There is a disconnect. The s p and dow moving modestly, the nasdaq off i 1. 5 . Quite a disconnect. This happened over the course of the day. It wasnt like at the beginning of the dare the beginning of the day, we saw records before a fall back. It led the way downward, down one point 5 . The s p has been pulled lower in the last 20 minutes or so. If you look at these groups within the s p 500, the divergence is even more stark. Energy shares up 2 , financials more than 1 , materials more than 1 . Information technology down 2. 5 . There is some sort of rotation going on. It is unclear what triggered it. There was a note out from Goldman Sachs saying the volatility in the largecap tech stocks that have contributed to the gains this year, that that was a reason for concern. Take a look at the nasdaq over the past week and you will see a 1 drop some of the biggest drop in about nine weeks. Much of it happening in a single day, as we see the drop today. What is also notable about todays drop is that is happening on extraordinarily high volume. Tracks the nasdaq. This is volume versus the 20 day average. The 20 day average is in blue, today is in white. We are running about 60 above that 20 day average. Down here, it does it by time of day, sort of in 15 minute increments. Come back to those stocks i was talking about, the Goldman Sachs highlighted. It has a new acronym. It includes microsoft, apple, amazon, facebook. Trading lower today, pretty sharply. There does appear to be a rotation. The last time we saw a sizable a onedayff, it was event, then we saw a bounce back. We will see what happens this time. Thanks, julie. President donald trump says he is setting up a new counsel to help speed up Infrastructure Projects. Speaking at the department of transport, trump said any federal agency that consistently wills that delays this face penalties. Spoke to Steve Schwarzman in new york. We asked him about investing in infrastructure as well as the president s relationship with china. By getting his thoughts on the apparent disconnect between the scale of assets blackstone manages, and the current stock price of the firm at this moment. The biggest disconnect for me is, we have this huge amount of money we manage for limited partners who believe we will large we will earn returns as a result of 30 years of experience and our liquid part of our stockmarket noninsiders, comprises only 5 of the total money that we manage. Partners are 19 times the size and they buy off on what we do only because we do it. Our public investors must say, i dont think that is going to happen. Sort ofgive us a lower valuation, if you will. So how can 19 times that be right . That has something to do i think with the structure of the markets, how long people hold attitudeort of their on certain types of investments. Do you see the attitude changing at all . Yes. We just did something with infrastructure that i think sort of surprised or shocked a lot of people, and they said, i have read some Research Reports where they say, my goodness, you can continue doing this in scale. If you look back 30 years, you would see that that is what has been happening. So i am hopeful that overtime, that 5 will look at sort of what we do and the care with which we do it, and basically say, why wouldnt i want to own a part of this company . I certainly do, and i have no interest in selling everything selling anything. I love what we do, ill i love our strategic positioning. We are the largest in our industry, so the size of the next three or four together. Really verylows are substantial. This is one for patients, it you just wait and people watch and eventually, they give up. And they give in . Mentioned infrastructure. Why now . Why did you decide to do that now . It is something you have played with overtime. Your peers have thought about going into infrastructure. This seems like a very meaningful entry for you. We have done 40 billion of Infrastructure Projects over the dams inanging from uganda to wind parks in mexico and in the north sea and electric plants all over the world. So we have done a bunch of this. Is i thinkhis this is a good time for infrastructure generally, is one of the few areas where the democrats and republicans seem to have an overlap, that more is better. That an asset class sorty, has suffered from of a confluence of good intentions in terms of laws, but , and policies and regulations, but altogether, it has made it almost impossible for people to build things. Example, in the United States, it can typically take 10 or 15 years to get something permitted. In germany, and canada, it is two years. It is stunning. These are real countries. This is like, g7. Arent these two of the g7 doing this in two years without any adverse environmental consequences . , is there the political will, not just at the federal level but at the state level, to do that in the United States . I think some of these roads and other types of infrastructure, getting to the point, where you are wearing out your cars early. There is a consensus that our havestructure, if you traveled abroad, which i know you have, is vastly inferior to almost any other country of a significant sort of income. And i think we were rated d by one of the big Civil Engineering firms. We are 16th in the world, and i think most people have sort of said, this is enough. We have got to invest. We have got to fix things up. So in a way, some of it is a political question. Do they have the will . That in thisis kind of Divisive Political environment, there is relatively little to rally around. This happens to be something that i think can be rallied around. You have obviously been in vited by the president on numerous issues. Do you feel as you look at the administration and the economy, that this is the thing that could get done cap could get done . Ahead of taxes and help . This was in washington into it i was in washington for two days, so i am in cosmic confusion. Nonetheless, i dont inc. It goes first for a variety i dont think it goes first for a variety of reason. But i think there is a good shot a safes a saison zone for both parties, and if they can get together and do something, that would be, i think it would be ripped well received by the country. Has been on the mind of the administration, is china, something that really, you have ofeloped expertise and a lot deep relations with, largely over the last 10 years. What do you see as the most important snow step in terms of next step in terms of u. S. China economic relations . There has been a pretty visible dialogue in terms on the tradeulty deficit. This next year, it will be close to 400 billion. It is over 50 of the total trade deficit of the United States, with over 200 countries, and in the media, it has been articulated by the president as well. Thatnk it is fair to say the chinese have heard that, and least in myze, at view, from my conversations, a bighe this is number. For a variety of reasons, the u. S. Is quite serious about addressing this, so we have to address it. July 16, there is a deadline from the meetings where there is thet to be some progress in trade area between the two countries, and they are starting to announce different things, and there will probably be more by the 16th. Then, after the 16th, i think there will be a lot of interesting things that happen, both countries are engaged, both countries want to make progress. How would you say you are feeling about u. S. China relations now versus what you were feeling 1, 2, five years ago . We are optimistic. It is hard to always measure different periods. It is easier to talk about where you are now, maralago the meetings, which were very important, because the chinese like order. Things were pretty disorderly before those meetings, and they have four different work streams, with teams from china and the u. S. Working on both of them. The relationship between President Trump and president xi is actually really good. Forget what is reported. You can get this through, in china, one of the nice things is, they are so well coordinated as opposed to our government, when one person tells you something it is basically reflecting the view of the group. When three or four tell you, then for sure, they keep minutes at every meeting and everything is circulated. The relationship between the two a really good one. Were you surprised by that . It is sort of interesting. The president likes meeting that is the way he relates to people. He invited president xi to come, which is a very high risk invitation. Leaders of Chinese Companies dont normally just show up to somebodys house is a houseguest or something. Choreographedell behindthescenes, by some of the members of the u. S. Administration and the chinese. A process. Me with so this was a process meeting, and i was there for a little fourand you had your different sort of trains in different rooms, and it sort of left the two leaders sort of sitting there, or standing there, or walking around, so in a way, the circumstances of of, weing created a bit must be with each other type of thing. We have all been in situations like that. They dont all work out well. , it did andwhere they had some pretty candid talks about different issues facing them and the world. For whatever the reason, it just which iseally gelled, important in their culture, as well. Now, there is a protection, if you will, for everybody working on something, that they know top havetwo people on some common aspirations. Feel quite good about that. Of course, the biggest issue, in a way, is north korea. You ask the question economically, but north korea is a problem for both countries. In a way, that is common ground, not divisive ground. Most people who report on this think this is some divisive issue between the two countries. In fact, that is really not the case. They both have a problem. Nobody wants the north koreans to have Nuclear Weapons that can be delivered to their doorstep, and have a lack of confidence in the liability in north korea. They would like it addressed. We are almost out of time. One of the things you said to me in the printed or view that candidly as a writer, and the other writers who have read it shook their fists at how candidly eloquent you view yourwas, life as an endless series of short stories. Which again, as a writer, i think, that is a good line. In this current short story, what is the theme . There are a lot of themes. I get so many shots on goal, if you will. I get so many emails a day now. And they all involve situations that are fascinating, or else i wouldnt get them, because i have gotten rid of most of my, you know, monday and things you eliminated the nonfascinating things in your life . Not all of them. Some i have to do, but usually, if it is a problem that reaches me, it is a goodsized one. Ort is pretty interesting, if it is something going on in a notforprofit, if you dont solve it right, it creates other issues. And on the political side, when i try and help out, if you get that wrong, you read about it on the front page. I am not in charge of all of these things, but if somebody asks me an opinion, i will give it to them. I like it to work on my way, just like everybody else, because i think it is balanced. So each one of these things is really interesting. I guess that is a bit of a theory of life, a question. Have,k it is important to everybody has their own view. There is no right answer to this kind of question for myself. I like having a full life, and i like having it in different areas. I love my business life. It is great, the firm is wonderful, our people are fantastic, our prospect are really wonderful. That is really a fulfillment of 31 years of recruiting people and being part of developing great processes and delivering for our lps and our other customers. ,he notforprofit part of life i am very fortunate. I can write checks and that is not always so fortunate, because people call all the time, but that aside, you can address issues that are really important. That was Steve Schwarzman, at theone ceo, speaking bloomberg invest summit this week. Still ahead, apples new iphone may hit a major speedbump. We will explain what inside the gadget is preventing them from reaching their potential. This is bloomberg. This is Bloomberg Markets. Iphone goes on sale later this year, the iphone eight. They may not meet the need for speed. , who covers apple, has the story from san francisco. Great to have you show on the show. Explain to us why apple will be lacking competitively potentially this year. Right now, apple uses two main chip suppliers for the modem. The component allows the iphone and other devices connected. Some of them come from qualcomm, who apple is in a legal battle with. Other items come from intel. Intels chip is slower in terms of overall capabilities, which means apple uses two chips. The qualcomm is higher performer performance, but apple doesnt want to put out the same phone that has differing versions of the top speed capabilities. They are holding the capabilities of the qualcomm chip to the intel chip. All nextgeneration iphones can operate at the same speed. Speed is onehigher gigabyte download, right . That sounds pretty fast. Make zed properly, it it could make a huge difference. Is this something consumers are asking for . Yes, absolutely. Customs customers want to be able to Download Data at faster speeds. Although this beat is theoretical, it is never really going to hit unless you are in a controlled Lab Environment at that speed. Means thetical speed phones will operate faster than the current ones. Even if the theoretical will not be easily reached, the chip is still faster. Eventually, the phones will be able to make take advantage of faster speeds. Julia i am with scarlet on this. The incremental increase in speed, the utility value doesnt all that important. Or am i just backward in the Technology State . Buying thetop people iphone eight and go to competitors, or waiting . Apple has been in this position before, where their technology is less than others and that didnt stop people from buying their products. The samsung and other new phones do have this capability, but again, it is theoretical. Will it ever reach those top speeds . That remains to be seen. Consumers will have to make the choice. It will not hold me back from wanting the iphone eight. I do not think it will hold many people back, but it remains to be seen not by the phone because of that. I dont think it will have a big impact, but the importance here is because apple is diversifying its suppliers, adding intel in the mix, it is unable to put out the top speed found it would otherwise be capable of putting out. If they went 100 with qualcomm, which they are not for a variety of reasons, they are not they would be able to do this. They are not opening up a capability because they do not want some phones to be faster than others. Scarlet mark, thank you for that perspective. Julia a look at some of the biggest business stories in the news right now. Tesla has put another bigname carmaker in its rearview mirror. Is the fourth valuable fourth most valuable automaker in the world, i had a bmw. The market cap rivals gm and boosted the market cap to 6. 16 billion. Theyk says big audio god oh companies try to kill the electric car. A request by democratic lawmakers to hand over information on operations. They mustrs say maintain confidentiality of nonpublic customersinformation. The commodities close and oil is higher today, but it is still not having a good week. That is up next. This is bloomberg. Scarlet from bloomberg headquarters, this is Bloomberg Markets commodity closing in new york. Lets start with palladium, touching its highest level since 2001. Investors are betting on tightening supply for palladium, which is used to curb harmful vehicle emissions. This is the biggest and removed for palladium since 2009. A check on oil, rebounding after a twoday decline but still headed lower for the week. Rising supplies from the u. S. And nigeria showing opec is struggling to clear a global surplus. Oil has given up most gains it made after opec members and nonmembers agreed last your to curb their output. Lets take a look at the movie and oil. The move in oil. The bars show the price change on wti crude. We have seen two declines at at least five percent, those are the big red bars on the bottom. We havent had any gains topping 5 this year. The last time that happened was in november, before the chart begins. The trend for oil this year shows the selloffs have been more intense than buying action. Julia lets get to one of our latest onstories, the the u. K. Elections as theresa may apologizes to her fellow conservatives for the devastating votes that wiped out her partys majority. Our London Bureau with the latest. This is a stunning setback for theresa may, though i noticed in the last few moments, she has hired the same cabinet ministers around her. She has a tougher job in getting anything done. This is such an embarrassment. Seven weeks ago, it was meant to be a landslide victory for conservatives, meant to strengthen her hand in brexit negotiations with the eu and strengthen her majority in the u. K. Parliament. No majority. E is she got 42 of the vote for the conservatives. Youre right, she is gathering the same dream team around her, the five ministers remaining in place, like philip hammond. She has to apologize for them, for to them come up or wiping out the majority she had before. This makes it more complex when you currently have less than you thought you had in terms of negotiating. Instead, she turned to the Northern Irish party, the du p. Toy want an easier route trade between Northern Ireland and the rest of ireland, which come i might remind you, is in the eu, so what happens to her hard brexit . Julia so you are saying this could make the brexit negotiations softer, and rules out a hard brexit scenario . Lets look at the reaction in the markets. Analysts say sterling versus the dollar could take 121 if we see a hung parliament. People are going, is this a better outcome ultimately for the brexit negotiations . Talking about the market reaction, it is phenomenal. We saw a big move in the pound. It was down 1. 9 versus the u. S. Dollar. It was the worst performer, down 1. 8 . You have to bring it into your minds eye that going into the hashtag, the pound crumbled but the yield of the guilt hardly changed. Brexit, see a softer reminding people of what hard brexit means, that would mean she wou