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Speaker 2: Black Friday is certainly underway. We got a great live
Speaker 2: blog on the Bloomberg terminal that's following reporters who are
Speaker 2: all over the country. Check it out because they're dispatched
Speaker 2: checking out the crowds, seeing what people are buying. Vonnie,
Speaker 2: a lot of people apparently in line to get the
Speaker 2: Taylor Swift book at Target.
Speaker 3: Did you hear about this?
Speaker 4: I'm loving this blog because we're just talking to people
Speaker 4: all over the huntry of these Moles of Paradise and
Speaker 4: Moles of America and all these different moles, and it's
Speaker 4: really fascinating. And yes, Taylor Swift merchandise is some of
Speaker 4: the best selling.
Speaker 5: I saw it today.
Speaker 4: I was down at Macy's and I saw massive crowds
Speaker 4: coming in by ten o'clock, and I think the weather
Speaker 4: had a lot to do with it. Tim So at
Speaker 4: six o'clock there weren't too many people around. It was
Speaker 4: twenty nine degrees six am six am when Macy's opened
Speaker 4: in Herald Square, but by ten am it was a
Speaker 4: little bit warmer, and you know, there was no rain.
Speaker 4: Everyone had been stuck indoors on Thanksgiving because it was
Speaker 4: so much rain in the Tristate area. At least people
Speaker 4: were out. They wanted to see what else, What are
Speaker 4: the discounts, what's available?
Speaker 3: What did it seem like there were discounts.
Speaker 4: It seemed like there were massive amounts of discounts. Everything
Speaker 4: was forty percent off or everything was fifty percent off.
Speaker 4: But I have to say one comment from our.
Speaker 5: Life blog really did strike me.
Speaker 4: This man that we spoke to, Jonathan Overton from DC, said,
Speaker 4: I don't really know what sales are going on, to
Speaker 4: be honest, there's not really a lot of signage.
Speaker 5: No one's really telling you what's happening.
Speaker 4: And I did feel a little bit like that because
Speaker 4: it was a bunch of merchandise and then you know
Speaker 4: at the side assigned with forty percent off and some
Speaker 4: small writing underneath, and it wasn't quite clear whether this
Speaker 4: was forty percent off the sale price or the full price,
Speaker 4: or you know, sort of a little bit of a
Speaker 4: grab bag.
Speaker 5: You get to the counter and you've out what you're
Speaker 5: going to own.
Speaker 2: Okay, so we got the great anecdotes from thirty fourth
Speaker 2: Street where you were at May season, from all over
Speaker 2: the country over on the live blog. We also want
Speaker 2: to get an idea for what data folks are seeing
Speaker 2: out there. For that, let's bring in Julie van Uhlin.
Speaker 2: She's Rakutin chief rewards, chief revenue officer. It's a cash
Speaker 2: back shopping platform. It's a subsidiary of the Internet Services
Speaker 2: giant Racketin Group.
Speaker 3: Good to have you with us, Julie.
Speaker 2: Just give people an idea of the insight that you
Speaker 2: have with this tool, because you know, if you're shopping online,
Speaker 2: you know about how you can how you can use
Speaker 2: this tool. But just give people some insight into the
Speaker 2: real time data that you get over at Racketin.
Speaker 6: Yeah, I'm happy to do that, and thanks for having
Speaker 6: me on this glorious Black Friday. Racketin is a massive
Speaker 6: shopping platform with the best rewards out there, especially this
Speaker 6: time of year, but all year round, where we have
Speaker 6: about five thousand brands who are working with us in
Speaker 6: order to attract the best shopping possible by offering rewards
Speaker 6: by way of cash back that are stackable on top
Speaker 6: of the amazing deals and promotions that are happening during
Speaker 6: big promotional periods like this.
Speaker 7: It's entirely free for consumers to join.
Speaker 6: We have about seventeen million consumers today and growing.
Speaker 4: And where are these consumers July because obviously you know,
Speaker 4: we're looking today, particularly at the US consumer, but Rocketon
Speaker 4: would have tentacles around the world, right we do.
Speaker 6: However, the business that we're discussing today and the data
Speaker 6: that the rich data that we'll talk about in terms
Speaker 6: of what we're seeing from a consumer behavior standpoint, is
Speaker 6: really a North American business racketin rewards.
Speaker 4: So you say seventeen million consumers sign up and roughly
Speaker 4: on average, you know, in a year, what kind of
Speaker 4: reward would a consumer expect to get.
Speaker 7: Oh, it's entirely dependent on the shopper. Right.
Speaker 6: It's a rewards platform that rewards a consumer for frequency
Speaker 6: and for average order value.
Speaker 7: Right. So the more you buy, the more.
Speaker 6: Likelihood it is that the brands that you love the
Speaker 6: most are going to be paying at ten to that
Speaker 6: and giving you more rewards to come back more frequently.
Speaker 6: So it really is engendering loyalty and frequency, and that's
Speaker 6: how the brands and retailers view us differently than what
Speaker 6: they can do on their own with their own base
Speaker 6: of shoppers.
Speaker 2: So we're already starting, you know, we're in the midst
Speaker 2: of the holiday shopping season, Julian, We're already starting, even
Speaker 2: in recent months to get some of those consultant reports
Speaker 2: out with how much they think consumers are going to spend.
Speaker 2: We talked about a Deloitte report out earlier this week
Speaker 2: that said that over the holiday period and especially today
Speaker 2: between today and Cyber Monday, consumers are expected to spend
Speaker 2: fifteen percent more than they spent last year six hundred
Speaker 2: and fifty dollars, So a new record there. What are
Speaker 2: you projecting over at Rakutin.
Speaker 7: It's been a really interesting year so far.
Speaker 6: I think that we are also projecting what would be
Speaker 6: a record year both online and also growing in store sales.
Speaker 6: But I think that a lot of the data that
Speaker 6: we've been showed going up until now over the past
Speaker 6: couple of weeks, as well as yesterday and even this morning,
Speaker 6: speaks to a couple of really interesting trends that are
Speaker 6: specific to this year. The first one I would say
Speaker 6: is around consumer intent. That we see consumers browsing less
Speaker 6: but shopping more. So we see on our platform sales
Speaker 6: are up, average order value is up, but browsing is
Speaker 6: a little lower. So I think that that speaks to
Speaker 6: perhaps the very intelligent consumer doing their research, making their list,
Speaker 6: checking it twice, and making sure that they are ready
Speaker 6: to pull the trigger when they see the best possible value,
Speaker 6: whether that value is by way of promotional discounts, cash back,
Speaker 6: free shipping, whatever it is, they're ready to go. And
Speaker 6: in tandem with that, I think it's also been a
Speaker 6: very by now moment since the week after the election,
Speaker 6: which is to say that we saw a fifty seven
Speaker 6: percent increase in shopping the week after the election versus
Speaker 6: the week and that has continued where there's been a
Speaker 6: record amount of early shopping happening. So I think that
Speaker 6: again speaks to the consumer sentiment, perhaps the turbulence from
Speaker 6: an economic standpoint, and then wanting to ensure that they
Speaker 6: get in now when they feel comfortable that they've gotten
Speaker 6: the offer that's good enough for them.
Speaker 4: Julie, you say you have a mound of rich data,
Speaker 4: and I'm just curious who is the Rocket and Rewards
Speaker 4: sign or opers. So there's so many rewards programs out
Speaker 4: there now, and you know, no matter where are you shop,
Speaker 4: it seems like you're invited to be part of the
Speaker 4: loyalty program. What would the niche sort of offering of
Speaker 4: Rocket and Rewards be that would make me want to
Speaker 4: sign up for yet another program?
Speaker 6: I think the really interesting part about what we do
Speaker 6: is that it runs the gamut of categories, So we
Speaker 6: aren't even just focused on traditional retail categories. We yes
Speaker 6: certainly have the apparel, health and beauty categories that folks
Speaker 6: are so interested in buying this time of year, consumer electronics,
Speaker 6: but also verticals like travel, like consumer banking and financial products.
Speaker 6: So given the fact that it's a one stop shop
Speaker 6: for being able to kind of weigh the value of
Speaker 6: what brands are willing to deliver across categories, it's particularly
Speaker 6: fascinating to consumers in a way that spans the gamut
Speaker 6: that a singular rewards platform might not be able to do.
Speaker 2: Julie, what do you get out of the Rakertin rewards
Speaker 2: program in the sense as a company, you know you
Speaker 2: have to entice people to use it. Do you get
Speaker 2: paid by the retailer, or is the data so powerful
Speaker 2: that you can then make money selling it.
Speaker 7: That's a great question, and it's a very simple model.
Speaker 6: We are highly protective of consumer data and we are
Speaker 6: in no way, shape or form interested in using it
Speaker 6: from monetization. The model is entirely an advertising model, whereby
Speaker 6: all of the brands and retailers with whom we work
Speaker 6: see our platform as a way to get access to
Speaker 6: shoppers who will shop more frequently and buy more when
Speaker 6: they get that cash back, which is effectively the permission
Speaker 6: to buy that they need, and when they give us
Speaker 6: those advertising dollars, just like any media platform that would
Speaker 6: get advertising dollars, we simply pass about half of those
Speaker 6: dollars back to the shopper in the form of cash back.
Speaker 4: So we were talking earlier about the you know, the
Speaker 4: amount that somebody spends then dictating.
Speaker 5: How much they get back in rewards.
Speaker 4: But you must have an average figure or even a
Speaker 4: mean figure for the rocket and rewards devote.
Speaker 5: Hey, let's say.
Speaker 6: It's a very tough one, I'm afraid, but certainly what
Speaker 6: I think it speaks to is the fact that it
Speaker 6: varies year by year, in person by person.
Speaker 7: I did want to mention.
Speaker 6: One more trend to you, guys, which is super interesting
Speaker 6: this year, which is that we're seeing, still to this moment,
Speaker 6: as we're monitoring real time data, that there's this fascinating
Speaker 6: trend happening where it's a first me, then you season
Speaker 6: where and by that I mean shoppers seem to be
Speaker 6: shopping categories that are much less traditional giftable categories. They're
Speaker 6: very interested in areas like pet care, financial services, health
Speaker 6: and wellness, particularly CBS Walgreens.
Speaker 7: So what we see is.
Speaker 6: People out there again, probably because of concerns around potential
Speaker 6: economic trends. They're saying to themselves, I need to get
Speaker 6: myself shored up with these deals and my family shored
Speaker 6: up first before I move ahead to think about gifting.
Speaker 6: We do predict that that's likely to change shift over
Speaker 6: a little bit later today, especially as we go into
Speaker 6: the weekend in Cyber Monday, but it's a particularly interesting
Speaker 6: trend of consumers interested in using this moment a very
Speaker 6: high promotional free shipping, cash back stackability to do what's
Speaker 6: right for them and their family first.
Speaker 3: Julie.
Speaker 2: One thing we talk about a lot is what retailers
Speaker 2: who are traditional brick and mortar retailers have to do
Speaker 2: to get consumers in the door, given that it's so
Speaker 2: easy to buy so much of this stuff online. What's
Speaker 2: the message that you have based on the data that
Speaker 2: you see what consumers are doing online to retailers who
Speaker 2: are trying to figure out this omnichannel approach.
Speaker 7: It's a great question.
Speaker 6: Part of our business is an in store capability whereby
Speaker 6: when a consumer links their credit card on our site,
Speaker 6: then you're able to achieve the same level of cash
Speaker 6: back that you might get online going in store when
Speaker 6: you use that credit card, and it just automatically happens.
Speaker 6: And that part of our business has grown dramatically year
Speaker 6: over year. And to answer your question, I think the
Speaker 6: reality is that we are dealing with a very value
Speaker 6: seeking consumer who isn't just content with discounts and prices
Speaker 6: that a brick and mortar might be able to offer,
Speaker 6: even during a time like Black Friday.
Speaker 7: They need to know that they're getting more.
Speaker 6: So a lever like cash back enables these retailers to
Speaker 6: offer something more that gives the consumer a permission to buy.
Speaker 6: What I will also say about retailers and brands is
Speaker 6: that there is certainly and this is more just holistically
Speaker 6: as an omni channel event is that there is a
Speaker 6: democratization around where brands can be purchased by consumers. And
Speaker 6: by that I mean retailers are in a way starting
Speaker 6: to compete with the direct to consumer brands themselves that
Speaker 6: they sell in their stores, because those brands may be
Speaker 6: able to offer higher cash back, but they may have
Speaker 6: a level to do things like free shipping with the
Speaker 6: larger infrastructure that they have. So it really is about
Speaker 6: figuring out what levers do you have and using.
Speaker 2: Them all right, Julie, let's leave it there. It's Julie
Speaker 2: van ullin Rakatin Rewards, Chief revenue Officer joining us on
Speaker 2: this Black Friday. Julie, thanks so much for taking the time.
Speaker 2: Always good to check in with you.
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Speaker 4: President elect Donald Trump had dinner with Meta CEO Mark
Speaker 4: Zuckerberg at his mar A Lago estate on Wednesday. Zuckerberg
Speaker 4: meeting with Trump and members of his team as the
Speaker 4: President elect prepares to return.
Speaker 5: To the White House in just fifty two days.
Speaker 4: Now for more, we're joined by Bloomberg's Kurt Wagner.
Speaker 5: Kurt, do you know anything about the conversation.
Speaker 4: I know, representatives for Zuckerberg did let out a few
Speaker 4: little comments they did.
Speaker 8: They were very vague.
Speaker 9: They said, you know that it was an important time
Speaker 9: for innovation, which is one of the things that they
Speaker 9: want to talk about. I think we can extrapolate from
Speaker 9: that a little bit to assume that they probably touched
Speaker 9: on AI, because this is something that's been a key
Speaker 9: priority for Meta over the past year, year and a half.
Speaker 9: They're investing very, very aggressively in all types of AI
Speaker 9: products and features, and as you can imagine, there's a
Speaker 9: lot of concern about what the incoming administration might do
Speaker 9: in terms of regulation with AI. So I do think,
Speaker 9: you know, that hint about innovation, to me is a
Speaker 9: sign that AI was probably at least one of the
Speaker 9: many topics of conversation at that dinner.
Speaker 2: Maybe I'm a cynic, but my takeaway, Kurt, and you
Speaker 2: know this better than I to, was not that at all.
Speaker 2: I mean, my first reaction was, like Mark Zuckerberg's got
Speaker 2: to get on the Trump administration's good side, given what
Speaker 2: we've heard on the campaign trail. Now that Elon Musk
Speaker 2: is their NonStop, and we know that Elon doesn't have
Speaker 2: a great relationship with Mark Zuckerberg. These guys are like nemeses.
Speaker 2: I mean, am I too cynical here?
Speaker 8: No?
Speaker 9: I definitely feel like there's a little bit of damage
Speaker 9: control being done here, right, And it's not just from
Speaker 9: the last couple months. I mean, remember two years ago,
Speaker 9: or I guess more than two years ago. At this point,
Speaker 9: Donald Trump was suspended from Facebook and Instagram for two years, right,
Speaker 9: and that created a huge issue since then. When he
Speaker 9: was on the campaign trail, he talked about, you know,
Speaker 9: wanting to keep TikTok around simply because he knew if
Speaker 9: TikTok was gone it would help Facebook. He even insinuated
Speaker 9: that he might want to try to put Mark Zuckerberg
Speaker 9: in jail.
Speaker 1: Right.
Speaker 8: That was just a few months ago.
Speaker 9: And so we've seen Mark Zuckerberg sort of in the
Speaker 9: last couple months since this summer, really you know, say
Speaker 9: flattering things about Donald Trump. He called the president elect
Speaker 9: before he was elected back in the fall. Now he's
Speaker 9: showing up at mar A Lago for dinner. I think
Speaker 9: your instinct is pretty spot on, which is that this
Speaker 9: has been a tumultuous relationship for several years now, and
Speaker 9: it's certainly in Mark Zuckerberg's best interest to make sure
Speaker 9: that Donald Trump at the very least things him as neutral, right,
Speaker 9: so that he's not coming after him and attacking his businesses.
Speaker 7: For sure.
Speaker 4: And he did make a comment after the assassination attempt,
Speaker 4: the first one saying seeing Donald Trump get up after
Speaker 4: getting shot on the face and Pump's fist in the
Speaker 4: air with the American flag is one of the most
Speaker 4: badass things I've ever seen in my life. So he
Speaker 4: has been quite you know, complimentary of the president elect.
Speaker 4: What could the president elect do though, and just in
Speaker 4: terms of the company, not Zuckerberg personally. You know, you
Speaker 4: can blacklist him from mar A Lago. He can do
Speaker 4: whatever he wants to Zuckerberg personally, but he would need
Speaker 4: someone like Alena Khnon board to actually hurt the company,
Speaker 4: you know.
Speaker 9: I think, well, it sort of depends on what you
Speaker 9: described by hert or what you mean by her right.
Speaker 9: I think what we saw after the twenty sixteen election
Speaker 9: was that Facebook really got bogged down with you know,
Speaker 9: all of these claims of Russian interference and Mark Zuckerberg
Speaker 9: being summoned to d C every year to answer these questions.
Speaker 8: It's just a lot of distractions, right.
Speaker 9: I feel like that's the kind of world that Donald
Speaker 9: Trump and Congress could create for Mark Zuckerberg.
Speaker 8: They could just make his life much less enjoyable.
Speaker 9: Now, on top of that, as you guys mentioned, Elon
Speaker 9: Musk is in the picture right, and Elon and Mark
Speaker 9: Zuckerberg are not friends.
Speaker 8: They have a very healthy rivalry.
Speaker 9: And so you know, now you have the president's sort
Speaker 9: of top advisor who's an anti Facebook guy. And so
Speaker 9: I do think that there's this, you know, potential threat
Speaker 9: that the administration could simply make Mark Zuckerberg's path these
Speaker 9: next four years very difficult if they want to. And
Speaker 9: so that's again why you see him showing up to
Speaker 9: have dinner the night before Thanksgiving.
Speaker 3: Kurt.
Speaker 2: There's this idea, and we saw this actually play out
Speaker 2: a few months ago in the vice presidential candidate debate
Speaker 2: with JD Vance talking about censorship on social media platforms
Speaker 2: and this idea of this anti conservative bias. And you know,
Speaker 2: I haven't seen these numbers in a while. But what
Speaker 2: we have tended to see is that actually Facebook as
Speaker 2: a social platform is really good to conservatives in terms
Speaker 2: of the most prominent voices. You know, they get a
Speaker 2: lot of their traffic coming from the social platform. Is
Speaker 2: there any credence to the idea that there is anti
Speaker 2: conservative bias on some of these social platforms that that
Speaker 2: Zuck and company run.
Speaker 9: I mean, gosh, Tim, We've been talking about this for
Speaker 9: years at this point, right, and I feel like it's
Speaker 9: always sort of been a perceived bias, right. I think
Speaker 9: if you no one's really come out and shown real
Speaker 9: hard figures to say like, hey, look, the companies are
Speaker 9: intentionally down ranking someone simply because they are conservative or
Speaker 9: simply because they are liberal. What I find very interesting
Speaker 9: is that ever since Elon Musk took over X, certainly
Speaker 9: these past six months, he has been the most pro
Speaker 9: you know, Trump owner of any CEO or excuse we have,
Speaker 9: any social platform we've ever seen. And yet there have
Speaker 9: been no concerns about that, Right, There's been no concerns
Speaker 9: on the other side that hey, what about you know,
Speaker 9: you're suppressing left leaning voices or you're suppressing you know, democrats, right,
Speaker 9: and so I just find it very interesting that for
Speaker 9: years we heard about this anti conservative bias when there
Speaker 9: was a perceived attack, and now when we have a
Speaker 9: CEO and owner who's very blatant and openly picking a
Speaker 9: side at political side, no one seems to have an
Speaker 9: issue with that, right, So it is a very interesting dynamic.
Speaker 9: I don't know, this narrative has sort of died down
Speaker 9: a little bit on the Facebook front, but now that
Speaker 9: Trump is back in office, I wouldn't be shocked if
Speaker 9: we start to hear this thing come up again.
Speaker 4: Just briefly, cards the representatives for Zuckerberg said that the
Speaker 4: conversation was taking place at a crucial time for US innovation.
Speaker 4: I'm just curious, is there any chance that the two
Speaker 4: would have spoken about bydowns and what Donald Trump should
Speaker 4: do about TikTok.
Speaker 9: I mean, I'd be speculating, but it seems very logical
Speaker 9: that would be top of mind that date. The January
Speaker 9: date for the potential ban of TikTok is just a
Speaker 9: few months away. Donald Trump talked about it on the
Speaker 9: campaign trail. We obviously know it matters a lot to meta, right.
Speaker 9: I think if TikTok is out of the Picture Meta
Speaker 9: stands to benefit more than any other company out there,
Speaker 9: so I do have have to imagine that that came up.
Speaker 9: It's probably a little bit of a tricky situation because
Speaker 9: Mark Zuckerberg has to sit here and probably he can't
Speaker 9: say exactly what's maybe on his mind right for anti
Speaker 9: competitive reasons. But I again, the timing is such that
Speaker 9: it's hard to imagine it wouldn't have at least been
Speaker 9: brought up.
Speaker 4: Kurt, Thank you so much for following all of this
Speaker 4: so closely. For us, that is Kurt Wagner, and we
Speaker 4: will be talking to him again no doubt.
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Speaker 2: Officials rejecting the busiest Thanksgiving travel season yet still going
Speaker 2: to see some final numbers in the coming days, but
Speaker 2: check this out. In the past two days alone, the
Speaker 2: TSA has screened more than four point two million passengers.
Speaker 2: Join us now to share with us what travel trends
Speaker 2: he's seeing as the season kicks off. Is Clint Henderson,
Speaker 2: the Points Guy, Managing editor, Clint, I'm always good to
Speaker 2: see you. Have things gone off without a hitch so.
Speaker 10: Far, you know, remarkably, I was a little nervous about
Speaker 10: yesterday because we had all those storms across the country.
Speaker 10: The airlines were covered really quickly. I do feel like
Speaker 10: all the staffing moves they've made over the past couple
Speaker 10: of years are starting to pay dividends. You know, a
Speaker 10: lot of airlines have invested in technology after spectacular meltdowns.
Speaker 11: I think all that's paying dividends.
Speaker 10: The one area I'm really worried about still is air
Speaker 10: traffic control staff shortages.
Speaker 11: So that's something I'm.
Speaker 10: Watching closely, especially in Newark. But other than that, it's
Speaker 10: been really smooth.
Speaker 5: Why are there shortages.
Speaker 10: It's a job that's really hard. It's really stressful, especially
Speaker 10: in the Northeast region, the busiest part of the country.
Speaker 10: You know, you've got Newark Airport, You've got JFK, You've
Speaker 10: got LaGuardia. Imagine the number of planes coming in and
Speaker 10: out of the area. One of the reasons we've seen
Speaker 10: a little bit of an issue with ATC is because
Speaker 10: they've moved Newark Control over to Philadelphia to try to
Speaker 10: ease the training issues.
Speaker 11: And so twenty.
Speaker 10: Four ATC workers moved over to the Philly area. And
Speaker 10: you know it's going to take some time. It's a
Speaker 10: long term solution to a long term problem. This has
Speaker 10: been a problem for years. Apparently a bunch of the
Speaker 10: people that they train end up dropping out because it's
Speaker 10: just too stressful. So that's a little bit of the
Speaker 10: back seat there.
Speaker 2: Okay, Clint, I want to shift gears a little bit
Speaker 2: because now is the time of year where the airlines
Speaker 2: start coming out with updates to their rewards programs. Delta's
Speaker 2: certainly taken a little bit of heat for changing its
Speaker 2: rewards program around. At the end of the day, are
Speaker 2: these rewards programs actually still worth it given what you
Speaker 2: get in as a reward, and given how hard it
Speaker 2: is to achieve certain levels of status.
Speaker 10: So you put your finger on the raging debate in
Speaker 10: the points in Miles world right now, a lot of
Speaker 10: my coworkers are giving up on top tier status. You're
Speaker 10: not getting the upgrades you used to get. There's more people,
Speaker 10: it seems like in the top tiers and the juice
Speaker 10: is just not worth the squeeze for some people. Now
Speaker 10: that said, I am going to keep Delta Diamond and
Speaker 10: American Airlines Executive Platinum because I'm a tux.
Speaker 11: Yeah but I will.
Speaker 10: But that's not going to continue long term because it's
Speaker 10: gotten too expensive. So one of my colleagues in the
Speaker 10: United program is going to drop down to gold this year.
Speaker 10: It's just it's getting harder to redeem points in miles
Speaker 10: and you have to be more aggressive and more invested
Speaker 10: into how to maximize it to squeeze out the perks.
Speaker 10: But here's what I will say. We're still seeing a
Speaker 10: ton of deals. There's still good sign up bonuses, there's
Speaker 10: still amazing business class redemptions you can get on programs
Speaker 10: like Air France or Air Canada Aeroplan. We do see
Speaker 10: those those unicorn fairs we call them, even in the
Speaker 10: US program. So for me, that's why I'm still all in,
Speaker 10: even though I'm not getting upgraded on most of my
Speaker 10: flights these days.
Speaker 4: What about the hotels, Clint, You know, some of the
Speaker 4: branded hotels are perhaps worth signing up to their loyalty
Speaker 4: programs for because you may eventually get a night for free.
Speaker 4: But some you know, you really have to spend a
Speaker 4: lot of time in them. I'm thinking of JAMAIRA and
Speaker 4: some of these really top to your hotels.
Speaker 11: Yeah, and the truth is or seasons, some of these other.
Speaker 5: Programs don't even have loyalty programs.
Speaker 11: Right exactly. So that's the thing for me that I know.
Speaker 2: Yeah, I was, how do you know that that's pretty impressive?
Speaker 3: So you're staying at.
Speaker 10: The Yeah, that's why my team focuses on Hyatt, Hilton
Speaker 10: and IHG and Marriott because we know we're going to
Speaker 10: get something for all those days we're putting in. But
Speaker 10: I will say World of Hyatt to me gets the
Speaker 10: gold crown because they really do take care of their
Speaker 10: best customers. If you get sixty nights a year, you
Speaker 10: get upgrade certificates, there's all kinds of goodies, and their
Speaker 10: points have not been devalued like some other programs have.
Speaker 10: So you can stay at a park Hyatt anywhere in
Speaker 10: the world for thirty forty thousand points.
Speaker 11: So to me, that's a really valuable program.
Speaker 2: Okay, so hotel is still some value out there to
Speaker 2: be found.
Speaker 3: Airlines.
Speaker 2: Perhaps my problem with these airline loyalty programs, Clint is
Speaker 2: if you get to the next level and something, it
Speaker 2: basically oftentimes just means you can check another bag, Like
Speaker 2: I'm not seeing the actual value here.
Speaker 3: You're not.
Speaker 2: It doesn't seem like you're being treated any different. You're
Speaker 2: not getting space at the front of the plane. It's
Speaker 2: sort of like kind of a joke.
Speaker 1: Now.
Speaker 10: Yeah, So it's a really big problem for the last
Speaker 10: minute business travelers because if you're flying Delta, for example,
Speaker 10: hub to hub, you're not going to get even a
Speaker 10: main cabin extra seat, even if you have taught your status,
Speaker 10: because those seats are all sold. They're all gone. And
Speaker 10: that's just coach. That's not even to say upgrade list.
Speaker 10: I've seen upgrade list of fifty people, fifty five people.
Speaker 10: So yes, it is a truth that if you want
Speaker 10: first class these days, you have to buy first class.
Speaker 10: I will say, though, even gold level status on most
Speaker 10: of the airline programs, if you're booking a month out,
Speaker 10: you're still going to be a to get extra leg
Speaker 10: room seats, extra baggage allowance, early boarding, and a possibility
Speaker 10: of an upgrade. So for me, there's still some value
Speaker 10: to be had there. It's just getting harder and harder
Speaker 10: to the possibility.
Speaker 2: Okay, maybe, Hey, before we let you go, Clinn, I
Speaker 2: want to talk a little bit about what twenty twenty
Speaker 2: five is looking like. It certainly seems like this year
Speaker 2: and last year were huge years for Americans traveling to
Speaker 2: and from Asia. A lot of folks, at least anecdotally,
Speaker 2: who I spoke to, a lot of colleagues making some
Speaker 2: big trips to Japan and the like. What's hot comes
Speaker 2: twenty twenty five, so.
Speaker 11: You hit it. Japan is hot, remains hot.
Speaker 10: The the US dollar wo yes, very In fact, that's the
Speaker 10: one part of the world that I'm not seeing a
Speaker 10: lot of deals. So you're still not seeing I'm seeing
Speaker 10: five hundred dollars sub five hundred dollars round trip coach
Speaker 10: fairs to Europe regularly. I'm not seeing those same deals
Speaker 10: to Japan these days. And Australia and New Zealand also
Speaker 10: very hot. But you want to go where the US
Speaker 10: dollar is stronger, especially if you can find a.
Speaker 11: Decent price ticket.
Speaker 10: I'm going back to Japan, but I'm using points of
Speaker 10: miles for my trip.
Speaker 11: So you got to be smart about these things.
Speaker 4: Okay, So we need to know a little more detailed
Speaker 4: where with carriers.
Speaker 10: Okay, So I used Alaska miles to book Starluck's a
Speaker 10: New Asian New Taiwanese airline in business class seventy thousand
Speaker 10: miles one way. And then I was able to use
Speaker 10: American Airlines miles to book Japan Airlines via American for
Speaker 10: sixty thousand miles in business class. So the deals are
Speaker 10: out there. You just have to really hunt and peck,
Speaker 10: and you have to you have to educate yourself a
Speaker 10: little bit on points and miles.
Speaker 11: But the deals are there, I promise, do you.
Speaker 2: I mean, I've tried to do the things that I
Speaker 2: see online on sites like yours Clint, where it's like, okay,
Speaker 2: sign up for this plan because then you can redeem
Speaker 2: miles for this domestic carrier, and have never had any
Speaker 2: luck doing it. It's like sign up for the international plan,
Speaker 2: do a search that way, and there's still no flights.
Speaker 3: Like, what's the secret?
Speaker 10: Yeah, So this secret is flexible calendar is flexible dates.
Speaker 10: So if you're if you want to travel when every
Speaker 10: other family wants to travel for spring break, you're probably
Speaker 10: not going to score. But if you can hunt and
Speaker 10: peck and find that availability, plans like Air France Flying
Speaker 10: Blue KLM their program. I like the Aeroplane Air Canada
Speaker 10: program because you can usually find availability. It's just sporadic,
Speaker 10: so you just have to really hunt and peck. And
Speaker 10: the other thing is there's these new points search startups
Speaker 10: like points Me that you can sometimes find in big
Speaker 10: sweeping searches of the calendar. You can find those those
Speaker 10: dates that do have that Unicorn availability.
Speaker 4: So kening those sub five hundred dollars Europe trips so regularly.
Speaker 10: American Airlines right now has a Black Friday sale under
Speaker 10: five hundred dollars from cities like Charlotte. From cities like
Speaker 10: New York to London for under five hundred dollars round trip.
Speaker 10: But tap air Portugal some of the you're lesser known
Speaker 10: Europe go.
Speaker 4: To cost eight hundred dollars to get from New York
Speaker 4: to Charlotte's well.
Speaker 10: But those flights are available from New York to London
Speaker 10: under five hundred dollars on American Airline.
Speaker 3: Just take the bus, take the bus to Charlotte.
Speaker 5: I don't need to yeah, I just need my American in.
Speaker 11: London American Airlines.
Speaker 2: Yeah, Hey, it's what about sort of warm places to
Speaker 2: go as it gets cold outside. What are you seeing
Speaker 2: over the Christmas holiday and what are you seeing in
Speaker 2: the early part of January for like President's Weekend and stuff.
Speaker 10: Yeah, so hot tip the places that were the hottest
Speaker 10: coming out of the pandemic, so Florida, Hawaii, Las Vegas.
Speaker 10: Those are on sale now, so we're seeing more reasonable prices.
Speaker 10: And Maui regularly, I'm seeing three hundred dollars under three
Speaker 10: hundred dollars round trip tickets. The problem with Maui is
Speaker 10: the hotels were still pretty expensive, but there are deals
Speaker 10: to be had to places that maybe you didn't get
Speaker 10: to go to out of the pandemic because they were
Speaker 10: just too expensive, including Miami and including what is like Maui,
Speaker 10: Kawaii and Hawaii.
Speaker 2: Glenn Henderson managing at her at the Points Guy. Next
Speaker 2: time I have a Points question, I'm just going to
Speaker 2: send him an email. I got these United plants. They
Speaker 2: feel like they're not worth anything because I can never
Speaker 2: find a flight.
Speaker 1: You're listening to the Bloomberg Business Week podcast. Listen live
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Speaker 4: Uriam Timmer is Director of Global Macro at Fidelity Management
Speaker 4: and Research. We were just saying a little bit earlier, Urian,
Speaker 4: that this has been quite the fall and winter for macro,
Speaker 4: global macro, in particularly US macro. There was a lot
Speaker 4: of surprises now in a season where we weren't quite
Speaker 4: sure that we'd be that many surprises.
Speaker 12: It sure has and by the way, it's a pleasure
Speaker 12: to be here. But really the last four years has
Speaker 12: been full of surprises. Really that we're still dealing with
Speaker 12: sort of the how to interpret market cycles in the
Speaker 12: aftermath of the pandemic of course, and all the things
Speaker 12: that change. You know, two years ago with the inverted curve,
Speaker 12: we roll expecting that recession, and here we are with
Speaker 12: the economy remaining quite resilience, resilient inflation or at least
Speaker 12: the rate of inflation getting closer to the FEDS target,
Speaker 12: although it is being more stubborn in the last few months,
Speaker 12: with the core PC now taking higher to two point eight.
Speaker 12: But the earnings have come through and that is the
Speaker 12: most important thing, you know, you ask anyone at Fidelity
Speaker 12: in Boston at the Mothership. It's price follows earnings, and
Speaker 12: earnings is what we are looking at. And earning season,
Speaker 12: of course is pretty much over nine percent growth year
Speaker 12: over year, and the growth rate for the calendar year
Speaker 12: will be around ten percent. It looks like this year
Speaker 12: and expectations for twelve next year that might come down
Speaker 12: a few points. But you know, if we are getting
Speaker 12: into an animal spirits cycle after the fairly decisive election,
Speaker 12: and a new capital formation cycle begins, and the AI
Speaker 12: boom already is sort of forcing all companies to go
Speaker 12: into the CapX mode. The hope is, of course that
Speaker 12: we get a true productivity boom. We'll have to see
Speaker 12: if it actually happens. But if that's the case, then
Speaker 12: you can get a higher sort of speed limit for
Speaker 12: the economy, which means the economy can grow faster without
Speaker 12: inflaming the inflation rate, right, and I think that is
Speaker 12: the great hope for this market. My biggest not a concern,
Speaker 12: but I think one of the impediments will be next
Speaker 12: year that this is not like twenty seventeen, right when
Speaker 12: the first term of the president started, and obviously we
Speaker 12: had the tax cuts happening in twenty seventeen. That year
Speaker 12: was a very robust bull market, led by both earnings
Speaker 12: growth and valuation expansion. But you know, rates from much lower.
Speaker 12: The FED was barely off of zero. Back then, inflation
Speaker 12: was not a story. And in twenty twenty five, you know,
Speaker 12: that is a different landscape. And so one of the
Speaker 12: things that I look at is interest rates. You know,
Speaker 12: the ten years behaved, it's four twenty, it was at
Speaker 12: closer to four fifteen. It was at five percent a
Speaker 12: year ago, and so so far, so good there, but
Speaker 12: occasional flare ups in yields. I think is likely to
Speaker 12: be not a bull market ender, but at least an interrupter.
Speaker 2: There's this policy proposal or a series of policy proposals
Speaker 2: from the Trump administration that we got on the campaign trail,
Speaker 2: and I'm wondering how you're factoring that into your analysis.
Speaker 3: And it's the.
Speaker 2: Idea that, Okay, if these if he goes through with
Speaker 2: these tariffs that he actually announced earlier this week, what
Speaker 2: could that do to inflation here in the US? And
Speaker 2: then also what about mass deportations? And whenever I talk
Speaker 2: about this, I say, obviously the human can you know
Speaker 2: the human side of the story, putting that aside, and
Speaker 2: just thinking about the economic effects of deporting millions of
Speaker 2: people over a short period of time, many of whom
Speaker 2: do work in jobs here in the US. So I'm
Speaker 2: wondering what you're looking at in terms of economic shocks there.
Speaker 12: Yeah, it is a concern, and of course no one
Speaker 12: really knows whether the tariffs are going to be just
Speaker 12: a bat that the president carries around to try to
Speaker 12: get better deals. I mean, certainly the announcements with Mexico
Speaker 12: and then the meeting or the phone call with the
Speaker 12: Mexican president kind of give an indication that this is
Speaker 12: really to start negotiations for better trade deals. But it
Speaker 12: of course is a risk because if importers have higher costs,
Speaker 12: they either need to pass those on to consumers or
Speaker 12: it eats into their profit margins. And then it's a
Speaker 12: question of to what degree other things offset. Right, the
Speaker 12: dollar is very strong, so that would be an offset,
Speaker 12: for instance, So it remains unclear to what degree it
Speaker 12: would be inflationary, and of course deportations would presumably be
Speaker 12: inflationary as well. And if you think about what the
Speaker 12: FED and the economy has accomplished in the last couple
Speaker 12: of years, right with the great reset in twenty twenty two.
Speaker 12: The FED was trying to obviously slay the inflation dragon,
Speaker 12: which it has at least partially done, and it was
Speaker 12: trying to rebalance the labor market, which was in overdrive
Speaker 12: back then, right because the economy when it shut down
Speaker 12: during COVID, obviously many people left the labor force, and
Speaker 12: then when it reopened, those people did not return right away,
Speaker 12: so that there were lots of job vacancies that were unmet.
Speaker 12: Now that supply has returned, and immigration, I think is
Speaker 12: certainly part of that, and so the labor market is
Speaker 12: in perfect balance right now. It has reset itself, not
Speaker 12: through layoffs but through people coming back in. If you
Speaker 12: start deporting people who are working in the labor force,
Speaker 12: obviously you run the risk that you then upset that.
Speaker 4: Balance, right exactly, So, if the market is only expecting
Speaker 4: two to three interest rate costs next year, should it
Speaker 4: really be rethinking that in the sense that the FED
Speaker 4: should possibly get in front of some.
Speaker 3: Of this, Yes, I think so.
Speaker 12: So the FED is cut, of course twice by fifty
Speaker 12: and by twenty five. I look at various iterations of
Speaker 12: the tailor rule. Of course, the rule made famous by
Speaker 12: John John Taylor back in the early nineties, and no
Speaker 12: matter how you slice it, the Fed is in the
Speaker 12: right place having cut rates a few times, like the
Speaker 12: tailor rule completely supports lower rates than they were. But
Speaker 12: going forward it is by no means clear that a
Speaker 12: lot more rate cuts are in line. And of course,
Speaker 12: when we started this year, the market was expecting seven
Speaker 12: rate cuts just this calendar year, and then a few
Speaker 12: months ago and we had the growth scare, it was
Speaker 12: down to a two handle on the terminal rate. Now
Speaker 12: you know we got sixty six percent chance of a
Speaker 12: rate cut in December. I think the Fed can go
Speaker 12: either way. The economy obviously is not falling off a
Speaker 12: cliff waiting for another rate cut. But my sense is
Speaker 12: that the Fed was right to do what they've done
Speaker 12: so far. But I would hold some more rate cuts
Speaker 12: in reserve rather than giving them to the markets and
Speaker 12: running the risk that you don't have to take them back,
Speaker 12: because I think one of the risks sort of economically
Speaker 12: is that inflation went from nine to three in twenty
Speaker 12: twenty two to now. If you look at the CPI,
Speaker 12: the core pc PCE went from six to two point eight,
Speaker 12: So inflation is better than it was, but it's still
Speaker 12: above two, right, and oftentimes the pendulum has to swing
Speaker 12: all the way through to stay at two. So if
Speaker 12: the economy now re accelerates at a time when inflation
Speaker 12: has not yet been slayed, you run the risk that
Speaker 12: then that reaccelerates and then the FED is in a
Speaker 12: much more difficult position.
Speaker 1: Yeah.
Speaker 2: I don't envy the job that Jay Powell has right
Speaker 2: now for many many reasons.
Speaker 3: Hey, I'm just finally switching gears.
Speaker 2: A little bit seven trillion dollars in cash on the
Speaker 2: sidelines right now, at least in money market funds as
Speaker 2: of just a couple of weeks ago.
Speaker 3: Where does that cash go?
Speaker 12: And when I've been asked that question so many times,
Speaker 12: and my sense has been so I follow this. You know,
Speaker 12: for Ally's one of the big players in the money
Speaker 12: market fund industry. So the way I look at the
Speaker 12: cash on the sidelines is I look at it as
Speaker 12: a percentage of the equity market cap. And there's a
Speaker 12: percentage of the market cap. It's around ten and a
Speaker 12: half percent, which is exactly in line with the historical average.
Speaker 12: So there's a lot of cash, but equities are worth
Speaker 12: a lot, So how much comes out and can it
Speaker 12: move the equity markets is to me the big question.
Speaker 12: But the caveat with the mountain of cash thing is like,
Speaker 12: for instance, during COVID, money went out of the stock
Speaker 12: market into money markets earning zero because people were panicking,
Speaker 12: and so that truly was a flight to quality trade then,
Speaker 12: which was then later reversed of course when the market
Speaker 12: was at a high. Right, it came out at the low,
Speaker 12: comes back in at new high. So it shows you
Speaker 12: the perils of market timing. This mountain of cash came
Speaker 12: out of the bank except two years ago during Silicon
Speaker 12: Valley bank and banks paying for half a percent. So
Speaker 12: there is some cash there, maybe a trillion, but it's
Speaker 12: not seventral.
Speaker 4: All right, Urian, we have to leave it there, But
Speaker 4: we got to the end of the answer.
Speaker 5: So thank you. That is Urian Timmer, who is.
Speaker 4: Director of Global Macro ad Fidelity Management and Research.
Speaker 5: Much much appreciated.
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