Trim apple and sold off paramount at a loss. Speaking of paramount, the company is, or its special committee is opening up negotiations with sony and apollo. Theyre also talking with skydance as well about their bid for the overall company. From here at the Milken Institute global conference in los angeles, the next two hours, were going to be joined by marc rowan, David Solomon, and darren woods. So, nice lineup ahead, guys. Lets begin, david, with buffett and apple after that stocks friday rally. Berkshire says it did trim its stake by about 13 to just over 135 billion in q1. Didnt stop buffett from praising apple at the meeting over the weekend. Take a listen. At the end of the year, i would think it extremely likely that apple is the largest common Stock Holding we have now. When we look at cocacola and American Express and apple, we look at them as businesses. Now, theres differences in tax factors, managerial responsibilities, all sorts of things, but in terms of pulling your money, we always look at every stock as a business. And we dont we have no way no attempt made to predict markets. We have no attempt made to pick stocks. Jim said the business may be even better than coke axp and said the iphone is probably the best product of all time. He definitely endorses tim cook there. I struggled to figure out whether he was in that camp which just says, theres nothing new or the camp that says, were on service. And also, remember, tim cook is adamant, its a tech company, and i wasnt sure whether buffett felt it was a Service Company with tech. Now, these none of these have to do with the fact that hes selling some. David, you know that apples become very controversial because of whether it has growth or not and whether its just afternoon iphone Company Without something new. What is your impression about what people are saying . Say, about vision pro, does it matter . What else is moving the needle that theyre doing . Does that impact, do you think, what buffetts thinking . I really dont know, jim. Youre the only person whos talking regularly about vision pro, and as our viewers know, you are singlehandedly trying to make sure it becomes a key part of the enterprise, so to speak, that businesses use it. But beyond that, as you well know, i think the focus now is, what, about a month away, right, at the Developers Conference and what the company will be saying specifically about generative a. I. , its inclusion in the next generation iphone and whether that will truly drive an upcycle in sales. Obviously, we are coming off a quarter that was well received by investors, jim, as you know, and i mean, buffetts going to be an owner here for a long time to come, even with reduction a bit in the overall size of the position. Well, david, theres no doubt that if you have a refresh cycle that is a. I. , which is what tim cook told me last week, then you would upgrade your phone, because that is the first real change, not incremental change, but real change. I postulated that some of the things that samsung has, the android system, you know, including, you know, you get to circle things and the one where if you speak, it allows you to speak in the language that youre with. I didnt go into the specifics of that, but tim cook told me, dont worry about that, that this stuff will be so much better than apple has. So, david, i mean, i cant imagine not wanting to get that phone if it has a. I. In it. Okay. Well, thats thats a positive, isnt it . I thought so. And when it comes to the vision pro, there was an article that i read this weekend that said that 100 Fortune Companies have gotten it, so that means half of the fortune 100 has taken vision pro, which this wag said means theyve sold 50 vision pros. Kind of left me hanging on the vision pro. When all else is when everyone else is talking about vision pro, carl, i do believe that our friend, jim cramer, will still be talking about it. So, they got that going for them. Can i call it spatial computing . Thats what apple would call it. Spatial computing, which is used to be able to make things a digital twin, to be able to sell things, houses and cars. Carl, i know im in the minority on this, and i dont have any bones to pick. Minority is the wrong word. Early, i think, is the right word. Early is good. I got it from jensen huang. I didnt get it from tim cook. As for berkshire, the other big topics, able, the cash, paramount, and what buffett said about a. I. , deep fakes, and scams. Take a listen. If i was interested in investing in scamming, its going to be the growth industry of all time, and its enabled, in a way i obviously, a. I. Has potential for good things, too. But i dont know how you based on the one i saw recently, i practically would send money to myself over in some crazy country. I do think, as someone who doesnt understand a damn thing about it, that it is it has enormous potential for good and enormous potential for harm, and i just dont know how that plays out. David, comparing it to nuclear weapons, genie out of the bottle. You two are Kindred Spirits on this front. We are. They dont call him the oracle for nothing, guys. Listen. That said, of course, as mr. Buffett indicated, theres very little that we fully can understand, to a certain extent. Even its creators dont fully understand. But it may not be as much as sort of the apocalyptic things that i kind of kid about on air, as you guys know, as much as the deep fakes and the ability for bad actors to use generative a. I. To their ends, and i certainly think that seemed to be where buffett was more focused, but harm is harm. And while, you know, maybe theyre not going to replace us just yet with the a. I. Generated robots and thats a ways away, this is much nearer term, dont you think, jim . Oh, yeah, david. I was arguing with someone about a medicare scam where i knew it was a scam, and i knew that they had my medical records. I wish they did not. I dont know who gave up my medical records, and i was very cognizant that i went on too long and that they could easily imitate my voice doing something if they were going to do a. I. , because once you have the cadence, you can make anybody sound like you, and carl, thats r a real threat. Someone sounded likeme and i said, listen, we have a flash crash going on, well, it could do some damage. On the anniversary of the actual flash crash day. Yeah. How about the cash . Theres been some charting it against the berkshire market cap. By that measure, its not very extreme. No. I also know that there was this bizarre mention of a Canadian Company. I emailed becky and congratulated her on her great coverage, of course, and said, could this be enrich . Thats a Canadian Company that has got a huge pipeline, and he loves pipelines, and then i was also concerned. He talked about geico and not having the right technology. You know, geico would be the company that would bring down the cost of insurance. I think were all conscious. When you get together, not that thats our topic, we got together this weekend about the derby, and thank you for that great pick, number 11, and i wont mention your name. Good ratings, by the way. Very good ratings. But i did think yeah, good ratings. I expected geico to be the costcutter, and geico has not been there. Progressive uses a huge amount of a. I. To figure out instantly whether their off or on their market. And david, i dont know whether you have checked your Auto Insurance recently, but it is probably the thing that has gone up the most. Yeah, no, like a lot of americans, i can attest to that. Yeah. I recently got my bill because i renew towards the end of may, and it was sticker shock, no doubt. Very significant. I didnt figure out the percentage increase, guys, but it had to be very large. Thats all. I tried sometimes you look at a bill, and youre like, i dont want to think about how much that went up. It was that case. A lot of people have been holding back on fixing a problem that they have in an accident, carpal. They dont want to report it because theyre afraid their insurance will go up even more. It is ripe for a disrupter, the insurance industry. My father had geico, and i couldnt believe how low my fathers insurance was versus mine. I thought geico would be the disrupter. Id like to hear something about them doing that. That would be great for america. Yeah. Guys, busy morning. Bicoastal squawk this morning. David is out quest. Well get his interviews from milken, including apollos chief, marc rowan. In the next hour, David Solomon and exxonmobils darren woods. 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You founded your Kayak Company because you love the ocean not spreadsheets. You need to hire. I need indeed. Indeed you do. Indeed instant match instantly delivers quality candidates matching your job description. Visit indeed. Com hire we are live from the Milken Institute global conference in los angeles. Joining me now is marc rowan, the ceo of apollo. 671 billion of assets under management. Thats the new figure from the quarter that was just reported. Its good to have you, actually, after that quarter as well, given that was, i think, thursday. Thank you, david. Marc, its good to have you. Were going to talk a lot about the private markets as we have during this annual interview that we do, but i want to start off with the old business, private equity, because you guys are in the news with paramount. I dont know how much you can share, but i would love if you could at least explain, perhaps, why apollo is partnered with sony on a potential bid to acquire paramount. Theres not a lot i can share, but private equity is all about value creation. Its about taking something and making it better. And so, you think about industries that have gone through transformation, media, which you live every day, is in the midst of an amazing transformation. The notion that two studios could potentially come together, historically, we would have thought not possible, but you think of all the new competition from streamers, from meta, from apple, and from everyone else, this market is wide open. Having scale, having the resources to produce content and to it efficiently, having multiple genres, multiple everything, its been an interesting spot for us. Were active through yahoo, active through legendary. And partnering with a strategic just brings Something Else to the table. Why do they need you . Usually, for money. But also, we have been in this industry a long time. I used to joke with people in the Cable Television business that people thought of john malone as the strategic and us as the financial, and yet you look at every business that john malones built, we built them and sold them to john. Weve been here a long time. This is, for me, my 40th year doing this and for the team, 35 years in the media business. Weve made the mistakes we need to make to pay the tuition. You know, when it comes to that potential deal, and again, who knows at this point, its not without its regulatory aspects as well, whether a foreign buyer in the form of sony, obviously, or the stations, given how many you already own. Are those potential gating issues coming to any fruition . Regulatory is an issue for every transaction, but these paths are well trodden. Sony already owns a studio. We already own tv stations. The limits and the laws are pretty straightforward. You think it would be if you could get it at the right price, then, something that would generate a good return, even in the very challenged world that we live in here in media land, marc . For us, Purchase Price matters. This is all about providing our investors excess return for unit of risk. There is nothing that is worth doing that does not provide a return to our investors. I want to get back to the conversation we have been having for some time, which makes me jealous when you talk other plays. You cant have me every day. Im glad youre here. Ive noticed, when you talk about sort of this move, public to private, it feels as though every year that i look at it, your remarks get a little more pointed. This is from the Conference Call just last week. You said, i believe we are revisiting the most fundamental concepts that underlie our Financial Markets, and then you went on to talk about all the reasons why private going from aa to public, but explain to our viewers, why are we revisiting the most fundamental concepts that underlie our Financial Markets . Take the most basic product we have in the u. S. , the largest pool of money, i believe, anywhere in the world, 401 k , 12 to 13 trillion. These are the people who need returns the most. What are they invested in . For 50 years, their invested in daily liquid stock index funds, for the most part. Why . Well, we go back, and we think about the origins of our financial system, and stocks and bonds were the two tools that people used to build portfolios. And stocks were fully diversified, 8,000 Public Companies. Bonds, again and now you look forward, and you think about 80 of companies who are over 100 million of revenues in the u. S. And europe are private, not public. Why would you exclude yourself from that much of the marketplace . And the answer is, people are not. We are revisiting the whole notion of what it means to be public, what it means to be private. Is private safe . Excuse me, is public safe and private risky . Or are both safe and risky and just offering different degrees of liquidity . Lots of places around the world have found a way to blend public and private markets on behalf of all investors. When you talk about that, you go on to say as well that you believe investors increasingly will seek out equity exposure in private markets in other forms that exist can today, and you go on to say its your job at apollo to create the products. So, what would that look like . We are talking about potentially a seismic change, and i wonder if i can access the private markets almost as easily as the public, whats the difference . I spoke at a conference, and i spoke to a group of people who are on record as being against private equity. And i reminded them that private equity is a product. Its not, in and of itself its not all equity thats private, and i tried to make a distinction in their minds between private equity, the product, and equity that is private. It started with the same logic. If 80 of the market or 80 of the companies above 100 million of revenue are private, why would you exclude yourself from that marketplace . Think about what private equity is. Private equity is a fund. Private equity uses leverage to enhance returns. They target high rates of returns, and its locked up. What if many of the characteristics of public also lived in the private market . Active management. But the difference between a Public Company and a private company may be Share Ownership and not much else. Right, well, and not access to daily liquidity, obviously, as well. When you think about, again, the investor universe, start with the 401 k , do they need access to their money on a daily basis . Do they use access to their money . Are we paying too much for access to our money on a daily basis . Then you move to institutions, many of whom have 20 to 30year time horizons. Why are big Public Institutions 80 liquid and 20 private . Because in another time, we thought of having a private bucket, because if private is risky, you want only a little bit of it. But if private is safe and risky, and public is safe and risky, shouldnt you be where the action is . What are these products going to look like . Can you give us some sense as to how you think about it . You break it into the portfolio construction. You have equity, mostly public equity. You have debt, mostly public fixed income, and then you have alternatives. Alternatives are already almost exclusively in the private marketplace. Yeah. In credit, we are watching institutions and individuals around the world begin to use their fixed Income Bucket to participate in private credit market. I always like to challenge cios. Is a private singlea rated security an alternative, or is it fixed income . That can take an hour in some places. By the way, its just fixed income. If you can earn another 150 or 200,000 basis points for the same rightingating, youre goin that. W why is it happening faster in public and credit . Investors are able to say, this is a single a, and im just dealing with liquidity. We dont have those sign posts in equity yet, but if 8,000 Public Companies go to 4,000 Public Companies and eventually go to 3,000 Public Companies, institutions around the world are going to need to find ways to participate in this market, and they may choose to participate in a product, private equity, or they may choose to participate in equity that is private. Right. But when it comes to the private credit markets, which we have been discussing, and when your firm has obviously benefitted a great deal from, there is starting to be a bit of a pushback. David solomon said a lot of the refinancing they did at goldman was refinancing private Capital Structures with more attractive pricing available in the broad base syndication m