29th Annual Milken Institute Global Conference Special: Day Two

Summary

Balance of Power – 29th Annual Milken Institute Global Conference Special: Day Two

Date: May 5, 2026
Hosts: Joe Mathieu & Carol Massar, Bloomberg
Special Guests: Steven Mnuchin, Amos Hochstein, Denise Leonard, Maria Korsnick, Suzanne Clark, Bridget Mendler

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Episode Overview

Broadcasting from the Milken Institute Global Conference in Beverly Hills, Joe Mathieu and Carol Massar brought together leading voices from finance, energy, business, fintech, nuclear power, and space to explore the “balance of power” across economic, geopolitical, and technological lines. The discussions traversed new SEC reporting proposals, the AI-fueled economic cycle, U.S. and global market psychology, strategic energy concerns in a conflicted world, the acceleration of digital payments, nuclear renaissance, business climate priorities, and the commercialization of space.

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Key Sections & Highlights

1. U.S. Market Regulation & AI-Driven Economic Growth

Guest: Steven Mnuchin (Former Treasury Secretary)
Timestamps: 01:00–15:18

SEC Proposal: Semiannual Reporting

• Summary: The SEC’s new proposal to allow companies a choice between quarterly and semiannual reporting.
• Mnuchin’s Take:
  • Supports the proposal; quarterly focus is too short-term for some companies.
  • “Giving companies the option is a very good idea.” (01:25)
  • Growth and turnaround companies likely to retain quarterly reports; slower-evolving firms may opt for less frequent reporting.

Market Drivers and AI

• Large-scale investment in AI, data centers, and cloud is perceived as still in early innings.
• Mnuchin underscores U.S. market dominance because of its liquidity and global investor confidence.
• “If you can take a 10 year horizon, there’s no better place than buying S&P 500.” (03:19)
• Risks: job dislocations due to AI; potential concern about overbuilding data centers, but he feels overspending would be corrected rapidly and a looming shortage is power for data centers, not demand.

Geopolitical Outlook: Iran and Market Risks

• Mnuchin backs “President Trump’s stand to prevent Iran from getting a nuclear weapon,” calling it “the biggest risk in our lifetime.” (06:28)
• Market is largely discounting Mid East risks, expecting good outcomes even amid volatility.
• Reopening the Strait of Hormuz would not resolve energy flows overnight, but U.S. economic strength should absorb shocks.

U.S. Fiscal Policy & Rate Outlook

• Deficit concerns: chronic high spending has normalized trillion-dollar annual deficits, requiring bipartisan long-term action.
• “There’s no question that during COVID, we had to spend massive amounts of money… but [that] kind of normalized trillion-dollar spending.” (10:12)
• He believes President Trump is best positioned to tackle spending should he win another term.
• Sees equilibrium interest rate near 2.5–3%, with Fed portfolio shrinkage as an additional lever.
• No imminent “make or break” debt crisis, but rising risk premiums likely: “You see the 30 year bond approach 5%… volatility around inflation and the war, but also long-term financing costs.” (12:03)

Lionsgate and Entertainment

• On recent investments and the film “Michael”: “Shows you that when you have the right content, people still want to go to the movies.” (14:44)
• On public service: “It was an experience of a lifetime. I couldn’t be happier that I did it… I’m enjoying being on the outside and rooting for them.” (15:09)

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2. Energy Security, Oil Crisis & Strategic Shifts

Guest: Amos Hochstein (Former Senior Adviser, White House; Energy Diplomat)
Timestamps: 16:59–26:30

Oil Market Realities

• Illusion of “lower oil prices” belies gas at $110/bbl and real spot shortages; market “wants to rally, doesn’t like bad news.”
• Quote: “$110 of Brent oil is only available on a Bloomberg terminal… that barrel of Brent oil is selling for 150, 145 some days, 155, even 170… in the real market.” (18:09)
• Tankers not moving; shortages hitting poor countries first, but progressing toward developed economies.

Structural Changes: New Energy Map

• Echoes 1970s oil shock & recent supply chain disruptions; predicts global build-out of infrastructure to bypass the Strait of Hormuz and increase destination storage.
• “The Strait of Hormuz is under Iranian control for the foreseeable future… Must build out infrastructure that bypasses the strait and add more storage in places like Singapore, Tokyo, Delhi, and China.” (20:12)
• Warns: U.S. travelers should prepare for “very expensive” summer travel, especially by car and RVs.

Iran Conflict & U.S. Policy

• Critiques current and past U.S. approaches: “If we’re going to war against every country that hates America… North Korea is doing a lot on nuclear… but we’re not going to war there.”
• JCPOA (Iran deal) would have been a better alternative; “The deal we’re talking about now… very similar. We didn’t have to do this war.” (22:28)
• Iran is suffering economically, but can “handle the pain longer than anticipated.”
• Predicts deepening oil product shortages spreading from poor countries to the U.S. (25:51).

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3. Digital Payments & Economic Signals

Guest: Denise Leonard (Chief of Zelle)
Timestamps: 28:03–31:46

Zelle’s Scale & Growth

• Network: 2,400 financial institutions, 160 million accounts, $1.2 trillion moved in past year, 20% year-over-year growth.
• “That’s larger than the GDP of Switzerland… continuing to grow at 20% year over year.” (28:35)
• Small businesses: fastest growing segment, now 30% of volume—instant payments enable agility.

The Future of Payments

• Focused on new use cases: bill pay pilots, recurring payments, donor-advised funds, and supporting small businesses.
• On cashless society: “The goal for us is that more and more digital payments, it’s more safe, more secure, and also more convenient.” (31:15)
• Zelle remains a consortium of major banks; no plans to go independent.

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4. Nuclear Energy’s New Moment

Guest: Maria Korsnick (CEO, Nuclear Energy Institute)
Timestamps: 33:21–38:55

U.S. Nuclear Expansion

• Current nuclear generates 20% of U.S. electricity; public support above 60% and climbing, in part due to data center power needs.
• Strong growth in power upgrades and new builds: “Extending life of plants… three-quarters to do power upgrades… 5-6 gigawatts of new power short term.” (35:01)
• Modular reactors (SMRs): construction underway in Wyoming and Canada. Next generation may be operational in early 2030s.
• “What you have is going to last longer. What you have can make more power.” (35:13)
• Needs from Washington: legislative support for first-of-kind risks (“ARC Act”), optimizing tax credits, and more rapid permitting.

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5. Business Climate, Domestic Policy, and Innovation

Guest: Suzanne Clark (President & CEO, U.S. Chamber of Commerce)
Timestamps: 39:12–46:38

Top Concerns for U.S. Businesses

• Affordability crisis is fundamentally a supply issue: “We don’t have enough housing, access to healthcare, labor in key sectors, or resilient supply chains.” (41:01)
• Biggest lever: Permitting reform for projects (“takes five to seven years to get a permit… you’ll have a change of administrations most likely”). (41:43)
• Government needs to “set the conditions so business can solve these problems at scale.”
• Crypto: Chamber supports thoughtful, balanced innovation; not opposed to new tech, but values U.S. capital markets tradition.
• AI & workforce: “First technology in the U.S. that small business embraced first… a great equalizer. Last year the U.S. had 5.6 million new business starts.” (45:39)

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6. Mainstreaming Space: Infrastructure & Opportunity

Guest: Bridget Mendler (CEO & Co-Founder, Northwood Space)
Timestamps: 46:58–51:54

Space as a Service

• Northwood Space provides “networking infrastructure between earth and space”—enabling any space company to connect via a shared backbone.
• “If we can do that at scale, provide it as a generalized solution for the industry, that opens up a lot of different businesses to grow.” (48:31)

Industry Trends

• Draws parallel to AWS for space: letting companies focus on their missions, not the connectivity burden.
• Broad customer base: government, GPS, sensing/terrestrial apps, and new space communication ventures.
• Expansion: sites now in Australia/US, aiming for eight countries and 100 antenna units this year.
• “This year it’s about scale… producing nearly a hundred antenna units.” (51:22)

Cultural Note:
Bridget Mendler, recognized for her Disney Channel career, highlights passion and curiosity driving the space field: “Space industry is full of people who are passionate, curious—I feel grateful the world is opening up to this mainstream aspect.” (49:45)

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Notable Quotes

• Steven Mnuchin:
  • “Giving companies the option is a very good idea.” (01:25)
  • “AI is going to impact almost every business we touch... in a very positive way. But there are going to be job issues.” (03:19)
• Amos Hochstein:
  • “The real market right now is that there is not enough oil. We’re in demand destruction… but the stock market doesn’t care.” (18:40)
  • “The Strait of Hormuz is under Iranian control for the foreseeable future… must build out infrastructure that bypasses the strait.” (20:12)
• Denise Leonard:
  • “We had $1.2 trillion moved on the platform last year; that’s larger than the GDP of Switzerland.” (28:35)
• Maria Korsnick:
  • “We’re 20% of the electricity sector today… not hearing the pushback for local communities anymore.” (35:13)
• Suzanne Clark:
  • “We really believe a lot of the root of the affordability problem is a supply constraint.” (41:01)
  • “Do you want to hear something cool? The people having the fastest uptake of AI? Small business.” (45:39)
• Bridget Mendler:
  • “If we can do that at scale, provide it as a generalized solution for the industry, that opens up a lot of different businesses to grow.” (48:31)

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Timestamps for Key Segments

| Segment | Start Time | |------------------------------------------------|------------| | Steven Mnuchin – Markets, Geopolitics | 01:00 | | Amos Hochstein – Oil Crisis & Energy Shifts | 16:59 | | Denise Leonard – Zelle & Digital Payments | 28:03 | | Maria Korsnick – Nuclear Energy | 33:21 | | Suzanne Clark – U.S. Business Climate | 39:12 | | Bridget Mendler – Commercial Space | 46:58 |

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Tone & Language

The dialogue remained accessible but incisive, mixing policy wonkery, high-level industry perspective, and real-world implications, with conversational humor and optimism, especially toward technological progress and entrepreneurial resilience.

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In Summary:
This Milken Conference special provided a 360-degree view of disruptive forces shaping the balance of power in business, geopolitics, markets, and technology. Insights ranged from regulatory reforms and energy security crises to fintech innovation and the evolution of the space economy. Each segment offered a distinctive voice on how global leadership, American resilience, and forward-thinking investments can navigate a world in flux.

Transcript

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[Carol Massar]

Carol Master Jo Matthew live here at the Milken Institute Global Conferen in Beverly

[Joe Matthew]

Hills with a very special guest that we want to welcome here to our set at Milken, it's the former Treasury Secretary Steven Mnuchin. Thanks for being with us, sir.

[Steven Mnuchin]

Great to be here.

[Joe Matthew]

We've got a lot we'd love to talk to you about, but we've got breaking news that just went right on the terminal right before we began the broadcast and that is a proposal by the SEC to go to semiannual reporting or at least allow it. And you can look at two different sides of this coin. Do you think this is good for the markets? Is it good for investors?

[Steven Mnuchin]

Well, I support the proposal. I think there's too many companies that are too focused on quarterly earnings and whether they miss or beat expectations, analysts expectations. So I think the idea of giving companies the option of whether they want to do quarterly or semiannual is a good thing. I mean, I can imagine there are a number of companies, particularly companies that are growing, that are still going to be interested in showing quarterly earnings and showing their progress through the year. But I think giving companies the option is a very good idea.

[Carol Massar]

Does it do anything to kind of the global perspective from investors about how US Market is kind of the gold standard, so transparent because of those quarterly reports and so much more and some of the rules and regulations that really govern our country, our companies here?

[Steven Mnuchin]

Well, there's no question the US Is the gold standard for companies to be listed. It's the most liquid market in the world. It's the largest and the largest economy. And I think giving companies the options I think will continue to have transparency.

[Carol Massar]

Do you think most of them will still stick to quarterly Reporting, My guess

[Steven Mnuchin]

is some will switch and some won't. I mean, as I said, if you're a growth company, you have every reason to want to show the growth every quarter. If you're a company that's in turnaround and things are improving, you're going to want to show it. On the other hand, there are plenty of companies where, you know, they're focused on a long term transition and I think giving them an option is a

[Joe Matthew]

good thing pretty quickly. See two classes of companies when it comes to reporting season, our world a

[Carol Massar]

little bit, but that's okay.

[Joe Matthew]

After hours sessions are going to feel really different. Carol, I But so I'd love to hear from you on this market as a whole and the psychology that's confounding a lot of us. As we mentioned already, it's rally time. Mr. Secretary, oil prices are lower again today after the Defense Secretary suggested that this effort in the strait would not go on forever. That's all you need. And we're back to buying on Wall Street. Is this getting a little toppy or can you rationalize what you're seeing?

[Steven Mnuchin]

I think there's two things that are going on in the market. One is that you have very large CapEx spending and very large growth around AI, around data centers, around the cloud. And that to me, we are still in the early innings of this transition. There's no question that AI is going to impact almost every business that we touch. And that's something that's going to be a very positive way. But there's also going to be job issues and job implications on that. The second thing we have going on is the US is the destination of where people want to invest. You know, Europe's economy is, is underperforming. People are concerned about what's going on in Europe. So the flow of funds into the US dollar, in particular into US equities is still very strong. As I like to say, if you can take a 10 year horizon, there's no better place than buying S&P 500. You know, if you're day trading, that's a little bit of a different issue. Trying to predict the short term markets,

[Carol Massar]

how do we figure out whether or not the spend in terms of data centers is just too much, that there isn't some overspend. Ultimately, you know, we were talking panel, a real estate panel with folks who are all investing in data centers, talking maybe like do we need to have an exit strategy? You know, we talk about data centers in space, like this thing could evolve, chips get more efficient so is, is it something that could be down the road but not to worry about now, or do we need to think about the overspend?

[Steven Mnuchin]

Well, I'd say in the short term the demand for compute is very strong and you're seeing this across a number of companies. I'd say there's two different things. You have Open Air and Anthropic on the one hand who are going to consume a lot of cash as they build out these businesses. And then you have Microsoft, Amazon, Google, Matta that all are cash machines and are building out both AI and are building out the cloud. I think the good news is if there's overspending in the next few years, they'll cut back. So I don't think you're going to see the same trajectory. I think the other issue is going to be we're going to run out of power for data centers. So I think it's people want to spend the money now, get the data centers operating and if they have to scale back over time, I mean some of these data centers, particularly the training centers that have 15 year leases, my guess is 15 years from now, they're dark. Yeah, the cloud data centers will have tremendous growth and will be around for the next 50 years.

[Carol Massar]

Do you have exposure to the area

[Steven Mnuchin]

we spent a lot of time on the area where we're long term investors in what we believe are stabilized data centers.

[Joe Matthew]

Do you worry that just to add on to that, and I think this might be where you're going a little bit, Carol, that efficiencies, whatever is going to be developing in the next couple of years will render these massive data centers useless. They could be the size of a phone booth at some point or just a completely different to Carol's point in space. Is this something that, that has a shorter timeline, knowing that technology will evolve?

[Steven Mnuchin]

You know, if you, if you look back at data centers from 20 years ago in Virginia, we're still using them.

[Joe Matthew]

Well, that's true.

[Steven Mnuchin]

So again I separate training data centers. You're going to need to train these models, then you're going to. It's very different kind of the cloud native issues. But just going back to the market, you know, the market is discounting kind of the geopolitical risk in my opinion. So you know, we don't really see them. The market is expecting we're going to have a good outcome. I completely support President Trump and what he's doing in Iran. I always said Iran getting a nuclear weapon is the biggest risk in our lifetime. And there's no Question. From my experience in the government, they intended to do that. You know, how we play out from here is a little bit more complicated. And as you said, we've seen a lot of volatility in the oil markets and the stock market is, is, is really not discounting this going on.

[Joe Matthew]

Sounds like we're missing something here.

[Steven Mnuchin]

I wouldn't say we're missing. What I'd say is, hopefully we will have a good outcome. Iran will come to the negotiating table. I think the economic and the blockade, the sanctions work.

[Joe Matthew]

Even if the strait reopened tomorrow, though, we've heard that it could be months before energy flows are back to where they were. Does the market have a reality check coming on that?

[Steven Mnuchin]

I think it will take a while. Having said that, there are such positive things going on in the economy that I think to the extent this trade can open up relatively soon, the economy will absorb those energy costs.

[Carol Massar]

I want to ask you, you obviously were in the first administration. You have a better, really probably great understanding of President Trump. And as we say, the markets can go from day to day. Based on the headlines, it looks like it's a 180. How should we be reading what the president is doing? What do we need to understand? Because. Do you feel like this is a different Donald Trump's the second term versus the first term?

[Steven Mnuchin]

No, I don't. I think there's, There's a lot of similarities in it. I think on this issue, and this is an issue he's been focused on since the first term, he's determined and his legacy will be that he's going to prevent Iran from getting a nuclear weapon. And there's been other administrations that were, you know, understood the risk but were concerned. I also give Israel a lot of credit because one of the concerns was all the ballistic missiles and obviously the defense, the air defense systems in the region have been very powerful. But no, I think this is a president that would prefer not to go to war with them again, but will if he needs to.

[Carol Massar]

But this could go. Could we be still talking about war at the end of the year?

[Steven Mnuchin]

I think we could. I mean, I think he's determined that he prevents this from happening, the nuclear situation. And I think that part of the issue is. And he said this, you know, he took out a lot of the leadership. So part of this is making sure that leadership develops in Iran that can negotiate a deal that they'll stick with.

[Carol Massar]

What's the other? Geopolitical. Because you say geopolitical. Is it just the Middle East? Are you thinking about China Are you thinking about other parts of the world?

[Steven Mnuchin]

No, I think it's, it's. I mean, there is this war in Ukraine. I don't want to forget what's going on. Yeah, that's still an important issue. I feel like we don't see it on the press every day. But obviously the big issue right now in terms of risks for the economy and risk for the world is the Middle East.

[Joe Matthew]

You know, there's another cloud you could argue is hanging over this market that has nothing to do with the war in Iran. Although maybe there's a connection at some point when we start talking about the cost of this operation. But that's the debt now topping 100% of GDP. Mr. Secretary, how long can we sustain this? Hank Paulson mentioned to David Westin the need for a break glass solution. What should the treasury be preparing at this time for this?

[Steven Mnuchin]

Well, I unfortunately think there's not a break the glass solution. You know, I think there's no question that during COVID we had to spend massive amounts of money. We shut down the economy. I mean, anybody who ran a business never ran it thinking you'd have zero revenues. You know, I'm particularly proud of, we saved the airline industry. So we have a very robust airline industry. Having said that. Well, but we saved the industry overall. And I think it was, I think it was the right thing to let Spirit go through what they are. Having said that, it kind of normalized trillion dollar spending. And I think this is an issue that needs bipartisan support. You know, part of it is the, the mandatory spending. We have to deal with that part of the budget. And you know, you also do, though,

[Carol Massar]

if you look at what's being allocated for defense in this budget, it's a lot.

[Steven Mnuchin]

Look, there's no question, particularly in this day and age, we need to spend more money in defense. I think right now it's going to be hard to spend another $500 billion in defense without significantly cutting other things out of the budget. So I am concerned about deficits. I think this has to be dealt with. And I think the good thing is President Trump understands these issues. And if there's someone who can tackle the spending issues, I think he's the one to do it.

[Carol Massar]

Does this mean, I mean, what's the make or break moment? Because I'll go back 10, 15 years, we were talking about concerns about the deficit or more, and then it kind of faded away. So what is the make or break moment? And I think about this in the context of Kevin Wash coming in as the next Fed chair, you know, in terms of servicing the debt and so on and so forth. Pressure that might be on him, kind of roll it all together. Do you think he, that he should be cutting rates in this environment?

[Steven Mnuchin]

Well, I think we're close to the equilibrium rate. So before the situation in the Mideast we did have inflation coming down close to the Fed's 2% target. And I think you could say the equilibrium rate is probably between 2 and a half and 3%. So we're, we're close to that level also. There's no question that the deficit so push up our cost of funding so that there's a risk premium built in. And one of the things that Kevin is talking about, which I also support, is shrinking the Fed's portfolio. Well, if you shrink the Fed's portfolio, that's also another tool that you don't have to lower rates. Ultimately the Fed does short term, set short term rates. If they're not doing quantitative easing, which they're not going to do now, they're not setting long term rates. I mean, and I don't think we're going to have a make or break moment where one day we wake up and we can't finance the debt. I do think you'll see an increase in risk premiums. I mean you see the 30 year bond kind of approach, you know, kind of 5%. Part of that is the volatility around inflation and what's going to happen with the war. But part of that is also just pushing up the cost of, of long term financing for us.

[Joe Matthew]

What's Kevin Washington for when he wakes up in the morning and looks at Truth Social? Is this contentious relationship with the chair, if he's not cutting going to continue?

[Steven Mnuchin]

I think Kevin will do terrific in his new job.

[Carol Massar]

Okay, yes or no?

[Steven Mnuchin]

I think he, he will be an independent. That doesn't mean that he will or won't agree with the President. Now look, part of it is where interest rates are depend on the economy. If we continue to have a very strong economy, we're not going to need to cut rates. If for whatever reason we go into a recession, we will have 1% rates. So I mean we had zero rates in Covid, you know, there was a reason why they went down to zero.

[Carol Massar]

Hey, we can't leave without talking about Lionsgate. Think you guys have about a 13% position. What's your plan with Lionsgate? What do you want to do?

[Steven Mnuchin]

It's a great business. Have recently gone on the board. Yeah, Lionsgate is one of the few independent studios left. It has an incredible film library and Michael's been a great success. So do you want to own all Michael Jackson? I can't comment on that.

[Joe Matthew]

Well, so let's wrap with one. One fun question about the movies. Michael is an incredible debut. Looks like it's across the board when it comes to demographics and we're in a world where consumers, consumer sentiment is pointing lower. Their worries about consumer spending, the price of gas, but they're lining up for that movie. What does that tell us about that?

[Steven Mnuchin]

It shows you that when you have the right content, yeah, people still want to go to the movies. It's not just about sitting at home and watching it on tv. And you know, Michael Jackson was just an incredible performer and his music was obviously pretty extraordinary on my playlist.

[Joe Matthew]

Got some.

[Steven Mnuchin]

You know, we all remember growing up with MTV and Thriller.

[Joe Matthew]

It's not just old folks going though.

[Steven Mnuchin]

You see exactly who's the whole.

[Joe Matthew]

Not, not you.

[Carol Massar]

20 seconds. Do you miss the administration being inside?

[Steven Mnuchin]

It was an experience of a lifetime. I couldn't be happier that I did it. I'm proud of what we did. I'm enjoying being on the outside and rooting for them.

[Carol Massar]

Well, we certainly enjoyed having here. Thank you so much. Really appreciate it.

[Joe Matthew]

Stay with us on balance of Power. We'll have much more coming up after this.

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[Joe Matthew]

Almost. Hochstein is with us here at Milken. We should remind everybody we're in Beverly Hills today, which is a bit different at the Milken Global Conference. And of course, former Middle east senior adviser to President Biden and a lifelong diplomat with a real sense of nuance when it comes to the energy markets. Almost. It's great to see you. Welcome back to Bloomberg.

[Almost Hochstein]

Thank you. It's always good to be here.

[Joe Matthew]

Many questions about how we rationalize what we're seeing right now. The fact that oil is lower by simply. Even though Iran is shooting at ships. But one statement from the government that the cease fire remains in place and we're selling oil today. Is that the move?

[Almost Hochstein]

Well, two things. One, remember that we're saying that oil is lower.

[Joe Matthew]

Yes.

[Almost Hochstein]

Oil's at 110.

[Joe Matthew]

Well, that's right. We're still in digits.

[Almost Hochstein]

So one, where it was at the

[Carol Massar]

start of the year, it's 60.

[Almost Hochstein]

60. So we're basically almost double where we were. And we're talking about. Nobody thinks of 110 ever as a low oil price.

[Joe Matthew]

Well, that's fair.

[Almost Hochstein]

That is a very high.

[Joe Matthew]

Directionally speaking, though.

[Almost Hochstein]

But. But here's what's happening. The market really wants to rally. They don't like bad news.

[Carol Massar]

The stock market.

[Almost Hochstein]

The stock market, totally. The stock market. The physical market and the stock market are divergent at the moment. We may get convergence at some point. We probably will be. We don't know if the convergence will be when the stock market realizes where the real physical market actually is or that the war actually ends. We have an opening and then the physical market will go to where the stock market is. But they are not in the same place. $110 of Brent oil is only available on a Bloomberg terminal. I know where you can't buy that barrel. That barrel of Brent oil is selling for 150, 145 some days, 155, even 170.

[Carol Massar]

Right.

[Almost Hochstein]

Because it's only paper. It's people on Wall Street. The real market, the real market right now is that there is no, not enough oil. We're in a demand destruction in certain countries, but they're poor countries first. So stock market doesn't care. So we are in a place where every Day that goes by now with fake headlines and what happened today at the Pentagon is fake headlines. We're not really in a cease fire because missiles are flying. That's usually the definition of a ceasefire is missiles don't fly two days in a row.

[Joe Matthew]

Yeah.

[Almost Hochstein]

We don't have a cease fire in Lebanon because we still have fighting in Lebanon despite the fact that we see say it's a ceasefire and tankers are not moving despite the fact that we have government officials say they are moving. They're not. So that means that there is no tankers on the water going to Asia, going to Europe, none. Zero. And so that is going to that that bite will have will deepen every day.

[Carol Massar]

Okay. So I guess I don't know how do you then look at things longer term? Because I think what most folks are also thinking off of this war that things are going to be changed forever. In terms of people thinking about. We talked about this yesterday about countries access to strategic commodities, whether it's oil, whether it's, you know, really ensuring that their supply chains are solid, that they can't be disrupted. And that means a lot of domestic production. That means probably higher costs around the world. It feels like it's a very different global economy going forward.

[Almost Hochstein]

So I think that should we prepare for that? I think we will prepare for that. And in fact some of it is already happening.

[Carol Massar]

Yeah.

[Almost Hochstein]

So this is similar to two other events. One is the 1970s which led us to build a strategic reserve created the iea, the International Energy Agency. Structures of the energy market were different moving Forward after the 1970s. They were very different before changed forever. Covid changed how we think about supply chains recently got shocked by the supply chains which is why we started stockpiling. We started thinking about making sure that we didn't live on, you know, one supplier, etc. And now what's going to happen is the Strait of Hormuz is under Iranian control for basically for the foreseeable future regardless of nobody in the market should look at what the deal says eventually and believe it on straits. Iran will control the straits. Everybody in Washington may will believe it. Nobody in the Gulf, no one in the Gulf will believe they know the Iranians are not going to control the this. What does that mean? It means you got to change Carol, what you said you got to build out infrastructure that does two things. One, bypasses the Strait of Hormuz. It's possible to do. Yeah, it's not even that expensive. A few billion dollars, but a few billion dollars in what we're talking about doesn't cost very much. The redundancy is important. Second, build up more storage facilities in destination countries. So we already have some storage in places like Singapore, but build them, build them out in Tokyo, in Delhi, and China already has not just of oil but of jet fuel. Airports should probably hold a little bit more jet fuel capacity.

[Carol Massar]

Canceling flights for the summer.

[Almost Hochstein]

Exactly. Not just them. I think everybody, if you're, if you're, if you're an American listening to this and you think you're going on vacation this summer, plan for a very, very expensive one. Driving is going to be very expensive and so will RVs. RVs will be even more expensive because diesel is through the roof and jet fuel is.

[Carol Massar]

Can I ask you why this is happening right now? If it was President Biden and you were advising him, you know, were you guys pushing to do something to this effect in Iran?

[Suzanne Clark]

No.

[Carol Massar]

They have been a threat for how many decades?

[Joe Matthew]

Right.

[Almost Hochstein]

I just, look, we used to joke whenever people come say, oh, my God, we're.

[Carol Massar]

But I was, We've, we've had people come on and say, listen, this was long overdue. It was time to do something. We knew this was a country that hated America.

[Almost Hochstein]

Yes. By the way, they're not alone. If we're going to war against every country that hates America, then there's a list that we may have to go to war for a few more months, a few more years. North Korea, Funny. Actually, North Korea is doing a lot on nuclear. They hate America. We're not going to war there. Iran is a place where we, first of all, we had a deal with Iran to not go to a nuclear weapon called the JCPOA in 2015. President Trump got out of that in 2019. Probably should have stayed in because the deal we're talking about now that we will get is going to be very similar to that. There'll be some cosmetic changes, be very similar. We didn't have to do this war. I understood some of the rationale of the June war several months ago. They were cheating on the nuclear side. If they're not going to go back into a deal, a limited strike, and the Iranians in some strike back and the proxies didn't strike back. They didn't close the straits. It was limited in scope. It was limited in time. And so I understood that this war was a moment of opportunity. There were a lot of protests that were rising up and President Trump said helps on the way and all of a sudden got painted into the corner and then started coming up with reasons why we're in this war. Nobody really knows why we're in this war. No American really knows why we're in this war.

[Carol Massar]

I don't even think.

[Joe Matthew]

Yeah, but here that doesn't matter from the administration, but they change. You mentioned storage, though. I want to ask you about what's about to happen in Iran when it comes to their own oil storage. Because there's nowhere to put the oil at this point. They're loading tankers almost. They're putting oil supposedly on trains to China. The president says the whole underground infrastructure is going to blow up, which I'm not sure is true. But if they have to start shutting wells, that's going to be a pretty major moment and something that could happen in days or weeks. Do you.

[Almost Hochstein]

Well, first of all, it was supposed to happen already several days ago.

[Joe Matthew]

So that's not.

[Almost Hochstein]

It didn't happen.

[Joe Matthew]

Here's the why not.

[Almost Hochstein]

Because I've dealt with. There is real economies of oil where you look at the Baker Hughes manual. What do you do in this situation? And there's wartime and stress time. They're very different. I was spent. I spent a lot of time in southern Iraq trying to help them refix and so on. And if you went down there, no manual told you to do it.

[Steven Mnuchin]

They were.

[Almost Hochstein]

They should have been shut it. There is a way. Iran is a very good engineering country. They have remarkable engineering talent. They've been in the oil business hundred years. They know what they're doing. When we did them, I was in charge of the sanctions 15 years ago, so 2012. And we took them down to like 900,000 barrels of exports. And in some, instead of doing all of what President Trump suggests, you know, things blowing up and just shutting everything down, there are ways for them to do wartime economizing. Right. So you shut down one field, do some maintenance on it, then you bring it back, you shut down the next one. You can do a rotation, you can put. You could set fields on fire, which is a by design, which doesn't put any pressure on the pipes below ground. Wow. I don't expect to see any explosions. They are hurting economically, they are devastating economic pain in Iran.

[Carol Massar]

And yet here we are still at war with them. This is.

[Almost Hochstein]

I mean, they can handle the pain. Just saying they can handle the pain. And their view is how long can you handle the pain? And I'll tell you this, we're going towards a cliff on oil and oil products by the end of this month.

[Joe Matthew]

Physical shortages.

[Almost Hochstein]

We have physical shortage already, but it just in countries we don't care about. Okay, so then they will. Right, because they're poor.

[Steven Mnuchin]

Yeah.

[Almost Hochstein]

But then it'll go to middle income countries like Vietnam and Thailand. Then it goes to Japan and Korea and then it comes here. And here's the thing. You want to fly out of the United States, you can say, we have oil, we have jet fuel.

[Joe Matthew]

Right.

[Almost Hochstein]

Okay. Can't take it with you.

[Joe Matthew]

Wow.

[Almost Hochstein]

When you fly out, you got to be able to refill somewhere else.

[Carol Massar]

It's already making its way through manufacturing supply chain. Like you are feeling it.

[Joe Matthew]

And that's the airlines.

[Almost Hochstein]

AI spends a lot money of. Of money, hundreds of billions of dollars, which is not dependent on. But they're not dependent on consumer. What happens when consumers say, I can't spend this? Yeah, I have no money.

[Joe Matthew]

Almost.

[Almost Hochstein]

Thank you.

[Joe Matthew]

It's great to have you on Bloomberg. I hope Milken treats you well. Optimism Alongside Carol Massar, I'm Joe Matthew. This is Balance of Power live from L. A only on Bloomberg.

[Bloomberg Announcer]

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[Joe Matthew]

here at Milken on the geopolitics of supply, which of course is something that we talk about just about every day here, but interesting to hear from voices around the world. Those were business owners and executives operating in the Middle east, operating in Asia, and they each have a slightly different angle on this. Although it's a. It's a common thread throughout this conference.

[Carol Massar]

I feel like the supply chain grab is on and some people in some countries are certainly better positioned than others.

[Joe Matthew]

Chain grab. We should have called the panel.

[Carol Massar]

All right, I'll work on it. We're going to do a little bit of a switch to something that's actually top of mind because we have PayPal out today planning job cuts. The new CEO is really pursuing kind of a massive turnaround strategy at this company. They're going to make Venmo a standalone unit. But we think about these payment companies, Joe, that I don't know about you, but I'm using mine all the time, 100% kind of this concept of digital money. We want to see what Denise Leonard has to say. She's the chief of Zelle. I use Zell a lot. Thank you here at Milken. You're very welcome. Tell us about this, because this is a consortium of banks that are involved in it and it's kind of direct to bank to bank transfer. Tell us about your world, what you're seeing in terms of activity on the platform and what it kind of tells you about our economy.

[Denise Leonard]

Yeah, so we are owned by a consortium of seven of the largest banks, but we actually have a network of 2400 financial institutions. So that's everything from the largest bank in the United States, those small community banks and credit unions. And those are really important to us. And we have 160 million accounts on the platform. Platform that includes consumers as well as small businesses. And in December we actually had 100 million of those accounts were actually active. So during that holiday season, 100 million customers in the United States were actually

[Carol Massar]

using Zell, which is pretty typical. Or was that.

[Denise Leonard]

Yeah, it's actually pretty typical.

[Carol Massar]

Okay.

[Denise Leonard]

And we're just continue to see this increase in terms of digital payments. So we had $1.2 trillion moved on the platform last year. So that's larger than the GDP of Switzerland, to put that into context. And we're continuing to grow at 20% year over year. So we just continue to see more and more people move away from cash, move away from check and go to these digital payments.

[Joe Matthew]

You just had I believe your second consecutive trillion dollar year.

[Denise Leonard]

Exactly.

[Joe Matthew]

Where do you find growth from here? I know that you're working on potentially having an opportunity for people to pay their mortgages, to pay their rent. Recurring payments like this that might make your life a little bit easier. Is that the next opportunity for Zelle?

[Denise Leonard]

It is. So when we talk about the value proposition of Zelle, it's exactly how you described it. Moving from one account to another account and being able to do that quickly and safely and securely. So what we want to do is actually just open up more use cases for people to be able to use. So that includes small businesses. Includes. We have currently a pilot with bill pay with our friends at Truist Invest. We also have a pilot for donor advised funds in order to get into the charity space with bank of America. So we're continuing to pilot these and hoping to expand them and expand our roadmap.

[Carol Massar]

You just want more and more people on the platform.

[Denise Leonard]

More and more people and also thinking about us more and more often.

[Carol Massar]

Denise, where's the growth? You talk about bill pay, you talk about donor advise, you talk about small business. Where's the growth?

[Denise Leonard]

Yeah, I think that there is growth in all of it actually. So it's actually, it's just that recurrence and using us continually to make all those different payments to people or to small businesses that you know, and trust.

[Carol Massar]

Can you tell us in terms of data? I mean, everybody's got lots of data. Anything that's digital. So what can you tell us about the types of payments? And it doesn't give you any indication about the health of this economy. It feels pretty good. We talk about the market going up, but we know the market isn't necessarily what is going on in the broader economy.

[Denise Leonard]

So on the platform itself, we continually see this increase of overall payments. So again, 20% year over year. But what we're also seeing is this boom in terms of small businesses. So 30% of our volume is small businesses and that's actually our fastest growing segment. So part of the reason why small businesses love Zelle is because they get their money almost immediately and then they can be able to pay their workers, they can be able to go out and buy supplies instantaneously. So it's that quickness of payments that people love.

[Joe Matthew]

Is your sort of long term vision or your dream a cashless society?

[Denise Leonard]

Well, when's the last time you went to an atm?

[Carol Massar]

I don't know about you, Joe. They got rid of the penny.

[Joe Matthew]

They did. They don't make them anymore.

[Carol Massar]

I keep finding them in my pockets though, my daughter.

[Joe Matthew]

There is actually money under feel silly sometimes. I don't remember the last time I carried cash, but there are a lot of people that do. And I guess, I mean, is that the goal where cash is useless?

[Denise Leonard]

I mean the goal for us is that more and more digital payments, it's more safe, it's more secure and it's also more convenient.

[Carol Massar]

What is it? Does the structure stay just as, you know, multiple bank ownership? Is it something that this is a company that could essentially go out on its own? I think that makes sense.

[Denise Leonard]

It will stay in the current ownership structure. It's actually fun to be part of this ownership structure because you get the best payment minds in a room often. And really thinking about the innovation as the entire ecosystem moving forward.

[Carol Massar]

Yeah, it's kind of fascinating to see that. Thanks so much for stopping by. Thank you for having another snapshot of what goes on here at Milken. Denise Leonard, chief of Zell, joining Joe and me.

[Joe Matthew]

Stay with us on balance of power. We'll have much more coming up after this.

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[Bloomberg Announcer]

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[Carol Massar]

We are back here at Bloomberg Institute. Bloomberg, the Milken Institute. Did I just tell them that I just renamed it?

[Joe Matthew]

Well, we could maybe work on that for next year.

[Carol Massar]

We could do Milk and the Milken. Carol Massey, Joe Matthew here in Beverly Hills.

[Joe Matthew]

One thing we talk about a lot, and we've spent some time talking about the energy space. Yes, over the course of this program, almost Hochstein painted a pretty bleak picture. We also talked a lot about data centers. And these two stories come together in a way that has reinvigorated the conversation about nuclear in a way that nobody could have really predicted. We talk about it with experts in the industry, the need for more power. We talk about it with lawmakers who are trying to find a policy path. And our next guest can speak to all of this. Maria Korsnick is the president, chief executive officer of the Nuclear Nuclear Energy Institute, the trade group for the nuclear industry. It's wonderful to see you. I'm sure you've been awfully busy at Milken. This is a conversation a lot of people are trying to get close to, whether it's the small modular reactors that could end up landing around data centers, whether it's actually taking old decommissioned nuke plants out of the mothballs and putting it back online. When do we start actually building and seeing approvals when these projects are proposed?

[Maria Korsnick]

Well, we're doing that already. Right. So you have the TerraPower had their construction permit approved out in Wyoming. They're beginning construction. They're building actually in Canada. The GE Vernova first SMR for that's about 300 megawatts. And then down in Tennessee, the Kairos Power Test reactor is under construction as well. So we have actually, you know, transitioned from just some great ideas to actual construction.

[Carol Massar]

When does nuclear that become something really significant in the United States in a country where we know there's a lot of neighborhoods, a lot of areas that just don't want to have any kind of nuclear facility in there in their area?

[Maria Korsnick]

Well, we're 20% of the electricity sector today, so I would say nuclear is already making a difference. And honestly we're not hearing the pushback that you're mentioning for local communities anymore. One of the latest polls showed greater than a 60% favorability rating for nuclear and climbing. I think part of that is what you mentioned. It's the data center conversation. Data centers are looking for really reliable energy. They'd like it to be clean. Nuclear is here to help. And so you're going to be seeing, first of all, extending the lives of plants. We have started out 40, we got it to 60, have over about 25 plants approved for an 80 year life. Okay. So what you have is going to last longer. What you have can make more power. So three quarters of the fleet are going to do power upgrades that's going to bring 5 ish to 6 gigawatts of new power to the grid. And that can be short term.

[Joe Matthew]

Are the near term solutions small modular reactors or should people get used to seeing large plants like we used to, Just a different style scale in the old days?

[Maria Korsnick]

Yes, all of the above.

[Joe Matthew]

Okay. You want an SMR on your property?

[Carol Massar]

Yeah, it might.

[Maria Korsnick]

So a couple different things. If you're a data center, you need that power constant, constant, constant. Right. They don't want to have that potential as well. Could be off the grid, but because of the high reliability that you want, you might want to have a couple of small packages rather than one large package. If you're a really big data center, you might want several large packages. So I think it depends on your solution, but it's literally all of the above. From the large gigawatt size to the medium size to the even really small we call a micro reactor. So think less than a megawatt even. And so you're going to be able to look at nuclear as a solution set in ways that you just never thought.

[Carol Massar]

You mentioned the SMRs though. Do we really have a viable design? And it's happening because I feel like we've been talking about it. So how long though before those are actually in use in production?

[Maria Korsnick]

One's in construction in Wyoming, one's in construction in Canada. You just heard X Energy within the last two weeks do their IPO raised over $1 billion. That's an smart.

[Carol Massar]

Are they up and running? What are you hearing?

[Maria Korsnick]

So early 2030s, I think for that design. But the GE design I think is talking about being online in 2030 and same for the TerraPower design.

[Carol Massar]

Do you think when you guys ask Americans if they're comfortable with it, I mean, is it because there is it against the backdrop of higher electricity prices? Because I think Americans are feeling so squeezed and is that where they say, okay, if that's what's going to make it less expensive for me, I'm in.

[Maria Korsnick]

You know, it's a combination of things. You want energy security, nuclear has that. Do you want it clean? Nuclear has that. You want it reliable, nuclear has that. I mean the value proposition broadly for nuclear. And it's not just here in the United States, it's around the globe.

[Joe Matthew]

What do you need from Washington? What do you need from policymakers to continue the growth?

[Maria Korsnick]

It's still hard to go first. So one of the things that we're asking for from a legislation perspective is what's called the ARC act, which is something that's going to help the government lean in on a little bit of those first of a kind risks just to help those get ameliorated so you can move right in. The other thing is we got some energy credits, the tax credits, and they're wonderful. A couple of tweaks. Would like to opt out of normalization to let you get that tax credit faster and some transfer ability. And both of those are in legislation that's on the Hill now.

[Carol Massar]

All right, interesting stuff. We didn't talk about nuclear waste, which is always an issue to start. I'm going to leave it there, Maria, though, thank you so much. Because I do feel like when we talk energy, you're right. Everybody's saying we need it all in order to power. Maria Korsnick, Nuclear Energy Institute CEO, joining us right here at Milken.

[Bloomberg Announcer]

You're listening to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon and 5pm Eastern on Apple CarPlay and Android Auto with the Bloomberg business app. Listen on demand wherever you get your podcasts or watch us live on YouTube.

[Joe Matthew]

Thanks for being with us on what we'll call a special edition of Balance of Power here at the Milken Global Conference. Special take special indeed. Well, Carol Massar's with us. It's got to be. I'm Joe Matthew, as you just heard, live at Milken. And and it's been an interesting conversation Today that we want to continue here by going to the top of the mountain with the face of American business.

[Carol Massar]

I have to. Exactly. And I feel like all the conversations we've had lead up to this, whether we talked about energy, higher costs, inflation, supply chains, geopolitics, politics. In Washington, Suzanne Clark is with us. She's President CEO of the U.S. chamber of Commerce, a great voice. When it comes to what's going on in the, in the business community, what is top of mind? Because the laundry list of things that is coming at American businesses right now is a lot.

[Suzanne Clark]

Well, thank you so much. Thank you for having me. I was saying a minute ago that we were just with the L. A Chamber yesterday and it's such an opportunity to get out and talk to local businesses, big and small about what's happening in their community. And what we see is businesses really trying to deal with all of this uncertainty. What should they be doing about finding workers? What should they be doing about their supply, supply chains? What will happen with the economy? What does AI mean? So all the things that you've been tackling all morning, business leaders are live trying to figure out themselves.

[Joe Matthew]

What conversations are you having when it comes to affordability? I know you were on a panel today with Neera Tanden. It was on the broadcast a little bit earlier. Both of you, I'm sure, coming from different perspectives when you're trying to keep American business in mind, knowing price pressures from the gas pump to the grocery store are very real, you reached for the word uncertainty first. How do you speak with your members about this or the challenges they're facing and about to face?

[Suzanne Clark]

Well, you know, let me say first that Mira and I had violent agreement about the need for permitting reform.

[Joe Matthew]

Right.

[Suzanne Clark]

That we really need to build things faster.

[Bloomberg Announcer]

All of it, right?

[Suzanne Clark]

It's housing, it's electricity, it's utility costs, it's, you know, so what could we do as a country to build things faster, more efficiently and cheaper? So that comes up with affordability. The U.S. chamber, we really believe a lot of the root of the affordability problem is a supply constraint. Right. We don't have enough housing, we don't have access to health care. We have labor shortages in key sectors. We don't have a resilient supply chain. So the question is if we want long term economic growth, 3% growth that lifts up families and communities in the country and helps pay off debt. If we want all of that, we got to take some of these structural issues really seriously.

[Carol Massar]

Like which one? If we could tackle one right now, in this given moment, what would it be that you think the American businesses could really get behind and say, this is a game changer?

[Suzanne Clark]

I really think would be permitting reform. Think about the fact that it takes five to seven years to get a permit. In that time, you'll have a change of administrations, most likely.

[Joe Matthew]

Right?

[Suzanne Clark]

So if you have one administration that prefers one type of energy, if a different administration prefers a different type of energy, how do you decide where to invest and what to build? And yet, at the same time, as you've reported, we need all of the above.

[Carol Massar]

Suzanne, how do we get there, though? Because I think about, you know, the American business community, they have a great line often to the White House and to lawmakers. So how do they say, hey folks, it's not just about four years, four years, four years. It's about a 10 year plan. China does it. It's a whole different country. And I know that. But how do we do that so that we really commit longer term to build some of these things that need that perspective?

[Suzanne Clark]

Such a good point, Carol, because we certainly do not want a government planned economy.

[Carol Massar]

Right.

[Suzanne Clark]

None of us are for that. But you're right that we do need government to set the conditions so that we can grow, so business can solve these problems at scale that society really needs answers to. And I think maybe we have to do two things a little differently. One is talk to more people at the local level, local businesses, local chambers, and get them to drive community support for politicians who are willing to do some hard things. And two, I think businesses are going to have to get more involved earlier in the process and the primary, primary process and really thinking about candidates who don't want to just admire the problems and say expedient things, but are willing to do hard work and take hard votes.

[Joe Matthew]

You know, I think about you sitting in your headquarters right, right across from Lafayette Square, looking out the window at that White House. You've been there a lot longer than this administration. And to your point, you're going to be there for administrations in the future. But this Trump administration has embraced crypto in a way that we have not seen in a White House before. And of course, the timing has a lot to do with this, with this suddenly kind of going mainstream. And there's a clarity act that Republicans and some Democrats are hoping to see past this this year. In fact, it could be sooner than later. Are we managing the rules of the road when it comes to crypto in a way that the chamber can support this approach?

[Suzanne Clark]

I really like the question, and I really, even more like the preamble.

[Denise Leonard]

Right.

[Suzanne Clark]

Which is we just had our 114th birthday. I know I don't look a day over 112. I really feel like a month. Thank you. I really feel the weight of the fact that who was the guy in my office in the Depression or in World War II or, you know, and how did they think about emerging technologies, emerging financial instruments? How did they think about the impact on working families and communities and American security and competitiveness? And how do we do the long term right things while being empathetic to the real short term pain? So I think your preamble was just so important. We actually do need institutions with historical memory and reach. And I think it's really important.

[Joe Matthew]

Sound like an institutionalist is. But the Chamber not taking a position in crypto.

[Suzanne Clark]

Look, I think what we want to do is be supportive of new technologies at the same time that we don't lose sight of what really works in this country in the traditional capital markets and traditional financial services.

[Carol Massar]

Watching this so closely and they've gone from pushing back completely. Not interested to embracing slowly, but I think moving carefully. But there is this concern, we talk about disruption, innovation, that how could something like the digital world or crypto currencies replace so much of what the banks do? So is there a lot of pushback that you guys are getting in the banks?

[Suzanne Clark]

At what point is that innovation good? And is what point that. Is that disruption dangerous?

[Carol Massar]

Right.

[Suzanne Clark]

And it's what you're always balancing with the new technology. And so I applaud these industries and these companies that are educating Congress, getting to point where we can do something that makes sense and makes sense for business.

[Joe Matthew]

It's of course, not just crypto. When we think of emerging technologies. There's another industrial revolution happening right now.

[Carol Massar]

Have you heard of it?

[Joe Matthew]

Take the words from Jensen Long. That's what he calls it. How concerned is the Chamber about? To your point, there are wonderful things that AI is bringing to us, but there could also be a negative disruption when it comes to the job market. Is that a worry of yours?

[Suzanne Clark]

Do you want to hear something cool? Just fast, fastest. The people having the fastest uptake of AI. Small business.

[Carol Massar]

Okay.

[Suzanne Clark]

It's the first technology in the United States that small business embraced first, which is really a leveling out.

[Bloomberg Announcer]

Right.

[Suzanne Clark]

A great equalizer. Last year the United States had 5.6 million new business starts. That's optimism for you. And some of that is that they can do more with AI, which is really fascinating. So the answer to your question is of course, everyone can see there's a disruption coming. We don't have revolutions without some kind of disruption. So how do we help people through that? Because we're long term optimistic about job growth, about health impact, about the innovation, about what it does for our country. We want to compete with our adversaries.

[Bridget Mendler]

Right.

[Suzanne Clark]

So I think this is a really important topic and we're going to have to do reskilling and education. But the short term disruption I think is going to lead to a nice hockey stick.

[Carol Massar]

You know, we need a little bit of optimism. I feel like there's a lot of serious stuff we've talked about.

[Joe Matthew]

Let's take it. Yes. Thank you for the optimism, Suzanne.

[Carol Massar]

What a pleasure. Thank you so much.

[Suzanne Clark]

Thanks so much for having me.

[Carol Massar]

Suzanne Clark, Presidency of the US Chamber of Commerce.

[Bloomberg Announcer]

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[Joe Matthew]

We are going to go to space here to talk about another emerging technology, but it's also one that has been rather mainstream and it's not just Space X, it's not just Jeff Bezos. There's a massive collection of companies that fulfill what we call the modern space industry. And one of them is Northwood Space, where Bridget Mendler is CEO and co founder and joins us right now live from the Milken Global Conference. It's wonderful to see you and welcome. You actually control the ground infrastructure that helps to make satellites work. As I mentioned, it's not always the most obvious type of approach that your company has found. Some something unique. When you're talking to business leaders here at Milken, what markets are opening for you? What what does this mainstreaming of space mean for your company?

[Bridget Mendler]

Yeah. Well, thank you both very much for having me. It's fun to have the occasion to talk about space at a forum such as this.

[Joe Matthew]

Yeah.

[Bridget Mendler]

And what we do is that networking infrastructure between Earth and space so enabling all of the space missions that we are seeing commercialize, whether it's it's things like direct to sell applications, really expanding the telecom sector or different national security priorities or you know, enthusiasm around compute and growing compute solutions from orbit, really bringing a lot of the industries that have typically been terrestrial into a more expansive architecture that goes beyond got to

[Carol Massar]

ask you because again, somebody like an Elon Musk and a lot of stuff that he is doing, whether it's Starling, tell us what how you Differentiate what you guys are doing from a lot of the big players. So we understand exactly what this business is.

[Bridget Mendler]

Yeah. And so what we're excited to solve with our company is the networking infrastructure for the industry writ large. We tend to draw comparisons to like an AWB platform where you think about not everybody was able to have their own IT department and local data storage solutions. And so, so us opened up that solution for many more companies to grow and blossom. Think about the whole SaaS ecosystem that we've been able to see grow and expand as a result of that. And so for the space networking solution, the kind of nuts and bolts of that networking, it's not really a differentiated solution for a lot of space companies, but it consumes a lot of their time, a lot of operational overhead, complexity and cost. And so for us, if we can do that at scale, provided as a generalized solution for the industry, then that opens up a lot of different businesses to really grow their prospects.

[Joe Matthew]

I just have to acknowledge what everybody's thinking watching this right now. Yes, this is the same Disney Channel. You're a Disney Channel actress, you're an award winning Bridget, you have singer songwriter

[Carol Massar]

fans around you and me.

[Joe Matthew]

Yes, this is the same Bridget. How do you go from that world to investing your life in a space company? You know, you could be doing anything right now.

[Bridget Mendler]

You know, I think the space industry is full of people who are just extremely passionate, curious and I feel really grateful to have discovered that community. And I also feel grateful that the world is kind of opening up its excitement around the mainstream aspect of this industry. Think about, you know, Artemis this year. Think about SpaceX IPO.

[Joe Matthew]

Is there a halo effect from Artemis on all of your businesses?

[Bridget Mendler]

I think what it, what it points to is that these missions are becoming possible in a way that is more mainstream and that's really the core of our business. The core of our business is how can we take all of these ambitious missions and get them further faster by providing the infrastructure that is, is kind of common and serves to be a strong foundation.

[Carol Massar]

I have to the Bloomberg team back home, they know my dad was involved in the initial space race. So we kind of grew up with this. And it's really fascinating to see it move so much into the private sector and kind of away from the government. Having said that, I'm curious about who's working with you? Who are your customers? Who's funding you? Like, what's the longer term plan?

[Joe Matthew]

A big round of funding?

[Bridget Mendler]

Yes. We've raised around 140 million to date and our customer base is very intentionally broad. We want to serve the whole space industry. And so that includes government customers, customers, customers that require ground connectivity for solutions ranging from launch to GPS satellites that power a ton of diverse applications terrestrially to sensing applications. And then you have real commercial industry. So we're in communications with multiple public communications companies in space that are trying to resolve their networking infrastructure.

[Carol Massar]

Where are you in terms of development and deployment? And just got about 30 seconds.

[Bridget Mendler]

Yeah, yeah. It's a really big year for North Wood. We last year was about developing our very first site, our very first operational units. This year it's about scale. So we currently have sites in multiple continents, both in Australia and the United States. We're planning to be on eight different countries this year and producing nearly 100 antenna units. So it's going to be a very busy year.

[Joe Matthew]

When you go into space, you know

[Bridget Mendler]

that's, that's working on it, right?

[Carol Massar]

That's about one of our producers, James, I think think wants to go to space too. I'm just going to tell you over there.

[Joe Matthew]

James is actually with us at Milk and I'm glad you pointed that out. Bridget, it's wonderful to meet you and great to see you. Thank you for all of your insights. Northwood Space is the company. This is Balance of Power. She's Carol Massar and I'm Joe Matthew. Thanks for listening to the Balance of Power podcast. Make sure to subscribe if you haven't already. Apple, Spotify or wherever you get your podcast. And you can find us live every weekday from Washington D.C. at Noontime [e-mail]

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