As eBay’s Meg Whitman becomes co-chair of Sen. John McCain’s national campaign, she talks to our Lesley Stahl about retiring from the business world and about her future. The following is part VII of a VII-part, exclusive interview that took place on Tuesday, March 11. To read the entire interview, click the links at the end of the article.
MEG: Oh, you will appreciate this. Over the last 10 years, households, as it turns out, do not run themselves.
MEG: And every married couple knows that. Everyone who runs a household knows that households do not run themselves. And in many ways my husband has run the house for the last 10 years. And he would appreciate a great deal of help in sort of turning that over. I’ll tell you a funny story. I came down to breakfast the other day. There was a to-do list for me.
LESLEY: Oh, come on. From him?
MEG: From him.
LESLEY: But your boys are gone, right? They’re out of the –
MEG: The boys are gone, yes. They’re gone.
LESLEY: What do you have to do to run the household when it’s just two of you?
MEG: You know, you … households … the dry cleaners, the grocery stores, who’s going to … you know, the dishwasher broke. We live in a house that’s about seven years old and the dishwasher broke. Well, someone actually has to call the dishwasher repairman to come fix the dishwasher. It’s about, you know … my son is going to Ireland on a rugby trip and he needed some Euros. So someone has to get the Euros for the freshman in college to take to Ireland.
So there are a million details that have to get managed in a house. And he has done most of them and I will take some of that burden for the foreseeable future. Because it’s the right thing to do and I think Griff is having quite a nice time pushing things to me.
LESLEY: I love that. Let me ask you just two more questions. One is about the economy, which seems to be in free fall at the moment. The markets, the sense of recession, the dollar is falling, people are being laid off, quite dramatically off, in every kind of industry you can think of. First off, what do you think of the economy? And secondly, maybe some advice. Where would you put your money at a time like this? What are you doing? And talk to our audience. Tell them what you think they should be doing.
MEG: Well, I am worried about the economy, Lesley, for exactly the reasons that you described. You know, you have this subprime mortgage crisis, which has a ripple effect on the economy, because if someone in your neighborhood loses their house – it turns out that most houses that are sold because someone defaults on the mortgage are actually sold for about 40 percent of the mortgage. So it’s a big value destruction when someone cannot pay their mortgage. And that has a ripple effect because then that house comes back online in your neighborhood, which reduces housing prices.
And I’m very concerned about what housing prices are going to do over the next year to 18 months. And I’m also worried, honestly, about the financial markets that you described, which is the pressure on the NASDAQ, the pressure on the New York Stock Exchange, the pressure on the stock price of companies, because of the liquidity crisis, because of the credit crisis.
And I think it’s excellent that the Bush administration has stepped in. I guess the Fed cut rates again this morning, and that’s the right thing to do, no question about it. The stimulus package, the rate cut, and the government may need to do more here, depending on what happens. And I think the government is doing some very good things in terms of working with lenders, working with borrowers to – if you want to stay in your house, there probably is a way to stay in your house, if you work with your lender.
So, where would I have money right now? I think it’s not a bad strategy to have a fair amount of money in cash right now, and be looking for opportunities to invest. But I would be sitting on the sidelines for a bit right now, and thinking hard about when it would be the right time to get back in, in a modest way. And I think what is so true, and what financial planners tell everyone, whether you have a thousand dollars in savings or much more, is diversification. Don’t put all your eggs in one basket – in one stock, in one type of stock, in bonds. Diversify as best you can. And that has proven, over many, many years, to be the most prudent way to invest. You may not get the highest annual returns, but you won’t lose money. And you will make money over time in a consistent sort of way.
So my message to the readers of your website is to sit on the sidelines. But if you get in, make sure you have a diversified portfolio of assets, as best that you can.
LESLEY: Yeah. Good advice. Final question. As we already said, the boys – your two sons – are how old now?
MEG: 22 and 19.
LESLEY: 22 and 19. They’re not really at home any more. They’re off to college or starting their career. And it’s just you and Griff. And I remember, in my own case, when my daughter left. My husband and I looked at each other and said, “Well, what do we like to do that isn’t really determined by our daughter? What do we really love to do?” So have you figured that out? What do the two of you like to do just for fun?
MEG: We actually really like to hike. And it’s something that we do together, and locally. One of the great things about living in California is the state parks, all up and down the coast. So we do a fair amount of hiking together. This was a fun thing we did about a month ago. We went down to see the elephant seals at Año Nuevo. I have lived in California for nearly 20 years and I’ve never been to see the elephant seals. And we had a ball. We drove to Half Moon Bay, drove down the coast, had a picnic lunch, went to see the elephant seals, on the most spectacular California day that you have ever seen. And then took off to a hike in the redwoods that’s just north of … or just a little bit south of Half Moon Bay, and did about a 10-mile hike, which I was dying at the end of.
LESLEY: What do you two do in the car? Do you listen to a book on tape? Do you finally sit and talk to each other? Do you take a little nap?
MEG: We talk. I like to drive because I get carsick if I’m in the passenger’s seat. And so I like to drive and we talk and then my husband will read a little bit. And then he naps, I think, as I recall, on the way back from the elephant seals.
LESLEY: Do you sing?
MEG: No, but we do listen to music.
LESLEY: Well, Meg, this has been informative. It’s been so interesting. It’s been delightful. And we can’t thank you enough and we hope we can invite you to come back.
MEG: Well, I am delighted. Thanks for asking, Lesley. And I hope we can get together in person in the near future.