- 7 months ago
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00:00In many ways, it's fulfilling the work that everybody has done.
00:04I mean, taking on the responsibility was something that I was,
00:08it was pretty daunting for me to do that with my full-time day job.
00:13And, but the amazing team behind Davos really assisted with me and helped me out.
00:22I have an amazing co-chair.
00:23And importantly, though, I think everybody was in need of having a conversation.
00:33You know, we, as a board, we talked about that we wanted to move the conversation
00:38and have a much more open, robust conversation.
00:42And that's how we came up with the spirit of dialogue as the foundation of today.
00:47But I think the consequence of so many things going on globally,
00:49I think, you know, we were able to be at the right moment in the right spot.
00:56And importantly, let me start off with the foundational issues.
00:59I mean, the 55 years of Klaus Schwab was a foundation of what we were being able to build upon.
01:04But no place other than the World Economic Forum in Davos
01:11has the combination of world leaders.
01:14And we had 84.
01:15I think the only other place where you have 84 world leaders in one place is at the UN in New York.
01:21But we had over 800 CEOs in share.
01:24We had civil society.
01:26We had so many different people here.
01:29And I think it was that conversation, that spirit that really made it.
01:33I guess it was touch and go because at times people were bracing for a belligerent speech from President Trump.
01:39So I don't know how you look at geopolitics and geoeconomics, given what we've learned so far.
01:43I think because of all that everybody wanted to hear, I think Tuesday was just as important.
01:50The conversations we had with Europeans, with Mark Carney, with Emmanuel Macron,
01:57they were great, honest, open conversations.
02:01I think Mark Carney delivered an incredible conversation.
02:04I may not have agreed with everything he said.
02:06That's not what we're here for.
02:07We're here to have that conversation.
02:09But I really do believe the openness of those conversations on Tuesday led, obviously,
02:14to a large conversation with the President of the United States yesterday.
02:19And then we had the peace initiative this morning.
02:21But my conversation even Wednesday morning with Jensen on the role of NVIDIA and what does that mean for all of AI.
02:29And, you know, to me, I learned a lot of that conversation.
02:32Do you worry about AI bubbles?
02:34I mean, this is the thing that worries the markets if you put your BlackRock hat on for a second.
02:39It's AI and it's geopolitics.
02:41Which one's more uncertain?
02:43I don't think there's any uncertainty about AI.
02:45There's no question.
02:47Hundreds of billions of dollars is needed to build this out.
02:50The CapEx is going to drive more global growth.
02:54How that is going to be dispersed and where it's going to be, it's going to be really dependent on each and every government.
02:59But I sincerely believe there is no bubble in the AI space.
03:05That being said, like in everything else in capitalism, there's going to be some big failures.
03:10OK, we always see a rotation and there's going to be some huge winners and some losers.
03:16But do I believe the needed capital to build out AI is one of the great opportunities for the world to come?
03:26When you think about the hundreds of billions of dollars of infrastructure that's necessary, countries are going to have to rebuild their grids.
03:32We're going to have to source new powers of energy.
03:35Last night at a dinner, we had an amazing conversation on how AI is going to change science and how it's going to improve human lives in terms of medicine.
03:45But importantly, there is a strong foundational belief that AI is going to accelerate new sources of power.
03:51And if we can have cheap sources of power, abundant cheap sources of power, maybe things that we can't even think of today through AI, imagine how that could lift the rest of the world.
04:03You announced a big, actually, partnership with Microsoft that you've raised $12.5 billion as part of this partnership to bankroll data centers.
04:13Like when are you hitting $30 million?
04:15$30 billion, yeah.
04:15$30 billion.
04:16When's that coming?
04:18Well, we announced $12.5 billion.
04:20We're actively raising more money.
04:21We did already make an acquisition in aligned data centers.
04:26The total enterprise value was $40 billion.
04:28But not only is Microsoft our partners, MGX of Abu Dhabi, NVIDIA is one of our partners, XAI is one of our partners.
04:37And so we have an incredible partnership group in building this out.
04:42And we are seeing more and more opportunity working alongside some of the best hyperscalers.
04:48And so we see nothing but opportunity.
04:51But we have to be judicious and we have to be thoughtful about it.
04:55But I'm very encouraged about what AI can do for humanity.
04:59I mean, the way that we've covered World Economic Forum is also trying to figure out whether there was a move away from U.S. assets.
05:05Do you see that at all?
05:06Or is it a conversation that you had with the Trump administration?
05:09So if I go back to early Davos last year, I would say the average world investor had an unbelievable overallocation in dollar-based assets.
05:21And I think over the course of last year, we saw probably a 5% reallocation.
05:26And that's fine.
05:28I mean, when your liability is another currency and you're investing in dollar, I mean, the value of the dollar is an important consideration in your total return.
05:37Could there be more reallocation of the dollar?
05:40I think the U.S., because of where we are at AI and the amount of capital that's being spent, I think we have a, you know, the U.S. economy is really growing fast.
05:50I mean, we estimate it will be over 5%, you know, in the first quarter.
05:55So we are, you know, the key is now don't just focus on GDP, because GDP is heavily oriented to all the capex on AI and technology.
06:04The key is in that economic condition, are we creating enough great jobs?
06:12And so to me, that is what we need to be focused on, not just GDP anymore, because GDP is going to be powerful.
06:19And that's one of the reasons why I am still, you know, I do believe the United States is one of the great places to invest and will remain to be one of the great places to invest.
06:28But having a diversification, you know, that we've seen a little bit here and there, I'm very relaxed about it.
06:34I think there's too much noise about that.
06:36What have you learned here in Davos?
06:37I mean, you've spoken to everyone.
06:39Are people nervous about the relationship between the U.S. and the EU?
06:44Is it a little bit better than it was?
06:45What do we do with China?
06:46What's been the most surprising conversation you've had?
06:49How needed people needed to be here to have a conversation?
06:55I think people came here with a lot of trepidation.
07:00I think they came here with a lot of fears.
07:03And I do believe we're going to be leaving Davos with less geopolitical fears.
07:07I believe we have, you know, if there can be peace in Ukraine, which I'm heavily involved in and BlackRock's heavily involved in working on the prosperity fund.
07:21I mean, think about that.
07:23If we could have that, that's a foundation of a more global economic growth.
07:29When you think about when we entered 2025, where we had a war in Gaza, we had all these different skirmishes.
07:35And, you know, we may be more nervous and focusing on all these issues, but the reality, the world is becoming safer, not less safe in my mind.
07:44And the last thing I want to say related to volatility, which if you look at the 10-year Treasury on January 1st, 2025, April 1st, and October 1st, and then January 1st this year, if you're looking at using those four points of data at the 10-year Treasury, the 10-year Treasury moved three basis points.
08:05Okay, yes, we've had a lot of volatility.
08:09There's been a lot of volatility.
08:10But my point is, the way I want to talk about that, when you look at those wider points, there's been no volatility.
08:18And the key and the message that we need to be telling people who are watching, it's not about the moment.
08:25It's not about the noise.
08:26I mean, it is about long-term investing.
08:28You know, when I think back, if you invested a dollar in the S&P on January 1st, 2000, and a year later, you had a 30% downdraft because of the dot-com blast, but over that 25 years, you made over an 8% compounded return, better than almost any other investment again.
08:45I think there's just not enough narrative, not enough conversation about, we've got to just walk away from the noise.
08:52And if you believe that we can be better, if you believe that your government, your economy is going to grow, you need to grow with it.
09:03I said something in one of my meetings earlier today, I don't remember which one now, and this one very powerful person in AI came up to me yesterday, and he said, you're right.
09:15And what I said was, we need to make sure if this AI transformation is real, I think we need to make a responsibility getting more people to be investing alongside of it, not watching.
09:30And I always say, if you believe in your country, if you believe in your country, why aren't you investing with your country?
09:36And the best way of investing is in a broad index in your country.
09:39And I think one of the foundational problems of Europe has been the underinvestment, the lack of capital markets in Europe.
09:50When you think about the success in the last 24 months in Japan, it started when the then-Prime Minister Kishida doubled the size of the NISA account, which is the self-directed retirement account.
10:04Larry, does that change after the threats and warnings from President Trump for Europe?
10:09Is this the time where they focus on capital markets?
10:12But I heard Christine Lagarde talk about, you know, Europe needs a capital markets, a unified capital markets.
10:19I think that's an important message for Europe.
10:23You know, I think President Trump's prompting Europe to take more responsibility in defense and NATO.
10:29All these things are really wonderful.
10:31I think I actually am bullish on Europe because I'm starting to see Europe doing these long-term things to build vitality for the future.
10:40Larry, are you moving left to Detroit?
10:42There has been no, there has never been a formal conversation or a conversation at the board level or at the governance committee about any movement of Davos.
10:56There has been a broad conversation.
10:59How can we bring the vitality of the World Economic Forum in Davos to other locations?
11:06I will be in Istanbul with the World Economic Forum this spring in Istanbul.
11:11There is a spring World Economic Forum now in Jeddah in April.
11:18And so we need to have this foundation of conversation, not just here in Switzerland, but we need to have it in other locations.
11:24And to me, that is going to be the essence of, you know, of having these things, having more deliberate conversations.
11:31And it doesn't have to always be in Switzerland.
11:34But Davos is Davos.
11:36It is a great town.
11:38The weather is magnificent.
11:39The hospitality of the Swiss government has been amazing.
11:43I think having this Congress Center has really allowed us to have, you know, intimate conversations, brilliant conversations, and importantly, open conversations.
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