(Bloomberg) -- Lloyd Blankfein still gets up in the middle of the night to check the markets. It’s a habit he developed over four decades at Goldman Sachs Group Inc., first as a precious-metals trader and, eventually, as chairman and chief executive officer of Wall Street’s most storied firm.

Except Blankfein left Goldman in 2018. Today, he’s 67, retired and, truth be told, not doing much. The “gap year” he thought he was taking has turned into three.

“Somehow, I’m not scheduled,” Blankfein said in a Bloomberg “Front Row” interview at his New York apartment overlooking Central Park, his deadpan self-deprecating humor on full display. “I don’t set my clock most mornings.”

He spends his time on philanthropy, indulging a passion for history, staying fit by swimming and, yes, trading. By his own admission, Blankfein, a billionaire, trades “a lot” -- multiple times a day, buying and selling stocks and commodities, and occasionally currencies.

This isn’t the way things used to go for Goldman leaders. Blankfein’s four predecessors went on to powerful roles in government. Hank Paulson and Bob Rubin became Treasury secretaries. Jon Corzine was elected New Jersey’s governor and later a U.S. senator. Rubin and Steve Friedman advised presidents as directors of the National Economic Council.

Before them, John Whitehead, Goldman’s patrician boss of the 1970s and 80s, was deputy secretary of state and chairman of the Federal Reserve Bank of New York. He then oversaw reconstruction of Lower Manhattan after the Sept. 11, 2001, terrorist attacks.

So many Goldman alumni have entered public service that the firm acquired the not-so-complimentary sobriquet Government Sachs. Blankfein, too, would love to serve as Treasury secretary.

“Who, offered that job, would decline that?” he said. “You’d have to be preparing for your end of life or jumping off a cliff or something like that. Of course, to make that kind of a contribution, to be at that fulcrum of that very large lever, of course you’d want to do it.”

But he hasn’t been asked.

Since the financial crisis 13 years ago, Democrats have mostly snubbed the Goldman talent they once welcomed. Securities and Exchange Commission Chairman Gary Gensler, who left the firm in 1997, is the only Goldman veteran with a prominent role in President Joe Biden’s administration.

Blankfein, a lifelong Democrat who grew up in New York public housing, describes Washington as a “charged environment” and has grudgingly accepted that his chances of going there are slim. For a while, he toyed with the idea of being a paid consultant but ultimately decided he didn’t want to “get on a horse with a sample case and try to build that business.”

Trading is different. It comes easily, and he doesn’t mind the reflexive urges to check prices.

“Those are habits that don’t die easily, and I’m not sure I want them to,” Blankfein said. “It’s fun.”

Inflation and Risks

Even in retirement, Blankfein is preoccupied with the questions that bedevil policy makers and his former colleagues on Wall Street. 

In the debate over supply-chain stresses and how quickly to raise interest rates, he sides with Federal Reserve Chair Jerome Powell. But, having lived through the 1994 bond-market rout, he also appreciates why banking CEOs are growing alarmed at the rising cost of goods and labor.

“If you had to err on one side or another, you would err on allowing a certain amount of inflation to take place and not want to get yourself into a deflationary -- see Japan for 25 years as a reference,” Blankfein said. “I respect the Fed for standing up to a lot of pressure.”

What concerns him more is what happens when rates inevitably do revert to historical norms and investors suffer the consequences of piling into risky securities. The losses “will break people’s hearts,” he said.

Blankfein also sees pitfalls in the digitization of finance. The growing potential for “a mistake or a flawed program that sells all your assets for a quarter of the value, and you can’t pull it back,” is something he said he’d be worried about if he were still overseeing trillions of dollars, not just his personal accounts.

Some Regrets

Throughout the pandemic, Blankfein has mostly been in the Hamptons or Miami Beach. That routine is a night-and-day difference from when he ran Goldman, and he admits he misses the camaraderie, the intensity and the anxiety of “having things to fret about all the time.”

He also has a few regrets. Blankfein wishes he’d expanded money management for the uber-wealthy at a faster clip, given the boom in demand for those services. And “with the benefit of hindsight,” he said he might have bid more aggressively for Barclays Global Investors, the exchange-traded fund business that BlackRock Inc. acquired in 2009 for $12.5 billion and has since turned into an industry behemoth.

Goldman hasn’t suffered. The New York-based firm has already earned more -- almost $18 billion -- through the first nine months of 2021 than in any of its 152 years. The stock has surged to a record.

Blankfein resolved upon leaving not to meddle in Goldman’s affairs or to comment on the performance of his successor, CEO David Solomon. If there’s any lingering tension, he masks it with humor.

“I have a rubber telephone that I bought for my grandchild that’s connected to nothing, and that’s the one I talk to and give advice to,” he said.

That’s not to suggest Blankfein is reticent. He has plenty to say about Wall Street’s big issues of the moment:

  • On the future of New York City: “Anybody who writes off New York is crazy.”
  • On returning to work: “I’m in favor of leaning on people to get back into the office.”
  • On Senator Bernie Sanders: “I wouldn’t be looking to put more of the economy in government control.”
  • On compensation for junior bankers who complained about working too hard: “If you want the talent, you have to pay for it.”
  • On the power of Big Tech: “I’d always thought that the tech industry was in some ways like financial services on steroids.”
  • On cryptocurrencies: “This may be one of the thousand things that I never in a million years thought would work, and it may work.”

Blankfein doesn’t yet own any crypto and grouped himself in with the “old fogies” waiting for regulation before deciding whether to invest. He also hasn’t tried commission-free trading on Robinhood Markets, sending all his orders to Goldman instead.

He wryly describes his performance as a day trader as “brilliant,” crediting winning bets on the so-called new economy -- companies using innovation to disrupt old business models -- and to monetary policies that lifted all boats.

“Everybody who started in the markets at the beginning of ’19 is a genius,” Blankfein said. “Zero interest rates make asset prices go up.”

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