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tv   Bloomberg Business Week  Bloomberg  May 25, 2019 3:00pm-4:00pm EDT

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♪ >> welcome to "bloomberg businessweek." i'm carol massar. -- jason and i'm jason kelly. we are here at bloomberg headquarters in new york. >> in this week's issue, fighting the world's greatest art. >> and the potential $7 billion tax bill facing the heris of samsung's chairman. >> and the rich are richer than we all thought. jason: and one man is uncovering
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inequality in a whole new way. editor joel weber joins us now. you and i were talking and i ask what the cover was an you told me. this is an amazing one. . >> what we tried to do is follow where the money is. there is one guy who is incredibly good where the richest in the world with their money. a lot of it has been hidden. he has been a wealth detective who has been our two -- able to .cour data he has revealed how rich the richest are. carol: you made that distinction between income and wealth. >> that's right. and one of the things that was brought to the forefront is this wealth disparity, that income inequality that has become such a big part of the zeitgeist. his data has really been seized by democrat candidates.
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jason: let's look at this chart. >> that's right. what this shows is the u-shaped -- the rich were pretty rich, and they are getting richer again on a relative basis. >> one of the things he says here -- you notice this shape -- this might have ended up being something of a blessing. what he is saying is that wealth needs new policies in order for us to actually address what could become a serious issue. carol: definitely an enlightening story. thank you. jason: we got more on this story -- it's a deep dive. >> he's only 32 years old. he's the former student of a guy named thomas piketty, who you may remember from his surprise bestseller on inequality a few years back. zuckerman came to the u.s. after piketty four th years. the heart of his work is 300 years of history on income and wealth, and a lot of the numbercrunching was done by this guy.
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he comes to the u.s., and he starts to work on wealth in the united states and try to figure out -- one of the biggest mystery is how rich are the people in the rich people. are the people in the wealthiest country in the world? carol: talk about how he did that. it is wealthy is looking at, not income. these are different things. >> people talk a lot about income inequality, but the thing about wealth is that wealth can build over time. it is one of these things that can snowball. income is a little more equally distributed than wealth. the bottom half of the u.s. population has a negative net worth, because they are in debt, mortgages, credit card debt. what he did was he and another colleague at berkeley, another eminent economist, they went into the irs and downloaded all this data on income. you don't tell the irs how much money you have, you tell the irs how much you are making each year. with they did was this very meticulous process of turning
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that into wealth. if somebody has $100 in dividends from stocks, they use that to get a gauge on how much wealth they have. but it really required a lot of moving pieces. zuckerman -- man's specialty is taking not just one day, but a bunch of them, creating a constellation of information. macroeconomic data, cross-border flows. some survey data and estate tax data, crunch that together and figure out how wealthy are the wealthiest? carol: and they are pretty wealthy. >> yes, yes. when the paper first came out, it really made an impression. he was one of the first reliable estimates of the top .1%. we talk a lot about the top 1%, but that top .1% -- in 1980, they had about 7% of u.s.
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wealth they controlled. by 2014, 2016 are the latest numbers, 20%. carol: big change. >> almost a tripling, whereas the bottom half has not budged. >> there is a catalytic point, -- budged. jason: there is a catalytic point, and it seems to come during the reagan administration. at least that's what the data show. help us understand what happened in the mid-80's. zuckman is saying look at the u.s. in the rest of the world, compare the u.s. to japan or france. the trends here are so much more extreme. what happened here in the 1980's -- the top marginal tax rate went from 1980 to 20% in 1988. unions got a lot weaker, antitrust enforcement got a lot weaker. some of the things that have constrained wealth inequality
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from getting worse were basically loosened, and the wealth of the rich got richer. >> when you talk about gabriel zuckman, one of the things we are seeing is a trend among economists and academics as they see a shift toward more advocacy and activism in some ways, really prescribing more politicians and more policymakers where we should go. tell us what they are saying we should do with this data. >> you go back, they were giving advice to politicians back in the day but what's unique about him and his colleague is that some of these colleagues -- their prescriptions are kind of radical. they're talking about a wealth tax, elizabeth is talking about it, a lot of other economists are really raising their eyebrows -- how would that work? they are out there advocating for this stuff and they have a
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book coming out next year which is designed to be helpful to 2020 candidates who want to solve inequality. jason: here's taylor riggs. she has another look at income inequality. taylor: exactly. this is the coefficient that measures the distribution of income inequality -- all we need to know, zero is perfect equality, 100 is perfect inequality. as you can see, the line is between three to 48, income inequality is just getting worse. carol: we see it playing out in our political landscape big time. taylor thank you so much. , as a matter of fact, that income inequality is top of mind for many democratic politicians, but it didn't stop them for dropping by wall street for lunch and for money. jason: plus how president , trump's supposedly cozy relationship with kim jong-un could prevent further nuclear talks with north korea. carol: and the cisco ceo, chuck
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robbins, tells us how the trade war is impacting his business. jason: this is "bloomberg businessweek." ♪
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carol: welcome back to "bloomberg businessweek." i'm carol massar. jason: i'm jason kelly. join carol and me for "bloomberg businessweek" every day on the radio from 2:00 to 5:00 p.m., and catch up on our daily show, listen and subscribe to our podcast. carol: and of course you can find us online at businessweek.com and on our mobile app. the u.s. may be running out of options with north korea. jason: those nuclear discussions face collapse since that first summit between president trump and leader kim. >> but the tensions don't jive with what both leaders say is a great personal relationship. our politics editor has our story. >> trump has really taken on the role of being the person that is going to fix this relationship, of being the person that is
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going to negotiate one-on-one with kim, and as that has fallen apart -- you saw the nuclear negotiator, the north korea negotiator, was in south korea during one of the missile tests that prompted this latest bout of tensions. it is a pretty bold move for them to, for north korea, testing missiles while the u.s. negotiator is so close, within range of some of those missiles. jason: and with president trump -- we have seen this in a number of different cases, and this is a stylistic thing if nothing else -- where he wants to go one-on-one with world leaders, whether it is vladimir putin in the case of the helsinki summit, whether it is kim jong-un, as you've described, or even other world leaders, some allies, some traditional foes. how much does this tell us about how this president rolls? >> a lot. he is famously that way in his
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businesses as well, but really what we are seeing with this relationship with north korea is this is why we have diplomats who negotiate the details before the leaders get into the room, so everyone knows what will happen and you don't walk into a situation like we had in hanoi, where there are so many unknowns and so much work to do between the leaders that no one's really sure what's going to come out of it. carol: tell me a little bit about south korea and their role. they are at a very tricky position, an ally of the united states, but because they are within range of those nuclear weapons from north korea, they are in a tricky place. >> exactly. there's been a lot of progress made in the relationship between the north and the south. a lot of work that moon giant did both -- that moon jae-in did. he doesn't want to alienate the u.s., but also doesn't want to risk the fragile peace he has built with kim.
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south korea is providing food aid through the u.n.'s world aid, and he is hoping that will loosen things up and lead to a third summit, but the u.s. hasn't budged. jason: what do we know about the next time these leaders may get together? jillian: i mean, kim gave trump an end of year deadline in his speech before parliament a few weeks ago, which was an interesting move on his part in that obviously the end of this year is the beginning of an election year for trump, so we think that the calculation is he is trying to add to the pressure on the trump administration to come to the table again, but so far there has been no indication that the summit is on the way. jason: in the finance section, some democrats may be shunning corporate cash -- carol: but politicians are still cozying up to wall street. jason: here is reporter max
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abelson. max if you happen to tune in to : a minute of the primaries, they haven't started yet, but the competition among democratic rivals -- if you tune into orinda minute, you will probably hear things like i'm giving back the money lobbyists gave me. you might hear joe biden say i'm rejecting super pac's. you might hear, harris say corporate pack money is not welcome here. carol: corporation money. >> the goldman sachs political action committee will bundle checks from individual goldman sachs full and give it over to a -- folks and give it over to a candidate. democrats are saying we will reject that. what this story is about is that, behind the scenes, wall street donors are being wooed just as much as ever by the democratic nominees. jason: let's go back a little ways. you know this better than anyone. over the last 15 or 20 years, we have seen wall street become much more bipartisan in its giving.
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they really fell in love with barack obama, bill clinton before that, and so you had wall street -- which traditionally had been, generally speaking, a bastion of republican politics -- really start to embrace more of the democratic party, and the names that you just said have been hands out to private equity hedge fund wall street people. what are the implications of that for the politics of wallace street, and the politics, ultimately, of regulation and oversight? max: going back in time is a smart idea. what connects clinton and obama and mitt romney and john mccain is a certain centrism, an idea that wall street people want to be taxed too much, they don't want to be regulated too much, they are probably a little sympathetic to things like gay-rights, and that leads them to a place that might be nerve-racking, because right now you have biden and other centrists looking like they are
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not of a moment, which is much more progressive. elizabeth warren is proposing to literally jail bankers and executives. carol: she is not meeting with the folks on wall street. max: very important point. our donors told us that elizabeth warren and bernie sanders are the sole exception to the rule. that means, though, that the centrists, the wall street friendly candidates, have to do two things at once. on the one hand, they are echoing the en vogue progressivism of the democratic party, but all the other hand, -- but on the other hand what , this story is about is how they are dropping by a bankers office for lunch, they are having fundraisers that raise $100,000, they are getting on the phone, making plans. both of these things are happening together. carol: some of these folks on wall street you have talked to, and how many democrats they have had lunch with -- max: the answer is all of them.
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you have the former ever core vice-chairman, charles myers, interesting guy. he likes to have policy lunches. pete buttigieg comes by, talks policy, it adds an anti-socialist inch he is trying , to pull the democrats to the center. you have kamala harris shaking the hand of a puppy in the opening paragraph of our story at the home of the managing director from citigroup on fifth avenue. then you have amy klobuchar going to the home of the former canadian ambassador, bruce haymond, big, smart, goldman sachs guy, and he's planning a fundraiser for joe biden. and we could keep going down the list. the hedge fund billionaire mark lazaridis has met with at least 10 of them. bob wolfe says he will meet with 15. the answer is that except for bernie and elizabeth warren, wall street and the democrats are as friendly as ever. jason: up next, the anonymous
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cash, billions of dollars, flooding into india's election. carol: in the software giant gut.ing on one man's this is bloomberg. ♪
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jason: welcome back to "bloomberg business." i'm jason kelly. carol: and i'm carol massar. you can listen to us on the radio on sirius xm channel 119 and am 11 30, 106.1 in boston. jason: am 960 in the bay area, in london on dab digital and through the bloomberg business app. in the special money issue, india's elections are among the world's most corrupt and most expensive. carol: in fact, a reported $7 billion has been spent on this year's national races so far. jason: that was more than what was spent in the 2016 presidential in the u.s. a plan to increase transparency into a river of anonymous donations may make things worse.
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carol: we have those details from reporter jeanette rodriguez in mumbai. jeanette india's elections are : one of the world's most expensive elections. they are estimated to spend about $7 billion usd in 2019. to put it into context, roughly $6.5 billion usd was estimated to be spent on donald trump back in 2016. by some estimates, india's election is the world's most expensive. much of this money comes from a new funding instrument called the bond. -- the electoral bond. critics of the bond say it legalizes what is called black money laundering. black money is illegal awayions, money stashed unaccounted cash. , critics say that all they really do is help crony capitalists launder black money in the guise of political donations.
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however, when narendra modi came to power in 2014, he promised to rid the country of corruption, and electoral bonds and political funding was supposed to come within that orbit. critics say electoral bonds are a piece of paper which actually entrenches corruption within the system. jason: where is political will to change it, or is this how it is going to be? jeanette: right now the case is in the supreme court, and the supreme court has asked political parties to submit by may 30, the end of the month, details of all donations received via electoral bonds. that may not actually happen, -- that may not have much impact, given that on may 23, before the deadline, india is due to have election results. voters still continue to be left in the dark. it really depends on the supreme court to take that decision, because we need to remember that electoral bonds are the creation of the modi government. it has complete backing of the modi administration. it is unlikely that the modi
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administration woodcraft legislation without an order. the technology section shows the salesforce eu, marc benioff, keeping the company growing thanks to a bunch of acquisitions. check out this chart. this shows you both the number and the size, what's underneath it is he is making these bets on a whim, it feels like. carol: exactly. that's what this story gets into, how he goes about that decision-making. keep in mind that benioff has made costly errors. we got those details from our reporter, nikole killion grant. grant.le killio >> marc benioff is one of the most eccentric figures in silicon valley. he essentially decides, you know, sometimes on the spot,
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what his company is going to do next. there are these really interesting times, for instance, when he bought a company called steel brick. he asked the executives and ceo of that company to come over to his house in san francisco. they were in this board room that benioff had built overlooking the water in the bay, and he asked questions for 20 minutes, then asked for a demo. he asked them the things he wasn't interested in, and at the end, he said he wanted to buy the company. carol: and sometimes it works out, he is spot on. sometimes, not so much. >> definitely large acquisitions he did like exact target, demand where, mulesoft, have been successful. they have put salesforce in different parts of the i.t. market and cloud market from where it had been. but there have also been many deals that didn't happen, and often times they are because of his very mercurial personality. there was one point in which he wanted salesforce to be a big player in social media a few
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years ago, when linkedin had hired bankers and was basically quietly going around saying we are up for sale. in that experience, we have reporting that marc benioff told his friend and also his employee, the chairman of thompson, and john that he was interested in linkedin. then microsoft ended up buying linkedin. in the end, he would have paid more for linkedin then microsoft ended up paying. microsoft says it was always interested in linkedin, and so it didn't do anything underhanded in this scenario, but the loss of linkedin meant that benioff wanted to buy twitter. just a few months later. that was really stepping away from the focus of what his company is all about. jason: the salesforce-microsoft relationship is complicated to
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say the least, certainly by virtue of that linkedin transaction, but also in a broader sense. nico: early employees of benioff said to me that from the start, he was fascinated by companies like microsoft, and other companies that are quite large where he used to work. in some sense he wanted to be a microsoft and wanted his company to emerge in to be that strong in technology. in other ways, he had a certain level of resentment for the way those companies operated, and wanted also the respect of those executives. early on, there was an opportunity in which microsoft, when steve ballmer ran the company, was said to be interested in buying salesforce. that ended up not happening and they bought a different company instead. but more recently in 2015, this is after satya nadella emerged as the ceo in 2014, microsoft and salesforce were in negotiations about an
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acquisition. salesforce wanted more money than microsoft was willing to pay, and benioff was interested in having a very big title at microsoft. he wanted the validation and respect from the company. it ended up falling apart, and then the next year, when the linkedin misadventure happened, his close relationship with nadella, who you saw as this visionary, as this really fascinating and inspirational figure, really soured. there were some folks who said that benioff probably expected it, because satya nadella is viewed as this softer, gentler personality, versus ballmer, who was very boisterous. he could be a pushover, and satya nadella was very doubt. carol: up next, how cisco views
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a ban on huawei. jason: and our guest for businessweek talks. this is "bloomberg businessweek." ♪
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in need. live healthier, live happier, by resting deeper. get 15% off and two free pillows. go to leesa.com today! jason: welcome back to "bloomberg businessweek." i'm jason kelly. carol: and i'm carol massar. still ahead in this week's issue, how the world's ultra rich use so-called free ports to avoid paying taxes. -- paying taxes on art. jason: and how jeff bezos bank account would stack up against john d rockefeller. carol: and cisco ceo john robbins joins us for an interview. jason: we talked about tariffs,
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five g technology, cybersecurity, the ban on huawei , and so much more. chuck: about eight months ago when this began, our teams proactively thought about it. we need the statement that we have parts of the strategy and would continue dialogue to influence the outcome. secondly we would optimize our , supply chain because we have a globally distributed supply chain and we have the capacity to move things on a regular basis. our team does that as part of doing business. the third part was that if we cannot mitigate we would pass it , through pricing. our team has done an amazing job with the latest 25% really had a nominal affect, from a pricing perspective. they did such a good job of optimizing the supply chain. carol: is it more difficult the longer this goes on? chuck: my bigger worry is, if we move to the next phase, the concern is not for the impact on us at cisco.
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my concern is on the macro and what it does to customers and overall sentiment. that is the bigger concern for me. jason: what are you hearing from customers at this point? i feel like now they are starting to think about it and talk about it in a more meaningful way. chuck: i hear the same things you are hearing. we have heard some of the retail discussions over the last couple of weeks. the reality of company's inability to optimize is becoming the bigger issue. the impact on the company or the consumers will have a drag on the market. jason: what are the implications g.eryone is worried about is 5
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what impact does that have now and in the short-term? how much do you worry that 5g deployment could be derailed or slowed by these actions? chuck: i actually don't worry about that. there are multiple suppliers around the world to provide macro radio technology, that is what we're talking about. once you are off macro radio, we provide the core technology. there are plenty of alternatives and the bigger issue is the cost of capital to build at these networks, the cost to buy our customers are having to face, the regulatory environment, and the reality of the business model they can build to get the roi on investments. those are the bigger things we need to be talking about and working on. carol: one thing i want to ask you is that there has been a lot written about the ban on huawei that it creates an opportunity for you and others.
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i have seen the likes of $5 billion on the mobile market. do you see it as an opportunity for cisco? chuck: it is hard to say. we focus on innovation and working with customers. they all tend to have multi -vendor strategies to begin with. they typically would not sell it anyway. they wouldn't want to give us any negotiating power. carol: but thinking about 5g, you know this world so well. if huawei is locked out of the market, and what you are locked out of the supply chain it is , very hard to change and bring in a different supplier. i wonder, the longer this goes on, does this create an opportunity for you guys? while it -- because huawei is pushed to the side. chuck: whatever the reasons are
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a customer makes a franchise decision, because they do make franchise decisions. the big carriers have always done this. they make architectural franchise decisions. if you don't get into those, and this happens to us as well, then you are basically waiting for the next architectural transition for you to have an entry point. i have talked publicly about how we missed early waves in the web scale providers and are having to work our way back in. that is just a fact of working in this space. b carol: how long are those waves? chuck: usually, 5-10 years. carol: you could be locked out for a while. chuck: and we feel it when it happens to us. jason: when you think about 5g, i feel like when we talk to folks like you, we are talking about a massive leap forward in terms of the types of services and things that consumers and
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businesses will be able to do. help us understand what 5g looks like in our everyday lives. chuck: think about where you are today and what you can do versus what you can do 15 years. we take it all for granted today, but the capabilities we have in our pockets are just monumentally different. and this is no different. we will see a change, and this one is exponentially better than what we felt the last decade. when you talk about speed 10 times, the earliest use cases will be my 18-year-old son on his phone on the table and eight of his friends playing games, that serving as a hotspot. we should be able to deliver real-time health care in rural areas in ways we have not been able to. getting speeds into these environments because we can do it over spectrum as opposed to
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having to pull fiber and run terrestrial circuits. hopefully, it will change economics for carriers. ruraler education into part of emerging countries. those are the kinds of tolications, in addition iot, lots of use cases. carol: i like to know timelines. i am curious what some of the customers are telling you about 5g deployment. chuck: we are starting to see trials around the u.s. and around the world. there are a lot of issues related to spectrum availability. europe has spectrum auctions going on. what we see is a lot of the trials are implementing technology and taking advantage of the existing networks. as we see these trials turn into more production and the number of devices at the edge of the
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network increasing, that will lead to the need to build more core infrastructure to support capacity needed. carol: so we are still building out a lot. chuck: we are very early. this is multi-year. jason: for more of our interview, check out our bloomberg businessweek extra podcast. we talked about a lot more than just 5g. carol: company culture. jason: and what he might be doing if he was not the ceo of cisco. grab that wherever you get podcasts or bloomberg.com/podcasts. carol: we want to get more on cisco with taylor riggs. taylor: one way we can look at cisco's exposure to china is in the global security vendor space. cisco get about 16% of revenue from the asia-pacific region. that includes china. if china were to crack down and blacklist our domestic vendors,
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cisco could be hit, given they get about 16% of revenue within the global security market of the asia-pacific region. that includes china. carol: think about how the global chain might be impacted. jason: the long-term impacts we talked about as different countries go for it. taylor riggs, thanks so much. staying in asia, the wealthiest person in south korea may leave his descendents with a massive tax bill. carol: and why it is hard to sell a mega yacht in china. jason: this is "bloomberg businessweek." ♪
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jason: welcome back to "bloomberg businessweek." i'm jason kelly. carol: at sign carol massar.
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join us for bloomberg businessweek everyday on the on the radio from 2:00 until 5:00 p.m. you can also catch up on our daily show by listening to our podcast. jason: and find us online and through our mobile app. our finance editor shepherded this week's special money issue. carol: we talked to pat about two of our favorites. when is how chinese tycoons are different from counterparts in the rest of the world. jason: and a high-stakes succession battle in samsung. pat: the family behind the samsung conglomerate has about $15 billion in assets but is located in a country with one of the biggest estate taxes in the world. this is about 50%. so when the chairman passes away, there is a question about what is going to happen not to the money, but to control of this complex web of companies. jason: let's talk about that web. people think samsung, tv's and
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cell phones but it is much , bigger in a way that almost defies description. there is not a western analog. pat: these family conglomerates are very important and south korea. they are important in business and politically. jason: society, even. pat: yeah, but if you try to figure out how do you control this web, you will see that lee kun-hee, the patriarch of the samsung family, he owns a little less than 5% of samsung electronics, the name that we know. but that combined with a lot of soft power, a dense web of cross holdings of different companies, has sort of allowed him to have control of this conglomerate. but will that still be the case when the family has to come first of all, find the money to pay these taxes, and they will have to manage this web.
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carol: talk about that a little bit. they are possibly facing a $7 billion tax bill. $15 billion in terms of wealth, $7 billion is significant. pat: that is big. carol: go back to the father's informal relationship he has with so many of the companies and executives within that network. that has helped him have a lot of power and that powered is not sincerely past to his son and that is what they are worried about. right, his son, he does not have the stature of his father and has had some pretty significant legal trouble. he spent a year in jail and a lot of this has to do with these efforts to solidify the families control. two samsung affiliates wanted to merge and needed government approval, and lee found himself
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in a scandal, spend some time in prison. he is appealing that, but it remains divisive. carol: where is his father? he is out of sight. it has been several years. pat: that's right. and the state of his health is a source of tabloid rumor and much speculation in south korea. the family says he is in stable condition and dismiss rumors of hishe state of th health and they say they will pay the taxes. carol: kind of interesting. we talk about this chairman being out of sight. speaking about something else out of sight, that is mega yachts in china. i worked on that, don't judge me. let's talk about another story in the issue. this is about the mega yacht industry in china. out of sight, not happening and , yet people thought there were so many billionaires, they are buying lots of things -- jason: they will buy some boats.
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pat: it is very hard to keep a megayacht out of sight. it is big, it is on the water in it tells the world you have some money and you are buying toys with that. carol: a huge no-no in china, at least in the last years. pat: in the last two years, is not a great time to be seen eyeing conspicuous toys. that has been a blow to this niche industry of building superlong luxury yachts. but there are always efforts afoot to find buyers. and we spent some time with the salesman, who whined and dined clients and tried to show what it would be like if you had a 75 a 150 foot, 202 foot yacht. carol: talk about the sales these guys did. it is pretty over-the-top.
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pat: you throw a party, you hire a harpist while guests dine. you bring aboard a french sommelier, and this is the floating life. the problem is, you can buy the super yacht, but having that kind of infrastructure is actually a different thing from being able to do it in europe. carol: up next, a museum holding a painting valued at $25 million. jason: plus, if you think jeff bezos or warren buffett are wealthy, they are, but wait until we tell you about john d. rockefeller. carol: all about perspective. this is "bloomberg businessweek." ♪
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carol: welcome back to
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"bloomberg businessweek." i'm carol massar. jason: and i'm jason kelly. you can also listen to us on the radio on sirius xm channel 119, and on a.m. 1130 in new york, 106.1 in boston, 99.1 f.m. in washington, d.c. carol: a.m. 960 in the bay area, in london on dab digital, and through the bloomberg business app. in the money issue, free ports, or call them secret museums. tax-free places like geneva and even delaware that can hold our out of sight for decades. so check this out, it tells you how big these facilities are. 559,000, that is a lot of football fields. carol: we are seeing more come into the united states, all of this away from tax collectors. reporter hugo miller has our story. hugo: free ports get a bad name. they are, in theory and in practice, a perfectly legal way for people to store art
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essentially free of tax. free reports to the duty-free element, the port deals with the fact that they are massive dry land storage facilities. carol: how does this work? hugo: let's say you, carol, have a couple of pieces of art worth 10 million each. you cannot decide if you want to hang eight in your aspen chalet, paris, or new york. carol: you know me so well. [laughter] hugo: exactly, so instead of taking that jackson pollock worth 10 million and moving it from the next to the next, in which case you incur import duties each time you move it, just park it semi-permanently in a freeport. it is secure and you are not incurring import duties. the bad thing is you don't get to see the art unless you go to
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visit it visit. . it. jason: there are some transactional elements to this as well. this is a way to buy and sell. hugo: and there is even the salvador monday record of the mother of all leonardo da vinci paintings that sold for 600 million. this is the problem. they are changing hands, but physically not moving, staying put in these free ports. being parked indefinitely in the free ports. essentially, you have very little accountability. and yes, the operators will say we closely document everything that enters or exits. the trouble is what happens in between, which can be literally decades. hasn: that in between also the cloak of anonymity in many cases. you mentioned the shell companies. somebody does not have to put a
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name on the transaction, they just have to create something that may obscure who they are. hugo: sure. and i pressed on this when i went to recap some of the basic facts, how have your rules of ownership changed? there is one in luxembourg are that does insist on disclosure. you are looking at a situation in which almost all free ports only require you to disclose the name of an owner. the owner could be xyz corporation and nothing more. it is very hard to figure out who owns these and have they been sold. because until they exit, they might have changed hands once, twice, or three times. jason: on the back page of the money issue, i love this. how history's richest people measure up against each other. carol: perfect thing to talk about at your barbecue this
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weekend. let's get the details from reporter tom met half. tom jeff bezos is one of the : richest people ever, but certainly not the richest. his greatest competition comes from another pair of americans. john d rockefeller and andrew carnegie. what we are trying to do is look at what the net worth would be life and compare as close as possible. not using inflation, which is often a method, but something called relative outlook. looking at how much of the economy john d rockefeller had, and to be honest, there is no comparison. his net worth today would be 300 billion, nearly triple bezos. carol: talk to us about some of the comparisons. tried to go back as far as we could, and the further you go back, the harder it becomes. but right back to the beginning, we started with crassus. there was a famous proverb about being the richest man in rome, even before the emperors.
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what we managed to do is we have got pliny the elder saying he was worth about 200 million roman coins back in the day. what does that mean in comparison to the roman economy? we try to bring that up to date. that would give him a net worth of 200 billion. in medieval england, you have got eleanor, a queen who inherited lands. she is one of the uk's richest person ever but in comparison, , she had a measly 25 billion. that is the fun thing about this. across the scope of history, 25 billion looks small. jason: what is the lesson that jeff bezos can learn from some of his forebears? tom: it is definitely temporary, so make sure you make the most of it. a lot of the names i was looking at about to be honest, i had
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never heard of before. alan the red, i doubt many know who he is, he is britain's richest person ever. he had he was a cousin of $200 billion. william the conqueror. in the scope of human history, if you are lucky enough to land in this position cannot really a position, you really build legacy out of it. jason: it does feel like the buffets', gates', bezos' of the world don't want to be alan the time -- alan the red. tom: whenever i speak to billionaires, they are almost entirely focused on succession and keeping wealth through generations, or at least putting it to good use. rockefeller is a great example. in new york, just down the road, there is the rockefeller center. people still go there every day and it dominates the city in so many ways. similarly, philanthropy. perhaps the best lesson is from andrew carnegie who have his famous proverb.
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you spend a third of your life learning, i third making money, which he did, and his last third, he endeavored to give it all away. he came pretty close, ending up with 30 million at the time of his death, which is still being spent today. carol: bloomberg businessweek is available on newsstands now. jason: also online and on our mobile app. what is your must-read? carol: the cover story. first of all, i love to find out about this individual figuring out what the world wealth picture looks like, and it is much worse in terms of inequality than we all thought. but it is reminding us that we have to think differently. he also had thoughts about solutions. jason: there is a lot of wealth on wall street would lead to my favorite story. max abelson just sits there right at the nexus of money and power. coming up on a presidential election, and with all the talk about the quality and socialism, guess who is coming to wall street? a lot of democrats. carol: it is a fun read.
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you can find more stories on businessweek.com over the weekend. jason: and check out our daily business week podcast. carol: more bloomberg television starts now. ♪
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