Squawk Pod: AT&T CEO John Stankey & Treasury Sec. Bessent - 02/13/26 | Audio Only

Key Concepts

• Fiber Optics: The core infrastructure investment for AT&T, considered superior to satellite technology for comprehensive connectivity.
• AI Impact: The transformative effect of Artificial Intelligence on AT&T’s operations, strategy, and the broader telecommunications landscape.
• Capital Expenditure (Capex): AT&T’s significant investment in infrastructure, expected to peak and then decline as fiber deployment nears completion.
• Financial Crimes Enforcement Network (FinCEN) Whistleblower Program: A new initiative to combat fraud and abuse in government programs through incentivized reporting.
• Kevin Worsh’s Fed Confirmation: The ongoing political hurdles and investigations surrounding the nomination of Kevin Worsh to the Federal Reserve.
• US Economy & Inflation: Discussion of current economic conditions, inflation trends, and the impact of government policies.
• Deregulation & Tax Cuts: The Trump administration’s policies aimed at stimulating economic growth through deregulation and tax incentives.

Treasury Secretary Scott Bessant Interview

Secretary Bessant announced a new initiative by the Treasury’s Financial Crimes Enforcement Network (FinCEN) to incentivize whistleblowers to report fraud and abuse within government programs. The program will offer rewards of 10-30% of recovered fines, starting with a focus on cases like those seen in Minneapolis involving fraudulent daycare claims and inflated program participation numbers (e.g., 80% of children claimed to have autism). The website for reporting is fins.gov/whistleblower. He emphasized the importance of recovering stolen funds from American taxpayers.

Regarding the Kevin Worsh Fed confirmation hearing, Bessant stated the administration has no influence over the DC US Attorney’s investigation. He proposed a Senate Banking Committee investigation into the Fed’s construction project overrun, but confirmed the hearing will proceed despite Senator Tillis’s hold on a vote. He noted Senator Scott’s assessment of Fed Chair Powell as “incompetent” regarding the project’s mismanagement and highlighted the Fed’s ability to “print more money” to cover budget overruns, resulting in a $100 billion annual loss.

Bessant addressed concerns about the US economy, drawing a parallel to a “massive auto pileup” to describe the current economic uncertainty. He acknowledged the disconnect between positive economic indicators (like the recent jobs report) and public sentiment.

AT&T Chairman & CEO John Stany Interview

Stany emphasized AT&T’s strategic shift towards becoming a communications company focused on fiber optic infrastructure. He stated that a third of AT&T’s capital investment goes inside buildings (hospitals, stadiums, universities), a need satellites cannot fulfill. He aims to reach 60 million fiber connections by 2030, currently at 32 million, with an anticipated increase to 40 million by year-end, aided by the Lumen acquisition.

Stany dismissed the long-term viability of satellite technology as a universal solution, arguing fiber remains superior in many areas. He anticipates capital expenditure (Capex) will peak around 18.5-19% of revenue and then decline as fiber deployment nears completion, leading to increased cash flow generation.

He described the impact of AI as a “freight train” coming at every aspect of the business, requiring constant adaptation. He believes AI will disrupt all companies but can be a positive force if navigated correctly, improving operational efficiency and customer experience. He also highlighted the importance of favorable regulatory policy and tax incentives for continued investment.

Stany addressed employee concerns regarding a recent memo requiring employees to return to the office, stating it was a necessary step to maintain the momentum achieved through recent strategic changes. He defended the memo, stating it was intended to reinforce the importance of commitment to the company’s goals.

Economic Data & Statistics Mentioned

• Jobs Report: 30,000 jobs added, exceeding expectations, with unemployment at 4.3%. Private sector added over 170,000 jobs, while government jobs decreased by over 30,000.
• Minneapolis Fraud: Ongoing investigations into fraudulent claims in Minneapolis government programs, with escalating figures of stolen funds.
• Fed Losses: The Federal Reserve is losing $100 billion per year due to bond market purchases.
• Government Jobs Ratio: The ratio of government jobs to total jobs is at its lowest since 1966.
• AT&T Fiber Deployment: Current fiber coverage at 32 million locations, aiming for 40 million by year-end and 60 million by 2030.
• AT&T Capex: Currently at 18.5-19% of revenue, expected to decline to the mid-teens by 2030.
• Inflation (under Trump Admin): 2.7%
• Inflation (under Biden Admin): 21.5%
• Tax Refunds (early season): Up 22%
• GDP Growth (Trump Admin): 4.1%
• 2024 Deficit to GDP: 6.97%
• 2025 Deficit to GDP (projected): 5.4%

Notable Quotes

• John Stany: “I don't think universally you're going to ever beat fiber in many places.”
• Scott Bessant: “After you've been in a massive auto pileup, you're a little skittish about driving and Joe Biden crashed the economy.”
• Scott Bessant: “Senator Scott said J. Powell is guilty of one thing, incompetence.”
• John Stany: “AI is coming like a freight train.”
• John Stany: “After you get all the railroad tracks in, then you run the trains.”

Logical Connections

The interview with Secretary Bessant set the stage by highlighting government efforts to address financial fraud and the political complexities surrounding the Fed nomination. This transitioned into the interview with John Stany, focusing on AT&T’s strategic investments and its response to the evolving technological landscape, particularly the impact of AI. Both interviews underscored the importance of economic policy and infrastructure investment in driving growth and stability. The discussion of economic data and statistics throughout both segments reinforced the overall narrative of a dynamic and potentially volatile economic environment.

Synthesis/Conclusion

The interviews revealed a focus on infrastructure investment, technological adaptation, and economic recovery. Secretary Bessant emphasized accountability and fiscal responsibility, while Stany highlighted the importance of long-term strategic planning and investment in core infrastructure like fiber optics. Both leaders acknowledged the disruptive potential of AI and the need for proactive adaptation. The overall takeaway is that navigating the current economic landscape requires a combination of sound fiscal policy, strategic investment in future-proof technologies, and a willingness to adapt to rapidly changing conditions.