Apollo's Black Sees World at Milken as Dondero Dodges Trumpby , , , and
Annual gathering draws rivals Rubenstein, Black together
Steve Cohen confused by U.S. candidates; Asness flipping coin
“The bar is open. That doesn’t mean you should have five drinks.”
Josh Harris’s off-the-cuff comment summed up the sober tone of the 2016 edition of the Milken Institute Global Conference this week in Beverly Hills, California. At a time of cascading oil prices, dizzying market moves and geopolitical uncertainties, it behooves investors to be cautious, said the billionaire private equity titan, who co-founded Apollo Global Management LLC.
“Have one drink, go home, have an aspirin and go to sleep,” Harris said.
Voicing alarm wasn’t the only item on the agenda. The annual gathering of billionaire investors, heads of state and entertainment moguls affords time between panel discussions for attendees to rub elbows in the Beverly Hilton hotel’s packed lobby, to chat privately in rooms upstairs and to retire after sunset to parties at nearby hotels and mansions in the surrounding hills.
The event’s ringmaster, Mike Milken, the former Drexel Burnham Lambert junk bond king-turned-philanthropist, drew a record crowd of 3,500 to the watering hole this year.
“It’s like Davos,” said Michael Tennenbaum, the retired founder of Tennenbaum Capital Partners, referring to the annual economic forum in Switzerland that attracts a global A-list of attendees. “Only it’s closer and the weather’s nicer.”
For many it was a chance to catch up with old friends -- and even family. At the restaurant by the hotel pool, Apollo Chief Executive Officer Leon Black was enjoying a burger Monday with attorney Norm Brownstein when Tony Ressler, Ares Management LP’s billionaire CEO and Black’s brother-in-law, came in for a hug. A who’s-who of financiers continued to stop by to say hello.
“So we’ve got all the heavy hitters here,” Carlyle Group LP’s billionaire co-founder David Rubenstein said, approaching the table after chatting with J.B. Pritzker, also a billionaire. “If you sit here, you see the world,” Black replied.
“Got your jokes ready?” Leonard Green & Partners’ managing partner Jon Sokoloff asked Rubenstein, whose public appearances are now almost known as much for the 66-year-old’s quips as his market insights.
Meanwhile hedge-fund manager Ray Dalio -- worth over $14 billion, according to the Bloomberg Billionaires Index -- sipped soup across from his son Matt nearby.
Upstairs on Monday, the lobby was abuzz. Stanley McChrystal, the former top U.S. commander in Afghanistan, checked his phone while Wisconsin Governor Scott Walker strode by, headed for the restaurant. In a corner, former California Governor Gray Davis discussed job creation with another conference attendee. Also seeking out the restaurant was Eric Cantor, Moelis & Co.’s vice chairman and the former leader of the U.S. House of Representatives.
Later in the day, Revlon Inc. Chairman Ron Perelman, worth $15.6 billion, headed to the hotel’s main ballroom for a panel on global growth. In a hallway nearby, along the Hilton’s circular driveway, buyout baron Chris Flowers spoke with another attendee.
On Tuesday, billionaire Lynda Resnick spoke about focusing her philanthropic efforts on California’s Central Valley, where her healthful snacks company employs some 4,000 agricultural workers. And actress-turned-entrepreneur Jessica Alba talked about the inspiration for Honest Co., her online vendor of chemical-free diapers and beauty products.
“It really came out of my authentic consumer experience when I became a new mom,” Alba said. “I didn’t know how to get out of the house in less than an hour. These are delivered to your door.”
One topic that permeated the historic hotel’s halls all week was the upcoming U.S. presidential election. U.S. Senator Bob Corker, a Tennessee Republican who chairs the foreign-relations committee, said Republican frontrunner Donald Trump’s foreign-policy speech last week suggested a more restrained role in global affairs than most people think.
AQR Capital Management co-founder Cliff Asness, when asked which candidate he’s backing, responded, “never any of them.”
“I’m with a tremendous amount of the country in just being deeply disappointed with what are the likely two choices,” Asness said, referring to Trump and Democrat Hillary Clinton. “I’m flipping a coin.”
Billionaire trader Steve Cohen said he was “a little confused” about the candidates and hasn’t made up his mind.
Hedge funds came under attack at the conference after Cohen said he was “blown away” by the lack of skilled people in the industry and that “talent is really thin.”
While he can’t vote in the U.S., former Mexican President Vicente Fox made no secret about whom he’s supporting: “Hillary.” Trump’s protectionist trade policies are reminiscent of Herbert Hoover’s, Fox said, and could lead to another Great Depression.
“Who knows what Donald Trump stands for?” asked Cantor, who stepped down as leader of the House in 2014 before joining New York-based investment bank Moelis. “When people go to the polls in November, and if it’s between him and Hillary, she’s taking definitive stances,” while Trump changes where he stands on policies, Cantor said.
Meanwhile, at least one attendee couldn’t feel objective when thinking about Trump’s chances.
Asked which candidate he preferred, Highland Capital Management co-founder Jim Dondero responded: “Donald Trump commented on my divorce in the New York Post. So I’m not the best person to ask.”