Bloomberg Audio Studios Podcasts Radio.
We want to go now to the Bloomberg invest conference taking place in downtown New York, where the Brookfield CEO Bruce Lass is currently speaking.
Take a listen, mantage of opportunities, and.
As long as you keep your eye on twenty years from now and the businesses that you're running, all of these things will be looked back upon as very short term items. This will not be what we're going through today, will not be relevant twenty five years from today.
It might not be relevant beyond this presidential term.
I'm just telling you twenty five years from now, we're going to look back and it won't be relevant.
You're thinking, and I did that time horizon.
We always think on those time horizons. Everything we do.
Not everybody here can afford to think like that.
Everything we do, or why we're in private markets is because we buy things for long periods of time and either we're going to hold them or it's in a fund where we may have to sell.
But what we need to do is to prepare.
The investment for the next owner that they will accept the next twenty five years.
And that's really really important.
To keep your eye on the long Ball.
I know that you are certainly competitive, competitive in your industry, competitive as an individual. Sometimes the how of the deal making process is important. The deal that I just mentioned, this nineteen billion dollar deal for these global ports, originated, as we understand it, with a pitch by Larry Fink, of course, who is a peer of yours, runs Blackrock directly to the White House and again thinking only in terms of the next four years, not necessarily twenty five.
From a competitive standpoint, is that the kind of thinking that you have to be operating with in.
Order to be competitive, in order to win, you know.
That kind of of access and that kind of I think under the circumstances deal making creativity.
You know, we're building the Intel fabrication plan for thirty two billion dollars in Arizona. We just signed a twelve billion dollars Microsoft Power contract to build renewables for them, largely in the United States. We just did a large deal in Germany with Deutsche Telecom with their telecom towers.
We just signed AI deployment.
Data center business in France with the French government for twenty billion. Our business is about facilitating our operating skills and amassing the large.
Sums of money.
We have to take on opportunities that are significant, and increasingly there aren't that many people that can compete with us just because of the.
Access to capital that we have.
You're right, there aren't many people who can compete with you. There were few, however, right, Some of them started in different places. Brookfield for many years was known as a huge player and real estate and infrastructure, and now, of course you're also huge in private equity and credit and renewable.
Energy and insurance.
But the others, I could name some of them, you know who they are, are following a similar playbook, right, trying to give clients everything that could possibly want under one roof concentrating more and more LP assets. It's been great for your stock price and for.
Their stock prices.
Is the future more of the same, which is to say, more concentration and more convergence, the biggest firms getting not just bigger, but more alike one another. Or will there be a divergence at some point with say a brook Field and perhaps another firm or two going in one direction and everybody else going in another.
I think over time, if you look at financial services, there's always opportunity for niche players, and there will be always that around the world, but there's increasingly concentration within large scale players, which as you note, are probably five or six today, maybe at seven or eight over time. And those large players look similar, but they're not exactly the same, and it's how they developed the access the capital that they have.
Available to be able to deploy their businesses.
So they're similar, but then they're not exactly the same. And it's not that one is better than the other, it's just they're a little bit different for various reasons, probably developed over twenty five thirty years.
One of the big differentiators in your industry now is insurance, a huge growth engine for alternative asset managers as a group of Brookfield of course included why is that business so appealing growing so quickly?
One of the last businesses in the financial services industry.
That had not almost it's now turned on its head.
We're in the business of in our insurance business is finding low risk liabilities and maximizing the asset value that we can generate on the asset side of the balance sheet. Historically, insurance companies made money from insurance and found somebody to invest their money, so the model's almost been turned like this. And our special ingredient to all of this is we have one hundred and fifty billion dollars of capital at
our parent company. We put almost twenty billion dollars into the equity of our insurance business, which we've just sold assets.
And put that money into the company, and.
We will continue to do that to build out the business over the next ten years. So because we have one hundred and fifty billion dollars of tangible capital, we can grow that business very significantly, and it both helps facilitate, of course, earnings in the insurance business, but drives our whole asset management franchise as well.
So if you were to take the twenty plus billion dollars of equity that you have in that insurance business now and add one hundred plus.
You know it ultimately could be all the capital we have up top, which is one hundred and fifty billion dollars.
That turned it into an insurance business with what in the way of assets.
It would just be turned up this way.
It would be an insurance business owning or asset management and our investment operations, which is really what Berkshire Hathaway is. It's an insurance company that owns investments intially.
Also what apollows has become.
Yes, they don't have an extra one hundred and fifty billion dollars in capital up top, but.
Yes, exactly.
So if you secute on that plan and we compare Brookfield with Apollo, because sounds to me like it's at this point or going to be a very useful comparison, what do the two look like at the end.
Of the day.
Look, our business has a very large asset management business, which is a trillion dollars of assets under management, a large insurance company that's getting bigger, and a very significant pool of cash, cash and assets.
That can be turned into cash.
What we do with those assets that can be turned into cash will decide over time. They may go in to we're insurance company if we can find opportunities, or we will redeploy them into some other financial services business, or we'll just keep buying stock back over the next twenty years. We'll have to see where it goes, and it'll all depend on opportunities.
Brucey recently predicted that there will be more consolidation in the alternatives industry.
Will Brickfield be a buyer.
As well, we are at the point where we almost have everything that we want. We have a few very simple metrics for things that could be additive to us.
But if something can be additive to us, that we can bring something to a group and that culturally we can see eye to eye and be partners, we might add in other businesses into Brickfield asset management, but we see no real need to pay up for anything at this point in time, just because we're a pretty broad We have a pretty broad array of products for our.
Clients and we continue to build those out.
I do want to take a minute and talk to you about AI in particular, because infrastructure is quite obviously to all of us becoming one of the gating factors in the ros of AI. Hundreds and hundreds of billion dollars being committed to AI infrastructure.
Brookfield as a player, what's.
Your commitment to date and what role do you see yourselves playing over time.
So we are the largest private builder of renewable power in the world, we're among the top three largest builders of data centers in the world, and we're continuing to morph the model into funding compute capacity for the technology groups.
That the number one the number one things.
Thing that stands between us achieving all of the models that will drive the AI revolution and productivity advances is the backbone of infrastructure around the world.
It's the singular one thing.
And so we continue to put enormous amounts of money behind these big businesses, and it's largely because our view is that the productivity advances that are going to come out of AI models in advanced robotics and services are going to be unprecedented over the next twenty years. And what that means is we're in the midst in the United States, but also globally, we'll in the midst of this enormous investment era, but it's going into highly productive, all right.
That is the Bloomberg invest Conference. If you want to continue to listen to the conversation between Eric Shasker and Bruce Latt, you can check it out on the Bloomberg terminal by typing live go and tune into the developments at Bloomberg Live