The Inflation Blame Game

Citadel CEO Ken Griffin isn't pulling punches when it comes to inflation. Speaking at the Conference de Paris on Tuesday, the billionaire hedge fund manager told Bloomberg's Dani Burger that while President Donald Trump undoubtedly inherited an economy wrestling with inflation, some of his own policies have made the problem worse.

The culprits? Griffin pointed squarely at Trump's tariff policies and his immigration crackdown as the primary drivers of what he called "sticky" inflation. The immigration enforcement, in particular, is "curtailing" the labor market, which doesn't help when you're trying to cool down prices.

Griffin also noted something interesting: Democrats have essentially "rebranded" inflation—the very issue Trump campaigned on and won with in 2024—as an "affordability" problem. Same pain, different messaging.

Deregulation: The Slow-Burn Solution

Here's where it gets nuanced. Griffin believes the president and Republicans are "getting the message" about these concerns and scrambling for solutions. But he's not convinced the Supreme Court can strike down Trump's tariffs, even if they wanted to.

On the flip side, Griffin sees promise in Trump's deregulation efforts. He thinks rolling back regulations could unleash "productivity gains" that would give inflation a "healthy" reduction. The catch? It's what he called a "timing issue." These benefits take longer to materialize than the immediate inflationary hit from tariffs.

The Fed Fight Continues

This isn't Griffin's first public disagreement with Trump's economic approach. He's previously warned that Trump's public pressure on the Federal Reserve risks undermining its independence and damaging U.S. economic credibility—potentially leading to higher inflation and interest rates. Trump, characteristically, dismissed the criticism, saying he's more concerned with addressing what he views as incompetence than protecting the Fed's independence.

In a recent interview, Trump even expressed uncertainty about whether his economic policies would influence voters in the 2026 midterms, given the delayed effects. That adds another layer of complexity to the GOP's economic strategy heading into the next election cycle.

What The Numbers Say

Meanwhile, the actual economic data presents a mixed picture. The U.S. trade deficit narrowed to $52.8 billion in September—the smallest since June 2020—coming in well below expectations and improving sharply from August. U.S. job openings rose to a five-month high in October, led by healthcare and retail, though slower hiring suggested a cooling labor market.

For September, Core PCE—the inflation metric the Fed actually tracks—cooled from 2.9% to 2.8%, just below the 2.9% expectations. Not dramatic movement, but heading in the right direction.

Interestingly, ARK Invest CEO Cathie Wood has previously argued that AI-driven productivity gains could drive U.S. inflation to zero or below while boosting real GDP growth to 5%–7% annually in the coming years. That's a considerably more optimistic vision than Griffin's cautious "timing issue" framing, but both agree that productivity is where the real magic happens.