{"id":159561,"date":"2025-11-29T11:30:18","date_gmt":"2025-11-29T11:30:18","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/159561\/"},"modified":"2025-11-29T11:30:18","modified_gmt":"2025-11-29T11:30:18","slug":"warning-over-private-equitys-push-into-401ks","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/159561\/","title":{"rendered":"Warning over private equity\u2019s push into 401ks"},"content":{"rendered":"

This article is an on-site version of our FirstFT newsletter. Subscribers can sign up to our Asia<\/a>, Europe\/Africa<\/a> or Americas<\/a> edition to get the newsletter delivered every weekday morning. Explore all of our newsletters here<\/a><\/p>\n

Good morning and welcome back. In today\u2019s newsletter:<\/p>\n

Private equity executive warns of US pension scheme push risks <\/p>\n

OpenAI partners in debt spree to fund ChatGPT maker\u2019s ambitions<\/p>\n

How the housing crisis is pushing Gen Z into taking risky bets<\/p>\n

And the worst office blunders remembered <\/p>\n

We start with a warning from Robert Morris, founder of US private equity group Olympus Partners, who has told investors that \u201cthe 401k scheme bodes to be the successor to the 2008 mortgage crisis\u201d in a letter seen by the Financial Times, raising questions about the industry\u2019s rush towards retail investors.<\/p>\n

More on the warning: Morris also said that \u201cthe multiple layers of fees\u201d in private equity funds designed for retirees\u2019 401k savings accounts meant their \u201cprojected rate of return is unlikely to exceed that of an equity index fund\u201d and noted that the funds exposed savers to \u201cample dollops of additional risk\u201d, in the letter that was sent to large endowments and sovereign wealth funds investing with Olympus earlier this month.<\/p>\n

Why it matters: Some of private equity\u2019s biggest names, including Apollo, Blackstone and KKR, have seen the 90mn US savers with 401k retirement plans as a growth opportunity. President Donald Trump signed an executive order this summer intended to accelerate the push of such funds into 401k savings accounts. \u201cThe marketing machines of the large asset managers have responded rapidly to the chum in the water,\u201d Morris wrote. Read more of the letter<\/a>. <\/p>\n

Here\u2019s what else we\u2019re keeping tabs on today and over the weekend:<\/p>\n

Economic data: Statistics Canada is set to release third-quarter GDP data. The government in Ottawa will also release budget balance figures for September.<\/p>\n

Companies: Brazil\u2019s state-run Petrobras oil company is set to hold a press conference to present its new investment plan for 2026-2030.<\/p>\n

Black Friday: Bargain hunters are expected to flock to stores in record numbers today and over the weekend but spend less money<\/a> as the crucial winter holiday shopping season begins.<\/p>\n

Opec+: Representatives from member countries meet on Sunday to decide on further oil production adjustments.<\/p>\n

Pope Leo is making the first foreign trip of his papacy to which region? Take this week\u2019s news quiz<\/a>.<\/p>\n

Five more top stories<\/p>\n

1. Trading in futures and options on the CME, the world\u2019s largest derivatives exchange, was halted for several hours this morning following a fault at a data centre. CME Group said it was working to fix the issue \u201cin the near term\u201d, without giving further details. Here\u2019s what we currently know<\/a> about the disruption.<\/p>\n

2. Donald Trump has threatened a sweeping immigration crackdown, saying he would \u201cpermanently pause migration\u201d from a swath of countries and \u201cterminate\u201d millions of admissions to the US. He made the comments as it was confirmed that National Guard member, 20-year-old Sarah Beckstrom, died from injuries<\/a> sustained in an attack by a suspected Afghan national.<\/p>\n

3. OpenAI\u2019s data centre partners are on course to amass almost $100bn in borrowing tied to the lossmaking start-up, as the ChatGPT maker benefits from a debt-fuelled spending spree without taking on financial risks itself<\/a>. Asset manager Janus Henderson estimates that the bonds, bank loans and private credit deals tied to OpenAI are equivalent to the net debt directly held by the six largest corporate borrowers in the world.<\/p>\n

4. Canada\u2019s Prime Minister Mark Carney has struck a deal for a new pipeline carrying 1mn barrels of oil a day to Canada\u2019s west coast in an attempt to pivot away from an over-reliance on the US economy. The memorandum of understanding lays the groundwork for a 1,100km pipeline project connecting its northern oil sands region to the coast. Here\u2019s more on the project<\/a>. <\/p>\n

5. Venezuela has revoked operating rights for six major airlines, accusing them of \u201cacts of state terrorism promoted by the US\u201d following a military build-up in the region by American forces. On Wednesday, during a visit by US defence secretary Pete Hegseth, the Dominican Republic authorised Washington to operate in restricted areas<\/a> within its San Isidro Air Base and Las Am\u00e9ricas airport outside Santo Domingo, the capital.<\/p>\n

The Big Read\"Montage\u00a9 FT montage\/Getty Images<\/p>\n

After turning into the world\u2019s factory, China\u2019s relentless efforts in research and development gave way to it becoming the world\u2019s laboratory. This prowess has allowed it to compete with, and potentially beat, the west. Find out how Beijing is working to win the innovation race<\/a>.<\/p>\n

We\u2019re also reading\u2009.\u2009.\u2009.\u2009<\/p>\n

Winning the \u2018Taco\u2019 trade: Gillian Tett identifies three broader lessons<\/a> from Brazil\u2019s handling of the White House and its tariffs policy.<\/p>\n

South Africa: Accused of trafficking recruits to fight for Russia, Duduzile Zuma-Sambudla, Jacob Zuma\u2019s daughter, is emerging as the heir apparent<\/a> of one of the country\u2019s most powerful political dynasties.<\/p>\n

The Wolf-Krugman Exchange \ud83c\udfa7: Martin Wolf and Paul Krugman return for a second season of their popular podcast series<\/a>. In part one they dive into Donald Trump\u2019s \u2018vibecession\u2019.<\/p>\n

Investing: Stuart Kirk explains<\/a> why he sold his entire equity portfolio and turned it into cash \u2014 flying in the face of years of advice he has given to clients and students.<\/p>\n

Chart of the day<\/p>\n

New evidence suggests that the unattainability of home ownership among Gen Z is prompting young people to resort to financial nihilism<\/a>, writes John Burn-Murdoch. <\/p>\n

<\/p>\n

Some content could not load. Check your internet connection or browser settings.<\/p>\n

\"\"\/<\/a>Take a break from the news\u2009.\u2009. .<\/p>\n

Few work mistakes compare with leaking a Budget, but many employees can relate to this week\u2019s slip-up at the UK\u2019s Office for Budget Responsibility. Emma Jacobs recalls some other memorable workplace blunders<\/a> and below the story readers weigh in with their own mea culpas.<\/p>\n

\"Montage\u00a9 FT montage\/Dreamstime<\/p>\n","protected":false},"excerpt":{"rendered":"This article is an on-site version of our FirstFT newsletter. Subscribers can sign up to our Asia, Europe\/Africa…\n","protected":false},"author":2,"featured_media":159562,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[138,246,111,139,69,244,245],"class_list":{"0":"post-159561","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-finance","10":"tag-new-zealand","11":"tag-newzealand","12":"tag-nz","13":"tag-personal-finance","14":"tag-personalfinance"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/159561","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=159561"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/159561\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/159562"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=159561"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=159561"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=159561"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}