we have our interview with ceo of blackstone, steve schwarzman.awrence kudlow, to replace the gary cohn. he is seen as a trump team player. ♪ betty: what a day, another day for the markets where we had again a day of declines. retail sales were setting the tone for investors, saying perhaps consumer spending is shaky, and this economic recovery we have been in so long might be shaky as well. i want to point out breaking news we had a few moments ago that might add bullish sentiment, the senate rolling back portions of the dodd-frank law, listing burdens for financial institutions, including smaller banks. that could be a lift for the markets tomorrow. yvonne: certainly deregulation has been simmering beneath trade concerns. larry kudlow will be interesting replacing gary cohn. he has been the trade hawk concerning china. asia -- china. -- weighd be way down ed down. betty: let's check how the markets closed a few hours ago in the u.s. the retail sales report setting the tone, declines in the s&p, down 0.5%. the dow off by 250 points. 0.2 percent.s

david: blackstone group chairman and ceo steve schwarzman understands both sides of the u.s.as the international investor, and, as an advisor to president trump. in an exclusive interview with betty liu, he put the debate into perspective. >> there's no doubt that there is a serious imbalance between the u.s. and china in terms of market access and tariff levels and nontariff barriers. part of this happens in the natural course of things. when you are a less-developed country, you have higher tariff laws. but we did that in the united dates in the 19th century -- the united states in the 19 century, and it helped build the united states behind the protection of those restrictions. the issue now is that, with china having such a large economy, even though per capita big, as one would think, but in terms of aggregate size, it is the second biggest in the world and it is growing at double the rate of any developed economy -- it is sort of time to make that change, to make best transition. best to make that transition. i think that the senior people understand that, because it is

alix: let's backtrack to steve schwarzman. that big of a great year in 2017, only making $786.5 million. whatever. jason: it is amazing, i was talking to a producer who said, i saw that headline and thought, that is winning the lottery. it is more. ever,ggest lottery tab six hundred 50 six lane dollars, roughly $100 million less than steve schwarzman last year. alix: amazing, i don't know how to respond. [laughter] david: the thing is, that is an amazing number and he is not alone. there is the competition that is substantial. jason: and i'll and private equity. alix: but does that tell you? jason: that it is a very lucrative business. alix: but all we find appearing as their eyes all this money -- is there is all this money, and they are becoming something more than what they started out to be. jason: that is true. $434 billion roughly under management at blackstone, more than double their nearest competitor and so much is not private equity. a lot is real estate, the biggest driver of all time. we saw that really notably ove

when youown the line, hear from steve schwarzman and others, they are tapping that retail market, starting to draw more money there. you talked about the equity side. the financing is really there, to bank. -- really there, too. it's not just the equity, not just the cash. vonnie: what are their targets? there can't be that many targets for the picking. >> this is very much a cyclical business. what you are seeing right now, this is where private equity has thrived in the past, what is called the car about. -- the carveout. they start to look at shaping off or carving out assets they can sell to a financial buyer. carlisle made its bones back in the early 1990's starting in the defense industry carving the --ces out of the company it's a really good business. divisions,nwanted they can clean them up a bit and then sell them or take them public separately. it can be highly lucrative. vonnie: are we going to see a wave of exits in the near future? >> certainly, that would need to happen at some point. the market would argue that valuations aren't really high. the carlisle's and blackstone's

blackstone group's ceo steve schwarzman says there is clearly a serious imbalance and trade barriers between the u.s. and china. schwartzman is seen as close to beijing and president trump, and has reportedly counseled the president against imposing tariffs. he told bloomberg television china's leaders understand that as their economy develops, the playing ground needs to be level. >> there is no doubt that there is a serious imbalance between the u.s. and china in terms of market access, and tariff levels ,nd nontariff barriers investment limitations, and part of this happens in the natural course of things. >> u.s. agents are said to have -- the saipan's casino office. fbi investigators took documents from imperial international, the company says it knows nothing about the claim to raid and denies wrongdoing. in. attracted attention for the sure amount of money recorded at the saipan casino, which is larger than at the grandest resorts. angela merkel is starting her fourth term as german attracted chancellor, swearing-in -- six months of political drift. coalitions of the conservat

we will be speaking exclusively with the blackstone group's co-founder and ceo, steve schwarzman on u.sina relations. that will be at 9 a.m. in sydney, 6:00 a.m. in hong kong, and a 6:00 p.m. right here in new york. this is bloomberg. ♪ >> a quick check on the business headlines, the world's largest bank has been told -- says i feet bc sales comply with the banks secrecy act to require lenders to some -- to report suspicious activity. days tos been given 60 improve plans on controls. is missed" us payments to some suppliers in recent days as it heads toward expected liquidation. that toare telling us zahra's failed to respond to questions. the chain filed for bankruptcy in september under the weight of $5 billion of debt. volkswagen is stepping up the .hallenge to tesla that the deal wonder undermine the push into electric cars in the mainstream model three. volkswagen says it will equipped -- equipped 16 factories to produce electric cars up from three. it aims to turn up three vehicles per year by 20, 25 -- 2025. >> up next, the latest on the election in pennsylvania. republicans are

and then in the wake of that, he and steve schwarzman go out on their own end creates blackstone, oneo mention, he goes on from that and creates an institute not to mention, he goes on from that and creates an institute and becomes a voice for fiscal policy, he creates a foundation, and a longtime chairman of the not to mention, he goes on from that and creates an institute and becomes a voice for fiscal policy, he creates a foundation, and a longtime chairman of the council of foreign relations. it is just amazing when you think about the birth of his career. ♪ ♪ mark: let's talk about german data investor confidence, it grew to its lowest level since 2016 with concern arising the against economy in europe could be hit by a global trade war. the index of investor expectations falling to 5.1%. quite of a drop. there are about 30,000 functions on the bloomberg. we always enjoy showing you our favorites on bloomberg television. maybe they will become your favorites, too. here is another function you will find useful. quickgo, it leads you to our quick takes for important context and fas

and then in the wake of that, he and steve schwarzman go out on createsn end blackstone, one of the most on from that and creates an institute and becomes a voice for fiscal policy, he creates a foundation, and a longtime chairman of the council of foreign relations. it is just amazing when you think about the birth of his career. ♪ ♪ mark: let's talk about german data investor confidence, it grew to its lowest level since 2016 with concern arising the against economy in europe could be hit by a global trade war. the index of investor expectations falling to 5.1%. quite of a drop. there are about 30,000 functions on the bloomberg. we always enjoy showing you our favorites on bloomberg television. maybe they will become your favorites, too. here is another function you will find useful. quickgo, it leads you to our quick takes for important context and fast insight in timely topics. here is one from this week. ♪ >> it is impossible to ignore america's opioid epidemic anymore. the numbers are staggering. nearly half a million americans say they used heroin in the past 30 days. heroin overd

steve schwarzman joined us exclusively to discuss u.s.rship his program. michael mckee speaking to get his trudeau, views on paris, the status of nafta. given all the headlines we have had this week. that takes place 6:30 hong kong time. this is bloomberg. ♪ ♪ david: this is bloomberg markets asia, i am david ingles in hong kong. haidi: i am haidi lun in sydney. says thereom india is talk of buying allied metals and distillers. talks to center on the owner of jim beaver -- the owner of jim beam bourbon. giving them distribution rights. hnad: china's struggling group selling its 25% stake to help pay down some of its debt. helton agreed to remove a lockup. at the close, the stock had risen pretty strongly. the group has cut its stake in deutsche bank, and some of its properties in london, sydney and hong kong. one of the world's largest assets has been told to fix its own -- its money laundering program. failed toid icbc comply with the secrecy act and maintain adequate compliance. given 60 days to provide written plans for improving. this

. >> other ceos shared cook's concerns including blackstone's steve schwarzman, is he head he's callingewhat of a negotiation to happen between the two sides. >> there needs to be a negotiated arrangement between the two countries. and i think it's important to note that most of the types of things that are being discussed from the u.s. side can be delayed in terms of their implementation and hopefully will be. >> and despite the aggressive rhetoric from both sides, there are some reports that there's some behind-the-scenes negotiations taking place. "the wall street journal" has been reporting that the trump administration led by u.s. treasury secretary steve mnuchin as well as the trade representative robert lighthiser handed the chinese, a to-do list, reduced tariffs on autos and more chinese purchases of semiconductors now, despite whatever is happening behind the scenes in public, there's still a war of words going on between the two side the chinese state media actually came up with a hit list of american companies that would suffer in the trade war. the people's daily report ment

steve schwarzman things it will become an $800 billion company.s about $115 billion of that. jason: that's right. it is a really interesting point about the challenges that face john berry now in this new job as president and cielo where he has to run the whole for. asve schwarzman has evolved a global statesman, philanthropist, counselor to president trump, president xi. john gray is taking over fertility james, who is the achitect of taking blackstone broader set of businesses. they have a big credit business. it is the biggest. they manage hedge funds as well. he has a big task ahead of him. he was a business builder and now has to really operate as host of businesses. shery: do we have any idea at this point when schwartzman will retire? jason: we don't. the fact of the matter is switchman is 71 years old.he loves this job . i talked to him a number of times about this. he gets to do what he wants. he has this great global profile. the is also very passionate about the potential for this business. he really feels like, and the numbers would be

scarlet: coming up, don't miss this, our exclusive interview with steve schwarzman at 6:00 p.m.lowed by justin trudeau of canada at 6:30 p.m. joe: in tomorrow i will look at my favorite indicators that cannot at 8:30 a.m. eastern time. lisa: and don't miss this, brought some their first-quarter earnings after the bell and we will talk about snl over again. scarlet: that does it. joe: have a great evening. this is bloomberg. ♪ mark: i'm mark crumpton. you're watching "bloomberg technology." cruz, the former student charged with killing 17 people at a florida high school last month, remains silent during a court appearance today, so a judge entered a not guilty plea on his behalf. prosecutors filed formal notice of their intent to seek the death penalty on tuesday. sbi's acting deputy director tells lawmakers the bureau missed critical tips on its public access line prior to last month's school massacre in florida. -- fbi's acting deputy. >> we received an emailed tip from a person in mississippi, who indicated that a person unknown to him posted on his youtube channel the followi

he had dinner with steve schwarzman and rudy giuliani friday night.beat and remarkably funny. the president is mercurial. in the mornings, he'll watch hours of cable television. at night, he'll watch again. small things, minor slights, white house sources have told us, can really set him off. so you have a president who is a good entertainer, by all accounts. everyone who plays golf with him says he's funny and cheerful and someone nice to be around, who often at his club is in his most relaxeded state and having a good time, laid back. then during the white house, we get account after account of the president watching television, calling his friends, getting very angry. >> josh, you're saying the news coverage causes him to be enraged, then he tweeted about it and there's more news coverage about his rage. isn't that a vicious cycle? >> in some ways it's a media and response strategy, as i had former white house strategist steve bannon has said. nothing really influences the president on a lot of issues like the news coverage. this week, the presiden

anna: that was the blackstone group ceo steve schwarzman speaking to betty liu.ll with us, chris willey. china and theut latest trade policy. larry kudlow talked about how the chinese did not play by rules, mike pompeo stepping up and he talked about pushing back against the china threat. does this look from that perspective for china or are they withstanding all of that? no doubt thats things are hotting up. anyone who has done business in this has been over decades. barriers,significant hard and soft barriers erected. it has not been a two way street. we're moving into this phase up.e it is hotting policy see some response. we will see some give with china. where it will get interesting is how much compromise will be enough compromise in the eyes of the u.s. administration because of you want to take this to its extreme it could get pretty aggressive. i am not sure that is where they want to take it. this is more about signaling. i cannot say i am terribly optimistic. we will see a major shift in the playing field perhaps to the degree that was just alluded to.

we caught up with steve schwarzman for his take on the economy. >> one of the things that's forgottenurn to this hubbub of what's going on in washington, the basic economy is doing really well. consumer confidence, business confidence, there are records. bonnieoining us is wongtrakool. digging below the surface, jpmorgan lowering their forecast, atlanta fed gdp forecast lower as well. the rest of hard landing are increasing. what is the bond market telling you? bonnie: i think that keyword shorts men used was confidence. what you are seeing his confidence and optimism of where the economy's going in you see that reflected in a lot of soft data. it has not been supported by hard data and we have seen softening in hard data over the past few months. i think with being priced in is fairly optimistic and the risk might be to the downside that the data does not come in to support that. you see retracement in bond market yields and treasuries. alix: at the same time you have larry kudlow saying fed get out of the way. the growth is not inflationary, let it rip. is that the right call and ha

. >> reporter: and other ceos shared cook's concerns including blackstone's steve schwarzman. >> if therebe a negotiated arrangement between the two countries and it's important to note that most of the types of things that are being discussed from u.s. side can be delayed in terms of their implementation and hopefully will be. >> reporter: and despite the aggressive rhetoric from both sides there are reports now that the two are negotiating behind the scenes the trump administration has reportedly handed a to-do list to the chinese that includes a reduction of chinese tariffs on u.s. autos, more chinese purchases of american semiconductors and greater access to to the financial sector now speaking to a source familiar with these discussions who said that the chinese appear to be willing to cooperate on these issues and offering to buy more semiconductors from the united states and accelerate the timeline for greater foreign ownership in securities. beyond that chinese officials have said that president xi jinping would be highlighting further financial reforms at a business forum in mid-

the fact is, steve schwarzman, tony james, they've been methodically planning this starting ten yearsanagement committee, six years ago, the board three years ago they sort of brought me into the engine room and said, understand all the plumbing of the firm, the personnel issues, and they signaled to the outside world this was coming. all of that made this much easier so sometimes these transitions can be abrupt. this certainly wasn't the case >> no, and it wasn't a surprise, i think, to much of your investor base as well and people who follow the company still, what i have found with people in your position is sometimes it's hard to let go. you ran real estate for so long. it was so important. are you able to do that? i know you're still keeping a hand in it but that part sometimes can present a bit of a challenge >> you know, the good news is in real estate, we've got 450 people, 29 partners, and the two new co-heads, kathleen mccarthy and ken kaplan, have been my partners for a long time i think they can do some even better things than i've done >> you think so? like what? >> well,

cofounder blackstone steve schwarzman enjoyed 2017, compensation came in at $787 million, his biggests seeking assets other than stocks and bonds fueled blackstone and helped schwarzman remain top dog among private equity leaders. rishaad: credit suisse boosting atuses for wealth managers twice the bank average as growth out aces other areas. a 7% riseon is seeing compared to a gain of 3% across the rest of the bank. credit suisse is in the last stages of a restructuring plan to manage money for high net worth individuals. there are five new faces governing china and a fifth of the world's population. they are among the figures to watch for when the national people's congress gets underway next week in beijing. tom mackenzie reports. ♪ are the five new faces of china's most par 4 governing body. rise loyalist, the reflects the president's power. the committee shows a tilt towards provincial experience rather than time at an enterprise. collectively they rolled over regions rich and poor. one spent three decades in shanghai, one of china's most prosperous cities. while another, the per

the blackstone cofounder steve schwarzman enjoy 2017, total compensation came to 87 million dollars, take-home ever, up from $425 million a year earlier. that is your bloomberg's news flash. tom, francine? you.ine: thank -- returned to work at a central bank. though only dealing with his position on the ecb council, we to beeased to join -- joined on the phone. us.k you for joining what do we know about the ecb? as they receive information about the details of the case of your central bank governor? >> the ecb anticorruption office is getting all of the so they canprovided take their decision on whether or not the principles of the ecb has been infringed. practice with a strong rule of law that any allegations are parting -- regarding conduct's, are taken very seriously by law enforcement institutions. parliament ofe ministers dof the trust our law enforcement security measures imposed on the governor central bank. >> you have any concerns about >> isvernor attending .till varies for the governor as you probably know, security -- they are put .n hold tom: wonderful to speak to you. a

in the meantime, blackstone's steve schwarzman said talks on tariffs dob delayed.n said it's not set in stone and implementation can be postponed. he said he anticipates that rational people from both countries would be able to come to a good solution with the goal of a more level playing field. >>> stocks to watch today, payment and packing company smurfit, smurfit kappa has rejected a revised takeover over from international paper >> papa smurf. >> i like the smurfit. the good value of smurfit at $11 billion earlier this month turned down an unsolicited offer from ip saying it failed to reflect the strong growth prospects and attractive outlook. i think the movies were bad, though, right? >> not if you have kids. >> they were abysmal, right? >> no, they were all right >>> auto parts make dana raising its cash off for the drive line business $1.8 billion shareholders have until thursday to decide whether to bank the gkn plan or choose an offer from uk's melrose for the entire company. >>> and british retailer j.k. sports struck a deal to buy u.s. chain finish line

schwarzman scholars is to be ambassadors when they go back to their own countries. 20% from5% americans, china, and 35% from the rest of the world. betty: you consider yourself a china whisperer? steveno, i am a hard-working guy, and i don't whisper much. [laughter] time, in some of my spare to make sure things work as well as they can. this is a luxury you have when you are older and you know more people. it is effortless. betty: you have quite a bit of influence and we have seen the relationship you have developed with the president. you are on his strategic forum. to beeople consider you perhaps one of the if not the u.s. executive that has the most understanding or do this relationship between the u.s. and china. i am curious seeing what you are seeing now, just trump coming out with more tariffs on china. he is surrounding himself with people who are -- we see china as a threat than a friend. what do you want to say to the president? have you talked to him recently about these moves? steve: i am not going to tell you and your vast audience. [laughter] exactly what i am saying to anybody in particular. betty: are you disappointed? steve: there is no doubt there is a serious imba