At a time when President Donald Trump fires off tweets against Amazon for the harm he says it is doing to both retailers and the economy, billionaire mall owner Rick Caruso has come to the defense of the online giant.

In fact, Caruso told CNBC's Swawk Box that Amazon has actually been "great for retail" because of a thing called "the Amazon effect."

Amazon has shown other retail owners "a path to success," Caruso said. He said that retailers cannot compete on price, but rather on knowing one's customer and on being convenient. As Amazon does.

Brick-and-mortar can do well through social interaction, experiences and a "sense of discovery," Caruso said. That is what Amazon itself plans to offer at its new physical stores.

Retailers following Amazon's lead in innovations and customer service are thriving, Caruso said. Stores that have stopped innovating are those that will fail, or have already, such as Toys R Us.

"I don't think any of us would wake up in the morning and be excited to go to Toys R Us," he told CNBC, adding that retailers suffer when consumers simply do not want to go to the environment they have created.

Among other properties, Caruso owns SoCal malls The Grove, The Americana at Brand and the Commons at Calabasas. His net worth is estimated to be $3.9B.