Citadel's Ken Griffin Says GOP Policies Are Fueling Inflation (FULL)

Video Description

Citadel CEO Ken Griffin speaks with Bloomberg's Dani Burger at the Conference de Paris. They discuss Europe's financial revitalization, the US political landscape as affordability concerns push higher for the American consumer, and his outlook for the Federal Reserve in 2026. The Republican party is grappling with policies on tariffs and immigration that are fueling inflation, but its emphasis on deregulation will ultimately help stem price increases, Citadel founder Ken Griffin said. “The Republicans struggle with the reality that many of their policies which they ran on — for example ending illegal immigration into the United States — are actually pro-inflationary,” Griffin said in an interview at a conference in Paris Tuesday. “When you end illegal immigration, you reduce the size of the available workforce — that is pro-inflation.” Ultimately, though, deregulation “should unleash productivity gains that will create a reduction in inflation,” Griffin said. Federal Reserve officials cut interest rates for a third consecutive time at their meeting last week, but signaled additional reductions aren’t guaranteed. A number of policymakers are concerned about inflation that has lingered above the Fed’s 2% goal, while others have focused more attention on the labor market’s slowdown. Griffin also addressed what he sees as a split between t “The bond markets are expressing their anxiety about inflation,” he said. “You want to think long and hard about what rate do you lend money to the US government, which is running a staggering deficit and is now running a very easy monetary policy relative to inflationary pressures we are facing.” Future capital formation and investments made in the US that are funded with long-term debt “are actually being undermined by the easy monetary policy at the Fed today,” Griffin said. On the other hand, the equity market “loves an easy money story,” he said. “What you are seeing is a tale of very different investor groups.” While debt investors are anxious in times of deregulation and inflationary pressures, equity investors “thrive on this.” Griffin declined to say who his choice would be to replace Fed Chairman Jerome Powell when his term ends next year. But he said what’s most important is that distance is maintained between the White House and the Fed. In the wide-ranging interview, Griffin said Europe needs to address its longstanding issues, including what he said were capital markets that aren’t deep enough. “There is no doubt that the Western world needs Europe to be more successful,” Griffin said. “We need to see higher economic growth in Europe, we need to see more innovation, we need to see more demand for consumer goods and services, because the Western world will only be strong and prosperous if we have a strong and prosperous Europe.” Those comments add to a chorus of finance executives urging Europe to act as it considers how to respond to a global rollback of regulations imposed after the financial crisis. Jamie Dimon, JPMorgan Chase & Co.’s chief executive officer, said this month that “Europe has a real problem” because its slow bureaucracy risks driving away business, investment and innovation. Griffin, who has a net worth of more than $48 billion, according to the Bloomberg Billionaires Index, founded the hedge fund Citadel in 1990. He later established Citadel Securities LLC, the trading firm that serves asset managers, banks, broker-dealers, hedge funds, government agencies and public pension programs. In the interview, Griffin reiterated his skeptical views around the impact of artificial intelligence on the workforce.  -------- Watch Bloomberg Radio LIVE on YouTube Weekdays 7am-6pm ET WATCH HERE: http://bit.ly/3vTiACF Follow us on X: https://twitter.com/BloombergRadio Subscribe to our Podcasts: Bloomberg Daybreak: http://bit.ly/3DWYoAN Bloomberg Surveillance: http://bit.ly/3OPtReI Bloomberg Intelligence: http://bit.ly/3YrBfOi Balance of Power: http://bit.ly/3OO8eLC Bloomberg Businessweek: http://bit.ly/3IPl60i Listen on Apple CarPlay and Android Auto with the Bloomberg Business app: Apple CarPlay: https://apple.co/486mghI Android Auto: https://bit.ly/49benZy Visit our YouTube channels: Bloomberg Podcasts: https://www.youtube.com/bloombergpodcasts Bloomberg Television: https://www.youtube.com/@markets Bloomberg Originals: https://www.youtube.com/bloomberg Quicktake: https://www.youtube.com/@BloombergQuicktake