Anthony Scaramucci: How Inflation and Populism Change Financial Advice

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Anthony Scaramucci has had one of the most public and fascinating journeys in finance over the past decade. His story is ultimately about resilience, reinvention, and what it takes to recover when life hits hard. Hi everyone, I'm business coach Steve Sandusky for Barron's Advisor, The Way Forward Podcast. My guest today is Anthony Scaramucci. He is the founder and managing partner of SkyBridge Capital, which is a global alternative investment firm, and he has long been a prominent voice at the intersection of investing, politics, media, and entrepreneurship. In today's conversation, he reflects on how his life has changed since he and I first recorded a podcast together back in November 2016, which was just one week before the presidential election. He shares what he learned from one of the most difficult stretches of his life. Including repairing his marriage, rebuilding his business, and finding a new sense of perspective after a very public fall. He also offers his views on the deep structural problems facing the US economy, why so many people feel left behind despite strong markets, and what he believes political and business leaders need to do differently if we want to create broader prosperity in the years ahead. He also discusses the rise of Bitcoin and blockchain, why he believes financial advisors need to pay attention to exponential technologies, and how he sees the role of advisors evolving as AI, private markets, and economic disruption continue to reshape the landscape. With that, here's my conversation with Anthony Scaramucci. I don't expect you to remember this, but on November 1st, 2016, you and I recorded a podcast And it was one week before the election. And at that point, you were still running SkyBridge. You were hosting Wall Street Week. You were writing about what you called the jagged line of entrepreneurship. You were serving, I think, on Trump's economic advisory team. We talked about failure, resilience, vigilance, and how success is rarely a straight line. Now, of course, what neither of us knew at that time was a week later, Trump was going to get elected, that he was going to get elected a second time. And that the next decade for you was going to be sort of testing the ideas that we talked about in your book that you had recently written about entrepreneurial success and failure. And so, your next 10 years was going to be very public, very consequential. And so, I'd love to hear, as you reflect back on 10 years ago and you look at the Anthony Scaramucci of today, what would you say are some of the biggest learnings or insights?

You know, I remember the conversation because what we were talking about, Steve, was Hopping Over the Rabbit Hole. And we were talking about how you have to turn sometimes failure into success and how you can't take yourself too seriously. And to your point, after I got my ass kicked in the White House, I had to adopt a lot of the things that were in that book and turn that book from just a fun book to read to actually a playbook in terms of how to recover and survive the Trump administration. But here's the things I would say. I would say that if you or anybody listening is ever having a bad day and it's not cancer, uh, it's not a health-related reason, I can probably cheer you up. So let me set the scene for you. On the 31st of July, 2017, I had missed the birth of my son. He was born on July 24th. I was with President Trump at the Boy Scouts event. My wife, about a week earlier, had filed for divorce on me. We were fighting for a number of different reasons, but one of 'em was her real dislike of the president and who he represented. But there were personal reasons too. I'm not gonna just make it about that. And my business was suffering because Trump is a polarizing figure. I think we could stipulate that on your show. And so if you like Trump, you probably were with me in my business. If you didn't like Trump, you probably fired me. Okay. And you wanted to protest with your feet by firing me. So I, I got unceremoniously fired. A divorce was filed, missed the birth of my son. My business was hurting. I was lit up by every late night comedian. I was torched by most cable news pundits and most editorialists around the world. So you have to go from that moment to the rebuild, and you have to go from that moment to How am I going to reframe the argument? How am I going to dust myself off and get back in the game? And so, I worked on repairing my marriage. It's 9 years later. Thankfully, that's worked out very well. I worked on repairing the business. We ended up pivoting a large part of the business into the digital asset space. Thankfully, that worked out well. We were buying Bitcoin at $16,000. Today, it's trading at $80,000. It fluctuates, of course, but— you know, a purchase price of 16 versus 80 has been very good for me and our clients. Uh, we rebuilt our conference business. And what I would say to you is that the last 10 years have been humbling. The last 10 years have made me more psychologically minded, uh, perhaps way more empathetic towards other people. And I think it's also given me a perspective, and weirdly, it's given me a platform to talk about these issues and entrepreneurship but also other issues, political and otherwise. So it was really rough, Steve. Not going to sit here and mince words, okay? It was really rough. I'm not going to code it over. And I made some really bad decisions that you could sit around and regret. But here are 3 things I'd say quickly to your viewers and listeners. Number 1, if you're an entrepreneur or business owner or running a business, you probably made some mistakes. And so forget those. You got to get up, And you gotta leave that millstone of regret behind you. I don't kick myself in the pants in the morning and say, I once got fired from the White House 9 years ago. I've already moved on and forgiven myself. And you have to forgive yourself in the business world for mistakes. Second thing I would say to you is that the whole ballgame is relationships. And so even though you and I don't see each other much, I agree to come back on your podcast because you're one hell of a guy. You're, very well respected in the industry, and you're a decent, fair person. And a result of that, I would imagine you have a web of relationships around you that have helped you in your business and helped your family. And for me, that is the end-all be-all. It's worth way more to me than money. It's worth way more to me than owning another Bitcoin. When I got fired from the White House, the lesson of my life was if you're nice to people, you're trying to be helpful to people, and you're trying to create good karma and wins around you, a lot of people will come out of the woodwork to help you when bad things are happening to you. I do have friends of mine, political and otherwise, that have fallen from grace, and they were mean-spirited and rude and caustic. And it's sort of like what your grandmother said to you, "Be nice to the people on the way up the ladder because you're gonna meet those people on the way down." And my lesson to people listening in is do a good job and try to be helpful to people in a nonlinear way. Because if you do that, if bad times should come upon you, and I wish that they don't, of course, well, there'll be a layer of people there to support you, you know? You know, Michael Milken called me the day I got fired and said, "Hey, you've been very good to me. What can I do for you? How can I help you?" Okay? And there was a legion of people like that that did that. Of course, you remember those people, Steve.

You do.

Yeah.

Well, I appreciate your very candid thoughts here. And you mentioned the word relationships. And of course, we all know how important that is. I'm curious, as you think about all the people that you have met and worked with, let's say, over the past decade and even prior to that, and back when we talked in November of 2016, you had a— you certainly understood all the warts of President Trump, but you also had some optimism about what his presidency might bring about. And I don't want this to be all about Trump because it's certainly not going to be, but just more the general idea of what have you learned about trying to read people, about trying to understand who's genuine, who's not, who's, who's acting, who's not acting, who can you trust, who can't you trust? Because so much of what financial advisors do is about building trust and reading people and knowing who's genuine and who's just trying to work me over for something.

Well, listen, I've taken a lot of risk in my career. You know, as you well know, I grew up in a blue-collar neighborhood, blue-collar family, didn't have a lot of gateways or portals into the world of finance or Wall Street. And so I took a lot of risk in my career to build my career. And when you're taking exogenous risk like that, you will make mistakes in judgment, investment mistakes, you'll misjudge a person. I would say, and I wanna be very fair to President Trump, I would say President Trump has identified something, Steve, in our country that we haven't solved for yet. We took a generation of people. My dad, who was a crane operator, was an aspirational— he was an economically aspirational blue-collar person. In 35 years, 40 years, we turned those people who were once economically aspirational into economically desperational people. And Donald Trump observed that. He capitalized on that from a political perspective. He saw their grievance. This is a grievance that's manifested itself in some level of anger. And frankly, he's become an avatar or a representative of that anger, which is the reason why he has— I mean, his approval rating right now is 33%. There's a group of people stay with him no matter what he does because they see the system is broken. And they see the system as unfair to them. And so when you're talking about people and judging people, I looked at Donald Trump at age 69 ascending to the presidency, that he had a fairly accomplished business career and that he was gonna try to take the country in a post-partisan, uh, more transformative direction. I did not see the default switch into full-on populism or the default switch into this sort of American nativism and this anti-immigration fully. Yes, I understand. Well, he talked about building a wall and things like that, but if you looked at the immigration policies in 2017 to 2021, they were more or less identical to Barack Obama's and more or less identical to George W. Bush's. They got way more caustic in Trump too, but I would say that You gotta be very careful in life of imbuing onto somebody that something that you wanna see that isn't there. And what politicians do a very good job of, Steve, is they have different people who see them differently. You could see Barack Obama through the prism. If you're right-leaning, there's parts of him you like. If you're left-leaning, there's parts of him perhaps you like more. But there was enough of a kaleidoscope emanating from Barack Obama that different people could see different things and, and like him. And Donald Trump was very, very good at that as well. So look, we can debate Donald Trump and the practices and the policies. I would submit to you that we have a bigger problem today than we did 10 years ago. And I'll leave you with this statistic before you ask me another question. Realtor.com is saying that the median house is $383,000 in the United States. So Half of the houses are worth more than that. Half of the houses are worth less than that. To be in a situation where you're not house rich and cash poor, you're a financial advisor. You got to make about $170,000 to clear that mortgage, the utilities, the taxes, and to have some disposable income and savings. The median income in the United States is $83,000. And so we've taken that notion of the American dream and we've rendered it effectively an impossibility for half the people, Steve. And it's a problem in the country and it's an anger-based problem. And if we don't fix that, we're gonna see lots and lots of people drawn to populism. It could be right-leaning populism or left-leaning populism, but it'll be away from the establishment. And I would just argue, and this is an indictment of both parties, I would say that there's been a bipartisan laxity of serving those people. And they do serve the corporate interests. They do serve big business, big pharma, big food. Lots of money has flowed into the system since the Citizens United decision in 2010. And so therefore the money is coming from the big guys and the big guys are getting their legislative agenda put forth. But the little guys are really suffering. And I'm just telling you, it's not gonna end well if we don't wake up and make an adjustment. And so weirdly, I'm gonna give Donald Trump credit for seeing something, wreaking havoc over what he saw. And hopefully enough alarm bells are going off in the country now where very smart citizens that are civic-minded, love their fellow men and women, will start thinking about serving the public as opposed to serving their own personal power.

Well, I appreciate that. Here's the disconnect, though, and I'd love to get your perspective on this. So the stock market is hitting all-time highs. And so from the stock market perspective, if you look at employment rates, they're pretty high. We're starting to see some wage growth. Yet all the problems that you identified are clearly significant problems that are really not effectively being addressed, and they haven't been being addressed for a long time. So How do you sort of describe this disconnect between markets and economy seem to be doing good, yet we still have this really deep structural problem between really wealthy people and less wealthy people and economically advantaged people and economically disadvantaged. How does that disconnect continue to work like that?

I see the K. So I see the people that own stocks and own assets doing quite well. I see the corporate interests doing quite well. There's a huge CapEx cycle. Going on right now in the economy. It's affecting AI. It's also affecting the infrastructure spread around energy that AI needs a tremendous amount of. And I see that affecting a very large group of people that you and I live with. But I also see the other side of it where there's a group of people that are not benefiting from that. We've had high numbers of small business failure. We've had high numbers of unemployment in the way I would like to measure unemployment, which is the U6 number. And just to remind viewers and listeners what that is, you know, in our country we have lies, damn lies, and then we have statistics. And so if you are looking for a job longer than 12 months, you come off the unemployment, and we're printing a 4.6 unemployment number. But if you add in all the people that are still looking for jobs That's the U6 number. And that number, by the way, used to be the number— like, when I was a kid in 1982, we didn't have this U1, U2, you know, up to U6. And so we're at 7.9%. So the unemployment is quite high. The participation rate— so meaning people that have just left the job market— we're at an all-time low on participation rate. Okay, 1% of the households are controlling 31. 7% of the nation's wealth at this moment in time. That's the highest level that it's been since the end of World War II. Okay, the richest 10% of the Americans now own two-thirds of the total wealth in the United States. And so I'm telling you that we have to be very careful to not get the collective biases of the people that we hang out with. You and I are market participants. You and I work with wealthy individuals and large-scale institutions. They seem to be doing well. We seem to be doing well. Therefore, we're doing well. But there's the man on the street. There's the woman on the street in a blown-out city that's lost their manufacturing base, where the unemployment is high. And this is a number that my research staff gave to me, and the link is from CNBC, so I can send it to you. But I want to give this to you. The bottom 50% are holding just 2.5% of the overall wealth in the country. Moreover, they have substantial debt loads, credit card debt and otherwise. And so, yes, I hear you. I'm doing well and no one's going to write a charity check for me or for you or for the people in this relatively affluent neighborhood that I'm living in. But I want you to see it from a median Black household. Who— a median Black household in the country, 15% of the country's population, the median net worth is $44,000. That's 15% of the median white household. So I'm telling you, there are bad pockets of things that are going on, and they're going to show up in Zohra al-Madani. They're going to show up in right-wing populism, left-wing populism. And I can tell you that If you looked at these numbers when we were kids, these numbers were narrower. Uh, there were higher middle class and lower middle class blue collar wages. I priced for President Trump in 2016, my dad's wages from his union. And I told him his 1976 wages priced 40 years later. So the same exact job on Long Island, adjusting for inflation. My dad's purchasing power would've been down 26%, Steve. So, we just want to point this out to people. And the inflation, you're a brilliant money manager. If I come to you and I say, "Hey, I have these assets. I just sold my business. I need you to keep me ahead of inflation." You know exactly what to do, but I have assets that I can give to you that you'll put into a portfolio for me. That will help me outpace inflation? Well, let's say I don't have any assets. Let's say I am a crane operator on Long Island and you are paying me a dollar and I put that dollar in a savings account. Well, guess what happened? From January of 2020, according to Truflation.com, the US dollar lost 28%, 28% of its value. So think like a laborer. You give me the $1,000, I now have $720 of purchasing power, sir. I cannot catch up, and I don't have the assets to come to your wealth management group, uh, to give me the proper advice to stay ahead of the game, you know. And by the way, I will tell you, and this doesn't reflect well on me, it wasn't until I worked for Donald Trump in 2016 I didn't see how glaring these disparities actually are. Because I frankly wasn't trafficking in enough areas of the country that had exhibited this.

Yeah, well, as you point out, the K-shaped economy is totally real. And to your point about Trump was able to tap into that and understood there's a significant percentage of our population that has not kept up with sort of the average of the economy and the folks that are certainly doing really well here pulling up the averages. So that absolutely is real. So let's just say it's January 2029 and President Scaramucci is getting inaugurated.

What is president? Don't wish that on me. I'm going to kick your shin under the table here.

I'll tell you what, I'll be your finance manager.

How's that? Okay. Yeah. Well, I know the money will be well managed. Okay. Keep going. That's right. Okay.

So given the challenges that you've identified that our country clearly faces and has been facing for many, many years, what is President Scaramucci going to do? Like, what are some of the policies that could be put in place that might help us get out of this hole and not exacerbate the issues, the problems we're dealing with?

So, I mean, this is such a great question. And so what would have to happen, which is very unlikely for it to happen because unfortunately we have short-term cycles. But what would have to happen is I would, if I were the president, I would put up a website and I would say, here are the areas that I would like to reform. I would tell the American people that we're in our 253rd year and we need reform. We need constitutional amendments. We haven't had many in the last 35 years. Uh, the Constitution's been amended 27 times since 1789. So that's roughly 7 or 8 amendments turn every decade. We don't have that now. We've had 3 decades with no turns of the amendments. And I would call for an amendment that would end gerrymandering. We would have a protocol in place that we would even out these congressional districts and make them competitive again. And I would say to my fellow Americans, are you in a real democracy where the politicians are picking the voters? I thought the voters were supposed to pick the politicians. That's number one. Neither party wants that, by the way, because they lose control. The second thing I would ask for is to end Citizens United, because Citizens United has perversely affected the democracy. We've created a separate but equal democracy. The wealthy are getting what they want in terms of tax breaks and big businesses are getting what they want. There's 7.5 times more money being spent by large businesses and wealthy people since the Citizens United decision was rendered, and I would want to get people back to serving the American public. Then I would say you got to have a 25-year plan to reduce the deficit. You're not going to reduce that deficit in a day or a minute, not possible, but you could slow down You can't doge the government. I said that repeatedly. But what you can do is you can slow down the growth of the government so that it underpaces our GDP growth. And if you did that for 25 years, you would curb the deficit as a percentage of our GDP. And this is a very vibrant, very dynamic, exponential economy. If you look at what goes on with robotics, AI, all the different things. And so I would tell people they needed a 25-year plan for that. They've gotta right-size the K through 12 education system. And we have to have a platform of healthcare for the nation's youth. And we gotta feed 'em because 40% of the kids that are going to school right now, Steve, are going to school hungry. And when they're asked, well, why are you not doing well in school? They say, well, I can't think, I'm hungry. We have 40%. I'm not making that number up. 40% of the public-educated school students are going to school at the elementary school level hungry. And so I would say, just really sorry, it's not socialism. This is about creating a platform of equal opportunity. I'm all about unequal outcomes. I want the Steve Sanduskis that have worked super hard and built successful businesses to have unlimited upside. Uh, Jeff Bezos, Elon Musk, Please have unlimited upside. You're creating a lot of economic rent. I would then take the corporate leaders in the country and I would show them a chart and I would say the economic rent that's distributed between labor and capital, when it's at 50/50, the country is incredibly happy. When it's higher than that and it's more distributed towards capital, and we're 53/47 right now, it is really bad for the country. It wreaks havoc on the country. And you would be better off creating a flywheel of more disposable income by paying your workers more money so they go to Walmart and buy more things, which would create more economic activity, than taking it all for yourselves. And here's the irony. I gave you the numbers. 1% of the population owns 31% of the assets. Okay? So you literally have one— you can give 50% of the profits to 1% of the population and give the other 50% to the other group, and you can have a very happy country. But you can't do what we're doing right now as people are trying to approach trillionaire status without any grace, savoir-faire, or no police oblige. You can't do it. It's not gonna work. You're gonna end up in a barbed-wired McMansion while your fellow neighbors are suffering. And so this is a Teddy Roosevelt approach. He did this with the robber barons. I would be more specific. I'd be more data-driven than Teddy. He got him into the White House up on the second floor in the Treaty Room, which is now the Lincoln Bedroom. And he's beating their asses in and told them they had to knock it off. And Henry Ford went back to Michigan and he doubled the wages for his employees in the assembly line there. And he said, hey man, they gotta be able to afford the car that they're producing and they need a good school system and a good house. I don't want them descending on my mansion with a tiki torch and a pitchfork. And so we gotta do that. And so those would be the steps that I would take immediately, but I would lay it out on a website for everybody to see. And I would say, by the way, this is not gonna work in a 4-year plan or an 8-year plan. This is a 25-year plan. And after I leave the job, whoever it is, a Democrat or a Republican, I would like to pass the baton to them. So that they can continue to execute this plan. We used to be good at that, Sandusky. The Truman Doctrine lived for 40 years. The policy of containment that Truman and Atkinson and George Marshall developed to push back communism lasted from 1948 to 1989 when the Berlin Wall came down. And it didn't matter if you were a Democrat or a Republican, you adhere to that policy of containment. And we would have to do that from an economic consequential behavior. We'd have to do that from a resource expenditure behavior. And we could fix these problems. These are, these are very fixable problems with the right type of leadership.

Well, we're gonna get the transcript of this, and then I think we've got your presidential platform right there and everything that you just said there.

So, Dusko, I'm just, I'm running, I sent to the HCA, I'm running for reelection of my marriage. Okay, I'm just trying to stay married.

I know.

Okay. And by the way, I could be term limited in this marriage. Who the hell knows? You know, that's right. I'm just trying to stay on the straight and narrow.

Okay.

All right.

So a couple of things about what you just said there. So one is one of my daughters is a public school high school teacher. And so she would very much appreciate the comments that you just made here, because in fact, just a couple of days ago, we were talking to her and she was talking about the very issue that you brought up about the kids in school and how so many of them are hungry and they can't pay attention and so on and so forth. So another example, you being spot on here, pointing out some of the, the problems and issues that people deal with. So I appreciate you sharing that. The other thing you mentioned was the debt and the deficit. So you and I, we're both in our 60s. We remember the Reagan era. We remember the 1980s when it was all about, oh my gosh, the deficit, it's out of control. And I think it was like, I don't know, $1 billion or $2 billion. I mean, it was something ridiculously low relative to what it is today.

Right.

Yet here we are. The economy is still going and, and yet we're still talking about the deficit. So as you think about— I mean, I hear some people say, oh, well, we've got AI and we're going to have unlimited GDP growth because AI is just going to start doing everything. So do you think that we're going to be able to grow our way out of the debt like you were describing? Let's get the GDP to grow faster than the rate of the debt growing and we can get on a better trajectory. So do you think we can literally grow our way out of our deficit problem?

No, we can't grow our way out of the deficit problem without concomitant curbing of the growth of the spending. Now, we're not going to have flat spending because that will never work in this country or that government. But if it's growing, the spending, which looks like it's going at 5 or 6%, if we can flatten that out to 3%, okay, and we can get the economy growing at 3.5%, okay, or possibly 4, you could see a major transformation. And by the way, last time we were in a situation like this was at the end of the Second World War. We had deficit to GDP of about 125%. And, uh, lest anybody forget this, we never paid back that debt, but we grew the economy so that it was manageable. See, what's happening now is we are going to pay back the debt. But we're gonna pay back the debt through the most pernicious, most regressive form of taxation. And that's inflation. If you remember Milton Friedman, who was one of the icons of the '80s, Milton Friedman said that this deficit spending is a disaster because all deficit spending is, is unfunded tax liability. Somebody's gonna have to pay it. And you can pay it by paying taxes. And defeesing it, or you can pay it by printing more money. But guess what printing more money does? It kills the poor people in the country, Steve. It kills the lower middle class who don't have assets. And so we're, we're taking the easy way out with the deficit now by monetizing it. You know, gold went from $35 an ounce to $4,300 as an example of that debasement. So I believe, yes, you could do this Okay, and you can't be running a $1.9 trillion deficit, which is 6% of our GDP, when you're at quote-unquote full employment. You can't be doing that. We're operating at our best when we tax ourselves at roughly 20% of the GDP and we spend on ourselves roughly 20% of the GDP. We're taxing ourselves right now at 19% of the GDP and we're spending at 26 and a half to 27%. It's not going to work. If you made $1 million a year in 2000, what is the equivalent that you have to make today? Now, according to different inflation calculators, it's $3.5 to $4 million. Think about that for a second. Is that— are we crazy? And what are we doing? So if you made $100,000 a year in 2000, you have to make $400,000 a year today. To just catch up. How many middle and lower-middle-income families can say that they paced for that over the last 25 years? So yeah, it's, it's doable, but we don't have a lot of room here. You know, we have a lot of mandatory spending. We have entitlement spending that's mandatory. Uh, the president wants to move on a trillion and a half dollars of military spending. Now we don't have a lot of maneuverability here.

And hence Bitcoin, since we're talking about inflation, and we'll get to that here in just a moment. You mentioned Milton Friedman. He's also famous for saying that the sole purpose of a corporation is to maximize shareholder value. And so that was a big mantra for, for several decades. And then we had a, what appears to have been a brief flirtation with, you know, sort of stakeholder capitalism, where it's not just the shareholder but it's also multiple stakeholders. And now that seems to have been beaten back here. A little bit. And I think that really leads to sort of a broader idea that I want to talk about with you as well, which is, you know, it used to be stocks, bonds, and real estate that we would invest in. And today we've got Bitcoin, we've got all these alternative assets, we now have all these prediction markets. We can bet on how many times Elon Musk is going to tweet in a day or whatever. I mean, it's just crazy, all the stuff that we have going on. So I really enjoy talking to you because you cross so many different currents, whether it's media, whether it's politics, whether whether it's investing, whether it's culture. I mean, you have your fingers in a lot of these different areas. So, talk to me a little bit about how you see markets and everything sort of evolving, the narratives that go around these, this idea of nihilism, financial nihilism, where some of the younger generations, as you were pointing out, people that are really— it's difficult for them. They're like, "What have I got to lose? I'm just going to bet it all on Robinhood or Bitcoin or all these other crazy things, the prediction markets." Where do you see all of that leading? And again, if you're President Scaramucci, is this kind of financial innovation— is this all wonderful and let's just— the best is going to win out in the end? Or how do you think about all those things? It's sort of a big question, and take it wherever you'd like to go.

You have to think in a non-traditional way. And how do you think in a non-traditional way? You got to say, okay, that military's got to get redesigned. That military was set up for the Cold War. It was set up for uniform on uniform. We haven't fought that way in 70 years. The Korean War was really the last time we fought uniform on uniform. And so that whole military has to be redesigned. There's some great technology in that military, but there's also some cumbersome, unwieldy, unworkable technology in that military. So that's step one. Number two, okay, you gotta step back and you have to look at the AI. And I would say to people that we need a robot tax, because if you're gonna fire 20% of the people, that's the estimate, okay? That's a coming white-collar job apocalypse, and that's gonna upset a lot of suburban soccer moms, and it's gonna also influence the way they vote. But if you're gonna fire 20% of the white-collar jobs and it's gonna be replaced by the robot, well then you gotta tax the robot. You have to tax the productivity of the robot, and you may have to set up some type of income insurance or some type of wage insurance for people as they're trying to repot themselves into different jobs. You're probably going to have to cut the workplace down from 5-day work week to a 4-day work week, okay? Because that'll also create new businesses in terms of leisure and entertainment. For people that are not working. And so there's a whole host of things that have to get done and have to be thought about. Okay? You can't just sit there in the status quo and say, okay, we're going to have 20% of the jobs are leaving. What are we going to do? Can't do that. You got to have protocols in place and safety nets. And we did this when we mechanized labor and we allowed the unions to form and we created structure to the work week. We went from 7-day work weeks in most of the industrial nations to 5-day work weeks. And then we said, okay, it's gonna be a 40-hour work week for hard labor. And this is how we're gonna formalize it. We have to rethink all of that again. So that's labor legislation, that's technology firms getting together to make this happen. It's not just status quo, Steve, you know? And so, so we'd have to think about all those things. Those conversations are not happening in Washington. Okay, no one's talking about a robot tax, but if the robot's gonna replace 20% of the workforce, you gotta tax the robot. You know, there's gotta be a wage garishment from the robot's productivity.

Yeah, well, that's definitely an intriguing idea for sure. How are you thinking about, so you were fairly early in Bitcoin blockchain. How are you thinking about the financial innovations there? How are you thinking about Bitcoin today, blockchain today? Obviously, in the past couple, 3 years, there's been a lot more opportunity for people to invest in those, a lot easier for them to invest with the Bitcoin ETFs and those sorts of things. So what are you thinking about those areas right now?

Well, I mean, it's a very long, deeper intellectual conversation. And you referenced, which I'm mad at you for, you referenced that we're both over 60. I would like to lie about my age, Santos.

Well, but I got the gray hair. You got dark hair.

Well, yeah, I could introduce you to my colorist. Anytime you want to meet my colorist in New York, we can fix that. Okay? Because you could look 10 years younger because you got a full head of hair. God bless you.

But I'm just a silver fox here.

I think you got to stipulate whether or not you believe that digital assets are a permanent fixture of our society and is Bitcoin specifically emerging, evolving into a store of value? And so if the answer is yes to those questions, and again, I'm not saying Bitcoin is a store of value today, It's too volatile to be considered that. Although gold recently has shown a lot of volatility, ironically. But I'm just saying that, do you believe as Bitcoin matures, it will be perceived as a store of value? If the answer to that question is yes, then you have a monumental opportunity in Bitcoin because Bitcoin is $1.5, $1.7 trillion of market capitalization versus its competitor gold, which is $25, $27 trillion in market capitalization. So even if you got to 80% of gold, and I would make the case that Bitcoin is more mobile than gold, it's easier to store, it's easier to move around securely, needs less insurance, all the different things I could say to you, you would make the argument that not a 60-year-old like you or me, but a 30-year-old could get very comfortable with Bitcoin And someday that 30-year-old will be 50 and they'll have Bitcoin as a part of their portfolio. The same way when the internet came about and people were using email, I had some of the older partners at Goldman Sachs didn't want to get on email, didn't even want to try it. And we were using it, but then the internet was a quote unquote fad. That's what Bill Gates called it in 1994. But it wasn't a fad. We ended up now doing trillions of dollars of business. And so I would ask people to not think of the blockchain the way it is today, But think of the evolution of it, the way we were sending AOL emails to each other 30 years ago. We had this clunky device under our desks that was whirring and burring, that motor, the modem, if you will, that was logging us into the internet.

1200 baud modem.

Yeah. Dial-up service. Now you've got gigs, you got 2 gigs coming in, and you've got billions of people streaming 4K video and trillions of dollars of transactions happening. So, I would ask people not to look at the blockchain technology of today and its clunkiness and look at it where it could go and what it could become. And I would also tell you, you could ChatGPT this. There's approximately $4 trillion of transaction verification globally. That's a credit card fee, a wire transfer fee, a closing statement at a bank where the attorney gets a fee to make sure all the paperwork is properly processed. And so if you have $4 trillion of transactions that need to be verified, imagine over the blockchain you could cut that in half, or you could cut that by two-thirds. You could have $2 or $3 trillion of money that flows back into the economy for innovation and for economic growth. So I want people to get on the bandwagon to understand where the future is and to just get off of zero. And so for me, I own a lot of it. I probably own more of it than any financial advisor would advise me to own because I believe in it. But having said that, if I were a financial advisor, I would be saying 1, 2, 3%, get off of zero. You don't have to own a lot of it, but you have to own enough of it. Because if I'm right that it goes from $1.5 trillion to 80% of the market capitalization of gold, it goes to $20 trillion, uh, you'll be very happy that you owned it, and it'll add something to your portfolio.

So since we're talking about financial advisors, you have talked to, you've worked with a lot of financial advisors over the decades. As you scan the horizon and you see what's going on, earlier we talked about some of the, the economic challenges of our economy and a lot of the issues that people are dealing with. We've talked about the upside of technology, about AI and potential growth in the economy. Financial advisors obviously control the direction of where a lot of clients' invested money goes. So, what advice, suggestions would you have for financial advisors in the years going forward in terms of how they should be thinking about their role as an advisor, how it might be impacted by AI? Maybe some additional societal good that advisors can do in terms of how they might encourage clients to do, you know, with their money?

Listen, it's such a great question, but I mean, let's just start with the basics of that question, which is that where I've had the greatest measure of success is on the smallest things. I didn't do this, but if I put $500,000 into Anthropic 5 years ago, it's worth $140 million today. Okay, now I didn't do that. I'm not saying that I did that, but I'm saying that there should be some money in your portfolio that you are designating for some of these new ideas and these new technologies. Because I do believe that we're gonna go exponential. There will be an AI drug discovery firm, a pharmaceutical firm that has, uh, the AI The smartest people have 200 IQs. The AI will have 20,000 IQs, and they'll be running drug testing simulation on every compound in the world, anything that's in the ground, on a tree, in a plant, part of the soil, to test to see if we could use it to help our bodies heal themselves. And that's coming. There'll be robots that are AI configured that will make robots. And those robots will be cleaning your house or potentially caring for an elderly person somewhere in our society. And that's coming. And so we need to have a little bit of money in that. Have, have a little bit of money here, a little bit of money there. So I, I would tell people, wake up to the exponential opportunity. Okay? You may end up having a hyperbaric chamber, in every house in America. And you may even get a government subsidy for it. You say, what the hell is he talking about? Well, Medicare may say, you know what, it's cheaper for me to install the hyperbaric chamber in Steve's house as long as I know there's a punch card there and I keep track of him going in and out of the chamber, 'cause it's gonna reduce the inflammation in his body, and a result of which it's gonna structurally reduce the, expenses associated with the healthcare. You and I both know that we're a fatter group of people today demographically than we were in 1991. Well, it turns out all that fat has added $2.5 trillion of healthcare expenses. If you're telling me GLP-1s, red light therapy, oxygen therapy, all these different things are gonna change that, well, I would want some of my money in that. I'm not here to talk about my products, of course, but just explain this to you. I have a late-stage private equity product. So we buy Anthropic, we buy SpaceX, we buy Klarna, we buy Chime. Some of them have worked, some of them haven't. But the notion that there's a new economy coming and there's always really good ideas in the economy, I wanna be part of that. And again, I should own the S&P, and I should own some bonds, but I'm talking about a small slice of action in what I call these new areas. Mm-hmm.

And, uh, speaking of products, I think you have a book coming out later this year. Is that right?

I do. I have a book coming out about, it's sort of a 35-year observation of the economy, some of the economic policy decisions that we made, which have weakened the economic base of half the country. Some of the stuff Some of the stats that I gave you are in my book about the have and have-nots in the economy. And also, uh, the title of the book is All the Wrong Moves: The Three Catastrophic Decisions That We Made as a Society That Have Led to the Systemic Rise of Populism and the Further Wealth Disparity in the Country. And, but I also provide in there, so, and you and I have talked about some of these things, some of the solutions that we could implement to fix those problems. First thing we got to do is understand how we got here. And then we could acknowledge that and then work on ways of fixing it.

So we started off with like a 10-year look back of the Anthony Scaramucci 2016 to today. Let's go 10 years forward. Okay.

Yeah.

Whether it's a Scaramucci presidency or not, I'll still have brown hair.

Okay. I'm on planet Earth.

Yeah.

I'll still have brown hair. Okay. Yeah. Maybe I'll convince you to go brown, Steve.

Okay.

Yep.

We'll have a podcast 10 years from now as well. So what are you thinking about the next 10 years? If you could sort of wave a magic wand and make it happen the way you want, what does that look like for you? For you?

Well, I mean, you know, my— I mean, not that this is— you're cheaper than my therapist, but I mean, obviously I want good things for my children. I have 5 of them. 10 years from now, I would want them to be well on their ways of their independence and well on the ways of pursuing the passion that they have in life and hopefully living some level of fulfilling lives. Hopefully my wife still likes me 10 years from now, and we're out traveling somewhere. And, you know, hopefully I'm still here. But I mean, I would say professionally, I'd like to still be working Most of my family members have worked well past the age of 65. And so I would be 72 at that time. I'd like to think that I still had a relevant job and I was having some fun somewhere doing something.

All right. That sounds great. Well, any final thought, comment, observation that you want to leave us with here today?

Oh, just that the world gets better. We worry about things that don't happen. You know, Thomas Malthus said in the mid-1800s, we're going to run out of food. We made more technology to make more food than we ever thought was possible. You know, we have more people dying of obesity prior to GLP-1s. We had more people dying of obesity than from starvation. You and I were told in the mid-'80s in college, we're running out of oil, running out of oil. And when are you gonna run out of oil? 2010. Okay, well, it's 2026. GPS, satellite technology, offshore drilling rigs, the improvement of air conditioning, the improvement of of different energy efficiency techniques in cars and buildings and homes. We have more oil than we know what to deal with. And so we don't, we worry about a lot of things that don't come to pass. I think my message is a hopeful message that people need to relax and bet the future and be long-term in their investment orientation and not get overly read into the media, overly concerned about things that are going on short-term.

All right. That's all for today. Make sure you like and share this podcast through your favorite social platforms. And for more great podcasts, visit us at barons.com/podcast. Take care and be safe.

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