WEBVTT - Tesla Shareholder Gerber Pursues Board Seat 0:00:01.320 --> 0:00:05.680 This is Bloomberg business Week Inside from the reporters and 0:00:05.840 --> 0:00:09.400 editors who bring you America's most trusted business magazine, plus 0:00:09.480 --> 0:00:13.640 global business, finance and tech news. The Bloomberg Business Week 0:00:13.680 --> 0:00:18.600 Podcast with Carol Masser and Tim Stinebec from Bloomberg Radio. 0:00:19.360 --> 0:00:22.279 Well you like Paul. Last week, Ross Gerber, a vocal 0:00:22.520 --> 0:00:26.360 Tesla shareholder, Tesla car owner, frequent guests on our air, 0:00:26.400 --> 0:00:28.480 saying he will pursue a board seat on the electric 0:00:28.560 --> 0:00:31.360 vehicle maker's board well at the time, also saying that 0:00:31.400 --> 0:00:34.280 it's time for Tesla to grow up. Gerber's firm holding 0:00:34.320 --> 0:00:37.200 about four forty shares as of the end of last 0:00:37.240 --> 0:00:40.400 year of Tesla. That's according to our data. Ross's co 0:00:40.479 --> 0:00:43.839 founder president CEO Gerber Kawasaki Wealth and Investment Management. He 0:00:43.960 --> 0:00:48.560 joins us lucky for us via zoom from Santa Monica, California. Hey, Ross, 0:00:48.560 --> 0:00:50.440 good to have you here. Your fund. By the way, 0:00:50.479 --> 0:00:52.560 your e t F is that more than fourteen percent 0:00:52.640 --> 0:00:55.040 year to date, Tesla's your biggest shareholder, at least according 0:00:55.040 --> 0:00:59.680 to our data. UM talk to us about pursuing a 0:00:59.760 --> 0:01:02.279 board seat on Tesla. Why do you want to do 0:01:02.320 --> 0:01:05.720 it and what progress have you made? Towards that end. Well, 0:01:05.760 --> 0:01:08.600 I think mostly it's because I feel like it's time 0:01:08.680 --> 0:01:12.240 for Tesla's board to sort of take a more active 0:01:12.360 --> 0:01:16.560 role in some of the main issues that involve Tesla, 0:01:16.640 --> 0:01:19.680 which seemed to be i don't know, sort of ignored. 0:01:19.720 --> 0:01:23.360 And a lot of founder led companies, you know, grow 0:01:23.520 --> 0:01:26.600 to be very, very successful, um, and then they reach 0:01:26.640 --> 0:01:29.760 a point like where Tesla has, where certain things just 0:01:29.800 --> 0:01:31.960 need to change. And and I don't think these are 0:01:32.240 --> 0:01:34.920 you know, bad things. I think it's a good thing, 0:01:35.480 --> 0:01:38.320 um for Tesla to focus on, you know, really three 0:01:38.360 --> 0:01:41.039 main things that you know, I'm most concerned about, which is, 0:01:41.240 --> 0:01:44.800 you know, public relations, marketing, and lobbying so that things 0:01:44.840 --> 0:01:48.640 like full self driving you know, are you know appropriately 0:01:48.720 --> 0:01:53.400 understood by the public UM and the risks and rewards UM. Secondly, 0:01:53.440 --> 0:01:56.680 I'd love to see Tesla focus on the customer. The 0:01:57.320 --> 0:02:01.120 consumer is constantly having bad experience is with Tesla service 0:02:01.160 --> 0:02:03.840 and and and I just think somebody needs to really 0:02:03.840 --> 0:02:07.160 be focused on the customer over at Tesla. And then thirdly, 0:02:07.200 --> 0:02:11.239 a secession plan. Um. Ellen is clearly running Twitter here 0:02:11.280 --> 0:02:14.040 and that's his priority, which is fine, But if something 0:02:14.360 --> 0:02:16.840 ever happened in Eilani I mean, he is working, you know, 0:02:16.880 --> 0:02:19.800 like twenty hours a day, you know, you know, what's 0:02:19.880 --> 0:02:23.000 what's the plan for Tesla. So these things don't seem 0:02:23.000 --> 0:02:26.160 to be answered from Tesla. And and so now I'm 0:02:26.200 --> 0:02:28.960 pushing for board seat because I think it's time for 0:02:29.040 --> 0:02:31.519 there to be some accountability to these issues. So, Ross, 0:02:31.600 --> 0:02:35.200 you mentioned the PR situation when it comes to Tesla. 0:02:35.280 --> 0:02:39.400 To what extent are you concerned about Elon's impact on 0:02:39.600 --> 0:02:42.960 the company's PR. Well, I think that you know, for 0:02:43.000 --> 0:02:45.280 a long time, we got a lot of free advertising 0:02:45.280 --> 0:02:47.520 out of Ellen, and there was a perception of Ellen 0:02:47.960 --> 0:02:51.560 that was much more positive today now that Ellen runs 0:02:51.560 --> 0:02:54.880 Twitter and has taken many political positions, and I think 0:02:55.240 --> 0:02:58.640 it's his right to do that. But it's certainly unfortunate 0:02:58.760 --> 0:03:02.840 how many customers and shareholders here at least that I know, 0:03:03.040 --> 0:03:07.120 and which are a lot that really have now taken 0:03:07.120 --> 0:03:09.760 a negative you towards Ellen. And it's really kind of 0:03:09.800 --> 0:03:12.680 sad to me. And the bottom line is it's time 0:03:12.680 --> 0:03:15.680 for Tesla to build its brand around Tesla and about 0:03:15.880 --> 0:03:18.800 you know, the values that Tesla really stands for and 0:03:18.960 --> 0:03:21.799 versus what Elon's values are. And and so I don't 0:03:21.840 --> 0:03:24.960 really have any issue with his per se values. But 0:03:25.360 --> 0:03:28.160 we're in the selling car business, and you know, I 0:03:28.200 --> 0:03:30.280 don't know if that's what he's thinking every day when 0:03:30.280 --> 0:03:32.280 he gets up and tweets. So I think Tesla can 0:03:32.320 --> 0:03:36.360 take an active role in shaping the public perception of 0:03:36.480 --> 0:03:39.640 its wonderful products and services. Hey listen, are reporting via 0:03:39.800 --> 0:03:43.080 Ed Ludlow and Caroline Hyde. Um noted how you have 0:03:43.120 --> 0:03:46.119 a good relationship with UM. Some of the biggest shareholders 0:03:46.120 --> 0:03:48.360 in Tesla, someone who I've talked to a lot, Kathy 0:03:48.480 --> 0:03:52.080 would have our investment, and also Baily Gifford. Have you 0:03:52.200 --> 0:03:54.000 have they said that they would support you in your 0:03:54.000 --> 0:03:56.680 pursuit of a seat. Well, I haven't talked to any 0:03:56.720 --> 0:03:59.560 of the institutions yet because I haven't you know, I'm 0:03:59.600 --> 0:04:03.160 still officially got to send out my letter and get 0:04:03.160 --> 0:04:06.080 this going, which you will do that right now. Yeah, 0:04:06.080 --> 0:04:09.040 I will definitely be doing that, and and we're certainly 0:04:09.160 --> 0:04:11.000 and that's one of the reasons I'm running is just 0:04:11.240 --> 0:04:14.040 so that there is an option for people. I'm not 0:04:14.120 --> 0:04:16.960 like doing this for any like personal gain. Let me 0:04:17.000 --> 0:04:19.960 tell you, it's a very time absuming process and and 0:04:20.040 --> 0:04:22.960 most of my clients and and friends you know, are 0:04:22.960 --> 0:04:24.599 sort of like, we want you focusing on our money, 0:04:24.720 --> 0:04:28.200 not running Tesla or dealing with Tesla. And that said, 0:04:28.600 --> 0:04:31.599 you know, I just feel compelled that there needs to 0:04:31.640 --> 0:04:35.440 be a choice for investors, individual investors, so that they 0:04:35.480 --> 0:04:37.200 actually even know somebody on the board. You know, a 0:04:37.240 --> 0:04:39.560 lot of people are like, oh, we support Tesla's board currently. 0:04:39.680 --> 0:04:41.240 I'm like, do you even know who's on the board? 0:04:41.240 --> 0:04:43.719 And they're like no, And would you like, would you 0:04:43.760 --> 0:04:46.520 like to see there's another person. Ellen's obviously on the board, 0:04:46.560 --> 0:04:48.719 but Kimball Lusk is also on the board. Would you 0:04:48.760 --> 0:04:50.719 like to do Do you think it is just a 0:04:50.760 --> 0:04:55.920 board of people who really like Elon? And there do I? 0:04:55.920 --> 0:04:58.839 I do? And granted I really like Elon too, so 0:04:59.040 --> 0:05:01.680 it's you know, I'm not uh, I'm not a negative 0:05:01.720 --> 0:05:04.679 person here, and this is a friendly activist. I'm trying 0:05:04.680 --> 0:05:08.080 to help Tesla in a way that they're not good at. Okay, 0:05:08.160 --> 0:05:11.640 So there, you know. I'm a marketing pr kind of guru. 0:05:11.720 --> 0:05:13.560 That's kind of my thing, and and I think I 0:05:13.560 --> 0:05:16.000 could help the company dramatically, and I've been doing it 0:05:16.040 --> 0:05:17.520 for a long time behind the scenes, and a lot 0:05:17.560 --> 0:05:20.040 of people don't realize that that behind the scenes I've 0:05:20.040 --> 0:05:22.400 been you know, advising them for years and years and 0:05:22.480 --> 0:05:25.520 years about the way they handle many different elements of 0:05:25.560 --> 0:05:28.480 their marketing and PR. And that said, they've implemented a 0:05:28.520 --> 0:05:30.080 lot of these things over the years and it's been 0:05:30.160 --> 0:05:32.919 very successful. But I think at this point, you know, 0:05:33.080 --> 0:05:36.719 Tesla is now a six billion dollar company and and 0:05:36.839 --> 0:05:39.800 things like. You know, there was an anti Tesla ad 0:05:40.000 --> 0:05:41.839 that was run during the Super Bowl and how this 0:05:41.960 --> 0:05:44.600 even happened is mind blowing to me. And then there 0:05:44.680 --> 0:05:47.240 was no counter to that, and if you look at 0:05:47.240 --> 0:05:49.560 the headlines, they're just very misleading and it and it 0:05:49.640 --> 0:05:52.360 becomes very tiring. Well, Ross, I know you mentioned that 0:05:52.400 --> 0:05:54.720 you are a fan of Tesla, of course, but you 0:05:54.720 --> 0:05:57.440 would be referred to as a dissident shareholder if this 0:05:57.520 --> 0:05:59.760 went through and management did not support your efforts, which 0:05:59.800 --> 0:06:02.560 is interesting here. Um, I wonder have you spoken to 0:06:02.640 --> 0:06:06.440 Ellen No. Last time he spoke was on a Twitter 0:06:06.480 --> 0:06:10.320 spaces in December where I addressed many of the issues 0:06:10.360 --> 0:06:12.479 that I had and he addressed them back in a 0:06:12.520 --> 0:06:15.520 way that I was pretty happy with. But you know, 0:06:15.600 --> 0:06:17.800 we still don't have a CEO of Twitter, and that 0:06:17.880 --> 0:06:20.160 was one of the things, you know, I was hoping 0:06:20.200 --> 0:06:23.440 for you know that he would, you know, refocus on 0:06:23.440 --> 0:06:26.240 Tesla and find a CEO of Twitter and and and 0:06:26.279 --> 0:06:29.560 maybe even work a little bit less on creating you know, 0:06:29.600 --> 0:06:33.520 political comments that creates so much dissonance among so many 0:06:33.680 --> 0:06:36.920 Tesla owners. Um. But you know, I don't expect him 0:06:36.960 --> 0:06:39.280 to change his opinion or what he wants to say 0:06:39.320 --> 0:06:41.960 on Twitter. But I do think his focus. I mean, 0:06:41.960 --> 0:06:44.760 he's working three jobs. He's admitted to himself, he's exhausted, 0:06:44.760 --> 0:06:47.719 he's working seven. But in that Twitter space that you mentioned, 0:06:47.800 --> 0:06:50.200 Ross Musk did tell you that Twitter is about ten 0:06:50.279 --> 0:06:52.960 percent of the complexity of Tesla. Did you believe him 0:06:52.960 --> 0:06:55.919 when he told you that. I I think that I 0:06:55.960 --> 0:06:58.640 think he meant that after he's done dealing with what 0:06:58.680 --> 0:07:01.279 he's dealing with. But I don't think he's right. I 0:07:01.320 --> 0:07:04.840 think Twitter is a beast. It's super difficult to manage, 0:07:04.839 --> 0:07:08.159 and we're coming into an election cycle very soon, and 0:07:08.160 --> 0:07:11.160 and boy, it's a hard thing to be Twitter during 0:07:11.160 --> 0:07:14.680 an election, clearly, And so I just think this is 0:07:14.720 --> 0:07:17.800 a very big task that he's taken on. And and 0:07:17.960 --> 0:07:20.040 you know, once again, I I hope he said he 0:07:20.040 --> 0:07:23.240 would get a CEO for Twitter, and and I think 0:07:23.480 --> 0:07:25.160 that's one of the things I'm pushing for. The sooner 0:07:25.200 --> 0:07:28.080 the better he can have more help and leadership at Twitter, 0:07:28.160 --> 0:07:29.960 the more he can refocus on what's important to me, 0:07:30.000 --> 0:07:33.280 which is getting the cybertruck out and scaling production. And 0:07:33.760 --> 0:07:37.680 we've got battery production scaling so in Mega pac So 0:07:37.720 --> 0:07:40.560 it's a very important time for Tesla, and and and 0:07:40.600 --> 0:07:42.520 I just think he's a human being. And at some 0:07:42.600 --> 0:07:44.800 point you can't work seven days a week, twenty hours 0:07:44.800 --> 0:07:47.040 a day. UM. A couple of quick questions, because we've 0:07:47.080 --> 0:07:49.480 only got a couple of minutes left. Um. Tesla shares 0:07:49.480 --> 0:07:51.720 are up about sixty year to date, they're still down 0:07:51.760 --> 0:07:56.120 more than from that high back in early November. Ross. 0:07:56.160 --> 0:07:58.280 First of all, have you been buying at all this 0:07:58.360 --> 0:08:02.120 year and adding to your position? Yeah? Within my fund, 0:08:02.200 --> 0:08:04.560 we've added to our position, so we were able to 0:08:04.600 --> 0:08:08.480 buy Tesla shares cheaper to add to our position. Um 0:08:08.520 --> 0:08:11.960 when it went down. UM. So you know last year, 0:08:12.120 --> 0:08:15.000 this year, last year, this year, and and at the 0:08:15.080 --> 0:08:18.119 end of last year and early this year. UM. So 0:08:18.280 --> 0:08:20.600 you know, I can only really comment about my public 0:08:20.600 --> 0:08:23.240 fund because what happens in my firm, you know, varies 0:08:23.280 --> 0:08:26.559 by client and risk and all these other factors um 0:08:26.600 --> 0:08:29.160 but within my fund we've added to Tesla, it is 0:08:29.200 --> 0:08:31.640 a ten percent waiting currently, a littless than ten percent 0:08:31.680 --> 0:08:34.760 waiting currently, which is the highest waiting that we have 0:08:35.280 --> 0:08:38.560 for a position. So Tesla's are number one stock. I 0:08:38.600 --> 0:08:40.480 love the company. I think it has a wonderful future, 0:08:40.800 --> 0:08:43.360 but I would like to see some changes in the 0:08:43.400 --> 0:08:47.360 way that they're running the business. Final quick question for you. 0:08:47.640 --> 0:08:49.439 A lot of retail investors, as you know, have a 0:08:49.840 --> 0:08:51.880 p of their funds in Tesla. Where do you see 0:08:51.880 --> 0:08:55.240 the biggest upside for them? Well, right now, I think 0:08:55.360 --> 0:08:59.400 the biggest upside for Tesla is number one, successfully scaling 0:08:59.440 --> 0:09:02.240 their product in Berlin and Austin of the model why, 0:09:02.679 --> 0:09:06.240 number two getting the cybertruck out this year at some point. 0:09:06.480 --> 0:09:09.720 And number three it's clearly you know, mega pac production. 0:09:09.800 --> 0:09:12.359 You know, energy storage is going to be a phenomenal 0:09:12.400 --> 0:09:15.280 business for Tesla over time, and and now they're ramping 0:09:15.320 --> 0:09:18.199 this business, so trucks and mega packs. It was really 0:09:18.600 --> 0:09:22.080 the next level for Tesla, and and so you know, 0:09:22.160 --> 0:09:24.800 we're on the verge of a very good growth stage 0:09:24.840 --> 0:09:26.880 for Tesla over the next several years. But I'd love 0:09:26.920 --> 0:09:29.880 to see them really focused on their image in the public. 0:09:30.000 --> 0:09:33.000 Ross too quick questions Twitter. If he wasn't pursuing Twitter, 0:09:33.000 --> 0:09:34.160 do you think you and I would be having this 0:09:34.240 --> 0:09:37.400 question very quickly? No, if he wasn't involved with Twitter, 0:09:37.600 --> 0:09:39.959 I don't think we'll be having this conversation at all. 0:09:40.040 --> 0:09:44.360 And you still want Ellen running this company? Yeah? Absolutely, pcent. 0:09:44.400 --> 0:09:47.640 I mean what I really wanted him refocus back on Tesla. Listen, 0:09:47.920 --> 0:09:51.600 so appreciate your time, great conversation, Ross, and looking forward 0:09:51.640 --> 0:09:54.560 to seeing what comes next. Um Ross Gerber, President, chief 0:09:54.600 --> 0:09:58.640 executive officer at Gerber Kawasaki Wealth and Investment Management, investor 0:09:58.720 --> 0:10:00.719 in Tesla. It is his top hole. We heard him say, 0:10:00.760 --> 0:10:03.960 tempercent waiting in that fund of his and also an 0:10:04.000 --> 0:10:07.239 owner of the cars. Joining us via zoom from Santa Monica, California, 0:10:07.840 --> 0:10:11.360 you're listening to the Bloomberg Business Week podcast. Catch us 0:10:11.440 --> 0:10:14.080 live week days from two to five pm Easter on 0:10:14.160 --> 0:10:17.920 Bloomberg Radio, the Bloomberg Business Band. You too. You can 0:10:17.960 --> 0:10:21.240 also listen live to our flagship New York station, Just 0:10:21.360 --> 0:10:27.240 Say Alexa Play Bloomberg e Love and Didi Promising and 0:10:27.320 --> 0:10:30.280 watching Blomberg Business Week. On this Tuesday, Carol Master along 0:10:30.280 --> 0:10:33.360 with Madison Mills. So as technology seeks into every walk 0:10:33.400 --> 0:10:36.560 of life, an increasing proportion of Supreme Court decisions require 0:10:36.559 --> 0:10:39.400 at least a basic literacy and subjects that may not 0:10:39.520 --> 0:10:42.640 come naturally to the aging members. Not my words, they 0:10:42.679 --> 0:10:45.040 are the words of Bloomberg's Gregg Store, who writes about it. 0:10:45.320 --> 0:10:47.599 The upcoming new issue of Bloomberg Business Week out on 0:10:47.640 --> 0:10:50.360 newstands later this week, already on the Bloomberg and at 0:10:50.360 --> 0:10:52.560 Bloomberg dot com slash business Week. Greg as you know, 0:10:52.640 --> 0:10:55.320 Supreme Court reporter here at Bloomberg. He joins us from 0:10:55.360 --> 0:10:57.520 our nine and nine one studio in Washington, d C. 0:10:58.040 --> 0:11:00.360 Also with us, the editor of Bloomberg Business Week to Webber, 0:11:00.440 --> 0:11:03.400 he's in our Bloomberg Interactive Brokers studio. I've often thought 0:11:03.440 --> 0:11:05.440 about this, and we talked about this with lawmakers, like 0:11:05.480 --> 0:11:07.800 do they understand kind of all the high tech stuff 0:11:07.800 --> 0:11:11.760 that they're legislating. Well, that's what Greg came to us 0:11:11.800 --> 0:11:13.920 with UM, and this is just one of those ones 0:11:13.960 --> 0:11:16.960 where he really picked up the phone. He was very excited. 0:11:17.000 --> 0:11:18.360 He was like, Joel Children, I got to talk to 0:11:18.400 --> 0:11:22.679 you about this idea and and it turns out that, um, 0:11:22.720 --> 0:11:25.640 this is not a totally new idea, But it's really 0:11:25.679 --> 0:11:28.040 relevant right now because of the case they're gonna here 0:11:28.120 --> 0:11:32.319 next year, which we will basically focus on section to 0:11:32.559 --> 0:11:36.319 thirty and what that means for the future of the Internet. Um, 0:11:36.360 --> 0:11:38.800 so rewind the clock a little bit for us, Greg 0:11:38.920 --> 0:11:42.640 What what happens when Elena Kagan and Stephen Bryer sit 0:11:42.679 --> 0:11:45.760 down and play Grand Theft Auto like they did about 0:11:45.760 --> 0:11:50.280 a decade ago. We just soak in that moment for her. Yeah, 0:11:50.320 --> 0:11:51.640 I wish I could have been a fly on the 0:11:51.640 --> 0:11:54.079 wall for that that one. Yeah, this is a case 0:11:54.120 --> 0:11:57.520 about a decade ago. It was a California law that 0:11:57.600 --> 0:12:00.280 banned the sale of violent video games to my ears, 0:12:00.679 --> 0:12:04.520 and so Justice brier who was then in his early seventies, 0:12:04.640 --> 0:12:07.080 and Justice Kagan decided, we don't know a whole lot 0:12:07.120 --> 0:12:09.360 about violent video games, so we're going to check them out. 0:12:09.440 --> 0:12:12.200 And so, uh, they had it set up in Justice 0:12:12.200 --> 0:12:16.559 Briar's chambers and went down there and played Grand Theft 0:12:16.600 --> 0:12:19.040 Auto to try to learn a little bit about it. 0:12:19.080 --> 0:12:21.960 And as it turns out, according to Justice Kagan, she 0:12:22.040 --> 0:12:23.960 was a lot more enthusiastic about it than he was. 0:12:24.000 --> 0:12:26.480 He thought it was really awful and disgusting and she 0:12:26.679 --> 0:12:30.960 was like, next round, next round. Uh, you know, we 0:12:31.000 --> 0:12:33.480 have more, we have more reporting to do on Kagan's 0:12:33.559 --> 0:12:36.080 video game obsession, if it, if it became that, you know, 0:12:36.120 --> 0:12:38.520 including maybe what console she's in do But to keep 0:12:38.520 --> 0:12:40.920 it back on the Supreme Court. Um, you know, we're 0:12:41.320 --> 0:12:44.880 obviously Briar's not going to be on the bench when 0:12:45.080 --> 0:12:47.760 they hear this case next week. But what what do 0:12:47.800 --> 0:12:50.040 they have to do in order to get ready for 0:12:50.200 --> 0:12:52.079 a big case like the one they're going to hear 0:12:52.120 --> 0:12:55.760 when maybe they don't have as much expertise as people 0:12:55.760 --> 0:12:59.120 in the industry might. Well, the short answer is they 0:12:59.200 --> 0:13:01.040 do a lot of res with a lot of help 0:13:01.080 --> 0:13:03.160 from people around the court. You know, all of them 0:13:03.280 --> 0:13:07.120 have four twenty something are generally twenty something law clerks 0:13:07.200 --> 0:13:09.040 who can help him out. They've also got a whole 0:13:09.160 --> 0:13:12.240 courthouse full of people. So there's a case back in 0:13:12.240 --> 0:13:16.560 the late nineteen nineties having to do with restrictions on 0:13:16.720 --> 0:13:19.360 posting adult oriented material in the way that children might 0:13:19.360 --> 0:13:22.880 see them. And so i was back before the court 0:13:22.960 --> 0:13:25.640 was really connected to the internet. And so they set 0:13:25.679 --> 0:13:27.640 up a computer in the library where justices and their 0:13:27.679 --> 0:13:30.680 clerks would go there and and uh, you know, put 0:13:30.679 --> 0:13:33.000 in searches to see if you know, pornography popped up 0:13:33.080 --> 0:13:36.280 or something like that. UH. In a more recent case, 0:13:36.320 --> 0:13:39.440 I actually talked to Justice Bryer interviewed him last week, 0:13:39.480 --> 0:13:42.960 and he said, this is a copyright case involving Google 0:13:43.000 --> 0:13:44.880 and Oracle, and he said he just spent a lot 0:13:44.920 --> 0:13:48.200 of time trying to understand the Java programming language and 0:13:48.240 --> 0:13:51.600 how it worked, because that was central to the case 0:13:51.600 --> 0:13:57.199 whether Google infringed Oracles copyright and UH spent a lot 0:13:57.200 --> 0:13:59.440 of time. He has a very lengthy explanation in his 0:13:59.480 --> 0:14:02.840 opinion siding with Google. UH that for the most part, 0:14:02.880 --> 0:14:05.559 was pretty well received in terms of understanding the technology 0:14:05.559 --> 0:14:07.440 at issue in the case. I would love to be 0:14:07.480 --> 0:14:09.080 on the fly, a fly on the wall when they 0:14:09.080 --> 0:14:11.800 try to teach lawmakers about TikTok and the importance of 0:14:11.840 --> 0:14:15.920 that moving forward. You got to open it and spent 0:14:16.000 --> 0:14:19.400 about five hours a day on it. But in all seriousness, Greg, 0:14:19.680 --> 0:14:21.560 you know, to be fair to scout this. This is 0:14:21.600 --> 0:14:24.520 an issue that plagues a lot of lawmakers. We always 0:14:24.520 --> 0:14:26.960 hear these funny sound bites from members of Congress too, 0:14:27.080 --> 0:14:29.160 when they're you know, in a social media hearing or 0:14:29.160 --> 0:14:32.640 crypto hearing for example, we remember dog Coin from the 0:14:32.720 --> 0:14:35.720 ft X hearing the Internet runs on tubes most yes, 0:14:35.800 --> 0:14:38.600 exactly exactly. So how how does Scout is compared to 0:14:38.640 --> 0:14:42.240 Congress when it comes to understanding the Internet. Yes, it's 0:14:42.240 --> 0:14:45.040 a good question, Madison. There there are certainly some examples 0:14:45.080 --> 0:14:48.000 of the Supreme Court saying similar type things. Maybe not 0:14:48.080 --> 0:14:49.920 quite as bad as you know, the Internet being a 0:14:50.520 --> 0:14:53.080 collection of tubes. But you know, over the years, the 0:14:53.120 --> 0:14:56.720 Supreme Court is asked some questions during arguments that suggests, yeah, 0:14:56.760 --> 0:15:00.240 they may not understand the technology. But I think there 0:15:00.240 --> 0:15:02.840 are a couple of important points. One, the Court has 0:15:02.840 --> 0:15:07.359 gotten younger, so you have more justices who are uh, 0:15:07.400 --> 0:15:09.480 you know, in their fifties rather than in their seventies 0:15:09.520 --> 0:15:12.160 and eighties, or maybe understand the technology a little better. 0:15:12.480 --> 0:15:16.120 Uh they have kids as well. And secondly, regardless of 0:15:16.120 --> 0:15:18.160 the age of the justices, for the most part, when 0:15:18.200 --> 0:15:20.880 I talk to people, actually almost entirely when I talk 0:15:20.920 --> 0:15:26.359 to people, they said, despite some occasionally uh confused sounding questions, 0:15:26.560 --> 0:15:28.680 the Court generally does a pretty good job by the 0:15:28.760 --> 0:15:30.160 end of the day when it puts out the really 0:15:30.160 --> 0:15:33.760 important thing, which are its opinions, And no doubt that 0:15:33.760 --> 0:15:35.560 does get some help from the law clerks who maybe 0:15:35.640 --> 0:15:39.520 understand the technology better. Uh. But but for the most part, 0:15:39.600 --> 0:15:41.520 the court based on the people I talked to them, 0:15:41.520 --> 0:15:44.440 My reporting gets better grades than than a lot of 0:15:44.480 --> 0:15:48.360 members of Congress do. Greg. So, what's at stake with 0:15:48.440 --> 0:15:50.920 the case that they're going to hear next week and 0:15:51.200 --> 0:15:53.840 what exactly is it? What are they gonna hear? Yeah, 0:15:54.040 --> 0:15:56.400 so this is as you said, this is an argument 0:15:56.440 --> 0:16:00.640 they're going to have on a Tuesday of next week Tuesday, 0:16:00.640 --> 0:16:04.520 and a somewhat less important case case on on Wednesday. 0:16:04.840 --> 0:16:07.200 The Tuesday case is all about the saying called Section 0:16:07.240 --> 0:16:10.960 to thirty, which has been around sin It basically shields 0:16:11.000 --> 0:16:15.760 social media companies other Internet companies from liability because of 0:16:15.840 --> 0:16:19.200 posts put up by their users by third parties. And 0:16:19.240 --> 0:16:21.760 that has basically served as a very broad shield for 0:16:21.880 --> 0:16:25.160 Internet companies. And this is the case involving a lawsuit 0:16:25.240 --> 0:16:31.720 by the victim, the family of a terrorism victim, saying Google, 0:16:31.840 --> 0:16:37.280 through its YouTube service, UH, basically recommended terrorists content, terrorists 0:16:37.360 --> 0:16:41.920 videos and provided support to ISIS. And the question is 0:16:41.960 --> 0:16:45.400 whether that lawsuit can can even get in the door. 0:16:45.480 --> 0:16:47.440 If the Supreme Court says yes, it can get in 0:16:47.440 --> 0:16:49.480 the door. We're carving out a bit of a bit 0:16:49.520 --> 0:16:53.520 of an exception to section to thirty. Computer companies social 0:16:53.520 --> 0:16:56.400 media companies say, we are really worried that there will 0:16:56.400 --> 0:16:58.880 be no stopping that and and that that will force 0:16:58.960 --> 0:17:02.080 us to be a lot more restrictive about the content 0:17:02.280 --> 0:17:04.879 that our members are users can put up on the 0:17:04.880 --> 0:17:07.879 Internet because we're worried about being sued over it. Okay, 0:17:07.920 --> 0:17:10.840 so what does industry have to say about this? And 0:17:10.960 --> 0:17:15.520 this won't be the only two thirty case that they hear, right, well, so, 0:17:15.520 --> 0:17:17.840 so they have a two thirty case on Tuesday, as 0:17:17.840 --> 0:17:20.520 they said, there's a second case on Wednesday involving Twitter, 0:17:20.560 --> 0:17:23.760 and it's actually kind of a related question about whether 0:17:25.000 --> 0:17:27.280 the family of a terrorist victim can sue under this 0:17:27.359 --> 0:17:30.919 law that's it's called the Anti Terrorism Act. Uh. You know, 0:17:31.000 --> 0:17:34.400 the industry is basically saying this case has the potential 0:17:34.560 --> 0:17:38.200 to really transform the Internet, and not in a good way. 0:17:38.359 --> 0:17:40.719 It will force us to be it could force us 0:17:40.720 --> 0:17:44.360 to be censors to a large degree, it could restrict 0:17:44.400 --> 0:17:48.200 speech on the Internet. And they are arguing that there's 0:17:48.200 --> 0:17:50.480 going to be a carve out in section to thirty. 0:17:50.560 --> 0:17:52.600 This is really something that Congress ought to be able 0:17:52.640 --> 0:17:55.080 to do, because it can be a lot more precise 0:17:55.560 --> 0:17:57.440 rather than the kind of the blunt instrument of a 0:17:57.480 --> 0:18:00.520 Supreme Court opinion. Let's just hope they haven't playing video 0:18:00.520 --> 0:18:05.080 games exactly. Oh my god, that image. Um Gregg Store, 0:18:05.119 --> 0:18:07.320 thank you so much. He is, of course, Supreme Court reporter. 0:18:07.359 --> 0:18:09.000 Here at Bloomberg News from our not and I One 0:18:09.040 --> 0:18:11.720 studio in Washington, DC, are thanks to Joel Weber, the 0:18:11.880 --> 0:18:14.040 editor of Bloomberg business Week. This story, as we mentioned 0:18:14.080 --> 0:18:16.240 in the upcoming new issue of Business Week, out on 0:18:16.320 --> 0:18:20.720 newsstands already on the Bloomberg and Bloomberg dot Com. You're 0:18:20.760 --> 0:18:24.359 listening to the Bloomberg Business Week Podcast. Catch us live 0:18:24.440 --> 0:18:27.800 week days from two to five pm Easter on Bloomberg Radio, 0:18:27.960 --> 0:18:30.880 the Bloomberg Business app band you too. You can also 0:18:30.960 --> 0:18:34.879 listen live to our flagship New York station, Just Say Alexa, 0:18:35.080 --> 0:18:40.320 Play Bloomberg, e Love and Verdi. We mentioned higher price 0:18:40.359 --> 0:18:43.240 as we mentioned inflation. So this is a perfect segue 0:18:43.400 --> 0:18:45.240 to our next story, which is a most read on 0:18:45.280 --> 0:18:47.800 the Bloomberg. It's the Bloomberg Big Take. It's about car 0:18:47.880 --> 0:18:50.520 prices in the US hitting a record. I want to 0:18:50.560 --> 0:18:52.800 get right to it because Bloomberg Detroit. Your chief David 0:18:52.840 --> 0:18:56.119 Welch joins us via zoom from Detroit. David, good to 0:18:56.119 --> 0:18:58.680 have you here with Maddie and myself. So tell me 0:18:58.960 --> 0:19:01.040 what's going on. Although it's not a surprise because my 0:19:01.119 --> 0:19:03.080 husband I were looking at car prices and we were like, 0:19:03.119 --> 0:19:08.560 oh god, oh my god, everything's expensive. Yeah. Look, it's 0:19:08.720 --> 0:19:13.040 it's started with the pandemic because you had production constrained. Obviously, 0:19:13.359 --> 0:19:16.560 factories shut down and got worse with the semiconductor shortage, 0:19:16.800 --> 0:19:19.200 and now you've got high interest rates. So car payments 0:19:19.200 --> 0:19:22.040 are at a record seven seventy a month for new 0:19:22.080 --> 0:19:26.159 cars and about five fifty for use cars, which is 0:19:26.240 --> 0:19:30.160 quite a lot um. So what has happened up there's 0:19:30.200 --> 0:19:34.000 because of the semi conductor shortage. Production was slashed at factories. 0:19:34.400 --> 0:19:37.280 Dealers had shortages. They're often selling vehicles right off the 0:19:37.280 --> 0:19:39.480 trucks as they came in, prepping them and handing them 0:19:39.480 --> 0:19:42.360 over the consumers who paid for them weeks before, and 0:19:42.400 --> 0:19:46.480 so dealers were charging above sticker. Automakers were getting maximum price. 0:19:46.520 --> 0:19:50.439 There was no rebating, no zero percent financing deals, and 0:19:50.480 --> 0:19:55.159 they were also raising prices over the base. You know, 0:19:55.200 --> 0:19:58.720 the M S R. P has gone up about over 0:19:59.119 --> 0:20:01.960 for a lot of vehicles over the past to three years. 0:20:02.000 --> 0:20:05.840 So it's all very expensive and it could come down 0:20:05.920 --> 0:20:10.040 and probably will soften up as uh sending conductor production 0:20:10.040 --> 0:20:12.560 gets back and it is coming back. But in order 0:20:12.600 --> 0:20:14.960 for vehicles to get as affordable as they were three 0:20:15.040 --> 0:20:20.080 years ago, vehicle prices will have to basically crater, and 0:20:20.240 --> 0:20:22.720 I just don't see that happening. I think they will 0:20:22.760 --> 0:20:24.360 come down a bit, but I think it's gonna be 0:20:24.480 --> 0:20:26.320 We're gonna be paying more for a while, and a 0:20:26.320 --> 0:20:30.520 lot of middle class people cannot sensibly afford these new cars. 0:20:30.680 --> 0:20:32.960