LIGHTS FROM HOLLYWOOD'S BIG E
NIGHT THE OSCARS, FIRST TOP
STORY OF THE HALF AN HOUR,
INVESTORS ARE BRACING FOR ROLLER
COASTER WEEK, FUTURES VOLATILE
THIS MORNING, DEAL ON THE BOOKS,
WE HAVE MARKETS AT THE LOWS
RIGHT NOW, DOWN 40 POINTS ON THE
DOW JONES INDUSTRIAL AVERAGE
AND, OF COURSE, NEW WORRIES OVER
TRADE AFTER THE DOW CLOSED DOWN
FOR A FOURTH SESSION IN A ROW ON
FRIDAY AMID FEARS OVER THE TRADE
NEW TARIFFS, JOINING US THIS
MORNING TIGER 21 CHAIRMAN
MICHAEL, THANK YOU FOR JOINING U
MICHAEL, THANK YOU FOR JOINING .
>> THANKS VERY HAVING ME.
MARIA: HOW WORRIED?
>> THIS TIME IS JOBS FROM
TECHNOLOGY, COMPUTERIZATION, AI,
THAT'S WHERE THE REAL JOB LOSS
IS COMING FROM, ABOUT 80% OF THE
LOSS, ONLY 20 PER FROM TRADE
ISSUES SO THEY WANT TO MAKE SURE
WE ARE FIGHTING FIGHTING THE RIG
WE ARE FIGHTING FIGHTING THE RIT
WE ARE FIGHTING FIGHTING THE RIW
WE ARE FIGHTING FIGHTING THE RIR
WE ARE FIGHTING FIGHTING THE RI.
MARIA: THE PRESIDENT HAS BEEN
SAYING THAT HE WANTS TO HELP THE
STEEL INDUSTRY, ALUMINUM
INDUSTRY, THAT THEY ARE
FAULTERRING RIGHT NOW BUT YOU
SEE IT DIFFERENTLY AND ALSO IN
THE OP-ED TODAY FROM THE JOURNAL
BASICALLY SAYING IT IS WHAT IT
IS, THERE'S ONE CEO FROM A STEEL
COMPANY SAYING DON'T LOOK TO
THIS INDUSTRY AS A JOB CREATOR.
>> WELL, STEEL AND ALUMINUM HAVE
BEEN LOSING JOBS FOR DECADES.
THAT'S WHY WE'VE HAD ROUNDS OF
TARIFFS BEFORE 2002 BY PRESIDENT
BUSH, PRESIDENT CARTER BACK IN
THE 1970's, THIS IS REALLY AN
OLD STORY AND IT'S NOT BIG OR
IMPORTANT PART OF AMERICA'S
INDUSTRIAL BASE RIGHT NOW, YOU
KNOW, AS YOU SAY TECHNOLOGY IS
REALLY WHAT'S DRIVING AMERICAN
GROWTH.
>> YEAH, AND LIKE AVALANCHE,
SMALL AMOUNT, THEY TALK ABOUT
HOW SMALL THE DOLLARS ARE, BUT A
SMALL PEBBLE CAN START A BIG
AVALANCHE AND THAT'S A TRADE WAR
THAT WE DON'T WANT RIGHT NOW.
JON: DO YOU BUY THIS ARGUMENT,
WILBUR ROSS SAYS THERE IS A FEW
BILLION DOLLARS IN TARIFFS,
TINNY PART OF THE OVERALL
ECONOMY, DON'T WORRY ABOUT
CINCINNATI.
>> I DON'T BUY IT AT ALL BECAUSE
ONE THING CAN LEAD TO ANOTHER
AND RIGHT NOW WE HAVE VERY
DELICATE RELATIONSHIP WITH CHINA
AND SOUTH KOREA, WE SHOULDN'T BE
PIN-PRICKING AND WONDERING WHERE
-- THESE ARE PEOPLE THAT WE NEED
TO BE WORKING WITH CLOSELY GIVEN
WHAT'S GOING ON IN NORTH KOREA
AND ELSEWHERE.
JON: WHAT DOES THIS MEAN FOR
MARKETS AND INVESTORS?
WAS THIS A ONE-TIME SELLOFF OR
IS THIS THE KIND OF THING THAT
COULD TURN A BULL MARKET INTO
SOMETHING THAT GOES NOWHERE OR
DOWN?
>> WE HAVE A FRAGILE MARKET.
IT WOULD BE FOOLISH TO PREDICT
WHERE IT'S GOING BUT WE KNOW
THINGS LIKE THIS CAN BE LIKE
POPPING A BALLOON.
IF YOU LOOK AT FUNDAMENTALS
RIGHT NOW, WE WERE BENEFITING
THE TAX DEDUCTION, EVERYBODY ON
A HIGH WITH THAT AND SO THIS
DAGEN: SELF-INFLICTED WOUND IN
TERMS OF ECONOMIC POLICY COMING
OUT OF THE WHITE HOUSE.
>> I THINK SO.
DAGEN: A LOT OF THE ARGUMENTS
THAT YOU HEARD FROM THE WHITE
HOUSE THE LAST SEVERAL DAYS,
THEY ARE FURIOUS THAT STEEL
INDUSTRY LAST YEAR NEW CORE MADE
$1.3 BILLION PROFIT, YOU GO
THROUGH THESE STEEL COMPANIES,
AGAIN, YOU'RE PUTTING AT RISK 6
AND A HALF MILLION JOBS IN STEEL
CONSUMING INDUSTRIES IN THE
UNITED STATES TO SAVES 40 OR
150,000 JOBS OR TO PRESERVE THEM
AND IT'S NOT JUST ABOUT STEEL,
IT'S HOW ALL OF THESE OTHER
NATIONS REACT AND WHEN YOU HAVE
THE VERY JOB CREATORS IN THIS
COUNTRY LIKE THE AUTOMAKERS
SOUNDING A WARNING SAYING, HEY,
YOU'VE BEEN PUTTING PRESSURE ON
US TO BRING JOBS BACK HERE, YOU
JUST DID SOMETHING THAT'S GOING
TO CAUSE US TO GO AND SEEK CHEAP
STEEL ELSEWHERE, THEY ARE MORE
LIKELY TO MAKE CARS IN ANOTHER
NATION AND YOU JUST HANDED A
VICTORY TO FOREIGN AUTOMAKERS.
>> YEAH.
ABSOLUTELY.
MARIA: ARE PEOPLE INVESTING
ALONG SIDE THESE THINGS, WHAT
ARE YOU SEEING IN TERMS OF
MEMBERS AND HOW THEY ARE MOVING
MONEY RIGHT NOW?
>> MOST OF THE MEMBERS ONLY HAVE
23% IN PUBLIC EQUITIES AND MOST
OF THAT IS ETF'S PRECISELY
BECAUSE THEY DON'T WANT TO BE
MARKET TIMERS, ALPHABET, AMAZON,
AND FACEBOOK, OF COURSE,
BERKSHIRE HATHAWAY, BUT THE
POINT IS THESE ARE COMPANIES
THAT CAN SCALE AND THEY ARE --
THESE AREN'T GOING TO BE AFFECT
BID THE STEEL TARIFFS, THESE ARE
TECHNOLOGY COMPANIES THAT ARE
SCALABLE WITHOUT LABOR.
SO OUR MEMBERS ARE NOT
MARKET-TIMERS EXCEPT THE FEW WHO
ARE REAL TRADERS, OUR MEMBERS
ARE FOCUSED ON PRIVATE EQUITY
AND REAL ESTATE WHERE THEY CAN
ROLL UP SLEEVES AND TOUCH AND
FEEL THE ASSET AND MOST OF THOSE
ACTIVITIES ARE NOT GOING TO BE
TOO AFFECTED FBI -- BY THE TA
TARIFFS.
>> WHAT ARE YOUR MEMBERS FEELING
ABOUT ALL OF THIS RIGHT NOW?
>> OPTIMISM AND CONCERN AND WHEN
I SAY THAT OVER 70% OF ASSETS
ARE IN RISK EQUITY AND ASSETS,
REAL ESTATE PUBLIC EQUITY, OVER
70% SO THEY ARE OPTIMISTIC ABOUT
THE LONG-TERM FUNDAMENTALS, WE
HAVE SUCH STRENGTH IN THIS
COUNTRY, OUR LEGAL SYSTEM, OUR
TRANSPORTATION NETWORK, OUR
ENERGY COMPLEX, ALL GIVES US A
REAL TAIL WIN FOR SUCCESS SO THE
LAST THING WE WANT TO SEE
SCREWED UP BY SOMETHING THAT
UNINTENTIONALLY ESCALATES, IT'S
T NO THE 9 BILLION-DOLLARS THAT
SECRETARY ROS IS TALKING ABOUT,
IT'S WHAT THE REACTION MAYBE IN
GOING TO OTHER SECTORS THAT
COULD HARM.
DAGEN: AGAIN, I SAID THIS
EARLIER, 5 TO $6 MILLION PER
STEEL JOB WHEN YOU DO THE
9 BILLION MATH, HOW ABOUT EVERY
OTHER WORKERS, MILLIONS OF
WORKERS, WHERE IS MY PAY-OUT TO
RESCUE MY JOB?
[LAUGHTER]
JON: WHY DO YOU CALL THEM
MEMBERS AND NOT INVESTORS.
MARIA: EXPLAIN TIGER 21.
>> IF YOU THINK OF FOOTBALL,
BASKETBALL, 1 AND 17,000 PEOPLE,
OUR MEMBERS ARE 1 TO 10,000 AND
1 IN A 100,000 GLOBALLY OF
ENTREPRENEURS THAT HAVE CREATED
GREAT WEALTH.
MEMBERS COME TOGETHER EVERY
MONTH IN PRIVATE SETTINGS THAT
ALLOW THEM TO DISCUSS JUST WHAT
WE ARE TALKING ABOUT BUT IN A
TOTALLY CONFIDENTIAL SETTING AND
WE BRING IN THE WORLD'S BEST
EXPERTS, WE JUST HAD ANNUAL
CONFERENCE, CONDALEZZA RICE WAS
THERE AND BECOMING WEALTH
PRESERVERS AND WEALTH MANAGERS.
MARIA: WHAT ARE THEY SAYING
ABOUT THE CRYPTO CRAZY, EVEN THE
MARKETS WHERE YOU BUY DIGITAL
COINS ARE POSING A RISK
ACCORDING TO WALL STREET JOURNAL
INVESTORS LOST 1 AND A HALF
MILLION DOLLARS AFTER TWO MAJOR
HACKS.
>> YEAH.
>> BITCOIN IS BIG TOPIC FOR YOUR
MEMBERS, RIGHT?
>> IT IS, BUT IF YOU LOOK AT THE
AUTO INDUSTRY THERE ARE 100 AUTO
INDUSTRIES THAT GOT
CONSOLIDATED, THE VOLATILITY IN
BITCOIN, THIS IS A BOLD NEW
BEGINNING, BITCOIN, BLOCK CHAIN
AND ALL THE OTHER CRYPTO
CURRENCIES.
LAST WEEK JPMORGAN ACKNOWLEDGED
THAT BITCOIN AND BLOCK CHAIN
COULD HAVE A MATERIAL IMPACT ON
THE FUTURE BUSINESS, IT'S GOING
TO CHANGE THE WORLD OF FINANCE,
OUR MEMBERS ARE LOOKING NOT JUST
AT BITCOIN, THE VOLATILITY IS
EVIDENT OF THE NEW MARKET COMING
TO BEING, THIS IS GOING TO
CHANGE THE WAY BUSINESS --
JON: LEADING ENTREPRENEURS AND
PEOPLE WHO STARTED BUSINESSES
WHO ARE SAYING, YEAH, THIS IS
REAL, JAMIE DIMON IS WRONG, THIS
ISN'T A FAD OR CRAZY.
MARIA: HE SAID HE WAS WRONG AS
WELL.
>> IF YOU WERE IN VENEZUELA OR
OTHER COUNTRY, BITCOIN WOULD BE
MORE IMPORTANT TO YOU WHEN
YOU'RE WORRIED ABOUT GOVERNMENT
INTERVENTION OR CONTROLS, IF
THERE'S A CURRENCY THAT CAN GO
PAST ALL OF THAT, THAT'S GOING
TO CHANGE THE WORLD.
MARIA: ALL RIGHT, WE WILL LEAVE