Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. This is Bloomberg business
Speaker 1: Week inside from the reporters and editors who bring you
Speaker 1: America's most trusted business magazine, plus global business, finance and
Speaker 1: tech news. The Bloomberg Business Week Podcast with Carol Messer
Speaker 1: and Tim Stenebek from Bloomberg Radio.
Speaker 2: I am looking at my Bloomberg looking at those FOMC
Speaker 2: minutes and they are just coming out. Mike McKee, you're
Speaker 2: on it.
Speaker 3: When they met guys, the Fed officials looked at the
Speaker 3: economy and saw that it was good. Rate cuts were justified,
Speaker 3: but caution also called for. Going forward. Growth was stronger
Speaker 3: than expected. Upside risks to inflation small and little change.
Speaker 3: Downside risks to the labor market had decreased. The outlook
Speaker 3: supported another quarter point cut in the federal funds range,
Speaker 3: although members were it pains the Minute say to note
Speaker 3: that policy was not a preset course. The dangers from
Speaker 3: letting policy get too tight match those from letting policy
Speaker 3: get too loose that they are data dependent. Among the
Speaker 3: upside risks to inflation, sudden disruptions to global supply chains,
Speaker 3: a larger than expected ease in financial conditions, stronger consumption,
Speaker 3: more persistent housing price increases, and those recent sharp increases
Speaker 3: in insurance costs that we have seen. Several participants noting
Speaker 3: that their contacts in companies larger in sectors like financial services, construction,
Speaker 3: professional services, technology were more optimistic than smaller firms and
Speaker 3: firms in manufacturing. Interesting thing, they did not mention at
Speaker 3: all the election in the minutes. Although strikes and hurricanes
Speaker 3: had affected recent labor market indicators, participants generally noted there
Speaker 3: was no sign of rapid deceleration in labor market conditions.
Speaker 3: Two other things to watch a discussion of financial stability
Speaker 3: and vulnerabilities that participants assessed warranted monitoring unrealized losses on
Speaker 3: bank assets and risks in commercial real estate, and one
Speaker 3: note for trading deesks. Some participants suggesting at a future
Speaker 3: meeting the committee consider a technical adjustment to the overnight
Speaker 3: reverse repot rate to set the rate equal to the
Speaker 3: bottom of the target range of the Federal funds rate.
Speaker 3: That would put it in alignment with the existing structure
Speaker 3: when the facility was established.
Speaker 2: All right, Michael McKee, Obviously they're at the Fed breaking
Speaker 2: down those latest FOMC minutes that of course from the
Speaker 2: November sixth, seventh FED meeting that was after the election.
Speaker 2: All right, Mike, big dump in terms of what you
Speaker 2: got from that release, You know, we go to you
Speaker 2: to kind of parse through it and what we need
Speaker 2: to know, what is the Bloomberg audience needs to know
Speaker 2: what stands out for you?
Speaker 3: If anything, well, not a lot stands out, because it's
Speaker 3: pretty much as has been described by FED officials since then,
Speaker 3: and of course, as Jay Powell described it in his
Speaker 3: news conference following the meeting, the conditions were pretty good
Speaker 3: for the economy, better than expected in terms of growth
Speaker 3: and unemployment. Inflation had stalled out a little bit, but
Speaker 3: they still didn't think it was going to be a
Speaker 3: problem to get it down to two percent, and so
Speaker 3: rake cuts were called for. But because the future was
Speaker 3: uncertain in terms of what was going to happen with
Speaker 3: inflation and the unmentioned labor election, rather, they wanted to
Speaker 3: make sure that people know they were data dependent and
Speaker 3: they are not on a preset course.
Speaker 2: Well, that's what kind of strikes me, Matt.
Speaker 3: Mike.
Speaker 2: One of the headlines that you mentioned, and it's what
Speaker 2: we call hot sticky right here at Bloomberg. You know
Speaker 2: that the FED saw some saw pause or faster cuts
Speaker 2: as options depending on data. So you know what have
Speaker 2: we been saying at nauseum right there? Data dependent? It
Speaker 2: sounds like they could go kind of anywhere, perhaps at
Speaker 2: the December meeting even but definitely in twenty twenty five.
Speaker 3: Well, definitely now the December meeting is open because the
Speaker 3: data have been mixed, and we have seen a little
Speaker 3: bit stronger inflation in both the CPI and PPI, and
Speaker 3: it's forecast to come out tomorrow in the PCE a
Speaker 3: little bit stronger. And if that's the case, then there
Speaker 3: is a case for pausing. We'll see what happens with
Speaker 3: the labor market. If the labor market comes in strong,
Speaker 3: if the jobs report on December sixth is strong, then
Speaker 3: you could probably start to bet on the idea of
Speaker 3: a pause in December. But you get the impression that
Speaker 3: they are at this point thinking they're going to go
Speaker 3: in December and maybe pause in January. Once we get
Speaker 3: the new administration in place. We're going to get a
Speaker 3: new summary of economic projections, a new dot plot in December,
Speaker 3: and how do you predict anything at this point?
Speaker 4: Well, that's where I wanted to go, and we are
Speaker 4: going to talk to you more about tariffs in just
Speaker 4: a minute, Mike, But we help us understand how the
Speaker 4: Federal Reserve thinks about potential policy from a new administration.
Speaker 4: We heard Jay Powell ask this question earlier this month
Speaker 4: at the press conference. But they do have to look
Speaker 4: at what tariffs could do to growth or what policies
Speaker 4: could do to growth in order to make these decisions.
Speaker 3: Right, Yes, but they have to look at, as you say,
Speaker 3: what it does to growth, or to inflation, or to
Speaker 3: the labor markets. And at this point they don't have
Speaker 3: any idea. There are a lot of slogans out there,
Speaker 3: there are a lot of tweets out there, but there
Speaker 3: isn't any policy out there. And until they have a policy,
Speaker 3: they can't really measure it. Now'll give you one example,
Speaker 3: and I know you want to move on to tariffs.
Speaker 3: We'll talk about this. This tweet that came out last
Speaker 3: night about tariffs from Canada and Mexico. There are something
Speaker 3: like forty billion dollars worth of automobile parts that come
Speaker 3: into the US from Canada and Mexico, but they crossed
Speaker 3: the border many times. There are some things like automobile
Speaker 3: seats that cross the border seven times how many times
Speaker 3: are those to be tariffed? Will they be tarffed? And
Speaker 3: that's the kind of thing that the FED doesn't know
Speaker 3: and it's impossible to model at this point.
Speaker 2: Well, that's what you know. I keep thinking about that, Mike,
Speaker 2: in that you know, Donald Trump imposed then President Donald
Speaker 2: Trump imposed tariffs during his first administration. They carried or
Speaker 2: some of them carried over right over into the body administration.
Speaker 2: And I am curious when I get to speak with
Speaker 2: someone like you, is you know, what impact did those
Speaker 2: tariffs have on US economic growth? What do they have
Speaker 2: on kind of the cost of things, the inflationary picture?
Speaker 2: Is there kind of a net tech takeaway as we
Speaker 2: now consider potentially another round of tariffs to come.
Speaker 3: Well, there have been a lot of studies on those tariffs,
Speaker 3: and there's two points you want to make. One is
Speaker 3: that there are some specifically targeted tariffs, especially Chinese electronic products,
Speaker 3: that are done for national security reasons. But the general
Speaker 3: tariffs basically raised the cost for Americans. Consumers paid the
Speaker 3: cost of those tariffs, according to almost every study that
Speaker 3: has been done, and it also brought down the number
Speaker 3: of jobs, not raised the number of jobs, it held
Speaker 3: the number of jobs created down and slowed growth a bit.
Speaker 3: Tariffs in general, just broadly applied, do not have a
Speaker 3: positive effect on the economy, and that's pretty much according
Speaker 3: to every economic study that's been done.
Speaker 4: I do wonder to what extent, And look, again, these
Speaker 4: aren't policy. We're going by true social we're going by
Speaker 4: posts from the incoming president. But no question that if
Speaker 4: you're an executive at one of these companies that could
Speaker 4: be affected by tariffs, you're certainly thinking about your supply
Speaker 4: chain today differently than maybe you were thinking about it
Speaker 4: just a few weeks ago. Mike, I do wonder about
Speaker 4: the economic effects of something like this, and whether or
Speaker 4: not it could be looked at as Okay, maybe this
Speaker 4: is just a bargaining tool. Maybe this is being used
Speaker 4: to threaten but actually be used as leverage, as some
Speaker 4: have suggested.
Speaker 3: Yeah, the question I have that I would pose to
Speaker 3: people who make that argument is what are they negotiating.
Speaker 3: Canada and Mexico basically have free trade agreements with the
Speaker 3: United States. There aren't any tariffs on most products. So
Speaker 3: what is it you're looking for? Are you trying to
Speaker 3: get the Mexicans to stop people at the border? Well,
Speaker 3: that's sort of already happening under Biden. Now, since last June,
Speaker 3: the amount of fentanyl coming into the country has dropped
Speaker 3: a lot, and China has pulled back on the amount
Speaker 3: of fentanyl it's letting go through its borders to the US.
Speaker 3: So there has been progress on these things that you
Speaker 3: could say would continue. So what is it exactly that's
Speaker 3: being negotiated. That's the problem for companies is they don't
Speaker 3: know are they actually going to throw these tariffs on
Speaker 3: on day one, as as Donald Trump's truth Social said,
Speaker 3: or are these things going to be something that is
Speaker 3: for negotiation and are spread out over a period of time,
Speaker 3: in which case maybe you can adjust your supply chains
Speaker 3: a little bit. For a lot of companies brought their
Speaker 3: supply chains back to this side of the Atlantic and
Speaker 3: Pacific and put them in Mexico, And so if you're
Speaker 3: going to tariff Mexican stuff, then that's going to be
Speaker 3: a problem as well. So there's a lot of uncertainty
Speaker 3: out there for corporate leaders, all right, And.
Speaker 2: I just want to point out, as we're going to
Speaker 2: get into the next segment, you'll see who is our
Speaker 2: top of course, Mexico is our top trading partner. With
Speaker 2: the United States. So we're going to talk a little
Speaker 2: bit more into that, and that is ahead of China. Hey, Mike,
Speaker 2: thank you as always. Michael McKee, International Economics and Policy
Speaker 2: correspondent right out there outside the Federal Reserve in Washington.
Speaker 2: Do you want to point out that trader's reaction to
Speaker 2: those FOMC minutes have been a bit muted to your
Speaker 2: yields slid slightly more than one basis point barely registers
Speaker 2: right in the context of some big moves earlier in
Speaker 2: the session. So for future yields are a little change from
Speaker 2: before the minutes came out. They show policymakers are cautious
Speaker 2: about future rate cuts. The messaging from Fed officials earlier
Speaker 2: in the month that the December cut was in doubt
Speaker 2: seems to have done its job. So a little bit
Speaker 2: of a weighing in by our team here on our
Speaker 2: Markets Live blog.
Speaker 4: Okay, so let's stay with US trade and tariff talk.
Speaker 4: As we just mentioned with Mike, Donald Trump posted to
Speaker 4: his True social network vowing again to impose additional ten
Speaker 4: percent tariffs on goods from China and twenty five percent
Speaker 4: tariffs on all products from Mexico and Canada. Assuming president
Speaker 4: like Trump implements these policies in January, it could raise
Speaker 4: prices on everyday goods, including TVs and cars. But it's
Speaker 4: also a sign he's making good on a signature campaign
Speaker 4: promise tariffs, tariff.
Speaker 3: Tariff, tariff.
Speaker 4: I am a tariff man.
Speaker 5: To me, the most beautiful word in the dictionary is tariff.
Speaker 6: Build your plant in the United States, and you don't
Speaker 6: have any tariffs?
Speaker 2: All right? That, of course was Donald Trump before the
Speaker 2: US vote. Let's get more. Let's talk about what's going
Speaker 2: on a little bit more on terms of his proposals.
Speaker 2: Joining us is Henrietta Tres, co founder and director of
Speaker 2: Economic Policy and Vita Partners joining us from Jacksonville, Florida. Henrietta,
Speaker 2: is so great to have you here. Love listening to
Speaker 2: you when you join the surveillance team. Tell us about
Speaker 2: these proposals, your take and what the implications could be
Speaker 2: for us, the trade picture for our economy. What are
Speaker 2: your initial thoughts?
Speaker 7: Initial thoughts are you know we should be taking these
Speaker 7: tarfts very seriously, especially the China tariffs. I think they
Speaker 7: sound a little less worse, a little less bad than
Speaker 7: they ultimately will be. I mean, let's recall that there
Speaker 7: is three hundred and fifty billion dollars worth of goods
Speaker 7: coming in from China right now that already have twenty
Speaker 7: five percent and seven and a half percent tariffs. When
Speaker 7: he says that he wants to increase the tariff by
Speaker 7: ten percentage points, that means the twenty five percent rate
Speaker 7: goes to thirty five percent across Lists one and two,
Speaker 7: which is fifty billion dollars worth of industrial inputs. And
Speaker 7: then on List three, which is two hundred billion dollars
Speaker 7: or more than that on a lot of things that
Speaker 7: we buy at at the grocery, at big box retail stores,
Speaker 7: lot screen TVs, things like that. Those tariffs are already
Speaker 7: on at twenty five percent, so this would hike it
Speaker 7: further to thirty five percent with China. The biggest unknown,
Speaker 7: and I think the biggest fear for investors and the
Speaker 7: FED and consumers is List four B. This is about
Speaker 7: one hundred and eighty billion dollars worth of everything that
Speaker 7: you buy at the grocery store, from a scented candle
Speaker 7: to a milk product, the powdered milk, things along those lines,
Speaker 7: and those have never been tariff before, largely because they're
Speaker 7: so regressive and consumer facing, and those would start off
Speaker 7: under President Trump's tweet at ten percent next year.
Speaker 4: Okay, well, Henriette, I want to bring in some upbreaking news.
Speaker 4: The President electors points to name Kevin Hassett to lead
Speaker 4: National Economic Council. It's a role spearheading the new administration's
Speaker 4: tax trait and spending agenda. Bloomberg News reporting this according
Speaker 4: to people familiar with the matter. Remember, he also backs
Speaker 4: the Republican slate of tariff proposals. He was the chair
Speaker 4: of the Council of Economic Advisors during President Trump's first administration,
Speaker 4: So anyone who paid attention from twenty sixteen to twenty
Speaker 4: twenty is familiar with Kevin Hasset. The appointment will not
Speaker 4: become final until it's announced by Trump. What are your
Speaker 4: thoughts on this? What do we know from his role
Speaker 4: in twenty sixteen and during Trump's first term, how he
Speaker 4: could implement tariffs this time around, or what it means
Speaker 4: for economic policy?
Speaker 2: And we know he backs the Republican slate of tariff proposals,
Speaker 2: so he seems to be all in on this.
Speaker 8: Yeah.
Speaker 9: Absolutely, Kevin Hasten its definitely in on this.
Speaker 7: I would say this is very Maggie universe, tariff universe,
Speaker 7: strong policy announcement or personnel announcement. When I think of
Speaker 7: NEC director going into next year, the first thing I
Speaker 7: think of is this is the kind of person who
Speaker 7: would encourage the House and Senate Republicans to include tariff's
Speaker 7: in their tax bill, and that is something that I
Speaker 7: think is a real long shot. All the farming state
Speaker 7: senators have a real problem with this, along with specific
Speaker 7: members from individual states who don't like tariffs as a
Speaker 7: general US policy. But this suggests to me that he'll
Speaker 7: be working most closely with lawmakers, especially on the House side,
Speaker 7: which is a more generous bunch to the Trump administration
Speaker 7: the Trump agenda than the Senate Republican conference. So look
Speaker 7: for Kevin Hasset to be somebody who coordinates more than
Speaker 7: say Alutnik or Besent on actually writing the tax bill
Speaker 7: next year, and then obviously having a cadre of control
Speaker 7: over tariff policy outside of Congress, within the White House
Speaker 7: executive orders things along those lines. That is a very
Speaker 7: strategic placement. I think he will be integral into the tariffrole.
Speaker 7: I think the most important person to wait for is
Speaker 7: still Bob Leitheiser, but this is an indication that the
Speaker 7: tariffs are very real.
Speaker 2: Hey, listen, Henriette. What I'm wondering is we start to
Speaker 2: get ideas of what, especially the Trump team when it
Speaker 2: comes to economic policy, trade policy, what it looks like,
Speaker 2: are we increasingly building an isolationist policy for the United
Speaker 2: States and anti growth policy, which was kind of the
Speaker 2: antithesis when he got elected because I think everybody thought
Speaker 2: he's in regulation, great for the business environment, you know,
Speaker 2: pro growth policy. How are you gaming that out?
Speaker 9: Yeah?
Speaker 7: I don't see any of that in a whole bunch
Speaker 7: of different avenues. And I would start with, you know,
Speaker 7: they talk about deregulation spurring exhaustive economic growth. And then
Speaker 7: they also talk about trimming two trillion dollars or three
Speaker 7: percent of federal spending to generate budget savings and otherwise
Speaker 7: reduce the deficit. That's definitely not going to happen when
Speaker 7: you need sixty votes in the United States Senate. And
Speaker 7: then you also have this idea of a tax bill
Speaker 7: that is four point six trillion dollars just to keep
Speaker 7: things static. That's not including new tax rate reductions for
Speaker 7: either corporations or individuals. And then you layer on the
Speaker 7: inflationary tariffs of twenty five percent on Canada and Mexico,
Speaker 7: our biggest trading partners, as you point out, and then
Speaker 7: ten percent across the board, already high tariffs against China,
Speaker 7: and we haven't even heard about his policy on the
Speaker 7: EU yet, which I think could result in auto tariffs
Speaker 7: as early as March thirty first, when the Section two
Speaker 7: thirty two tariffs suspension expires.
Speaker 4: I'm glad you go ahead. There's just a lot there,
Speaker 4: there is, and I'm glad you mentioned the auto tariffs
Speaker 4: because that's exactly where I want to go. But also
Speaker 4: there the broader market reaction, Henrietta, I got to tell you,
Speaker 4: I'm a little surprised by the equity market reaction to
Speaker 4: this news last night. I expected to log in and
Speaker 4: see that stocks were down today as a result of this. Yes,
Speaker 4: you have GM and Ford lower as a result of
Speaker 4: her concerns of those companies being hit by auto tariffs.
Speaker 4: Why do you think there is a muted reaction in
Speaker 4: the equity market today.
Speaker 7: I think Mike Wakkeith said it exactly correct before. I mean,
Speaker 7: there's a misunderstanding, I think between what has happened and
Speaker 7: what people expect from Trump. They see this as posturing
Speaker 7: and not serious. But point me to a tariff that
Speaker 7: he has not actually imposed. Point me to a tariff
Speaker 7: that hasn't been on for months, if not years. And
Speaker 7: in the case of China's seven years worth of these tariffs,
Speaker 7: they are very real. They are not only real, they
Speaker 7: are a mandatory component of his economic agenda. When you
Speaker 7: try to pass a five trillion dollar tax bill and
Speaker 7: say that you're going to get a trillion dollars in
Speaker 7: revenue from tariffs, you must impose those tariffs to generate
Speaker 7: the revenue. So I think there's wilful disbelief.
Speaker 4: Well, wilful disbelief, or do you think the equity market
Speaker 4: has it wrong today and that he will follow through
Speaker 4: with tariffs such as these because that's what his past
Speaker 4: behavior has shown.
Speaker 7: I think that they the market should be pricing in
Speaker 7: that these tariffs are very real. I'd layer on just
Speaker 7: a little bit further. I don't think that this is
Speaker 7: going to be the case with Canada and Mexico, but
Speaker 7: be mindful that it's not just a one time hit.
Speaker 7: When you're building an automobile, you cross the US Mexico
Speaker 7: and Canada border multiple times just for the same vehicle.
Speaker 7: So is that twenty five percent tariff on just one
Speaker 7: time or is it on every single time it crosses
Speaker 7: between the borders, because that could be a five times event.
Speaker 2: Hey, twenty seconds. Is this gonna be a problem for
Speaker 2: the US economy?
Speaker 7: Absolutely, especially if LIS four B goes into effect. It's
Speaker 7: a huge problem and very disruptive on the Canada and
Speaker 7: Mexico front, which are our largest trading partners.
Speaker 2: All right, great stuff, Oh my god, wish we had
Speaker 2: more time. Please come back soon. Henrietta Tres, co founder
Speaker 2: and director of economic Policy at the investment advisor and
Speaker 2: consultantly firm Veda Partners. Joining us here on this Tuesday.
Speaker 1: You're listening to the Bloomberg Business podcast. Catch us Live
Speaker 1: weekday afternoons from two to five pm Eastern Listen on
Speaker 1: Apple car Play and then brought auto with a Bloomberg
Speaker 1: Business app or warn't us live on YouTube.
Speaker 2: All right, cooks, We did get some housing data today,
Speaker 2: Sales of new homes in the United States slumping in
Speaker 2: the month of October to the lowest in almost two years.
Speaker 2: Two hurricanes, of course, hitting the South, and affordability challenges
Speaker 2: continued awigh on buyers. We also got some data tim
Speaker 2: on home price gains.
Speaker 4: Yeah, this is really interesting. New single family home sales
Speaker 4: decrease seventeen percent last month to six hundred and ten
Speaker 4: thousand annualized rate. That's according to government data issued Tuesday.
Speaker 4: Home price gains in the US slowed in September two
Speaker 4: as buyers gained more negotiating power in the housing market.
Speaker 4: That national gage of prices rose three point nine percent
Speaker 4: from a year earlier. That's according to SMP core Logic
Speaker 4: Case Shiller.
Speaker 2: And I'm figuring it plays into supplying to Mamble, Let's
Speaker 2: see what our next guest has to say, Chris, she
Speaker 2: has a front seat when it comes to the housing market.
Speaker 2: Kati Hubbard is executive EP of Capital Markets of the
Speaker 2: privately owned acid and real estate investment firm. They are
Speaker 2: Walton Global. They've got nearly four point four billion dollars
Speaker 2: of land under management, over ninety thousand acres under management
Speaker 2: throughout the United States, and they operate in the retail, industrial,
Speaker 2: and commercial sectors. Katie joining us from Denver. Katie, good
Speaker 2: to have you here with us. How are you and
Speaker 2: how would you characterize the US housing market today?
Speaker 9: Him? Carol Hi, Tim, Thanks for having me. I'm doing well,
Speaker 9: and yes, we definitely see that October had a lot
Speaker 9: of noise in it. As you mentioned, we had two hurricanes.
Speaker 9: Rates mortgage rates grows in October quite a bit, but
Speaker 9: it was a very regional outlook that came out. So
Speaker 9: the South specifically dropped twenty seven percent in sales. Well,
Speaker 9: the Northeast picked up fifty three percent in sales, So
Speaker 9: you just got to look at those regional areas.
Speaker 4: I want to talk a little bit about where you
Speaker 4: are in the ecosystem of real estate, because you guys
Speaker 4: operate in a really interesting space. The idea is you
Speaker 4: buy land and hold on to it until developers who
Speaker 4: want to build homes want to develop that land, and
Speaker 4: then you sell it to them. So certainly, interest rate
Speaker 4: environment is really important to you. How do you feel
Speaker 4: about the rate environment and the rate path moving forward
Speaker 4: and how that's going to affect your business.
Speaker 9: Yeah, so our clients are typically the largest public homebuilders,
Speaker 9: and the rate environment obviously is affecting all of the homeboilders,
Speaker 9: but the large ones that have the scale and the
Speaker 9: ability to buy down rates have been doing just that
Speaker 9: and been gaining market share in a rising rate environment.
Speaker 9: It's been good for the large homebuilders who are who
Speaker 9: are more competitive.
Speaker 4: So it's it's okay, that's what's That's what's hard to
Speaker 4: understand because you know, the idea is when rates go down,
Speaker 4: people can afford to buy more homes. Hopefully, that's the idea.
Speaker 4: We haven't really seen that play out necessarily just because
Speaker 4: of the demand element here. But but how does it
Speaker 4: affect the way that homebuilders then come to you to
Speaker 4: purchase land?
Speaker 9: Yeah, I mean it definitely just because we're typically feeding
Speaker 9: the land to the largest public homebuilders and they're less
Speaker 9: rate sensitive. The smaller builders that that don't have the
Speaker 9: ability to buy down the rates are more effective and
Speaker 9: can't really compete in the land space as well as
Speaker 9: the large builders. We're also purchasing land ahead of needing
Speaker 9: it right now, so they're keeping an off balance sheet
Speaker 9: where smaller builders, who are also affected by the mortgages,
Speaker 9: they don't have the ability to land bank like the
Speaker 9: larger competitors do. But obviously when rates go down, you
Speaker 9: know in that sweet spot when it goes below six percent,
Speaker 9: I mean, there's a lot of people on the sidelines
Speaker 9: right now that are waiting for that, and we think
Speaker 9: that that's going to be coming up into the next year.
Speaker 9: Probably won't be hitting below six percent this year, but
Speaker 9: a next year could get a lot of consumers off
Speaker 9: the sidelines.
Speaker 2: Katie, one thing I'm curious about and I want to
Speaker 2: get your take on this, and we want to get
Speaker 2: into kind of what people want in homes going forward.
Speaker 2: I mean, I don't know if the mega mansion or
Speaker 2: the MC mansions are gone. But before we do that,
Speaker 2: we talk about the housing shortages in the United States.
Speaker 2: It's not just a one or two or three year thing.
Speaker 2: It's at least ten years, if not more. And that
Speaker 2: you don't have affordable housing in great cities, be it
Speaker 2: New York or elsewhere for those people who work in
Speaker 2: this city but can't afford to live there. So it's
Speaker 2: not just about building housing, but building housing, affordable housing
Speaker 2: where it needs to be. So when you guys are
Speaker 2: acquiring land, is it in major cities, is it suburbs,
Speaker 2: like is it really feeding the demand that needs to
Speaker 2: be met?
Speaker 8: Yeah?
Speaker 9: Good question. So it's really it's regionally based, but we
Speaker 9: are typically on the outskirts of the cities where home
Speaker 9: builders can build larger scale communities versus those infill locations
Speaker 9: because we're dealing on a larger scale land land supply.
Speaker 9: But yeah, absolutely, the homebuilders have adjusted the type of
Speaker 9: product mixes that they're building to just for that affordability factor.
Speaker 9: They're building more efficient floor plans. Everything is getting smaller,
Speaker 9: smaller kitchen, smaller garages, smaller storage to build a smaller
Speaker 9: home just to make them more affordable. What's considered doing
Speaker 9: higher density to your point, Carol, so less big bangons
Speaker 9: and more amenities geared towards the people that are able
Speaker 9: to purchase the homes. So you're seeing more pickable courts
Speaker 9: out there.
Speaker 2: It's kind of funny what's considered affordable, Like, what do
Speaker 2: you guys consider affordable housing? And I know as geography
Speaker 2: and I understand that, but give me an idea.
Speaker 9: Yeah, so the average new home is just hitting around
Speaker 9: in the four hundred and sixty seven thousand dollars range,
Speaker 9: and people are moving to the northeast now core affordability.
Speaker 9: I mean you can Youngstown, Ohio. You can get a
Speaker 9: house for one hundred and seventy one thousand dollars. It's
Speaker 9: one of the most affordable markets. And then they're going
Speaker 9: to where their jobs are located. So, for example, Syracuse,
Speaker 9: New York has a huge influx of people because Micron's
Speaker 9: building one hundred billion dollar chip manufacturing plant. So if
Speaker 9: the jobs are there, then you know, it's relative to
Speaker 9: that market. But Southern California, I mean it's still one
Speaker 9: of the most expensive markets and one of the most
Speaker 9: difficult places to build because land is so expensive, So
Speaker 9: it is very relative.
Speaker 4: Like you said, Well, that said, you do have quite
Speaker 4: a few assets in the state of California, quite a
Speaker 4: few in the San Diego area, a few in the
Speaker 4: Bay Area as well. What is attractive to you about
Speaker 4: that area given how expensive it is and how difficult
Speaker 4: it is for some home builders to actually build in California.
Speaker 2: Doesn't scream affordable.
Speaker 9: To me, right, It's just it's the overall fundamentals of
Speaker 9: people wanting to be in southern California. So the demand
Speaker 9: is there and you have a scarcity of land that's
Speaker 9: available for development. You used to have this mentality of
Speaker 9: you know, people didn't want things built in their backyard,
Speaker 9: the Nimbi mentality, Well, in California goes a step further.
Speaker 9: It's now called the banana mentality, which is build absolutely
Speaker 9: nothing anywhere near anything, So.
Speaker 3: It makes it.
Speaker 4: I've never heard that that's the Banana build Absolutely nothing
Speaker 4: anywhere near.
Speaker 9: Anything exactly that, And that is the California It can
Speaker 9: be the California mentality. And so if you have the
Speaker 9: expertise and the boots on the ground to buy the
Speaker 9: land for the builders, the demand for people wanting to
Speaker 9: live there is there.
Speaker 2: Nuts looking at the map of your website in terms
Speaker 2: of where you, guys, I guess have land and land assets,
Speaker 2: specifically Atlanta, is it still on fire for you, guys,
Speaker 2: or is that property land just sitting kind of empty
Speaker 2: and demand is cooled.
Speaker 9: There definitely is demand there, but you are seeing less
Speaker 9: demand in the South. Like I mentioned the October numbers
Speaker 9: for the Southeast, we're down, but I mean it's still
Speaker 9: a good place for migration for the affordability factor.
Speaker 2: Texas too, are people still fly to Texas Texas?
Speaker 9: Texas continues to be a stronghold. Almost all of the
Speaker 9: top public builders have a very large presence in Texas.
Speaker 9: But we're moving to places in the Northeast like Delaware,
Speaker 9: where the public builders have told us they will take
Speaker 9: all of the land that we can bring them. In
Speaker 9: a place like Delaware, because you've got low property taxes,
Speaker 9: no social Security income tax, strong employment, great schools, and
Speaker 9: the surrounding cities are just much more expensive.
Speaker 4: You basically, in thirty seconds, just tell us you basically
Speaker 4: have no assets in the sort of northwest quadrant of
Speaker 4: the United States, I mean all the way from Iowa
Speaker 4: to Washington and Oregon. Why is that.
Speaker 9: We're going to be expanding our acquisition strategy. So we're
Speaker 9: going to be entering the Idaho market. We do land
Speaker 9: bank for t R. Horton in the Northwest, so we
Speaker 9: do have some assets holding land off balance sheet for them.
Speaker 9: So those are markets that we're exploring.
Speaker 2: Where's the most expensive place to buy land right now?
Speaker 9: Just ten seconds, Southern California, I mean California markets are
Speaker 9: the most expensive and the most difficulty.
Speaker 4: That sun is going to develop perfect weather is going
Speaker 4: to cost.
Speaker 2: You, Carol Master, of course it does, Katie Gosh is expensive. Yeah,
Speaker 2: Katie Herbert, thank you so much. SECONDI vice president capital
Speaker 2: markets at the privately owned asset and real estate investment
Speaker 2: company Walton Global.
Speaker 1: You're listening to the Bloomberg Business Week podcast. Listen live
Speaker 1: each weekday starting at two pm Eastern on Apple car
Speaker 1: Play and Android Auto with the Bloomberg Business App. You
Speaker 1: can also listen live on Amazon Alexa from our flagship
Speaker 1: New York station. Just say Alexa play Bloomberg eleven thirty.
Speaker 4: We are just a few days away from Thanksgiving. It
Speaker 4: also means Black Friday, which I think for a lot
Speaker 4: of people it's a lot of shopping. I don't know
Speaker 4: about you. I'm going to be here working. Are you
Speaker 4: going to be shopping?
Speaker 2: I don't know. I don't like I don't like crowds,
Speaker 2: like I like.
Speaker 4: This is interesting. You live in New York City and
Speaker 4: you take the subway every day, and it's very interesting here.
Speaker 3: That is very true.
Speaker 2: Point well taken. But when I can avoid, I have
Speaker 2: to get to work.
Speaker 4: To be honest, I don't like crowds either, and I
Speaker 4: can't avoid the same place.
Speaker 2: Just like. No, no, no, no, no.
Speaker 4: Hey, I got some numbers for you. Deloyd out with
Speaker 4: some numbers ahead of the day, saying that the people
Speaker 4: it's surveyed are expected to spend six hundred and fifty dollars.
Speaker 4: That's between Black Friday and Cyber Monday this year. It's
Speaker 4: up fifteen percent over last year. It's also a new record.
Speaker 2: That's a lot of spending. Also of note in that
Speaker 2: survey is that for the first time, online only retailers
Speaker 2: beat out all other retail formats as the preferred way
Speaker 2: consumers want to shop. I mean, go figure.
Speaker 4: Okay, Well, for more on how retailers are thinking about
Speaker 4: the season this year, we go to Tom McGee, president
Speaker 4: and CEO at ICSC. It's the trade group that represents
Speaker 4: the global retail real estate industry, think brick and mortar
Speaker 4: and more. He joins us once again from New York time.
Speaker 5: How are you great? To be with you guys, Thanksgiving?
Speaker 4: Good to be with you.
Speaker 1: Hey.
Speaker 4: You Actually, it's interesting because you spend a lot of
Speaker 4: time at Deloitte, so you're familiar with this survey, I imagine,
Speaker 4: But I'm curious about your your thoughts on the online
Speaker 4: only portion of this that Carol just mentioned the idea
Speaker 4: that for the first time ever, online only retailers feed
Speaker 4: out all other retail formats is the preferred way consumers
Speaker 4: want to shop. You're on the brick and mortar side.
Speaker 4: How do you look at this?
Speaker 10: Well, you know, I look at retail more from an
Speaker 10: omni channel perspective. I know that a lot of folks
Speaker 10: continue to break out retail between online and physical retail.
Speaker 10: But really retailers are somewhat agnostic in regards to where
Speaker 10: the transaction is consummated. You know, they know they have
Speaker 10: to deliver it from their customers, whether that's in the
Speaker 10: online channel or the physical channel. And I think really
Speaker 10: the only channel manners with the consumer channel, and a
Speaker 10: lot of the online you know, a lot of online
Speaker 10: sales are fulfilled out of stores now. Stores are increasingly
Speaker 10: coming many fulfillment centers, so not used just for traditional shopping,
Speaker 10: but really ship from store or curbside pickup or click
Speaker 10: and collect, all those things that are initiated from an
Speaker 10: online perspective but are actually fulfilled from the store. So
Speaker 10: I don't look at online, you know, the growth in
Speaker 10: online sales as a negative for physical retail. I think
Speaker 10: it just complements it. I mean, right quite frankly, the
Speaker 10: challenge right now for physical retail, you know, holistically across
Speaker 10: the country is the demand for physical space is in
Speaker 10: excess of the supply of available physical space that's out there.
Speaker 2: So where are we in the story the demise of
Speaker 2: the mall, be it strip mall, big malls, medium, I
Speaker 2: don't know, you know, where are we on that as
Speaker 2: we do see some retail brands go to the wayside,
Speaker 2: and we do see kind of a filtering out. But
Speaker 2: where are we in that narrative, that story, that reality.
Speaker 10: Time Well, you know, the you know, the the narrative
Speaker 10: of the demise of the mall has been around for
Speaker 10: a long time, for decades at this point, but here
Speaker 10: we are and the mall is still alive and kicking.
Speaker 10: I think when you think of physical retail, you have
Speaker 10: to think of it in multiple dimensions. So there is
Speaker 10: you know, kind of grocery anchored neighborhood centers. There's you know,
Speaker 10: traditional kind of power centers, which are the target Costco
Speaker 10: Walmart anchored centers. And then there's big malls, which can
Speaker 10: range from smaller malls to big regional malls. And you know,
Speaker 10: it's the discussion around large regional malls is more nuanced.
Speaker 10: Some are doing exceptionally well, some are more challenged. The
Speaker 10: story around kind of the target Walmart anchored power centers
Speaker 10: and grocery anchored neighborhood centers is one of exceptional strength.
Speaker 5: Right now. The suburban retail.
Speaker 10: Is kind of on fire, and that's where you're really
Speaker 10: seeing this demand for space exceed the supply of space.
Speaker 10: So it depends upon which sector you're talking about, but
Speaker 10: generally speaking, you know the mall.
Speaker 5: Malls have evolved.
Speaker 10: And they've become much more than just just a place
Speaker 10: for people to shop through, a place for people to
Speaker 10: experience a whole host of different offerings, including dining and
Speaker 10: et cetera. As a matter of fact, I was at
Speaker 10: the mall last night watching Wicket and What to Eat
Speaker 10: right afterwards.
Speaker 4: So you're in New York, so just give us. I
Speaker 4: don't want to you know, I'm not going to dox
Speaker 4: you or anything, but where were you?
Speaker 10: Because I was, I won't to give you the mall
Speaker 10: a specific mall, but I was in New Jersey, Okay,
Speaker 10: which is and.
Speaker 5: That's my point.
Speaker 10: To some extent, I do spend a lot of time
Speaker 10: here in Manhattan, split time between Manhattan and New Jersey,
Speaker 10: and Manhattan is its own ecosystem, and so it's important
Speaker 10: to remember that what we see in Manhattan isn't necessarily
Speaker 10: what you know exists and throughout the rest of the
Speaker 10: United States, particularly in suburban areas.
Speaker 4: Yes, that's what I wanted to talk about in these
Speaker 4: areas of growth here. You mentioned dining and You've mentioned
Speaker 4: that quite a few times when you've been on with
Speaker 4: us in the past. Is that the area of growth
Speaker 4: in these shopping centers or these sort of retail areas.
Speaker 4: You have that big anchor store, the Costcos, the Walmarts,
Speaker 4: but is it restaurants, is it dining. That's really the
Speaker 4: growth area.
Speaker 10: Well, not necessarily an open air retail, you know, which
Speaker 10: is what you just mentioned, so you know, kind of
Speaker 10: grocery anchored or Costco Walmart anchored. Those many of those
Speaker 10: retailers are doing exceptionally well because they're close to where
Speaker 10: people live and in a you know, in a post COVID,
Speaker 10: post pandemic environment, people are obviously working from home a
Speaker 10: lot more, so they have more time to shop and
Speaker 10: quite frankly, the benefit of having that physical retail space
Speaker 10: close to where people are living I was proven out
Speaker 10: during the pandemic. So that's one of the reasons why
Speaker 10: the demand for space is so high, Because these retailers
Speaker 10: want to be close to where people live because it's
Speaker 10: a chance for them to yes have people come to
Speaker 10: the store to shop, but also to the fill online orders.
Speaker 10: It's much cheaper and more efficient for them to either
Speaker 10: ship from those local stores or have the consumer come
Speaker 10: to those in the larger regional malls. Clearly, the mix
Speaker 10: of the curation of what's in that mall is lean
Speaker 10: more heavily towards experiential than product based retail over the
Speaker 10: course of the last ten to fifteen years, because they're
Speaker 10: trying to offer a collection of offerings in those regional malls,
Speaker 10: because they draw from a greater a larger geographic area.
Speaker 2: Hey, Tom, you know what's interesting in the mall and
Speaker 2: retail shopping space. I'm just thinking about the Bloomberg audience.
Speaker 2: We talk about retail and consumer and of course we're
Speaker 2: getting ready for you know, the holiday shopping season. But
Speaker 2: what's interesting from your perspective and you think would be
Speaker 2: interesting to our audience and investing audience who are trying
Speaker 2: to kind of catch trends that might be going away
Speaker 2: or coming around.
Speaker 10: Well, you know, the biggest trend I would tell you
Speaker 10: is the one I started with, which is the demand
Speaker 10: for space is an access to supply of space. And
Speaker 10: a lot of people are surprised by that. But if
Speaker 10: you think about just the numbers the you know, basically
Speaker 10: since the Great Financial Crisis. I'm oversimplifying this, but retail
Speaker 10: sales have almost doubled.
Speaker 5: During that period of time.
Speaker 10: GDP has grown by you know, close to forty percent.
Speaker 10: Physical retail square footage in the US has grown by
Speaker 10: about six percent during that period of time. So while
Speaker 10: retail sales have almost doubled, you haven't really had any
Speaker 10: increase in physical retail space. Now, in some areas you have,
Speaker 10: you know, in some areas of population growth, you might
Speaker 10: have had some additional square footage added in the Texas
Speaker 10: is and the Floridas of the world. But generally speaking,
Speaker 10: in most densely populated areas, it's either remained flat or
Speaker 10: the amount of space has actually decreased during that period
Speaker 10: of time. And retailers want more physical space. I mean
Speaker 10: they most retailers actually want to open up more stores
Speaker 10: right now because of that last mile fulfillment they have discovered. Well,
Speaker 10: we talk a lot of media and a lot of
Speaker 10: investors still talk about online versus physical. Retailers really think
Speaker 10: about it from an omni channel perspective, and they look
Speaker 10: at the store as an asset that they can utilize
Speaker 10: the multiple dimensions not only for traditional shopping, but particularly
Speaker 10: for fulfilling those online orders, and in fact online sales
Speaker 10: grow in areas where retailers open up stores, it grows
Speaker 10: not only the physical retail sales, but online sales as well.
Speaker 2: Totally get it. I mean I do that when I
Speaker 2: sometimes we'll look for a retailer. I can easily, you know,
Speaker 2: pick up drop at a retail store in the city.
Speaker 4: I say, there's the opis by online pickup in store.
Speaker 2: Right exactly. There's some stores I think just outside our building,
Speaker 2: there's some openings for retail space. Oh, they're still there
Speaker 2: and they've been sitting there for a long time.
Speaker 4: All right, come come join us here.
Speaker 2: Thank you, Tommy Gee, thank you so much. At I
Speaker 2: see sc joining us right here on Bloomberg BusinessWeek.
Speaker 1: You're listening to the Bloomberg Business Week podcast. Catch us
Speaker 1: live weekday afternoons from two to five pm Eastern Listen
Speaker 1: on Apple car Play and then brout Auto with a
Speaker 1: Bloomberg Business app. I want us live on YouTube.
Speaker 4: Well, it is time now for Bloomberg Plugged In. It's
Speaker 4: your weekly look at EV's.
Speaker 2: All right, so lots of news already this week. It's
Speaker 2: only Tuesday. Tesla shares were down yesterday. They fell nearly
Speaker 2: four percent in the Monday trade after Bloomberg reported that
Speaker 2: the company's evs would be shut out from consumer rebates
Speaker 2: under proposal by California Governor Gavin Newsom, hitting the prospect
Speaker 2: prospective Democratic presidential hopeful against Republican power player Elon Muski.
Speaker 4: Hell I was not happy about that.
Speaker 2: A little bit of a battle. Well, listen, it used
Speaker 2: to be his home state, right he was did?
Speaker 4: He pointed out that he said this on X. I
Speaker 4: don't know if I haven't fact checked it, but he
Speaker 4: said that Tesla is the only one that makes EV's
Speaker 4: in California so interesting.
Speaker 2: So we're a little bit of a battle here. So
Speaker 2: we have a great guest to get into this.
Speaker 4: We do. We got Andy Bennett with us. He's CEO
Speaker 4: of Drives. It's a company that provides EV charging management software.
Speaker 4: It's part of the five point eight billion dollar market
Speaker 4: cap publicly held Volunteer Corporation. Andy joins us from Beautiful Boulder, Colorado. Andy,
Speaker 4: how are you right?
Speaker 8: Yeah? Thanks guys, nice to meet you. Cout Tim, Good
Speaker 8: to have you with us.
Speaker 4: Hey, explain exactly what battery management software does? I mean,
Speaker 4: I think we all understand that you can't just charge
Speaker 4: your iPhone over and over again and expect the battery
Speaker 4: to last the same as it did on the first
Speaker 4: day four years later. Where does the software come into that.
Speaker 6: Yeah, So, in general, we think about batteries in two ways.
Speaker 9: Right.
Speaker 6: Of course, it's the batteries that are in the car, right,
Speaker 6: so you have a battery management system that optimizes the
Speaker 6: use of that energy. But batteries are becoming more and
Speaker 6: more important for EV charging. In places like the United States,
Speaker 6: you have lots and lots of areas that you know,
Speaker 6: effectively are constrained from an energy perspective, and so you
Speaker 6: can put large batteries in those areas. You can control
Speaker 6: the flow of energy, so you can increase the number
Speaker 6: of cars you can charge. So batteries, when you're thinking
Speaker 6: about EV charging, there's really two parts of the equation,
Speaker 6: and the first is that battery in the car, how
Speaker 6: it's behaving, how it's being utilized. And then those batteries
Speaker 6: that are going to yat gas stations all around the country.
Speaker 6: They're going to give us extra capacity to really keep
Speaker 6: that charging experience as quick as possible.
Speaker 2: So, okay, so I'm just curious about you know, it's interesting.
Speaker 2: I'm listening to you talking, I'm thinking about when we
Speaker 2: talk about the ev world, Andy, a lot of what
Speaker 2: comes up is about range anxiety or people being able
Speaker 2: to find a place to recharge. You know, if I
Speaker 2: pop on a highway out to Connecticut, I see them
Speaker 2: the rest stops, they all have them, But in New
Speaker 2: York City it's still really challenging. So I understand what
Speaker 2: you guys are doing, but I feel like, is this
Speaker 2: the cart before the horse in terms of having enough
Speaker 2: places just where people can charge before we kind of
Speaker 2: take it to the optimization level, which sounds like what
Speaker 2: you guys are doing.
Speaker 8: Yeah, No, we do a little bit of both.
Speaker 6: So we build the software behind the world's largest charge
Speaker 6: point operators, so we call them CPOs. So think about
Speaker 6: evy goo as a great example or shell and that
Speaker 6: software is looking at or the health of all those
Speaker 6: chargers out there. Is the network working, is it running?
Speaker 6: Energy is just one part of that total equation. Are
Speaker 6: you able to bill? Are you able to show up
Speaker 6: to a charger? And actually you know, use your credit
Speaker 6: card to go make that work? So without that, without
Speaker 6: that fundamental software, there is no charging. Right, It's the
Speaker 6: it's the infrastructure software that makes it work. But you're
Speaker 6: absolutely right, when you think about the frustration that folks
Speaker 6: have today, it kind of comes in two sort of flavors.
Speaker 6: The first is, when I get to a charger, is
Speaker 6: it available right? And then if it's available, is everything working?
Speaker 6: And as we've seen in over the last couple of years,
Speaker 6: reliability is going up and up and up and up, which.
Speaker 8: Is great, but then you're you nailed it.
Speaker 6: The second part is we just don't have enough charging
Speaker 6: today and place enough public charging. So if you think
Speaker 6: about the United States, you know today we have roughly,
Speaker 6: let's say, about two hundred thousand available chargers to people.
Speaker 8: Most of those are what we.
Speaker 6: Call AC charge, so they're lots slower than the DC
Speaker 6: fast chargers that you might see on the highway. And
Speaker 6: if we were to keep up with really just the
Speaker 6: current sales that we have in evs right now, by
Speaker 6: the end of next year, we would still need to
Speaker 6: build four times more charging infrastructure in the United States
Speaker 6: to meet that demand. Some of those projections say by
Speaker 6: twenty twenty seven twenty twenty eight, we would need to
Speaker 6: build eight times more than what we currently have just
Speaker 6: to satisfy that what you.
Speaker 8: Just mentioned, of course, which is range anxiety.
Speaker 2: So a Trump administration, Are we going to then ramp
Speaker 2: up the building of these because it does sound like
Speaker 2: we need them. Like, what are your expectations around policies
Speaker 2: in the EV world and what it means for the
Speaker 2: industry and your business.
Speaker 6: Yeah, I mean, look, clearly there's some headwinds with some
Speaker 6: of the administrative changes. Some of the things that could
Speaker 6: be changed is you know, we could get a drop
Speaker 6: in passenger EV adoption, right, so if we don't have
Speaker 6: you know, the incentives, then some folks just aren't going
Speaker 6: to go buy those cars. Now, having said that, for
Speaker 6: a company like ourselves that is building the software for
Speaker 6: the charge point operators, there's still such a huge gap
Speaker 6: between having enough of those chargers out there to deal
Speaker 6: with the current requirements, you know, versus what's actually there
Speaker 6: that we kind of some of us in the industry
Speaker 6: are happy to kind of get a little bit of
Speaker 6: a catch up time there.
Speaker 8: So no doubt I think if you think about, you know.
Speaker 6: Right now, where are we in terms of charging infrastructure
Speaker 6: growth for the year. Most of the projections at the
Speaker 6: beginning of the year said, look, we'll probably end up
Speaker 6: at around thirty percent year of a year growth in
Speaker 6: public charging. We actually know it's it's probably closer to
Speaker 6: thirty six or thirty eight percent growth. It's just an
Speaker 6: incredible cater I think about that, that's a massive amount
Speaker 6: of infrastructure that big CPOs are building as quickly as
Speaker 6: they can, and I think often we spend a little
Speaker 6: bit too much time maybe associating that build out with
Speaker 6: the NEVY funding, the federal funding that came out. Most
Speaker 6: of that infrastructure spending happened way before the federal government
Speaker 6: ever started to step in and incentivize. So, look, we
Speaker 6: still have a ton of demand. The big CPOs are
Speaker 6: still building at just breakneck speed.
Speaker 8: That's going to happen.
Speaker 6: It may it may get a little bit compressed, of course,
Speaker 6: but it's still going to happen at a very very
Speaker 6: fast rate independent of the whole NEVY funding pathway.
Speaker 4: I'm wondering about just the basic question, Andy, if we
Speaker 4: think about where all the gas stations are in this country,
Speaker 4: why is it cost prohibitive for these gas station owners
Speaker 4: to just add one or two EV charging systems to
Speaker 4: their existing gas stations? Like why doesn't why why is
Speaker 4: this so difficult to do?
Speaker 6: Yeah, I got you know, Tim, that's a that's a
Speaker 6: really great question. You know, for me, I kind of
Speaker 6: to look for that answer. One of the best places
Speaker 6: to go look is in the Nordics, right where we
Speaker 6: know today over.
Speaker 8: Ninety percent of all new cars or evs.
Speaker 6: Look at the UK, look at Europe, which is, by
Speaker 6: the way, one of the places my company has been
Speaker 6: for years helping charge point operators.
Speaker 8: You know, what you see as some gas.
Speaker 6: Stations are really well suited for electrification and some some aren't.
Speaker 6: Maybe a couple quick comments about that, because you know,
Speaker 6: no matter what, we believe that the winners in this
Speaker 6: marketplace are are going to be the fueling stations that
Speaker 6: also have other things, other amenities, other conveniences. So when
Speaker 6: you're in Oslo or outside of Oslo, whether you're in
Speaker 6: the urban area or you're you know, on the highways,
Speaker 6: what you see is EV charging stations that you know,
Speaker 6: have outdoor gyms, they have incredible food, clean bathrooms, really
Speaker 6: nice amenities.
Speaker 8: The second you show up at one of these stations, you.
Speaker 6: Connect to their Wi Fi and you start to get
Speaker 6: coupons to go inside and save ten percent on.
Speaker 8: A cup of coffee. It's a really.
Speaker 6: Really integrated experience, and we certainly see some of the
Speaker 6: larger retailers here in the United States. Starting down that
Speaker 6: pathway Apple Green, you've ever driven on Route ninety five
Speaker 6: is a perfect example as you go through New Jersey,
Speaker 6: extremely innovative around what that experience will look like. But
Speaker 6: having said that, some of those places just aren't great spots, right.
Speaker 8: They may not.
Speaker 6: Have the ability to they might not have just the
Speaker 6: real state to bring that in, they may not have
Speaker 6: the conveniences. And remember the average weight time is probably
Speaker 6: about twenty two minute minutes today as you're charging on
Speaker 6: a a DC fast charger, so you generally want to get.
Speaker 8: Out of the car.
Speaker 6: You're going to expect other amenities. But when you go
Speaker 6: back to the European example, what we do see, especially
Speaker 6: in their urban environments is a slower, more methodical transfer.
Speaker 6: So over time they don't just go one hundred percent electric.
Speaker 6: Those stations they may have you know, ten fueling pumps
Speaker 6: and two DC chargers to start with, and then and
Speaker 6: then they slowly pull out those pumping stations. Circle K
Speaker 6: is a great example in Europe where they have done
Speaker 6: this really fluid transition. As the economics makes sense that
Speaker 6: DC fast charge is expensive, so just the way to
Speaker 6: think about it is break even on that investment, probably
Speaker 6: close to about eleven percent utilization. It has to be
Speaker 6: being used eleven percent of the time that it's there.
Speaker 4: I will say, Carol, my trip to Norway a few
Speaker 4: years ago. The infrastructure just makes you cry when you
Speaker 4: compare it to US infrastructure. The tunnels, the tunnels are incredible.
Speaker 4: Just drill right through these mountains, miles long, totally well lit,
Speaker 4: not crowded at all. Unbelievable.
Speaker 2: Maybe Elon's onto something with the boring company. I'm just saying, Hey,
Speaker 2: just got thirty seconds. Andy in a nutshell or word
Speaker 2: or two, how do you describe the ev mark it today?
Speaker 6: You know, look, we make software behind these charging companies.
Speaker 6: We can barely keep up with the demand. And the
Speaker 6: growth that's taking place has been incredible. We're a company
Speaker 6: that's doubling year over year and just you know, building
Speaker 6: the things these folks need to be successful.
Speaker 8: For us.
Speaker 6: Your huge portion of the market still remains in Europe.
Speaker 6: The United States is just starting to grow. I think
Speaker 6: we're going to see a little bit of a dent
Speaker 6: taken out of passenger EV charging. Nothing is going to
Speaker 6: stop the electrification of large scale fleets though. That is
Speaker 6: picking up at a pace that is really fantastic. And
Speaker 6: why that's relevant is as that continues to be successful,
Speaker 6: we're going to see whether it's a passenger or a
Speaker 6: truck co charging at these different places so the infrastructures
Speaker 6: can continue.
Speaker 8: To roll out.
Speaker 6: At the end of the day, if you build a car, right,
Speaker 6: there's two things you need to go get people buy
Speaker 6: an EV car, cut the cost of the battery, and
Speaker 6: get more EV infrastructure out there.
Speaker 2: Totally makes sense. Andy Bennett really enjoyed the CEO of
Speaker 2: drives jotting us right here on Bloomberg Business.
Speaker 4: That's a d R I v Z.
Speaker 2: Very cool.
Speaker 5: Yeah, I love that, brother, Marca.
Speaker 3: Journal. How about you let me drive?
Speaker 5: Oh no, no, no, no, honey, please, I'll do the gravel.
Speaker 2: Let's wat I want to drive.
Speaker 6: It's a good question.
Speaker 4: This is the drive to the clothes dot com for me.
Speaker 4: I think we'll buy a Roundel Don on Bloomberg Radio,
Speaker 4: it is the drive to the clothes on this Wow,
Speaker 4: how do we get here?
Speaker 2: Carol which one Tuesday, November.
Speaker 4: Twenty six it's almost it's it's it's almost. It's almost
Speaker 4: time for Thanksgiving.
Speaker 2: Oh no, no, let's see what Alan Lance has to say,
Speaker 2: because time flies when you're having fun. Director of research
Speaker 2: at Landsglobal dot com, President of Allan B. Lands and
Speaker 2: Associates with us once again from Toledo, Ohio. Hey, nice
Speaker 2: to have you here forgive the shortens today, but of
Speaker 2: course breaking news. Trump's all other certainly here at Bloomberg
Speaker 2: and rightfully so we are watching though the news out
Speaker 2: of Washington, the geopolitics. What's changed in your view since
Speaker 2: Donald Trump was elected, uh, back into the White House?
Speaker 11: Quite a big carol, obviously, you know, everybody's looking at
Speaker 11: the glass half full. You know, some uh sectors have
Speaker 11: really underperformed, Like you know, the financials because of the
Speaker 11: potential deregulation have really you know, outperformed, and you've seen
Speaker 11: a good broadening out which is very healthy of the
Speaker 11: market where you know, it's not just the magnificent seven,
Speaker 11: you know, or tech you know, uh, communications services, but
Speaker 11: it's a small cap mid cap and uh, you know
Speaker 11: quite a few participants now in this rally, so so
Speaker 11: that that's been healthy and uh, you know it was
Speaker 11: it was fairly predictable. There were a lot of stocks,
Speaker 11: including like software and tech had underperformed that you know,
Speaker 11: there's some key advantages. They're real well positioned for AI.
Speaker 11: And and what's going to happen with the advancement it's
Speaker 11: of AI and you know that that's starting to get
Speaker 11: invest attention and companies like Snowflake and Mango dB or
Speaker 11: starting to move.
Speaker 4: Okay, so let's talk about some of these companies. You mentioned. Snowflake,
Speaker 4: it's one of your picks right now. The company reported
Speaker 4: earnings in recent days. Why are you bullish on Snowflake?
Speaker 11: Yeah, Tim, we recommended it in June. We figured they
Speaker 11: just had a bad quarter. The stock moved down from
Speaker 11: three hundreds to as far as the low hundreds. Actually
Speaker 11: recommended one hundred and twenty four. It went to one
Speaker 11: hundred and seven. So we just kept on buying. We
Speaker 11: knew there's gonna be another quarter or two. And really
Speaker 11: over the past week they reported, you know, better than
Speaker 11: expected results and the stock has moved up. And that's
Speaker 11: happened with quite a few Mango, dB, Data, Dog, et cetera.
Speaker 11: I think industers are starting to see that, you know,
Speaker 11: they can ride the coattails of some of the magnificent.
Speaker 4: Sabbath Okay, and we don't have a ton of time,
Speaker 4: so I want to get to one more forgive me.
Speaker 4: We'll leave thirty seconds. Dell fave report earnings after the
Speaker 4: bell today. Why are you bullsh on Dell?
Speaker 11: Then we like that, we wouldn't chase it, so basically
Speaker 11: we'd have it an old here, but it's one that
Speaker 11: you know when would have broke a hundred, you know,
Speaker 11: just like the video. These these companies are really volatile,
Speaker 11: so by you know when they're out of favor and
Speaker 11: you know, take some profits if you do see a
Speaker 11: spike with the Dell earnings tonight.
Speaker 4: All right, Alan, thanks so much for joining us this afternoon.
Speaker 4: Alan Lance, director of Research over Atlance Global dot com,
Speaker 4: President of Alan B. Lance and Associates, joining us from Toledo, Ohio.
Speaker 1: For This is the Bloomberg Business Week podcast, a Little Apple,
Speaker 1: Spotify and anywhere else you get your podcast. Listen live
Speaker 1: weekday afternoons from two to five pm Eastern on Bloomberg
Speaker 1: dot com, the iHeartRadio app, tune In, and the Bloomberg
Speaker 1: Business App. You can also watch as long I have
Speaker 1: every weekday on YouTube and always on the Bloomberg terminal
Speaker 6: M