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Speaker 2: three hour conversation with Dan Eisa web Bush's I don't
Speaker 2: know where where's he? Ben?
Speaker 3: I know?
Speaker 2: I think he's so large now that we can't even
Speaker 2: get them on the show. Dan, let's talk Tesla first.
Speaker 2: I know you're gonna give me the positive spin. Liam
Speaker 2: Denning writes a beautiful column must tells Tesla dream, but
Speaker 2: don't ask for the details. What's the timeline across April
Speaker 2: May June to where Musk has to seep out the
Speaker 2: successful initiation of the so called plan.
Speaker 4: Look, I think last night was a big start because
Speaker 4: the sub thirty K vehicle. I'll call it a Model
Speaker 4: two point five. It's going to be accelerated. I mean,
Speaker 4: this would I come first half twenty twenty five, and
Speaker 4: more details clearly have to come out, but this is
Speaker 4: no new factory line. I think this is a huge
Speaker 4: start for what the bulls needed to hear on the
Speaker 4: Tesla story, especially given the dark days and what was
Speaker 4: really a train wreck one Q.
Speaker 2: I mean at Paul to jump in here, because you know,
Speaker 2: Dan and I don't agree on this. I mean, you
Speaker 2: know he's a good friend, but you know, I'm just
Speaker 2: I'm with Liam Denning. I'm like, are you kidding me?
Speaker 2: That was a conference? Was that a conference called dan ives.
Speaker 4: Relative to the last few calls, which we talked about, right,
Speaker 4: I mean it was a disaster. Last night you actually
Speaker 4: had a vision. The growth strategy was laid out, talked
Speaker 4: about the lower cause vehicle, and the fears were they
Speaker 4: were going to go straight to rover, taxis and autonomous.
Speaker 4: That was a big overhang in the stock. And then
Speaker 4: you look at the margin the cause cuts. I finally
Speaker 4: feel like they're a blue crib.
Speaker 2: Paul.
Speaker 4: After a few quarters, Paul helped me.
Speaker 2: Here I'm on sixth Avenue. I'm trying to get up
Speaker 2: to Central Park South Shore. Who was to go left
Speaker 2: or right? It's a roulette. What's the robotext you do?
Speaker 2: When you all the cars are turning right on fifty
Speaker 2: eighth street. Explain what a robotext he does. It's sixth
Speaker 2: Avenue in fifty eight He's.
Speaker 5: Gonna employ artificial intelligence. AI is what's gonna happen?
Speaker 2: Yeah?
Speaker 3: For you?
Speaker 5: Hey, Dan, So I guess I got off that call yesterday.
Speaker 5: I was walking on the borderwalk down the shore. I
Speaker 5: actually dialed into the call to listen, and I got
Speaker 5: off the call saying I either believe and I buy
Speaker 5: the stock, or I don't and I sell the stock.
Speaker 5: Is that where we are now with the stock? Do
Speaker 5: you think?
Speaker 4: Definitely? Look, I think it's the knives have been sharpened.
Speaker 4: So bulls and bears you meet the bed here?
Speaker 2: Yeah, night.
Speaker 4: Look I heard from many bears obviously over the last
Speaker 4: you know, called sixty eight hours. They'll have their stor
Speaker 4: But I think for the bulls, they finally have something
Speaker 4: to hang their hat on. And again betting on betting
Speaker 4: against Musk for the last four or five years. It's
Speaker 4: like betting against truths in this series.
Speaker 2: He has done this before. Some question, Okay, I'm tesseling
Speaker 2: out Dan ives on Microsoft. That's going to be a
Speaker 2: different call, a different earnings report, isn't it? All?
Speaker 6: Right?
Speaker 4: Look, this is the tactician. I mean, you have the
Speaker 4: hall of fame in Thedella. The AI revolution, it's here,
Speaker 4: and I think demonization that we're starting to see at Microsoft,
Speaker 4: we see it, you know, across I think the software layer.
Speaker 4: This is the call the whole street's going to be
Speaker 4: watching because it chows where the monization of AI is
Speaker 4: as the baton gets handed from Nvidia to Microsoft.
Speaker 5: So, Dan, that's kind of where I think a lot
Speaker 5: of investors would like to see this Microsoft story go.
Speaker 5: It's up eight percent year to date, it is not
Speaker 5: getting fully priced in as an AI story. It seems
Speaker 5: like relative to some other names like Nvidia. What do
Speaker 5: you think Microsoft needs to say on their call tomorrow
Speaker 5: to maybe gotta get that story across a little bit more.
Speaker 4: Look, I think it's really numbers. It's showing co pile
Speaker 4: it in terms of what deployments looking at the moonization.
Speaker 4: Of course, Azure the cloud number is the big focus
Speaker 4: as that actually continues to be something that's probably the
Speaker 4: best barometer in terms of what the Microsoft story is doing. Look,
Speaker 4: they have massive talents, and I think the broader story
Speaker 4: we're going to see across tech earning season is the
Speaker 4: air revolutions. Here the has been handed from Semis to
Speaker 4: software and memes like service Now, sALS Force, Oracle, among others.
Speaker 2: And Dan on Microsoft, I go back. I just take
Speaker 2: everything from pre pandemic. Basically, Microsoft modeled out twenty twenty
Speaker 2: four has done a double in revenue since twenty nineteen.
Speaker 2: Is that an extrapolated function? Can you take a double
Speaker 2: in revenue over five six years and take that out
Speaker 2: into the DAN ives twenty and.
Speaker 4: Thirty, Well, and Tom, I'd take it one even step better.
Speaker 4: It's really about the AI and the cloud component because
Speaker 4: fifty five percent revenue is cloud from Microsoft today, next
Speaker 4: three to four years, it's going to be seventy seventy
Speaker 4: per That multiple is going to continue to expand because
Speaker 4: that higher margin business. That's why I believe it there's
Speaker 4: a four trillion dollar mark happening year.
Speaker 2: Dan. A rep on you is you're an uber bowl,
Speaker 2: What is your what is your least favorite tech company?
Speaker 2: One of which one has the I Z and radar up.
Speaker 7: Look.
Speaker 4: I'd say it's some of the legacy names. If I
Speaker 4: look at like a Cisco as a shared doinger, I
Speaker 4: think some of those are the ones that are really
Speaker 4: gonna struggle if they don't get aggressed. But even look
Speaker 4: at Cisco, they buy spunk, right. I mean, the point
Speaker 4: is this is gonna be really an arms trace that's
Speaker 4: going to have good time. We've talked about. I think
Speaker 4: tech this is just second third inning of this tech
Speaker 4: ball market. And dam is I guess one.
Speaker 5: Of the questions Dan, I guess one of the questions
Speaker 5: for a lot of folks who follow tech is just
Speaker 5: kind of this AI trying to size out AI and
Speaker 5: how much of the AI capex? How much of the
Speaker 5: AI investment over the next five plus years is incremental
Speaker 5: or is it just taking from other parts of the
Speaker 5: tech stack. How do you model that up?
Speaker 4: I think about sixty seventy percent of it is incremental
Speaker 4: because the difference is that it's revenue generally. I mean,
Speaker 4: if you look at the use cases, they're revenue generating.
Speaker 4: This is not just spending on infrastructure, and I think
Speaker 4: that's what's happening really across verticals and we're starting to
Speaker 4: see you now. I mean you look at Pollneer. It's
Speaker 4: a good example where the use cases are exploding and
Speaker 4: the cap act is just massive, not just some big tech.
Speaker 4: But I think what we're seeing across the board.
Speaker 2: I mean, you know, dance like's got the sweats your
Speaker 2: thing going. For those of you are not on YouTube,
Speaker 2: I mean it's a stunning pick. Do you do five
Speaker 2: or ten miles this morning? Are you gonna go out
Speaker 2: for you know, pre pre morning.
Speaker 4: Jogged in I I'll do a little peloton and you know,
Speaker 4: to to get the heart rate up.
Speaker 2: It's good. I take Tank zero for the heart right, Dan,
Speaker 2: I thank you so much. With web Bush right now,
Speaker 2: she's more than a nothing burger. She is exquisite. In
Speaker 2: the analysis of the American economy, Lindsay Pigs joins us
Speaker 2: Now with Steve Lindsay, how do you use cap goods
Speaker 2: x air ex Boeing non defense? How do you use
Speaker 2: one of these obscure statistics?
Speaker 1: Well, I wouldn't argue that it's overly obscure. When we
Speaker 1: look at capital goods orders and we exclude aircraft and defense.
Speaker 1: What we're really doing is removing that volatile transportation component,
Speaker 1: and we can see them the underlying trend for business investment.
Speaker 1: And in fact, the reason that we need to do
Speaker 1: that is because when we look at something like last
Speaker 1: month's numbers, transportation plunged nearly twenty percent. So we need
Speaker 1: to take out that volatility to really get a sense
Speaker 1: where business investment is going, and right now it seems
Speaker 1: to be still positive, but very minimal growth in terms
Speaker 1: of those capital those investment dollars flowing out into the marketplace.
Speaker 2: Elon Musking to call us night, he says, I want
Speaker 2: to see cap goods orders, non defense X, aer X,
Speaker 2: TESLA X test. Let's coming next.
Speaker 5: So, lindsay, just stepping back here, what's kind of the
Speaker 5: Stefel GDP call for the remainder of this year and
Speaker 5: maybe for next year. I mean, I think a lot
Speaker 5: of folks feel like the economy may not be working
Speaker 5: for them despite some of the headline numbers.
Speaker 1: Well, I think the economy right now is still solid.
Speaker 1: We're still seeing consumer spending, we're still seeing businesses investing,
Speaker 1: but as I mentioned, we're losing momentum. We're seeing those
Speaker 1: heightened signs of fatigue. So what does that translate into
Speaker 1: for GDP. We're looking for about a two to two
Speaker 1: and a half ish percent average pace for twenty twenty four. Now,
Speaker 1: of course, volatility quarter to quarter aside Q one may
Speaker 1: come in a little stronger, but two to two and
Speaker 1: a half percent for the current year. The bigger question
Speaker 1: is where do we go into twenty twenty five, because
Speaker 1: if we continue to lose momentum, we've gone from five
Speaker 1: percent in the third quarter, so let's call it three
Speaker 1: percent a year end. If we hit that range of
Speaker 1: two two and a half this year, what if we
Speaker 1: continue to lose momentum into next year. Now we're virtually
Speaker 1: falling below the bare minimum that you would expect from
Speaker 1: a developed economy. But at this point is the FED
Speaker 1: still tolerating above target inflation? So that's my biggest concern
Speaker 1: that we're slowly moving into more of a stagflation scenario.
Speaker 2: I AS's this question the other day, Lindsey. But the
Speaker 2: fact is a central bank can't get out front, whether
Speaker 2: it's easy BE or FED or the Bank of Thailand.
Speaker 2: I mean they have to wait and go ex.
Speaker 1: Post right, I would argue the FED is right now,
Speaker 1: the FED is backing itself into the corner. The Fed
Speaker 1: should have risen rates. They should have raised rates higher.
Speaker 1: Now that they see inflation reversing course for three consecutive
Speaker 1: months since the start of the year, they need to
Speaker 1: re engage, raise rates to a sufficiently restrictive level to
Speaker 1: get price pressures under control and we can start to
Speaker 1: talk about a sustainable recovery. The longer they slow play this,
Speaker 1: the more price pressures become entrenched into the economy, and
Speaker 1: the more difficult it's going to be to ever get
Speaker 1: us back to that two percent target.
Speaker 2: Cancel the pigs a lunch of the Eckles building. That's
Speaker 2: all I can said. Folks, what you just heard there
Speaker 2: from this is classic Lindsay piigs. What you just said
Speaker 2: is a huge deal.
Speaker 5: So Lindsay, just to be clear here, you think that
Speaker 5: inflation is such that the Fed's next move should be
Speaker 5: a rate increase versus a cut.
Speaker 1: When we look at inflation, the target is two percent,
Speaker 1: The target is not three, the target is not three
Speaker 1: and a half. So the Fed has not met their
Speaker 1: mandate of stable prices, and with momentum now turning to
Speaker 1: the upside, I think the Fed has more work to do.
Speaker 4: Now.
Speaker 1: That's my preference for what the Fed should do. That's
Speaker 1: not what I necessarily expect the FED to do. This
Speaker 1: is a FED that desperately wants to provide relief. So
Speaker 1: I do still think that the next move is likely
Speaker 1: a rate cut, but I think that would be a
Speaker 1: material mistake on the part of the central bank.
Speaker 2: Wow, so inflation.
Speaker 5: Is your sense that this inflation that we've seen in
Speaker 5: the past three months, that's something that's that's not a blip,
Speaker 5: that's something more.
Speaker 1: I do think it's something more. If you think about
Speaker 1: the motivation for the FED to raise the rates, it's
Speaker 1: to increase borrowing costs, make that more onerous, slow consumption,
Speaker 1: and by extension, slow the economy and result in more
Speaker 1: benign inflation. But when we look at this consumer, there
Speaker 1: is still a good amount of spending and borrowing power
Speaker 1: out there in the economy. So clearly the FED has
Speaker 1: not done enough to slow, let alone break, the consumer
Speaker 1: to ensure a return to price stability.
Speaker 2: What's the response of your clients, and particularly your institutional clients, lindsay,
Speaker 2: when you say this, I mean, you know, I'm not
Speaker 2: going to say you're an outlier call here. I think
Speaker 2: Jim Biako's really led with the idea disinflation vectors out
Speaker 2: of tune. But these are really aggressive comments you're making.
Speaker 2: What is the response of your institutional clients to this.
Speaker 1: Well, again, this is what I would hope the FED
Speaker 1: would do. But when we look at our forecast, when
Speaker 1: we look at the messaging from the FED, the FED
Speaker 1: does appear willing to tolerate above target inflation. So again,
Speaker 1: our expectation is that the FED will offer at least one,
Speaker 1: if not two rate cuts by the end of the year,
Speaker 1: given their desire to continue to perpetuate these solid conditions
Speaker 1: in the economy. But when we look at I think
Speaker 1: the longer run stability of the economy, the longer run
Speaker 1: ability for us to get back to price stability. That's
Speaker 1: where I struggle because historically we see that the FED
Speaker 1: does need to raise rates above the previous speak in inflation.
Speaker 2: Well, when Kashkari's out the door and you're the president
Speaker 2: of the Federal Reserve Bank of Minnesota, Lindsay Piegs, just
Speaker 2: simply if we get a PIEGSA rate rise, does that
Speaker 2: push send a recession.
Speaker 1: I don't necessarily think a recession is necessary to get
Speaker 1: price stability, but I do think that a much slower
Speaker 1: growth rate would likely be the outcome, which is not
Speaker 1: necessarily again, is something that we need to avoid at
Speaker 1: all costs. That the normal fluctuations of the business cycle
Speaker 1: are very healthy, but the biggest issue is getting us
Speaker 1: back to a point where inflation is under control and
Speaker 1: that allows everyone to enjoy and participate in the economy.
Speaker 2: I just sent one of our interns of note, lindsay,
Speaker 2: I want to get you on next week after PCE.
Speaker 2: I mean, I think these folks, these are wild comments.
Speaker 2: These are you know, and again this is a prescriptive idea.
Speaker 2: Paul should of it could and you're saying, what will
Speaker 2: they do? They're just going to hold rates here, lindsay,
Speaker 2: until they see more data.
Speaker 1: I do think the FED is on an extended pause
Speaker 1: for now. But again, if inflation stabilizes at these levels,
Speaker 1: with the FED willing to tolerate above target inflation, I
Speaker 1: think the FED would be willing to give us twenty
Speaker 1: five or fifty basis points of cuts by year end,
Speaker 1: But if we don't see further improvement in the inflation data,
Speaker 1: they would likely return to the sideline for a second round.
Speaker 2: Extended ouse, Lindsey, thank you, thank you, thank you, just
Speaker 2: superb We'll feature that on Single Best Idea Today out
Speaker 2: on ample podcasts. Those are stunning statistics from Doctor Pigs
Speaker 2: at Aero Rana in Chicago's Encyclopedic going to Cloud a
Speaker 2: Man Deep saying picks up the pieces on Meta as well.
Speaker 2: Thrilled to have them with us right now into this
Speaker 2: tech earnings season, I guess I gotta go to Meta first.
Speaker 2: Facebook is what I call does change the symbol, Man
Speaker 2: saying this is simply Zuckerberg. Did he start all this
Speaker 2: cost cutting? Is Zuckerberg the one that gave the billionaire
Speaker 2: set permission to cut costs?
Speaker 3: Yeah, and he was quite aggressive, and he was right
Speaker 3: in terms of pivoting to AI and the three hundred.
Speaker 2: And fifty eight percent from the Man Deep sing bottom
Speaker 2: after sings and shut up and buy it. Yeah.
Speaker 3: Look, I think everyone had their doubts whether this company
Speaker 3: can ever grow double digit again the top line, and
Speaker 3: they have shown, you know, they have executed around their
Speaker 3: cost cuts and also from a product perspective, they have
Speaker 3: made a lot of changes in terms of the ad stack.
Speaker 2: Pivot to AI. I think kind of.
Speaker 3: Moving away from metaverse last year was a great bet
Speaker 3: and it's paid off in terms of you know what
Speaker 3: they are doing with ad impressions and pricing versus what
Speaker 3: the other players are doing.
Speaker 5: Hey, an rag out in Chicago, the tech hub of Chicago.
Speaker 5: I got the stock Microsoft. I'm surprised it's only up
Speaker 5: eight percent yearnit date.
Speaker 2: I thought it would have been more.
Speaker 5: It seems like these guys are just hitting on all cylinders.
Speaker 5: It's a great AI play. What is the story on
Speaker 5: Microsoft these days? What do you expect to hear from them,
Speaker 5: see from them from their earnings.
Speaker 7: It's still trading at over thirty times earnings compared to
Speaker 7: you know, Apple at twenty three times. So always remember
Speaker 7: that that, you know, the market gap is so high
Speaker 7: at this point, so some of those expectations already baked
Speaker 7: in for what they're going to realize, whether it's on
Speaker 7: the AI side or whether it's on the you know,
Speaker 7: the GitHub or Office three sixty five. So there's a
Speaker 7: lot of that. I would say it is currently baked
Speaker 7: into the price.
Speaker 2: Oh good, No, I.
Speaker 5: Was saying me, Man deep Facebook Google again, Tom and
Speaker 5: I we go old school verbiag here Facebook Google. It's
Speaker 5: a play on digital advertising in very large part. What's
Speaker 5: the state of the digital advertising market out there? Because
Speaker 5: you look the linear television and all they have is
Speaker 5: healthcare ads for various diseases. They don't have any real
Speaker 5: advertisers anymore.
Speaker 2: Are they all on digital?
Speaker 3: And so that secular move is still playing out. I
Speaker 3: would say that, you know, the sentiment around small businesses
Speaker 3: is still pretty weak, and when you look at a
Speaker 3: company like Meta, they are exposed more to small business
Speaker 3: ad spending. So I'm surprised they're able to grow top
Speaker 3: line twenty five percent even with the SMB spending being weak.
Speaker 3: And some of it is easier comps, so that'll get
Speaker 3: tougher in the second half, but still it is pretty remarkable.
Speaker 2: And now for all of you worldwide, we go CFA
Speaker 2: with Enterragriana and Man Deep Sing. Okay, I want to
Speaker 2: look at discount of cash flow, and there's this idea
Speaker 2: of terminal value. Now the triple leverage all cash fund
Speaker 2: is on a perpetuity terminal value. I mean, we're just
Speaker 2: going out forever, Man Deep Sing in tech in general,
Speaker 2: in these magnificent four, five, six, eight, whatever it is,
Speaker 2: How do you study terminal value or is that impossible?
Speaker 1: No?
Speaker 3: I think with companies of these sizes in terms of
Speaker 3: where their top line is clearly, you know, for them
Speaker 3: to keep growing double digit, it's extremely tough, and so
Speaker 3: you've got to model and growth decelerating. But what they
Speaker 3: have shown us in the past eighteen months is there's
Speaker 3: so much leverage to be gained from cost cuts. They
Speaker 3: were not crunning efficiently. And that's what I think is
Speaker 3: a key driver.
Speaker 2: Icly framed your interet around how do you do a
Speaker 2: terminal value, for example, on Microsoft? Because I got double
Speaker 2: digit revenue growth, I got to model that in maybe
Speaker 2: it's a harmonic deceleration whatever whatever you're doing. And then
Speaker 2: and Mandy correctly says, there's a new religion in cost cuts.
Speaker 2: So where's your terminal on Microsoft? You go on a decade?
Speaker 7: Yeah, and you know with Microsoft there's a slight difference
Speaker 7: because they are spending a lot on data centers. So
Speaker 7: I have a concept that is, you know, you want
Speaker 7: to look at operating cash flow more than you want
Speaker 7: to look at free cash flow right now, because their
Speaker 7: capex is more than three times. So if you see
Speaker 7: the operating cash flow growing at the face, so it
Speaker 7: is it's actually getting to a point that it's getting
Speaker 7: better than Apple at this point with the potential of
Speaker 7: growing top line between ten to fifteen percent at least
Speaker 7: for the next five years. So I think Microsoft is
Speaker 7: in a better position than any other tech company right
Speaker 7: now in our view because of the ability to drive
Speaker 7: those operating cash flows.
Speaker 5: And Tom's just going to fa function for Microsoft. Cappecs
Speaker 5: Capex in their fiscal twenty twenty year was fifteen billion
Speaker 5: this year for the June twenty four year forty three
Speaker 5: billions of forecast.
Speaker 2: The operating margin on Microsoft folks is forty four percent.
Speaker 2: When did these get too big? Bandeep? I mean the
Speaker 2: first business book I read was I to Turble Standard
Speaker 2: Will I'm fifteen years old, I'm reading I to Tarble.
Speaker 2: I didn't have an okay, but just thank you Lisa.
Speaker 2: When did they just get too big? For Washington? I mean,
Speaker 2: if you extrap a light out and Rod Rana is
Speaker 2: operating cash flow, there's a point where they're too big, right, Yeah?
Speaker 3: I mean, and I would use Meta as a proxy.
Speaker 3: Before they started investing in reality labs, their operating margin
Speaker 3: was nor till fifty percent. So it got to a
Speaker 3: point where they had to do something with all the
Speaker 3: cash that they were generating, and they started investing in
Speaker 3: reality labs and look the regulators they are looking at
Speaker 3: all of these companies, including partnerships. That's a new way
Speaker 3: to acquire for a lot of these companies. But in
Speaker 3: the end, you know, they are terrific business models, and
Speaker 3: they are sustainable.
Speaker 2: Free cash flow, pre pandemic. Facebook twenty one gazillion, it's
Speaker 2: a double forty three gazillion, up to forty eight gazillion,
Speaker 2: man deep saying excuse me, entered run And when do
Speaker 2: they get too big?
Speaker 7: See, I would say for a software company, something between
Speaker 7: forty five and fifty percent is you know, achievable. You know,
Speaker 7: I remember covering Visa and MasterCard about you know, fifteen years,
Speaker 7: twenty years ago. Right now their margins are fifty five
Speaker 7: percent and somewhere in that range. So operating margins for
Speaker 7: software companies, you know, probably peak around fifty percent, and
Speaker 7: we only have a handful of companies right around that
Speaker 7: mask Adobe somewhere closer, and Microsoft is going to get
Speaker 7: there between forty five and fifty.
Speaker 2: Good morning, Meredith Whitney. Did you see Visa's earnings? Now? Yeah,
Speaker 2: I mean, I mean it's just like it's like there's
Speaker 2: a pretty people.
Speaker 5: Are spending like paper are spending, like say an Rak,
Speaker 5: as we head into this tech earning season here, how
Speaker 5: much are we going to hear about AI? Is it
Speaker 5: gonna be every other word, every third word? Where are
Speaker 5: we in kind of the development the evolution of AI?
Speaker 5: I know you and man Deep and your teams have
Speaker 5: done a lot of research on this, I.
Speaker 7: Would say, very early innings, and you know we I
Speaker 7: think this is not going to change at least for
Speaker 7: the next few years when we see more and more
Speaker 7: product development from all these companies, you know right now
Speaker 7: buying Microsoft. None of the big software companies have been
Speaker 7: able to monetize it in a proper way. And I
Speaker 7: think the next year we're going to see more monetization,
Speaker 7: but more new products coming out, because right now we
Speaker 7: are seeing the bulk of the investments going into you know,
Speaker 7: the hardware and the infrastructure piece of it.
Speaker 2: I just my head is spinning over where we are
Speaker 2: versus like nifty to fifty. What's like you mentioned ken
Speaker 2: Olsen and Decker earlier. I mean, this is Mandy. This
Speaker 2: is totally different than nineteen ninety eight, nineteen ninety nine.
Speaker 2: I mean there was a lot of nonprofit going on.
Speaker 2: All these people are is it basically on a ninety
Speaker 2: day basis, they're minting money and we have the distraction
Speaker 2: of what Tim and Carroll do at four pm.
Speaker 3: And they have the deep pockets to invest. So the
Speaker 3: one big difference here is all these companies that are
Speaker 3: investing in Capex, they can afford to do that and
Speaker 3: without a big hit to their margin. So clearly, I
Speaker 3: think the fact that they have the data and the
Speaker 3: Capex wherewithal that's what drives these Okay.
Speaker 2: I got ten seconds. I'm so sorry. Are we going
Speaker 2: to hear share buyback announcements? Yeah, you gotta be kidding.
Speaker 3: Meta announce a dividend that was symbolic even though less
Speaker 3: than one percent dividend yield. But clearly Google is on
Speaker 3: the words of doing something similar. The street is expecting,
Speaker 3: so waiting to hear.
Speaker 2: Let's just want to do this again and around in
Speaker 2: Chicago they keep seeing with their studios on Apple, card play,
Speaker 2: on YouTube. It is the front pages. My people said,
Speaker 2: Lisa was wound up today, Lisa, how do you start
Speaker 2: tired up?
Speaker 6: Okay, so walking around New York City streets, what do
Speaker 6: you see everywhere? Scaffolding? It's everywhere. See this is it's
Speaker 6: a hot button issue. Okay, did you know there are
Speaker 6: more than eighty five hundred scaffoldings around your city streets?
Speaker 6: If you were to stretch them out, it would go
Speaker 6: from Manhattan to Montreal. That's how much we have. That's
Speaker 6: what they're saying. Okay, this is the New York Times.
Speaker 3: Now.
Speaker 6: They're supposed to be temporary, right, But here's the problem.
Speaker 6: There's nearly one thousand that have been in place for
Speaker 6: more than three years, so they're sticking around. There's a
Speaker 6: lot of regulations around, and city officials want to do
Speaker 6: something about it.
Speaker 2: You want to change it the whole place. There's parts
Speaker 2: of midtown Folks, it's like plus Vendome in Paris without
Speaker 2: the charm. I mean, it's like miles of scaffold.
Speaker 5: And it's I think you just got to go around
Speaker 5: and just take it.
Speaker 2: I mean, Lisa, what are they going to do? What
Speaker 2: you're reporting? What are they going to do?
Speaker 6: So they're going through they want to put all these
Speaker 6: these reforms down. So they want to reduce how many
Speaker 6: there can be, how long they can be up. They
Speaker 6: want to increase the fines, That's what they think they're
Speaker 6: going to do so they can strengthen the enforcement of it.
Speaker 6: So they think that if they increase these fines, hit
Speaker 6: hard on enforcement, it's gonna take some of the down.
Speaker 2: I don't easy one.
Speaker 5: If I were a politician, this would be an easy win.
Speaker 2: Ye to go out and you have to have them
Speaker 2: up for safety. I get everybody, I've got a friend
Speaker 2: and you know I get it. But if it's been
Speaker 2: up for three years and nothing's, nothing's going on, take
Speaker 2: it down today exactly? That's the problem. All right?
Speaker 4: What else we have?
Speaker 2: All right?
Speaker 6: Airlines, this is a good one for travelers. They now
Speaker 6: have to pay automatic refunds for things like canceled flights.
Speaker 6: This is new from the US Department of Transportation. Came
Speaker 6: out today, so they have to provide these automatic refunds.
Speaker 6: This is too from within the US. If their flights
Speaker 6: are canceled or even if they're altered, significantly altered, there
Speaker 6: are certain restrictions for that too. But the goal is
Speaker 6: just to make it easier for to get people to
Speaker 6: get their money back, to make those refund policies more
Speaker 6: consistent from one airline to the next, because it differs
Speaker 6: as you go from airline to airline. Travelers will also
Speaker 6: get refunds for checked bag fees if the bag is
Speaker 6: lost and also if it's not delivered within twelve hours
Speaker 6: of domestic flights. So there's another bonus there, and you're
Speaker 6: going to get it right away. It's automatic refunds. So
Speaker 6: however you paid, whether credit card or even cash, then
Speaker 6: that's all.
Speaker 5: So I don't have to stand in line with like
Speaker 5: five thousand other people that could customer service in Newark
Speaker 5: for United.
Speaker 6: It's okay, it's gonna be Yeah, you should.
Speaker 4: You should.
Speaker 5: I just eat it. I'm like, all right, my flight's canceled.
Speaker 5: I'm going on.
Speaker 6: Okayo's you can get your money back.
Speaker 2: We do an audible here, Yes, did I hear yesterday?
Speaker 2: Terminal A Newark.
Speaker 5: Yeah, Michael Barber has had that news story. We won
Speaker 5: some award or they won some award for like greatest
Speaker 5: terminal now it is.
Speaker 6: It's awesome.
Speaker 2: It is great.
Speaker 5: And the best thing about the new Terminal A is
Speaker 5: when you get off your flight and you need to
Speaker 5: get your uber, it's a very organized, easy way to access,
Speaker 5: unlike Terminal.
Speaker 2: C, which is a RAM.
Speaker 6: Sometimes it was a little so anyway, they did a
Speaker 6: good job.
Speaker 5: Terminal B is now undergoing the Simmer type of construction renovation.
Speaker 2: So getting there. We're getting there. We're just you know
Speaker 2: the negativity about this. We're getting there. If they just
Speaker 2: fix the potholes on fifty eighth Street next.
Speaker 6: That's going to take an eternity American Airlines. Do either
Speaker 6: of you have the advantage the loyalty points for American.
Speaker 5: Air American guy, I'm not a DFW person.
Speaker 6: Well, they're they're changing how flyers can earn rewards again
Speaker 6: because they've done it before, a lot of airlines are
Speaker 6: changing it. Here's the difference. Okay, So starting in July,
Speaker 6: travelers will only receive loyalty points advantage miles for airfare
Speaker 6: if they booked directly with American or one of its
Speaker 6: partners or a preferred travel agency. That's the only we
Speaker 6: can do it. The co branded credit cards that's not
Speaker 6: going to be affected. That can get you your miles.
Speaker 6: But it just shows how they're continuing to change to
Speaker 6: try and get in some new customers, get new people
Speaker 6: hooked on American, Paul.
Speaker 2: Don't you think from a securities analysis standpoint, it's just
Speaker 2: a tough business. It really is.
Speaker 5: I mean, I think and I'm so surprised that you
Speaker 5: see these folks and they make money in one business
Speaker 5: and they say I'm going to go start an airline.
Speaker 2: You know, like, why would you want to get in?
Speaker 2: American Airlines ten year track record, Microsoft twenty eight percent
Speaker 2: per year, Disney tanking five percent per year, American Airlines
Speaker 2: negative seven percent per year. Again off the pandemic.
Speaker 5: Yes, I mean it's it's a tough margin. I mean
Speaker 5: it's got it's a low margin business and you've got
Speaker 5: fuel costs you have to deal.
Speaker 2: You got people like Lisa arguing with you.
Speaker 4: Exactly got their point the.
Speaker 2: Last the last time we did a lot of off flight.
Speaker 2: I just stand in the lounge going out and I
Speaker 2: just stand in the lounge coming back. That's how messed up.
Speaker 6: The lounge is packed.
Speaker 2: Literally there were no seats.
Speaker 6: I don't get in the lounge. Where am I missing out?
Speaker 5: Well, you can use your points to get into the
Speaker 5: into you know what. The lounges are very big in Europe.
Speaker 5: That's like the thing. Everybody's in the lounge and Europe.
Speaker 5: I never go to the lounges here in the US.
Speaker 5: I mean, I don't know.
Speaker 2: I can report United opened the Lovely Lounge. Finally the
Speaker 2: gull Okay, they opened a lovely lounge.
Speaker 6: Did you have a seat there?
Speaker 2: I had a seat there?
Speaker 6: You go?
Speaker 5: It was next you get when you get tripled, you know,
Speaker 5: first class, you get a seat.
Speaker 6: You get a seat. Tom, I saw this one. I
Speaker 6: thought of your right away. Will there be a Showgun
Speaker 6: season two? This is the question Business insider. Okay, so
Speaker 6: you know it streamed on Hulu. Is that how you
Speaker 6: watch it on Hulu?
Speaker 2: I think so.
Speaker 6: So here's the thing the creators are telling the Hollywood Reporter.
Speaker 6: The show was made so long ago because a lengthy production.
Speaker 6: It took a long time. It was like a five
Speaker 6: year journey just to make that first season. So if
Speaker 6: they were to be shooting a second season, they would
Speaker 6: already have to be shooting already. But they're saying, since
Speaker 6: it took so long, there already got that pre production
Speaker 6: work out of the bag. So now it'll be a
Speaker 6: little bit faster if they were to do a season two.
Speaker 2: Look at their.
Speaker 6: Viewers want it. They're asking for it. The Showgun it
Speaker 6: was a self contained novel, but there were a series
Speaker 6: of novels too, so it could kind.
Speaker 2: Of bring Mister Clove gave them their sequel. He wrote
Speaker 2: four or five books and Taipan is after Shogun in
Speaker 2: it's nineteenth century, eighteen forty eighteen fifty Hong Kong, and
Speaker 2: you could even have some of the same characters doing,
Speaker 2: you know, and it could show up again any time.
Speaker 2: But Clovel gave them the sequel to the Pacific Rim,
Speaker 2: in this case Hong Kong from Japan. But it'll be
Speaker 2: interesting to see which I haven't seen the last episode.
Speaker 6: You haven't seen the last No, I haven't seen the list.
Speaker 2: I'm waiting for missus Kane to arrive. I'll see it. Actually,
Speaker 2: I've read the book twice, so.
Speaker 6: I think, oh, no, you know, if.
Speaker 2: You haven't read the book, I highly recommend for those
Speaker 2: that have seen Shogun. It is a rewarding twelve hundred pages.
Speaker 2: It is what Clavel did. And I should point out
Speaker 2: also King Rat of the Singapore where the Singapore Airport is.
Speaker 2: They bulldoze the prisoner of war camp from World War
Speaker 2: Two and King Rat is his shortest in his best
Speaker 2: book it is. I can't say enough about the intensity.
Speaker 2: I read it when I was like fifteen, and you
Speaker 2: know I was your room for Lisa Matteo. Thank you
Speaker 2: so much for the newspapers. This is the Bloomberg Surveillance Podcast,
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