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Blackstone's Steve Schwarzman tips his hat to Obama

·Editor in Chief

Stephen Schwarzman, CEO and co-founder of Wall Street giant Blackstone Group (BX), is pooh-poohing recent weak GDP numbers. “The U.S. is doing fine,” he tells Yahoo Finance in a recent interview. “It seems we always have odd announcements from the U.S. government in the first quarter. According to them, it was two-tenths of 1% growth [in Q1 this year.] The previous year, which we thought was completely ridiculous, they reported the economy had gone down 2.4%.”

Hogwash, according to Schwarzman. But what about the comment that Bill Gross of Janus Capital recently made suggesting we are on the edge of a 30-year bear market? “We don’t look at it from a market perspective because we never have to be fully invested like the way Bill Gross does, or the way long-only managers do. We tend to only buy things when we like them…a lot,” he says, adding that he thinks the chances of a repeat of the 2008 meltdown are “very, very, very low.”

Schwarzman is instead looking for a slow steady economy, hazarding that the current growth rate of the U.S. economy is right around 2.5%. “It’s not real exciting. It’s not dreadful. And I anticipate this will continue for some time,” he says.

Schwarzman, 68, has a unique, panoramic view of the economy as head of Blackstone, which is one of the largest so-called alternative asset managers, along with KKR & Co. (KKR) and the Carlyle Group (CG). Blackstone owns a massive $310 billion of assets across all manner of markets and businesses, including investments in food company Pinnacle Foods (PF), Michaels Stores (MIK), energy company Cheniere (LNG), and even SeaWorld (SEAS) (the latter a story unto itself). Blackstone is one of the biggest real estate investors on the planet owning thousands of homes, retail and commercial buildings, and hotels, including major stakes in Hilton, La Quinta, and Extended Stay America. Blackstone recently stepped up to the plate to buy some $14 billion of holdings from GE (GE), which is looking to offload its real estate portfolio.

No question life is good for Schwarzman right now. Schwarzman has been devoting a significant amount of his time (and money) to the Schwarzman Scholar program. He hopes the program, which provides a one-year master’s degree through Tsinghua University in Beijing and is designed "to prepare the next generation of leaders" and facilitate greater understanding betweeen China and the rest of the world, will eventually be on par with the Rhodes and Fulbright scholarships.

He’s still on a crazy schedule, but it seems maybe, just a tad more, dare I say, relaxed? (How long will he stay in the job and what about Jon Gray as an heir? "We always have a succession plan, something could always happen to me, I sort of hope not but eventually that will happen and, you know, Jon is part of our succession plan.") He’s also avoided gaffes lately, like his over-the-top 60th birthday party in 2007, or in 2010 when he compared the tussle with the Obama administration over raising taxes on private-equity firms as war and “like when Hitler invaded Poland.”

Riding a wave

Instead, all Schwarzman and Blackstone have been doing is hitting the cover off the ball. Schwarzman personally reaped $690 million from Blackstone last year, a sliver of which was salary, some carried interest and mostly dividends he’s quick to point out — “I would make the same thing just about if I were retired,” he says — with no doubt even more to come this year. His 20% stake in Blackstone, plus accumulated wealth, make him worth some $13 billion, according to Forbes. As I point out in the video above, this is partly because Blackstone’s stock — now trading at around $42 — is up tenfold since the dark days of 2009 when it bottomed out at $4. “A little over $3,” Schwarzman corrects me with his trademark grin.

So yes, Schwarzman and his company have been riding a wave, but won’t he just crash again come the next downturn? Yes and no, Schwarzman seems to say, acknowledging that there will be volatility but pointing out that Blackstone’s returns over time have outpaced the market, he says, because the company invests in businesses and real estate and “improves them and adds value.”

“We live in the real world,” he says. “Securities go up and down, for sure. You go slightly over trend when things are growing because…of leverage, and we go under when things get weaker. But on the whole it’s a steady trend upwards. All you have to do is hold on during the downs and you get overly rewarded a bit on the way up.”

I ask Schwarzman, a prominent Republican supporter, if President Obama deserves any credit for the recovery. “A lot of people deserve credit, I think it’s fundamentally the Federal Reserve.” And then, “and the administration deserves some credit too. They did some good things.”

An understandable analysis. After all, what’s been good for the economy and the markets has been very good for Steve Schwarzman and Blackstone.