Original Title: Capital, Politics and Power: Ken Griffin on the 2024 Election and What’s Next for the U.S. Economy
Translation by: zhouzhou, BlockBeats

Editor’s Note: This conversation is about the U.S. economy, investment, cryptocurrency, and future technology, focusing on the flexibility of American capitalism, entrepreneurship, the potential of cryptocurrency, and the future of investment. The guest particularly discusses his views on cryptocurrency, expressing a reserved attitude towards its future despite missing investment opportunities. The discussion also covers wealth growth, technological innovation, economic differences between Europe and the U.S., and future market trends.

The following is the original content (reorganized for readability):

Host: Today's guest is Ken Griffin, the founder and CEO of Citadel. I believe he is one of the most influential individuals in the current financial markets. His hedge fund manages about $65 billion in assets, but perhaps more importantly, Citadel Securities handles nearly a quarter of the trading volume in the U.S. stock market every day.

He is also a significant philanthropist and has considerable influence in American politics. In the recent election cycle, he was one of the top five donors to the Republican Party, second only to Elon Musk.

I want to start with politics and policy, as you were mentioned as one of the largest donors to the Republican Party. Interestingly, I noticed that you did not donate to the election of President Trump. I want to read you a quote; in October, you said, "I did not support Donald Trump, and I am conflicted about this issue. I know who I am going to vote for, but I am not happy about it." Now that the election is over, are you happy?

Ken Griffin: Yes, because the Republicans won the House, the Senate, and the White House. We now have the opportunity to govern and make America serve ordinary Americans, bringing the country back to a principled, powerful, and prosperous state. I am excited about this possibility.

On the Second Trump Administration

Host: Can you talk about your dissatisfaction with the elected president?

Ken Griffin: I think the elected president has faced tremendous personal pressure over the past few months. Imagine facing relentless attacks from the American legal system and nearly experiencing an assassination—he was just an inch away. But he persevered and won the election. At that time, we saw a person under immense pressure, and that is undeniable.

This pressure has not always allowed him to show his best side, which is understandable. However, now that he is the elected president, I will do everything I can to support his future role as President of the United States.

Host: You mentioned that you were not happy when voting; I guess you voted for him, right? So you are satisfied with this outcome?

Ken Griffin: Yes, I voted for him. I believe that between the two candidates, from a policy perspective, this is clearly the best outcome.

Host: Let's talk about some policy issues, perhaps the biggest one being tariffs. This issue currently has no clear answer, but its impact on the economy is enormous.

Ken Griffin: The U.S. has reopened for business, and the paralysis caused by regulation and litigation during the Biden administration has ended. So when I talk to a group of American business executives, whether they are from the telecommunications industry or consumer sector, regardless of whether they voted for Trump or Harris, they are all smiling. Because they can now focus on creating value for customers, creating jobs, growing their businesses, and achieving prosperity, rather than being bogged down by endless meaningless lawsuits and regulations.

For example, Lina Khan seems to have completely missed the advanced economics courses in college. Her role in undermining American productivity is significant. Therefore, I believe that for America, all the issues regarding tariffs and energy extraction are secondary; the primary issue is that America has started to develop business again.

Host: Why do you say these are secondary? The regulatory policies of the Biden administration have indeed brought a lot of uncertainty.

Ken Griffin: This is not uncertainty; it is a complete loss.

Host: Now there is new uncertainty, such as the tariff issue. What are your thoughts on this?

Ken Griffin: I think it may take months or even years to figure out the direction of all this. It is clear that this uncertainty will indeed undermine capital formation, there is no doubt about that. At the same time, we must remember that the president's background is in real estate, and the negotiation rules in real estate often differ from what we see in stock or bond trading.

In real estate, you might buy a building every few months or years, and you may never deal with the same seller again. The negotiation dynamics in this model are completely different from frequent daily trading. I believe the president has brought this behavioral model to the White House because it is part of his economic background.

He will take some bold positions and then observe the reactions. For example, you see him threatening tariffs against Canada and Mexico.

Host: I think a bigger issue might be about the "BRICS" countries, for instance, the elected president stated that if these BRICS countries try to establish their own currency system, the U.S. would impose tariffs on all of them. I think this new uncertainty might be something you did not anticipate before?

Ken Griffin: The key is: where will this lead? The president will not do that, and it will not happen. The BRICS countries will not detach from the dollar in the next four years. He will not retaliate against their trade or other matters because of this.

Host: Language is indeed important. When we read his tweets, statements, or other social media content, some words may seem meaningless. Do you think his declarations, even if you believe they will not be realized, will have any impact on the country?

Ken Griffin: Of course, it will have an impact. As a media person, you should know that language has power.

Host: I agree, so I am curious, is this language important to you?

Ken Griffin: It is certainly important, which is why I couldn't smile when voting. I hope his language is more precise, and that the ideas he conveys are more transparent, clear, and easy to understand. But the core idea he expresses—that America can be an exceptional country, a country where people can live better lives, a country that allows people to make their own decisions—these values resonate throughout the nation.

Host: We need to distinguish the big picture. The significance of this government is that it represents a free America, a prosperous America, a strong America, and a respected America. We should focus on these big-picture issues, as they are the core of America. However, the issue of "being respected" is indeed interesting, right? If you continuously conflict with all surrounding countries, this will become a core issue.

Ken Griffin: There is no doubt that the whole world is looking forward to American leadership. While we may issue tariff threats against Mexico or Canada, these are minor issues compared to the world's expectations of America. For example, when we tell Hamas to release hostages before the president's inauguration, such statements have significant implications for the entire world.

Host: Let me ask you a question. Trump just appointed Scott Besson as Secretary of the Treasury. I know you previously supported Mark Rowen, who was at Apollo at the time. What do you think of Scott Besson as Secretary of the Treasury?

Ken Griffin: I personally do not know Scott, but I have a friend who is one of the most successful fund managers in history, and he speaks highly of Scott. Frankly, Mark Rowen is very good at managing large organizations. From my perspective, the people around the president need to have the ability to manage large organizations, which is a very important skill. So I can easily be excited about Mark, but that does not mean Scott cannot do the job.

Host: The reason I ask about Scott Besson is that he has mentioned the possibility of undermining the independence of the Federal Reserve, and we will soon see Trump and the current Federal Reserve Chairman Powell. Scott Besson has publicly discussed the idea of creating a so-called "shadow Federal Reserve Chairman." This person would be nominated to the Federal Reserve but could influence the market even if not in the Federal Reserve, leading investors to be skeptical of the current Federal Reserve Chairman's policies and more inclined to predict what the next chairman might do. What do you think of this idea?

On the U.S. Economy in the Next Four Years

Ken Griffin: We need to return to the fundamental issue: the independence of the Federal Reserve is crucial for the stability of the dollar. I have publicly supported Powell, not just in recent months, but for many years, because I genuinely believe that whether it is President Trump or any former president, the independence of the Federal Reserve is vital for maintaining and enhancing the health of the American economy.

Of course, every president will have some opposition when the Federal Reserve makes tough decisions. From a political perspective, when the Federal Reserve raises interest rates to control inflation, leading to job losses, as president, you cannot say, "Great, I am very excited about this." No one expects the president to play such a role. The job of the Federal Reserve Chairman is precisely to make those difficult decisions that politicians dare not face.

Host: So far, how do you evaluate Jay Powell's performance?

Ken Griffin: I want to clarify that Jay Powell faces one of the worst jobs because the Biden administration has pushed this country onto an unprecedented inflationary path with its irresponsible fiscal spending, and then he has to deal with the task of cleaning up the massive fiscal deficit, just as this government needs to clean up these deficits. So, over the past few years, his job has been very difficult, with almost no chance of success.

Therefore, some people believe he may have successfully landed, or at least achieved a soft landing, or that we are still circling in the air. You can now look at the stock market. It feels good in the short term, but as Scott said, I applaud him; we must sort out the fiscal issues. As we organize federal finances, this will have other impacts on our economy, and both the legislature and the Federal Reserve must address these issues.

Host: So now, the stock market looks good, while the bond market may perform differently. What do you think is happening?

Ken Griffin: There is no doubt that we should return to the opening comments about American businesses; the current situation is better than before the election.

Host: Doesn't that weaken all other uncertainties? Or do you think these uncertainties won't happen at all, and that's what we should decide?

Ken Griffin: No, it's the difference between understanding the big picture and getting caught up in the details. It's like the problem of seeing the trees but not the forest.

Host: But considering the White House, as you said, Congress and the Senate have turned red. Are there any controlling factors, perhaps the bond market, that will ultimately discuss spending and other upcoming matters, or things that won't happen? Do you think the bond market will be affected if we don't get the situation under control?

Ken Griffin: If we don't straighten out our finances, the bond market should be affected; I mean, that's exactly what the bond market is supposed to do.

Host: Do you believe in Elon Musk and Doge? Because this relates to whether the bond market thinks we have the situation under control.

Ken Griffin: It’s quite absurd to place all the responsibility on Elon Musk, and we now have some extremely capable, competent, and smart people helping the president's advisors. We have returned to the good old days when people like this were not in the White House; I would welcome Elon into the White House now. What we hope for is that the president, Congress, the Senate, and the judiciary can all play a role in opposing crony capitalism.

One of my biggest concerns, whether with the current administration or the previous one, is the increase of crony capitalism in America. When we play favorites with taxpayer money in Washington, choosing winners and losers, it is truly unfair to American taxpayers, American consumers, and future generations. And this is not just a Washington issue. Look at California, trying to provide electric vehicle subsidies to all companies except Tesla. I mean, it’s simply incomprehensible; how can it be so shocking?

Host: You are an investor in Tesla.

Ken Griffin: That was a few weeks ago; we trade a quarter of the stocks in the U.S. market every day.

Host: That is true. I am actually very interested; if you are an investor in Tesla, or at least interested in it, an important decision was made this week. I don't know if you are following the issue regarding Elon Musk's compensation package, which has been pending for the past year. What are your thoughts on this? In this case, shareholders voted to approve the compensation package, while the court in Delaware, where Tesla is registered, stated that it is unacceptable. What are your thoughts?

Ken Griffin: I can only say one thing: if you have a $5 billion risk and it’s still okay, that must be fantastic, but can you imagine that risk?

Host: In fact, this raises a question. You happen to be one of the richest people in this country; perhaps you don't have an extra $5 billion lying around, but you are at the top. I want to read you something; I am curious about how it affects you.

Warren Buffett just wrote a letter; I don't know if you've seen it. He talked about giving away more money and letting his children do it. He wrote the following, which I found interesting. He said he was confident he would become wealthy at a young age, but neither I nor anyone else ever thought that the wealth that could be obtained in America over the past few decades would be so enormous.

He couldn't even believe such a thing would happen, even for himself; he said it was beyond the imagination of Ford, Carnegie, Morgan, or Rockefeller. Today, billions have become the new millions. What do you think of this idea? Because I think it represents a significant shift in our culture and society.

Ken Griffin: This is the astonishing part of American history. About 125 years ago, nearly half of the population in America was engaged in agriculture. The transformation of our economy over 12 decades is staggering. Now we are at an interesting economic juncture where a smart idea can be rapidly pushed to market and reach billions of consumers overnight.

In fact, think about the immediate influence we gain from this meeting today. Meetings like this can now connect you to the entire world, which I would have thought impossible 50 years ago. So this means that in this era, great entrepreneurs have the ability to create an idea, bring it to market, and launch it globally in a way that was previously unimaginable. Right? If you think back 70 years ago, you opened a single retail store. If all went well, you might open another store a few miles down the road or in the next town, right? But today, with Jeff Bezos's Amazon, yes, Amazon provides everyone with instant access, but you can't imagine what it was like 50 years ago.

Host: I don't disagree; it's an amazing thing. But the question is, if billions are the new millions, then I guess we will soon see trillions.

Ken Griffin: I think Warren is very clever in his choice of words. After all, the number of millionaires is far fewer than billionaires.

Host: Sean Fain said billionaires shouldn't exist at all. You are a capitalist; what do you think? I just want to know your thoughts on this despair.

Ken Griffin: That’s where he has a problem with many things—he doesn’t understand the consequences of his actions. We can all become poor, but I would rather not be poor, and everyone would rather not be poor. In our country, we would rather not become Venezuela.

Host: I have a few quick questions to ask you, actually about a specific aspect of your current business.

Ken Griffin: The flexibility of the American capital system and the American labor market is an important part of the story of our country's standard of living, which no other country can match. On average, the standard of living is so high, and children have so many opportunities. Look at Europe; compared to America, it is simply sluggish. It is a continent that is disappearing on various levels; their birth rates are a challenge, economic growth is slow, per capita data is heartbreaking, and there is no optimism for the future. Do you want to become Europe? I don’t. I want to be an American.

Host: Let me ask about investment business, as it has changed a lot over the years. I think there are now two models operating. One is the model you are in; I categorize you with Millennium Capital, perhaps Point72, and even Jane Street. The other is individuals with their own companies. A question is whether we can effectively compete with larger firms. What do you think of this concept?

Ken Griffin: If Serena Williams came today and played tennis with me, I would say, "Aren't you going to express your views through tennis?"

Host: What I mean is that there are now two such massive funds acquiring various information. I am not saying illegally obtained information, but these large teams can pass the cost of acquiring vast amounts of information onto their investors. This is completely different from the business model of 10 or 20 years ago. If you were to start a small fund today, do you think you could compete with your own current firm?

Ken Griffin: That’s the power of youthful naivety, right? Just like when I started, I had to compete with firms like Solomon Brothers and Goldman Sachs, which seemed enormous.

Host: So if you were to start a fund or do something today, what would you do?

Ken Griffin: That’s what entrepreneurs have; they have that belief: even though under any set of metrics you have almost no chance, I am going to do it anyway. Do you think Elon Musk thinks he can beat the big car companies just based on first principles? No, I think it’s about hard work and bringing better people together and then finding ways, like an entrepreneur, to achieve goals.

What has changed in the investment business over the past 30 years? There have certainly been huge changes; the rise of passive investing is enormous. Now nearly 50% of all assets are in passive investment vehicles, which have almost no cost to investors. But the premise of these tools is that the market is efficient because active management firms like Citadel, Millennium, and Point72 exist.

And it should be clear that there are also hundreds of other very good, very capable hedge funds, like D1, etc. These are all companies that are doing very well and conducting very good research. Because that’s the interesting part of my job. My job is essentially research work. As you said, it’s about gathering information, drawing conclusions, understanding business models, understanding products, and understanding which parts are not reflected in stock prices.

Host: In the good things happening in this country that you mentioned, considering all these factors, what large-scale investments would you make now? Are there specific areas or companies you would invest in?

Ken Griffin: The global trend is that more resources are flowing to the U.S.; this is the global trend because it is the most vibrant country.

Host: Is there a particular industry, company, or place you are looking at that you can tell everyone, "This is the direction we are heading"?

Ken Griffin: That’s the challenge between investment and the economy; the direction of the economy is clear. Healthcare will continue to become increasingly important, technology will continue to attract resources, and will continue to innovate our lives. But the question is, as investment objects, have we fully reflected a bright future in the valuations of these companies, or have we over-reflected a bright future?

On the Future Development of Cryptocurrency

Host: So what do you think about another rapidly developing area now? That is Bitcoin and cryptocurrency.

Ken Griffin: Let’s end with this. What do you think?

Host: So cryptocurrency is not interesting to you at all?

Ken Griffin: For example, I have some canvases with oil paint; the canvas might have cost $15, and the oil paint about $20, totaling around $35, but these paintings trade for tens of millions of dollars. What right do I have to evaluate cryptocurrency?

Host: But you have been asked to evaluate cryptocurrency for a long time, and you have made a judgment by not buying it, right?

Ken Griffin: That’s a mistake.

Host: So do you regret it now? I am a journalist; I am being honest. I hold mutual funds but am not allowed to invest, so I missed out too.

Ken Griffin: That’s a pity, but of course, I wish I had bought those things that traded for 100 times their price a few years ago, right? We all have that psychology; it’s a universal human psychology. There will always be, "What did we miss?" And the second question is, I don’t care about cryptocurrency in terms of what problem it can solve for our economy.

Host: What do you ultimately think? Because you've mentioned many times what problems cryptocurrency solves and why we should address these problems. Do you believe that the entire cryptocurrency is just a crazy speculative bubble that will end badly, as Warren Buffett said, or do you think it will continue to exist in this digital form and make sense?

Ken Griffin: I think it goes back to a similar question of why people voted for Trump, because they want to break free from the constraints of government.

Host: So maybe it could have a future, right?

Ken Griffin: It might have a future. You have to remember that assets like this, an intangible asset, derive their value from intangible aspects, partly from the community and partly from the feeling of "I stand on the side against state power," right? People derive pleasure from that. I think one phenomenon we saw in this election cycle is that the American people are saying, "I want to take control of my life," and cryptocurrency is part of that.

Host: What do you think of founders of platforms like Polymarket? What do you think about people betting on elections now? Is this a market? Is this a field you want to enter?

Ken Griffin: I don't know; anyway, it's not what we want to do. But congratulations to Polymarket for building such an international brand with their huge bets supporting Trump in just a few weeks. I haven't spent much time thinking about this issue.

Host: Shane, he doesn't want to enter your industry. But I am indeed curious, since you now have a market where you can bet on various things, do you eventually want to enter this industry?

Shane: You know I'm a product builder; I can't say I'm a trader, but I do believe that everything having a market is inevitable, and this thriving situation is very exciting. And in my view, the biggest financial figures might underestimate it, thinking these markets are too small, but for us, it’s still an opportunity. I think, as Ken said, youthful naivety and entrepreneurship might mean that those seemingly small opportunities could become very big tomorrow.

Host: Maybe we will all end up betting in these markets. Before you leave, I have one last question. A few years ago, I don't know if you remember, you bid for a seat on a Blue Origin spaceship during a Robin Hood event, and you spent $8 million to buy that seat. Do you remember that? I do. And you gave the seat to a teacher. My question is, do you aspire to go to space yourself?

Ken Griffin: If you can live to 98, I will tell you.

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