Future of Finance 2024: Biden, Trump and What the 2024 Election Means for Finance
Anthony Scaramucci, Founder and Managing Partner, SkyBridge Capital, Andrew Yang, Co-chair, Forward Party Moderator: Jeff John Roberts, Fortune
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00:00 Hello again, everyone.
00:01 Let's get into it.
00:02 I've got two very lively gentlemen
00:04 who do not lack personality.
00:06 I'm going to try to turn it down for at least the first five
00:08 minutes and leave the partisan hats off.
00:11 And just tell us a down the middle take
00:14 on what a Biden re-election would mean for the economy
00:17 and what a Trump re-election would mean for the economy.
00:20 Woo.
00:20 OK.
00:21 [LAUGHTER]
00:23 All right.
00:24 Go ahead, Andrew.
00:25 We know what you think of--
00:26 Sure, I'm very happy to.
00:28 So I'm in the camp that thinks Trump would be a catastrophe,
00:33 as our president again.
00:35 He's learned from his mistakes last time,
00:38 which is hiring responsible adults who sometimes tamp down
00:42 his policy desires and instincts.
00:44 I unfortunately think he's the favorite to win.
00:46 I think if the election was held today, he would win.
00:49 And the question is whether something changes
00:51 over the next six months.
00:53 One of the things that's underreported, folks,
00:55 is that Biden's main advantage is money,
00:57 but they've spent $35 million in the swing states
01:00 trying to boost his numbers.
01:02 And it has had no impact, which augurs very, very poorly
01:06 for the fact that money is going to swing
01:08 the approximately 7% of genuine swing voters in those states.
01:13 So right now, my projection would be Trump wins.
01:16 Some very, very bad things happen
01:19 administratively and institutionally.
01:23 But the effect on the economy would be unclear.
01:26 - So I think the superficial analysis,
01:29 particularly from people on Wall Street,
01:31 Trump's better for the economy.
01:32 And then they list all these policy things
01:34 that he would do that would be better for the economy.
01:36 But I think he would be terrible for the economy
01:39 and terrible for the country.
01:40 And I'll tell a quick story.
01:43 And this happened in the White House.
01:45 And it happened on a Wednesday.
01:46 The reason I know it happened on a Wednesday,
01:48 I was only there for one Wednesday.
01:50 So I know--
01:51 [LAUGHTER]
01:52 I know it happened on a Wednesday.
01:54 [LAUGHTER]
01:55 And it was him and Paul Ryan.
01:57 And they're bigger than me.
01:59 And they were fighting in the Oval Office.
02:01 And Trump was putting his finger on Paul.
02:03 And he was saying, you work for me.
02:06 You work for me.
02:07 And Paul's looking at him like, I don't work for you.
02:09 I'm in a totally separate article of the Constitution.
02:12 I don't work for you.
02:13 And Trump was looking over at me.
02:14 He's like, is he right?
02:15 He doesn't work for me.
02:16 I'm like, no, he doesn't work for you.
02:19 And Trump doesn't like that.
02:21 And the people in this room that really understand
02:24 the Constitution is what has made this economy.
02:27 The predictability of the laws, the separation of the powers,
02:30 the inability to create an autocracy in the country
02:35 for the last 250 years has protected your businesses.
02:39 Because the sanctity of the laws allow
02:42 for the free flow of capital.
02:44 And people own their property in this country.
02:46 It's backed up by the court system.
02:48 And there's 900 years of legal precedent.
02:50 Mr. Trump doesn't like any of this.
02:53 And he's an orange wrecking ball for this society.
02:57 And he's going to come in with a group of people
02:59 that believe in something called unitary executive power.
03:02 And if you don't know what that means,
03:03 you should Google it somewhere tonight.
03:05 And you should understand what the Heritage Foundation believes
03:08 and what Mr. Trump believes, that they
03:10 want to expand and knock out the other two branches
03:14 and make him uber powerful.
03:16 And when that happens, you get what
03:18 happens in every other autocracy.
03:20 A really bad system and a lack of predictability in the laws.
03:23 So yes, superficially, he sounds better for the economy.
03:28 But he's a disaster for the economy.
03:30 He's a disaster for the world.
03:32 And he's a disaster for your business.
03:34 And you've got to be really careful.
03:36 Can I just say one last thing?
03:37 There are 40 of us that are speaking out against him.
03:40 One of them was on the ballot with him last year,
03:43 or four years ago.
03:44 The president picked a guy named Mike Pence.
03:46 Anybody remember him?
03:48 He was the vice president.
03:51 They were chanting, kill Mike Pence on the 6th of January
03:55 in 2021.
03:57 Mike Pence said, I've had enough of this.
03:59 And under no circumstances will I endorse or support
04:03 Donald J. Trump.
04:04 There are 39 other people that have said the exact same thing.
04:08 I submit to everybody here rhetorically.
04:10 Let's say all of us work for a car company.
04:12 And we say, hey, this car sucks.
04:14 And they didn't build it right.
04:15 It's going to kill your family.
04:17 Or we work for an auto airline manufacturer.
04:20 We say, this plane is going to fall out of the sky.
04:22 Or we work for a drug company.
04:23 We said, the drug's going to kill you.
04:25 What is going on in this country where
04:28 you have super smart, very patriotic people,
04:32 guys like General Kelly, who are not even partisan--
04:34 OK, Anthony, I've got to cut you off.
04:36 I think we get it.
04:37 And I think, for the record, I agree.
04:40 The institutions held last time--
04:42 I don't know if the Central Bank and so on would hold this time.
04:44 But we might find out.
04:46 Let's switch it to Biden.
04:47 He's got a plan to end the Central Bank, by the way.
04:50 I've heard of that.
04:51 Let's go to Joe Biden for a sec.
04:52 I mean, I think the proficacy with the debt's
04:55 probably not helpful.
04:56 I was really just getting started, by the way.
04:58 Just getting warmed up.
05:00 All right, go ahead.
05:00 Go ahead, Jeffrey.
05:01 It's clear you think Biden is better.
05:02 But do you think there would be any economic pivots?
05:05 Would Elizabeth Warren still be running
05:07 herd over the financial markets?
05:08 What would be different?
05:09 Or would it be more of the same?
05:10 Go for it, Andrew.
05:11 No, no, it would depend upon what
05:13 happens in the House and the Senate.
05:15 I mean, projections are Republicans take the Senate,
05:17 and then the House is going to be pretty evenly split.
05:22 But a lot of Biden's policies have
05:25 yet to be fully implemented.
05:26 I mean, they authorized $1.2 trillion,
05:28 of which just came out that maybe 18% of it's
05:32 been spent or committed or allocated.
05:34 So they bit off a giant chunk, and then they're still
05:39 trying to figure out how to chew it.
05:41 So if you have a second Biden administration,
05:45 then the other 80 some odd percent of that
05:47 gets deployed and spent in various ways.
05:49 If Trump comes in, then Trump will probably
05:51 try and pull that back.
05:53 So I don't imagine any whipsawing
05:57 in terms of economic policy, depending upon who
06:01 controls the legislative branches.
06:03 And I do want to say to you all, if you
06:06 want to read more about Anthony's 10 or 11 days
06:10 as comms director, he has a book out this week that goes in.
06:14 Don't hurt my feelings.
06:16 Andrew, we're good friends.
06:18 Don't hurt my feelings.
06:18 It was 11 days.
06:19 Don't chip me out of that last day.
06:21 It's a big day.
06:22 I got fired in that last day.
06:23 It was a big day.
06:24 I had like a 10% cut.
06:26 Anthony, how do you feel it's actually become like a noun,
06:29 a very short tenure is now a scaramucci of work?
06:33 I think it's great.
06:34 Listen, the only problem is people are very sensitive.
06:36 I tweeted out that Liz's trust lasted 4.1 scaramuchis,
06:41 approximately 45 days.
06:43 She got very upset.
06:44 I tweeted out that Kevin McCarthy lasted 24 and 1/2
06:48 scaramuchis at speaker.
06:50 Guy got very upset.
06:51 I mean, these people are a bunch of babies.
06:53 Just relax.
06:53 We're making a joke.
06:55 We've got all the big topics.
06:56 I've got to go granular for a second.
06:58 No, go ahead.
06:58 Carried interest loophole.
07:00 You have a hedge fund, right, Anthony?
07:02 And you get that very favorable tax break.
07:04 And every couple of years, they're
07:06 going to repeal it because who doesn't
07:07 want to take money away from the hedge fund guys
07:09 and have you guys pay lower taxes than the rest of us?
07:12 You see that being repealed any time.
07:13 Is that for me?
07:14 Both of you.
07:14 So I'm going to channel David Rubenstein.
07:17 He said, God has ordained-- that was the 11th commandment
07:20 on the table.
07:21 I said, we're going to keep the carried interest loophole.
07:24 I pay 50--
07:25 I don't know about you guys, but I live here in New York.
07:27 I pay 52% marginal tax.
07:31 I'm a minority partner in my own life now.
07:33 So the dollar comes in.
07:35 $0.52 goes to Eric Adams, Kathy Hochul, and Joe Biden.
07:39 I get to keep $0.48 for my family.
07:41 I am totally fine with that.
07:43 If they want to end the carried interest loophole,
07:45 if that's going to benefit the society,
07:48 I'm totally fine with that.
07:49 We have a huge disparity in the society right now.
07:53 And I don't want to be a rich guy living
07:55 in a bob-wired security McMansion
07:58 while my fellow neighbors are suffering.
08:00 So me personally, I have never complained about my taxes,
08:03 don't mind paying them.
08:05 I would love to audit the city or the state
08:09 and see where the taxes have gone,
08:11 because it doesn't make sense that we have the budgets
08:13 that we have and we have the services.
08:15 Yeah.
08:16 Yeah, it's like spending--
08:17 That's why he was my guy for mayor.
08:19 Didn't work out.
08:19 Yeah, man.
08:20 I would have been happy to open the books.
08:22 Those would have been good times.
08:24 [LAUGHTER]
08:28 And they wouldn't want somebody like Andrew to open the books,
08:30 because, you know, come on.
08:31 It's bad.
08:32 Yeah.
08:32 I was that--
08:33 They've got $2 trillion.
08:33 They can't find $2 trillion.
08:35 Come on.
08:36 So I want to comment on the dynamics of the economy.
08:40 So you have capital on one side, then
08:42 you have technology on the other.
08:43 And they're commingling to accelerate
08:46 the most extreme winner-take-all economy
08:48 in the history of the world.
08:51 And so you can take shots at addressing
08:54 some of these inequities.
08:56 But the inequities are getting more powerful and faster
09:00 all the time.
09:01 One thing I joke about is that AI is getting faster and smarter,
09:05 and we are lucky not to get slower or dumber
09:07 in any given day.
09:08 Like, if we stayed the same, it was a good day.
09:10 You know what I mean?
09:11 But then if you extrapolate that society-wide,
09:15 we're going to displace millions and millions of workers.
09:17 And even now, major corporations are
09:19 cutting high-priced employees, because they're figuring out,
09:22 wait a minute.
09:23 I'm paying you $200?
09:24 I can pay this person $75 and stack an AI on top of them,
09:27 and voila.
09:28 Or I can replace--
09:29 I mean, there are 2 million Americans
09:31 who work at call centers still.
09:32 When will AI replace them?
09:35 Now, what day of the week is it?
09:36 People are like, oh, it's Tuesday.
09:37 I'll get around and do it by Friday.
09:39 So there are all of these trends that are speeding up.
09:41 And the question is, what does the real economy
09:46 of the future look like if you're trying
09:48 to prioritize human values in an era
09:50 where we're going to lose in epic fashion to the machines?
09:53 And all of the people are like, oh, we're going to work
09:56 with the AI.
09:57 We're going to reskill people.
09:59 It's generally wishful thinking/nonsense/good
10:04 for the press release.
10:05 And then you go back and actually
10:07 do what you're going to do within your organization.
10:09 So the reason why I've been pro-crypto this entire time
10:13 is that, in my opinion, the only way out of this
10:16 is to create a multivariate economy that
10:18 rewards various human activities independent of whether it's
10:22 actually capitally efficient if you measure it
10:25 in just one axis, which is the monetary axis.
10:28 So imagine a currency that was rewarding arts and creativity,
10:32 and then another one that was for nurturing and caring
10:35 and education, and another one that
10:37 was for health and wellness.
10:38 And you had millions of people pursuing
10:40 each of these activities.
10:41 That, to me, was the promise of cryptocurrencies.
10:44 And it has failed.
10:46 It has failed because what crypto has primarily
10:48 been used for-- and I'm still pushing in this direction
10:51 because it's necessary--
10:53 but it's failed because it's primarily
10:55 being used as an engine of financial speculation
10:58 and as a hedge to collapsing confidence in fiat currencies.
11:02 And that's a use.
11:04 Congratulations.
11:06 But it's not addressing any of the big picture issues
11:09 that, in my mind, are just speeding up all the time.
11:12 So we're here about future of finance of the '24 election.
11:15 To me, that has to be the vision of the economy
11:17 that we're moving towards as quickly as possible.
11:20 Yeah.
11:21 Anthony, I'd like to ask you about that.
11:22 AI has come up a lot today.
11:23 It's coming up everywhere.
11:24 What do we do with this risk of a whole bunch
11:26 of superfluous Americans?
11:28 It sucks to be poor in America right now.
11:31 What if AI makes another $10 million, $20 million redundant?
11:35 How do we address this?
11:38 Yeah.
11:39 I'm more optimistic.
11:41 And I think what ends up happening
11:43 is you get these S-curves that are transformative.
11:47 And they never work out exactly the way
11:49 that doom and gloom people say.
11:51 And so we had that problem with automotive.
11:53 We had that problem with factories and automation
11:56 in factories.
11:56 We had that problem, believe it or not,
11:58 in telecom and delivery of mail.
12:00 And so I'm a little bit more optimistic.
12:02 There's a professor at Oxford by the name of Nick Bostrom.
12:06 You may know who he is.
12:07 He wrote the very famous 2001 memo about are we
12:11 or are we not in a simulation.
12:13 He has a brand new book coming out right now.
12:15 I interviewed him on my podcast.
12:17 And he's talking about what could be a deep utopia, where
12:21 you do have the people that have been displaced,
12:25 but there's enough productivity in the economy
12:27 where they're getting the universal income that Andrew's
12:30 talking about.
12:31 And all of a sudden, people are actually, in a weird way,
12:34 happier.
12:35 And so that is quite possible.
12:37 I'll just leave you with two quick things.
12:39 Tom Malthus said in the 1840s we were going to starve.
12:42 He left out all the technology, the exponential technology
12:45 of more people dying from obesity-related illnesses
12:48 and starvation.
12:49 In 1985 at Tufts University, I had a professor tell me
12:53 we were out of oil.
12:55 Some of us in this room are old enough
12:57 to remember peak oil theory.
12:59 Oil, we're going to lose the oil in 2010.
13:04 We have more oil than we know what to do with.
13:07 And so I don't believe the gloom and doomers
13:09 when it comes to people and innovation.
13:12 I believe that we are problem solvers.
13:15 And if we get the right leadership, moral leadership
13:18 in government and in politics, we can solve these problems.
13:22 Yeah, I think it's important to be optimistic.
13:24 You're not the only one who has that view.
13:25 Vinod Khosla, who I think we saw on Laguna Beach,
13:28 predicts that we'll get to a point
13:29 where you all have to work if you want to.
13:30 And let's hope it works out that way.
13:31 Oh, yeah.
13:32 I think that vision of abundance is
13:34 possible if you had a functional government.
13:36 And then I'll just leave it at that.
13:38 [LAUGHTER]
13:40 Let me do the hard part.
13:42 We've got to touch crypto, because we all like it.
13:44 I probably half the room hates it.
13:46 But there's a giant crypto campaign, Vote Crypto.
13:50 And my reporter, Leo, is like, there's
13:52 only one person who's going to vote based on crypto.
13:54 But maybe not.
13:56 Do you think, like we saw this movement in the Senate today,
13:58 do you think crypto could affect the election on the margins?
14:02 Oh, yeah.
14:02 I mean, this election is going to get decided
14:04 by a razor-thin margin in probably three states.
14:09 And the margin last time was, let's call it,
14:10 60,000 votes in three states.
14:13 So can you imagine that being swayed by some people staying
14:17 at home because of something that they don't like
14:20 the president's stance on, or crypto,
14:23 or a number of other micro variables?
14:27 I mean, 50,000 in a country of 330 million is not many.
14:31 But it's certainly a much smaller number
14:33 than our crypto enthusiasts in various parts of the country.
14:38 And some of those interest groups are spending money.
14:43 So it could easily be a tipping factor.
14:46 So here's what I would say.
14:49 If you read crypto Twitter or X, it's a huge deal.
14:53 I don't think it's a huge deal.
14:54 But I do agree with Andrew.
14:56 On the margin, it could stop young voters
14:58 from voting for somebody that's anti-crypto.
15:00 So I would just say, if you looked at a Nash game theory
15:03 analysis, it would probably be better for you
15:06 to be pro-crypto because you're not
15:08 going to lose any voters being pro-crypto.
15:10 But you may lose some not being crypto.
15:12 But I'll just submit this to you.
15:13 There's a movie.
15:14 There's two movies playing at your local cinema
15:17 in November on election day.
15:18 One is Weekend at Bernie's.
15:21 We know that.
15:22 You know that, right?
15:23 And the other one is One Flew Over the Cuckoo's Nest.
15:27 So you can choose between an elderly guy that's
15:29 somewhat forgetful or a lunatic that needs a lobotomy.
15:33 I'm going with the elderly guy, somewhat forgetful.
15:36 Fair enough.
15:37 Let's end on a high note.
15:38 Backstage, Anthony was telling me--
15:43 Backstage.
15:44 He offered his names for KMF, Ask Your Neighbor
15:49 If You Don't Know What Those Stand For.
15:50 But apparently it's the New York Post.
15:51 He can't do it again on stage to look it up.
15:53 But it was a good answer.
15:54 But let's end with--
15:55 I already did it.
15:56 Yeah.
15:57 OK, quickly, Anthony, how far are the Knicks going to go?
16:02 So I'm an eternal optimist.
16:04 And I've been waiting for three decades.
16:06 So I'm going to say all the way.
16:09 But here's the thing.
16:10 Easy applause line, man.
16:12 Here's the thing.
16:12 If they don't go all the way this year,
16:15 I think they actually have the chemistry in place for next
16:18 year with a couple of changes.
16:19 So I'm very happy, very optimistic.
16:22 All right, and my last serious question.
16:25 Name someone in finance, in the finance industry in New York
16:28 you admire morally and as a sort of accomplished
16:30 financial professional.
16:32 You want to go first?
16:34 I mean, there are a number.
16:35 But I suppose given the context of where we are,
16:38 I like and admire Mike Novogratz.
16:39 I think he's his own freaking human being.
16:41 He has his own judgment.
16:42 He's made calls that have been right, wrong, popular,
16:45 unpopular.
16:46 But he's a stand-up, genuine human being.
16:50 So I love Mike.
16:51 So since that was already taken, I'll say Larry Fink.
16:54 And I'll just say this.
16:55 The smartest people, when they get something wrong
16:59 or they get new facts, they change their mind.
17:02 And Larry Fink was very negative on Bitcoin and crypto.
17:06 He spent the time and the energy,
17:08 and he moved towards Bitcoin.
17:10 And he had the most successful ETF launch in history
17:13 this year with his Bitcoin ETF.
17:15 And a sign of great leadership is getting things wrong,
17:20 taking risks, being able to admit that you got something
17:22 wrong, and adapt and pivoting.
17:25 And I think Larry represents that.
17:27 OK.
17:27 We're out of time.
17:28 Thank you, gentlemen.
17:28 Please give it up for Andrew Yang and Moots.
17:30 Thank you.
17:30 Thank you, guys.
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