Bloomberg Businessweek Weekend: November 7th, 2025

This is Bloomberg Business Week, Daily reporting from the magazine that helps global leaders stay ahead with insight on the people, companies, and trends shaping today's complex economy. Plus global business, finance and tech news as it happens. Bloomberg Business Week Daily with Carol Masser and Tim Steneveek on Bloomberg Radio.

Hi, everyone, welcome to a special edition of Bloomberg Business Week. We are looking at some of our favorite guests from the Schwab Impact twenty twenty five event held this past week in Denver, Colorado. This event brings together advisors from around the country and those in the industry that support them with services and tools.

Coming up, we're going to hear from some familiar names folks like Liz Anne Saunders and Kevin Gordon and more. Plus so look at how AI is changing the investing landscape.

Yeah, we're going to talk about AI a lot. We begin with Schwab CEO Rick Wurster. Well some deal flow, Charles Schwab agreeing to buy Forge Global Holdings. It's a marketplace for buying and holding shares at private companies. It's about a six hundred and sixty million dollars deal we're talking about forty five dollars a share, that's about seventy two percent above the closing price on Wednesday. So delighted. I didn't expect to be talking to you so soon,

Well, we're thrilled to be able to democratize access to private investing. This is a market that forever has been for the high net worth and the ultra high networth, and with the acquisition of Forge, we'll be able to bring access to private companies to every investor. And so

It's been a lot of speculation about this company.

Yes, as you know, yes, well, you know there's stock who's down ninety percent off its highs and at the same time, they're the leader in the private company marketplace, and so for us to be able to acquire the leading company that has.

The deepest relationships with the private.

Companies and who have the stock opportunity, it's just phenomenal for us.

Rick, was it a bit competitive? And I'm just thinking about the premium that you guys paid. I'm thinking of was it Morgan Stanley just did a deal to buy equity Zen, which is another similar platform, So it does feel like big firms are jockeying to provide this access to their investors. So was there pressure to do this deal and get it done now?

Well, as a public company, Forge has to run a process and so absolutely this was a competitive process.

They've been pretty I think transparent about this.

Yes.

From our standpoint though, we think we're paying a very reasonable price where it's five times revenue less than what we trade on a revenue basis, and the opportunity for us in private markets is so much bigger than what we're paying for the company. We're paying six hundred and sixty million dollars for the company. This market could be huge, and when we bring our forty six million clients to this marketplace, I think the opportunity to grow our economics

Relative to the purchase price.

It was about democratizing access to private investing and to helping our clients grow their wealth.

Will this only be for accredited investors or what's the plan in terms of new product placement or product offerings to offer it up to the retail investor.

What I'm so excited about is we're going to have an opportunity for every type of investor to invest in alternatives with this acquisition. Well, three ways that clients can invest today. We already have for both our rias and retail clients a menu of alternative managers, the leaders that you're aware of, some of the big names in private equity and venture capital. That's one way our clients can invest.

A couple of questions I want to ask you, So, how does it kind of improve your ability to win more wallet share when it comes specifically to clients. We know that retail investors have been clamoring for more access to private markets.

I think we've gone I.

Know it's not about money, yeah, or I know it's not about in terms of the price you paid, but it is about right, Like you want to make sure your clients are happy and they're getting all the offerings. So I'm just curious, how does it help you win more share?

Over the last ten years, we've become a premier destination for high net worth and alternate high networth clients. And the reason for that is we have a product offer that can't be matched, whether it's access to privates, lending capabilities that are straightforward, fast efficient with great rates, wealth support on their tax, trust and estate needs, and access

What about from your rias? And I think about all the independent advisors who are here. This is what this event is all about. So how much does this kind of help them in their pitch to clients? And I'm just curious, is this to some extent in response to what you've been hearing from independent advisors?

It absolutely is, And this is a game changer for us in the RIA space. Today, we have five trillion dollars of RIA assets that we custody. One point two percent of them sit in alternatives. We know there's more demand that number probably should be closer to five, six or seven percent, And with this acquisition, we've now given them three different ways to get invested, and I expect over the coming years we'll see that one percent grow more towards the five percent. So the rias are thrilled.

We've nailed it.

And you said the new client offering, it's next year, we'll see it early part of next year.

Well, Forge is up and going today, so hopefully some of our clients will go find it and start getting invested if that's what they want to do.

But but I.

Have non accredited I think about like.

That will We're going to launch the fund in the first quarter of next year, that's the current plan, and then we'll continue to roll out their services in the coming months.

Again, you know, the other side of this rick is, you know, concerns about hurdles in terms of transparency and investors really understanding what they're buying when they tap into anything in the private markets. So are there any kind of hurdles that you anticipate, regulatory or otherwise.

That's why we really wanted to work with Forge, Okay, because Forge is the market leader in providing robust research to clients, and so clients will be able to access that level of research through four. In addition to that, we've also stood up a team of alternative investment experts at our firm that any client can call and talk to about, you know, a question they have about a type of alternative or a particular investment that they want to make. And so we really are trying to do

Is there a company you're most excited about that's on the Forge platform or that might be on the Forge platform.

At some point?

I mean, there's opening, there's anthropic. Is there any company that you're really excited about?

Not a particular one I'm interested in, but I am thrilled that there are a lot of people on our platform and a lot of people that listen to your show that are active in markets and they want to get into cracking because they love crypto or you know, they love el On Musk and want to get into SpaceX.

So that sex is another one.

Yeah.

I think that's what so interesting is that we find a lot of our investors do have these passions and now they're going to be able to invest in them through private companies.

So we know you took over in January, this is your first deal. Is there more em and a to come?

Like?

How are you thinking about what else you need to bring under the Schwab umbrella.

Well, with forty six million clients on our platform, we have an incredible opportunity to continue to add capabilities to serve and meet more of their financial life. The average fifty year older than fifty year old client has seven financial services relationships in their life, so we want to add more and more capabilities so they can handle more

And just one last question, mostly small, probably tack ons. I mean, you guys already have digested a large company, so I'm just curious or could it be a pretty significant and an a deal.

You know it's going to depend when again and we'll look at build by partner based on what capabilities we want to add, but I think we're open to just about anything. We want to grow our company. We want to do the best job we can serve in clients. We want to make a difference in their lives, and if there's a company or capability out there that we can add to our platform that's going to make a difference, we're going to do it well.

The market environment right now, we want to dive right in there, because really this week we've heard from different Wall Street executives that an overdue collection of weighed on the market this week so reduced expectations at that rate, cuts, a prolonged government shutdown. Michael Burry added to the negative tone with his disclosure of farish wagers on talent here and Nvidia. How do you see today's environment from sort of a risk reward perspective.

We try to focus our clients on the long term. I think that owning securities and assets over long periods of time will generally go up. It's really hard to get the timing of markets down because you have to make two correct calls.

First.

You got to nail it to get out at the right time, which is really hard. In the strength of the kind of market we've had in the momentum, we've had to get out at the right times incredibly hard, and then you've got to be able to get back in at the right time or you miss out. I was down in Charlotte, North Carolina, visiting with some clients and I heard from one client who back in twenty sixteen didn't like the presidential administration and so had sold

To get back in.

So as you walk around the floor and you're talking to advisors, I mean, what are they talking about, you know, in terms of timely advice that you're getting maybe from the advisors and what they are kind of hearing from their clients.

I think one of the most pressing topics from investors today is how to navigate concentrated positions, the S and p's as it's concentrated, as it's.

Ever been right, the mag seven, the big tech, Yes.

And it's created a tremendous wealth for lots of retail investors, and now they're wondering how to diversify their portfolio and to do so in a way to minimize their tax burden. And there's all kinds of strategies that they can work with their advisor on to create a more diversity portfolio without having to pay a tremendous amount in capitalating.

How hard is it, though, that when clients are like, but why would I want to get out of Nvidia when I've seen what they've been doing for how many years?

Like?

How tough is that? Because we constantly have conversations of people saying it's time to you know, broad nab back off the big tech, and then it's the big tech with so much momentum.

Well, you're absolutely right, and it's a really hard conversation to have and oftentimes we don't win it, but we want to make sure the client is cognizant of the risk and the choice that they're making and to be fair to those investors, they've been right by sticking with their concentrated position for the most part, because the names that have driven the market higher have been the same ones here for a while, and so many people are stuck with it and they are sitting on more gains

So let's go further into the retail trader, because they've grown about twenty percent of the US equity market today. I'm curious about sentiment trends, like how the structure of this trend, how resilient are retail traders in an eventual downturn. Why.

I think retail traders have been the ones leading the market higher and have been the ones buying the ditch. And I think they were out actually in many ways, out ahead of the institutional buyers. And so I think you have a retail buyer that has strong hands and we'll stick through the market. So we'll see how it all plays out. But markets go up and down, and retail investors will inevitably, you know, make some decisions in there that's best for them.

That's Rick Worster, president and CEO of Schwab, coming up more from our conversations at the Schwab Impact twenty twenty five events in Denver, Colorado.

Up next, we hear from Schwab Chief Investment Strategist Liz Anne Saunders and what she expects in markets for the rest of the year.

This is Bloomberg.

This is Bloomberg Business Week Daily with Carol Masser and Tim Steneveek on Bloomberg Radio.

We are back here on a special edition of Bloomberg Business Week. It's all about some of the highlights from Schwab Impact twenty twenty five. It was held this past week in Denver, Colorado. It's all about bringing together financial advisors from around the country. Those in the industry too that support them with various applications, services and tools. And up next we hear from a voice that has followed financial markets, Tim for a long long time.

Our conversation on markets with Schwab Chief Investment Strategist Liz and Saunders.

I'm so glad you're here.

Thank you.

Welcome to our cozy, little event.

Five people.

It's not cozy and it's not little, but we are happy to be here. It's a huge event. It was huge last year in San Francisco. It was huge before that in Philadelphia, you were shaking your head when I was saying everything is awesome.

Well, it's it's a.

Bit of a tale of two markets.

You've got cap weighted index returns and the lack of any significant downside, particularly since the April eighth closing low.

But here's an example.

The average member within the SMP just since April eight has had a sixteen percent now actually seventeen percent draw down. The average member within the Nasdaq since April eighth, when the nasdac's up fifty some odd percent, has had a average maximum drawdown of thirty six.

So this breath isn't there.

The breath isn't there, But there's a lot of churn and rotation going on under the surface that you don't pick up if you're only looking at the index level returns.

Are we starting to see signs where investors are kind of questioning some of the valuations that are out there, the AI spend and whether we're getting the return on investment on it. Tell us you're thinking.

OK, I think the margin of era has narrowed a bit.

There's obviously sensitivity, whether it is diminution in return on US capital, whether you're seeing pressure on margins obviously, the concern about the circularity of financing and the fact that so far that's a real thing.

I mean, we are kind of blown away. What feels like it's all in the family.

Yeah, here's five billion dollars, so you can buy five billion dollars with the stuff from us, right, You guys.

Like Bloomberg had this incredible visual that I think made it on Michael Burry's post.

Yes, but it's that is such a great visual.

I've seen more simplistic ones of a power strip with the plug plugged into the power strip.

Yeah, but that's exactly true, right.

And I think you know, the boom so far has been financed out of cash flows. It's been largely equity financed. But now you've got as to just pick on the MAG seven cohort MAG seven free cash low growth has gone from more than sixty percent year over year six quarters ago to now two quarters in a row of negative and so you're starting to see more deals financed with that.

That's not necessarily a bad thing. It's just a different environment.

But that I do want met in alpha that right, didn't they just recently do with oversubscribe, Like there's lots of investor interests, but I do like, I don't know, Liz what we just have to keep an eye.

On it, or I think you evaluation is a is a tough one. I think valuations and I'm going to say this generally, not just specific to AI stocks or Max seven. It's not a market timing tool. It's more it's more a temperature gauge than it is a timing gauge. It's almost an indicator of sentiment. There are times where valuations can get stretched, and they can get more ridiculously stretched, and the market still has a long runway ahead of it.

Narrative right now.

But it doesn't necessarily pretend impending doom. It's just a it's a cost saver AI and it boosts margins. So we had we had the really focus solely on the hyperscalers and the chips, and then more recently it's gone.

Into the energy usage in the data centers.

Now, I think where you're actually getting meat on the bones in terms of productivity statistics, in terms of the beneficial to costs is the users of AI.

And I think that is likely to continue.

But then does it create this destructive element in our society as a result of those entry level jobs, those white collar jobs, those blue collar jobs that end up being completely eliminated. I mean, I know we're talking about a future that none of us can see. But we had an interesting conversation with David Weston last week and he was basically like, how do we have this payoff without the money savings from getting rid of all these employees.

Basically, I think that we're.

In a moment of creative destruction to quote Trumpeter. Yeah, and that happens anytime we have a major innovation or we've shifted our economy from being an ag economy to industrial industrial to innovate.

And that happens. But ultimately new types of jobs are created.

I actually think that companies that don't adopt AI are going to have more job losses. I think what we need to bring in is what AI doesn't yet provide and maybe won't ever, you know, the seeds creativity and culture and community and connection context. So I think there's still I still think AI. Yes, it is replacing certain kinds of jobs, but I think it's replacing tasks more

You know.

I pulled up my phone because someone came up to us and Dwayne, who is a financial advisor, he's here, and he said, you guys did something on AI. I did. We did something at an event and we had somebody who showed how to use AI and you said. After that, I went home and started playing machacchi.

Because I have the panel you did at this conference last year in San Francisco.

No, it wasn't. No, I don't think so.

Okay, well it was something, but anyway, there's a lot of stuff.

But what he said is he was able to ask a questions. Do analytics so much faster? It was accurate And he said it just took less time and I actually produced better returns for my clients, which was pretty cool stuff.

It is a game changer. But the hallucination rates are still high enough. There are low school digits, but high enough that I think it was Gene Munster, he spoke right before me at a recent conference. Who who said, you know, llms are like an intern. They do a lot of them work for you, but you kind of have to check their work.

Got to keep an eye on them next six to twelve months. What do you think the investment environment looks like.

I think these bifurcations that have pervaded the economy, even the inflation data and obviously the stock market, I don't see a.

Convergence to any significant degree.

I think you're going to still see those bifurcations, whether it's from a capex perspective, AI or non AI, asset owners versus non asset owners, high income consumers versus low income consumers, tariff impact goods versus non tariff impact goods from an inflation standpoint, and then obviously all those by vifircations.

What I would watch for that may be interesting is we could have.

A situation where if some of the megacap names, some of the leadership names, continue to have some sort of pullback phase, watch what the rest of the market does. I don't think it's going to be extreme as late twenty twenty two. But what was interesting about that low in October of twenty twenty two relative to the low prior to that in June of twenty twenty two, is that when you had the real crush, there was greater participation under the surface.

That's what you want to look for.

That SCHWAB chief investment strategist Liz and Saunders. We turned out to our common conversation with Schwabs Jelina Kerr, head of Advisor Experience in Wealth Solutions.

My world is responsible for all things digital and investment products, banking solutions, and how you harness those together and help advisors extend them into their client base, especially the ULTRAHI network clients.

Who demand a lot of it a lot.

I was just I was shocked to see you've been at SCHWAP for more than thirty years.

I'm an old timer.

You're on the advisor services trading desks. The role of an advisor thirty years ago versus now, I mean those are like.

Two different jobs, vastly different.

Yeah, what are the expectations right now versus what they were thirty years ago?

The expectations are, frankly a little overwhelming due to the complexity of AI technology. Trying to figure out how to scale your business and still serve your clients. Those two things don't always just flow together seamlessly, right, and so the demands on advisors to really understand all the solutions that are out there. I think can get overwhelmed. I mean it gets overwhelming for me and I do it

Either does AI help with customization or does AI help you in your world at all?

AI does help us in our world. We are taking it more from an internal view right now. So think about our service professionals trying to enable them, making sure they serve advisors. We've got an a knowledge assistant that's powered by AI note taking those sorts of basic tasks we are using in house, and we are working with advisors to make sure they know what's out there and how they can take advantage of it right in a safe way.

Right, you want to measure twice, cut once when it comes to.

So, yeah, we're still finding our way.

What about alternatives? This is not a world that thirty years ago, you know, people were thinking about private credit, venture capital, private equity in their portfolios. Yeah, now it's like what that's table sticks, It's no.

Longer high yield as being like kind of something out there. It's very different, it is, and alts are a huge part of that.

I think some of the complexity though, is how do you connect the alts to the rest.

Of the portfolio.

If you've got a sixty forty alts have a role to play there, but it's not very seamless or operationally sound.

At this point.

What do they want in terms of alternative I mean, when we think about alternatives, we think about real estate, you think about some hard assets. I'm just curious, though, in a world where crypto is a bigger part of investing the private markets world, is it just it seems like NonStop that people have talked about for the last few years. What do they want in terms of alternatives? It really runs the gammut. I mean, I don't want to give you an answer that's a non answer.

But in a way, when you think about some advisors who are just really wanting to start inserting it, but they want to do it in a very well known name way, then you've got all the other all the way to the other end of the spectrum. Advisors who are creating their own right alts and weaving that into

There's some great leadership with some of our partners.

But that's so important for your clients because those are sticky. Those are what cause clients not to move to a different RAA. That's right, because you can't just get out of them.

No, no, you cannot.

And I think that's why advisors are at their heart right their fiduciary responsibility is to make sure their clients know they are a liquid you're going to be in this for a while, and they want to make sure they're educating their clients so that they're not hitting a point where the client's like, oh, yeah, give me.

All that money.

Sorry, can't do it right now.

So advisors have always been careful and cautious.

But given the fact that these have now gone from like a traditional five percent component of the allocation to ten to twenty, like it's growing and it's out there.

Chilia just got about twenty five to thirty seconds as you walk the floor. What are you hearing from advisors that you're just picking up on in terms of trends with themes and just quickly yeah, really quickly.

Automation which does tie back to the AI thing, but automation of those tasks construction management, transactional things that are not adding value and using API connectivity to do that. It's table stakes, yet people need help implementing them.

That's Jillianna Kerr, Schwab's head of Advisor Experience and Wealth Solutions. Coming up more from Schwab Impact twenty twenty five held earlier this past week. Up next, we move on from equities to fixed income and hear from Schwabs Kathy Jones.

This is Bloomberg.

This is Bloomberg Business Week Daily with Carol Masser and Tim Stenoveek on Bloomberg Radio.

Let's get back to some of our conversations that were this past week at the Schwab Impact twenty twenty five event. It was held in Denver, Colorado.

We turn now to our conversation on fixed income with Schwab's chief fixed Income strategist Kathy Jones.

You know, in general, the economy seems to be chugging along great. Okay, it's not great for everybody, but in aggregate it's good enough. Inflation is stuck at three percent and kind of edging higher.

Where do we go from here?

If you've got inflation at three percent maybe moving up in a four percent ten year yield, you know that's equilibrium right now.

We need something to change.

And do you think it's going to change?

I think in twenty twenty six we'll probably get enough slow in growth and some easing and inflation that will seeields come down. But I think the market was just way over its skis expecting the FED to cut over and over again. And it is very difficult to forecast all the time. But now between Daras on tarosof no data, policy shut down, policy making shut down, you know, I think the market's just.

Kind of the bomb.

Markets kind of just going going, WHOA, we're pretty well priced. Let's just sit here and wait for things to happen.

Well, So then does that increase the chances Kathy, you think of the having a policy misstep here.

It's certainly a possibility, But I think my impression that I get from Paul and from many of the other members is look, we're back to that's navigating on a cloudy night thing. Right, we don't have information, the Papa head isn't clear, and we've taken a couple of steps. We're not restrictive anymore. So now we pause and we wait and see what happens. Would go slow.

I'm a sailer and I've navigated at night and it can be kind of not so great. You can hit a rock, or you could hit something because you just don't read something correctly, or things can be smooth sailing. So is there a chance though that I don't like it? I think so many people are shocked at that the economy is still growing and we're kind of doing all right, and the market continues, the equity market to hit highs, not necessarily what everybody was predicting a few months ago.

Well right now, financial conditions have been very supportive, and I think that's another reason the Fed can kind of wait. They're saying, well, where there's no evidence that the level of interest rates is holding back the economy, people can borrow as much as.

Like housing still yeah, maybe, but I mean, you.

Know, even housing starting to kind of recover because prices are adjusting.

So, you know, what is the thing that gets us?

It's never the thing you're looking at in ther face, right, it's the thing.

You don't know.

I'm worried about the buildup of that, you know, behind the scenes and the shadow banking.

System, private credit, you know, to some extent.

We know that the quality isn't great there, and we know that some some firms are struggling.

So how would how would a crisis like that in private credit manifest?

You know? I think the issue is who's lending to the private credit folks?

Don't the banks lend to the private credit folks? Yeah, so right, what's their exposure?

Well, we don't know, you know it because private credit is private. You know, it's hard to know the quality of the assets in any given day.

Your face is really telling. Are you concerned that the exposure by the banks is a lot more than we know?

I think the banks, you know, no, I think the banks are the major banks are fine because against their will, they've been forced to hold a lot of capital since.

The Basil rules, And so I think the banks.

Are okay, but it does get to be sort of a cascade, right, you know, one thing leads to another, leads to another. A lot of interwoven lending takes place, and there's hidden leverage, and that's where you worry about things starting to change. I don't have any party to be on the spot. I know, I don't have any particular like this guy's gonna blow up.

We have a story to tell.

I'm just these are the ways in the past we've run into trouble. Somebody gets over leveraged, as the prices get out of whack, people are over confident, and then things change.

Right. So it kind of brings us back to the FED and how the FED works in an environment such as this, in an environment where it's not getting much data. We did hear from Lisa Cook this week. She said she sees the risk of further labor market weaknesses greater than the risk of inflation. Will pick up. Chicago Fed Presidentcy Schools we said he was more nervous about inflation.

Who's right, Yeah, we'll sign We'll find out.

I'll find out when we reach our destination.

Yeah, you know, I'm more in Goldsby's camp right now. Although the labor market is clearly softened. Some of that is supply side, right, So we got the ADP numbers today is a positive number. Who's just saying that that number isn't consistent with equilibrium in the in.

The labor So were these numbers accurate now?

Because well, ADP is as accurate as we can we can get right now. Yeah, but at the moment.

But when we used to get government data, we used to get the ADP numbers on you know, the day before, a couple of days before, I don't even remember the world. Yeah, we get earlier, and then we'd get the numbers from the government and they would oftentimes not even be close to one another.

Yeah, and that's true. I think part of that is ADP is private sector only. They didn't include government workers, so there's that discrepancy, and you know, yeah, their surveys are different, but it's all we've got to go on. So it looks like that they're picking back up a little bit and that's good news. The is M figures of the man fractioning figures were okay today, with prices paid continuing to fe that.

Schwab's chief fixed income strategist, Kathy Jones. We turned out to our conversation with Sam Kang, head of Family Office and Premier Wealth Group.

So you've got it's interesting because you've got a small number of clients but a lot of assets. I mean we're talking one hundred clients and two hundred billion dollars in assets under management. Talk about these relationships because are you working directly with the ultra high net worth individuals or are their family offices serving as a conduit to you?

Yeah, well we work with both, So updated numbers, we are actually now at about one hundred and forty relationships. We've now grown to two hundred and sixty billion just within the family office, so thirty percent growth just this year. In terms of assets, we've grown by fifty percent year over year, So there is a huge command to your question. We work directly with single family offices as well as professor managed multi family offices.

What is the definition right now of both hind net worth individual.

Yeah, so typically there's a wide range, but typically what we see is twenty million in investable assets, which really is about thirty thirty million in net worth.

You know, is it often the case of just managing everything and anything and then the past of that generational wealth. Like, give us an idea of what this all entails, because it's a lot of moving pieces, if.

Correct, Absolutely, it's a lot of moving pieces. It is beyond just financial planning and investments. It gets into reporting, but it goes far beyond that. It gets into family dynamics, family constitutions. Philanthropy that you just spoke about is a key factor in terms of that estate planning. You set family constitutions, meaning what so creating the core values of a family to identify how you want to spend that money down through in how you want to pass that

On the wealth.

You know, it's fascinating because we always I think when we talked about the passing on of generational wealth. We talked about like your offspring right your kids basically, but we've also had a lot of conversations about.

The way you're going sex spouses depending on the agreements anyway, go ahead and make them tight.

No, but passing on to women who tend to live longer and maybe their spouse their husband dies. But so talk to us about the specifics.

Is a lot of it.

Big families, lots of family members, is a lot of it. Thinking about maybe the husband passing it off to the way give us an idea of what so.

First of all, typically people just think it's passing down to the second and third generation.

What's going to happen for us is the media passing down to the spouse.

So as you're saying, roughly about fort five percent of that wealth is going to go to that spouse first and then it will get into the second and third generation. So, uh, there's multiple families that will be involved in this conversation. We also see, you know, when we think about the transfer of wealth, there is a lot of conversations about how you create the overall plan in terms of not just the investments, how you think about that investments over

Okay, let's cut to the chase here, death, divorced taxes. Those are the things that are you know, those are the things that are like on the redar of family offices.

We know that.

But I've also heard stories of like, all right, we need the head of our family office to find a new yacht captain right now, Bermuda. What's the craziest people.

Who do that around?

Yeah?

So so what's that that?

That is?

That?

That isn't the actual We've heard stories where a family fired their entire crew. One day, they come to the family office and they say, I need a new crew by tomorrow.

So this is the key distinction.

There are a lot of independent rias that want to get into the family office space.

What it really is, it's the very first call that these families make.

So you not only need to be there for their financial planning, their investments, but you really need to be thorough about all the capabilities that you need to be able to support our whole families so who are.

The people support that do that? So are we talking lawyers, Like, give us an idea of who has to be all involved in that?

Yeah, So at the center and think of it as a hubbet spoke model. Right, So if the center is a trusted advisor, we call that more of an expert generalist. That person then would reach out to lawyers, it state planners.

It could be.

Aviation loans, it could be bill paid, lifestyle constant services, healthcare conct of years.

So it really goes the complete spectrum.

Hey, last question, our team reporting that at least a fifth of the world's five hundred richest people now have a family office helping preserve fortunes totally more than four trillion dollars. That's according to the Bloomberg Billionaires Index. That was surprising to me. Why don't they all have family offices? Only a fifth of them do?

Well, I think there's more and more interest in creating that family office. So along that lines, it's estimated that seventeen trillion is within the ultra high network market, but only about five to six trillion is managed by a family office.

So I do think that there is a growing trend for these services.

That's Sam Kang, Schwab's head a family office and premier wealth group that does it for this hour of the special edition of Bloomberg Business Week, looking at some of our favorite conversations from Schwab Impact twenty twenty five in Denver, Colorado.

We're not done yet, still to come. More on markets with Schwab's head of macro Research and Strategy. We're talking about Kevin Gordon.

Plus Fred Kaine, or managing direct of Relationship Management for DAF Giving three sixty. We'll discuss the growth of charitable giving and use of donor advised funds. You're listening to Bloomberg Business Week.

I'm Tim Stenebek and I'm Carol Masser.

Stay with us.

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We're back on a special edition of Bloomberg Business Week. It's all about some of our conversations from the Schwab Impact twenty twenty five event held this past week in Denver, Colorado. Now, this event, held every year, is all about bringing together registered investment advisors, financial advisors from across the United States and those in the industry that support them with services and tools.

We begin with our conversation this hour Wishwab's head of macro Research and Strategy, Kevin Gordon.

There's kind of this internal turmoil right now in terms of the environment. Is it inflation we have to worry about. We saw that companies announced the most job cuts for any October and worth in two decades. This from Challenger, Gray and Christmas, and they did talk about an AI component to it. I can't figure out where we are.

What do you think?

You know, It's like the flavor changes almost literally every day. I mean it was much more labor driven. You had the Challenger data you mentioned, but you also had data from Avellio Labs, which has become much more important to look at in terms of private sector providers and what they're looking at for job growth. And what they showed for October was the decline of nine thousand for payrolls.

Of what you can expect. Yeah, oftentimes ninety days, right.

Plus I think the one thing that is I will say maybe a little bit more worrisome with the one for October relative to what we saw earlier this year, because there was a huge pickup and Challenger job cut announcements earlier this year, but most of that was at the federal level that was focused on what everything was going on regarding do this one's a little bit more broad based. As you mentioned, with the AI overlay, the concentration for the sectors was mostly in tech and warehousing.

So clearly this costs.

Cutting going on by companies, which is never a good feeling, no, And I think what's what's been interesting so far It's been relatively where it's gone sector by sector.

It hasn't been broad based across the economy, which I know. I've talked about this with you guys a lot and Lazanne you know who I work with closely on this, are the sort of this concept and thesis of rolling recessions in the economy. You're still experiencing that to some extent where it's not filtering up to the to the surface and it's not aggregating together to give you a full blown traditional recession. But it's still happening at pockets.

We know where as Lizan, we all call our Lizanne Saunders too. That's the Lizann you're referring to. So Kevin going from the corporate world and thinking about, Okay, what are companies doing with employees, How are they hiring, how are they firing, how are they announcing this to consumer spending because the consumer powers this economy. Yeah, we're getting some troubling anecdotes. What do you see?

You know, what's interesting is that when you look at I mean, this is where the labor market's so crucial to understand the differences between the stock and the flow. So the stock of labor is still relatively healthy. I mean, you look at a mostly fully employed America and that's where we're at.

Any of the layoff.

Activity we've seen, it's just at the mark and relatively minimal. So if you see relatively low layoffs despite a very low hiring rate, which we're basically at cycle lows, the fact that the stock of labor is strong means that the aggregate income growth month to month, assuming you stay employed, is relatively strong. So that's why real spending is still positive.

There are economists look at that bottom wrong.

You could break it down by wealth level, I like the FED data and looking at sort of percentile levels.

Of well in terms of overall economic growth and what the FED like, how do you think about This is the tough part because you know there's a social answer and then they're sight well.

The multiplier effect up the wealth and the income spectrum is just much stronger.

That's just the math.

And when you look at how well asset markets have done over the past couple of years, even this year, the bounce from the April lows, I mean, if you're benefiting from that as an asset owner, we have household exposure to equities at an all time high, beyond where we were just slightly, but still beyond where we were at at the peak in two thousand. So the wealth effect and the power of the market in terms of an economic driver has become quite strong and quite potent.

When you say full employment, do you how do you define that? And how does the FED define that?

Because relatively low and employment rate to history compared to history, there has been a little bit of an uptick. But you look at that and you look at overall payrolls and we're still right around you know, all time time.

But does it mean the person who's who's has the computer science undergraduate degree is working in computer science or working at Chipotle?

Oh yeah, exactly.

Fully, the question just sort of in nominal terms, looking at it face value, a job being a job, whether that job is perfectly matched with what the person is doing.

That's a little bit of how do we measure that well, because it doesn't that seems like a concern right now.

Well, then I think is going to show up, probably start to show up a lot more within the next year, in a lot of the labor flows that we're going to get because one of the you know, one of the longer term concerns I have for the labor market is what's happening right now in some of the churn with the pretty significant decline in immigration, but also not sort of the lack of replacement a lot of a lot of those jobs.

We're just not seeing that happen. And you see that.

Happening in you know, youth unemployment, black unemployment, it's really starting to spread in some of those pockets. So the areas that were supposed to benefit, you know, throughout this year, as you had more of a domestic strengthening in the in the fate of born labor force, it's not yet happening. So it's a little bit lagged. I hope it's delayed and not completely derailed. But I think in the next year, figuring out replacements for a lot of those lost jobs, that's going to be key.

And the reason I brought up the Chipotle computer science exactly well, always aungry, but that was what's be cited in that New York Times article back in August. Yes, computer science degrees having trouble finding those computer science jobs.

It's kind of this interesting environment we are when we look at the labor force. Hey, one of the things I want to ask you your team shared with us that you believe Tina is back, and it's not the Tina that we think about. There is no alternative in terms of like US difequities. Yeah, but it's something we started off with US government data. It is important no alternative.

I mean the depth and the breadth of the government data.

You just can't imagine and I think, you know, so far, thank goodness with the markets have been sort of, maybe in a negative way, whistling sort of passed the graveyard of no government data, but you know, they've been able to manage through with corporate earnings. I think that's been a nice bridge to get us to when the shutdown ends.

That's Kevin Gordon, Schwab's head of macro Research and Strategy, on site at Schwab Impact twenty five.

We turned out to our conversation with Schwab's Lisa Salvey, head of Bususiness Consulting in education. We held a Bloomberg AI Finance summit. It was just last month. We asked attendees in financial services, which area do you believe augentic AI holds the greatest potential to impact? And of course the agentic AI. We're talking about AI systems that can autonomously and maybe sounds a little scary, but autonomously plan

That's great.

But I know, I know, take over my world. I'm ready for it. So here's what the folks at that summit said the findings. Sixty two percent, Tim said the greatest potential would be an automating repetitive complex tasks and workflows.

Twenty three percent said generating alpha through faster deeper insights, eleven percent supporting strategic decision making across the enterprise, and then four percent Carol personalizing client experiences at scale.

All right, so let's see what our next guest has to say. She worked within Nebedda Advisors and their firms. Lisa Salvey's head of business Consulting and Education at Schwab Advisor Services. What did you think about those results?

They're interesting to me I'm I lead a marketing study here for ORAS specifically, it's like industry leading amount of data. We had about thirteen hundred firms participate this year. Sixty eight percent of our firms are using AI in some form. Twenty twenty five obviously that was the year of the note taker, right, so that's kind of the story. I think it's on like a basic level, they're using it.

Tasks and next steps.

So a lot of firms are saying that's saving them thirty minutes per client meeting, so that's a real ROI we're seeing, which you don't always see with AI all the time up to you know, I had one firm last week tell me two and a half hours of time savings.

So that's kind of the year what we've seen this year.

I think next year is going to be more of a two pillar type of year where you're going to see a lot of bottoms up type of projects and kind of citizen programming with the AI tools that are available within firms. But We're also going to start to see looking at larger scale projects that can actually build a transformative change or time savings in the organization. That will be approached more like a project agentic agents and agentic. That's kind of we're we're just stepping into that.

Pa're trying to play with that.

Some firms have it. Yeah, it's still very rare.

I think what I would like to see firms do is really start to focus on well, two things.

The boring one the data.

You got to get that data really good because AI doesn't fix that data, it just amplifies it.

Oh we know, yeah, I know, what about the finding alpha part of this, because that's interesting.

I don't hear that very much from registered investment advisors. I don't hear as much on the investment side. I hear it more on reading research reports giving them something to react to and on the poor fullio management site.

I will say one advisor came up to us and was talking about actually something I had done at a different event where somebody showed a demo and then got into like AI in a big way and said it did a lot of things like computations, different things and tasks, and he was able to create better performance for his investors because it just happened quicker and there are things he wouldn't normally maybe do or spend the time on because he just couldn't, and that he did and then yeah,

So, yeah, a lot of advisors.

Are not wanting it to hit the client yet. Yeah, so that's where that's going to be where we see some progression. But if you can create really comprehensive plans and advisors need to be prepared to their clients are going to start doing it and come in with something and that they're going to have to react to.

When do you think we start talking about AI, Like we don't talk about the Internet today, the idea that it's just this layer of technology that we're all using.

I think I think it's still changing so rapidly.

We're still seeing so many changes that we're going to be talking about it for a little while, especially as we get to that agentic layer. So first we're going to have projects. Then we're going to have agents that just do things like one off tasks like read a research report on its own and email it to you without you asking it to do it. Then we get to what you guys were talking about at the beginning,

We have a ways to go that.

Schwab's Lisa Salvi, head of Business Consulting and Education. Coming up. More from our conversations at the Schwab Impact twenty twenty five event in Denver, Colorado.

Up next, we hear from Omar Agular. He is the CEO of Schwab Asset Management.

That's next. This is Bloomberg.

This is Bloomberg Business Week Daily with Carol Masser and Tim Stenoveek on Bloomberg Radio.

Back here on Bloomberg BusinessWeek Daily, looking at some of our favorite conversations and highlights from the Schwab Impact twenty twenty five event it was held to him this past week. Of course in Denver, Colorado. It was a little chilli out there, well it was.

Yeah, it's Colorado. It's the foothills of the Rockies.

That's so true.

Yeah, three hundred days of sunshine a year though, so it's not bad.

No, it's nice to be out west.

We turned now to our conversation with Omar Aguilar, CEO of schwab Asset Management. Well, let's talk about this year, because as we were chatting ahead of this interview, you made the joke, I wish we could just end the year right here, because it's been a good year. It's been a good year, but what is that portend for the next you know, two months.

It's been great for investors. It's been great for investors to actually see that. I would probably say there were many points throughout the year where we all wish things were actually going to be different, and I don't think anybody anticipated, you know, that we're going to be at

You know, I was thinking about your background and I just want to lay that what you've got twenty five years of investment management experience and equity markets. You've seen a lot of cycles, and I know, I think I often reach out to you guys to ask you about this. What do you make of some of the recent stress that we've seen omar whether it was concerns about credit, some of the regional bank issues. Again, we've heard different stories about whether or not credit concerns were something that

Yes, it is.

It is interesting because yes, I have seen a lot of technics.

I have too, So we're just like a good bottle of wine.

You know, my gray hairs, you know, you know I take a pride of it.

But but yes, you know, it's interesting because you know what we what I have seen historically, is you actually go through the source of what is actually maybe the reasons why something cracks. There will always be in every single cycle, you know, areas of rest that are what we call ideasyncratic.

That's just such a fancy word, but you.

Know what that means is that there will always going to be things that will happen that will make people nervous, and we just need to understand whether it's systemic or is just isolated to a certain area. Interesting enough, you mentioned about, you know, the particular the credit market. You know, the credit market has been incredibly resilient since two thousand and eight, and I think when you look at the current even the high yield market, you know, is not

Is think that's not happening well.

And a lot of that has to do with corporate America.

You know, their balance sheets are fairly, fairly strong, and the amount of leverage that you see in corporate America has is basically to the lowest in many decades. So what that actually means is that yes, companies that are taking excess leverage to steps risk and they're more risky and the way they manage their business. You know, they're clearly more at the risk end, but the majority of America it's actually pretty solid in terms of how they

So does that mean that it's only a matter of time before we actually see inflation as a result of these carets. When these companies say we're not gonna we're not going to pad the impact anymore with our with our healthy profit margins, we're ready to pass these on, well.

We're ready seeing some of that. We're ready seeing two things. One is we're ready seeing companies that are they're not going to have a choice, but actually passed through those increasing process to the consumers. You know, we have seen those companies that have the biggest you know, opportunities and the biggest, widest margins. They are they're already good, but there are ones that are getting a squeeze and a squeeze we're already see some of that already in the

You're starting to see a little bit in.

Terms of like you know, airlines and the tickets and you know, you see that actually on my way here for the first time the plane was not full. That that was unique because you know, for the entire year, you know, you always go there and it's actually big, big chunk of it. So you can see a little bit of that consumption starting to just get affected by it.

This happened to us last month on our way back from Los Angeles. The person at the gate said, this is crazy. It's been full pretty much until now. The flight was empty heading back.

Yeah.

Again, it's an anecdote by hearing it from airlines yet.

But the airlines have and so smart about keeping those planes packed right, and so to me it seems like a clear indicator. I know, I said, you've seen a lot of cycles, but I think about your background Lehman Brothers,

Well, we have seen and actually we saw this in the last six weeks.

If you if you look at the performance of those companies that did not do not have positive earnings, negative earnings companies in small and MidCap sectors, they outperform by almost twenty percent in.

A short period of time. So what is called the junk rap.

And in many cases, the concern is that this component of excess goes into areas that goes like that, and that volatility is not healthy.

Omar, thank you, always always appreciated. Omar Agailar. He's CEO and CIO of Schwap Asset Management. All right, so let's share some numbers with you.

Check this out.

Sixteen thousand independent advisory firms, five trillion ten in assets under management.

That's the business that John Beatty overseas. He's managing director and head of Schwab Advisor of Services. He joined us on site here at Schwab Impact twenty twenty five in Denver, Colorado. John, you've been at Schwab for close to thirty years.

Let's say twenty eight, Just so tell myself too. Okay, it's twenty.

Eight, twenty eight years. You've been a member of the advisor services team for sixteen years. It's correct an ria today versus what it was sixteen years ago. They want different things.

Well, it's amazing.

When I first joined Schwab twenty eight years ago in the advisor business, we custodied a one hundred billion dollars for assets. Now it's five trillion dollars.

So that just gives you where is that in market share?

So advisor services Charles Schwab has about forty four percent market share of independent advisors, doubled the nearest competitor.

So we were first to the space back.

Then almost thirty eight years ago and have really focused in on it and made a main priority here at Schwab.

And we've been rewarded by our clients with their growth.

You know, my in laws are we're talking about their financial advisor, and I was telling about this conference that I was coming to, and they said, we had a choice when we signed up with this financial advisor who we wanted as a custodian. We could choose Schwab, we could choose another company. Is that that was surprising them. I didn't know that RIA has had relationships with different custodians.

Yes, RA industry is the industry of independent advisors, and independence means that they have choice is who their providers are, whether that's custodian or asset management, fintech providers in their back office. I think that is actually the secret sauce in the RAA space and that everybody has to be at their best every day to maintain their seat at the table, whether it's us as a custodian against our competitors, or a fintech provider in the back office an asset manager.

Keeps everybody lead me and competitive. So what do investment advisors really need from you guys today?

So really, where the hallmark is, where the foundation and relationship is our custody experience, which means opening accounts, moving money, doing trades. The basics that the advisors want to be brilliant in how.

They serve their clients, so easy, secure, what.

Easy, secure, accurate, All of those things matter important and the last thing an advisor wants to do is have their custodia or any of their providers embarrass them in front of their clients. So we have to be at a ninety nine percent accuracy rate and everything we do for advisors, and that's why we're winning in the marketplace is those brilliant experiences that we provide.

What's the toughest thing in making sure that you guys are hitting on all those things, the accuracy, the security, all of it.

Yeah, it's really the move from paper to digital and that's that's a change management thing in our industry. So we've made great progress in the last five years on that. Now, for example, moving money wires ACCH transactions, we're ninety three. It's the ability to move money overnight without a wire, got it?

Yes, forget me.

Yeah, it's an industry academ Sorry about that, but we're at ninety three percent rate there where just five years ago that was less than fifty percent. So what what what digital brings is it brings faster, more accurate, less errors in the ecosystem, new accounts. You know, we're opening on a digital platform at about a fifty to sixty percent rate. We'd love to get that in the eighty to nineties, so that brings modern experiences for the investor.

As well as the advisor.

I was talking to one of the independent advisors before our program started and he was telling me, He's like, Okay, I've got this whole machine that runs Linux, that just runs my Bloomberg terminal, separate machine, separate keyboard. Then I've got my other two monitors, so two monitors over there, and then I've got my other two monitors with basically the Schwab dashboard and everything that that Schwab offers that I can then offer to clients.

What is that?

Oh, it's what is that tool? What is that dashboard?

So our website is the place where we serve advisors digitally Schwab Advisorcenter dot com.

In that tool, you'll find all.

The logistics of custody, moving money, opening accounts. We have trading capabilities on that website and a lot of other features that advisors can dig in. You know, the industry has changed over over the years, and now we have our I rebounld capability, which is a is a automated rebalancing tool.

We have model market center where advisors can tap into pre built portfolios.

So advisors are really looking to outsource some of the things that you used to do in house so that they can use their time in other ways with investors around planning a state tax, those value added places.

How much in terms of advisors from what you guys are seeing, how much are they doing like face to face or phone calls or actual conversations versus so much that they can do either digitally, Like I'm just curious what.

That mix is.

Well, it has to be a combination that they want to free up time to do yes, yes.

And there's nothing that replaces being in person with your client. And we had Kesseleigh talking about the need for social interaction. So what really advisors are trying to bring is a recipe of digital experiences that take the less value activities moving money and transactional work so that they can use their in time person with clients on more of the intellectual psychological aspects of investing. AI very briefly, Yes, going

How much back and forth is they're with advisors and you guys about what we need in terms of AI.

It's about our ecosystem.

We want to AI enable them on the custody side, and then they need to AI enable their experience with their clients related to the portfolio and other aspects. So it's going to play a big role in this industries we go forward, John, thanks so much for joining us.

Their chatbot that's like, hey, Chuck, how do I do this?

We have a knowledge center tool that our service reps use that is a and I enabled that makes us smarter on the phones with advisors.

We'll turn that onto advisors at some point.

Okay, not yet, once the learning is done right, all right, some baby, thank you so much, really appreciate it. Managing Director, head of Advisors Services at Schwab.

Coming up more from our conversations at the Schwab Impact twenty twenty five events in Denver, Colorado. Coming up Fred kaine Or, managing director of relationship management for DAFT Giving three sixty talking about the growth of charitable giving and the use of donor advised funds.

That's coming up next. This is bloomber.

This is Bloomberg Business Week Daily with Carol Masser and Tim Stenoveek on Bloomberg Radio.

We're back here on Bloomberg Business Week looking at some of our favorite conversations. It was all happening at Schwab Impact twenty twenty five, the event held in Denver, Colorado this past week.

We turn now to our conversation with Fred Knor, Managing director of relationship management for DAFT Giving three sixty. We talked about a lot, specifically the growth of childable giving and the use of so called donor advised funds.

A donor advised fund is essentially an account set up to facilitate charitable giving. A donor advice fund is comprised of three different components, contribute, invest, and grant, so a donor, with the support of its advisor. His advisor or her advisor contributes cash, securities, appreciated assets including real estate, collectibles, private business interests, and alike. We accept those contributions, we liquidate them. If they're appreciated assets, we deposit them into

Should everybody be considering donor advised fonds or do you need to have a certain level of wealth for it to make sense?

It's going to say yes, yes, really though really yes.

I mean now, it's a good question.

A lot of people think that, you know, a donor advice fund account is set up for the ultra high net worth and the ultra wealthy, and the answer is no, it's not. There's no minimum to open an account. You can have an account with effect a zero balance. Many people open an account for testamentary purposes. They will fund it upon their passing to fulfill their charitable legacy. When you're young, you don't necessarily have a lot of assets to give to charity. So you don't have to give

Ready to give.

But why open it early if you don't really have anything to contribute to it.

It's a great question uestion. And they do it for a variety of different reasons. Like I said, one is when it's used for testamentary purposes. When a person is planning their legacy. When they're planning sort of they're trying to think about what they want their legacy, charitable legacy to be beyond their lifetime, they would fund upon their passing.

So that's what I want to talk about is control here. How much control does the person who put the assets in there, who had the assets who don'tate the assets have where those assets go or where that money goes.

That's a great question.

So technically, when the assets are put into the donor device fund account, they relinquish control of those assets because those assets we are, as you said at the beginning, we are a five oh one C three nonprofit. They are effectively making a contribution to a nonprofit organization, and

Grants and when so two questions, where do they Where are folks often saying here's where we want those assets invested, and then where are they saying they want to donate.

That's a great question, and there are a number of different investment options and it really is up to ultimately the donor and the advisors supporting the donor on how they choose to balance their portfolio in terms of an investment strategy.

Many of because I wonder if it's about growth or it's just about maintaining the principle or a little bit of both.

Yes, it's both. Mostly it's both. People want to do a variety of different things. They want to maintain the balance, they want to grow it over time. And an interesting is is we have seen almost four billion dollars in growth and incremental growth as a result of utilizing a very effective and prudent investment approach while the assets are in the account, so above and beyond what they've contributed.

So I interrupted you, so where are folks investing? And then where are they donating, so they're investing in a variety of ways.

Some people want to invest around impact investing, for example, they want to do things with SRI s G.

Actually that's even growing.

Impact is an evolving term and it means different things to different people, but yeah, that's a big thing. Others are investing in sort of much more conservative investment options where they're much more focused on maintaining the balance and making sure that you know, it's not subject to the same.

Investment volatility as others.

So it really the answer to your question is that they're investing in whatever way they feel most comfortable investing those assets if it's for impact and that impact has you know, as social returns in addition to financial return and in other cases it's just really maintaining the balance, making sure that they have those assets there to be able to grant a charity whenever they choose, and.

Then ultimately where does that money go.

So yeah, so then the third component is granting.

So we allow grants to any organization that is a five oh one C three nonprofit and good standing with the IRS. Our database. We rely on the IRS database that is about two million strong right now. So really it's up to and it's in the flexibility of solution. It goes to wherever they choose to support it. It could be their house of worship, it could be their alma mater, it could be providing grants to disaster relief organizations when floods occur in Texas or fires occur in California.

Any place that they cannot donate just real.

Quickly, it's not really as long as it's a five oh one C three a nonprofit organization and good standing with the irs generally speaking, those that we fulfill those grant recommendations.

All right, so appreciate this is really fun. Fred, thank you so much.

Thank you guys very much for the time.

He is managing director of Relationship Management for DAFT Giving three sixteen independent five oh one C three Public Charity fully known as Schwab Charitable Tim and I here at Schwab Impact twenty twenty five. Now you might recall over the summer it was in August President Trump signing an executive order directing the Labor Department to reevaluate guidance to fiduciaries to get them more comfortable with including private credit,

Kind of on pause right now, at least at the SEC level because the government shut down. Yes, but still this seems to be the direction that things are.

Moving all right. We have a great guest to get into on all of this with some thoughts and here at Denver in Denver at Schwab Impact twenty twenty five, Kyla Culver, she's head of real and Controls for Schwab Advisor Services. Good to have you here. There's a lot going on that could change, or there's a lot that is going on that means we won't see changes. How are you assessing kind of the regulatory environment and things that could change what investors can be investing in.

So I feel like for advisors it's a lot of whiplash right now. If we look at the prior administration and SEC Chair Gensler, there was constantly new rules coming out, and it was just like regulation overload for people. And now under Paul Atkins, we're expecting to see a reduced

To allow that.

What direction do you see that moving in? If it does get approved, if it if it happens, if the SEC says okay, this is totally fine. Is everyone going to be Is it going to be like us having stocks and bonds.

In our life?

I don't think it will be for everybody.

I think that we see it well everybody at the option.

Well, it's going to be up to the plan administrator. So who's ever sponsoring that plan. They're the fiduciary. They've got the ability to say you're allowed to invest in X, or you're allowed to invest in you know, not allowed.

So would I be at the company level for a certain company and it's employees, or would it be at the whoever they decide as the planned administrator like an empower for example, it's.

Really like the planned sponsor who's choosing that.

So why would a plan sponsor say no? Why would a plan sponsor say yes?

I think they would say yes if they wanted to give their their participants, you know, additional choices. Some plan sponsors may say no. You know, we see it on the Schwab side where we've got some plan sponsors that have opted into our Personal Choice Retirement account offering where you can basically have your four oh one K and you know, self direct it invest in stocks and bonds and things that are outside of the allocate the plan allocation.

Is it a good thing?

I think it's you know, choice.

Is always a good thing. So more freedom of choice. But as long as people are doing it smartly with it, you know, the advice of an investment advisor. I think it's a sparked decision, but I think there's always additional risk there.

Well, the risks are right in terms of all assets. Some things are not as liquid or as others, and you need to understand that if YNGI to be able to get out of something it's not liquid like stocks and bonds exactly in many ways.

And that's why I think doing things with the advice of a professional versus just you know, your friend told you this was a good investment, it makes more sense that way.

On the regulatory front, and having advisors have less regulation right now, does more fall on them in terms of making sure that they're doing what's right because those those regulations aren't necessarily in place, and I know kind of a judgment for me to say, you know, quate regulations with right, that's not what I need to do. But we know, we know the DNA that that Paul Atkins has the SEC chair when it comes to this stuff, and he's much more laisse faire than other SEC in the past.

Yeah, So what what we keep reminding advisors of is just because there's you know, all this noise about deregulation and less new regulations, you still have to follow the fiduciary duty you still have. You know, there's still regulations on the books, there's still rules. Who still have to do all the things and be making sure you're in

That Schwab's Kayla Culver, head of Risk and Controls over at Schwab Advisor Services.

And that does it. For this special edition of Bloomberg Business Week featuring some of our conversations and the highlights from the Schwab Impact twenty twenty five from the Schwab Impact twenty twenty five event in Denver, Colorado, this past week.

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Find our Bloomberg BusinessWeek Daily podcast at Bloomberg dot com, Apple, or wherever you get your podcasts, and the latest edition of the magazine. It is available on newsstands now at Bloomberg dot com and always always on the Bloomberg terminal. I'm Carol Masser and.

I'm tim Stenaveeck. Have a good and safe weekend, everyone, stay with us. Today's top stories and global business headlines are coming up right now.