The Trump administration had a clear message to the thousands of financiers and investors gathered in Beverly Hills this week for their annual pilgrimage to the Milken Institute’s conference: keep calm, we have a plan.
Between private drinks, a dinner for some of the world’s biggest money managers at a swanky Los Angeles restaurant, and the main ballroom at the conference, US Treasury secretary Scott Bessent tried to hammer home to investors that the president and his team had a playbook to jump-start growth and strike new deals with the country’s most important trading partners.
The full-court press by Bessent underscored the Trump administration’s push to assuage the world’s biggest investors, who earlier this year blanched when new tariffs were unleashed, triggering a massive market sell-off after which the White House reversed course.
Keeping the titans of Wall Street on side is critical as Donald Trump looks to execute his trade agenda. A significant sell-off would reduce the administration’s ability to play hard ball with China and other major trading partners. Those negotiations will begin imminently, with Bessent due to fly to Geneva on Thursday to start trade talks with Chinese officials.
“Scott Bessent is here to tell everyone that everything is fine,” Mathieu Chabran, the co-founder of private investment group Tikehau Capital said. “He is aware that there are outflows and foreign investors are not rolling like they used to.”
The reception over the past week has not always been warm. Bessent outlined the administration’s plans at a private dinner at Wolfgang Puck’s Spago restaurant in downtown Beverly Hills on Sunday, where he was joined by former Treasury secretary Steven Mnuchin, according to three people who attended the event.
Attendees were taken aback when Mnuchin interrupted an investor warning they might pull back from the US if the tariff plans went fully into effect, people familiar with the matter said. Mnuchin fired back: where else could they invest with the same opportunities?
The takeaway, the head of an infrastructure investment firm said, was “grow up” and that “the Trump administration wasn’t here to bail out investors”.
The Treasury declined to comment, while Mnuchin did not respond to a request for comment.
Blocks away at the Peninsula hotel the following evening, a conversation between Trump’s former trade representative Robert Lighthizer and attendees including Bill Ackman became heated, according to multiple people familiar with the exchange.
Over a dinner hosted by Citigroup chief executive Jane Fraser — on which the bank declined to comment — Lighthizer was pushed on the rollout of the tariffs and how the levies could torpedo the economy and markets. Having missed out on a cabinet role, Lighthizer is now a senior adviser to Citi on trade.
Large investment houses are already grappling with a more tenuous relationship with the White House than in the first Trump administration. The heart of the administration lacks senior finance executives who are well known by investors, like Gary Cohn and Mnuchin of Goldman Sachs, who previously served under Trump. Wall Street’s elite firms sense they do not have the same influence and connection they once did.
That has heightened the attention directed at Bessent, a former hedge fund manager, as investors look to him for signs that tariffs will not be as damaging to the economy as first envisaged. In private sessions, financiers pitched the case that the levies — and the way they were rolled out in Trump’s so-called “liberation day” announcement — would hit consumers hard, trigger a recession, and knock the dollar and Treasuries.
Bessent and his team are keenly aware of the effect a market sell-off can have on public opinion of the Trump White House, as well as how that market carnage might hamper the country’s negotiating posture in trade negotiations.
“No question, Bessent is looking to calm markets right now,” Ted Koenig, the chief executive of private credit lender Monroe Capital, said. “He said a lot of good things, but there were no specifics.”
“People were excited to have [Bessent] out here,” the head of a large hedge fund said. “But I don’t know if they came out knowing anything new. There wasn’t an ‘aha’ moment for anyone.”
The friction evident behind closed doors was less visible in public. Bessent stuck to the script as he headlined a discussion with Milken himself. The audience in the packed ballroom was silent as Bessent laid out the Trump administration’s plans for a “golden age economy”, hanging on any utterance that might shed new light on where the US president stood on his tariff policy.
“Tariffs are engineered to encourage companies like yours to invest directly in the United States,” he said. “Hire your workers here, [build] your factories here, make your products here. You’ll be glad you did, not only because we have the most productive workforce in the world, but because we will soon have the most favourable tax and regulatory environment as well.”
In private dinners and meetings, several buyout executives hit out at the administration’s approach to trade policy, warning it would hamstring American businesses and fail to deliver on its deficit-reduction targets. In public, however, few would criticise the president, fearful of retribution.
“This is the most self-censored Milken conference I have ever been to,” one asset management executive said.
Despite a conference that was overflowing from the confines of the Beverly Hilton — with Blackstone and Goldman both taking over full floors of the Waldorf Astoria next door — the mood on the ground was decidedly chilly. Several asset managers pointed to the fact there was one delegation missing altogether from the conference: large investors from China.
“It has an unsettled quality to it. People are steeling themselves in a tentative way,” said the founder of a credit investment firm. “Last year the mood was go, baby, go. There’s no go, baby, go this year.”
A senior partner at a European buyout shop added that executives across the industry were “resigned” and knew they were “entering the twilight zone . . . the Golden Age is behind us.”
Last year dealmakers were wagering that a boom in mergers and initial public offerings loomed, offering the private equity industry its first substantial window to exit investments it had been sitting on for years.
That euphoria was magnified by Trump’s sweep of the White House and a rally in markets that saw stocks hit record highs. But it all began to unravel as this year’s trade war swung into view and investors came to realise how they had misjudged Trump’s agenda.
“People got optimistic about Trump and the whole American exceptionalism thing early and it’s gone,” the chief executive of one private equity firm said. “It’s still bleak — you’re more depressed when you get a little hope and it goes away.”
