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tv   Maria Bartiromos Wall Street  FOX Business  June 17, 2018 9:00am-9:30am EDT

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anybody from coming from says cash juan. and remember, -- saskatchewan. if you have a hit or miss be sure to tweet it to us. that's it for this have a great weekend. good night. >> announcer: from the fox studios in new york city, this is maria bartiromo's "wall street." maria: welcome to a special one-hour edition of "wall street." i'm maria bartiromo. we have got a fantastic lineup this weekend. it was a very, very big news week. in just a moment i will speak with chrysler ceo. and we'll have the latest on the historic events out of singapore's summit this week.
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reporter: this could be the summer of mega-mergers. after nearly two years of court drama at&t closed its acquisition of time-warner after a federal judge ruled in favor of at&t. the justice department announced it would not seek a delay of the merger. comcast made a $65 billion all cash bid. analysts expect disney to match or top the comcast bid. fears of a pending trade war caused stocks to tumble as the markets finished mixed for the week. the russians and the saudis are expected to announce their intent to raise output. president trump announced the u.s. will impose a $50 billion
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tariff on chinese products. the president also accused china of theft of intellectual property. china says it will respond with tariffs of its own. after 18 months the doj released the findings on the inspector general's report on the fbi's handling of the email investigation. the report accused former director james comey of insubordination of the way he handled the investigation. president trump broke his silence on the findings. president trump i think the record yesterday totally exonerates me. there was no collusion or obstruction. you will see bias against me and millions and tens of millions of my followers that is a disgrace. maria: after president trump
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continued his tough stance on trade at the g-7, could a trade war in the offing. bob nardelli is the man to discuss this with. thanks for joining us. here we are in the middle of the year. in two weeks we'll see the end of the first half of the year. how would you characterize business so far? >> the fortune 500ceos have done a phenomenal job. they give a lot of credit to this administration. 50% of them believe the next 12 months will be better than the last 12 months. 70% of them will be hiring people. they believe the new tax code will help significantly. the trump administration
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policies will help significantly. earnings per share are up 24-25 percent. so it bodes well for corporate america. if you think on the mna front, it's up 80% year over year. big deals, a lot of deals. i think from a corporate america standpoint. things are moving along extremely well. maria: they really are. 20% earnings growth in the first square. we are expecting another 20% earnings growth the next quarter. we have unemployment at levels that haven't been seen in a long time. that's good as far as where we are right now. the question is what happens next. now i want to talk to you about the policies coming out of the white house. i know the tax policies were a
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big boost for the economy. when you look at these tariffs on aluminum and steel, what's your expectation of the impact? >> the president is about fair trade. when you look at steel. 125%. aluminum at 110%. the consumer may have to pay a little bit more for that. but the steel operations -- obviously that's going to bode well to bring back manufacturing. for those industries. if you think about national security, our ability to produce steel should the situation call for that. so i think there are some good aspects of that. there is mixed reaction among ceos. some of the large retailers are very concerned about tariffs coming on imports. that's the basis of a lot of
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what they are doing today. when i was running corporations. i never had taken outsourcing strategy. i always thought what do i have to do to be globally competitive. so again i had to compete globally whether it was on tax or tariffs, whether it was on labor rates or building materials. so i think what he's trying to do is level the playing field. it may not be perfect. but he's making some good moves. maria: sources close to the president told me this is all in negotiation. while we have this list the white house came out with in terms of the specific things that will be tariffs in china. while he has announced the aluminum and steel tariffs. what is more troubling is the issue around china. i wrote an op-ed in real clear
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politics. i titled it china's deal brick breaker. property rights. it doesn't mat ferd they buy more agricultural products or energy. that doesn't solve the biggest issue which is comien tha is stealing our technology. they won't even admit they are doing it. >> when you go to china or russia, you don't bring your own phones or computers for fear there will be invasion of privacy. maria: as soon as you get into their air space they have can as and they use it. >> i think china is looks at world dominance through economics. they have a philosophy near the u.s. when i had over 40 ptfolio company with the a private equity group, they would recognize they may not have the
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management talent or expertise. they buy a piece, then they buy up to plant a flag in the u.s. if you look at some of the recent dispositions, if you look at ge, sold their a90's business to china. there are rumors they are selling their lighting tbois china. whether that results in i.p. transfers, surely it will. maria: what i wrote in the op-ed is the best you can do in china is get 49% of a joint venture. once you do that the chinese government says show us our technology. then you just transfer your technology there. in just a few years you will have a competitor in china that knows how to exactly do what you have been doing. in my view that's where we need to put our energies. >> he tried that and made some
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attempts. i think this will be a long process to try and quell some of the issues on i.p. and stealing of i.p. maria: you invested in so many different businesses. you saw health and wellness in terms of investing. you saw technology early on. where do you see growth in the economy right now? >> that's a great point. when i was running home depot we looked at mega trends. post 9/11 was safety and security. if you look at the healthcare system, that's just exploding with investments, consolidation, improving not only delivery, but the cost aspect of that. that's a big one. we talked earlier relative to what's happening with content. content is becoming king for a
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lot of mega deals we just saw approved. the at&t deal with time-warner. that's going to be a big opportunity. of course, all the technologies, artificial intelligence augmented reality, virtual reality. all of those things will be great opportunities for investments. maria: it's interesting there are more job opportunities than there are people to fill some of those opportunities. we'll take a short break. bob, you were at general electric how many years? >> 30 years. maria: stay with us. don't go anywhere. >> announcer: can ge ever regain its former imloar glory? >> it's heartbreaking to see what happened to this legendary hi.i just wanted to tell you that chevy won a j.d.power dependability award for its midsize car-the chevy malibu.
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maria: welcome back. i continue our conversation with former chrysler and home debow ceo, back nardelli. he was also a stop executive at general electric for more than 30 years. talk to us about general electric. it's really hard for someone has worked for ge myself. it's hard to watch ge at the price it is and the smaller company it is versus what it was. >> it's heartbreaking to see what happened to this legendary company. 125 years, the only original company still on the dow today. both of us put a lot of sweat equity into it. maria: the market value has been cut in half. >> i don't think anyone would
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have predicted that we would see it where it is today. john flannery stepped in and he has an unbelievably challenging task to get profitability up and cash flow. that will and big challenge. he had to cut the dividend in half. he put several businesses -- he talked about $20 billion of disposition on the table. he's anticipating while those companies generated cash, he'll get five to six times more cash by disposition to fund pension liabilities, dividend and reinvestment in businesses. it's a tall order to dig yourself out of the trench. maria: are these the right moves? i think along the way as they were selling industry, you were thinking why are they selling this business? why are they selling this industry?
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is is the right move to keep accepting off assets? >> i'm not sure he has an alternative for that. con grom rats seem to be out -- conglomerates seem to be out of favor. seeing the benefits of the various businesses where you have different businesses and jack was a master at that. so i think conglomerates boil down to the ability for management, the board, to effectively run those. if you don't have industrial experience, if you don't have the understanding and the importance of granulity, if you haven't', you are opening the door for an activist and you will have to pare off those businesses. maria: that's what happened.
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do you think the stock ever recovers to its glory days? >> i won't predict the stock. they are in a very tough situation. i think they are going to have to really probably continue with the divesttures to generate more cash. are they going to have to cut the dividend again to maintain cash flow? maria: that would be hard for shareholders if they cut the dividends again. we'll keep watching that. let's talk about the auto business. how you spent so much time there at obviously chrysler. fouro your thoughts on where we are in terms of -- your thoughts on where we are in terms of the business. are people buying the vehicles? >> i got into the car industry,
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we were at $17 million seasonally adjusted rate. i saw it fall to 9.6. i think that forced the auto industry to reduce discounts, don't extend terms. unfortunately what you see now is a little creep back into lending, reducing the rates with which it takes to get into an automobile. 70-month terms. so they are falling back into that. we saw a couple analyst reports at car shows where they will pare back on sedans, eliminate the number of small cars. i was at the pump saturday filling up. it was $3.75. we have to be careful we don't put ourselves back into a $4 a gallon. fiat-chrysler. 80% of their operating profits
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from jeep and the ram truck. maria: ford getting out of the car business. they only are going to be producing trucks. that's so amazing to me. >> i hope they are not out of cycle. if we see gas prices, we'll be out of sync again with what the consumer wants versus what the auto industry wants to provide. ed the auto industry made tremendous progress in safety in the automobiles. mary power raised the bar for vicinity at gm. i think we are seeing more technology migrate into the car. lane control with safety devices for if you look at collisions, close collisions. so i'm pleads with what they are doing there. fuel efficiencies, whether the
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cafe standards gets rolled back. a lot of hybrid cashe -- cars we you have a combination of gas and electric. i think it industry has a bright future. leaders of those counsel come police focused on markets and consumers right now. maria: will the leaders of tomorrow be the same leaders of today in terms of the auto business or will we see these, apple, google become car companies? >> i think google and apple understood quickly we'll focus on technology and they quickly discovered that building a car, aselcar -- assembling a car is tougher than they thought. tesla is going to be laying off 2,500 employees.
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they have been at it for years. they are now switching to batteries. so we'll see. maria: don't go anywhere. we have a lot more after this short break. we are taking a look at the historic summit between kim jong-un and president trump. president trump: chairman kim has before him an opportunity like no other. >> announcer: history was made singapore. but wil the kim jong-un's keep their word? their word? all it's just a burst pipe, i could fix it. their word? all (laugh) no. with claim rateguard your rates won't go up just beacuase of a claim.
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maria: welcome back. truly an historic eating in singapore this week. president trump and north korean
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leader kim jong-un come to an agreement to start the complete denuclearization of the korean peninsula. president trump: chairman kim has before him an opportunity like no other to be remembered as the leader who ushered in a glorious era of security and prosperity for his people. chairman kim and i just signed a joint statement in which he reaffirms his unwavering commitment to complete denuclearization of the korean peninsula. and we agreed to implement the agreement as soon as possible. maria: the president agreed to end joint military exercises between the u.s. and south korea. joining us is gordon chang and
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morgan ortegas. you said to me as soon as you heard that that readiness is so critical. tell me about that. >> these exercises just make sure readiness is at a high level. we need readiness there. we to deter north korea and defend south korea. readiness declined quickly especially when you have two militaries working together. i am concerned about that. we can make adjustments so for instance if you stop the big named exercises you can do training in a less conspicuous way. but nonetheless, we have to have readiness. the korean peninsula is a dangerous place even at the best of times. maria: vice president mike pence said we'll do away with the
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large-scale exercises but we'll continue training. people raised a red flag about this. they said no, these exercises will continue. >> the north koreans have two big exercises in the winter and summer training cycle. they forward deploy their military. and they have chemical and biological agents. this is a dangerous situation. maria: by all accounts given the situation you referred to, this meeting, the first time and u.s. president met with a north korea leader is extraordinary. >> i think it's extraordinary the way the president is conducting diplomacy. i think he's approaching it like a businessman. where two ceos get together
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and then hammer out the details. we tried the six party talks to get the north koreans to come to the table. we ignored the rhetoric. and while we were ignoring it, they continued to build capacity. it's not just the weapons. it's also about cyberspace. north koreans are one of the most of sophisticated actors on the planet when it comes to cyber warfare. maria: do you believe kim that he is going to work toward denuclearization? >> i think the north koreans have consistently proved to be liars and cheats. saying that. the president had no option but to try to engage him directly. we'll have to continue to hold their feet to the fire through sanctions and economic means while keeping a military presence there. it's important for the south
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korean relationship, but china as well. i think it south korean businesses would like to see sanctions eventually go. we would like to see more economic trading between the two states. but when you talk about the division the -- the vision president trump was trying to present to kim jong-un, it was an economic partnership. a vision for what north korea could look like. maria: someone told me a funny story. he has a real personality. he said here is north korea, the rest of the world should see it. maybe then i'll go to miami and smoke a cigar. he has a vision. would he want that to happen in north korea? i'm talking about economic activity and freedom. >> i don't think so. but as president trump said we have to give this guy a chance.
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he is different certainly. kim jong-un is a fascinating individual from what we can tell. he's not like his father. his father was a hermit. he's have much like his grandfather. a charismatic individual. they have a playbook to stay in power. keep people destitute. no middle class, no revolution. that's too simplistic. but that has been what the kim family has done over decades. so i think kim feels the pressure. there is an expectation that things will get better. they have heard of all of these summits and diplomatic outreach. so kim has to give into that a little bit. but what he's trying to do is prevent a wholesale opening which would


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