Blackstone’s Steve Schwarzman & House Minority Leader Jeffries 12/18/25

0:00Bring in show music, please. This is Squawk Pod, and I'm CNBC producer Cameron Costa. On today's episode, 40 years of Blackstone. The world's largest alternative asset manager is not slowing down, and neither is its CEO and co-founder, Steve Schwarzman. We never stop innovating. We never stop pushing. We always believe that we have smart competitors. His view on the Federal Reserve's rate cut agenda and on China after four years of chilly relations. Both China and the U.S. have looked at that and said we really have to lower the temperature. This is not functional for us as countries or for the world.

0:45On the Hill, the health care debate is heated. Republicans breaking with the GOP, a push to vote on extending Obamacare subsidies. House Minority Leader Hakeem Jeffries gets into it all. We've got the votes to pass a straightforward extension and send it over to the Senate. Mike Johnson needs to make sure we vote on this legislation today. The House should not recess or adjourn until this issue has been dealt with. Plus, our takeaways from President Trump's address. Trump Media is merging with a fusion power company. And middle school memes have made their way into business. Do you even know what 6-7 means?

1:26Well, apparently it kind of doesn't really mean much. Doesn't mean anything. It's like very obscure origins. See, I thought 6.7 was like meh. It's December 18th, 2025, and Squawk Pod begins right now. Stand Becky by in 3, 2, 1. Cue it, please. Good morning, everybody. Welcome to Squawk Box right here on CNBC. We are live from the NASDAQ market site in Times Square. I'm Becky Quick along with Andrew Ross Sorkin. Joe is out today.

1:58The price of eggs is down 82 % since March, and everything else is falling rapidly. And it's not done yet. But boy, are we making progress. Nobody can believe what's going on. Here are just some of the efforts that we have underway. You will see in your wallets and bank accounts in the new year. President Trump seeking to defend his economic record in a primetime speech to the nation. In a roughly 18-minute address from the White House late last night, the president blamed Democrats for economic challenges and stressed that his policies are working. As the U.S. approaches its 250th anniversary, the president announced bonus checks for members of the military totaling$1 ,776 each.

2:44The president also previewed his upcoming decision on who he wants to lead the Federal Reserve. I'll soon announce our next chairman of the Federal Reserve, someone who believes in lower interest rates by a lot and mortgage payments will be coming down even further. Affordability, obviously a big issue with the president beginning his speech by saying 11 months ago, I inherited a mess and I'm fixing it. Obviously, a lot going on, not just there, but also with what we've been seeing with health care costs. That's expected to be a big issue in the election. And yesterday, four Republicans voted with the Democrats to bring up a bill to bring up a vote to the floor on health care costs, which is where we're going next.

3:27because four centrist House Republicans joining with Democrats to force that vote on extending enhanced government health subsidies for three years. Three GOP lawmakers from Pennsylvania and Congressman Mike Lawler from New York signing into a petition, onto that petition from House Democratic Leader Hakeem Jeffries, bringing the number of yes votes to 218. That means the House will have to vote on extending the Affordable Care Act subsidies as soon as next month, though they'll still expire at the end of this year, absent some kind of deal. Before then, also yesterday, House Republicans passing a health care package without subsidies.

4:02And we get the latest on all of this when House Minority Leader Hakeem Jeffries joins us live. OpenAI has held early talks with investors about raising money at a$750 billion valuation. That's according to a report in The Information. It said the maker of ChatGPT could raise as much as$100 billion in this next funding round. A$750 billion valuation would represent a 50 % jump from OpenAI's reported$500 billion valuation back in October. That followed a deal in which current and former employees sold more than$6 billion worth of stock. What do you think of that valuation? I mean, look, if you keep going up, I think it'll be a trillion dollars by the time.

4:46They actually go public? By the time you get to public, which, by the way, gets to the other question, which is, do you want these companies to be public earlier? To be private for so long. To be private for so long, or do you want them to be public earlier? And what we don't know is if you do believe we're in some kind of bubble, then maybe you don't want them to be public earlier. Shares of Instacart falling this morning. They're off by about 6.6 percent. That's coming after a Reuters report says that the FTC is investigating the company's pricing practices. Last week, a study showed that prices for the same products in the same supermarkets could vary around 7 percent because of an AI pricing tool that it is allowing retailers to use.

5:32The company declined to comment on the investigation, but said that reporting has mischaracterized its pricing system. But again, shares off by about 6.6 percent this morning. What do you think of this one? I mean, it looks like it was done as a test, or at least they're saying it was done as. I can't say anything other than the reporting that I've read on this. But it also sounds kind of similar to what airlines do, where you search for a ticket maybe once or twice, and then they know that they want it, that you really want it, and prices shoot up pretty significantly. Oh, my understanding, I hope, I hope this is right.

6:08Maybe I'm wrong. My understanding on the airlines was always a yield-oriented situation, so that if there were, obviously, the more seats that are sold and the less seats that are left, it's a supply-demand situation. That I understand, but I think this was something where there have been more recent reporting that suggests that if you search it even once or twice, it knows that— That the airline does. Yeah, that the airline knows that you are in the market for it. That one's new to me, too. And as a result, they may raise the price. So if you're ready to book, you better book immediately rather than come back and search again.

6:40That I did not know. Yeah. But, you know, look, for grocery prices, too, I can see where the FTC would get a little concerned about this. If you feel like you're not getting the best deal, I can understand the retailer's perspective of I want to squeeze as much as I can out of somebody who's willing to pay more. But we'll see. We'll see how this goes from there. And it's, again, the ability to use AI and then what you do with it are big questions around some of those things. By the way, I'm fine with the sort of supply and demand. There's less seats. There's less tax seats. Right. Right. Uber on New Year's Eve.

7:13You're going to pay a lot more money for it. And maybe I'd be OK with it if there was, you know, one last jug of milk. I don't think it's that. But I don't think that's what we're talking about here. Right. That's what I was going to say. It's not a supply and demand issue. I don't think it's a supply and demand issue. But I'm saying maybe if it was under that umbrella, I don't know. Meantime, the economic. I mean, that's price gouging, right? Like at a hurricane, you get the last case of water during a hurricane situation. Sure. But then you'd also say that airlines are price gouging and that Uber is price gouging.

7:44Yeah. Becky's going to be with us again in just a moment. She's making her way over to Blackstone's headquarters right here in New York for a big interview with that company's CEO and co-founder Steve Schwartzman. And the legend that is, she'll be joining us a little bit later in the hour with that conversation with Steve. Mike Santoli is joining us as well. Meantime, we've got some deal news. And this one's interesting. I think we're all still scratching our heads a little bit trying to make sense of it. The Trump Media and Technology Group announcing plans to merge with TAE Technologies. It's a fusion-powered company.

8:17It is backed by Alphabet's Google and Chevron. And it's an all-stock merger valued at more than$6 billion. And upon closing, Trump Media will be a holding company for its current portfolio of media brands, including Truth Social, and then as well as the power brands owned by TAE. So you're looking at sort of a conglomerate of sorts. I think there's an argument you made that to the extent you think that Truth Social or Trump media stock was overvalued, here's an opportunity for them to use that stock to buy another company, a private company, sort of a Trojan horse, to take that company public in some ways.

8:54I mean, I would think of it as, first of all, Trump media has also kind of, you know, sort of pivoted toward crypto and said they're going to do payments and asset management, other things. It seems to me this is exactly the type of alternative energy play that has excited parts of this market, right? It's the nuclear reactors in space, all this other stuff that, you know, you get this kind of pie in the sky type of potential energy source. Not a lot of fundamentals, if any, right now. And it makes for a perfect way to harness some of that investor energy and kind of change the character of the stock and the story behind it.

9:29Right. So it's a shift. Yeah. We're going to probably have to do some digging to understand more of some of the personalities behind it, why they would do this. Why this particular one? Well, the other flip side is if this company has so much promise, backed by Google, backed by Chevron, why go public this way? I mean, why not go public on your own? Well, six billion in shares that are now up 28%. That's the question. Is that the answer? And by the way, do they stay there? Yeah. It's an interesting approach. Many questions, for sure. You bet. Okay, meantime, Southwest Airlines jumping in on the 6-7 trend.

10:05And when I say 6-7, for those who have kids, 6-7. You know about the 6-7. The airline offering$67 basic economy fares on select Tuesday and Wednesday flights between January 6th and March 4th, calling it the trendiest sale ever. The deal running through December 18th applies only to flights within the continental U.S. So 6-7. I have children who say this to me all the time. Yeah. We're a little past that. Do you know about this? I know about it, but I'm a little beyond it. Do you even know what 6-7 means? Well, apparently it kind of doesn't really mean much. It doesn't mean anything. It's like very obscure origins.

10:43See, I thought 6-7 was like meh. Right. Sort of because between 6 and 7 would be like a 65. Right. And that would be sort of like... Mediocre. Mediocre. Meh. 6-7. But apparently I'm told that is not the case. Right. Right. The meaninglessness is the point in a way. I think it's just viral stuff. But I mean, once the companies start to seize on it, you have to imagine it's running its course among the kids. It's late. Teas will be next. Next on Squawk Pod, inside the heated healthcare debate on Capitol Hill with House Minority Leader Hakeem Jeffries. Tens of millions of Americans are going to experience skyrocketing health insurance premiums, in some cases increasing by$1 ,000 or$2 ,000 per month.

11:28And 90 % of the people who rely on the Affordable Care Act tax credits make around$63 ,000 per year. We'll be right back.

11:43Welcome back to Squawk Pod. While Becky traveled to Blackstone from our set this morning, Andrew Ross Sorkin and Mike Santoli held down the fort in Times Square, the morning after President Trump addressed the nation. I'm also taking on the gigantic health insurance companies that have gotten rich on billions of dollars of money that should go directly to the people. The money should go to the people. That's you. So they can buy their own health insurance, which will give far better benefits at much lower costs. In Congress, the health care debate is heated. You know by now that Obamacare subsidies expire on December 31st.

12:22and four House Republicans broke with their own party this week to force a vote on extending enhanced government health care subsidies for three years. But because of the holiday recess and because of House rules, the earliest they can vote is the first week of January. That is, unless House Speaker Mike Johnson bumps it sooner. Those four centrist Republicans who supported extending the health care subsidies, they did so by signing a petition, the Minority Leader's Petition. Joining us right now is House Minority Leader Hakeem Jeffries. Good morning to you. You heard the president last night.

12:56He says the Democrats are in the pockets of the insurance companies and that the price of your health care is actually going to go down under his plan. What say you? Well, good morning. Great to be with you. The Republican health care crisis is devastating the American people, and Donald Trump has zero credibility on the issue of health care. This is the party that has enacted the largest cut to Medicaid in American history in the same bill where they enacted massive tax breaks for their billionaire donors because of Republican policies in the one big ugly bill. We know that hospitals, nursing homes, and community-based health centers are closing all across the country, including in rural America.

13:35Republicans have launched an all-out assault on the Centers for Disease Control, the National Institute of Health, the Food and Drug Administration, on vaccine availability for children, and now Republicans are refusing to extend the Affordable Care Act tax credits. which means that tens of millions of Americans, working class Americans, are about to experience dramatically increased health insurance premiums. We are working hard to decisively confront this Republican health care crisis and fix our broken health care system. Leader, let me ask you this. And I recognize the complications and costs to the American public.

14:14There is a question, and maybe you'd say it's a longer term question that has to be dealt with later, But the true question ultimately underneath all this is how we're going to actually lower the costs of health care in America. And when I say lower the cost, not just lower the cost for individuals, meaning in the moment, subsidize it, but how we actually change the market dynamic at play and whether what you have proposed even tries to address that at all or frankly exacerbates it. What we've proposed at the moment relates to the fact that the Affordable Care Act tax credits are going to expire on December 31st.

14:51And no one disputes that if that happens, tens of millions of Americans are going to experience skyrocketing health insurance premiums, in some cases, increasing by$1 ,000 or$2 ,000 per month. And 90 % of the people who rely on the Affordable Care Act tax credits make around$63 ,000 per year. These are working class Americans, everyday Americans and middle class Americans. And so we've got to make sure that we don't allow these tax credits to expire. At the same time, you raise a very good point, Andrew, that the health care system is broken and we need to fix it. We want to fix it in a comprehensive way, in a bipartisan way.

15:32But that actually requires Republicans deciding to abandon their my way or the highway approach to everything, which is what has led to the extremism that they're jamming down the throat to the American people and the fact that everyday Americans voters are rejecting that extremism, as we saw in the off year elections last November. Leader Jeffries, you mentioned that the vast majority of those who use the supplemental subsidies for the ACA are, you know, well below, you know, kind of the wealthy thresholds that the Republicans are talking about, which is four times the poverty line. Is that in play in terms of a negotiated agreement here?

16:13They keep talking about that as maybe a sticking point. How does your party feel about simply having an income cap for these subsidies? We have a bipartisan coalition right now that supports in the House of Representatives, that's every single House Democrat and at least four House Republicans, supports a straightforward extension of the Affordable Care Act tax credits. Time has run out. Republicans have had all year to deal with this issue and have chosen not to do it because they were focused on passing their one big ugly bill, which they enacted with great urgency months ago. the largest cut to Medicaid in American history, the largest cut to nutritional assistance in American history.

16:54They literally ripped$186 billion away from SNAP. That's food from hungry children, hungry veterans, and hungry seniors. And why did they do all of that? So they can enact massive tax breaks that they made permanent for their billionaire donors and skyrocketed the debt by over$3 trillion. And now, at the 11th hour, time has run out. And we've got the votes to pass a straightforward extension and send it over to the Senate. Mike Johnson needs to make sure we vote on this legislation today. The House should not recess or adjourn until this issue has been dealt with. What is your expectation? You say you have the votes.

17:35You'd mentioned the four Republicans that have come on over to join you. And then the Senate seems like it's kind of a no go no matter what. So I mean, what are we looking at come next week? Well, what's interesting about the Senate is that there are a majority of U.S. senators, Democrats and Republicans, who've already supported in the vote that took place a few weeks ago, a straightforward extension of the Affordable Care Act tax credits. And so once we send the bill from the House over to the Senate, then the Senate can negotiate a path forward that enables them, hopefully, to break the filibuster and get something done for the American people.

18:14We can work on this issue in a bipartisan way, as has now been demonstrated in the House of Representatives. We do need some presidential leadership. Part of the issue is that Donald Trump still seems to believe that the affordability crisis is a hoax. In fact, he's said that repeatedly. Costs haven't gone down in this country. Costs have gone up, despite the fact that Donald Trump did promise his words, not mine, that costs would go down on day one. Housing costs out of control, grocery costs out of control, electricity bills out of control, health care costs out of control. Action needs to be taken in all of these areas.

18:49We're prepared to work with our colleagues on the other side of the aisle. We just need good faith and Republican leadership. Talk about costs getting out of control. You mentioned health care. Interestingly, you look at employment in America over the past year, And actually, it is the health care industry where so much of the employment has come from. What do you make of that? Well, listen, I think we've got to take a look at the economy as a whole and all of the individual sectors in this country. Fundamentally, here's our belief. You work hard. You play by the rules. You should be able to live an affordable life, a comfortable life, live the good life.

19:25And to me, that's good paying job, good housing, good health care, good education and a good retirement, which means the extremists need to keep their hands off Social Security and Medicare. That should not be too much to ask for in this great country of ours, the wealthiest country in the history of the world. So, you know, listen, we support the notion that economic growth that moves in a positive direction is good for everyone. But we've got to make sure that this fundamental principle, hard work paying off, playing by the rules, paying off, And the American dream being brought to life is actually realized and revived because far too many people understandably have concluded.

20:08I'm talking about working class folks, middle class folks, that the American dream is out of reach as we approach our 250th birthday. That's a shame. A lot of folks waiting to find out what the Supreme Court has to say about the tariffs that have been implemented by the president. I believe you have come out strongly against those tariffs. There's a real question, though, about whether if they were struck down, whether the court could force effectively the U.S. government to give back the$200 billion that has been collected in tariffs and how that could re-scramble the economy. And I'm curious what the sort of democratic position would be on something like that.

20:49Well, the implications of the Supreme Court striking down those tariffs, I think, have to be evaluated. Our view, as you indicated, Andrew, from the very beginning, is that the president has violated his authority. He doesn't have the emergency authority to implement this random, massive tariff scheme that's imposing thousands of dollars of additional cost on everyday Americans, which is why the American people reject these tariffs. I think that if the Supreme Court strikes down these tariffs, then Congress should come together in a bipartisan way and figure out the path forward. anchored in the reality is what's best for the American people, what's best for our companies and our corporations, what's best for the economy to ensure that we can continue to see American exceptionalism prevail.

21:36Leader Jeffries, I want to thank you for joining us this morning. I want to wish you happy holidays if we don't see you before the break next week. Thank you. Happy holidays. Thank you. Coming up on SquawkPod, we're at the offices of the world's largest alternative asset manager, Blackstone, with CEO and co-founder Steve Schwarzman, the Fed, China, and of course, AI. This is not bubble-type work. This is extremely conservative. Now, the whole field is exploding with growth, so there are new people entering. There are some people whose credits aren't as robust, and so you'll have some problems.

22:13like you always do at this type of thing.

22:22You're listening to Squawk Pod. Here's Becky Quick. Welcome back to Squawk Box, everybody. I am here at Blackstone's headquarters on Park Avenue in Manhattan this morning. Of course, this is the world's largest alternative asset manager, and it's just turned 40 years old in 2025. Joining us right now with a look back and a look ahead is the firm's CEO, chairman and co-founder, Steve Schwarzman. And Steve, thank you for taking the time to sit down with us. Well, it's fun for me. It is fun for us, too. We don't get the chance to do this very often. 40 years since you built this firm, coming out with$400 ,000 in capital, where you sat down and kind of branched out into this new and fledgling private equity world that you helped build.

23:05What do you think 40 years later with a market cap of, what is it, just about$187 billion today? Well, it's been 240 at the top. So that's been quite a journey. And it's been fascinating. Like all entrepreneurial types of enterprises, you don't know quite where you're going. But when we started, we knew we'd be doing private equity. We called it LBOs. And we also knew, besides our advisory business, that we'd be starting new businesses. That was part of our strategic plan. And we were going to go into new money management areas that we thought would be great for customers, that we also thought we could build into very big businesses.

23:52And we've been following the same strategy ever since. It's different than almost everyone else who just said, I'll do LBOs, I'll do private equity. because I always worried that if you stay in one business, if anything goes wrong with it, then that's not so good. So I like the idea of doing new things. I actually find it fascinating and it ends up being a great business strategy because the people who work here don't have glass ceilings. We're always doing something new. They can move to those businesses. So it's great for people retention and satisfaction. It's great for customers. And now we have such a broad platform that when we talk to an institutional investor, for example, it's really like we can bring you a solution for almost anything you want.

24:47We have 85 strategies now. We started with one. Now, it sounds like a lot, and we have almost edging up on$1.3 trillion from 400 ,000. From the assets that you were holding. Right. It happens quite gradually. Those are like two new products a year in 40 years. So it sounds like we're doing a lot, but we're extremely careful that we only do stuff that's great for customers, great for performance. And if we can do that, they become very happy and they give us more money. One of your newer businesses that you announced last year you would like to be the biggest in is being an owner of data centers.