The Money Show: SpaceX Market Impact and Solving Social Security

Summary

Bloomberg Surveillance: The Money Show

Episode: SpaceX Market Impact and Solving Social Security
Date: June 12, 2026
Hosts: Tom Keene, Scarlet Fu
Guests: Yahir Anand, Ed Ludlow, Isabel Lee, Mandeep Singh, Jim Chanos, Nikki Waller, Jack Lew

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Overview

This special edition dives deep into the historic SpaceX IPO, examining its impact on markets, investor reactions, and the strategic moves behind its $2T+ valuation. The episode also features a robust discussion on the future of Social Security, highlighted by insights from former U.S. Treasury Secretary Jack Lew, and covers broader themes of financial planning, retirement, and current economic events. The conversation is rich with market analysis, industry skepticism, and a look at America's financial future.

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Key Discussion Points and Insights

1. SpaceX IPO: Market History in the Making

Timestamps: 02:04 – 13:13, 13:28 – 26:44, 45:28 – 49:05

• IPO Details & Market Reaction

  • SpaceX debuted at $135 per share, opened at $155, giving it a valuation just under $2T—making it instantly more valuable than Tesla, Saudi Aramco, and Meta.
  • “The excitement was palpable here... SpaceX has officially begun trading... at a value instantly putting it among the most valuable companies in the world.” (Yahir Anand, 02:31)
  • After a surge, the price stabilized, indicating frenzied but somewhat orderly trading.
  • Early retail investors were highly sought after, but allocations were oversubscribed, with only about 20% of shares going to retail (Ed Ludlow, 05:20).
  • ETF providers hurried to list SpaceX-linked ETFs, with over 20 planned and several delayed due to risk concerns (Isabel Lee, 06:38).

• Retail vs. Institutional Dynamics

  • Management's belief: the retail investor understands SpaceX’s vision better than Wall Street.
  • “SpaceX, its management... genuinely believed that the retail investor was so important for the long term... highly analogous with Tesla.” (Ed Ludlow, 05:34)
  • Retail FOMO (fear of missing out): Many latecomers are willing to “overpay just to say I’m part of the thing.” (Nikki Waller, 28:54)

• Valuation Skepticism

  • Mandeep Singh compared SpaceX ($2T, $18B in revenue) to Meta ($1.5T, $200B in revenue), questioning how such a premium is justified:
    • “Meta’s revenue run rate is $200 billion. SpaceX is 18 billion. How can Space X be 30% higher than Meta?” (Mandeep Singh, 08:14)
  • Jim Chanos, known short-seller, called the IPO “hopes and dreams,” likening the environment to the 1999-2000 dot-com bubble:
    • “What I think Space X is ushering in in 2026 is massive equity issuance... when you have massive IPOs and secondaries... investors generally have been advised to be a little more cautious or reduce risk.” (Chanos, 14:00)
    • Chanos highlighted a last-minute pivot in SpaceX's business model from high-margin AI models (Grok) to lower-margin cloud leasing (“neo cloud”), questioning the sustainability of such valuation (16:09).
    • Warned that a business priced at 100+ times revenue tends not to deliver solid returns for buyers (17:54).

• Operational and Technical Hurdles

  • Starlink is considered SpaceX's solid business unit, but its growth is slowing.
  • The core rocket, Starship, has yet to achieve orbit after 12 missions, with multiple failures (Chanos, 19:08).
  • Sudden business pivots before an IPO raise questions about transparency and future focus.

• Silicon Valley Impact

  • Liquidity from SpaceX’s IPO is expected to seed new startups and venture activity, echoing past tech booms (Ed Ludlow, 09:54).

• Market Mechanics

  • Technical glitches on platforms like Robinhood due to surging retail demand (Yahir Anand, 45:58).
  • Questions over long-term pricing accuracy: “It’s a matter of whether the price is still right a week from now or two months from now.” (Scarlet Fu, 47:13)
  • Short-selling remains difficult and risky in the current bull trend (Chanos, 22:54).

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2. Social Security in Crisis and Policy Solutions

Timestamps: 31:13 – 41:58

• Trustees’ Report & Urgency

  • Social Security is projected to be unable to pay full benefits by 2032—raising the prospect of a sudden 22% cut if nothing is done.
  • “Having the idea of a 20 to 25% cut in benefits is unacceptable... The majority of people retiring rely on Social Security for most of their household income.” (Jack Lew, 33:51)

• Historical Parallels & Negotiations

  • The 1983 Greenspan Commission is cited as a successful bipartisan fix, and current reform efforts echo its mix of revenue increases and benefit adjustments.
  • “The challenge is how do you create a sense of urgency... Any solution... requires some time to take effect.” (Lew, 33:51)

• Legislative Realities

  • The window for bipartisan action is tight; solutions are needed in the next presidential term to avoid disruption.
  • Recent proposals mix benefit and revenue tweaks and have cross-party support.

• Common Misconceptions & Public Attitudes

  • Many people wrongly believe Social Security will “run out”; even when the trust fund is depleted, payroll taxes will keep 78% of benefits funded (Lew, 36:16).

• Deficit, Debt, and Political Will

  • Fixing Social Security is seen as a first step toward broader fiscal stability in an era of ballooning deficits.
  • “Will the world support our borrowing needs in years to come? Just printing money... adds to that process.” (Lew, 36:52)

• Policy Ideas

  • Raising the income cap on payroll taxes is seen as a relatively painless solution that could target higher earners (Lew, 40:36).
  • Systemic reform—“We're going to have to talk about taxes... and we can't talk exclusively about taxes.” (Lew, 39:08)

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3. The Retail Investing Experience and “Musk Fandom”

Timestamps: 28:54 – 31:13

• Experiential Investing

  • “This has become experiential... It’s not just about being part of your portfolio; it’s about being part of the experience and being a Musk fanboy.” (Scarlet Fu, 28:54)
  • No unified retail voice—sentiment is split between believers in long-term vision and more value-conscious skeptics (Nikki Waller, 29:48).

• ETF and Index Inclusion

  • Many expect SpaceX to be included in major indices soon, meaning passive funds and 401ks will pick it up by default within a year (Nikki Waller, 30:58).

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4. Book Recommendations: The Musk Mindset

Timestamps: 47:36 – 49:05

• Book picks shaping Musk:
  • Foundation Series by Isaac Asimov (inspired Musk's “dreaming” and is literally in the car shot into space)
  • The Hitchhiker’s Guide to the Galaxy by Douglas Adams (helped Musk “formulate the right questions”)
  • Benjamin Franklin: An American Life by Walter Isaacson (“America’s first entrepreneur” and Musk role model)
    • “Elon Musk admires Ben Franklin... for his journey from entrepreneur to inventor, and that’s kind of how Musk sees himself.” (Scarlet Fu, 48:49)

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Memorable Quotes

• “The excitement was palpable here at the Nasdaq... instantly putting SpaceX among the most valuable companies in the world.”
  — Yahir Anand (02:31)

• “SpaceX... believed, genuinely believed, that the retail investor was so important for the long term... the story is complicated.”
  — Ed Ludlow (05:34)

• “Meta’s revenue run rate is $200 billion. SpaceX is 18 billion. How can Space X be 30% higher than Meta?”
  — Mandeep Singh (08:14)

• “What I think Space X is ushering in in 2026 is massive equity issuance... investors generally have been advised to be a little more cautious or reduce risk.”
  — Jim Chanos (14:00)

• “Does the Elon Premium double the value or does it basically say, okay, I’m going to pick one [company]?... Neither of them are being valued on their operations.”
  — Jim Chanos (17:54)

• “It’s unacceptable to have a 22% benefit cut... Most people retiring rely on Social Security for most of their household income.”
  — Jack Lew (33:51)

• “We're going to have to talk about taxes. We can't talk exclusively about taxes. If you fix Social Security... it helps.”
  — Jack Lew (39:57)

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Segment Timestamps

• 02:04 – 13:13: SpaceX IPO launch coverage, retail and ETF involvement
• 13:28 – 26:44: In-depth skepticism: Chanos on SpaceX’s valuation, operations, and market cycles
• 28:54 – 31:13: Retail sentiment and the Musk “experience”
• 31:13 – 41:58: Social Security history, crisis, and policy discussion with Jack Lew
• 45:28 – 49:05: IPO update and Musk’s recommended reading list

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Tone

Candid, energetic, and at times irreverent—combine sharp market analysis, healthy skepticism, and an eye for the bigger social and policy picture. The hosts pepper conversations with humor, pop culture references, and direct challenges to their guests.

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Summary

This action-packed episode captures a momentous week for markets, with the SpaceX IPO rewriting valuation records and stirring investor passions, and a frank, expert look at the looming Social Security crisis. Big themes: Faith in Elon Musk, the limits of “hopes and dreams” investing, new paradigms in public market access, and the urgent need for bipartisan fiscal policy. Whether you’re contemplating your portfolio, worried about your future retirement, or just along for the market’s wild ride, this episode has perspective, skepticism, and plenty of memorable moments.

Transcript

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[Tom Keene]

This is the Bloomberg Money Podcast. I'm Tom Keene with Scarlet Fu. Join us each week for a smart look at the forces shift shaping your financial life. On personal finance, on retirement and wealth management, we will explore how people are earning, investing and building wealth. We are live Fridays at noon Eastern on Bloomberg Television. Subscribe to the podcast wherever you listen. And as always on the Bloomberg Terminal and the Bloomberg Business App.

[Scarlet Fu]

Of course, we do want to bring your attention to what's happening with Space X. The company began trading today after ipoing yesterday at $135. The opening trade was 150, although it's worth noting for those who were keeping track that the indicated open had been steadily declining from earlier in the day. Let's go over now to Yahir Anand. She is our Bloomberg Television correspondent joining us from the Nasdaq in the middle of all the action. Yahir, take us through what we've seen so far.

[Yahir Anand]

Well, the excitement was palpable here at the nasdaq. Scarlet and now Space X has officially begun trading. As you said, the stock opening at $155 a share above its $135 price, giving investors, an immediate gain of roughly 11%, though now we are higher. But that opening value does price the company at Approximately an under $2 trillion market cap, instantly putting Space X among the most valuable companies in the world. It's more valuable than Tesla itself, another Elon Musk company, of course, but also Saudi Aramco and Metta.

[Scarlet Fu]

Thank you so much for that context because we talk about all the superlatives attached to this ipo. It's also going to make a lot of early investors very wealthy. Walk us through some of those names.

[Yahir Anand]

Exactly. I mean, you have the, the Peter Thiels of the world that bet early on this company and will make tens of billions of dollars. Sequoia, another early founder. And what was striking to me this morning is obviously there are a lot of skills skeptics on Wall street on this name. It is has a very has an unprofitable timeline for quite some time. They have lofty ambitions of having data centers in space by 2028. But here on the floor with the investors and the bankers, they are excited because they are about to make a whole lot of money. Scarlet. So that is why while you have the scarlet skeptics out there in this room, there was nothing but excitement. And also from the nasdaq, which won this listing.

[Scarlet Fu]

All right, good stuff. Yahir, thank you so much. Higher Anand, Bloomberg Television correspondent joining us from the nasdaq where Space X began trading today for the first time, opening at $150 after pricing its IPO at 135 last night. Tom, Bloomberg Money.

[Tom Keene]

It's money. Is it a little different? I think it's a little different.

[Scarlet Fu]

You know, we had to mix it up already.

[Tom Keene]

Let's call special edition of Bloomberg Money. We'll get to that later with some wonderful voices for you on Space X and of course, the uproar in Social Security. But this is what Bloomberg is about. The intellectual capital at the firm worldwide is extraordinary and critically eclectic. And for Space X that's important. Joining us with all of his expertise tiered up at Caroline Hyde, Ed Ludlow continues with us here. Isabel Lee is in the trenches of the retail effort. We'll speak to her. We're going back and forth with Eric Belchuna here on the ETF market and we're thrilled. Mandeep Singh with us. With all the technology today, I don't even know where to begin. I guess I'm going to start with Ed Ludlow right now. When you look at the quote unquote allocations, what's the gunpowder into the Closing bell here.

[Ed Ludlow]

In fact, everyone is disappointed. Everyone is disappointed, Right. Like it's not just a matter of oversubscription on the retail side. So what Bailey and I reported is that the allocation was about 20%. Yeah, 15 million.

[Tom Keene]

They're on their phone screaming, screaming.

[Ed Ludlow]

And you know, Nancy Tangler of Laffer Tangle, that's more like a wealth management issue. Right. But she just on the show saying, I'm buying at the open market. I don't want to be. I'm buying at the open market. The main point here was that Space X, its management, specifically its management, forget the bankers, they believed, genuinely believed, that the retail investor was so important for the long term. Right. That they actually understood the story way better than Wall street does. Highly analogous with Tesla, right? That story's paid out. The retail investor base is a big part of Tesla's story. But 20%, that seems low, you know? And so what do you do? Do you go under the mattress, get your cash and then run and try and play the open market? I don't know. But I know that a lot of people that are trying, a lot of people are trying.

[Scarlet Fu]

And those who can't do it may be doing it through other synthetic means. Isabel, the ETF industry has made a lot of money creating single stock leverage products. And you've been reporting how this ETF industry has been tripping over itself to do the same with Space X. How many space x linked ETFs are there right now?

[Isabel Lee]

There are more than 20 space x linked ETF, but around a dozen are slated to launch on Monday. And they're all bummed because they wanted to launch today, Friday, like just hours after SpaceX go public. But then the exchanges were like, nope, we think it's too risky. Of course, they declined to comment, so I'm putting words into their mouth, but that's what you could speculate from them. But we have one that may launch today, I think. I don't know what they did. They did some maneuvering, but I'm trying to get that story out. But they launched today. It's defiance. But I want to briefly jump to Ed's point. I got a retail trader on the phone earlier and it was around 830 and he said he put in an order by E trade on Monday. And then on the phone he was like, oh, I got an allocation. And then just an hour ago he said, oh, but out of the 40 shares I requested, only 11.

[Tom Keene]

Right.

[Yahir Anand]

I received.

[Tom Keene]

I'm going to set up being deep right now, but I'm go Back to Ed Ludlow to to go to Mandeep. In your world, there's respect for people like Mandeep Singh. What do the fundamentalists think of all this roulette? Real retail action.

[Ed Ludlow]

So when I say that Space X believes the retail investor knows the story better, right? The story is complicated. And Mandeep, in the research that you published, we were just discussing it on air, is there is the very distant future where humans live. Live on Mars. I know, Tom. Humans live. I know. But just give me five seconds. I'll go to Mandy. I promise. Humans live on Mars. Then there is the present day where this company is making a really big move to rent compute capacity to others. It's neo cloud business. And then the in between is data center.

[Tom Keene]

Talk to Jim Chanos about that. Your thoughts here on the roulette wheel that Mr. Musk faces is it is a trillionaire.

[Mandeep Singh]

I mean this reminds me of Palantir. Palantir is a stock that traded way above every software company because retail just believed in the company. And it was high growth for a while. It still is a fairly high growing company. But when I compare, you know, Space X valuation at 2 trillion to Metta at 1.5 trillion, a company with 10 times more revenue. Meta's revenue run rate is 200 billion. SpaceX is 18 billion. How can Space X be 30% higher than Metta? And it just to me this quickly

[Tom Keene]

or Scarlet just the moon shot up from 150 up to a higher level. We've pulled back just a bit. Finally up 18%. Finally a little bit of pre trading stability.

[Scarlet Fu]

All right, well, we'll see how it all shakes out. Mandeep, there are 23 banks involved in this IPO. So Wall street has a lot riding on the success of this offering. What do the sell side analysts, brokers, financial advisors likely see and wish they could say out loud but can't because of their bank's relationship with the company.

[Mandeep Singh]

I mean it has to be valuation like, you know, the Meta example to me is Prime, a company that generates, you know, almost 00 billion in free cash flow. Yes, it's investing a lot in Capex right now, which is why the multiple is compressed. But it's got $200 billion in real revenue. It's growing 30%. Very sticky user base. SpaceX has to has a lot to prove. And yes, they signed those two deals, but that's not going to be enough

[Tom Keene]

for I got to squeeze this. And you're going out of Middletown in the Gulf Stream this afternoon back to San Francisco. How is your San Francisco, how is your Silicon Valley changed with this transaction?

[Ed Ludlow]

Well, so there's, there's a big misunderstanding that the 4,000 millionaires at Space X were minted, will sort of retire to the beach, go down to Newport beach and sling my ties that no, there's been lots of liquidity events at Space X. It is a leader in this new era of private companies staying private longer but doing secondaries. So what you'll see in Silicon Valley at large is that those 4,000 are more likely to start their own company or they're more likely to buy, become venture capitalists. You know, that is a big ripple effect. You see the same thing with open air and anthropic in AI too.

[Tom Keene]

This has been wonderful. Fabulous to have all three of your Mandeep Singh, Isabel Lee in AD Ludlow, safe travels as you can. Coming up, Ed Ludlow mentions the Neo Cloud. Jim Chano's I'll cut to the chase. He is skating. He calls this IPO hopes in dreams. Stay with us. A special edition of Bloomberg Money.

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[Tom Keene]

Welcome back to Bloomberg money. I'm Tom Keene with Scarlet Fu. It is is a very special edition here. Yes. On your personal finance, on your retirement. Scarlett, did you get your leveraged ETF set up for SpaceX?

[Scarlet Fu]

You know I can't do that. I am only passive.

[Tom Keene]

You're very passive. Passive with SpaceX this morning we're seeing the pricing here with some stability are up 21% off the 150 level. This is indeed an honor joining us now. He's been extremely active on global Wall street in the last four or five days. James Chanos is with Chanos Co. Definitive on the street of a cautious view. Jim Chanos, honored to have you here. Let me just cut to the chase. What is a distinctive feature that makes Space X remind you of Enron?

[Jim Chanos]

Well, I don't know that it reminds me of Enron, Tom, but it reminds me of the Enron time frame. How's that in that? I've always said that Wall street has a printing press too, just like the Fed. It just takes a while to get going. And one of the things that I think Space X is ushering in in 2026 is massive equity issuance. And, and historically, without a doubt, in the 20th and 21st century, any time you have seen massive IPOs and secondaries relative to the size of the market or the economy, investors generally have been advised to to be a little more cautious or reduce their risk. So 1999, 2000, 2021 for the first half of that year during the meme stock and SPAC craze, we are now going to break records in 2026 for IPOs and secondaries. And Space X, of course, is the granddaddy kicking it all off in a big way. But we're going to see open air, anthropic and probably some others. So we're going to shatter records. And so it's telling you that right now supply is meeting demand, which we haven't seen, by the way in 23, 24 and 25, but we're seeing it now in 26.

[Tom Keene]

I look Jim Chanos at this and we've got a wonderful Amount of time here with Mr. Chanos. So much to talk about. Scarlet's got some themes. I have some themes as well. Ed Ludlow fronted me. See how he did that?

[Scarlet Fu]

Yeah.

[Tom Keene]

Just stole my thunder.

[Scarlet Fu]

He needed to do it.

[Tom Keene]

Chanos is thinking about the NEO Cloud. This is the team here. The New York Times article of a day or so ago, is space x worth $1.8 gazillion? Xi seems to be suddenly changing its business model from developing models like Grok to basically becoming an ad Ludlow, NEO Cloud. The entire valuation rests on xi's progress. The NEO Cloud strategy is a commodity business that is valued far lower on the public markets. Jim Chanos to Isaac and the crew over at the New York Times. They're talking innovation, but you're predicting they'll go safe.

[Jim Chanos]

Well, what's, what's really interesting, Tom, is that About a week, 10 days ago, the vast driver for the Space X TAM in their prospectus was the enterprise solutions for xi. Basically Grok what, what, what the models produce, right, the software. And instead they basically did a 180 pivot and said we are going to lease out our capacity to Anthropic and Google. And that's the NEO Cloud model, right? That's your equipment lessor and that is a much lower valued business in the marketplace than being a model company or a hyperscaler. And we've been following data centers for a long, long time. And basically it's a finance business, right? You're buying the chips from Nvidia, somebody else and then you're leasing them out to Anthropic or it's a rate of return business. It's not a super high tech business yet. 22/trillion of the 29 and a half trillion of space X TAM in their prospectus was based on that business. And it just struck me as very, very odd that right before the IPO they would pivot to a much lower margin and lower valuation business than the hopes and dreams which you guys have mentioned, I've mentioned based on producing these wonderful AI agentic software products from Grok. And it's one of many head scratchers about this deal.

[Scarlet Fu]

At what point does financial reality, the kinds of things you were just talking about breaking down the numbers become more important and matter more than the storytelling, the hopes and dreams part of it. Because that's what Elon Musk excels at and that's what people are buying in on.

[Jim Chanos]

So the question is, is, does the Elon Premium, is it Elon Premium Times 2 or Elon Premium divided by 2. I think that that's, that's really the question here because the, there are people who believe in Elon and have bid up Tesla accordingly to well beyond where I think most fundamental analysts think it's worth because of Optimus robots and autonomous driving and all that good stuff. And now you have another Elon hopes and dreams company with an even bigger valuation. And so does that, does that double, double the value or does it basically say, okay, well I'm going to pick one? Because neither of them, let's face it, are being valued on their operations. Space X is, I believe, depending what I heard in the green room, is probably now at about 110 times revenues. And just history tells us you just never really make much money buying equities at over 100 times revenues.

[Scarlet Fu]

Yeah, well you, as we know, are inherently skeptical. Your company names Kinikos Skeptic. You're not being able to. On Space X or Tesla or Elon, Musk completely tracks. Is there anything in the Space X financials or Musk's management of the company that does impress you that you can say good job on?

[Jim Chanos]

Look, I think Starlink's a real business. We can look at their businesses again, we have to go on what's in the prospectus. Starlink's a real business. It's growing. It will probably continue to grow, although its growth is slowing. The launch business is still losing money after 22 years. And I'd be remiss from my fellow glass half empty participants if I didn't point out that the rocket that all of this depends upon, Starship, still has not achieved Earth orbit in 12 missions and half of those ended up with some sort of mishap. So there's a lot riding on all of that. I think Starlink is a real business. It's, it's worth a couple hundred billion dollars. But, but the real, the real hopes and dreams here is on xi, which is by the way, a company they bought in February for 250 billion in stock, that the market is now valuing at probably well over a trillion and a half dollars.

[Tom Keene]

On Bloomberg Television, on Bloomberg Radio worldwide with us, Jim Chano, thrilled he could join us today in this historic moment for his Wall street and all of us around the world. So the short crew is said Tesla, Tesla, Tesla, somewhat like Space X. And I'm enjoying a 53% per year return since sort of the beginning of COVID you know, back six years or so. So, you know, again, Tesla's done better than good and there's a Model negative free cash flow right now. How long can the optimus of Space X keep this going without delivering a more conventional income statement?

[Jim Chanos]

Well, I think you answered the question right. In years if, if possible. But, but Tesla is trading at about 14 times revenues, right. It does have 100 billion in revenues and it ramped revenues pretty quickly in 2019 and 2020. So, so there is a real business there in terms of large amounts of revenues and some cash flow. It's not trading at 110 times revenues and that's a magnitude of difference. I think that's really important for your viewers.

[Tom Keene]

I've got just for the first time Scott, I've ever looked the same BQ function.

[Scarlet Fu]

Yes.

[Tom Keene]

And the Bloomberg and of course chain else nails the price to sales because he studied Tom Galvin years ago. I've got 20. Well right now I've got out a number of 27 times revenue. And the BQ screen, it may be a little higher than that. I've never seen a stock like that.

[Scarlet Fu]

So that, I mean I'm glad you guys bring up Tesla because there is this expectation that Tesla and Space X will somehow merge or will be combined in the same way that X and Space X got combined and merged. How are you thinking through that? What does that mean for investors who believe in the Tesla business but are maybe skeptical of Space X?

[Jim Chanos]

Well again, if it happens, and I have no idea if it's it, if

[Scarlet Fu]

it will happen, does Elon need to make it happen?

[Jim Chanos]

No, he doesn't need to make it happen. He can keep himself if he wants. It's, it's, it's solely up to him. We all know that. But it would be an equity for equity deal and so I don't know how much value that would add in terms of cutting overhead is not the story here. Right. It's really, it's really what these companies will produce in the next five, 10 years.

[Tom Keene]

I look at this, Jim Chanos is an historic moment and the answer is cycles. And I opened up talking about Enron and all that. I want you to talk about the short business right now is a hugely important part of financial society. In this great bull market we're in right now, there's a lot of scars out there. How do you keep that going when you see Space X right now? How do you keep a short model going with both sectors and a bull trend in the broader market?

[Jim Chanos]

So through 2023 we're running outside money now. We run our own money. We've been hedged in the short world since 1996, basically our view has been we don't know where the market's going and nor does anybody else. So we'd rather be long the market and short our collection of radioactive companies, if you will. And that's been a very profitable, profitable business. And it's been a very profitable business for the last few years too, despite the market hitting new highs because there's been a lot of stocks, as you guys know, that have lagged dramatically. So our view is always be long the market and be short some percentage of, you know, companies, bad businesses. And I think that's nothing I would recommend your viewers to do at home. I don't, don't recommend short selling for, for most people it's really for the pros for lots of reasons, things like getting an interest rebate on your shorts and a variety of other things. But I will say that one of the things right now that is very apparent is that insurance is cheap and it's cheap for all the reasons.

[Tom Keene]

I don't want to interrupt because Scarlet, want to get four more questions in? Is Space X radioactive?

[Jim Chanos]

We'll have to see where it settles out. You can't short it right now anyways, so it's a moot question. I mean I think that that anything trading over 100 times revenues is of our interest. Historically returns have been awful at those valuations.

[Scarlet Fu]

You mentioned earlier the dot com bubble. Are we doing dot com bubble 2.0 right now?

[Jim Chanos]

Oh, this is much bigger. The AI, the build out relative to the TMT build out of 99, 2000 is multiples even as a percent of the economy GDP. And an important thing to point out is that when you get these capex booms in technology, they're tremendously accretive to earnings. And there's a simple accounting reason why that is when Tom buys chips for his data center from Nvidia, Nvidia recognizes that as revenue and profit. Tom capitalizes those expenses and writes them off over five to 10 years. And so you have a mismatch where the same dollar in a capex boom is recognized as profits by one entity and deferred by the same people expending the dollar. And that happened in 98, 99, 2000. From the middle of 98 S&P operating earnings rose 3, 30% to the middle of 2000 over two years from the middle of 2000 to the middle of 2001 when order books got pulled, S&P earnings dropped 40%.

[Tom Keene]

Was that too much accounting for Friday? I think so. I'll leave it.

[Jim Chanos]

I'll stop at that.

[Scarlet Fu]

Let me ask you one last question before we let you go because this is Bloomberg Money after all. How do you approach your own financial planning? How does it compare with how you advise or money manage money for others?

[Jim Chanos]

Well it's mostly in my business and ancillary things since I'm semi retired right now and I'm advising people not not directly running their money. So it's pretty conservative.

[Ed Ludlow]

But but so you set and forget

[Scarlet Fu]

or you do make a lot of changes.

[Jim Chanos]

It's mostly passive again for most people. I think that's the way to go.

[Tom Keene]

Jim, we got our merch over here. Scarlet's got her next jacket here ready to go. Let's go next are going to sit and Tony, why are we seeing you in the front row quickly here?

[Jim Chanos]

Well first of all I live in Buckle Bucks County, Tom, so I'm outside of Philly. So you're doing a 76 or 6 secondarily. My sons were born in Manhattan, are die hard Knicks fans, but I'm a Milwaukee Bucks fan. I'm a cheese.

[Tom Keene]

I was going to hear that for the record as well.

[Scarlet Fu]

Jim. Thank you so much for being here.

[Jim Chanos]

Thank you so much for having me.

[Tom Keene]

You're listening to Bloomberg Money. Stay with us with more to come after this.

[Yahir Anand]

With LPL Financial, we provide the services to help push you forward when it comes to your finances, your business, your future. The only question should be what if

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[Scarlet Fu]

Investing involves risk, including potential answer Principal

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[Public.com Representative]

for the show comes from Public. Public is an investing platform that offers access to stocks, options, bonds and crypto. And they've also integrated AI with tools that can assist investors in building customized portfolios. One of these tools is called Generated Assets. It allows you to turn your ideas into investable indexes. So let's say you're interested in something specific like biotech companies with high RD spend small cap stocks with improving operating margins or the S&P 500 minus high debt companies. Chances are there isn't an ETF that fits your exact criteria. But on Public you just type in a prompt and their AI screens thousands of stocks and builds a one of a kind index. You can even backtest it against the S&P 500. Then you can invest in a few clicks, go to public.com market and earn an uncapped 1% bonus when you transfer your portfolio. That's public.com market and paid for by Public Holdings Brokerage Services by Public Investing Member FINRA SIPC Advisory Services by Public Advisors SEC Registered Advisor crypto services by 0/ash sample prompts are for illustrative purposes only, not investment advice. All investing involves risk of loss. See complete [e-mail] disclosures Ryan Reynolds here

[Ryan Reynolds]

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[Scarlet Fu]

we want to stick with the stock of the hour, and that is Space X the Bloomberg Money team writing the following Space X IPO whips Musk fans into frenzy. The more the better. One investor told our reporters, quote, this feels like the appetizer you have to believe in Elon. I'm willing to overpay for it just to say I'm part of the thing. Bloomberg Money editor Nikki Waller joins us now to discuss. So this has become experiential. It's not just about it being part of your portfolio, it's just about being part of the experience. And being a Musk fanboy.

[Nikki Waller]

Yeah, it's part of the conversation, right? This is an IPO we're going to be talking about at cocktail hour. And, and this is a place for Elon Musk's fans to show just how much they believe in him and his vision.

[Scarlet Fu]

Is there a unified voice, retail voice on Space X? I mean, we quoted that person who said that they just need to get in there no matter what. But I wonder how much divergence there is within the voices out there.

[Nikki Waller]

There is no unified retail voice in Space X. I think one of the most interesting things about this, given who Elon Musk is and how strongly people feel about him, the sentiment, what people are talking about on Reddit, the places where people go to debate, it's really not about whether or not you like Elon. It's about is this a good investment or not, which is a little bit heartening right now, that it's not a culture war. It's actually a value conversation.

[Scarlet Fu]

What are the cases traders are saying are the, you know, to buy the IPO versus not buying the IPO especially for a retail investor.

[Nikki Waller]

I think for retail investors, there is the FOMO that we're talking about. You want to be in at the beginning, in on the ground floor. We saw a lot of people that we've talked to over the week who have sold other stocks to give themselves dry powder for this offering. On the other hand, there are people who are not bothered by not getting in at this stage and they'll get in a little later even if it is more expensive. And you know, they say, say they believe that, you know, a lot of these people are Tesla investors. They're going to hold and believe that this will turn up value for them

[Scarlet Fu]

or it will just end up in their portfolio because it's part of the S&P 500 after a year where the

[Nikki Waller]

great many of us. Yes. And a year from now it'll be in our target date funds and Elsewhere in the 401k if it performs as people hope.

[Scarlet Fu]

All right, Nikki Waller, thank you so much. Bloomberg Money editor Nikki Waller. She is the person behind our Bloomberg Money efforts here at Bloomberg.

[Tom Keene]

Building out each and every day. What we know is the news flow has been extraordinary. There's been things off the radar, but then things that hit home. The reports this week, the update on your Social Security, those older than you, their Social Security was sobering to say the least. We get lucky. Jacob Lew is a former U.S. treasury Secretary. His current shingle out of Columbia University is professor of interest international and Public Affairs. But far more than that, a heritage to Massachusetts politics, working for Tip O' Neill ages ago and the 1983 Greenspan Commission. So what were you a page 15 years old working what was it like working on the Greenspan solution to Social Security.

[Jack Lew]

Good to be with you, Tom and Scarlett. I was about 25 years old. It was was, you know, out of college, an early job and I worked on Social Security really from the beginning of the time. I worked for the speaker through 83. So like four years. And the days were very challenging. Now we think we live in the most partisan days ever. The Reagan O' Neill fights were pretty legendary. And the 1982 congressional campaign was fought out over Social Security in large part. Would you or would you not protect Social Security? We had leaders at the time who avoided poisoning all of the possible solutions as they went through their political battles. And the Greenspan Commission, Alan Greenspan played an important role but it was really a cover for a negotiation between Reagan and o' Neill to figure out what could they agree on. And there were back channel negotiations about what could we do on benefits? What could they do on revenues? And when it came to an end, it was a solution that here we are 50 years later talking about the fund running out. 50 years, a pretty good accomplishment.

[Tom Keene]

14 years. Let's go to the Brookings Institution right now and Jack Lew, front and center here. Obviously, through all his services as Secretary of the Treasury, Brookings lessons learned from Simpson Bowles. Eleven of the members said, yeah, let's do this, let's do this. Recommending that the federal government take dramatic action. That number was short of the super majority. It didn't get done. They missed the 14 votes. Is that where we're heading again, to another Simpson bowl? Or with the leadership of you, of Peter Orszag and others associated with, with the Republican Party, can we get it done so she can get a Social Security check?

[Jack Lew]

So look, the reality is, the trustees report that came out this week says that in 2032, Social Security will run short of paying the old age benefits fully. It'll be a 22% benefit cut if nothing happens. You look combined at the old age survivor and disability trust funds, it's only two more years. 2034, it runs short. Having the idea of a 20 to 25% cut in benefits is unacceptable. Most people retiring rely on Social Security for most of their household income. It may not be true in the world that we live in, but for the majority of people retiring, they cannot afford to give up 10 or 20% of their Social Security check. The challenge is how do you create a sense of urgency around this to deal with it so that you're not on the eve of the trust fund running out of money? Any solution that's really going to work requires some time to take effect. If you do things on the, on the benefit side, even in a, in a way that has a modest impact, long lead time is needed. If you do things on the revenue side the same, you can't just say, tomorrow we're going to close the gap. So it should be treated, treated as an issue for today, not an issue for 2032. You put this in terms of the kind of presidential calendar, it means that before the end of the first term of the next president, something has to be done. Now there's good work being done. There's a group at the Brookings Institution that put out a bipartisan proposal. It has a combination of tinkering with benefits and tinkering with revenues, doing things, things that are kind of on the model of the 1983 package. And it has an impressive number of former Republican and Democratic members of Congress endorsing it. I'm going to be speaking at a conference at Brookings at the end of the month, June 24, where these issues are going to be discussed. I give you a lot of credit for starting the conversation here now.

[Tom Keene]

It wasn't my idea. Scarlet said, I'm not getting a check. Get check. Lumineers.

[Scarlet Fu]

This is because as a generation expert or Gen X or I just naturally assumed growing up. Yes. That Social Security would be insolvent by the time that I would need to draw upon it, that it wasn't going to be there. It's kind of a Ponzi scheme where I pay into it and nothing's going to come back to me. I just made my peace with that and most members of my generation have to. Here's a really dumb question, Jack. Can't the government just print more money to put into Social Security to make the benefits whole?

[Jack Lew]

First on the, on the financing, it never runs out of money because there's payroll taxes coming in. On a current basis, it falls short and the estimate is 22% short. So I think it's unacceptable to have a 22% benefit cut, but it not being there is something of a misunderstanding. And I think the challenge is how do you drive the political process to talk about not having the unacceptable outcome of that across the board cut?

[Scarlet Fu]

Can the government just print more money to make it look.

[Tom Keene]

Oh, listen to you.

[LPL Financial Representative]

Oh.

[Scarlet Fu]

I mean, this is a question that's out there.

[Jack Lew]

We have issues that are fiscal challenges besides Social Security, we're running an enormous deficit. Our debt is growing. I was OMB Office of Management and Budget director for three years when we had a balanced budget and a surplus and we thought we were on a path towards paying back the debt. That's not where we are today. We're in a path where. Where we have to worry, will the world support our borrowing needs in years to come? Just printing money is adds to that process.

[Tom Keene]

I was going to say to this in a bit, but Scarlet's taken over the show. Let's get to it now. Our debt and our deficit. None of us have ever seen this. This is what I say in interviews, it's what I say in speeches. What do we do after Trump? What is the behavior pattern of our fiscal policy and fiscal dialogue after this President of the United States?

[Jack Lew]

I think this conversation about Social Security is going to be the first test. You know, it's the thing that's most pressing in terms of requiring immediate attention and frankly, on neither side of the aisle. Do you hear leaders talking about taking the kinds of responsible fiscal policy steps to put our whole house in order? Ultimately, it will require a combination of difficult decisions that, that our history is, are better taken on a bipartisan basis than not. That doesn't seem to be in the cards right now. I would say start with Social Security. Fix Social Security. Everybody wants Social Security to be there and build a little trust to move to the other conversations. What I worry about is, you know, the legacy of the Trump administration is leaving very little resources to meet urgent needs. The burden of paying the debt is growing as a percentage of the budget. So whether you care about national defense or feeding hungry children, it's going to be harder and harder to pay the bills. So these issues are going to have to be addressed. We have to, we have to start somewhere.

[Scarlet Fu]

You know, when we talk about the national deficit, the debt burden that's out there, a lot of people wonder how it connects to their finances, their livelihoods, their lived experience, electricity. Elected officials say you don't want to make it bigger and leave it to your kids and grandkids to shoulder that burden. But what does dealing with it actually look like? What kind of sacrifices would people need to accept making in order to reduce that deficit?

[Jack Lew]

Look, the things that are driving the federal deficit are we spend more than we collect in revenue. It's not more complicated than that. We spend about 23% of GDP. We raise 15 to 70% of GDP. Revenues when we balanced the budget were 21% of GDP. That's what Bowles Simpson looked at as a target. We're going to have to talk about taxes. We can't talk exclusively about taxes. If you fix Social Security in 1983, when we fix Social Security, it actually helped the overall fiscal health of the country. We didn't do it to balance the budget, but when you, when you make changes in, bring more revenue in, and even in a modest way, curtail spending, it helps. So I think there's going to have to be a conversation that's very hard on both sides.

[Tom Keene]

I've got, with the time running out here, Jack Lew, I've got like eight ways to go. I noticed Space X. We'll do it here in a moment, folks. Space X out to a new high right now. We'll get to that after Professor Lu, I want to go back to the core issue, and this is a Bloomberg issue and the fancy people we talked about to. I went back one of the, one of the greatest amount of hate mail I've ever gotten on a chart was explaining to people that the rich stop paying their fair share of Social Security ages ago is one of the linchpins of Social Security reform that the fancy people like me just simply have to put more in.

[Jack Lew]

The fact that we stopped paying Social Security payroll taxes when we keep on earning quite a lot of money. Beyond that is a relatively easy policy solution which won't dramatically affect the standard of living of people who are in a fragile place. I think it's a little unfair to say they don't pay, that people don't pay their fair share. We have a progressive benefit structure where your Social Security benefit is a higher percentage of your prior wages. Wages and a better return on your payroll taxes than if you're at the high end. I think that's a positive feature. That's a feature, not a bug. I mean, we have a system that does modest redistribution where everybody's in it together. You think about the things that in our society are poverty programs and how they fared in the last few years. Look at Medicaid cut deeply. Look at snap, the food stamps program cut deeply. There is no longer an AFTC program. It was replaced by tanf. So if you put things in the basket of poverty programs, they are much more vulnerable. I think to strengthen Social Security, we should all be in it together. And I think the right thing to do is to raise the earnings limit. But we also have to look at what you do on the, on the benefit side in some ways taking a long lead time, not doing anything dramatic.

[Tom Keene]

Wonderful to see you. Look forward to seeing you again. Jack Lew with us, folks. Of course, the former treasury secretary of the United States now at Columbia University. Coming up, it's become instantly popular books. I have a book, Scarlet as a Book. Elon has books.

[Scarlet Fu]

Well, Elon likes reading. There are lots of books about Elon as well. So we can go in any number

[Tom Keene]

of my favorite books out there. I'll give you a hint. Mr. Isaacson is on the Elon Musk.

[Scarlet Fu]

There you go.

[Tom Keene]

From New York City on this Friday, Bloomberg Money. Stay with us.

[Public.com Representative]

Support for the show comes from public. Public is an investing platform that offers access to stocks, options, bonds and crypto. And they've also integrated AI with tools that can assist investors in building customized portfolios. One of these tools is called generated assets. It allows you to turn your ideas into investable indexes. So let's say you're interested in something specific like biotech companies with high R and D spend, small cap stocks with improving operating margins or the S&P 500 minus high debt companies. Chances are there isn't an ETF that fits your exact criteria. But on Public you just type in a prompt and their AI screens thousands of stocks and builds a one of a kind index. You can even backtest it against the S&P 500. Then you can invest in a few clicks, go to public.com market and earn an uncapped 1% bonus when you transfer your portfolio. That's public.com market and paid for by Public Holdings Brokerage Services by Public Investing member FINRA SIPC Advisory Services by Public Advisors SEC Registered Advisor Crypto Services by Xerohash Sample prompts are for illustrative purposes only, not investment advice. All investing involves risk of loss. See complete [e-mail] disclosures Ryan Reynolds here

[Ryan Reynolds]

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[Tom Keene]

Welcome back Bloomberg Money from New York City. Scarlet Fu and Tom Keene. Somewhat of a special edition. Yes, personal finance. We're doing retirement, Social Security day and wealth management. I'm not out of triple leveraged on cash yet. I I have not gone long on Space X.

[Scarlet Fu]

You're not buying up the triple leveraged single stock SpaceX. All right, well, we'll see how that goes. But in the meantime, let's check in with Yahir Anand. She is our Bloomberg Television correspondent joining us from the Nasdaq to give us an update here on what's going on with Space X. Yahir hi Scarlett.

[Yahir Anand]

Well, we are seeing shares trading just under $165, well above their $135i pre open pricing, giving Space X a market value of just over $2 trillion. That strong debut though, isn't entirely surprising given the enormous demand we saw ahead of the offering from both the institutional side and retail investors. With the deal heavily oversubscribed and now we are hearing the first reports of technical issues. Robinhood putting out a post on X saying that Robinhood saw record breaking traffic today and as a result, some customers experienced latency and intermittent issues are saying that essential systems have now recovered. But as I said, not a surprise given that we knew that the retail demand for this stock was going to be huge.

[Scarlet Fu]

All right, Yahara, thank you so much, Johann over at the nasdaq. We will be checking in with you throughout the trading day.

[Tom Keene]

Tommy, clearance buttressed up here. Space X. I'm sorry, it lifts up, it churns a little bit, the tensions there, the sweats there. But on first blush, congratulations to these bankers for getting the price right. It's, it's an art. You know, it just doesn't happen with

[Scarlet Fu]

price is usually right on the first day of trading. It's a matter of whether the price is still right a week from now or two weeks from now or two months from now.

[Tom Keene]

Huge feedback last week to our book section. What we do today just to spare it down is to look at the books of the gentleman in the leather jacket at the New York Stock Exchange a bit ago. And that would be Elon Musk. I look at these. Scarlett, why don't you run through the three books we've got right now.

[Scarlet Fu]

It's a foundation series by Isaac, Isaac as in Asimov. And apparently this is the book that he put in the red sports car that he shot into space. So he wanted this to be noted for posterity.

[Tom Keene]

If you're, if you're of a certain vintage, you dream with Mr. Mr. Asimov.

[Scarlet Fu]

That's a science fiction series. That's what Luigi tells me. Our producer, the hit and his favorite book, by the way, the Hitchhiker's Guide to the Galaxy by Douglas Adams. This really has a lot about the formulating the right Questions. And we know that Elon Musk is a big thinker type. So I think he said that this had a great influence on him during middle school.

[Tom Keene]

And the third book I just think is so important, folks, and poignant here with the death of the gentleman from Brown University, Gordon S. Wood. Gordon Wood was our definitive biographer of Benjamin Franklin. He is the one that brought him to life. And then Walter Isaacson exploded Benjamin Franklin even more into our consciousness. You see, if there was the TV series that was out, it was so good was played.

[Scarlet Fu]

Benjamin Franklin.

[Tom Keene]

Do you know, I can't remember right now. You're the celebrity lodestar. You should.

[Scarlet Fu]

It's kind of a trick question, but

[Tom Keene]

the answer is it's a really important statement about America's first entrepreneur.

[Scarlet Fu]

I'd like the way you put that. Yes. Where Elon Musk appreciates the profile of Benjamin Franklin by Walter Isaacson. We know that Elon Musk admires Ben Franklin deeply for his journey from being an entrepreneur to being an inventor. And that's kind of how Elon Musk sees himself, along with, you know, all the other hats that he wears.

[Tom Keene]

Let us know here at Bloomberg Money your thoughts on books. I think one of the ways we go is just get five books from. Five books from Scarlet would be a good angle.

[Scarlet Fu]

Let's just do one a week. I don't know that I can read five at once.

[Tom Keene]

I know. Who says we have to read about. That's the way it is. I'm reading right now. Valley Nasser on Iran, Iran, Iran Nasr. Francine Lacroix introduced me to him. It is the 1 volume on Iran. Bloomberg Money. Good noon to you. Tom Keene, Scarlet Fu. Here is really a special edition shout out to our team for like talk about rip up the script. Blew it up.

[Scarlet Fu]

Yep.

[Tom Keene]

And I called up Elon, I said, can you make the training? Like, I'm thinking 18 minutes ahead of time. And he and his team, they nailed it. It's SpaceX.

[Scarlet Fu]

Pretty incredible.

[Tom Keene]

A new high right now. We're up 26% off that. You know, it's amazing. Lisa Mateo and her kids on the couch in Robin Hood and their trades got through the look ahead before she retires here this weekend. Bloomberg this weekend. Lisa Mateo, what do you got?

[Lisa Mateo]

The phone calls already. So I want to start out with what we're looking ahead to to next week. Middle east, of course, definitely in focus. You have President Trump saying that the US And Iran are possibly, possibly coming closer to a deal. You have sources telling, though. Yes. You have sources telling Bloomberg it could happen at the sidelines of the G7 summit. But now you have the prime minister of Pakistan coming out on social media and saying that the text they have agreed to it.

[Scarlet Fu]

They reached that outside confirmation.

[Lisa Mateo]

Exactly. He posted on social media and he's saying that you know what, we're going to keep talking with them and a deal could be reached. His quote saying peace has never been as close as it is now. So you look at the all oil, you look at Brent, you look at WTI crude, they're both down more than 3%. So that's something we're going to be focused on into the weekend.

[Tom Keene]

It's an important point to see Brent down 3%. I mean with the oscillations this week.

[Scarlet Fu]

Yeah, it absolutely has. And in fact oil prices are set to close the week lower if we continue along this path. There's also quite a bit of data coming out including on the consumer which is what we're all concerned about.

[Lisa Mateo]

Correct. Retail sales, we can't forget about that. And we also have the fomc meaning talking about interest rates. So there's a new Bloomberg survey out today that shows that economists are feeling that rates are going to stay steady throughout 2026. We'll see. The question though is what is Kevin was going to say it's his first, you know, press conference. So what exactly is he going to say? Bloomberg Intelligence says he's going to steer away from any kind of hinting or guidance as far as interest rates.

[Tom Keene]

But party at least this tomorrow night next we don't have to.

[Scarlet Fu]

We could stay up inviting yourself over to Lisa's place.

[Tom Keene]

Yeah. Party hit leases and we don't have to go to sleep.

[Scarlet Fu]

Tom doesn't care about the FOMC right now. What he cares about is the next watch party at your house over the weekend.

[Lisa Mateo]

Correct? I know but I can't stay up late because we have Bloomberg. That's a weekend torture weekend. So when things begin away but yes to the game Saturday. So you have to keep in mind for that. Here's the thing, if we do not win, and I don't want to put that out there but I know I'm not going to going to jinx it. But there's a number going out there and it's $263 million in economic activity. They're saying if it comes back to New York. So that's the big number that they're saying. But I say forget the big number. Let's just get it in five and we can celebrate at the parade.

[Scarlet Fu]

Yes, I like thinking. I like your line of thinking.

[Lisa Mateo]

Another big event. Can't Forget World Cup 2. Also happening today we have the US taking on Paraguay. That's tonight. And then this weekend, Saturday you have the games coming to the New York, New Jersey area. So that's going to be Brazil and Morocco. And that's taking place on Saturday.

[Tom Keene]

This is the Bloomberg Money Podcast bringing you a smart look. 3 2. This is the Bloomberg Money Podcast bringing you a smart look at the forces shaping your financial life. I'm Tom Keene with Scarlet Fu. You can watch the show live on Bloomberg TV every Friday at noon Wall street time. Subscribe to the podcast on Apple, Spotify or wherever you listen. And as always, on the Bloomberg Terminal and the Bloomberg Business app.

[Ryan Reynolds]

Ryan Reynolds here from IT Mobile. I don't know if you knew this, but anyone can get the same Premium Wireless for $15 a month plan that I've been enjoying. It's not just for celebrities. So do like I did and have one of your assistant's assistants switch you to Mint Mobile today. I'm told it's super easy to [e-mail]

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