Now theyre expected to go up to 125 or 120 to 125 but theres been little earnings improvement over the last few years. Under trumps program if he cuts taxes, dismantles regulation earnings can go to 130. The market can sell at 20 times that. Thats 2600 on the s p 500. Thats a 10 move from here. And a preview of the 2017 best picture Academy Award nominees announced yesterday. Its conflict and compromise and very very excitable. I got two girlfriends. And today we remember Mary Tylermoore who died at the age of 80. I have done television until carl reiner read with me that audition and he just heard something he wanted to hear. Politics and washington, stock market in new york and best films in hollywood and remembering mairy tylermoore when we continue. Rose funding for charlie rose has been provided by the following and by bloomberg, a provider of multimedia news and Information Services worldwide. Captioning sponsored by Rose Communications from our studios in new york city, this is charlie rose. Charlie we begin with our continuing look at President Trumps first week in order. He signed an executive order to begin construction of a border wall with mexico. Its part of the president s Signature Campaign promise to fight illegal immigration. The made an address at the department of homeland security. Were going south borders. The unprecedented surge of Illegal Migrants from Central America is harming both mexico and the United States and i believe the steps we will take starting right now will improve the safety in both of our countries. Its going to be very good for mexico. A nation without borders is not a nation. Beginning today the United States of america of america gets back its borders. The president is expect to meet with mexican president next week at the white house. Joining me from washington Julie Hirschfeld david and bob costa of the Washington Post. Its only wednesday but the president seemed to be determined to fulfill his Campaign Promises. He said he would build a wall and initiated now. Whats the difference between the initiation and the beginning of the wall being built having funds as well as mexico paying for it. Good to join you, charlie. What were seeing this week in regard to immigration is the culmination in action in terms of what the president was talking about in his inaugural address. This hardline populism he articulated has been put into policy working alongside Jeff Sessions of alabama his nominee for attorney general and steve bannon. They crafted the executive orders because they want to get started quickly in particular on the wall. Theyre using current federal funding available to them through executive authority to begin the construction project. Meanwhile theyre starting to have talks with mexico. A government that remains very resistant to the idea of funding any part of this wall but its all part of trumps ambition to get started on his immigration policies now before Congress Gets cold feet and too many things come his way. Charlie hes evidently determined to get a whole lot accomplished very early across the boards. He certainly is. And this is somewhat different for a republican president. I was at the capitol all week and Many Republican lawmakers at the house and senate are privately and publicly are telling me hes not using all the executive authority. It echos one of the criticism they made of president obama but they know trump as someone so outside of washington is working with congress and going to be at the retreat thursday but working as a loner with his staff to make sure his Campaign Promises are fulfilled and theyre not all mainstream ideas theyre trump proposals. Charlie is it steve bannon that has the most influence with him . I see a populist orbit around trump and his speech writer, steve bannon, Jeff Sessions, the deputy chief of staff that was chief of staff to sessions are long on the fringes of republicans and now they have power and having power they dont want to lose it and move on things they know make many people in their party and Many Democrats uncomfortable. Charlie julie, your assessment of whats happened in the three days of the Trump Presidency this week . What weve seen as a real activist approach putting in place unilaterally some of his Campaign Promises and what we saw with the border executive order is donald trump will try to use all his authority and everything at his disposal both to appear to be carrying out the promises in a strong way and try to prod congress to follow him. Many of the things he called for in the orders today, the building of the wall, the hiring of more Border Agents and border enforcement officials will take congressional acting and funding. Hes playing out a predicate with the Health Executive order the evening he was sworn in saying this is the direction the country is going and i want policy to go and follow me and we can get it done. Whats not clear is it if he can get these things accomplish border wall will be very costly. Were already hearing the president of mexico may cancel his trip to come to the white house and talk to donald trump about this in the coming weeks of the anger the proposal has inspired. What we see from trump say real activist posture but its unclear whether hell be able to follow that through and well have to see. Charlie tonight as we speak whos the likely Supreme Court nominee . I think judge gorsach and you have pryor close with senator sessions. Hes part of the main three. I hear its gorsach and anything relate to President Trump can chang change. Charlie senator sessions has real power he doesnt he . He does. In trump he found someone he can sell an ideology no one else but sessions was selling the populism about nationalism and trade and protectionism and tough borders. No one else was talking about these except the breitbart website and trump comes in with the whirlwind of celebrity and embrace the sessions ideology and now sessions in power can help trump turns the populist instincts into policy. Charlie theres a sense he believes he has caught a wave which is the movement which is the populist revolution around the world and that he is simply the expression of it in america. Absolutely. We heard him in his inaugural address people of the world and talking about the movement theyve built and hes just a messenger and the powers returning to the people. He can talk about the message of a populist movement and put out orders for unilateral action but what we have yet to see if hell be able to build a coalition and hell have to do that with Mitch Mcconnel and paul ryan and one thing the Supreme Court fight coming up that will allow him to do is establish channels and team up win capitol hill for getting that done. If he can do that effectively it will bode well for the policy agenda he want to execute. But right now this white house is at its very beginning stages. They dont have much of a coalitions operation. They dont even have much of a Communications Operation beyond a press secretary. They have a lot of work to do. Charlie the Washington Post had a fascinating piece i think yet, robert, you got an inside look at how it is both trump with his pen circling articles in the papers he was interested in and wanted action on or a response to. Give us your sense of his modus operandi in the white house . Trump sees disruption and tweets as power to rattle washington. Hes creating challenges in his town with his m. O. We look at the new controversy about voter fraud with tweets he mentioned monday night. Hes talking about issues beyond the policies of health care and immigration and taxes. Thats alarmed privately some lawmakers ive spoken with. They wonder why trump cant get more focus in his agenda in the first week and part of the things thats been reported about his m. O. Is hes waking up early every day and getting all the printouts about him and marking them with pen in a sharpie marker and watching television every hour and every minute and keeping his antenna up and his aides tell me thats what is does and its taking up a lot of his time and the executive orders and monitoring the media, being part of the media and giving speeches so we still see him adjusting to the office. Charlie julie is he a guy most comfortable in combat . I think hes most comfortable when hes punching back we saw that in his first full day in office when protesters were in the street and he was in the white house watching on tv and feeling very attacked and we saw him hit back and his press secretary hit back sean spicer in his appearance and hes is sitting watching tv, watching his coverage and the reason some republicans are put out by the offmessage nature of some of what hes saying is he cant resist hitting back when he sees something he think is unfair. When he hears that people saw pictures of his inauguration and it wasnt as crowded as for barack obama hell pick it up and be out in the media and be on twitter and make statements and thats not what he want to be talking about necessary or what republicans want to talk about but thats the nature of donald trump. Charlie thank you, julie, thank you, robert. Back in a moment. Stay with us. We begin with the dow jones soared above 20,000 for the first time in history wednesday afternoon and the s p and nasdaq have surged in infrastructure. Joining me bryon wien the vice chair of blackstone and Michael Regan a Senior Editor at bloomberg. Byron, ill give it to you first. Whats going on . Investors are taking trump at his word. They believe hes going to improve the economy. The economy was bumping along since the recovery began in 2009 and at less than a 2 growth rate. He promises something considerably more than that and the progrowth outline you gave delivered 3 growth and when i went to school 3 is 50 more than 2 . Most people think it will start to kick in in 2017 but youll really feel it in 2018. My view is trump is an impatient guy and hes going to press to get these changes done earlier rather than later. Charlie and will be successful . I think theyll be effective. I think theres some negatives associated with them that we can talk about. One is its going to take a lot more workers to produce 3 growth and we already have 4. 7 Unemployment Rate and two, i think the tax cuts will reduce government revenue faster than the additional income will flow and increase the tax revenue. Charlie michael. I think thats exactly right. Trump had a huge wish list of items he wanted to do and the market reacted very positively much to the surprise of people. People thought there would be more volatility because theres so much uncertainty around trump. Hes very unpredictable on purpose. Charlie most these people believe in trade and freetrade. I suppose trump does or says he does but doesnt think its fair. He started equity friendly building the pipelines and not only that saying well use american materials. Even building the wall is bullish for commodity produce ers. Ultimately its how the bond market reacts. Bonds havent broken up to the upside like they start to after the election. Its clear that trump is going to push for a bigger deficit in the u. S. So that coupled with the inflation thats going to be caused by these policies will cause upward pressure on Interest Rates charlie is that going against republican orthodoxy . Absolutely. You kind hearing animal spirits are attached to it and a certain amount of his wish list will get accomplished but march well be looking at the debt ceiling again and will the deficit hawks in congress who pushed so hard against expanding the debt ceiling in the past will they fall in line behind trump on this or will there be a little bit of friction . That to me is the next litmus test. Weve had almost a decade of incredible policy in the United States and around the world. Its like we almost forgot the reality. Charlie its kept rates low. And pumped money and stimulus into the economy. But that said, even ben bernanke was pleading with congress, guys, spend a little more. Charlie and there needed to be a fiscal response. Primarily with infrastructure or what else . Primarily with infrastructure. It will be interesting to see military spending whether he thin thinks a jet fighter should be whatever price it is. The blocked shot of the Federal Reserve and bank of england, European Central bank and bank of jp if you combine them they were 3 trillion in 2008 and theyre 13 trillion. The market has been propelled by monetary expansion. Now at least in the United States we dont have that expansion. I dont think the Federal ReserveBalance Sheet wont be shrunk but we wont have the monetary push. We need the push from earnings. Well also have Interest Rates going the wrong way. Charlie explain it because everybody doesnt work at blackstone. Explain how that comes about because of the effect and what the increase of earnings are across the board. Earning have been trapped between 115 and 120 on the standard and poors 500 for the past 15 years and now theyre expect to go to 120 to 125 but theres been little earnings improvement in the last few years. Under trumps program if he cuts taxes and dismantles regulation earnings can go to 130. The market could sell at 20 times that. Thats 2600 on the s p 500. Thats a 10 move from here. To me charlie theres still an important constituency that has to be convinced thats the boards of directors, ceos of companies around the country. For the past eight years theyve taken money in and bought back stock. Theres a ceo at herboard do they say we want to go for it . We want to spend money in ways we werent comfortable before because theres an opportunity we dont want to miss and so far the they havent really gone for it . Are they wrong . Operating rates are 77 . Theres plenty of slack capacity in the system. You dont have to go out and build a new plant. Then you may not have the same effect trump want with the reality byrons talking about. To get back to the buybacks and dividends which help the stock market a lot of that was fueled by ultra low Interest Rates. To me he hasnt even started talking about what i think is the most bullish aspect of his platform the tax cuts and the repatriation of u. S. Earnings. U. S. Companies have charlie a couple trillion . Ive seen hundreds of billions, a couple trillion. 3 trillion. Charlie that companies have overseas they have not bought back of the tax rates. Some will be used over there. Theyre not bringing it back for free they will pay some taxes. Charlie what is it now 35 . They pay around 27 . That right there is an instant adrenaline injection to the stock market. What i dont get is how much is the stock market discounting that being a done deal . Thats the easiest thing to get through to congress. Having a onetime holiday to allow i dont think thats a big push. I think the big drivers of the market are lower corporate taxes on income not on the repatriation and the dismantling of regulation. Regulation has Cost Companies an enormous amount and its hampered their operating activities. Those are the big pluses. Hes got to get those through. Charlie hell have paul ryans support on that for sure . Paul ryan will support him but hes a deficit hawk. He wants whatever Program Trump implements he want to be revenue neutral. You cut taxes on corporations and individuals youll have to find other ways to generate revenue to have a balanced budget or something approaching charlie whats that have to do with regulation . It costs companies money. If they make more money theyll pay more taxes. Can i paint a more bearish case to byrons view of ceos ive met in the past weeks theyre excited about what michael is talking about but theres a creeping fear which is rule by fiat may affect their decision and border adjustability if you want to get really boring we can go into that and its a way of putting tariff on goods that come in charlie and a trade war is a product of that . Richard haas is so he will went on that. Who are people buying u. S. Products . People in mexico. We send energy, natural gas and oil to mexico. Theres all sorts of things we havent begun to explore if we break into reduction of the free trade regime. And the Profit Margins on u. S. Companies china will be a big part of it and we have europe with its own problems and brexit is a part of that and we have our populist wave sweeping over the world. You may see some elections going the wrong way charlie like germany, italy, france. It makes europe which is an important customer of ours a wild card. Charlie and an important customer of china too. The whole postwar dynamic like a rebate you become our preferred trading partner well cut you slack on nato and pay for your defense. That was the implicit bargain and what trumps inauguration speech said all deals are back on the table. America first and perhaps china makes a better accommodation with europe than the u. S. Has. Thank you. Charlie thank you. Well be right back. Stay with us. The nomination for the 89th Academy Awards were announced yesterday. Jimmy kimmel will host sunday february 26. The musical la la land leads with 14 nominations including best picture, best director and actress and director and moonlight and arrival were also widely recognized with eight nominations each. Heres a look at the nine films nominated this year for best pi