tv Maria Bartiromos Wall Street FOX Business May 4, 2018 8:00pm-8:31pm EDT
thank you that's it for us top thank you for being with us. monday, congressman ron desantis and congressman andy biggs among our guests. in the meantime, have a great weekend. good night. . happy weekend. welcome to the program that analyzes the week that was and helps position you for the week ahead. i'm maria bartiromo. coming up, kyle bass, my special guest. and then later on in the program, my interview with wells fargo ceo tim sloan, candidly talking about the scandals that's plagued his country recently. first, deidre bolton has the big headlines impacting everything from wall street to main street this week. >> april's jobs report was mixed. unemployment dropped to the
lowest level since 2000 in 3.9%. that headline number was strong but there were fewer jobs added to the u.s. economy than forecast. 164,000. wage growth rose to 6.2%. employment specialists see a 3.9% level as a competitive job market. president trump's economic team was in beijing on thursday and friday. trade talks are intense. the u.s. and china are so far apart on big issues, the u.s. wants to reduce its trade deficit with china by $200 billion by 2020. china wants the u.s. to back off on threatening tariffs on chinese goods of up to $150 billion and accusations of intel leg chuintellectual propen rife. as they continue negotiating, the meetings, a win. the u.s. delayed trade tariffs
against canada, mexico and the eu for one more month in regards to steel and asylum. slum. aluminum. apple reporting 273 per share in earnings on revenue of $61.1 billion. iphone sells for slower than in the past. but the tech giant made up in its services and wearable businesses. apple announced it's planning a 100 billion-dollar share bayback program, the largest on record. some cite the tax reform bill as part of the reason. mcdonald's, home of the golden arches posted 179 per share on revenue of $5.14 billion. more chester bought premium priced items. even with positive earnings news from numerous companies, trade was rocky this week. the dow, the s&p 500 and the
nasdaq finished mixed. mmaria, back to you. maria: stocks capped off with the latest jobs report on friday. the president's economic team visit to china to discuss the trade imbalance and the threat of intellectual property by china. joining me right now, one of the most respected investors in the world, kyle bass, the chief executive officer of hayman capital company. good to see you, kyle. thanks for joining us. >> you too. maria: let me get the macro story from you and your reaction to the jobs numbers out on friday. the number of jobs it was weaker than expected, we know, even the unemployment rate falls below 4%. what was your take? >> well, you know, my view on jobs is you have to think about what our government is doing. with the tax cuts we're going to stimulate our economy by
$350 billion over the next 12 months. it's back-end loaded toward 2019. but we're stimulating while we're at full employment. so we, at our firm, believe that is going to leads towards inflation and it's going to lead towards wage inflation. if you look around the world and look at how much money the global central banks have printed. we look at the world as global m-2, money around the world divided by global gdp. that ratio is the highest it's ever been. 110% of global gdp is where m-2 sits. and historically throughout the last 100 years, that ratio is somewhere between 30% and 50%. today it's at 110%. maria: wow. >> we see so much money around the world as an unintended coins consequence of qe.
we see wealth gaps widening, full employment in the skill level sector and permanent unemployment from the displacement of factory workers by china and southeast asia. so it's a fascinating world that we're living in today that they say textbooks don't have an answer for. maria: you would think that the dollar would be trading better but that's not the case. so what do you want to do based on all of these single nas. you want to short the market or be all in? >> i want to be right in between there. no. i think that, i think that -- so what i'm trying to say is, you're going to see -- you're going to see real inflation happening. this time it's going to be a global phenomenon. it's not going to be, let's say, contained by a sovereign wall or one down tri's policy. it's going to be global in its nature and that's something we haven't experienced as a world in a very long time. and so when you ask do i want to
be a in the scks or do i want to be short, you know, think that there's so much money around the world that, you know -- i'll give you an example of the ridiculousness that we're seeing. we just had a painting auction that was maybe leonardo d davinci, we're not sure, that was restored, it traded for 450 $450 million. a picture of jesus bought by an arab. you can't make this stuff up, what's going on out there these days. i think you're going to see -- in periods of inflation and maybe we'll see stag sb flation. and in those spear ideas, stocks, you know, in inflationary periods stocks keep up with 75% of the numbers. so i'm not saying be short stocks. i'm just saying that this macro environment that we're kinding heading into, given all of the central bank's actions, the fed
pulling back, china staying on the gas pedal and the ecb might be pulling back, i think you just need to be -- i know this sounds like a weatherman. you needs to be selective about what you buy but you don't want to be short the whole market. that's my view. maria: where do you see growth right now? where are the opportunities from your standpoint? >> we look around the globe. we own om things her some thing. but. the majority of cap l is focused on where we see opportunity in southern europe and primarily greece. you think about the u.s. great depression, we had a reflective snap barbing in two or three years. they've had eight years of a complete disaster in their economy. and you're seeing every macro indicator in southern europe is heading higher. we think there's tremendous opportunity in a small country in southern europe and that
segues into latin america. argentina has had to absolutely move their short-end rates in emergency fashion multiple times. they've moved it almost 900 basis points in about a week. imagine if the u.s. raised the front end 9% in a week. arch tinian builds with trading and their currently has gone from 18 to 22 on the dollar. maria: stay with us. i want to ask you about china when we come back as well as the credit markets. we've got more with hayman's kyle pas bass when we come back. can the president's economic team get co concessions from cha without avoiding a trade war? >> we're going to be put in a nation if we don't more with kyle bass when
maria: welcome back. with the u.s. and china talking trade this week and crucial talks ahead of the korean peninsula meeting between the president and kim jong-un, we are watching asia. we're bag right now with hayman capital management founder kyle bass. kyle you're invested in china, in hong kong. talk to us first about what you've witnessed in terms of the u.s.'s stance against china and what china does in terms of intellectual property theft as well as the trade deficit, $375 billion deficit with the u.s. >> right. if you look at the u.s., you know, current account balance, which, you know balance of trade is one of those key inputs and a key driver, we are basically seeding we think 450 bail ondollars a year of our weght to mostly southeast asia, a little bit to mexico. and our policy with china -- we allow china to send to the wto
in 2000, is one of being a pass passivist. it goes back to kissinger, excek accelerating under obama. first what was happening wa wast was just cheaper to make things over there. and china plays the long game. they run a giant trade imbalance with us but they steal our intellectual property. whether you look at the bipartisan commission that was put together under president obama or if you look at the council of economic advisers or the department of defense reports over the last, call it, 12 months twhrb' months there'ss that ip theft from the u.s. to china has been right around 3 to $500 billion a year.
3 to 500 billion. maria: that's a big number. >> it's a number that's unconscionable. and yet the narrative that china develops in the past that we're an open society, an open economy and we need to continue globalization and free trade. what china is saying we need to keep stealing as much as we can from you, we need to keep running the largest trade deficit that we can. and basically we're going to be put into a sur vile nation if we don't act. and i applaud the actions of lighthouslighthizer and trump ad everyone getting tougher with them. it's hard to say the exphiks suggest we could keep pieing cheap things from china. but the sovereign implications are so large that we need to wake up and applaud what they're doing. maria: and that's why the u.s. blocked a deal between qualcomm and broad come.
come. there were national security issues around that deal. and china participates in 10% to 11% of all capital deals. they're investing in inveigh tiff companies in the u.s., transferring their technology and invasion to china and beating us at our own game. the troubling thing is nay ear doing this in ai, robotics, all of the industries that we're counting on tomorrow to grow. >> these exactly right. you know, there are a few interesting points that you just made. when you're looking at ai on arvr, semi conductors, robotics where they have enormous investments, they're investing in the u.s. through venture capital arms set up, there are many chinese nationals in our labs funded by the u.s. we don't have a call it human management policy for defense and we must legislate one.
we must change receive yous. we must fund from congress instead of the agent agents thae members of the organization. here's the good news. we're working on it. maria: good for the trump administration to push back. because everybody gets this. we know china has been stealing from us for years. we'll see where tt leads. kyle, good to see you this weekend. thanks so much. >> great seeing you. maria: hayman capital management founder kyle bass. when we come back, my interview with wells fargo ceo tim sloan. stay with us. >> the wells fargo ceo is hitting back at critics. >> most don't know anything about the company and candidly don't know what they're talking about. >> he tells maria a lot more than that when "wall street" returns. n do it with what's already within me.
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next week, wells fargo will hold on investor day for analysts on thursday. investors want to know when rev will stabilize, growth might resume. management are touch on returning capital to shareholders as well as where expenses stand. the ceo and cfo have committed to lower expenses in 2019 and 2020. i addresse addressed much of thi spoke with ceo tim sloan earlier in the week with the latest information that wells fargo is being invested by the labor department and what sloan is doing to turn things around since becoming ceo. >> there has been a lot going on since i stepped into the role about 18 months ago. one of the things that i said to all of our stake shoulders is that we need to rebuild our reputation with all of them. and first and foremost it was with their team members and customers.
but it was also looking at all of our policies and practice to make sure we're doing the right thing, which is what we're in the midst of doing. some of the items that you mentioned, all of them, were items that we found, reraised our hand and escalated. maria: well, not the fake accounts. >> well we are in terms of the accounts, the retail accounts that we sold to customers that maybe they didn't need, we're in the midst of remediation. we've reached over to 120 moil ondifferent customer120 millions to say if you have an issue, come in and see us. we're almost all the way through that process. maria: you've dismissed people, had people leave the company, put a new slate of board of directors in place. you've made some changes but there's real reputational risk and there's risk in terms of people trusting the bank again. how are you going to get people to trust wells fargo again,
convince them that the bank has integrity and these things were one-offs? >> people trust us every day. we have over 70 million customers. our business is growing. the retail banking business is growing. products and services are growing. the loyalty scores that we have from our customers are all improving. there's a lot of good going on at the company. but you're right. we need to rebuild trust with our stakeholders. how do we do that. we make sure that if there's anything that we did that was improper with a customer, that we make it right by them. that we fix anything that needs to be fixed at the company and then we focus on going forward and that's building a better wells fargo and we're doing that every day. maria: how do we know we're not going to find another misdeed under a rock. we thought everything was over and in the rearview mirror and then we find out about the 401(k) inquiry. >> again, we disclosed that inquiry. and that's part of the increased transparency that we have at the company. i've been very clear to say,
let's not use the typical financial materiality standard that most firms do in terms of disclosure. let's look at what could have a reputational impact. maria: just because you disclosed it doesn't mean it's changed the situation. we're looking at more misconduct in the 401(k) business. >> we don't know that, maria. that's why we're looking inthooo that. if there's issues in terms of improper conduct with our customers, we'll make it right by them. maria: you've been at wells for a long time. >> 31 years. maria: you were the cfo before you were the ceo, had a lot of potions in leadership. and a lot of people say look, tim sloan is a good guy but he's an insider. you need a complete sweep. you need outsiders coming in, new blood because this is deep seeded culture that is bad. and you say? >> i appreciate you saying i'm a
good guy. maria: i met you years ago and i, as soon as i met you, i said this guy has integrity. but that doesn't change the fact that you've been there 31 years and you are part of the system at womens fa wells fargo. it's an easy finger to point. get out the people who have been there 30 years and get new blood in there. >> most of that criticism is from people that don't know anything about the company and candidly don't know what they're talking about. i think that would be absolutely appropriate criticism if after being in this role for a year and a half we haven't made any changes. we've made fundamental changes in terms of our leadership, in terms of the organization and we're making things right for our customers. and we're continuing to innovate and grow this company. maria: you've got the investor day coming up next week. what will be your main message to investors . >> your main message is going to be that you can bet on wells fargo. we've had a terrific history in this company. we've got great people, great products, we've got a great
customer base. there's no question we have challenges. we've talked about those. we've got to rebuild trust with our stakeholders. imu in termbut in terms of the n for the company, i'm optimistic about the future. maria: our thanks to tim sloan. don't go anywhere. more "wall street" right after this.
maria: let's take a look at the big i vepts coming up in the next week that could impact your money. monday, data on consumer credit will be released, the start of a big earnings week. tyson foods, cisco and hertz reporting their quarterly finding. tuesday market movers like the nfib survey will be on the docket. we'll get the latest earnings from walt does sni, wendy's and mayor yot wednesday, the consumer price
index, always closely watched. also wholesale trade out in the week ahead. in terms of earnings, 21est century fox, roku, hostess and home depot. thursday, the consumer pries index is out. inflation watch. the treasury will release the federal bungt numbers, earnings from news corps and duke energy. friday da data on impocket impod export. meaning while coming up, the ceo of bnt north america, my special guest will be here. i'll see you sunday morning on the fox news channel, join me. the program live at 10 a.m. eastern, among my guests, kevin mccarthy and former attorney general michael mukasey. weekdays here on the fox business network 6 a.m. to 9 a.m. eastern "mornings with