September 29, 2022
Terrence A. Duffy
CEO, Chicago Mercantile Exchange Group
Group Publisher and Executive Editor, Crain’s Chicago Business
Against the backdrop of inflation and a possible recession, America’s businesses are continuing to lead, innovate, and adapt to the “new normal.” In Chicago, efforts throughout industries are strong as companies invest in the community and contribute to local, national, and global economies.
In the closing keynote of the U.S. Chamber of Commerce’s State of American Business: Chicago event, Jim Kirk, Group Publisher and Executive Editor of Crain’s Chicago Business, and Terrence "Terry" Duffy, Chairman and CEO of CME Group, discussed Duffy’s career and perspective on American business in action in Chicago.
There Are Four Main Factors Impacting Investors in Late 2022
According to Duffy, there are over 100 factors impacting investors today. He shared his views on four specific factors: international markets, inflation, uneducated investors, and mistakes from the Federal Reserve.
“It's not just if the United States catches a cold, the rest of the world gets sick,” Duffy explained. “It happens to other countries and comes towards us now. It's a completely different model than we're all used to.”
“When you look at what went on during the pandemic, gaming accelerated, trading accelerated, the gamification of these things all accelerated,” he continued. “Those are not good because those are uneducated participants losing the $2 trillion that the government just gave them to survive through a pandemic.”
Has the Federal Reserve Made a Mistake?
Duffy has been on the record on many national TV shows over the years, saying the Federal Reserve has a great opportunity to raise interest rates earlier to a certain level. From his perspective, “the Fed made a catastrophic mistake.”
“The Fed should have acted prudently and not acted politically,” he stated. “I heard something in Washington a long, long time ago … ‘Bad policy is good politics.’ I think that the Federal Reserve has been politicized to keep cheap money for growth that we probably shouldn't have had — and now the day of reckoning is coming.”
The Russia-Ukraine War Will Have Lasting Impacts on the Global Economy
Russia’s February 2022 invasion of Ukraine sent global shockwaves that displaced millions, shattered supply chains, and shifted the business relationships between many countries. Duffy believes the Russo-Ukrainian War will continue to have lasting effects on economies’ plans moving forward.
“I think there's a lot of flags planted in a lot of countries trying to [pursue] protectionist type of opportunities for their own governments — and they have no choice,” said Duffy. “They have to do that for their people.”
“That might be going back to the ‘bad policy, good politics’ type of situation, but you [have to] assure your people you care,” he continued. “So I think we're gonna see a lot more protectionism in less global markets over the next couple of years.”
How Private Companies Can Work With Washington
Duffy spent several minutes on the topic of working with Washington, D.C., as a private company to achieve mutually-beneficial results.
“I'm a big believer in the process of Washington. I like the process, I love this country, and … all in all, I think it's an amazing place,” Duffy said. “The problem is I think we've gotten people in there that are not qualified for the job.”
Duffy also noted that he is a “massive believer” in working with the government on shaping regulation, adding that it’s ultimately good for business.
“If you let Washington craft your regulation for you, you won't be in business very long,” he said. “But if you work with them over a long projected period of time and help shape it, then you could have good, smart regulation that is a global regulator.”
From the Series