1 00:00:04,760 --> 00:00:08,080 Speaker 1: Welcome to the Bloomberg pim L Podcast. I'm pim Fox. 2 00:00:08,119 --> 00:00:11,200 Speaker 1: Along with my co host Lisa Abramowitz. Each day we 3 00:00:11,280 --> 00:00:14,480 Speaker 1: bring you the most important, noteworthy and useful interviews for 4 00:00:14,520 --> 00:00:16,880 Speaker 1: you and your money, whether at the grocery store or 5 00:00:16,920 --> 00:00:20,640 Speaker 1: the trading floor. Find the Bloomberg p L Podcast on iTunes, 6 00:00:20,840 --> 00:00:31,160 Speaker 1: SoundCloud and at Bloomberg dot com. It is St Patrick's 7 00:00:31,240 --> 00:00:34,640 Speaker 1: Day on this Friday, and we are so honored to 8 00:00:34,640 --> 00:00:37,800 Speaker 1: have with us Marian Harkin, who is the European Union 9 00:00:37,880 --> 00:00:41,479 Speaker 1: parliament member representing Ireland. She also earlier served in Ireland's 10 00:00:41,479 --> 00:00:44,479 Speaker 1: Parliament UH and is a member, of course of the 11 00:00:44,560 --> 00:00:48,000 Speaker 1: EU Parliament's Economic and Monetary Affairs Committee. We are so 12 00:00:48,040 --> 00:00:49,600 Speaker 1: glad to have you with us. Mary, Thank you so 13 00:00:49,680 --> 00:00:52,240 Speaker 1: much for joining us. UM. I want to start with 14 00:00:52,520 --> 00:00:56,640 Speaker 1: the Brexit vote and the consequence that a lot of 15 00:00:57,240 --> 00:01:00,760 Speaker 1: UH financial institutions are talking about moving from and into 16 00:01:01,080 --> 00:01:05,039 Speaker 1: some other city that could be potentially give them passporting rights. 17 00:01:05,280 --> 00:01:08,960 Speaker 1: Dublin has emerged as a popular option. What is Dublin 18 00:01:09,040 --> 00:01:13,319 Speaker 1: doing to make sure they are the most popular option? Well, 19 00:01:13,440 --> 00:01:16,920 Speaker 1: the passporting issue is going to be major for the 20 00:01:16,959 --> 00:01:20,319 Speaker 1: city of London, and as you say, we are in 21 00:01:20,400 --> 00:01:24,639 Speaker 1: the market, and already a number of companies have said 22 00:01:24,720 --> 00:01:27,959 Speaker 1: that they're going to base as some of their operations 23 00:01:28,000 --> 00:01:30,360 Speaker 1: from Dublin. We're not getting them all. Some of them 24 00:01:30,360 --> 00:01:32,560 Speaker 1: are going to Luxembourg. And in fact, there was a 25 00:01:32,600 --> 00:01:35,920 Speaker 1: bit of a splash recently between one of the Irish 26 00:01:35,959 --> 00:01:41,200 Speaker 1: ministers and the Luxembourg minister about the regulatory system. But 27 00:01:41,360 --> 00:01:43,399 Speaker 1: AI g right about. It had to do with a 28 00:01:43,480 --> 00:01:46,839 Speaker 1: i G. Insurance company moving their European headquarters to Luxembourg. 29 00:01:46,920 --> 00:01:52,040 Speaker 1: That's it. It's really about supervisory you know, systems. Who 30 00:01:52,120 --> 00:01:56,240 Speaker 1: is going to supervise the regulation and at European level 31 00:01:56,440 --> 00:02:01,000 Speaker 1: that is not harmonized yet, so it's every man, woman 32 00:02:01,200 --> 00:02:04,680 Speaker 1: or country for themselves to some extent. Well, I'm not 33 00:02:04,720 --> 00:02:06,720 Speaker 1: sure that I totally understand there's In other words, it 34 00:02:06,760 --> 00:02:11,400 Speaker 1: means that the different regulatory bodies can offer lighter regulation 35 00:02:11,680 --> 00:02:15,200 Speaker 1: of certain banking institutions if they come to provision. Yeah 36 00:02:15,280 --> 00:02:19,440 Speaker 1: they are, they're not supposed to, but the supervision isn't 37 00:02:19,520 --> 00:02:22,160 Speaker 1: there to the extent that it needs to be to 38 00:02:22,280 --> 00:02:26,280 Speaker 1: make sure that we have harmonized regulatory system. So, in 39 00:02:26,320 --> 00:02:30,720 Speaker 1: other words, as banks are deciding where to move their headquarters, 40 00:02:31,160 --> 00:02:35,440 Speaker 1: uh to remain in this sort of passporting system. That's 41 00:02:35,680 --> 00:02:39,079 Speaker 1: a major consideration. Well it is, it has emerged, and 42 00:02:39,639 --> 00:02:43,680 Speaker 1: the the European body who's in charge of this also 43 00:02:43,720 --> 00:02:47,720 Speaker 1: writes concerns, not just the Irish minister. And it's where 44 00:02:47,760 --> 00:02:50,160 Speaker 1: we're at at the moment. So you know, we're setting 45 00:02:50,200 --> 00:02:52,720 Speaker 1: out our stroll. We've already got a number of companies 46 00:02:52,760 --> 00:02:56,520 Speaker 1: who are coming to Ireland and you know, English speaking 47 00:02:56,800 --> 00:03:00,760 Speaker 1: remain within the EU, etcetera. So's it's going to be 48 00:03:00,800 --> 00:03:04,160 Speaker 1: interesting over the next couple of months. Obviously the British 49 00:03:04,440 --> 00:03:08,240 Speaker 1: want to remain within a single market, but you can't 50 00:03:08,280 --> 00:03:11,720 Speaker 1: do that unless you know you have the four freedoms, 51 00:03:11,760 --> 00:03:14,240 Speaker 1: and they said they don't want it. So which are 52 00:03:14,240 --> 00:03:17,600 Speaker 1: the firms that have already chosen Dublin for their passporting 53 00:03:17,680 --> 00:03:19,360 Speaker 1: rights and which are the biggest firms that are up 54 00:03:19,360 --> 00:03:22,240 Speaker 1: for grabs. While I know Barclays is talking about coming 55 00:03:22,240 --> 00:03:24,280 Speaker 1: to Ireland, I think they have said they will. There 56 00:03:24,280 --> 00:03:27,360 Speaker 1: are a number of other insurance companies. To be perfectly honest, 57 00:03:27,600 --> 00:03:30,200 Speaker 1: I can't remember some of the names right now, but 58 00:03:30,280 --> 00:03:32,880 Speaker 1: I know Barclays is and I think a lot of 59 00:03:32,919 --> 00:03:36,960 Speaker 1: companies are still making final decisions. But I think we 60 00:03:37,040 --> 00:03:40,520 Speaker 1: might be expecting within the next week or two from 61 00:03:40,520 --> 00:03:43,440 Speaker 1: one or two companies. Anyway, I wonder if we could 62 00:03:43,440 --> 00:03:50,440 Speaker 1: just focus on the political uh sort of rumbling, the 63 00:03:50,480 --> 00:03:54,240 Speaker 1: tremors after Brexit and when this article fifty gets triggered, 64 00:03:54,760 --> 00:03:58,800 Speaker 1: because there's this thing it's called Northern Ireland and Scotland 65 00:03:59,400 --> 00:04:01,760 Speaker 1: and they have said they don't want to leave the 66 00:04:01,800 --> 00:04:08,880 Speaker 1: European Union shin Fein, the political party in Ireland, the 67 00:04:08,920 --> 00:04:15,440 Speaker 1: Republic of Ireland, has made no uh allusions that it 68 00:04:15,440 --> 00:04:19,400 Speaker 1: would like to see the Island of Ireland united. Yes, 69 00:04:19,800 --> 00:04:27,040 Speaker 1: will this push that to happen? That's an interesting question 70 00:04:27,160 --> 00:04:31,440 Speaker 1: because there there are still some unknowns. But you're quite right, 71 00:04:31,960 --> 00:04:36,400 Speaker 1: Northern Ireland voted to remain within the EU, as did Scotland. 72 00:04:37,400 --> 00:04:42,039 Speaker 1: We have something called the Good Friday Agreement which guarantees 73 00:04:42,320 --> 00:04:45,320 Speaker 1: if you are born on the island of Ireland that 74 00:04:45,480 --> 00:04:51,200 Speaker 1: you can access Irish citizenship and by extension, EU citizenship. 75 00:04:51,720 --> 00:04:54,840 Speaker 1: And so the Good Friday Agreement is for it's an 76 00:04:54,839 --> 00:04:58,760 Speaker 1: international agreement and it is framed within the context of 77 00:04:58,800 --> 00:05:01,839 Speaker 1: the European Union. And maybe they can do both. Well, 78 00:05:01,920 --> 00:05:04,360 Speaker 1: we have to wait and see. I'm not sure. I 79 00:05:04,400 --> 00:05:06,960 Speaker 1: don't think chin Fain has called for a border pole 80 00:05:07,040 --> 00:05:10,240 Speaker 1: yet though it may um it's hard to know, but 81 00:05:10,279 --> 00:05:13,880 Speaker 1: they've certainly been very successful in the recent elections there. 82 00:05:14,240 --> 00:05:18,080 Speaker 1: But it's there's everything is up for grabs at one 83 00:05:18,200 --> 00:05:21,960 Speaker 1: level and at another level. Really, if you're going to 84 00:05:22,000 --> 00:05:24,760 Speaker 1: look to the United Ireland, in my opinion for what 85 00:05:24,880 --> 00:05:28,960 Speaker 1: it's worth is you've got to um put in place. 86 00:05:29,560 --> 00:05:32,280 Speaker 1: You know, if you like a program or a system 87 00:05:32,320 --> 00:05:35,640 Speaker 1: whereby people want to be part of a United Ireland, 88 00:05:35,839 --> 00:05:39,640 Speaker 1: you cannot drive people against their will. And there is 89 00:05:39,680 --> 00:05:42,640 Speaker 1: no doubt that if we have a hard breakfast that 90 00:05:42,880 --> 00:05:46,240 Speaker 1: to some extent you know, copper fastens the border or 91 00:05:46,360 --> 00:05:50,560 Speaker 1: could and we do not want it under any circumstances. 92 00:05:51,160 --> 00:05:53,840 Speaker 1: May and I want to turn to your role as 93 00:05:53,920 --> 00:05:57,320 Speaker 1: a member of the European Union's Parliament, the Economic Monetary 94 00:05:57,320 --> 00:05:59,719 Speaker 1: Affairs Committee, in particular the Euro. We've been hearing a 95 00:05:59,720 --> 00:06:03,640 Speaker 1: lot about France's populist up surge and sort of the 96 00:06:03,640 --> 00:06:08,600 Speaker 1: potential for their leaving the joint currency, but we've been 97 00:06:08,640 --> 00:06:11,400 Speaker 1: talking recently about Italy and how they're probably a more 98 00:06:11,480 --> 00:06:14,440 Speaker 1: likely candidate to try to ditch the Euro than any others. 99 00:06:14,520 --> 00:06:17,520 Speaker 1: How much discussion do you have in the EU Parliament 100 00:06:17,560 --> 00:06:21,080 Speaker 1: about this, well, I think that discussion is really beginning 101 00:06:21,120 --> 00:06:24,520 Speaker 1: to open up. Now. You talk about Italy, the populist 102 00:06:24,520 --> 00:06:27,120 Speaker 1: movement there as we call them's the Five Star movement, 103 00:06:27,680 --> 00:06:31,800 Speaker 1: and they're talking, you know, about leaving the Euro. So 104 00:06:32,200 --> 00:06:36,400 Speaker 1: I think, you know, countries now that perhaps would never 105 00:06:36,480 --> 00:06:41,360 Speaker 1: have looked at the Euro pluses and minuses are beginning 106 00:06:41,400 --> 00:06:44,720 Speaker 1: to do so. I believe the Netherlands recently commissioned study 107 00:06:44,880 --> 00:06:48,839 Speaker 1: on the Euro and I think while I I see 108 00:06:48,839 --> 00:06:52,440 Speaker 1: the Euro remaining for the next number of years, I 109 00:06:52,480 --> 00:06:56,960 Speaker 1: think the future of the Euro will be determined to 110 00:06:57,000 --> 00:07:02,200 Speaker 1: some extent by what happens the EU. Young recently came 111 00:07:02,279 --> 00:07:05,880 Speaker 1: up with his five options for the EU. In other words, 112 00:07:05,960 --> 00:07:09,680 Speaker 1: do we integrate further? Do we have what do you 113 00:07:09,800 --> 00:07:12,760 Speaker 1: call coalition of the willing where those who want to 114 00:07:12,800 --> 00:07:16,160 Speaker 1: integrate further do so and the rest stand back. Do 115 00:07:16,240 --> 00:07:19,680 Speaker 1: we pair back, give more power back to member states, etcetera. 116 00:07:19,840 --> 00:07:22,440 Speaker 1: There's do we just remain as we are? So there 117 00:07:22,440 --> 00:07:25,120 Speaker 1: are a lot of options there, and I think that 118 00:07:25,160 --> 00:07:29,520 Speaker 1: the political option will determine what happens with the Europe. 119 00:07:30,760 --> 00:07:34,600 Speaker 1: With this particular committee, do you talk about contingency plans? 120 00:07:34,640 --> 00:07:39,080 Speaker 1: If there is a vote to except the joint currency. No, 121 00:07:39,440 --> 00:07:42,800 Speaker 1: that hasn't been raised. But um, you know, we have 122 00:07:42,880 --> 00:07:46,680 Speaker 1: to wait and see. In the Netherlands, the Center help 123 00:07:46,880 --> 00:07:49,960 Speaker 1: we can see that. Will that happen In France it 124 00:07:50,040 --> 00:07:54,240 Speaker 1: seems as if mccron, who's the Centrist candidates now might 125 00:07:54,440 --> 00:07:57,080 Speaker 1: even they say when the first round up to this 126 00:07:57,200 --> 00:08:00,360 Speaker 1: they thought Lepen might, but we haven't way to Oh yes, 127 00:08:00,680 --> 00:08:04,000 Speaker 1: but if if it holds in France, I think that 128 00:08:04,080 --> 00:08:08,800 Speaker 1: means things return to some kind of stability for a while. 129 00:08:09,000 --> 00:08:12,480 Speaker 1: But you mentioned Italy. It's down the line. So it's 130 00:08:12,480 --> 00:08:15,240 Speaker 1: a time of change in Europe, and I think John 131 00:08:15,280 --> 00:08:18,679 Speaker 1: Claude Junker, who's the President of the Commission, is trying 132 00:08:18,720 --> 00:08:24,760 Speaker 1: to shape that change politically before events overtake us. Well, 133 00:08:24,840 --> 00:08:26,960 Speaker 1: we look forward to having you guide us and give 134 00:08:27,040 --> 00:08:29,560 Speaker 1: us information about those events in the future. I want 135 00:08:29,560 --> 00:08:31,800 Speaker 1: to thank you for being with us. Marian Harkin, a 136 00:08:31,880 --> 00:08:50,720 Speaker 1: member of the European Union Parliament's Economic and Monetary Affairs Committee. 137 00:08:52,160 --> 00:08:56,040 Speaker 1: Joe Maisak, Editor Bloomberg Brief, Municipal Markets. You know, I'm 138 00:08:56,080 --> 00:08:58,360 Speaker 1: just I jumped the gun there, Joe, because I'm just 139 00:08:58,440 --> 00:09:00,200 Speaker 1: eager to get through a bunch of things with you. 140 00:09:00,240 --> 00:09:02,560 Speaker 1: I want you to start off by telling us about 141 00:09:02,600 --> 00:09:07,440 Speaker 1: President Donald Trump's budget proposal and what this would mean 142 00:09:07,760 --> 00:09:11,680 Speaker 1: for Amtrak and the Gateway Project. Tell us what it 143 00:09:11,760 --> 00:09:14,600 Speaker 1: is and what could happen. Well, the Gateway Project is 144 00:09:14,880 --> 00:09:19,760 Speaker 1: a big rebuilding of infrastructure in New York and New Jersey, 145 00:09:19,880 --> 00:09:27,120 Speaker 1: will include a new tube under the river. And the 146 00:09:27,160 --> 00:09:30,120 Speaker 1: price tag on this is about billion dollars in the 147 00:09:30,120 --> 00:09:33,760 Speaker 1: states of New York and New Jersey. After several years 148 00:09:33,880 --> 00:09:38,400 Speaker 1: of discussion and argumentation, UH finally decided, yes, this is 149 00:09:38,400 --> 00:09:41,120 Speaker 1: a good thing, will do this. The federal government is 150 00:09:41,160 --> 00:09:45,480 Speaker 1: supposed to provide about half, so you know it's gonna 151 00:09:45,480 --> 00:09:51,079 Speaker 1: be billion, probably more as you know, and the federal 152 00:09:51,080 --> 00:09:55,120 Speaker 1: government tended twelve billion. But now, uh, the people at 153 00:09:55,120 --> 00:09:57,840 Speaker 1: Amtrak are saying, wait a minute, we you know, the 154 00:09:57,960 --> 00:10:02,800 Speaker 1: federal government maybe cutting back in this area. So uh 155 00:10:03,080 --> 00:10:07,600 Speaker 1: they are upset, and uh, you know, obviously they they 156 00:10:07,679 --> 00:10:12,160 Speaker 1: are lobbying heavily to make sure they get the money. 157 00:10:12,200 --> 00:10:15,240 Speaker 1: To put this into context, I believe that the US 158 00:10:15,280 --> 00:10:20,160 Speaker 1: Department of Transportation already provides about what to two point 159 00:10:20,200 --> 00:10:24,400 Speaker 1: three billion dollars each year for the commuter rail and 160 00:10:25,000 --> 00:10:28,120 Speaker 1: bus rapid transit program exactly. And and you know it's 161 00:10:28,160 --> 00:10:31,960 Speaker 1: funny in the in the Trump program, the Trump budget, 162 00:10:32,200 --> 00:10:37,600 Speaker 1: it looks like money for mass transit, especially UH is 163 00:10:37,720 --> 00:10:42,160 Speaker 1: being cut back. And that's you know, of concern to 164 00:10:42,240 --> 00:10:46,360 Speaker 1: so many states and municipalities. If you're just defining infrastructure 165 00:10:46,720 --> 00:10:50,240 Speaker 1: as highways and bridges, uh, you're really taking out a 166 00:10:50,280 --> 00:10:54,000 Speaker 1: big element. But you know, this has been a a 167 00:10:54,160 --> 00:10:58,680 Speaker 1: sort of conservative hobby horse. If you will to uh, 168 00:10:59,000 --> 00:11:02,319 Speaker 1: you know, move against mass transit wherever you can. And 169 00:11:02,400 --> 00:11:06,880 Speaker 1: of course, the the city is higher density, UH, you know, 170 00:11:07,080 --> 00:11:10,960 Speaker 1: believe in mass transit. They believe in busses and also 171 00:11:11,559 --> 00:11:14,840 Speaker 1: light rail and regular rail. Well. I mean, there's an 172 00:11:14,880 --> 00:11:18,040 Speaker 1: Amtrak study that's sited in the Bloomberg story that says 173 00:11:18,679 --> 00:11:22,319 Speaker 1: that the gateway project would generate four dollars for everyone 174 00:11:22,440 --> 00:11:26,080 Speaker 1: spent and also drive the regional economy because we got 175 00:11:26,160 --> 00:11:28,640 Speaker 1: international competitors in the region, in the in the world, 176 00:11:28,679 --> 00:11:32,800 Speaker 1: right London, Tokyo, Berlin, they're all modernizing their transport hubs. 177 00:11:33,320 --> 00:11:36,120 Speaker 1: If you don't get this new tunnel, what do you 178 00:11:36,120 --> 00:11:40,160 Speaker 1: think happens? I mean, this tunnel is really hit by 179 00:11:40,160 --> 00:11:45,400 Speaker 1: the Hurricane Sandy that was back in Long overdue. Uh, 180 00:11:45,960 --> 00:11:49,600 Speaker 1: you need the new tunnel to bring in all the 181 00:11:49,679 --> 00:11:52,800 Speaker 1: commuters from New Jersey, and you know, business goes back 182 00:11:52,840 --> 00:11:57,560 Speaker 1: and forth, and this is really a it's almost astonishing. 183 00:11:57,920 --> 00:12:02,120 Speaker 1: But you know the thing about infrastructure finance is that 184 00:12:02,200 --> 00:12:04,560 Speaker 1: the so much of what the federal government does is 185 00:12:04,640 --> 00:12:08,680 Speaker 1: make sure that uh, everyone gets something. So you know, 186 00:12:08,760 --> 00:12:13,040 Speaker 1: you have highways in the frontier. Right. Well, I guess 187 00:12:13,120 --> 00:12:15,720 Speaker 1: yet to you know, balance the interests because obviously you need, 188 00:12:15,840 --> 00:12:18,880 Speaker 1: you know, all the political help you can get in Washington. 189 00:12:19,559 --> 00:12:22,040 Speaker 1: Let's talk about New Jersey a little bit more specifically, 190 00:12:22,080 --> 00:12:26,080 Speaker 1: because I want to understand what is happening. I understand 191 00:12:26,120 --> 00:12:32,080 Speaker 1: that it's called structurally imbalanced. Is that a new term? No? No, 192 00:12:32,240 --> 00:12:37,800 Speaker 1: structurally imbalanced. It's when states or municipalities. Uh, how can 193 00:12:37,880 --> 00:12:40,120 Speaker 1: I put it gracefully? I was gonna say, when they 194 00:12:40,120 --> 00:12:42,040 Speaker 1: can't leave, when they can't leave her on the building 195 00:12:42,080 --> 00:12:45,440 Speaker 1: doesn't work that structurally imbalanced. One side is heavier than 196 00:12:45,440 --> 00:12:47,840 Speaker 1: the other and it falls. That's not good. No, it's 197 00:12:47,880 --> 00:12:50,640 Speaker 1: not good. No. You know, you're spending more than you're 198 00:12:50,640 --> 00:12:54,400 Speaker 1: taking in and you have budget items that have to 199 00:12:54,440 --> 00:12:57,360 Speaker 1: go out and the revenue is not there. So in 200 00:12:57,400 --> 00:13:01,440 Speaker 1: this case, what what New Jersey is doing, um is 201 00:13:01,679 --> 00:13:04,839 Speaker 1: they're sort of shortsheeting the bed. They're going to pay 202 00:13:04,960 --> 00:13:09,480 Speaker 1: two and a half billion dollars toward the pension fund 203 00:13:09,760 --> 00:13:12,680 Speaker 1: when in fact they should be paying five billion this year. 204 00:13:13,320 --> 00:13:16,600 Speaker 1: Uh where you know in the new budget year. So um, 205 00:13:16,760 --> 00:13:19,800 Speaker 1: structurally and balanced, they you know, they keep they keep 206 00:13:19,840 --> 00:13:22,440 Speaker 1: playing with the pension system. Is the problem here, and 207 00:13:22,480 --> 00:13:25,719 Speaker 1: this goes back to if you want am I am 208 00:13:25,720 --> 00:13:28,680 Speaker 1: I right? And reading is that it is a one 209 00:13:28,760 --> 00:13:33,480 Speaker 1: hundred and thirty six billion dollars shortfall. Yes, they have 210 00:13:33,559 --> 00:13:37,840 Speaker 1: the they have about thirty seven and a half percent 211 00:13:38,400 --> 00:13:42,320 Speaker 1: or around there of the money they need. So they 212 00:13:42,600 --> 00:13:46,439 Speaker 1: you know, they they the least funded pension system among 213 00:13:46,480 --> 00:13:49,880 Speaker 1: the fifty states, right, and they have about eighty one 214 00:13:49,880 --> 00:13:52,760 Speaker 1: and a half eighty two billion dollars in assets, but 215 00:13:52,840 --> 00:13:56,680 Speaker 1: what they need is about two hundred and fifteen. So 216 00:13:57,040 --> 00:13:59,360 Speaker 1: there you go. That's why you have that big gap 217 00:13:59,480 --> 00:14:03,400 Speaker 1: there and S and p SS structurally imbalanced because you 218 00:14:03,520 --> 00:14:06,640 Speaker 1: really have to make these payments every year because it 219 00:14:06,679 --> 00:14:09,880 Speaker 1: adds up. You've heard that, Yeah, I think that's it 220 00:14:09,920 --> 00:14:12,640 Speaker 1: happens for people with credit cards as well. It eventually 221 00:14:12,679 --> 00:14:15,440 Speaker 1: adds up, don't you keep pushing it off and pushing 222 00:14:15,440 --> 00:14:18,120 Speaker 1: it off and pushing it off. And you know, unless 223 00:14:18,160 --> 00:14:22,240 Speaker 1: you're really breaking in the money with all your investments, 224 00:14:23,080 --> 00:14:25,520 Speaker 1: you know you have to do this. And New Jersey 225 00:14:25,560 --> 00:14:29,040 Speaker 1: has been has been woeful in putting aside that money 226 00:14:29,080 --> 00:14:33,560 Speaker 1: on a regular basis. The politicians just uh, you know, 227 00:14:33,600 --> 00:14:36,160 Speaker 1: they find it almost impossible. And now, on the other hand, 228 00:14:36,160 --> 00:14:38,920 Speaker 1: when the pension funds are doing well, they always have 229 00:14:38,960 --> 00:14:41,480 Speaker 1: to try to tap them right somehow you use them 230 00:14:41,480 --> 00:14:44,840 Speaker 1: as collateral or by bonds that then support some other 231 00:14:44,880 --> 00:14:48,640 Speaker 1: government activity. They're obsessed in New Jersey. Really it's been 232 00:14:48,760 --> 00:14:52,800 Speaker 1: you know, as I say, back to when the States 233 00:14:52,800 --> 00:14:57,320 Speaker 1: sold uh, the largest pension obligation bond ever back then 234 00:14:57,400 --> 00:14:59,720 Speaker 1: even though they didn't need to. Well, we always need 235 00:14:59,800 --> 00:15:02,840 Speaker 1: you and your guidance. Thanks very much. Joe Maisak, editor 236 00:15:02,880 --> 00:15:05,960 Speaker 1: for Bloomberg Briefs Municipal Markets. You've got to read it. 237 00:15:05,960 --> 00:15:23,200 Speaker 1: Go to Briefs, go on the Bloomberg. While a Border 238 00:15:23,280 --> 00:15:28,480 Speaker 1: Adjustment tax, personal and corporate tax reform. Brian Reardon is 239 00:15:28,520 --> 00:15:31,640 Speaker 1: a senior advisor to Ven Strategies. Is also a former 240 00:15:31,680 --> 00:15:34,800 Speaker 1: Special assistant to President George W. Bush for Economic Policy, 241 00:15:35,080 --> 00:15:39,720 Speaker 1: and was principal tax aid at the President's National Economic Council. 242 00:15:39,720 --> 00:15:41,600 Speaker 1: Brian Udon, thank you very much for being with us. 243 00:15:42,280 --> 00:15:44,560 Speaker 1: Thank you for having me tell us about the border 244 00:15:44,600 --> 00:15:47,200 Speaker 1: adjustment tax. How do you believe it would work and 245 00:15:47,280 --> 00:15:50,640 Speaker 1: what would be some of its ramifications. Sure, so, I 246 00:15:50,720 --> 00:15:53,000 Speaker 1: think one of the challenges that we have is in 247 00:15:53,120 --> 00:15:55,760 Speaker 1: talking about the border adjustment, it's gotten all the attention 248 00:15:56,280 --> 00:15:58,800 Speaker 1: and what's lost as the broader plan. So it's not 249 00:15:58,840 --> 00:16:03,240 Speaker 1: actually a border adjustment tax. It's a border adjustment of 250 00:16:03,280 --> 00:16:07,119 Speaker 1: the new cash flow tax that's envisioned in the House blueprint. 251 00:16:07,480 --> 00:16:09,120 Speaker 1: So what they're gonna do is they're first going to 252 00:16:09,240 --> 00:16:13,840 Speaker 1: repeal the business income tax that everybody uses right now. Second, 253 00:16:13,920 --> 00:16:16,720 Speaker 1: they're going to impose a cash flow tax, which means 254 00:16:17,200 --> 00:16:19,360 Speaker 1: that you get full expensing. It means that we're moving 255 00:16:19,400 --> 00:16:24,800 Speaker 1: to territorial it means you get lower rates for corporations, pastors. 256 00:16:24,880 --> 00:16:26,640 Speaker 1: And then what they're gonna do is they're going to 257 00:16:26,760 --> 00:16:29,360 Speaker 1: border adjust it just the same way that all our 258 00:16:29,400 --> 00:16:32,800 Speaker 1: trading partners border adjust their value out of taxes. So 259 00:16:32,920 --> 00:16:35,400 Speaker 1: the bottom line is that you're gonna pay lower rates 260 00:16:36,040 --> 00:16:38,880 Speaker 1: and when you produce something here, you're no longer going 261 00:16:38,920 --> 00:16:41,560 Speaker 1: to pay a higher tax than say, something that's imported 262 00:16:41,600 --> 00:16:43,880 Speaker 1: from another country and brought here and sold here in 263 00:16:43,920 --> 00:16:47,000 Speaker 1: the United States. So it's gonna put US producers and 264 00:16:47,160 --> 00:16:50,680 Speaker 1: US workers on a level playing field with everybody else 265 00:16:50,720 --> 00:16:52,920 Speaker 1: in the world by doing the same border adjustment to 266 00:16:52,960 --> 00:16:55,160 Speaker 1: their tax codes that that they do, we're going to 267 00:16:55,240 --> 00:16:58,840 Speaker 1: do it here. And is there evidence that this will 268 00:16:58,880 --> 00:17:02,720 Speaker 1: have the desire to effect to increase manufacturing and production 269 00:17:02,720 --> 00:17:05,720 Speaker 1: in the United States. Well, and that's another thing that 270 00:17:05,720 --> 00:17:09,080 Speaker 1: you've got to be real careful about. So the pro growth, 271 00:17:09,240 --> 00:17:12,760 Speaker 1: pro worker, pro wage provisions and the plan are the 272 00:17:12,800 --> 00:17:15,639 Speaker 1: lower rates, the move to expensing. So if you build 273 00:17:15,640 --> 00:17:17,719 Speaker 1: a factory, you buy a piece of equipment, you've got 274 00:17:17,720 --> 00:17:19,919 Speaker 1: an inventory, you get to write it off immediately. You 275 00:17:19,960 --> 00:17:22,600 Speaker 1: don't have to depreciate it over in the case of buildings, 276 00:17:22,600 --> 00:17:25,960 Speaker 1: you know, almost forty years. So it's that's the part 277 00:17:26,040 --> 00:17:29,480 Speaker 1: that's going to make investment in the United States, production 278 00:17:29,520 --> 00:17:32,160 Speaker 1: in the United States more attractive, which means you get 279 00:17:32,160 --> 00:17:35,560 Speaker 1: more investment, which means higher wages for workers, more jobs. 280 00:17:35,880 --> 00:17:37,760 Speaker 1: That's where the workers are going to be better off. 281 00:17:38,080 --> 00:17:40,680 Speaker 1: Those are the provisions that do that. The border adjustment 282 00:17:40,720 --> 00:17:44,720 Speaker 1: just does three things One, it because we run trade surpluses, 283 00:17:45,160 --> 00:17:47,760 Speaker 1: it raises some revenue, so we can get the rates 284 00:17:47,760 --> 00:17:51,919 Speaker 1: down to more competitive levels. Two And moving to territorial 285 00:17:52,280 --> 00:17:54,680 Speaker 1: right where we're just going to look at business activity 286 00:17:54,680 --> 00:17:56,960 Speaker 1: in the unit the United States from now on, we're 287 00:17:56,960 --> 00:18:00,240 Speaker 1: no longer going to chase business income. When it turned 288 00:18:00,280 --> 00:18:03,239 Speaker 1: into overseas jurisdictions, You've got to figure out a way 289 00:18:03,240 --> 00:18:06,040 Speaker 1: to enforce that right so that businesses don't continue to 290 00:18:06,080 --> 00:18:09,560 Speaker 1: shift their income to lower tax jurisdictions like Ireland. The 291 00:18:09,600 --> 00:18:12,639 Speaker 1: border adjustment does that because what it does is effectively 292 00:18:12,680 --> 00:18:14,800 Speaker 1: say you move your income, you can move your IP, 293 00:18:14,960 --> 00:18:17,000 Speaker 1: you can move all that stuff wherever you want. But 294 00:18:17,119 --> 00:18:19,120 Speaker 1: as long as you're bringing product back to the United 295 00:18:19,119 --> 00:18:21,000 Speaker 1: States to sell it, we're going to make sure that 296 00:18:21,080 --> 00:18:24,359 Speaker 1: taxes are paid at the appropriate level on those products. 297 00:18:24,400 --> 00:18:26,880 Speaker 1: So it creates the enforcement to the territorial. And then 298 00:18:26,920 --> 00:18:29,120 Speaker 1: the certain thing it does is I said it balances 299 00:18:29,160 --> 00:18:32,159 Speaker 1: out the tax. So if you produce something here, you 300 00:18:32,240 --> 00:18:34,520 Speaker 1: produce something elsewhere, and you import it back here, the 301 00:18:34,560 --> 00:18:37,120 Speaker 1: tax is going to be the same, so American workers 302 00:18:37,119 --> 00:18:40,480 Speaker 1: will no longer be at a disadvantage. Mr. Ridden, What 303 00:18:40,680 --> 00:18:45,280 Speaker 1: if you could maybe spell out the likelihood that this 304 00:18:45,480 --> 00:18:48,840 Speaker 1: will get past in the form that you describe, because 305 00:18:48,840 --> 00:18:50,440 Speaker 1: it seems as though there are a lot of things 306 00:18:50,480 --> 00:18:54,960 Speaker 1: that hinge on each other. And uh, once you open 307 00:18:55,000 --> 00:18:59,399 Speaker 1: the negotiating process, is there any assurance or any view 308 00:18:59,720 --> 00:19:02,359 Speaker 1: that going to get what you describe? Well, there are 309 00:19:02,359 --> 00:19:04,960 Speaker 1: no guarantees in life. But one of the things that 310 00:19:05,000 --> 00:19:07,520 Speaker 1: we're blessed with here is strong leadership in the form 311 00:19:07,560 --> 00:19:10,320 Speaker 1: of Speaker Ryan, the chairman of the Ways It Means Committee, 312 00:19:10,359 --> 00:19:13,439 Speaker 1: Kevin Brady. They are determined to make this happen. And 313 00:19:13,440 --> 00:19:15,600 Speaker 1: as you imagine, this is a big lift. I mean, 314 00:19:15,600 --> 00:19:19,159 Speaker 1: what we're talking about here is a dramatic reform of 315 00:19:19,160 --> 00:19:23,159 Speaker 1: how we tax business income. It's taking our tax system 316 00:19:23,160 --> 00:19:25,520 Speaker 1: from one of the worst two in my mind, one 317 00:19:25,520 --> 00:19:27,600 Speaker 1: of the best in the world. It will immediately make 318 00:19:27,600 --> 00:19:30,440 Speaker 1: our tax system much more attractive for businesses than anybody 319 00:19:30,480 --> 00:19:32,840 Speaker 1: else in the world. And it's not going to be 320 00:19:32,880 --> 00:19:36,240 Speaker 1: easy to get across those finish lines. Washington doesn't do big, 321 00:19:36,320 --> 00:19:40,280 Speaker 1: dramatic reforms easily. But let me let me just stop 322 00:19:40,280 --> 00:19:43,199 Speaker 1: you that why why should it be that challenging when 323 00:19:43,320 --> 00:19:46,280 Speaker 1: you have a Republican majority in the House, a Republican 324 00:19:46,320 --> 00:19:48,280 Speaker 1: majority I'll be it a small one in the Senate 325 00:19:48,600 --> 00:19:51,239 Speaker 1: and a Republican in the White House. Well, i'll give 326 00:19:51,280 --> 00:19:54,080 Speaker 1: you an example. So you know, I work extensively with 327 00:19:54,240 --> 00:19:59,080 Speaker 1: private companies, smaller companies, pastors, etcetera. And when you talk 328 00:19:59,160 --> 00:20:01,680 Speaker 1: to folks like that and you're talking about a new 329 00:20:01,720 --> 00:20:05,240 Speaker 1: idea like this, it takes them time to get comfortable 330 00:20:05,320 --> 00:20:08,240 Speaker 1: with it, right. They have to understand what it means 331 00:20:08,240 --> 00:20:11,320 Speaker 1: in all its ramifications for their business in order to 332 00:20:11,359 --> 00:20:13,040 Speaker 1: be supportive. So they got to look at not just 333 00:20:13,119 --> 00:20:16,399 Speaker 1: the border adjustment, but the lower rates, the move to expensing, 334 00:20:16,440 --> 00:20:18,920 Speaker 1: the interest changes that they're doing, all that stuff. They've 335 00:20:18,960 --> 00:20:21,040 Speaker 1: got to figure all that out, and that just takes time. 336 00:20:21,440 --> 00:20:23,840 Speaker 1: The opposition just have to figure out that they don't 337 00:20:23,880 --> 00:20:26,639 Speaker 1: like one part of it, and then they get activated 338 00:20:26,680 --> 00:20:29,960 Speaker 1: to fight that one part. So getting the business community 339 00:20:30,080 --> 00:20:34,199 Speaker 1: behind something that's dramatic like this and new, frankly, it 340 00:20:34,280 --> 00:20:36,680 Speaker 1: takes a little bit of time. And as I mentioned, 341 00:20:37,000 --> 00:20:39,919 Speaker 1: we're fortunate that we've got strong leadership over the House 342 00:20:40,200 --> 00:20:41,919 Speaker 1: where we're going to have the time to get the 343 00:20:41,920 --> 00:20:44,399 Speaker 1: business community behind it. And I think you've seen that 344 00:20:44,480 --> 00:20:46,880 Speaker 1: over the last month. You know, there's been a dramatic 345 00:20:46,960 --> 00:20:50,359 Speaker 1: increase in the number of people in the business community 346 00:20:50,400 --> 00:20:52,959 Speaker 1: expressing support for what the House is trying to do, 347 00:20:53,320 --> 00:20:56,919 Speaker 1: because it really is a pro American It's not you know, 348 00:20:56,960 --> 00:21:01,280 Speaker 1: it's not tariffs, it's not protectionism. All it's doing is saying, 349 00:21:01,560 --> 00:21:03,000 Speaker 1: you know, the rest of the world for the last 350 00:21:03,040 --> 00:21:05,840 Speaker 1: thirty years has been improving their tax codes and making 351 00:21:05,880 --> 00:21:09,400 Speaker 1: it more attractive for businesses to invest there rather than here. 352 00:21:09,480 --> 00:21:11,640 Speaker 1: We've been kind of stuck in place, and all we're 353 00:21:11,680 --> 00:21:13,479 Speaker 1: doing is exactly what the rest of the world has 354 00:21:13,520 --> 00:21:16,920 Speaker 1: been doing. Improve our tax code, make it much more efficient, 355 00:21:17,000 --> 00:21:19,720 Speaker 1: make it much simpler, and make it much more attractive 356 00:21:19,760 --> 00:21:23,440 Speaker 1: for people to invest here rather than someplace else. Thanks 357 00:21:23,440 --> 00:21:25,720 Speaker 1: for we got leave it there. Brian Reared, a former 358 00:21:25,760 --> 00:21:29,160 Speaker 1: Special Assistant to President George W. Bush for Economic Policy, 359 00:21:29,440 --> 00:21:46,359 Speaker 1: principal tax aid at the President's National Economic Council. Imagine 360 00:21:46,440 --> 00:21:51,040 Speaker 1: a third generation family business that goes public and now 361 00:21:51,080 --> 00:21:54,640 Speaker 1: has a market cap of more than two billion dollars. 362 00:21:54,880 --> 00:21:58,120 Speaker 1: Here to tell us about it is our own David Scannon, 363 00:21:58,200 --> 00:22:01,760 Speaker 1: Managing editor for Canada, and he joins us from Toronto. 364 00:22:01,840 --> 00:22:06,119 Speaker 1: David a pleasure tell us about Danny Reese. Who is 365 00:22:06,200 --> 00:22:09,359 Speaker 1: he and tell us about his business. I'm saving you 366 00:22:09,640 --> 00:22:14,680 Speaker 1: to give us the secret. Very interesting story Canada. Goose 367 00:22:14,800 --> 00:22:18,199 Speaker 1: is slowly becoming a household name for its high end 368 00:22:18,800 --> 00:22:22,280 Speaker 1: Parker's and coats. And it really started off as creating 369 00:22:22,400 --> 00:22:26,200 Speaker 1: gear for northern explorers. There was very small company. Enter 370 00:22:26,720 --> 00:22:29,560 Speaker 1: Uh Danny Reese into the scene twenty years ago. He 371 00:22:29,720 --> 00:22:33,640 Speaker 1: just finished school. He was English and philosophy major, had 372 00:22:33,680 --> 00:22:36,920 Speaker 1: no interest in joining the family business. He decided he'd 373 00:22:36,960 --> 00:22:39,439 Speaker 1: help out for a few months to finance some travel 374 00:22:39,560 --> 00:22:41,520 Speaker 1: to Europe, like a lot of people do after they 375 00:22:41,600 --> 00:22:45,119 Speaker 1: leave school. But he decided to stick around, and twenty 376 00:22:45,200 --> 00:22:47,320 Speaker 1: years later, you have this company. As you say, it's 377 00:22:47,359 --> 00:22:50,760 Speaker 1: worth more than two billion dollars. And he's done very 378 00:22:50,760 --> 00:22:54,800 Speaker 1: well for himself given their pretty strong debut. Uh. Their 379 00:22:54,840 --> 00:22:56,720 Speaker 1: I p O rather on the New York in Toronto 380 00:22:56,760 --> 00:22:59,840 Speaker 1: exchanges yesterday. Yeah. Well, I was looking at the stats 381 00:23:00,080 --> 00:23:03,280 Speaker 1: and the first day of trading the stock was oftent. 382 00:23:03,560 --> 00:23:08,800 Speaker 1: It's continued. It's a cent up twenty six now up 383 00:23:09,760 --> 00:23:12,880 Speaker 1: seven percent. This will make a very happy group of investors, 384 00:23:12,960 --> 00:23:17,360 Speaker 1: including those from Banning Company. Tell us about their involvement. Yeah, 385 00:23:17,400 --> 00:23:20,160 Speaker 1: so they bought the They bought seventy percent of the firm. 386 00:23:20,640 --> 00:23:23,119 Speaker 1: Four years ago. At the time the company was valued 387 00:23:23,160 --> 00:23:26,080 Speaker 1: at about two hundred and fifty million, and now as 388 00:23:26,080 --> 00:23:28,520 Speaker 1: you say, it's over two billion. So in just a 389 00:23:28,560 --> 00:23:31,160 Speaker 1: couple of short years they've done very well, as has 390 00:23:31,359 --> 00:23:34,560 Speaker 1: UH Danny Reese. We spoke to him yesterday and you know, 391 00:23:34,640 --> 00:23:38,320 Speaker 1: he was able to talk at about seventy million Canadian 392 00:23:38,400 --> 00:23:40,920 Speaker 1: just from the I p O for cutting his stake 393 00:23:40,960 --> 00:23:44,240 Speaker 1: a little bit, but he still has a sizeable portion 394 00:23:44,320 --> 00:23:46,639 Speaker 1: of the company, about twenty four percent, which is worth 395 00:23:47,240 --> 00:23:50,240 Speaker 1: another five and fifty million dollars as a Canadian dollars, 396 00:23:50,240 --> 00:23:53,480 Speaker 1: So combined he's got almost a half a billion US dollars. 397 00:23:53,520 --> 00:23:55,560 Speaker 1: So he's done very well for a guy who was 398 00:23:55,960 --> 00:23:59,240 Speaker 1: the initial plan was just to write fiction, so he's 399 00:23:59,280 --> 00:24:03,240 Speaker 1: come along well. It's turned into a wonderful reality for him. 400 00:24:03,920 --> 00:24:08,720 Speaker 1: The products, the prices, and the popularity give us the detail. 401 00:24:09,400 --> 00:24:13,360 Speaker 1: So as I mentioned, they make these high end parkers 402 00:24:13,359 --> 00:24:16,560 Speaker 1: for sub zero temperatures, but what they've managed to do 403 00:24:17,080 --> 00:24:22,080 Speaker 1: is transition to sort of a three season UH clothing company, 404 00:24:22,119 --> 00:24:24,560 Speaker 1: if you will, So it's not just the expensive Parkers, 405 00:24:24,560 --> 00:24:27,399 Speaker 1: which do very well in the harsh Canadian winter what 406 00:24:27,520 --> 00:24:29,840 Speaker 1: is an expensive parko? How much are we talking about 407 00:24:29,880 --> 00:24:33,960 Speaker 1: a thousand dollars Canadian? Now about nine thousand US, so 408 00:24:33,960 --> 00:24:37,639 Speaker 1: they can run fifteen Canadian So they are not they 409 00:24:37,680 --> 00:24:39,960 Speaker 1: are not cheap. But what they're doing now is they're 410 00:24:39,960 --> 00:24:43,760 Speaker 1: branching into lighter coats which you might wear and you 411 00:24:43,800 --> 00:24:47,120 Speaker 1: know spring and fall in New York or Paris or Tokyo, 412 00:24:47,200 --> 00:24:50,040 Speaker 1: and that's where the growth is going to come from. 413 00:24:50,080 --> 00:24:53,679 Speaker 1: Their The market is getting a little bit saturated in Canada, 414 00:24:53,720 --> 00:24:56,280 Speaker 1: for example, but they think that they can go three season, 415 00:24:56,880 --> 00:24:59,199 Speaker 1: they can sell more coats and and do better, and 416 00:24:59,240 --> 00:25:01,880 Speaker 1: that's why it's it's trading as such a high multiple 417 00:25:02,000 --> 00:25:05,920 Speaker 1: right now. Following the I p O store locations, they 418 00:25:05,960 --> 00:25:09,040 Speaker 1: want to open more brick and mortar stores. They do. 419 00:25:09,119 --> 00:25:11,160 Speaker 1: They have two right now, one in Toronto and one 420 00:25:11,200 --> 00:25:13,280 Speaker 1: in New York if they plan to open a couple 421 00:25:13,320 --> 00:25:16,200 Speaker 1: more next year. When I spoke with Danny yesterday, he 422 00:25:16,320 --> 00:25:20,280 Speaker 1: was hinting Paris in Tokyo seemed like logical next steps. 423 00:25:20,359 --> 00:25:23,320 Speaker 1: But they may add another fifteen to twenty over the years. 424 00:25:23,320 --> 00:25:26,400 Speaker 1: There their approaches that you've got to be has some 425 00:25:26,520 --> 00:25:29,360 Speaker 1: bricks and mortar presents to show off your brand, especially 426 00:25:29,400 --> 00:25:32,120 Speaker 1: in areas where you are not known. At the same time, 427 00:25:32,160 --> 00:25:34,560 Speaker 1: you can augment that with some online sales. That's where 428 00:25:34,560 --> 00:25:38,399 Speaker 1: they're going. What did Baine bring to the company in 429 00:25:38,440 --> 00:25:40,800 Speaker 1: addition to the money, Yeah, I think they brought some 430 00:25:40,880 --> 00:25:45,520 Speaker 1: global expertise and they think they've helped them developed the brand. 431 00:25:45,560 --> 00:25:48,680 Speaker 1: And it really is a brand. It's it's retail, it's fashion. 432 00:25:48,960 --> 00:25:51,960 Speaker 1: You know, it can be fickle, but there is is 433 00:25:52,000 --> 00:25:55,359 Speaker 1: something about the sort of that rugged Canadian brand that 434 00:25:55,440 --> 00:25:58,440 Speaker 1: they are. They have captured and they're exporting it around 435 00:25:58,440 --> 00:26:00,320 Speaker 1: in the world and we'll see how they do well 436 00:26:00,359 --> 00:26:03,480 Speaker 1: maide in Canada, and that's something that Danny Reese said 437 00:26:03,560 --> 00:26:06,160 Speaker 1: he wants to continue to do. He does the idea 438 00:26:06,240 --> 00:26:08,680 Speaker 1: I asked him about, you know, the possible border tax 439 00:26:08,760 --> 00:26:11,720 Speaker 1: and you know Trump's pushed to get more manufacturing in 440 00:26:11,760 --> 00:26:14,080 Speaker 1: the United States, who say, no, part of our identity, 441 00:26:14,200 --> 00:26:16,480 Speaker 1: part of our culture is that we are made in 442 00:26:16,560 --> 00:26:19,640 Speaker 1: Canada and we want to stick with that. Montclair can 443 00:26:19,680 --> 00:26:23,240 Speaker 1: be viewed as a competitor the the French company. I 444 00:26:23,280 --> 00:26:27,880 Speaker 1: beg your pardon. Is there a conscious sort of look 445 00:26:27,920 --> 00:26:30,639 Speaker 1: over the shoulder at what has happened to Montclair as 446 00:26:30,680 --> 00:26:34,080 Speaker 1: an international brand. I think so they're very much in 447 00:26:34,119 --> 00:26:38,199 Speaker 1: the same in the same UH segments. They're doing very 448 00:26:38,240 --> 00:26:41,120 Speaker 1: well in Europe, but the Canada Goose seems very determined 449 00:26:41,160 --> 00:26:43,920 Speaker 1: to go right at them in their home market. They're 450 00:26:44,040 --> 00:26:49,320 Speaker 1: very interested in Germany, Scandinavia, UH, Italy, So it would 451 00:26:49,359 --> 00:26:55,280 Speaker 1: be very interesting competition, right, I beg your pardon, Milan based, Yes, 452 00:26:55,440 --> 00:26:58,040 Speaker 1: I beg your pardon. Stock there is up twenty one 453 00:26:58,960 --> 00:27:03,600 Speaker 1: so far this year. As the company grows, do they 454 00:27:03,680 --> 00:27:07,520 Speaker 1: have the management team in order to manage that growth? 455 00:27:08,119 --> 00:27:10,199 Speaker 1: You know, that's the challenge. You know, Danny has been 456 00:27:10,200 --> 00:27:12,080 Speaker 1: there for a long time, but it was a much 457 00:27:12,119 --> 00:27:14,880 Speaker 1: smaller company than he was. You know, sales of five 458 00:27:15,000 --> 00:27:18,760 Speaker 1: ten million back then. They're closer to four million now. 459 00:27:18,800 --> 00:27:20,639 Speaker 1: And so being they have brought in a lot of 460 00:27:20,680 --> 00:27:24,120 Speaker 1: new people with a lot of marketing expertise, a lot 461 00:27:24,119 --> 00:27:28,280 Speaker 1: of brand development, and and that's that's really their challenge now, 462 00:27:28,400 --> 00:27:30,920 Speaker 1: is trying to export this brand. Well, not only that, 463 00:27:30,960 --> 00:27:35,320 Speaker 1: but I noted from your piece taking a look at 464 00:27:35,480 --> 00:27:41,760 Speaker 1: their succession policy or decision making process for that. Danny 465 00:27:41,800 --> 00:27:46,719 Speaker 1: Rees spoke to that issue. Um, yes, well, he's certainly 466 00:27:47,320 --> 00:27:50,080 Speaker 1: aware that he you know, he needs he heeds help. 467 00:27:50,119 --> 00:27:52,639 Speaker 1: It's a very um, it's a new company. It's a 468 00:27:52,640 --> 00:27:57,479 Speaker 1: small board. Uh. He talked later to me about expanding that, 469 00:27:57,560 --> 00:28:02,240 Speaker 1: bringing in more expertise, bringing more are women interesting that interestingly, 470 00:28:02,440 --> 00:28:04,840 Speaker 1: there's not a single woman on the board right now, 471 00:28:04,880 --> 00:28:07,920 Speaker 1: and he's aware of that. He thinks diversity is important 472 00:28:07,920 --> 00:28:10,320 Speaker 1: to him. And you'd have to imagine. I don't have 473 00:28:10,359 --> 00:28:12,520 Speaker 1: the stats, but imagine a lot of those coats are 474 00:28:12,560 --> 00:28:15,080 Speaker 1: being bought by women, so that would make sense. Well, 475 00:28:15,119 --> 00:28:17,680 Speaker 1: I was just going to refer to the third generation 476 00:28:17,840 --> 00:28:22,480 Speaker 1: family business curse that many people right yet, and I 477 00:28:22,480 --> 00:28:25,000 Speaker 1: think he figures that he's he's going to be okay 478 00:28:25,080 --> 00:28:27,199 Speaker 1: because it was never preordained. You know, a lot of 479 00:28:27,240 --> 00:28:30,320 Speaker 1: times you get third generation sons and daughters who are 480 00:28:30,359 --> 00:28:33,239 Speaker 1: sort of forced into taking over the company when they 481 00:28:33,240 --> 00:28:36,600 Speaker 1: don't have much interest. In his case, it was the opposite. 482 00:28:36,640 --> 00:28:38,320 Speaker 1: He had no interest, but he sort of fell in 483 00:28:38,360 --> 00:28:40,920 Speaker 1: love with it and sort of developed passion for it. 484 00:28:41,200 --> 00:28:43,840 Speaker 1: All right, Well, just last point, David, do you have 485 00:28:43,920 --> 00:28:51,560 Speaker 1: a Canada goose? I do not. They must they mustn't 486 00:28:51,640 --> 00:28:54,640 Speaker 1: be for fashionists, because boy, you see them almost everywhere 487 00:28:54,680 --> 00:28:57,400 Speaker 1: and it's not that cold, you know, and everyone who 488 00:28:57,400 --> 00:29:01,920 Speaker 1: has them really raised about them? So next winter maybe, Pim. Alright, 489 00:29:01,960 --> 00:29:04,760 Speaker 1: well I can aspire as did Danny Reese aspiring to 490 00:29:04,800 --> 00:29:08,520 Speaker 1: be a writer, now a millionaire running Canada Goose. Thanks 491 00:29:08,600 --> 00:29:11,440 Speaker 1: very much. The shares of Canada Goose up about six 492 00:29:11,480 --> 00:29:19,440 Speaker 1: and a half percent right now. Thanks for listening to 493 00:29:19,480 --> 00:29:22,800 Speaker 1: the Bloomberg pien L podcast. You can subscribe and listen 494 00:29:22,840 --> 00:29:28,200 Speaker 1: to interviews at iTunes, SoundCloud, or whatever podcast platform you prefer. 495 00:29:28,480 --> 00:29:31,800 Speaker 1: I'm Pim Fox. I'm out there on Twitter at pim Fox. 496 00:29:32,080 --> 00:29:34,760 Speaker 1: I'm out there on Twitter at Lisa Abramo. It's one 497 00:29:35,040 --> 00:29:37,760 Speaker 1: before the podcast. You can always catch us worldwide on 498 00:29:37,840 --> 00:29:38,600 Speaker 1: Bloomberg Radio