, thank you. Eric, nice to have you back from Asia as well. Coming up, this is a huge treat for Bloomberg money. Edward Morse, definitive at Citigroup on the linkage of international relations into the price of a barrel of oil. He nailed lower oil prices before a war in the Middle East. Ed Morse next. It's Bloomberg Money. I'm crushed. I never can walk. You're listening to Bloomberg Money. Stay with us with more to come after this.

11:53Christine Mahoney: When you own your own business, you own every decision. Catch the red eye or take the 6 a.m. Make a new hire or promote internally. Celebrate a win with the toast at the gate or unwind at the lounge. Big props to this team. Some decisions are a win-win, like earning eight times points on Chase Travel. Chase Sapphire Reserve for Business, the business card that gives back all you put in. Visit chase.com slash reserve business to learn more. Cards issued by JPMorgan Chase Bank, any member of DIC, subject to credit approval. Terms apply. Your business operates under pressure and you need control over your data.

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13:10Christine Mahoney: There's a better way. Try Wise. Wise uses the exchange rate you'd usually find on Google, helping you avoid the unwelcome surprises that often come with international transfers. Whether you're sending money to family overseas, spending while on your holiday abroad, or paying bills across borders, Wise makes moving money simple, transparent, and straightforward. Wise offers 24-7 customer service and runs over 7 million daily checks to spot and stop fraud. And most transfers happen in under 20 seconds, which means your money arrives in less time than you've been listening to me. Join millions, saving billions.

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13:58Ed Morse: Bloomberg Money, we say on personal finance, on retirement, on wealth management. And of course, all of that centered around the recent memory of Brent Crude at$117 a barrel. We're watching some news here right now. Market recovering a little bit off of where we were at the top of the show. Joining us is Edward Morse with Hartree Partners, their senior advisor, dabbles in commodities and, of course, definitive at Citigroup years ago. and he's delightfully 79 in holding. Thank you so much for coming in today. Do you remember the first OPEC crisis? I don't know if you were at State Department then, but how did you and your family react to price of oil exploding from whatever$15 or$20 a barrel?

14:44Christine Mahoney: I was teaching at the time, and I was teaching a course on international political economy, and I never thought about talking about oil, and here we had a 400 % increase in the price of oil. Our car had been under repair and was stolen from the parking lot at the dealership. And we were scrambling as prices were rising to find an inexpensive car.

15:08Ed Morse: So you bought a VW diesel like the rest of America.

15:12Christine Mahoney: That's a long story, but we bought a not expensive car.

15:18Ed Morse: I mean, everybody had to adapt then. Now we have a war, an unimaginable shutdown of a strait in the Middle East and the Persian at Gough. And we seem to be going through this, except for the military people at risk. We seem to be going through this much calmer than we did in OPEC 1, OPEC 2, up to 86.

15:39Christine Mahoney: It's a lot calmer, and it depends on where you are and who you are. But it's calmer for the world. And I think there's one thing we have to bear in mind when the early 70s crises took place. The oil intensity of GDP for the world was growing. It was actually growing at a phenomenal rate. We had highways being built around the world after World War II. We had intercontinental highways being built across the U.S. And oil demand was growing mostly as a transport fuel at a faster pace than GDP. GDP was growing at maybe 4 % for the world as a whole. and oil demand was growing at 6%. And we're now in a world where the oil intensity of GDP is falling.

16:21Christine Mahoney: And that was where my remarks were. Don't worry this time around as much as last time. Can you then explain? When you get lower intensity of oil, then we're not going to see the price shot. Well, that is the case.

16:32Ed Morse: But David Gurr is going to be with us later off the election. In the election, I'm sorry, it was still a gallon of gas at Morse. America's wedded to a gallon of gas. and yet you're telling me our intensity isn't there like it used to be. Are you surprised how we're wedded to what the price of a gallon is?

16:51Christine Mahoney: I'm not surprised because, you know, Americans like others in the advanced economies of the world are living in a very inflationary environment. Oil is part of that inflationary environment. Other commodities are part of it as well. And the cost of living is growing for most of the population at a faster rate than wages are growing.

17:12Ed Morse: I want to go to your great call here. bring up the chart if you would. I had to go back. I had to impress Ed Morse here. This is Arab light back to the 1950s with the first boom and the first OPEC boom as well. That's 70 years of oil. And the red bracket down at the bottom is the great Ed Morse call that oil would fall down before the war into the 40s and 50s. That was a lonely call. If we get out of this war in one piece? Can we get back to an Ed Morse$50 a barrel?

17:42Christine Mahoney: We can, whether we do or not is an open question. And the reason I say we can is that the world now is very different from the world then. It's not insignificant that the UAE said we're no longer being members of OPEC. It's not insignificant that OPEC at one point could really control prices and really put a floor under them or keep a ceiling to it. But OPEC's role in the world of oil and liquids is really insignificant. It's now, you know, in the 30 million barrel a day range in a world where you look at total liquid consumption, it's 110 million barrels a day. So, you know, OPEC doesn't count much.

18:22Christine Mahoney: And when you get two large players, and I'd say there are two, because Iraq, very much like the UAE, is saying, hey, we're not going to be hampered by how much we grow. that as well as not going to be hampered by how much we grow. They are countries that have a very low price in order to produce. And they don't care if the price is 40.

18:44Ed Morse: I got eight ways to go here with you. And I've got a two hour interview, folks, here on Bloomberg Money with Ed Morse. China's the elephant in the room. And the great thing we've learned at Bloomberg is the pollution in China seems to be real. If you take the work of Elizabeth Economy on coal, on China, on pollution, and you drag it forward. Where is China in the Edmars world in five years?

19:08Christine Mahoney: China is not where it is today in the next five years. And you can see it today, depending on where you're looking. China has this incredible advantage in that when it joined the International Monetary Fund as a donor, when it became a more advanced economy, the deal they struck with them is that the IMF is going to use China's official numbers on what their GDP is. So China now claims that their GDP is rising at 4.6 percent year to date. There is no way in the world China's GDP is growing at that rate. You take and you've interviewed people from the Rhodium Group. Rhodium Group says that year to date, Chinese GDP growth has been zero.

19:49Ed Morse: Yes.

19:50Christine Mahoney: And and not only has it been zero, but the internal mechanisms in the country are failing.

19:56Ed Morse: This is perfect. It's a retirement show and you refuse to retire. I think it looks great. We're going to come back with Ed Morrison and talk about America's retirement system, all that it means within our personal finance as well. Ed Morrison's with a hard tree. It's Bloomberg Money.

20:30Christine Mahoney: at the gate or unwind at the lounge. Big props to this team. Some decisions are a win-win, like earning eight times points on Chase Travel. Chase Sapphire Reserve for Business, the business card that gives back all you put in. Visit chase.com slash reserve business to learn more. Cards issued by JPMorgan Chase Bank, any member of DIC, subject to credit approval. Terms apply. Running a business means keeping pace with the latest tech. You've put a lot into building your enterprise software stack and scrapping it to integrate AI is out of the question. That's why IBM technology works with all the apps, data, and models you need.

21:09Christine Mahoney: It's another way IBM helps you build on the technology you rely on. Let's create smarter business. IBM. Visit ibm.com to learn more.

21:22Christine Mahoney: Wise is the smart way to manage the currencies you need around the globe. If you've ever sent money internationally using a traditional bank, there's a good chance you've paid more than you realized. Hidden fees, exchange rate markups, and extra charges can quietly add up before your money even arrives. There's a better way. Try Wise. Wise uses the exchange rate you'd usually find on Google, helping you avoid the unwelcome surprises that often come with international transfers. Whether you're sending money to family overseas, spending while on your holiday abroad, or paying bills across borders, Wise makes moving money simple, transparent, and straightforward.

21:58Christine Mahoney: Wise offers 24-7 customer service and runs over 7 million daily checks to spot and stop fraud. And most transfers happen in under 20 seconds, which means your money arrives in less time than you've been listening to me. Join millions, saving billions. Be smart. Get Wise. Visit wise.com or download the Wise app today. T's and C's apply.

22:26Ed Morse: Bloomberg Money. We welcome all of you here on personal finance and wealth management and on non-retirement. Edward Morse with us today with Hartree, Citigroup, Definitive Lehman and Credit Suisse with all of your work on international relations. What's it like not to retire? Explain that to Americans focused on age 65.

22:50Christine Mahoney: Well, it means that when I wake up in the morning, I have to read the newspapers, I have to get on the air, and I have to agitate my mind. And I've got used to doing that, and I don't want to not do that.

23:03Ed Morse: It's such an advantage, I would suggest, and yet so many Americans are being forced to extend out their working years because they can't retire. With all of your work in the academics of finance, how did we get here with such a failed retirement system?

23:20Christine Mahoney: Well, our retirement system has done a lot better than a lot of other retirement systems. So it's hard to do a retirement system right. And it's particularly hard to get the demographics right for the country. I mean, we are in the U.S. in a much better position than Japan or Korea or China even. And China, we talked about that a little bit earlier. China's got this tremendous difficulty in which the age population does not have a pension system. They do not have a health system. The younger generation has to work in order to pay for the adults who are no longer able to work. And what we're seeing in the country is they have the one child per family, and that they try to change.

24:06Christine Mahoney: But they have a divorce rate that's growing at a faster rate than their marriage rate. And they are in deep trouble when you think about how they're going to support an older population. We at least have a choice. And we have a choice in terms of providing an opening for immigrants to come to the country. And if we were looking at financing the pension system, that ought to be a part of it.

24:28Ed Morse: What's your advice with all the decades, Ed Morse, of the misallocation towards retirement? How would you allocate a retirement plan today for a young brat 30 years old?

24:41Christine Mahoney: I don't know how to answer that. I think the young brat who's, whether they're 22 or 35, really has to understand that they need to put money away in order to have money there when they need it. Do they need equities or bonds? It's equities and bonds. And bonds. Yes, and you have to have a good advisor pointing you in the right direction because there's so many things that are misleading. And the main thing that is misleading at this moment is that we're from the energy side in a world moving to a higher electricity intensity of GDP. And the sources of electric power, you know, are very controversial because some of them are fossil fuels.

25:23Christine Mahoney: Some of them are not. And it's going to be a difficult episode to get through. But where you invest on the equity side or on the bond side, it's going to be a function of how that energy intensity works. There are some equities that are going to be screamingly perfect to look at.

25:42Ed Morse: This has been fabulous. Let's do it again. Ed Morris, thank you so much with Hartree here on A Gallon of Gas. Skylar Fu on deep assignment today. Something about work from home. We hope she has a wonderful, wonderful three-day weekend. It's on personal finance, on retirement, on wealth management. Can't do that if stocks are going down. Let's look at the stock market right now. And it is going down here on a Friday. It is sort of given the shock of NVIDIA. We're slipping into the weekend, but NASDAQ down 1.6%. We had VIX above 20, maybe 20 is a new 30. I'm not sure on that, but at 19.77, that shows the tension that we've seen this week.

26:22Ed Morse: Here's where the story is for next week, Exanthropic. and we'll focus on that here at the back end of this half hour. Dollar 103 DXY is a huge, ginormous deal. I can't say enough about how yen at 160 gets everyone's attention worldwide. And you see DXY at 103 yields up as well as we get to the December 9th Fed meeting. Okay, so it is, you know, personal finance and all that. But it's also every once in a while a story that comes out. It's just great. And, of course, here it's a cross-platform effort here at digitalhubatbloomberg.com slash money. This week, of course, there were some great stories.

27:04Ed Morse: Sarah Foster steps in right now. Your story on the couple from Staten Island was extraordinary. What you've done is away from the suits and bow ties, you actually talked to real people about affordability. What was the one insight? you learned?

27:20Christine Mahoney: I think what's really interesting about Staten Island is it's kind of like this window to a lot of economic narratives that we've heard that really were amplified throughout the election. I met a woman who was laid off from her job as a software engineer. I met a couple who sold their car to lower their gas bills. I met a retiree who went back to work because of affordability issues. And I think what's really clear is that a lot of this pessimism about Americans' finances is really kind of the main narrative around the midterm elections.

27:48Ed Morse: I got David Gurra coming up and we'll talk about the election and all that. Let's flip that on its head. What do those people want from the politicians and the upheaval they just created November 3rd?

27:58Christine Mahoney: I think it's really difficult for a lot of them to answer that question. They, of course, would like to see more worker protections. You know, I think coming out of the coronavirus pandemic, when they got those amped up stimulus checks and employment benefits, a lot of them kind of wish that you had that same kind of safety net in a massive job market upheaval from AI for entry level opportunities. And then, of course, there's a lot of people who are not really hopeful that Congress can do much to fix these issues. Well, your last sentence of your article was jaw-dropping about this dearth of hope.

28:32Ed Morse: It was extraordinary. Discuss that just quickly here.

28:35Christine Mahoney: Yeah, I think hope is really hard for a lot of these, especially young people, to feel right now when they've taken all the steps that they were told to take and still kind of feel like they're left behind.

28:45Ed Morse: It's an hugely emotional article. Sarah Foster, thank you so much for that. On affordability in the trenches, not with the fancy people in Washington, New York, or other climes. Every once in a while, you get a PowerPoint that comes across. I hate PowerPoints, just as a general statement, where you just stop. Of course, I noticed it because CFA Institute was on there. Good morning to all of you worldwide. But more importantly, Marsh was on there. There's a heritage there I'm not going to go into. It's like it's a soap opera of spectacular consultancy over 40 years. Christine Mahoney, Marsh Global Defined Benefit, Defined Contribution leader is with us.

29:25Ed Morse: Why is your PowerPoint so emotional? I was shocked about the United States, not in last place, but flunking with a C plus or a quality C.

29:36Christine Mahoney: I think it's shocking. And we do it intentionally when you rate people, when you put them up and down, You give them an A, you give them a B, you give them a C. I think that captures people's attention. But the purpose of the index was to give you the tools to climb up from a C plus to an A in the details.

29:55Ed Morse: OK, that's great. Bring up the quote here. We have pretty flags. It's like when I had a Merriam-Webster dictionary in my ute. And the money must read here is just real simple. The Netherlands, Denmark, Iceland and three or four other companies, best systems. They got an A, maybe an A minus. The United States, it's not even a quality C. We're tanking it. Has major risk and or shortcomings that should be addressed. Let's just begin with a why. Why are we a C or C plus and the Netherlands is an A?

30:28Christine Mahoney: The largest reason is the way we protect our lowest income employees and the voluntary nature of our pension plans. The other thing I would say, not only voluntary, right? Employers don't have to have them. Employees don't have to join them. And the dollar amount you put in is voluntary. And it can be high, it can be low. That's not true in the Netherlands. And so that distinction is the vast majority of the difference. We also need to tackle Social Security, make it more sustainable so that people can rely on it.

31:01Ed Morse: On a behavioral basis, are they an A? Is Iceland an A because they didn't screw it up like the United States? or are we at a sea and they just did so much better? Which emotion there is correct?

31:14Christine Mahoney: You know, I actually think it's important to think about the cultures, and I'm actually going to compare the Netherlands to the U.S. The Netherlands is a place that is very communitarian. A Dutch man once said to me, you can't build the Netherlands retirement system in the United States. In the Netherlands, we were stopping the water from drowning all of our neighbors as we watched our own house go under. We're a much more individualistic society, And so we have a voluntary system. And I'm not sure we're in a place where we're going to completely turn that around. But we can make it easier. We can put in minimums.

31:47Christine Mahoney: We can decrease regulation. You know, there are things we can do to make it more more advantageous for the power of your Marsh PowerPoint is not only the scorecard,

31:57Ed Morse: but all of the thinking behind it, 20 pages of thinking about what we need to do. You're sitting here with Peter Orzaga Lazard or Jack Lew, the former Treasury Secretary. What do you say to them is the priority of things we must accomplish?

32:13Christine Mahoney: Fix Social Security would be number one. Don't let people take money out before retirement age and begin to figure out how we can increase the amount of people covered and the amount that they put away. I don't know if that's better tax advantages. Maybe we could do a mandatory. And, you know, one thing that Australia did was they built their level of contribution. They didn't start at a high mandatory contribution. They started with one or two percent mandatory and then they slowly increased it. So maybe I would say Social Security first. Don't let people take the money out. Make sure they can invest it and then think about how we get more money in.

32:52Ed Morse: Is it feasible? What's your timeline to 2032 where we must fix Social Security? has Greenspan helped fix it in 86?

33:02Christine Mahoney: I think they'll do it. I'm disappointed that we waited until they had to do it, but I actually don't think they have any choice but to do something between now and 2032. And the question will not be, is it there? It's what will it look like?

33:14Ed Morse: Okay. Scarlett emails in from home. Thank you, Scarlett, for watching the show today. And Scarlett Fu says, okay, this is great, but do I need to fear that I'm not going to get a social security check. That seems to be tangible among younger people.

33:29Christine Mahoney: Absolutely. I am not a doomsdayer on social security. I'm not either, but you're the pro. Yeah, I believe it will be there, but it will be a question of what it looks like. And it probably will not look like what it looks like today. And the guarantees will not be similar for the millennials that it was for the baby boomers. But I believe we will fix this system. I don't believe we have any choice but to fix this system. I do think, I don't know if you've seen this, but recently there've been all of these studies that millennials are starting to catch up financially and actually are in a much better position now than five years ago.

34:01Christine Mahoney: So like, I think it will be different for the millennials, for sure, but I think it'll be there.

34:07Ed Morse: I mean, they've had three once in a lifetime events. I mean, we didn't have that. I mean, just the new slow this week, folks with NVIDIA and the rest of it becomes a blur here. So you start in, and as you mentioned earlier, are you putting enough aside? It's almost biblical, the concept of tithing. How much mathematically is the appropriate amount to put aside?

34:30Christine Mahoney: I think that's going to depend on what you want in retirement, but it's a lot more than what we're seeing today. Double digits would be the answer. Doesn't all have to be employee money. Employers can match. The government can be involved, but it's double digits. It's significantly higher than what we're doing.

34:44Ed Morse: You mentioned the Netherlands and others. Did we screw this up by running from the defined benefit programs of our grandparents?

34:51Christine Mahoney: I think, and an earlier guest mentioned this, I think demographics is what has screwed this up. Could we have anticipated that demographics were happening? Well, the baby boomers have been around for a long time. But honestly, fertility rates dropped a lot faster. Net migration matters in terms of immigration into countries. So I actually think there are massive external factors and we are responding to those.

35:14Ed Morse: Are you blind to equities versus bonds? I mean, do you have an allocation at March that seems to be the way?

35:20Christine Mahoney: So in March, it's going to depend on what your actual requirements are. No, but in fairness, in defined contribution plans, we do have very specific products that we offer in various countries across the globe that are more prescriptive.

35:33Ed Morse: Is your PowerPoint available on your website? It is. Folks, this PowerPoint is just a jewel. It's not just, you know, the emotion of somebody got an A, a B, or a C. Did you flunk anyone?

35:45Christine Mahoney: No, but I do. There are a couple of Ds.

35:48Ed Morse: Because marketing stepped in and said, no Fs, just Ds. It sounds familiar for my academic career. This is a killer PowerPoint from Marsh and the CFA Institute. Christine Mahoney, absolutely definitive on retirement with global defined benefit and defined contribution leadership at Marsh. Thank you so much. This is just, I can't say enough about this effort. I'll get it out on social this week on LinkedIn and Twitter, along with all of our different interviews.

36:19Ed Morse: Yes, the fish are real. Somebody emailed and said those fish are fake. I said, no, they're not. They're real. Those are Mr. Bloomberg's Aquaria, I think it is, worldwide. Bloomberg Money, we welcome all of you after this exhausting week and really back to his wonderful election coverage. He's steeled for Bloomberg this weekend. David Gura joins for a chat. We are deep into, I think it's like a lame duck session or what it is, the upward Schumer Jeffries and all this, the gentleman from, I think it's Marilyn Van Hollen or that. How do we get to Monday? What are you going to listen for this weekend to get to Monday as we try to get to 2027?

36:57Christine Mahoney: I do think the leadership fight is interesting. You have the Democrats meeting in Denver this week, obviously celebrating the victory that they had on Tuesday, but thinking about what the future looks like. And they have to be responsive to a lot of Americans who would like to see change in the way the party is structured. So I think Chris Van Hollen, the senator from Maryland, throwing his hat in the ring is interesting. I think Chuck Schumer is likely to retain the position, but encouraging and having that level of dialogue among leadership, I think is important.

37:21Ed Morse: In terms of Bloomberg money, which is a different show than Bloomberg this weekend, to me, what the arch question now of the Democratic Party is the liberals that progressives in this massive, original centrist thrust. Put color on that right now.

37:36Christine Mahoney: I think that what you're hearing from leadership, Gregory Meeks was on our show, the congressman from New York last week. He talked about how centrists are still the core of this Democratic Party. And I think that the victory that Democrats got on Tuesday was significant in part because, yes, it's a big coalition, but the centrist block of it is so large. I think we're going to see them coming to life, kind of governing the general policy trajectory of the party here. it's going to make things a bit easier for whoever leads them in the House and the Senate. Because, yes, again, you're going to have this diversity of voices, but there's going to be a core that's very central.

38:06Ed Morse: So quickly, I'm supposed to do a question on tax policy or that. Monica Guerra, Morgan Stanley's like, I don't know if there's going to be a policy. Define Gura gridlock right now.

38:16Christine Mahoney: Look, they need to pass a funding bill. I think that's what's likely to be the focus of this lame duck session. We'll see what happens there. In terms of hope for tax policy, I think a lot of Democrats would like to see the child tax policy expand in the way in which it was a few years back. I think there's movement there. But it gets to this broader issue of how do Democrats, when they're in power, respond to the anger that elevated them to this position while all the while making policy that that group of people will appreciate in one.

38:42Ed Morse: I talk all the time about John Edwards coming up with two Americas in that. You've got a book here on this political moment by one of his former speech.

38:52Christine Mahoney: Yes, this is a book by Adam Jentleson. It's called Supermajority. He was Harry Reid's chief of staff. And what he writes about is how Democrats should be striving for supermajorities, having significant control of the House and the Senate and the White House to really get legislation done. And it was when President Obama was in office. The Democrats had that last. But Adam Jentleson was a staffer for John Edwards and really was inspired by that populist brand that you're talking about here. And you love a Cartesian plane. He says, don't look at this as kind of a spectrum of progressives to centrists to, you know, more traditional Democrats.

39:22Christine Mahoney: think of it in a more multifaceted way. And to me, that's a big takeaway from what we saw on Tuesday. You don't have a whole lot of traditional Democrats buffeting this party. You had all kinds of people coming into the tent. That's what he encourages.

39:33Ed Morse: Our question, can they pick up disaffected Republicans and bring them over more to a Democratic center?

39:40Christine Mahoney: I think this election showed that they can. I think the new question now is, can they keep them there? And getting back to what I said a moment ago, it's in the policy that they're able to push through that's going to keep them there or have them leave again.

39:51Ed Morse: My book for you folks, and I'll have much more on this in the coming days. I'm up to the gilded age right now. Michael Kazin, this is the absolute definitive book on the history, the stormy history, and frankly, the brutal history of racism and anti-Semitism within an older Democratic Party. What it took to win. This is extraordinary. And David, what's so visceral here, we think it's new, all this emotion. This emotion has been over the arc of the country. We've seen this every step of the way.

40:23Christine Mahoney: Longstanding. Going back to what I said a moment ago, having this conference at which there is celebration, but also constructive dialogue, I think is important here. And I think that something that's really stressed in this book that I brought here today is we should be welcoming that. We should be welcoming the conversation. It should be fractious. That is sort of the history of this country is having these fractious political conversations.

40:40Ed Morse: We get the far right, the far left. Let's talk about the far right, the picking up the pieces of, I'm going to call it a Trump defeat that we saw. Are you optimistic that the far right can coalesce to a new message after Trump?

40:53Christine Mahoney: I think that that is a huge open question, whether that's going to happen here and what the Republican Party looks like post-Trump. I think a conversation that we were having on election night, Joe, Kayleigh, and I, as the results were coming in, is what happens to Trumpism? Is it something that's tied to Trump or will the legacy live on? I think that is the open question, how much he has shaped this party in his image. And And we had a conversation on the Big Tech podcast this week with Nick Wadams where we talked about foreign policy and all that President Trump has done to kind of move American foreign policy from the traditional set that it was before.

41:24Christine Mahoney: He thinks it's forever changed. I tend to agree with him. I think that he has moved in a different direction.

41:27Ed Morse: Are we going to really have debates or primary meetings, if you will, meet and greets of 10 candidates on each side? Is it going to be that much of a Donnybrook?

41:38Christine Mahoney: I think that it'll be a Donnybrook like that on the Democratic side. I think the Republican Party obviously is looking at the path forward here in a different light after what happened on Tuesday. It might be a fewer number of candidates on the Republican side. But I do think it'll be, as in cycles past, a big group at the beginning.

41:53Ed Morse: David Gurin, thank you so much. Super majority. I hate him. I have to go out and read this book now. It's just not successful. David Gurin, of course. Bloomberg this weekend. You'll look for that Saturday and Sunday here. It's 7 a.m. I can't say enough about the piercing conversations to get you to the Sunday talk shows and on into the next week. Of course, next week, it's Anthropic. Curtis Children have their allocations as well. It's a big debate there. Anthropic next week. We're going to touch upon that on retirement, on wealth management and your personal finance. Get your shares now. Bloomberg Money.

42:37Ed Morse: you're listening to bloomberg money stay with us with more to come after this

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44:49Ed Morse: Bloomberg Money. And of course, we're out on digital. If you want over the weekend, it sort of dribbles out here Saturday and even a Twitter thing into Monday. But our digital presentation of what we do here, these important conversations with people, is really quite something we're happy with over the last couple of weeks. Look for that out on LinkedIn, out on Twitter and YouTube, and of course, all of our Bloomberg sites as well. It's Friday, and I've got to stagger into the weekend. In the next week, Max Chavkin showed up, but even more importantly, Zidget Song showed up here on Anthropic. We've got NVIDIA now.

45:25Ed Morse: We've got all the rest of it. And on a dime, I've got to turn Monday to a pricing on Wednesday. Pricing. Excuse me, pricing on Wednesday and trading on Thursday. Yes. Eight times over, subscribe, six times, whatever. What's your reporting?

45:39Christine Mahoney: Well, my reporting showed that there's strong demand from retail side. Of course, a lot of them have participated in SpaceX before, and they are strategizing to see how they can maximize their allocation.

45:52Ed Morse: It's just greed. Come on, stop it. Speaking of greed, Max is with us. Max, I look at this and I remember with SpaceX, there was this rolling, the shares become available of people selling. Are we going to have the same thing here? Yeah, I believe so. I actually haven't looked closely at the schedule, but I believe -

46:09Christine Mahoney: Welcome to Bloomberg, Mike. You know, I think the retail, it's very much the AI trade has been a retail phenomenon, a meme stocky phenomenon. on when you look at some of the companies that have really benefited, most notably Elon Musk and SpaceX, as well as Tesla, also Palantir. I think we're going to see Anthropic, if they're smart, they will try to take advantage of the exact same dynamic, which is that there are a lot of people who are really excited to essentially gamble on this and to put a little money behind the idea of, you know, AI superpowers.

46:43Ed Morse: Not that the two of you know what a red herring is, but we used to have a document here that you'd eat at lunch and it was 28 pages and now they're 200 pages with all the risk factors. Is anybody looking at the financials, Max?

46:55Christine Mahoney: You read this, as you know, Tom, I mean, you read the S1 and it is a very strange and staggering document. You know, Anthropic is sort of performatively a weird and different company. The ownership structure is different. I think the bet is that, you know, investors are going to say, hey, I'm along for the ride.

47:18Ed Morse: I mean, James Diamond, I can only call him, what's his name, Dario? Dario, because of Saturday Night Live. That was funny. Did you see that? It was brilliant. I mean, doing Dario and SNL. Compute is deepest business dilemma. We're very paranoid about AI risk. Doesn't want AI agents to run wild. That's not a normal initial public offering, is it?

47:42Christine Mahoney: No, it's not. But it's not deterring those really committed believers of AI. It's interesting because the retail investors who are interested in Anthropic are kind of different from SpaceX. Because SpaceX, you've got the Elon factor, you've got the Tesla, the space enthusiasts. Whereas for Anthropic, it's those tech workers, the AI nerds sort of. So they read the Anthropic reports. They read the monitor industry benchmarks for model progress.

48:08Ed Morse: Help me here. I feel so damn old in this conversation. Max agreed. They're going to come out. It's going to pop X number of points. Does everybody sell?

48:19Christine Mahoney: I mean, you know, the trends on initial public offerings in the period immediately after an IPO are not great. And we saw it. We saw it happen with SpaceX. I don't feel qualified to to predict, you know, the exact market dynamics. I do think the AI market right now is in a very tenuous place. I have for weeks been wondering, are they really going to do this? I think it inspired a little bit of confidence in the market that they appear to be moving forward with this IPO, despite the NVIDIA issues, despite the fact that many AI stocks are way down over the past couple of months. So it's uncertain.

48:58Christine Mahoney: And I think people who get into this should realize that.

49:00Ed Morse: I got a minute to the two of you jumping here together. If Anthropic is successful with this, who does it benefit most in the AI derby? Which is the next company that would learn from this?

49:11Christine Mahoney: I think it'll set a tone for open AI. And that's what a lot of investors are watching for, too. They're kind of hoping that Anthropic proves that this is AI trade is still going strong.

49:21Ed Morse: I agree with this. There's a huge follow on model to this.

49:25Christine Mahoney: 100 % agree. I think conventional wisdom says Anthropic and open AI are rivals. But if this IPO does not go well, I think that bodes very, very poorly for OpenAI, because even though the two companies have their differences, they're kind of selling the same thing. And if there isn't a market for the one, it's hard to imagine there's going to be a market for the other.

49:43Ed Morse: Now, are you keeping from us? Do you know who's going to take over at NVIDIA? Do you and Stacey know everybody's business? I've got the shortlist. Who's going to take over?

49:51Christine Mahoney: I mean, the whole thing with this transition is that no one knows. It didn't seem like Jensen knew or the board or anyone.

49:58Ed Morse: This has been wonderful. Let's do this again. Let's do it next week after Anthropa comes out. We'll see. Zizia Song, Max Chafkin with us here. Thank you so much for your attendance today. Bloomberg Money and all of our digital work.

50:15Ed Morse: This is the Bloomberg Money podcast, bringing you a smart look at the forces shaping your financial life. I'm Tom Keen with Scarlet Fu. You can watch the show live on Bloomberg TV every Friday at noon Wall Street time. Subscribe to the podcast on Apple, Spotify, or wherever you listen. And as always, on the Bloomberg Terminal and the Bloomberg Business app.

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