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Ken Griffin has warned Donald Trump’s plan to raise tariffs would put the US “on a slippery slope to crony capitalism” and offered other harsh critiques of the incoming president’s agenda, in surprisingly sharp criticism from a major Republican donor.
The billionaire founder of hedge fund Citadel also signalled on Thursday that he would be “open to the possibility of selling a minority stake” in his firm for the first time.
In an interview at the Economic Club of New York, Griffin said he was “gravely concerned” that Trump’s plan to impose tariffs and curtail immigration would impose huge inflationary pressure on the US economy.
He said: “Now you’re going to find the halls of Washington really filled with the special interest groups and lobbyists as people look for . . . higher tariffs to keep away foreign competition and to protect inefficient American businesses that fail to meet the needs of the American consumer.”
Since it was founded by Griffin in 1990, Citadel has grown into the most profitable investment firm in the industry’s history. He owns the vast majority of the $65bn group, which has never before taken outside investment in its management company.
His comments come only weeks after the Financial Times reported Citadel’s main hedge fund rival, Millennium Management, is in talks with BlackRock, the world’s largest asset manager, about selling a minority stake in its business.
Griffin said the multi-manager sector, the most lucrative corner of the global hedge fund industry, was in “a consolidation phase” and would “probably see growth again further down the road”.
While Griffin made his name through his hedge fund Citadel, a larger chunk of his fortune — estimated by Forbes at $43bn — comes from Citadel Securities, his 22-year-old market maker, which is at the forefront of a new breed of trading firms that have eaten away at the traditional dominance of big banks.
Commenting on the new administration, Griffin said that, under Trump there’s a “real risk of going way too far [on immigration]”.
He noted many of the top Silicon Valley companies were founded by immigrants and European leaders have recently griped to him about the continent’s brightest minds — especially in artificial intelligence — moving to the US. He said it was essential that America kept its borders open to the best and brightest, noting Peng Zhao, Citadel Securities’ chief executive, is a US immigrant.
Griffin, a historically influential donor to Republican candidates who stopped short of endorsing Trump for presidency in this month’s election, threw his support behind the prospect of Marc Rowan, the co-founder of investment firm Apollo Global Management, becoming Treasury secretary in the Trump administration.
“Marc is clearly one of the great thought leaders in alternative asset management,” he said of Rowan, who is in Trump’s short list to run the Treasury. “If Marc is offered the opportunity to be Treasury secretary, please take the job.”
In 2022 Griffin sold a minority stake in Citadel Securities to venture capitalist Sequoia. He said the market maker “is not focused on going public in the foreseeable future, we’re focused on building our business”.
He said “there are benefits to being private in this period of rapid growth . . . in time the capital demands of the business will push us to being public, but we’re not there yet”.
https://www.ft.com/content/b8ac91c6-50b9-4dfc-b6c1-2b41f9d65b5d
