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We are in the midst of the largest wealth transfer in history right at this very moment. So one hundred trillion dollars of wealth is going to next gen and millennial clients over.
The next decade.
So that has some pretty significant implications. But in addition to that, women are controlling more and more global wealth. Today they control a third of global wealth, but in the next five years, thirty trillion is going to pass in the hands of women, and they're going to control over fifty percent of the global wealth market out there.
Today, Welcome to the City of London, the City of the City, the City of London.
Please mind the gap between the trial and the financial hearts of the country, the.
City, the city.
Welcome to in the city.
Stand clear of the doors.
Peace.
I'm front Sine Lacwaw in the London studio. Now on this week's In the City, we debrief on Bloomberg's first Women Money and Power event in London, which brought together
senior women across finance globally. You just heard one of these women, City Group's private bank head idly now her comments on the spike in female fortunes happening right now and how that is transforming investing around the world was one of the key themes covered across the day, but other key topics included the outlook for private markets and what the return of Donald Trump to the White House
means for markets and economies. So for today's episode, we're going to unpack these topics and some of the other key takeaways from the event. With me to do that, EMBA News director Ros Matheson and from our UK and Middle East Finance team, Jenny s Sorain. So welcome both to in the City. Jenny, you were in charge with others of this live blog out of go.
It was really great.
There were so many I think surprising moments from the day where, you know, kind of heading in, I thought we would hear a lot about one thing, and then
we ended up hearing a lot about another thing. So like one of the big takeaways for me was really even folks that I think are huge owners of public equities or kind of traditional fixed income you know, bonds and things like that, they were really big on private markets and so we just continuously heard about that all day long in terms of how big that market is growing, what risks folks are worried about kind of getting embedded
as that market grows where they're seeing opportunity. So I thought that was that was sort of one of the more interesting takes from the day in terms of, you know, here are these women that are managing humongous portfolios of equities, and yet they're looking kind of beyond for what's next.
We had rolls, you know, senior suite from like City Group, Female Leadership, We had to Morgan Stanley, we had Jenny Johnson of Franklin Templeton, and we had Santander and I guess the common pattern was you have all this money that needs to be invested, so it's not that it's being taken out of money, it's just shifting around.
Well, that's right, and that was where it was very interesting to see where they're looking to put money. It's interesting to see when he was saying the conversation around private markets. It was also striking to me the way that people talk about passive investing, which is interesting because they were also citing the kind of term or that the planet is in and how unpredictable things are, and yet you know, looking a lot towards the rise of passive investment.
But was really striking to.
Me was the way that people are very optimistic about the US as a market with the incoming presidency of Donald Trump for the second time. They're really upbeat about the outlook for the markets there for dealmaking there, I guess seeing Donald Trump as a very transactional president who'll just want business to get on as usual, but alsobeat on the US economy and in contrast, by and.
Large, very downbeat on Europe, worried.
About the political see situation in Europe, worried about the outlet for labor in Europe, and certainly there was a very big contrast from some of the senior women yesterday on that.
I completely concur with Allis's perspective around regulation. It's got to get obviously better than we've had in the US under the prior regime, and I do believe it'll be kind of industry specific, because there's certain industries that might have slightly different dynamics around m and A and consolidation, But in general were quite bullish.
There was a lot of focus on deal making in twenty twenty five, so I don't know whether there was almost too much optimism after the last couple of months where there was a lot of turmoil in the markets and a lot of acts of the Trump tariffs because Jenny so they were very bullish on deal making in twenty twenty five, and also the tariffs were kind of minimized. You you know, a lot of them on stage said, oh, this is a negotiating tactic. It's just to get a
better deal. It's the art of the deal. We're not sure that Donald Trump falls through with it.
Yeah, that was definitely the main vibe on the tariff front, which is interesting because you know, it's hard to know if if he really will follow through on on so many of us, so much of what he says, but definitely folks who were kind of discounting the threat of tariffs and absolutely thinking that he will follow through on
everything he's said on deregulation. So we had a really great panel towards the end of the day where I think it was Christina Menez from Goldman Sachs, Alison Harding Jones from Deutsche Bank, and they were just talking a lot about, you know, the idea that so much has been on hold under the Biden administration because he's really put forward this image of you know, I'm gonna be hard on anti trust. I'm going to put every deal
under review. And these guys are saying, you know, that just meant that a lot of clients didn't even bring anything to the table. And now, you know, we've got this new administration coming in. He's promised so much deregulation. We'll see who he puts at the top of all these different agencies. We really feel like kind of the animal spirits are coming back to life, and and we've really had a lot of client inquiries coming in and so it'll be interesting to see if that comes true.
We did have it.
There was so much back and forth because I think so many people are hesitant to say, you know, twenty twenty five will be this big, huge deal making frenzy. I think it was the former CEO of now West, Alison Rose, who she was talking a lot about how she thinks that we'll see a couple of one in one hundred year events, which is kind of scary. But she was basically saying, you know, this year, we've had things like you know, the continued you know, invasion of Ukraine.
We've had so much going on in the Middle East. Obviously, we've had in the past couple of weeks with France in Germany, so she was just saying, you know, we'll have more of those and that could end up actually stymying things. So even you know, with this huge agenda of deregulation, the geopolitics, Trump's economic in her mind for the next twelve months.
Yeah, And there was an interesting conversation also with the US Ambassador to the UK, Jane Hartley, and she kind of went through some of the biggest risks. But what was interesting it was always with a bit of optimism certainly on the UK.
That's right, and saying that the UK rather could play quite a significant role when it comes to Europe.
You know, there is some worry about some of the bigger countries in Europe, which is why I do keep going coming back to the UK and we need UK to lead because as we know, we've seen a lot of political instability recently in France, political instability in Germany, so the UK has to play a role.
Obviously they were being a bit careful about this, but referring to some of the political turmoil in France and Germany and look at these very too significant economic engines in Europe and saying, you know, there's question marks there.
I mean, at the same time, some of the optimism on the US was a bit intriguing because even though Donald Trump may be loosening regulation, he very much clearly wants to do that cutting red tape through DOGE, this this job that he's assigned to Elon Musk and I don't necessarily that it's going to be waving everything through. I mean, you see the big US steel deal with Japan and Joe Biden now potentially looking to block that, but Donald Trump is made clear he would block it
either way. I mean, if he thinks a deal is not good for the US or not good for the US company, he will still potentially get in the middle of that.
So there might be a little bit of risk.
Still involved when it comes to the upper arrowdness of the conversation around the US, and you know, as we're saying, we just don't know exactly what he's going to do in the rest of the world. But it was intriguing to see, you know, people saying, well, Europe and the UK not really sure, some uncertainty around the new UK government and policy making. But equally, you know, there was
one outlie I was quite intriguing. It was on Bloomberg Radio actually in the morning, and that was from Oachery Capital Management, so Daniel Polly and she said, you know, yes, the US is looking good, but in all of this, maybe we are going to overlook Europe a bit. It's not all down arrow for Europe. So there were a few voices saying there may be opportunities in Europe and the UK in all of this.
Ros I'm still so surprised about this massive difference about geopolitics and how it's playing out on the market. So, you know, this was December tenth that we did the conference. Usually people say, oh, what are you doing for the holidays? I mean, there's no winding down, right, And it was very clear from the people in the room, that people on the panels and people in the audience. It was
you know that we're so busy because of geopolitics. I'm just trying to say on top of the news, and yet nothing is really translating into markets.
Well, that's right.
You see it on the energy market too, with the events in the Middle East. You're not seeing massive moves necessarily in the oil price. And I think a lot of places we hear about are now they're listening a lot more to the geopolitical situation and they're bringing in people to help explain it to them. What does this mean tangibly all these things that are going on in the Middle East or beyond, but also looking through all of that to the realities of what does that mean
for things like supply and demand. If you look at oil, it's really not affecting supply, for example, and so there's a lot of things happening in the Middle East, in particularly in Syria in recent day, but that doesn't impact the supply of oil. And as long as supply doesn't get impacted and prices don't move as a result, you are seeing a willingness to look suit through some of
that in the market. And again people seem to be hanging their hopes on brighter times ahead for business in the US, and even with the unpredictability of Donald Trump, because it can be a pretty unpredictable at least as a sense of knowing a bit more now about what Donald Trump is like as a leader from the first administration, and you know, business and markets learning how to deal with that.
Jenny, what's your take on the private credit market. So, first of all, it's huge, and it kind of I mean, I wouldn't say it came out of nowhere, but it's so huge. It's like one point six trillion at the moment, and it's been really like a massive change, a massive shift over the last couple of years. Many believe it could even double. But you know, does it change how we price risk?
We don't really know.
Is there a concern with valuations? Does that change some of the conversations that we're having.
That was definitely one of the big takeaways from yesterday was so I think it was it was Googenheims and Walsh that said that she sees this market doubling, the private credit market doubling.
Specifically, I've seen estimates of potentially four trillion dollars in private credit going forward relative to where we are now, So we could see a doubling of the size. And I think one of the elements that would potentially drive that is a way for retail investors to somehow move into private credit, which right now that's really not happening.
It's at the very beginning in some cases, but that will also drive that development and make it more shall we say, the democratization, if you will, of private capital.
And then I think it was Franklin Templeton's Jenny Johnson who talked a lot about how she's looking at private credit assets that are trading at exactly the same spreads as traditional fixed income assets like bonds, and she just couldn't believe that because she just thinks that there should be a premium for the type of iliquidity that you see in these markets. There was an also an interesting
panel though that that I thought was really fascinating. It was about the business of wealth management, and they actually were talking a lot about how they were coming up with all these new solutions to try to actually introduce more liquidity into private markets. So Morgan Stanley Elizabeth Dennis there, she basically was saying that they're hearing so much more from clients that they want to invest in closely held companies.
So take like the Revolutes of the world or the Monzos of the world here, and she was saying that, you know, we see all these clients really wanting to pour into these these big, growing startups, but they're just they're not going public, and they don't want to go public.
And we understand all the reasons why that is. And so what they've actually been doing is helping these clients or helping these companies arrange secondary share sales where you know, they go to early investors or early employees who hold shares of these privately held companies, they buy those shares off of them and then sell it to their their
wealthy their wealthy clients. And so for the company, you know, brings in new new investors, kind of brings in new evaluations, some new enthusiasm for their for their stock, and for those early employees and early investors, you know, they get the liquid that they've probably been long wanting, and so it sort of helps this market limp along, It helps these companies avoid the IPO markets for a little bit longer,
and obviously it keeps your wealthy customers happy. And so it was sort of interesting to see all the ways that these women were kind of coming up with to introduce new liquidity into this growing and fast market.
We also had a pretty special conversation with Jane Fraser of City Group. Is she the most powerful woman in global banking right now?
I think so, you know, she's definitely, she's three years after from over three years after she was named. You know, she's still the only woman atop a major US bank, which is kind of sad, but definitely she sits at the corner of so many different things. You know, she's pulling off this massive transformation of City Group. We had a really nice big takeout on that yesterday where she talked about, you know, this is a five year process.
I'm about halfway through. They've still got a lot more to go.
My ambition is to be a high returning, high quality earnings, simpler institution that continues to play a shaping role in the global financial system. We are truly privileged to be as in as many locations as we are, with a talent base, with such a global mindset and an ambition about it. So I think about we've got the right strategy and vision we're executing with the right organization, and that we're a simpler, well controlled, modern organization.
And she was really focused on you know, one key metric that they look at as return on tendable common equity, which you know sounds like a mouthful, but it's actually a really important metric that City Group has long lagged behind on and you know they're trying to get it up to I think twelve percent. They're sitting at seven
percent right now. If you look at their peers like JP Morgan and Bank of America, those guys are are usually in the mid teens with that, And so even when they get to where she wants them to get to there, they're still pretty far behind their what their rivals are notching. And so I think, you know, she has one of the hardest jobs in banking, that's for sure. So she's I think she's definitely one of the most important people. But she's also got a really tough job
ahead of her. And I don't think she's you know, she doesn't have any rose colored glasses on about that. I think she's pretty clear i'd about the challenges ahead.
It's amazing, actually, how you know, after those conversations, so many people in the corridors would say, I really hope she succeeds because she has seen is you know, a kind of female leader that will pave the way for others.
Absolutely, I mean I think that that's there's like kind of so much riding on it in terms of just both pulling this off, getting this bank into a place where it's actually producing the kind of returns it should be. But then obviously, yeah, she's a really visible player and a really visible woman on the world stage, and she's got a whole you know, thousands of women behind her in the finance field that want to want to see her succeed and rols.
I mean, in some of these conversations, we also put the spotlight on trying to understand the changes in Blockshaine and maybe crypto and AI because of the Trump administration. Still really early days.
It's still really early days, and it's more complicated than it may sound. Because people think Donald Trump, Oh, he just loves crypto. He will utilize that when he thinks it's good for him and his businesses and his family and their businesses also, and in general his low regulation light touch on different corners of the market, and we can expect, you know, him to be fairly light when it comes to crypto.
Yeah, it was interesting. Anna Button was on fire. She was like, let's just take you know, pause a second until we know what the US comes up with it's supervision regulation, and then Europe can follow suit.
Yeah, she was. I thought she was on fire.
I really look like her Van I mean, I always like hearing her dog. But I really liked a lot of what she was saying, and I thought it was interesting some of the things that she was getting really fired up about, like the she had that whole little diatribe against Apple.
We want and we welcome competition, but it has to be fair. And I've said this many times, not a fair level playing field right now on data, on capital, on resilience for payments providers that actually compete with us on banks, and so that is to me the most important aspect.
You know, saying, you know, they are getting a huge chunk of our commissions every time we have a customer that puts their credit card into Apple Bay, and that's
what I want to fight. And so I like how firey she was, and I definitely think she, you know, she was really trying to be a champion for Europe and wanting to see Europe kind of own its moment and go up against the US, And I mean, I thought it was just fascinating, especially given all the other kind of dynamics and definitely all the everybody else being really harsh on Europe. It was fun to see a champion for it. And at some point in the day.
Yeah, I think twenty twenty five will probably bring more champions or more losers, depending on which way you look at it.
Well, that's the question. We are kind of going into a very different world.
I mean, if I didn't have several things, certainly my bingo cow to have to say recently, I mean, Marshal Law briefly in South Korea, and anyone expected that the rapid rapid fall of the Assad regime in Syria that was not on my bingo card either, sore a dramatically shifting landscape and overlaying all of it in a way despite the fact that Donald Trump will loom very large over the world.
Thanks for listening to this week's In the City from Bloomberg. It was hosted by Me from sin Laqua. It was produced by Samersati, production support from Moses andm and sound design by Blake Maples. Special thanks to Ross Matheson, Jenny Seraine, and the organizers of Bloomberg Women Money Power event. Please subscribe, rate, and review wherever you listen to podcasts.