Speaker 1: From Marhard where Innovation, Money and power Collie in Silicon
Speaker 1: Vallet NBN.
Speaker 2: This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.
Speaker 3: I'm Caroline Heinder Blomberg's world headquarters in New York, and
Speaker 3: I met Lovelow in San Francisco.
Speaker 4: This is Bloomberg Technology.
Speaker 3: Coming up US inflation it tops forecast in a blow
Speaker 3: to rate cut hopes. We'll discuss the implication of high
Speaker 3: for longer rates on the tech sector.
Speaker 2: Plus we'll dive into the names reporting tonight after the
Speaker 2: bell and get a read on the health of the
Speaker 2: gig economy.
Speaker 5: And we'll get an outlook for crypto.
Speaker 3: That's as bitcoin drops, having hit fifty thousand dollars for
Speaker 3: the first time in two years. All that and so
Speaker 3: much more coming up. First we check on in the
Speaker 3: macro picture today is dictated by that hotter than anticipated
Speaker 3: CPI print, which which means well, the market now anticipates
Speaker 3: rate cuts not happening until at least July, you let
Speaker 3: alone March that we'd previously been anticipating. Look, it is
Speaker 3: not therefore to those rate cut views and the S
Speaker 3: and P five hundred falls off that all important five
Speaker 3: thousand level that we do only just hit on Friday,
Speaker 3: the NASDAC under pressure then as that one hundred in particular,
Speaker 3: one of the worst performing off by one.
Speaker 5: Point two percent. So big tech really being squeezed at the.
Speaker 3: Moment, and you see those boring costs absolutely leaping to
Speaker 3: the higher side, the two year yield eclipsing the high
Speaker 3: since we've seen back in December when the FED did
Speaker 3: pivot and really make the market think we were going
Speaker 3: to see some rate cuts coming in twenty twenty four,
Speaker 3: we're currently up by some thirteen basis points in ed.
Speaker 3: Before we get into the micro we want to go
Speaker 3: broader with clear Bridge Investment senior research analysts Hillary Frish,
Speaker 3: who can really give us a perspective of what's been
Speaker 3: happening on a resasset basis, and ultimately we are seeing
Speaker 3: Hillary a perspective that well, maybe rate cuts aren't happening
Speaker 3: and what that means in terms of all the bets
Speaker 3: and the valuations ultimately they've been seen in big tech names.
Speaker 3: Do you think it's the right time to be such.
Speaker 6: A good question, Caroline, Thank you, it's terrific being here.
Speaker 5: It's we've had.
Speaker 6: Such a great run in technology and a relative relatively
Speaker 6: short period of time, and going into today's print, I
Speaker 6: was thinking that we're already entering a seasonally weaker part
Speaker 6: of the year. Now the tenures CPI is looking hotter,
Speaker 6: and also the US dollars up, so we can and
Speaker 6: absolutely likely will have some sell off at some period
Speaker 6: of time. I think at a minimum, we should have
Speaker 6: some consolidation, some digestion. That said, I'm about as bullish
Speaker 6: as I can be on the intermediate to long term.
Speaker 6: I'm not sure who was expecting rate cuts to really
Speaker 6: take place in March at this point given the Fed speak,
Speaker 6: and then finally the pain trade has really felt up
Speaker 6: not down. Today could change that. I think if we
Speaker 6: get to a four and a half percent level on
Speaker 6: the tenure, that's an important point of demarcation psychologically and
Speaker 6: also for valuations.
Speaker 3: What was in thing is basically how all in investors
Speaker 3: seem to have been going in tech stocks, particularly at
Speaker 3: the end of last week. Bank of America, as they
Speaker 3: always do, really dictating the flows that they've been seeing,
Speaker 3: and the fact that basically everyone has gone along this
Speaker 3: particular sector.
Speaker 5: Are we just seeing too much of a crowded trade
Speaker 5: at the moment.
Speaker 6: We're seeing some crowding. We're seeing some signs of exuberance,
Speaker 6: but I think what we also saw was the fact
Speaker 6: that investors were really off sides for this move heading
Speaker 6: into it. There wasn't enough participation. We were seeing some chasing. Absolutely,
Speaker 6: I wouldn't call it abject crowding, but I would say
Speaker 6: that last year was a year of reset and also
Speaker 6: profitability improvements. We saw six hundred basis points of profitability
Speaker 6: improvement across software in particular, five hundred to six hundred.
Speaker 6: That was pretty impressive in a dicceleration year, and this
Speaker 6: year should actually be a year of revenue reacceleration, although
Speaker 6: SQL if the economy doesn't absolutely fall apart, which doesn't
Speaker 6: look like it. So I think investors are willing to
Speaker 6: anticipate some of that. We're seeing some signs they're willing
Speaker 6: to look out a little bit. We'll see how they
Speaker 6: feel in the spring.
Speaker 4: Hary.
Speaker 2: The root of that Boa survey that Caro is talking
Speaker 2: about is just optimism about global growth, right earnings in
Speaker 2: the context of a strong global economy. This is what
Speaker 2: Aaron Brown and PIMCO told the show earlier today.
Speaker 7: This is this you're still seeing this market where you
Speaker 7: have one sector like the tech sector, which is up
Speaker 7: forty percent, and you have another sector like healthcare, which
Speaker 7: delivered earnings down twenty percent. It's a huge bifurcation in
Speaker 7: the market right now, and I think that that really
Speaker 7: presents a lot of opportunity for equity investors.
Speaker 2: A huge bifurcation. Who even cares about inflation? Just go
Speaker 2: with the tech sector? Is that your attitude?
Speaker 6: Oh, I think you have to care about inflation to
Speaker 6: a degree. And again above four and a half percent,
Speaker 6: you start to see some incremental concern over technology.
Speaker 8: For sure.
Speaker 6: It's a terrific point by Aaron. I think if we
Speaker 6: see a real broadening out of the economy, and yes
Speaker 6: we've seen some sectors absolutely annihilated, those representrificpportunities. We think
Speaker 6: that as a firm at Clearbridge, I personally also tend
Speaker 6: to believe that as we move further through time toward
Speaker 6: the second half of this year, where I think we
Speaker 6: will see a point of inflection in technology, in part
Speaker 6: driven by AI, in part driven by initiatives around AI,
Speaker 6: you will also see tech do well ultimately, but tech
Speaker 6: will have to tread water for a period of time
Speaker 6: to the extent that either the tenure continues to rise,
Speaker 6: or the economy the market broadens out to other sectors.
Speaker 6: So I think we're I don't know that we have
Speaker 6: to ultimately have an either or, although we might have
Speaker 6: one on an interim basis.
Speaker 4: You go back to economics one oh one.
Speaker 2: The idea simply is that the FED uses rates and
Speaker 2: higher rates to dampen demand, right impact consumption. In a minute,
Speaker 2: Karen and I are going to go deep on some
Speaker 2: of the gig economy companies. If you look at Uber
Speaker 2: last week, there is no evidence that consumer demand really
Speaker 2: or corporate command is slowing down. So it puts into
Speaker 2: questionable what was the point of having higher rates? Right
Speaker 2: if that is the only mechanism available to them, What
Speaker 2: do you make of that thesis?
Speaker 6: Well, it's not the only mechanism available to them, and
Speaker 6: we're going to see liquidity coming out of the market
Speaker 6: over time. It could be a lag. It certainly was
Speaker 6: a hotter print. We're not at five percent. Five percent
Speaker 6: would be another story, but we'll see how things trend
Speaker 6: in the coming months.
Speaker 3: What I'm interested in is some of your individual companies
Speaker 3: that you call out, where you see the opportunities perhaps
Speaker 3: in this pullback to be putting more into like Microsoft,
Speaker 3: like Salesforce, Oracle. What is this a moment to think
Speaker 3: about corporate spending rather than perhaps consumer spending, which we
Speaker 3: are worried about, particularly if we start to see more job.
Speaker 5: Losses in the back of AI.
Speaker 6: Absolutely well, what I do like about technology in general
Speaker 6: is that I think we went through many recessions last year.
Speaker 6: Last year companies were concerned about recession. They were laying
Speaker 6: off people, they were optimizing costs, they went on a
Speaker 6: buyer's strike. This year, there's an imperative to spend. Even
Speaker 6: if you're not spending directly in AI, you need to
Speaker 6: lay the foundation to be able to leverage AI. So
Speaker 6: that's a lot of data related investments, harmonization, getting data
Speaker 6: in order, it's a lot of infrastructure investment. It's migration
Speaker 6: of the cloud. You're starting to see the signs of that. Interestingly,
Speaker 6: Data Dog a consumption name and consumption names tend to
Speaker 6: lead reported this morning they report in a much better number.
Speaker 6: They reported slight acceleration. They guide it extraordinarily conservatively in
Speaker 6: my view, and rightly so. But nonetheless, the stock is
Speaker 6: actually down less than the NASDAK I think less than
Speaker 6: the SMP and I think it's because investors can see
Speaker 6: the signs of this improvement, the signs of this need
Speaker 6: to spend. So if the economy again, if we see
Speaker 6: outsized layoffs, that will be more of an issue. So far,
Speaker 6: we're seeing the opposite.
Speaker 5: At dieta dog now down by one point two percent.
Speaker 3: It was off more than six percent at one point,
Speaker 3: but that needs at reaction, just pushing it back off
Speaker 3: to the and traded.
Speaker 4: Yeah.
Speaker 2: I think one final question I've got for Hillary is, Okay,
Speaker 2: we know the AI story, we know about inflation, and
Speaker 2: we know.
Speaker 4: About the FED.
Speaker 2: How much of a wild card is the election this
Speaker 2: year for the technology sector?
Speaker 5: Hm?
Speaker 6: Well, I have to imagine it's a bit of a
Speaker 6: wildcarde it was last time Trump was on the ballot,
Speaker 6: but it frankly will get closer. But it feels like
Speaker 6: an autrinity from now when I think about how these
Speaker 6: tech stocks moved here to day. So I'll look forward
Speaker 6: to coming on and discussing that with you.
Speaker 4: Vn Ed all right, we'll hit you up on that.
Speaker 2: Hillary Fish of Clearbridge Investments, great analysis of the macro picture.
Speaker 4: Thank you. Let's go from what is the macro to
Speaker 4: the micro?
Speaker 2: There's a lot of stories that are happening in the
Speaker 2: ernies context. One of the things I wrote about at
Speaker 2: the beginning of the week in the Tech Daily news
Speaker 2: letter was the gig economy.
Speaker 4: Uber had a blowout quarter.
Speaker 2: Now its competitors are up next, Lift down three percent
Speaker 2: earnings today after the bell Airbnb.
Speaker 4: As well later in the Weekdoor Dash. What do we
Speaker 4: actually know about the.
Speaker 2: Demand side for the gig economy but also the supply side.
Speaker 2: Let's go to Bloomberg's Natalie Lung who covers this feat
Speaker 2: for Bloomberg Technology. Uber really set the bar high, right
Speaker 2: because Lift lives in their shadows. So let's start there.
Speaker 2: What are you expecting this week from Lyft for Lift?
Speaker 9: Yes, as you mentioned, they're kind of in a tough
Speaker 9: spot in comparison to Uber, who has the scale of
Speaker 9: international markets and as well as scale in other verticals
Speaker 9: like delivery and advertising. So for Lift, their performance, based
Speaker 9: on analyst estimates pretty conservative. Some analysts say they could
Speaker 9: deliver a beat, But then the concern is also like
Speaker 9: how much can they balance in terms of offering incentives
Speaker 9: to get more drivers get more drivers over from Uber,
Speaker 9: and how much subsidies and that sense and so, and
Speaker 9: especially because they announced like a seventy percent pay guarantee
Speaker 9: last week to sort of more drivers onto the platform
Speaker 9: and other features like a better response on deactivation account deactivations,
Speaker 9: and so the conversation will be around how much can
Speaker 9: you do that and not like eat into the margins.
Speaker 3: Let's talk about margins when it comes to food delivery
Speaker 3: in Siicar, we're anticipating this is one of the most
Speaker 3: shortened stocks out there at the moment. I think forty
Speaker 3: percent of the free flowt is currently being better against
Speaker 3: one of the worries here.
Speaker 7: Right.
Speaker 9: It's definitely again around the competition. So Uber door Dash
Speaker 9: they have they have not only just grocer delivery, they
Speaker 9: also the majority of the business is restaurant meals takeout,
Speaker 9: and so they do have that scale there which Instacart
Speaker 9: may be more limited right now. And also international ubers
Speaker 9: in a lot of international markets. DoorDash is in some
Speaker 9: parts of Europe and instacart is mostly in the US Canada.
Speaker 9: So the growth rate there in terms of orders of
Speaker 9: grosse transaction value will be of interest. Whether that can
Speaker 9: reaccelerate will be definitely If Chris, it's.
Speaker 2: The economy week lift kicking ourself after the bell this afternoon, Bloombgs,
Speaker 2: Natalie Lung, thank you so much.
Speaker 5: Firefly.
Speaker 3: It's Adobe's new flagship AI product that has been seen
Speaker 3: as perhaps a bit of a late comer to the
Speaker 3: likes of Mid Journey in Dahli, but now the company
Speaker 3: is banking one aspect that as competitors lack a commercially
Speaker 3: safe data set which provides IP guards, including legal support
Speaker 3: if anyone tries to sue them.
Speaker 5: Let's bring in Bloombogs Brodie Ford for more on this.
Speaker 3: And look, it's not exactly a sexy growth story to
Speaker 3: a certain extent.
Speaker 5: It's more about, look, we've got you.
Speaker 3: If you're a big client and you want legal protection,
Speaker 3: you got it with us.
Speaker 10: Yeah, everyone knows the story of your big tech incumbent
Speaker 10: and then this cool startup comes and smokes you. Right,
Speaker 10: and everyone thought out what would happen with open Ai
Speaker 10: in mid Journey with the image creations. But Anooahi has
Speaker 10: been coming out saying you're going to get sued right
Speaker 10: unless you us use these other guys. What's going to
Speaker 10: happen is they sucked in images from across the Internet
Speaker 10: with no copyright. It's a legal hazard. That's the argument.
Speaker 10: They've made, and so they've trained their system on their
Speaker 10: own Adobe stock, meaning that they have their own rights
Speaker 10: to use it. Obviously, some of the creators might not
Speaker 10: love that. There's probably still some legal dispute, but so
Speaker 10: far this pitch appears to be working with many big corporations.
Speaker 2: You give the example in the BusinessWeek piece of them
Speaker 2: commissioning photographers like eighty Bucks to go out and photograph animals,
Speaker 2: and the animals specifically are not allowed to wear clothes,
Speaker 2: which is what fun is that. The thing that always
Speaker 2: surprises me about Adobe, right Brodie, is that it is
Speaker 2: in the top forty biggest publicly traded companies in the world.
Speaker 2: And what it has in common with Microsoft is it's
Speaker 2: got a very good track record of selling subscriptions on
Speaker 2: software where you can get a similar tool for free
Speaker 2: pretty much anywhere will still pay for it. So let's
Speaker 2: go back to the intro. We said they want to
Speaker 2: be profitable. How do they plan to make firefly profitable?
Speaker 10: As you said, Adobe's creative cloud is very profitable. I
Speaker 10: mean I've had people say to me it's one of
Speaker 10: the most profitable things ever, not even just software, just products.
Speaker 10: It is a complete cash cout and it is not
Speaker 10: because it's the easiest to use or the cheapest, but
Speaker 10: because it works well together. Right, if you have a
Speaker 10: creative agency of a marketing agency, they need photo, video, audio,
Speaker 10: it needs to work well together. And now they need AI.
Speaker 10: And so Adobe's bet is that when they put AI
Speaker 10: into each one of these products, into the content supply
Speaker 10: chain as they call it, it'll work well together and
Speaker 10: people will be willing to pay extra for it, and
Speaker 10: more importantly, that they won't go to open AI or
Speaker 10: mid journey and then cancel their Photoshop subscription. I mean
Speaker 10: right now they're barely even charging for this. It's more
Speaker 10: of a plan that stay the ecosystem.
Speaker 4: And within Adobe.
Speaker 2: Inside Adobe, though, there are employees and staff that are
Speaker 2: worried about that ecosystem and the creatives that'll operate within it.
Speaker 9: Well.
Speaker 10: Yeah, there's a funny story we hear. We have it
Speaker 10: in the story about you know, there's a presentation in
Speaker 10: twenty nineteen. Someone is saying, listen, you guys, you are
Speaker 10: going to get disrupted if you don't take this stuff seriously,
Speaker 10: and the executives in the room being like, we're good,
Speaker 10: They're not going to leave us, you can know. So yeah.
Speaker 10: I mean it's a classic story a big company doesn't
Speaker 10: invest enough in an emerging technology and gets disrupted. In
Speaker 10: one year ago, everyone expected this to be the case
Speaker 10: for Adobe. Today the picture is a little blurrier. I mean,
Speaker 10: their argument has been landing, and I talked to a
Speaker 10: lot of Wall Street types to say that the two
Speaker 10: companies who are going to see a material uplift this
Speaker 10: year from AI Microsoft first and then Adobe.
Speaker 3: You see that coming from our own boombug intelligence team
Speaker 3: members and thinking Anna Ragrana putting out a note this
Speaker 3: morning saying it over you can see a one billion
Speaker 3: dollar mid term generative AI lift at the moment in
Speaker 3: terms of creative cloud, is there still any ramifications from
Speaker 3: the big m and a deal that fell apart the Figma,
Speaker 3: the anticipation that they've been distracted by having to go
Speaker 3: through such legal wranglings rather than focusing in on what
Speaker 3: is for many, you know, the new electricity when it
Speaker 3: comes to data visa, the new way in which we're
Speaker 3: thinking about technology.
Speaker 10: The way most folks understand it is that Figma was
Speaker 10: supposed to transform Adobe, and then AI was supposed to
Speaker 10: transform Adobe. So the fact that Figma fell apart that
Speaker 10: means AI really has to work out. I mean a
Speaker 10: lot of their eggs are in this basket, and we
Speaker 10: haven't even touched on the idea that this technology might
Speaker 10: kind of disrupt their own user base, right, I mean,
Speaker 10: millions of people pay for these tools. Are they going
Speaker 10: to be out of work? Are they just going to
Speaker 10: want a general images and not need to pay Adobe?
Speaker 10: I mean, even those who are bullish on Adobe's AI
Speaker 10: efforts see that there is some potential for this to
Speaker 10: knock out a bit of their user base. So I mean, yeah,
Speaker 10: now that Figma's gone, this needs to work, and it
Speaker 10: appears to be at this moment, but there is uncertainty remaining.
Speaker 2: In Berg's Brady Ford with the Adobe AI deep dive.
Speaker 2: Thanks coming on the show Mate, Now coming up here
Speaker 2: on Bloomberg Technology. Elon Musk's X looks to compete with
Speaker 2: the likes of YouTube by adding new advertisers targeting features
Speaker 2: to the platform.
Speaker 4: Will bring you all those details.
Speaker 2: Next is the company also looking to glurin creators, Karl,
Speaker 2: what are you looking at?
Speaker 5: I love the story that we're watching.
Speaker 3: And this is a European company of course, ASML the
Speaker 3: most valuable.
Speaker 5: Tech stock in Europe. A little bit of pressure.
Speaker 3: Today at one point, some significant pressure, a so called
Speaker 3: fat finger. Basically an eriness trade, whether that's by a
Speaker 3: human or an algorithm, is what many are blaming for
Speaker 3: a seven percent plunge that we saw in the stock
Speaker 3: at the open. Now the URINEX the overall that it's
Speaker 3: on and said, look, that wasn't to blame.
Speaker 5: Had no alerts that were triggered.
Speaker 3: But now people are basically rather questioning the valuations that
Speaker 3: we've seen, the run up that you've seen on ASML
Speaker 3: and in SAP for example, or by two point eighther
Speaker 3: center for the last couple of trading days. There's a
Speaker 3: rumot technology time now for talking tech. First up Open
Speaker 3: AI CEO Sam Altman, but he said that the UAE
Speaker 3: could serve as the world's regulatory sandbox to test AI
Speaker 3: technologies and then lead to spearhead global rules limiting their use.
Speaker 5: The comments calm, of course, as Altman.
Speaker 3: Is calling investors in the Middle East for a Semiconductor
Speaker 3: initiative to advance AI. Meanwhile, X has won a dismissal
Speaker 3: of claims that it conspired to supply the Saudi government
Speaker 3: with confidential user information to identify a Sali man who
Speaker 3: was arrested, tortured and sentenced to twenty years in prison.
Speaker 3: That's for posting remarks critical of the government. Now, the
Speaker 3: person in question had alleged that the social media company
Speaker 3: conspired with the Kingdom of Saudi Arabia to violate the
Speaker 3: rack t Influenced and Corrupt Organizations Act and the Alien
Speaker 3: Taught Statute.
Speaker 5: Then, in a fura monex.
Speaker 3: Spaces, of course, Elon Musk told US Republican senators that
Speaker 3: there is no way in hell that Russian President Vladimir Putin.
Speaker 5: Could lose the war on Ukraine.
Speaker 3: It was also in that space's opponents of a Senate
Speaker 3: bill that will provide further assistance for Ukraine to continue
Speaker 3: battling the full scale Russian invasion, and of course began
Speaker 3: two years ago.
Speaker 4: Ed well, let's stick with X.
Speaker 2: Elon Musk's platform is adding you advertiser targeting features to
Speaker 2: better entice video creators and compete against YouTube, joining us
Speaker 2: with the details Bloomberg's Asia councin Asia. We reported this
Speaker 2: idea back in October. Right, so, Musk and Lindy Yakarino
Speaker 2: did their first ever join all hands in the company,
Speaker 2: and they said, our competitor in the future is going
Speaker 2: to be YouTube. And what's happened since October is all
Speaker 2: of these video focused developments, and that's what you've been
Speaker 2: writing about today exactly.
Speaker 11: Has been pushing into video hard, as you mentioned, must
Speaker 11: have been talking about this forever and now we're starting
Speaker 11: to see some realization of it. So, just in the
Speaker 11: past number of weeks, they've signed content partnerships with people
Speaker 11: like Don Lemon, former CNN anchor, and Tulsa Gabbert, who
Speaker 11: was the US representative and a presidential candidate. They signed
Speaker 11: content deals with them to produce shows and put them
Speaker 11: exclusively on X First. They did the same thing with
Speaker 11: the World Wrestling Entertainment so WWE, and they're continuing to
Speaker 11: push to go after creators. And now what we see
Speaker 11: is now they're giving advertisers more control to actually put
Speaker 11: their ads on the profile of a creator that they
Speaker 11: like in order to generate more revenue from them and
Speaker 11: just allow those advertisers to take advantage of the profile
Speaker 11: and the followers that these creators are going to bring
Speaker 11: to the platform.
Speaker 3: And also I expose to a certain extent, would it
Speaker 3: provide some certainty to an advertiser that I'm just putting
Speaker 3: my brand, my name, my message via one particular content
Speaker 3: creator rather than who knows where it ends up being.
Speaker 5: Next to it.
Speaker 11: Absolutely, I mean that's been a huge topic of conversation
Speaker 11: with Exit particular. As you both know, over the past
Speaker 11: year or so, they've dealt with a lot of content
Speaker 11: safety issues. So we saw a bunch of advertisers leave
Speaker 11: when they found out that their ad was next to
Speaker 11: antisemitic content, for example, not too long ago. And so
Speaker 11: absolutely this is another control to say, hey, I want
Speaker 11: my advertisement to only be on a video by mister Beast,
Speaker 11: for example, So you know you're reaching those followers. You
Speaker 11: know that your content is going to be right in
Speaker 11: front of their videos, so it lessens the chance that
Speaker 11: it's going to be next to some harmful content. So
Speaker 11: it is a little bit of an assurance for an advertiser,
Speaker 11: So you can imagine that might be something that's attractive
Speaker 11: to them.
Speaker 3: As she counts all over the developments, X, we thank
Speaker 3: you so much.
Speaker 2: I'm also taking a look at bitcoin, and I'm sorry
Speaker 2: to say that we've also changed direction on bitcoin. We're
Speaker 2: lover for the first time in around eight sessions. But
Speaker 2: over those eight sessions we posted a significant gain of
Speaker 2: fifteen percent. We're below fifty thousand US dollars per token
Speaker 2: as it stands, but when we did hit that milestone,
Speaker 2: I know that all of us were very excited because
Speaker 2: it's kind of psychological flat level of fifty thousand US
Speaker 2: dollars be tooken.
Speaker 5: It is a focus.
Speaker 3: The vying of the market capitalizations is one we focus on,
Speaker 3: and then we think about the vying when it comes
Speaker 3: to which crypto ecosystem is really on the win. Let's
Speaker 3: talk about all of this as to what's bringing us
Speaker 3: up to that fifty thousand dollars level and then dragging
Speaker 3: us back down. August co founder and Coca Aya Kontorovitch
Speaker 3: is joining us for more.
Speaker 5: And yes, perhaps.
Speaker 3: The CPI print takes the wind own of its sales
Speaker 3: a little bit like every risk I said on the day.
Speaker 3: But what has been blowing us higher when it comes
Speaker 3: to bitcoin? Is it ETF flows or is it something
Speaker 3: else more fundamental that's happening.
Speaker 12: Sure, you know, I'm sure that folks would like to
Speaker 12: say that a part of it has to do with
Speaker 12: Jack Dorsey wearing this SOCI shirt during the Super Bowl,
Speaker 12: But it really is, to your point, us inflow is
Speaker 12: coming in around the ETF We saw April and June
Speaker 12: BTC call buyers with strekes at around seventy K to
Speaker 12: seventy five K, which are all time high prices. We're
Speaker 12: also seeing a lot of that narrative around the April
Speaker 12: nineteenth coming up, and overall spot and option positions that
Speaker 12: are really gearing up for pricing to break all time highs.
Speaker 12: In Q two we saw BDC per futures open interest
Speaker 12: also cross eleven billion, which is the highest ever since
Speaker 12: December twenty twenty one. So a lot of US inflow
Speaker 12: momentum going on right now.
Speaker 3: I hate to always just talk about and focus obsessively
Speaker 3: about price, but ultimately the market being dictated that we're
Speaker 3: going to eclipse this fifty thousand is I think we're
Speaker 3: going to eclipse to sixty nine thousand that we've seen previously.
Speaker 12: Absolutely, it looks like, I mean again, from anywhere between
Speaker 12: seventy k to seventy five.
Speaker 5: K that is very, very bullish, and we really.
Speaker 12: Haven't seen those prices historically, So yes, it does look
Speaker 12: like we're going to eclipse those and it really does
Speaker 12: look like that's coming from the US side. You're seeing
Speaker 12: that reflected in coinbas BDC pricing, which was trading at
Speaker 12: a premium to finance BDC pricing, which again reflects the
Speaker 12: fact that you're seeing a lot of US inflow coming
Speaker 12: in that's pushing that price higher at a premium, and
Speaker 12: as well reflected by the ETF influence, which continues to
Speaker 12: make that narrative strong US specifically focused.
Speaker 9: Hi.
Speaker 2: We were reflecting on the show yesterday that if you
Speaker 2: think about it in really simple terms, from kind of
Speaker 2: end of twenty two to present day, there's this kind
Speaker 2: of minimal jump on bitcoin from forty four thousand to
Speaker 2: forty eight thousand dollars per token, and in between all
Speaker 2: kinds of chaos and volatility lows of fifteen thousand, five
Speaker 2: hundred a brief peak.
Speaker 4: But what also.
Speaker 2: Happened in that time is that thousands of old coins
Speaker 2: and other digital tokens just cease to exist, right they
Speaker 2: or they become a liquid How much of this story
Speaker 2: is about bitcoin kind of being the only stable option
Speaker 2: if you want some exposure to a cryptocurrency.
Speaker 12: I think it's pretty crazy that we're talking about bitcoin
Speaker 12: now as being the stable currency, but you're even seeing
Speaker 12: that reflected in some of the language that's is pushed out.
Speaker 12: I would say that's very much true. However, ethereum is
Speaker 12: still playing into that narrative. A lot of what's going
Speaker 12: on right now is with regards to the restaking narrative
Speaker 12: and Ethereum driven by an eigenlayer, and so you're seeing
Speaker 12: a lot of narratives around both.
Speaker 5: That and in Eth ETF.
Speaker 12: Yesterday you saw that Franklin Templeton also submitted an application
Speaker 12: for ETF, which caused a small bounce in the Eth price,
Speaker 12: and so we're likely going to see that happening with
Speaker 12: Eth as well. And you are seeing other applicants for
Speaker 12: an ETF, whether it's Solana or other all coins where
Speaker 12: that may also lead to some of that lower volatility
Speaker 12: around those tokens as well.
Speaker 3: You've been building for a long time, whether it's August,
Speaker 3: whether previously you're helping thing on the founding team of Falconnects,
Speaker 3: but also you're in the investing space and understanding what
Speaker 3: was going on in Pantera Capital. What is the building
Speaker 3: like right now when we think about sort of the
Speaker 3: oxygen being sucked out the rim by the OG's a
Speaker 3: bitcoin and eighth but still salon again and look in
Speaker 3: some of the olt coins, what's been built from an
Speaker 3: infrastructure layer, from adapt level, from an actual go out
Speaker 3: there and use this in some way, shape or form.
Speaker 12: It has never been a hotter time to build in
Speaker 12: this space than now. You are seeing folks doubling down,
Speaker 12: people who have been in the space for years, who
Speaker 12: have really clarified what are the to your point, the
Speaker 12: problems in on the infrastructure layer that need to be
Speaker 12: solved for people to actually be able to use.
Speaker 11: This at scale.
Speaker 12: And so the biggest thing right now is account abstraction
Speaker 12: being able for these applications to be used on a
Speaker 12: front end without having to deal with all of the
Speaker 12: interactions with the blockchain on the back end.
Speaker 5: You know, we've been talking about that.
Speaker 12: Narrative for years. How do you get to a point
Speaker 12: where you can just send a transaction using a front
Speaker 12: end UI And we are getting closer to that point. Again,
Speaker 12: this infrastructure takes time to build, and every single day
Speaker 12: we're getting closer to that. Like I said, it really
Speaker 12: just hasn't been a hotter time to be a builder
Speaker 12: in crypto than today.
Speaker 5: So it's very exciting.
Speaker 4: A real quick eye harving due in April. Do you care.
Speaker 5: Absolutely?
Speaker 12: I would say there's always a narrative around it, you know,
Speaker 12: it's whether it's going to be by the rum or
Speaker 12: sell the news. That's typically what we've seen to date.
Speaker 12: But again it does take a while for the flows
Speaker 12: to come into the ets, you know, especially on the
Speaker 12: RIA space. So it'll be interesting to see what happens
Speaker 12: on the retail side, what happens on the RIA side,
Speaker 12: and if that narrative is going to be reflected with
Speaker 12: users there. And of course Asia. We haven't seen as
Speaker 12: much Asia inflow with all of this being historically led
Speaker 12: right now with the US sides, so very very interesting.
Speaker 5: And then the eth BTC ratio.
Speaker 2: August co founder and co CEO Iakontarovitch Greats catch up
Speaker 2: here on the program. Now, Carrie, you went out the
Speaker 2: building in the snow this morning for a pretty important conversation.
Speaker 3: I thought the element said for a breakfast meeting, because
Speaker 3: I was lucky enough to be sitting down with the
Speaker 3: Sunivation Ventures chairman and the CEO, that's Kaifoon Lee. It
Speaker 3: was over at the Economic Club of New York and
Speaker 3: fifty four we were chatting about what else artificial intelligence.
Speaker 3: Of course, he's written many a book, forward thought on
Speaker 3: many an impact, And we start the conversation by asking
Speaker 3: if big tech companies, the ones that are still here,
Speaker 3: can actually truly pivot to be AI first.
Speaker 5: Take a listen.
Speaker 13: Theoretically, they're the best equipped to do AI first because
Speaker 13: they have the most AI experts in those two companies
Speaker 13: if you coun't open AI in Microsoft's camp. But what
Speaker 13: they face is a fundamental business issue of cannibalizing your
Speaker 13: own business.
Speaker 14: So for a.
Speaker 13: Large company, imagine if you will your Microsoft or Google,
Speaker 13: the first thing you're going to think to want to
Speaker 13: do once you invent this technology is how do you
Speaker 13: make money?
Speaker 14: And of course Google will make the most money from
Speaker 14: putting it in search.
Speaker 13: Microsoft will make the most money by putting it in office,
Speaker 13: so that will be.
Speaker 14: The low hanging fruit. But low Microsoft.
Speaker 13: Become a disruptor that says I'm going to build a
Speaker 13: new engine that's AI first, that causes more people to
Speaker 13: no longer need.
Speaker 14: Or want to use office or pay for it.
Speaker 13: Few companies, if any, has ever done that. Right, when
Speaker 13: Kodak invented the digital camera, they shelfed.
Speaker 14: It because as they think it would kill the film business.
Speaker 13: It did, but it wasn't because of them, but other companies, right,
Speaker 13: So the same thing happens with you, Intel not embracing mobile,
Speaker 13: Qualcom not embracing AI, and.
Speaker 14: The list goes on. So it's fundamentally really hard.
Speaker 13: For a large company not to take this technology and
Speaker 13: put it in the most best selling product to make
Speaker 13: that easy low hang through.
Speaker 14: And it's incredibly hard for them to build a disruptive
Speaker 14: product that.
Speaker 13: Will challenge, cannibalize, and potentially kill the revenue that is
Speaker 13: currently a cash car for them.
Speaker 9: Now.
Speaker 3: Of course, Kai fee Lee I worked for both Microsoft
Speaker 3: and for Google over there in China. He's been, of
Speaker 3: course an investor, he's an author.
Speaker 5: He's actually getting back into the.
Speaker 3: World of building businesses and he's got his own was
Speaker 3: one zero one dot Ai and this is all about
Speaker 3: sort of the Chinese models that he can build in
Speaker 3: focus is open source. And he actually said one of
Speaker 3: his great lines when we were sitting down was he
Speaker 3: thinks open AI should rebrand. We've heard that one before,
Speaker 3: but he thinks it's one of those closed shops there.
Speaker 4: Is closed AI.
Speaker 2: I mean, he's seen as a bridge right understanding what's
Speaker 2: happening in China's domestic efforts on AI. He knows what
Speaker 2: the Western World is doing. But as he said, he's
Speaker 2: going back to being a startup founder while being plugged
Speaker 2: into the megacaps that have basically competing business models, is
Speaker 2: what I heard. He's trying to outline here their AI
Speaker 2: work and then their call legacy business, and.
Speaker 3: He thinks they will be disrupted and eventually the winners
Speaker 3: will be AI first. I have to say, I haven't
Speaker 3: seen him quite as well worried in a long time.
Speaker 3: He's usually an optimist, but he is concerned about the scale,
Speaker 3: the pace at which we're innovating. But he did talk
Speaker 3: about China, and look he phil still thinks that China
Speaker 3: can get to an never beat us an innovation, certainly
Speaker 3: on implementation, he thinks it can get there.
Speaker 4: We're coming up here on the program.
Speaker 2: We will continue to talk about AI and opportunities in
Speaker 2: the investment space, innovation more broadly. That conversation with alic
Speaker 2: Ross board member Amplo, Okay, I.
Speaker 3: Just want to focus a little bit on what's happening
Speaker 3: with IBM today because New York parents amid this snow
Speaker 3: ed have had real tech issues basically getting their kids
Speaker 3: to do remote schooling, and there are statements coming from
Speaker 3: the New York City Department of Education on exiting.
Speaker 5: We're currently experiencing issues.
Speaker 3: With services that require IBM authentication login. We're actively working
Speaker 3: with the IBM to resolve it and we provide an update.
Speaker 5: And in fact they did.
Speaker 3: Roll out some added capacity and improvements to the system.
Speaker 3: But like every stock today, it's down by one point
Speaker 3: one percent. Sorry to all those parents out there. This
Speaker 3: is BLUEBG technology.
Speaker 4: Okay, time for the VC roundup.
Speaker 2: First up VC firm found previously called Wingman Ventures, is
Speaker 2: raising one hundred and twenty million dollars for a new
Speaker 2: fund to target Swiss AI and tech startups. The firm
Speaker 2: says it's already raised eighty five million and aims to
Speaker 2: make up the rest. By July, an AI startup Marco
Speaker 2: raised twelve point five million dollars in a Series A
Speaker 2: round led by Lightspeed Venture Partners, gaining funds to develop
Speaker 2: its technology that helps companies search the vast amounts of
Speaker 2: unstructured data in their systems. Blackbird Ventures and January Capital
Speaker 2: also took part in the round. Plus Bioage Labs, a
Speaker 2: clinical stage biotech company developing therapies for obesity and metabolic disease,
Speaker 2: raised one hundred and seventy million dollars in an oversubscribed
Speaker 2: series definancing round led by Sophenova Investments. We are going
Speaker 2: to have the CEO and co founder of Bioage with
Speaker 2: us later in the program, Cara.
Speaker 3: Well, first, let's go back to sort of what Bioage
Speaker 3: is using AI to spearhead moves forward in healthcare VC Spotlight.
Speaker 3: We want to talk about the broader opportunities but also
Speaker 3: the strains that AI presents the economy much much more
Speaker 3: with alic Rossi's tech policy analyst and board member for
Speaker 3: vcfern Amplos, also the author of the Raging twenty twenties, Companies, Countries,
Speaker 3: People and the Fight for Our Future, and of course
Speaker 3: he served as Senior Advisor for Innovation to the Secuary
Speaker 3: of State during the Obama administration and Alec, we sit
Speaker 3: here at a time of ultimate disruption. It feels like
Speaker 3: we're thinking of companies that are all in on operational
Speaker 3: efficiency in their earnings, but also letting go of people
Speaker 3: at a rapid rate. We're thinking of investment in technology,
Speaker 3: but job's ultimately going to be disrupted by this. Where
Speaker 3: do you sit in the optimist versus personimistic side of
Speaker 3: AI application?
Speaker 1: I'm net positive over the medium to long term. Over
Speaker 1: the short term, though, it's going to be a little
Speaker 1: bit tricky, because what we see is AI enabling automation
Speaker 1: of labor that isn't just manual and routine for cognitive.
Speaker 4: And non routine.
Speaker 1: Is it's wiping out a lot of jobs, the likes
Speaker 1: of which, like my father, who is a lawyer, the
Speaker 1: kind of work my father did as a lawyer ought
Speaker 1: to be ninety nine percent done by software at this point.
Speaker 1: And that's not necessarily a bad thing, but it is
Speaker 1: a bad thing for people later in their careers who
Speaker 1: aren't going to be able to pivot necessarily from.
Speaker 4: A statistical standpoint.
Speaker 1: From a statistical standpoint, it's not going to be as
Speaker 1: bad as one might imagine the impact of AI on labor,
Speaker 1: but over the short term we're going to see some
Speaker 1: automation of a lot of white collar jobs.
Speaker 2: The interesting dynamic right now, Alec, if you look at
Speaker 2: the entirety of the newsflow, is layoffs and cost cuts
Speaker 2: at bigger companies are in part being carried out to
Speaker 2: free up funds to invest in AI. Ironically, is the
Speaker 2: earliest stage ecosystem of all these startups that say we're
Speaker 2: using AI to automate or make more efficient specific function
Speaker 2: feel any of that, you know, the reallocation of capital
Speaker 2: from say headcount to a new AI.
Speaker 4: Tool, Well, yes to no.
Speaker 1: And first of all, let's be let's have some you know,
Speaker 1: intellectual honesty around a lot of the drama around layoffs.
Speaker 1: Unemployment is really really low in the United States right now.
Speaker 1: Some of the layoffs that are getting lots of attention
Speaker 1: are getting lots of attention because they are inside platform
Speaker 1: companies that have been hiring wildly for years. But if
Speaker 1: you take take a sort of cold blooded look at
Speaker 1: employment in the United States, unemployment is shockingly low. I
Speaker 1: live in Maryland, where the unemployment rate is like two
Speaker 1: point four percent.
Speaker 4: That's nothing.
Speaker 1: So I don't think we need to be sounding alarm
Speaker 1: bells yet about layoffs, in part because there's people being
Speaker 1: laid off inside these platform companies can go get work
Speaker 1: inside startups the likes of which I invest in. And
Speaker 1: what we're seeing inside these startups is they are using
Speaker 1: AI in a way that is enabling them to not
Speaker 1: have to build their headcount too fast. So this is
Speaker 1: enabling the growth of really lean startups. So I think
Speaker 1: it's actually helping the startup ecosystem a little bit more
Speaker 1: so than some of the flabber year old platform companies
Speaker 1: that are doing some of these layoffs.
Speaker 3: Alik, we were just speaking with Kaifu Lee a little
Speaker 3: bit earlier, who does feel that there's going to be
Speaker 3: a limitation on these big tech juggernauts that have been
Speaker 3: so ahead of the curve in AI development thus far,
Speaker 3: But it's going to lead to cannibalization of their own
Speaker 3: business models and ultimately they're not going to be AI first.
Speaker 3: Are all of the companies that you're backing now ultimately
Speaker 3: AI first companies or are they having to re establish themselves.
Speaker 3: We think about their headcount, We think about the way
Speaker 3: in which their business model works, for example, like a grammarly.
Speaker 1: Yeah, so not all of them are necessarily AI first.
Speaker 1: For a lot of them, AI will be a new
Speaker 1: tool in their toolkit. The most exciting examples of an
Speaker 1: AI first company the one that leads to mind. I'm
Speaker 1: speaking to you today from Italy, and I spent today
Speaker 1: visiting with a company we're backing in Switzerland called key
Speaker 1: in Health Ayaan and they are using AI to provide
Speaker 1: mental health services into big companies and they're doing so
Speaker 1: AI first, something like this wouldn't have been possible. Providing
Speaker 1: AI enabled enabling mental health services to tens of thousands
Speaker 1: of employees that has a human component on the back
Speaker 1: end but has an AI component on the front end.
Speaker 4: That kind of thing wouldn't have been possible years ago.
Speaker 1: And so this, ultimately, I think is showing what AI
Speaker 1: and can do to help the world a little bit.
Speaker 2: Alec Ross Techic analyst and board member at AMPLO, thank you.
Speaker 4: So much for your time.
Speaker 2: Let's get back to Bioage Labs, which we mentioned earlier,
Speaker 2: just to announce the close of a one hundred and
Speaker 2: seventy million dollars Series D round to develop new therapies
Speaker 2: for metabolic diseases using the power of AI. Co founder
Speaker 2: and CEO Christin Forney joins us. Now, so I guess
Speaker 2: it's a d What is it that you need to
Speaker 2: invest in in the context of AI. Help us understand
Speaker 2: how AI will ultimately accelerate I guess the work that
Speaker 2: you're doing.
Speaker 8: Sure, kirst and thanks for having me. It's really great
Speaker 8: to be here. So how we use AI at Bioage
Speaker 8: is really to understand human aging. So human biology is
Speaker 8: incredibly complicated. You have, for example, tens of thousands of
Speaker 8: proteins in your body, each with a different role to
Speaker 8: play in health and disease, and it's fundamentally a data
Speaker 8: question to figure out which proteins matter for certain processes
Speaker 8: versus others.
Speaker 4: And at bio read.
Speaker 8: If you really study what makes individuals, helps individuals live
Speaker 8: long and live healthy for that for a long period
Speaker 8: of time, right, because some people are very healthy well
Speaker 8: into their nineties, they're still very physically capable, still very
Speaker 8: mentally capable. So AI for us is really at the
Speaker 8: beginning of the funnel helping do target ID and now
Speaker 8: with this financing, this incredible Series D finance, but that's
Speaker 8: really going to power as our clinical development. So phase
Speaker 8: two clinical trials of our lead drug.
Speaker 3: For obesity and that you're doing in combination with Eli Lilly,
Speaker 3: and I'm interested as to how much you have to
Speaker 3: go hand in hand with the older god those that
Speaker 3: are already bringing these to market.
Speaker 8: That's a really great question. So our drug, which improves
Speaker 8: muscle and metabolic function, really shines in combination with these
Speaker 8: increten drugs, these drugs that Lily and Novo are are
Speaker 8: currently building. So for the phase true trial, we're going
Speaker 8: to be combining our drug together with one of these
Speaker 8: with Lily's drug to show if we can increase the
Speaker 8: quantity of weight loss so that get more weight loss
Speaker 8: as well as the quality of weight loss, to have
Speaker 8: it be really healthier weight loss with a better balance
Speaker 8: of muscle the fat at the end of the treatment.
Speaker 8: Importantly too, our drug is an oral drug. It's a pill,
Speaker 8: and the future here is really to instead of having
Speaker 8: to reject yourself all the time, have a weight loss
Speaker 8: pill that achieves the weight loss that you need and
Speaker 8: in a healthy way.
Speaker 4: Kristin what's your biggest cost? Real quick? We had thirty seconds.
Speaker 2: In the funds that you've gained, what are you going
Speaker 2: to spend on headcount or software or compute?
Speaker 8: For sure? So for a biotech, the largest cost is
Speaker 8: the clinical trial itself. So you're going to require hundreds
Speaker 8: of people that are taking your drug for months at
Speaker 8: a time and look at a really comprehensive battery of tests,
Speaker 8: so that more than the headcount or the software is
Speaker 8: the big cost user.
Speaker 5: Well, so you put that money to work. Tell us
Speaker 5: how trials go come back on the show.
Speaker 3: Bioah Labs co founder CEO Kristin Fortney on that one
Speaker 3: hundred and seventy million dollar raise.
Speaker 5: Meanwhile, well that does it for this edition.
Speaker 3: Of Bloomberg Technology Comraine sun or snow or bring it
Speaker 3: to air here in New York.
Speaker 5: But so much to digest that.
Speaker 2: Yeah, and it's a big week for the gig economy.
Speaker 2: I really think this is going to be something that
Speaker 2: we'll be talking about and learning a lot about the
Speaker 2: world we live in through those earnings. Check out the
Speaker 2: pod recap, the conversations Apple, Spotify, iHeart from a snowy,
Speaker 2: blizzardy New York City and a standard luke warm sunny
Speaker 2: San Francisco.
Speaker 4: This is Bloomberg