WHEN: Today, Friday, May 2nd
WHERE: CNBC's "Squawk Box"
Following are excerpts from the unofficial transcript of a CNBC interview with former New York City Mayor Michael Bloomberg. Following are links to the interview at CNBC.com: http://video.cnbc.com/gallery/?video=3000272046, http://video.cnbc.com/gallery/?video=3000272059 and http://video.cnbc.com/gallery/?video=3000272075.
All references must be sourced to CNBC.
BLOOMBERG ON STARTING BLOOMBERG LP
ANDREW ROSS SORKIN: CONGRATULATIONS ON BEING PART OF THE CNBC 25.
MICHAEL BLOOMBERG: I'M HONORED.
SORKIN: TO THINK ABOUT THE INFLECTION POINT OF WHEN YOU STARTED BLOOMBERG LP, WHAT YOU THOUGHT IT WOULD BE TODAY.
BLOOMBERG: I DON'T THINK ANYBODY THAT STARTS A COMPANY REALLY HAS TIME TO THINK ABOUT THAT BECAUSE AT THE BEGINNING, THE QUESTION IS CAN YOU MAKE THE PAYROLL NEXT WEEK? WILL ANYBODY BUY YOUR PRODUCT? HOW DO YOU FIND A LAWYER AND AN ACCOUNTANT? AND CAN YOU AFFORD THE RENT? SHOULD YOU TAKE A BIG ENOUGH PLACE FOR GROWTH OR SOMETHING YOU CAN AFFORD NOW? I SUPPOSE PEOPLE HAVE WALTER MITTY DREAMS OF SOME DAY IT WILL BE A BIG EMPIRE. BUT I DON'T REALLY REMEMBER DOING THAT. I NEVER – PEOPLE KEEP SAYING, "DO YOU MISS BEING MAYOR?" I DON'T THINK BACK AND I DON'T FANTASIZE FOR THE FUTURE. TOMORROW IS GOING TO BE THE BEST DAY OF MY LIFE. I KNOW IT. I'VE ALWAYS BELIEVED THAT. BUT I DON'T THINK ABOUT THE DAY AFTER TOMORROW.
BLOOMBERG ON JOURNALISM IN CHINA
SORKIN: OVER THE PAST YEAR THERE HAVE BEEN QUESTIONS ABOUT THE JOURNALISM GOING ON IN CHINA. AND WHETHER THE COMPANY IN ITS EFFORT TO GROW HAS MUZZLED SOME OF THE ANTI GOVERNMENT CONTROL.
BLOOMBERG: I WOULD STAND UP FOR THE QUALITY OF – I HAVE ALWAYS BEEN PHENOMENALLY PROUD OF THE JOB MATT WINKLER AND THE – I THINK WE HAVE 2,300 OR 2,500 – JOURNALISTS DO. IN CHINA, THEY HAVE RULES ABOUT WHAT YOU CAN PUBLISH. WE FOLLOW THOSE RULES. IF YOU DON'T FOLLOW THE RULES, YOU'RE NOT IN THE COUNTRY. IN EVERY NEWSPAPER OR NEWS ORGANIZATION AND TELELVISION STATION AND COMPUTER SYSTEM FOLLOW THE RULES. AND IF YOU ARE IN LONDON – IN ENGLAND – THERE ARE A DIFFERENT SET OF RULES. YOU FOR EXAMPLE, CAN'T REPORT ON AN ONGOING TRIAL IN LONDON. THAT IS WHAT IT IS. THAT DOESN'T MEAN THAT HAS ANYTHING TO DO WITH WHAT WE WRITE. WE WRITE THE STORIES THAT WE THINK ARE INTERESTING AND WE DISTRIBUTE THEM WHERE THEY ARE ALLOWED TO BE DISTRIBUTED.
BLOOMBERG ON GREATEST BUSINESS CHALLENGES
I HATE IT WHEN PEOPLE LEAVE BECAUSE YOU ARE LOSING THE INVESTMENT IN THEM AND THEIR TALENTS. AND IF I THOUGHT – THEY WERE THERE BECAUSE I THOUGHT THEY WERE GOOD, BUT SOMETIMES PEOPLE DECIDE TO HAVE OTHER CAREERS AND GO OFF. I THINK NEPITISM IS A TERRIBLE IDEA. SO MY KIDS CAN'T WORK IN THE FOUNDATION WHERE WE ARE NOW OR IN THE COMPANY. THEY ARE TRUSTEES OF THE FOUNDATION – BOARD MEMBERS – BUT THEY CAN'T WORK HERE. SAME THING IN THE COMPANY. WE GIVE EMPLOYEES' SONS AND DAUGHTERS A SUMMER JOB IF THEY WANT ONCE. AND I THINK THERE'S A LOTTERY BECAUSE WE HAVE SO MANY PEOPLE NOW. BUT I'M A BIG BELIEVER THAT ORGANIZATIONS ARE FAMILY. AND YOU CAN'T BE PERFECT AND SOMETIMES YOU MAKE MISTAKES, BUT WE HAVE TO MAKE SURE THAT PEOPLE UNDERSTAND IF THEY DEVOTE THEMSELVES TO THE GOOD OF – EITHER IT IS THE CITY GOVERNMENT WHERE I WORKED, OR THIS COMPANY, OR THE FOUNDATION, OR WHATEVER – IT IS A TWO-WAY STREET. WE HAVE TO TAKE CARE THEM.
BLOOMBERG ON THE PERCEPTION OF WALL STREET
I THINK THAT THERE ARE TOO MANY EVENTS THAT HAVE TAKEN PLACE. WHERE CLEARLY PEOPLE ARE BREAKING THE LAW, WHERE PEOPLE WERE NOT LOOKING OUT FOR THEIR CUSTOMERS BEST INTERESTS, WHERE THERE WERE CORRUPTION SCANDAL, THEFT, WHATEVER. BUT GENERALLY SPEAKING, IN THE AGGREGATE, PEOPLE THAT WORK ON WALL STREET ARE AS GOOD AS PEOPLE THAT WORK ANY PLACE ELSE. IF IT WASN'T FOR WALL STREET – MEANING COMMERCIAL BANKS, INVESTMENT BANKS AND EVERYTHING – WE WOULD NOT HAVE AN ECONOMY. YOU'VE GOT TO REMEMBER THAT THE AVERAGE PERSON THAT WORKS ON WALL STREET MAKES $70,000 A YEAR AND LIVES ON MAIN STREET AND SHOPS ON MAIN STREET. WE ARE ALL IN THIS TOGETHER. AND I THINK MOST OF THESE – WHERE WE PILE ON AND BLAME THE CEO FOR SOME OF THESE THINGS – YEAH, IN RETROSPECT I'M SURE THEY LOOK BACK AND I SAY I WISH I HAD CAUGHT THAT THING BEFORE SOMEBODY WAS TAKING ADVANTAGE OF US, OR JUST DOING SOMETHING WRONG. BUT THESE ORGANIZATIONS ARE VERY BIG, THE WORLD IS PHENOMENIALLY COMPLEX TODAY AND YOU CAN SAY, "WELL WE HAVE TO SIMPLIFY IT." YOU CAN'T.
BLOOMBERG ON INCOME INEQUALITY
SORKIN: THEN WHAT DO YOU MAKE ABOUT THE LARGER SORT OF DEBATE TODAY ABOUT INEQUALITY AND FRANKLY, CAPITALISM, AS A BUSINESSMAN?
BLOOMBERG: WELL, ONE OF THE THINGS YOU ARE SEEING HERE IS THE EFFECT OF THE FEDERAL RESERVE BANK PUMPING A LOT OF MONEY INTO THE SYSTEM. I DON'T KNOW WHETHER IT HAS CREATED A LOT OF JOBS. IT HAS PROBABLY CREATED SOME, BUT NOT A DRAMATIC NUMBER. BUT WHAT IT HAS DONE IS IT HAS INFLATED ASSET VALUES. AND ASSETS ARE HELD BY THE AVERAGE PERSON, THROUGH THEIR PENSION FUND, OR THE WEALTHY, BECAUSE THEY HAVE THE MONEY TO OWN ASSETS. AND SO THAT HAS EXACERBATED THE RICH/POOR, TOP 20 PERCENT/BOTTOM 20 PERCENT GAP. THE ISSUE HERE IS WHAT DO YOU DO ABOUT IT? AND TAKING IT AWAY FROM THE TOP AND GIVING IT TO THE BOTTOM HAS BEEN SHOWN IN HISTORY NOT THE BE – THINK OF THE U.S.S.R. THAT DOESN'T WORK. WHAT YOU HAVE TO DO IS MAKE SURE EVERYBODY HAS AN OPPORTUNITY TO DO IT AND THEN YOU'VE GOT TO MAKE THE FUNDAMENTAL DECISION – DO YOU THINK IT SHOULD BE EQUAL OPPORTUNITY FOR EVERYBODY OR EQUAL RESULTS? AND THAT IS REALLY THE DIFFERENCE BETWEEN THOSE THAT – THE POPULUS, WHO THINK IT SHOULD BE EQUAL RESULTS. THEY WOULD ARGUE IF THE RESULTS AREN'T EQUAL, THE OPPORTUNITY WASN'T EQUAL. OR THOSE THAT THINK, YOU KNOW, THERE IS SOME LUCK INVOLVED AND EVERYTHING. BUT YOU'RE DEALT A SET OF CARDS AND YOU HAVE TO PLAY THEM AND SOMETIMES YOU'LL WIN AND SOMETIMES YOU LOSE, BUT AT LEAST YOU ARE IN CHARGE OF YOUR OWN DESTINY.
BLOOMBERG ON THE SYSTEM NOT BEING RIGGED
SORKIN: ONE OF THE THINGS BLOOMBERG LP DID SO WELL WAS BRING TRANSPARENCY TO THE MARKET. BRING INFORMATION TO THE MARKET. WHAT DO YOU MAKE OF THE DEBATE GOING ON AROUND HIGH FREQUENCY TRADING AND THE ARGUMENT THAT MICHAEL LEWIS HAS MADE THAT THE SYSTEM IS RIGGED.
BLOOMBERG: WELL, THE SYSTEM ISN'T RIGGED. AND THERE IS ALWAYS ABUSES AND I'M SURE SOMEBODY WITH A COMPUTER IS HACKING INTO THE COMPUTER SYSTEM RIGHT NOW AND SOMEBODY ELSE IS TRYING TO TRADE AGAINST – GET AN EDGE ON TRADING AND THAT SORT OF THING. THE WORLD SHOULD BE MEASURED IN THE FOLLOWING WAYS. THE SPREAD BETWEEN BID AND ASK AND THE COMMISSIONS CHARGE TO DO A TRANSACTION ARE SO DRAMATICALLY SMALLER TODAY – THEY ARE MEASURED IN THOUSANDS OF A PENNY SOMETIMES – COMPARED TO WHEN I WAS IN THE SECURITIES BUSINESS IN 1966 ON A $50 TRADE THERE WOULD BE A $1.50 COMMISSION SPREAD AND THAT IS ALL GONE. THE PUBLIC IS BETTER SERVED BY IT. AND IF YOU WANT TO MAKE SURE YOU GET THE BEST PRICE TODAY – IF YOU WANT TO, FOR EXAMPLE, SELL 1,000 SHARES OF IBM, THERE ARE 30 DIFFERENT EXCHANGES AND DARK POOLS THAT LIST IBM.
SORKIN: I WOULD THINK THAT YOU WOULD BE AGAINST –
BLOOMBERG: YOU'VE GOT TO GO TO EVERY ONE OF THEM. ONLY A COMPUTER CAN DO THAT.
SORKIN: I WOULD THINK YOU MIGHT BE AGAINST DARK POOLS GIVEN THE TRANSPARENCY ISSUE THOUGH, NO?
BLOOMBERG: NO, BECAUSE YOU DON'T HAVE TO TRADE THERE. YOU AS AN INVESTOR DON'T HAVE TO TELL EVERYBODY WHAT YOU WANT TO DO. YOU CAN SIT THERE AND SAY, "I'M NOT GOING TO TELL THEM THAT I'M GOING TO SELL MY STOCK. IF SOMEBODY COMES TO ME WITH A BID, MAYBE I'LL HIT IT, MAYBE I WON'T." THE OTHER PERSON DOESN'T HAVE THE RIGHT TO KNOW THAT. IF YOU ARE MAKING AN OFFERING, HOWEVER, YOU SHOULD MAKE IT TO EVERYONE. AND DARK POOLS DON'T WORK THAT WAY. DARK POOLS YOU COME IN AND YOU SAY, "I WANT TO DO SOMETHING AND SEE IF THE OTHER SIDE IS THERE."
BLOOMBERG ON BEING BACK AT WORK
SORKIN: FINAL QUESTION. YOU LIKE BEING BACK AT WORK?
BLOOMBERG: I LOVE IT. IT'S FASCINATING. I'M SO PROUD OF WHAT I'VE BUILT AND ALL THE OTHER PEOPLE BEHIND – MORE THAN 12 YEARS AGO AND PARTICULARLY IN THE LAST 12 YEARS – PETER GRAUER, DAN DOCTOROFF HAVE TAKEN THE COMPANY, ALONG WITH ALL THE 16,000 PEOPLE AND MADE IT BETTER THAN EVER.
SORKIN: WHAT HAPPENS TO IT? IS THAT A COMPANY YOU ULTIMATELY SELL? IS IT A COMPANY THAT GOES PUBLIC?
BLOOMBERG: NO, NO. I'VE SAID EVENTUALLY IT BECOMES THE PROPERTY OF THE FOUNDATION. EVERYTHING I HAVE IS GOING TO GO TO THE BLOOMBERG PHILANTHROPIES OR DIRECTLY TO THINGS THAT I CARE ABOUT – CLIMATE CHANGE, AND THE ARTS, AND PUBLIC HEALTH, AND JOHNS HOPKINS AND OTHER EDUCATIONAL INSTITUTIONS. AND ONE OF THE THINGS THAT PETER GRAUER ALWAYS SAYS IS, "WHERE ELSE CAN YOU GO TO WORK FOR A COMPANY WHERE 100% OF THE PROFITS GO TO CHARITY."
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