Exclusive interview: Treasury Secretary Scott Bessent on Trump accounts, Trump's crypto gains, more

[0:00] So, first of all, thank you so much for sitting down with us. [0:02] No, glad to do it. [0:03] It's an exciting weekend. [0:04] Very exciting. [0:05] And you made an announcement today about the Trump accounts that people will be able to contribute public stock to the Trump accounts through the Treasury. [0:14] So, why was this so important? [0:16] Well, there are two components to the Trump accounts. [0:20] There are any child born during President Trump's term is going to receive a $1,000 seat investment from Treasury. [0:28] But we also have great philanthropists, foundations, and corporations who want to donate directly. [0:37] And that could be for any of the children from age 0.1 up to 18. [0:44] So, with this, they could actually donate a shareholder, a large shareholder in a company can donate his or her stock directly into the accounts. [0:55] And it will be distributed to all the account holders. [1:00] So, more money. [1:00] More money available. [1:01] Well, more money. [1:02] But the point is, and we may have talked about it when I saw you at the launch, was it's not just the $1,000. [1:10] Right. [1:11] It is for the older children, too. [1:13] And many people are doing it. [1:15] You know, for instance, Susan and Michael Dell are doing an age component and then for zip codes that are not in the top 20% of income zip codes. [1:26] So, I've heard you describe the Trump accounts as a way to build wealth for children who otherwise wouldn't have access to investing. [1:35] So, what's the benchmark for success here? [1:37] Well, a couple of things. [1:39] We've already got the over 6 million accounts open. [1:43] And there are about 70 million eligible children. [1:48] So, we're off to a running start and getting that up. [1:54] And there are going to be two components here. [1:56] 38% of American households have no investment in our great equity markets. [2:02] And we want everyone to share in the bounty that is the U.S., in our innovation, in our capital markets, in this economic engine greatest in the history of the world. [2:16] So, over time, I would think that that 38% number would move towards zero. [2:22] And then the other thing, too, is financial literacy. [2:24] So, right now, at Treasury, we've got 15 learning modules that you can go to trumpaccounts.gov and see them. [2:32] Because the important thing to remember, too, is many of these families will have had no exposure to the equity markets. [2:39] So, some of the modules are for the children and they're age-related. [2:44] And then many of them are for the parents. [2:45] And I think this is going to be a real-time financial literacy learning experience because you'll be able to see the account on your cell phone. [2:54] And I think this is going to be one of the great real-time learning experiences in the history of the U.S. [2:59] And so, picking up on that, you know, specifically, what are some of the things that you are trying to share to educate folks about the opportunity but also the risks? [3:08] Because this, as you say, could be the first time that these parents and, therefore, these children are exposed to the idea of investing. [3:15] Well, we want them to really understand the power of long-term compounding, that you own a share of a company. [3:22] Many people have bank deposits. [3:26] They're used to getting interest. [3:28] They're used to paying interest. [3:30] So, what we want them to understand is what does a piece of the action feel like? [3:36] It's a good way to phrase it. [3:38] You know, sort of what you were getting at when you were talking about having investments, having asset ownership, that's part of the wealth gap, right? [3:47] And, you know, traditionally, though, it's not just about what assets you own in terms of the stock market. [3:52] It's also home ownership and inheritance. [3:56] And so, you know, some critics might say, well, $1,000, what is that going to do without broader systemic changes? [4:04] Well, that's wrong. [4:07] Because, again, you know, I think in some states, because many states are also going to contribute, that, you know, $1,000 would turn into $5,000. [4:18] And when the child turns 18, they could then roll it into an IRA that could be between $300,000 and $500,000 at retirement. [4:28] So, you know, but that's just with the initial seed contribution. [4:33] And I would expect that we are going to see, you know, again, from these philanthropic families and institutions and companies, [4:41] I would expect that we would see the lower income profile families, actually, the accounts will be topped up more. [4:50] So I want to pick up on that piece about lower income, because we're talking about a program that is designed to take advantage of long-term market gains. [4:59] But many families are seeking more immediate relief, especially when it comes to prices. [5:04] Last time that you and I spoke in January and had the privilege to talk to you about this, [5:08] I remember you said to me that the results regarding prices, and I'm quoting, are starting to kick in right now. [5:16] Since then, we have had a war with Iran. [5:18] Inflation is on the rise. [5:19] As Fourth of July weekend, people are driving to their holiday celebrations, their cookouts, [5:24] and they're seeing gas prices that are higher than a year ago. [5:27] They are going down, though. [5:28] So what do you say to those families that are looking for that more immediate relief? [5:33] Well, that isn't the purpose of the Trump accounts. [5:36] What I say to those families is what I've been saying since the Iran conflict started. [5:41] We're going to get to the other side of this. [5:43] Inflation is going to come back down. [5:45] It's largely dominated, as you said, by gasoline. [5:49] In many states, we're back to around $3.50. [5:52] I think we can get back to $3, hopefully. [5:55] When? [5:56] Maybe by Labor Day. [5:58] And oil prices are actually lower than they were on February 27th, when the conflict started on February 28th. [6:08] So gasoline prices are a little stickier on the way down. [6:11] We're trying to give the gasoline retailers a little bit of a nudge. [6:15] We're telling them we're watching them. [6:16] And we've had some good uptake from some of the bigger retailers in terms of what they want to do for consumers. [6:27] And look, we understand. [6:30] The previous administration was the worst inflation in 47, 49 years. [6:36] And we were at a very high level. [6:39] But we had had, before April, we had seen real wage growth for working Americans every month during President Trump's presidency. [6:51] And I would expect maybe even as soon as next month, we will go back to that. [6:56] Well, so that brings up the jobs report that we got today. [6:58] And so it was stable growth. [7:00] And you look at, you know, sort of a three-month horizon. [7:02] But I want to pick up on that wage growth point, because annual wage growth, 3.5%, inflation's running above 4%. [7:08] And as you said, when we talked in January, that was one of the wins that you were celebrating, that there has been that real wage growth. [7:14] There isn't now. [7:15] So when is that going to come back? [7:16] But again, this is a short-term spike. [7:18] We're going to probably see it come down as soon as this month. [7:22] You know, we've seen oil prices down. [7:24] We've seen energy prices down. [7:26] And what we haven't seen is the inflation move into core inflation as opposed to the noisier headline inflation. [7:36] So I would expect that perhaps as soon as this month, we're going to see real wage gains. [7:41] And is that, though, dependent on achieving a deal? [7:44] Because, Secretary, I watch the oil markets. [7:47] That's like, I watch them every morning. [7:48] And at the hint of a deal, it comes down. [7:51] At the hint of a conflict rising, it goes up. [7:53] That's not right anymore because even before we had the deal, we were getting up 5, 10 million barrels a day out of the Gulf. [8:00] So, again, oil prices keep going down. [8:03] The Iranians try to say some crazy things. [8:06] We're going to do this in the strait. [8:07] We're going to do that in the strait. [8:09] I think they're getting very frustrated. [8:12] And, you know, we saw oil prices down, again, substantially today. [8:16] Labor Day comes around. [8:17] I'm going to call you up. [8:18] I'm going to say, Secretary, let's rehash this. [8:20] Okay, great. [8:21] Something else that I wanted to ask you about, the president's financial disclosure showed that crypto had become a major source of his income. [8:29] While the administration is shaping crypto policy, even if the White House says there's no conflict of interest, which is what we've heard, is there an appearance problem when so many folks are struggling? [8:40] Well, again, I don't think there's an appearance problem. [8:42] The president, this is an innovation presidency. [8:46] So whether it's digital assets, whether it's AI, whether it's everything that is going on in the tech ecosystem, that all Americans are benefiting from that. [8:58] I have one more question for you. [8:59] When you look at the economy through market returns, it's quite strong. [9:03] But when many families look at it through groceries, gas, rent, borrowing costs, they feel strained. [9:09] Which view do you think is more the real view of the economy? [9:14] Well, the stock market lives in the future. [9:17] So what the stock market is telling us is presumably what I am saying today, that we'll get to the other side of this. [9:26] Rates will come down and then we will be back up to real wage gains. [9:32] So both can be true. [9:34] And if someone can't wait until the future? [9:36] Well, again, that we're seeing prices come down and we have seen, you know, we saw an elevated level of prices and we are doing everything we can to get them down. [9:52] Very final question. [9:54] Last time we talked, you and I went viral because you revealed that your dark secret is that you drink Dr. Pepper. [10:00] Yep. [10:01] Has Secretary Kennedy talked to you about that since? [10:03] He hasn't, but my children have, so I am now, you might know, I'm a little thinner, so it's Diet Dr. Pepper in the morning. [10:11] Diet Dr. Pepper. [10:12] Diet Dr. Pepper. [10:13] All right. [10:14] I'm going to give you a pound for that. [10:15] And that was not a paid ad. [10:17] That's not a paid ad. [10:19] Secretary, really appreciate your time. [10:20] Thank you for sharing about the Trump accounts and the broader economy. [10:23] Good to see him. [10:24] Good to see him. [10:24] Thanks.