WEBVTT - Netflix Weighs Amending Warner Bros. Bid to Make It All Cash 

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<v Speaker 2>Through Netflix shares are down about twenty five percent since

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<v Speaker 2>they began pursuing Warner Brothers in October. So is Netflix

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<v Speaker 2>in a race against time here?

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<v Speaker 3>I think so, Scarlett. I mean, you know, there has

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<v Speaker 3>obviously been a lot of worries about that falling stock

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<v Speaker 3>price and investors kind of questioning, Okay, so really what

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<v Speaker 3>is the value right if that's an eighty five fifteen

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<v Speaker 3>split for Warner Studio and streaming assets. I mean, Warner

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<v Speaker 3>shareholders obviously worried about the falling value of you know,

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<v Speaker 3>the Netflix stock, and so obviously Netflix, you're really trying

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<v Speaker 3>to estivate those investors by making it an all cash offer.

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<v Speaker 3>But yes, they are, you know, very much running against

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<v Speaker 3>the clock. There is the January twenty first deadline from

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<v Speaker 3>a rival, Paramount Skidance for tendering shares at thirty dollars

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<v Speaker 3>for all of Warner Brothers, Discovery, so there are multiple

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<v Speaker 3>things going on here, but this definitely should spark some

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<v Speaker 3>sort of response we think from Paramount Gita.

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<v Speaker 4>It feels like we're getting one escalation after the other

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<v Speaker 4>in the bidding war. Do you think that proposing an

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<v Speaker 4>all cash offer could actually exped expedite the closing of

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<v Speaker 4>this deal by Netflix or do you expect that Paramount

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<v Speaker 4>will fight back again.

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<v Speaker 3>We definitely think that Paramount will fight back because for them,

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<v Speaker 3>the cost of not doing the deal is definitely greater

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<v Speaker 3>than it is for Netflix. Paramount is in a very

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<v Speaker 3>dire situation. They need these assets very, very badly. Not

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<v Speaker 3>the case for Netflix, which has a really strong, you know,

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<v Speaker 3>financial profile, has a really strong content library. This is

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<v Speaker 3>really more of a nice to have rather than a

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<v Speaker 3>must have. So expect expect something from Paramount Skydance. We

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<v Speaker 3>don't expect them to go away quietly.

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<v Speaker 2>We don't expect them to go away quietly. But there's

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<v Speaker 2>a real question mark here because Paramount Skidance's bid for

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<v Speaker 2>Warner Brothers Discovery assumes that the value of the legacy

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<v Speaker 2>cable channels is zero, and of course it's bid covers

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<v Speaker 2>the entire company, whereas Netflix is only looking for the

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<v Speaker 2>streaming and the studio business. Yet what does that say

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<v Speaker 2>about Paramount Skuydiance's own legacy cable business zero? I mean,

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<v Speaker 2>does that mean that its business is also worth something

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<v Speaker 2>similar to zero?

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<v Speaker 3>I mean, that's just such a brilliant point that you raise,

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<v Speaker 3>Scarlett absolutely. I mean, when they, you know, basically devalue

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<v Speaker 3>the Warner Brothers assets, they risk doing the same for

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<v Speaker 3>their own cable networks. But there is, you know, there's

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<v Speaker 3>absolutely no way to sugar coat the fact that the

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<v Speaker 3>cable network business is a declining business. What Paramount is

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<v Speaker 3>doing to its you know, kind of favoring its argument

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<v Speaker 3>is basically using the poor stock performance of Versut, which

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<v Speaker 3>is the cable network group from or the cable network

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<v Speaker 3>spin off from Comcast. Its poor performance is kind of

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<v Speaker 3>the reason their justification for why the Warner Brothers legacy

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<v Speaker 3>networks should not really be worth much. But I still think,

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<v Speaker 3>you know, obviously they're still Yes, there is cord cutting,

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<v Speaker 3>Yes advertising is under pressure, but they are still cashcows.

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<v Speaker 3>They still do throw out a good amount of cash.

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<v Speaker 3>And that is true both for Warner Brothers as well

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<v Speaker 3>as for Paramount. And obviously Paramount still sees a lot

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<v Speaker 3>of you know, rationale and kind of combining those two

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<v Speaker 3>portfolios Paramounts own cable networks along with warners to kind

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<v Speaker 3>of just stem that whole melting ice cube argument that said, yeah,

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<v Speaker 3>it's it's this, This is really turning out to be,

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<v Speaker 3>you know, very very interesting. I think Warner Brothers still

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<v Speaker 3>kind of sees a lot of value in its networks.

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<v Speaker 3>They do want, you know, that the separation. They think

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<v Speaker 3>they can extract a lot more value with the separation

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<v Speaker 3>of their global networks business, which is supposed to happen

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<v Speaker 3>by the third quarter of this year. So again it's

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<v Speaker 3>still a wait and watch, but I think at this point, Scarlett,

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<v Speaker 3>the ball is definitely in Paramounts court.

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<v Speaker 4>Githa not too long ago, Bank of America said that

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<v Speaker 4>this bidding war is reshaping the broader media industry. What

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<v Speaker 4>are the consequences of it for the broader media industry,

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<v Speaker 4>do you think, and what kind of precedent does it

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<v Speaker 4>set for future media company acquisitions?

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<v Speaker 3>Yeah, absolutely, Alex. I think one of the things one

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<v Speaker 3>of our key takeaways from this whole exercise is that,

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<v Speaker 3>you know, obviously, linear networks are in a really precarious position,

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<v Speaker 3>no doubt about that. But then the studio assets as

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<v Speaker 3>well as the streaming platforms, the content generation part of it,

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<v Speaker 3>there's still quite a lot of value in those. So

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<v Speaker 3>any of you know, the studios that you see out there,

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<v Speaker 3>whether it's Alliance Gate or you know, maybe even an

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<v Speaker 3>AMC Networks which has a television production studio, maybe all

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<v Speaker 3>of that still has some value. But I think really

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<v Speaker 3>the biggest question for us, and I think for media

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<v Speaker 3>investors at large, is what happens with Comcast and what

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<v Speaker 3>happens with its NBC media group that really is somewhat of,

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<v Speaker 3>you know, this hidden jewel. I would say they have

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<v Speaker 3>to extract value for that. They probably have to spin

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<v Speaker 3>off that asset. So I think everybody is really super

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<v Speaker 3>focused on what they do next.

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<v Speaker 2>Okay, so in terms of what happens next, we are

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<v Speaker 2>waiting to see if Netflix actually does revise the term

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<v Speaker 2>of its offer to something that's all cash. And then

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<v Speaker 2>on the paramount skidance side, you said the deadline is

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<v Speaker 2>coming up for the tender offer.

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<v Speaker 5>When is that exactly?

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<v Speaker 3>Jan twenty first?

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<v Speaker 2>Jan twenty first, So next Wednesday we'll get a sense

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<v Speaker 2>of whether shareholders are in favor of it, and what

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<v Speaker 2>do we think is the reception right now.

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<v Speaker 3>Very very poor. The last we heard, only about two

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<v Speaker 3>percent of outstanding shares had been tendered, so really a

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<v Speaker 3>shareholder is still kind of holding out for that sweetened offer.

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<v Speaker 1>Stay with us.

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<v Speaker 2>More from Bloomberg Intelligence coming up after this.

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<v Speaker 1>You're listening to the Bloomberg Intelligence podcast. Catch us live

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<v Speaker 1>weekdays at ten am Eastern on Apple, cocklay and Android

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<v Speaker 1>Auto with the Bloomberg Business App. Listen on demand wherever

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<v Speaker 2>Some big news out of Big Tech this week when

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<v Speaker 2>it comes to jobs as well, Yeah, layoffs from meta platforms.

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<v Speaker 4>It is beginning to cut more than a thousand jobs

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<v Speaker 4>from the company's Reality Labs division, part of its plan

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<v Speaker 4>to redirect resources from virtual reality and metaverse products, which

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<v Speaker 4>is really really interesting given the facts that it invested

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<v Speaker 4>so much into this endeavor, even change its name accordingly,

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<v Speaker 4>and we have with us Man Deep Saying, Global Tech

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<v Speaker 4>Research head of Bloomberg Intelligence, to discuss this. Man Deep,

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<v Speaker 4>what does this all mean for Meta's bottom line? What

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<v Speaker 4>do these jobs job cuts?

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<v Speaker 3>Do?

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<v Speaker 5>I mean Reality lab segment is almost losing twenty billion

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<v Speaker 5>dollars a year and cumulatively they've lost about seventy billion

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<v Speaker 5>dollars over the past three years, so a lot of

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<v Speaker 5>investors questioned, you know, how long they were expected to

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<v Speaker 5>remain patient on those kind of losses. And I think

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<v Speaker 5>the initial rumors were about a thirty percent cut in

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<v Speaker 5>that unit. So this is somewhat build expectations in terms

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<v Speaker 5>of ten percent job cut, but it just goes to

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<v Speaker 5>show that right now, the companies obviously focus more on

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<v Speaker 5>the AI side in terms of building the infrastructure, building

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<v Speaker 5>their own large angrid model, and it may take a

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<v Speaker 5>while to you know, really bring it, bring that LLLM

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<v Speaker 5>concept in that variables or the whether it's a VR

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<v Speaker 5>headsets or the glasses. And I mean when you compare

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<v Speaker 5>VR headsets or the glasses that they're selling to let's

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<v Speaker 5>say air pods, the number of units pale in comparison.

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<v Speaker 5>We're talking, you know, ten million, maybe if they do

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<v Speaker 5>twenty million. Apple does more than one hundred million AirPods

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<v Speaker 5>a year, So what's the opportunity here? And I think

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<v Speaker 5>that's where you probably will see more cuts in that business.

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<v Speaker 2>That is a really really important contrast to make their

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<v Speaker 2>in terms of what Meta is trying to do, because

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<v Speaker 2>they want to be a part of the mass market here,

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<v Speaker 2>but it's not quite there yet. Mindy, As Meta pivots

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<v Speaker 2>away from VR in the metaverse to AI, what does

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<v Speaker 2>that mean for spending? I mean, they obviously had to

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<v Speaker 2>spend a lot to build out the metaverse, to build

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<v Speaker 2>out their VR offerings, and now they're going to shift

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<v Speaker 2>everything to building out the AI offerings, large language models,

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<v Speaker 2>these AI glasses. What do you think that the pace

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<v Speaker 2>of spending would just kind of continue, It won't really

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<v Speaker 2>shift all that much.

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<v Speaker 5>Yes, On the AI side, the opportunity is huge. What

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<v Speaker 5>everyone is chasing right now is an AI agent that

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<v Speaker 5>can book your travel, your Uber trip, order food, you know,

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<v Speaker 5>do shopping for you. That's the vision Google is chasing.

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<v Speaker 5>That's what Amazon alexaplus launch was all about. So Meta

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<v Speaker 5>has that surface area with you know, Instagram and WhatsApp,

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<v Speaker 5>and you could argue they could in theory develop such

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<v Speaker 5>an agent, but the hard part is integration and getting

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<v Speaker 5>the AI to where it's you know, reliable and pretty.

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<v Speaker 5>And that's where I mean, it's anybody's guests who is

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<v Speaker 5>best positioned. I think that Apple Google partnership that we

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<v Speaker 5>saw this week is probably a negative for Meta in

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<v Speaker 5>this sense. Like, if Apple is setting up defaults in

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<v Speaker 5>their phone, then that makes it hard for an external

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<v Speaker 5>kind of agent to do these kind of things. So

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<v Speaker 5>from that perspective, distribution really matters and operating system control

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<v Speaker 5>really matters. So Meta is somewhat at a disadvantage when

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<v Speaker 5>it comes to, you know, their distribution on Apple and

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<v Speaker 5>Android devices.

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<v Speaker 4>Mandy. We also got news today that Airbnb hired Meta's

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<v Speaker 4>head of General AI, which is really interesting because wasn't

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<v Speaker 4>it not too long ago that they declined to work

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<v Speaker 4>with open AI. What does this all mean for its

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<v Speaker 4>artificial intelligence endeavors.

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<v Speaker 5>Yeah, I think Brian Chesky has been quite vocal about

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<v Speaker 5>using open source llms as opposed to you know, proprietary

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<v Speaker 5>llms like open AI and Gemini, and so his thing is,

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<v Speaker 5>I've got a direct customer traffic coming to my website.

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<v Speaker 5>If I give away you know, my bookings interface to

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<v Speaker 5>these llms, then I'm losing that customer direct customer touch,

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<v Speaker 5>and he doesn't want to do that. He instead wants

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<v Speaker 5>to build his own LM based on an open source

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<v Speaker 5>model that's already out there, and that's where you know,

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<v Speaker 5>Meta has open source their model in the past, so

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<v Speaker 5>it makes sense to have somebody from Meta come in

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<v Speaker 5>and do something along those lines. ABNP has been open

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<v Speaker 5>to using Chinese open source models and building on top

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<v Speaker 5>of that. So from that perspective, it's an interesting strategy

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<v Speaker 5>that they are going ahead with in terms of using

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<v Speaker 5>all kinds of open source and not just you know,

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<v Speaker 5>the US based model.

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<v Speaker 2>Who in the tech world is winning the talent war

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<v Speaker 2>because it felt like for a long time open AI

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<v Speaker 2>and traffic they were, you know, picking up a lot

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<v Speaker 2>of talent.

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<v Speaker 4>Is that still the case?

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<v Speaker 5>I mean right now, the talent is going to where

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<v Speaker 5>the compute is. If you don't have the compute, you

0:11:06.679 --> 0:11:10.000
<v Speaker 5>just cannot attract the talent because these models need a

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<v Speaker 5>lot of compute for training. And you may be the

0:11:13.240 --> 0:11:15.800
<v Speaker 5>smartest person, but if you don't have the computer, you

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<v Speaker 5>can't test your idea. So from that perspective, infrastructure bill

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<v Speaker 5>really matters, which is why in Nvidia, even though they

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<v Speaker 5>are the chip provider, now they launch their own foundational

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<v Speaker 5>model in autos self driving that just goes to show

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<v Speaker 5>what compute can do, you know, and Vidia is definitely

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<v Speaker 5>moving up the stax. It will be interesting to see

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<v Speaker 5>how many areas where they compete in with their own foundational.

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<v Speaker 4>Model man Deep. We're early into the earning season, but

0:11:42.200 --> 0:11:44.440
<v Speaker 4>big tech results will be here before we know it.

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<v Speaker 4>And obviously the bar is really high when it comes

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<v Speaker 4>to what these companies are saying about how they're monetizing

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<v Speaker 4>their heavy AI in investments. Do you think that they'll

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<v Speaker 4>live up to the expectations.

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<v Speaker 5>I think right now you have to focus on where

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<v Speaker 5>you will see positive earnings revisions, and given the KAPEX

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<v Speaker 5>investments are going up for this year, it's going to

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<v Speaker 5>be hard to show, you know, positive revisions when it

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<v Speaker 5>comes to earnings, except for someone like Alphabet that really

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<v Speaker 5>has seen a big shift in sentiment because everyone realizes

0:12:17.960 --> 0:12:20.200
<v Speaker 5>that their models have caught up, and they also are

0:12:20.240 --> 0:12:22.760
<v Speaker 5>the most efficient when it comes to their stack, the

0:12:22.880 --> 0:12:26.920
<v Speaker 5>use of TPUs and low cost inferencing. So from that perspective,

0:12:27.200 --> 0:12:31.280
<v Speaker 5>I think Alphabet clearly is best position to deliver positive surprises.

0:12:31.640 --> 0:12:34.200
<v Speaker 5>But for someone like Meta, I mean, if you're hearing

0:12:34.280 --> 0:12:37.079
<v Speaker 5>job cuts, then you know probably it's going to be

0:12:37.120 --> 0:12:39.760
<v Speaker 5>hard for them to you know, show positive revisions this year.

0:12:40.320 --> 0:12:44.040
<v Speaker 2>And I feel like the counterpoint to an Alphabet a

0:12:44.120 --> 0:12:48.480
<v Speaker 2>Google that's doing really well is Oracle. We've seen it

0:12:48.559 --> 0:12:52.320
<v Speaker 2>really fall from grace of it, and I wonder how

0:12:52.360 --> 0:12:55.520
<v Speaker 2>critical investors are going to be when they hear from

0:12:55.559 --> 0:12:56.840
<v Speaker 2>the company this earning season.

0:12:57.120 --> 0:13:00.160
<v Speaker 5>Well, they will have to give foof points of the

0:13:00.200 --> 0:13:04.000
<v Speaker 5>build out, the open AI backlock that they have and

0:13:04.080 --> 0:13:07.080
<v Speaker 5>how that translates into revenue. Because the good thing is

0:13:07.559 --> 0:13:12.000
<v Speaker 5>market is skeptical of, you know, really far out revenue streams,

0:13:12.040 --> 0:13:14.560
<v Speaker 5>and so from that perspective, this is quite healthy that

0:13:14.720 --> 0:13:18.160
<v Speaker 5>you know, there was a correction in Oracle even though

0:13:18.160 --> 0:13:20.560
<v Speaker 5>they have given a four or five year revenue guide

0:13:20.800 --> 0:13:23.520
<v Speaker 5>and they have the backlock, market doesn't believe it. The

0:13:23.600 --> 0:13:25.480
<v Speaker 5>market wants to see more proof points. So I think

0:13:25.559 --> 0:13:27.480
<v Speaker 5>that's what companies will have to do when it comes

0:13:27.480 --> 0:13:31.640
<v Speaker 5>to open AI monetization and ROI. They'll have to start

0:13:31.640 --> 0:13:33.200
<v Speaker 5>showing more tangible proof points.

0:13:33.880 --> 0:13:36.800
<v Speaker 2>Stay with us more from Bloomberg Intelligence coming up after this.

0:13:40.559 --> 0:13:44.240
<v Speaker 1>You're listening to the Bloomberg Intelligence podcast. Catch us live

0:13:44.320 --> 0:13:47.400
<v Speaker 1>weekdays at ten am Eastern on Apple Corplay and Android

0:13:47.400 --> 0:13:50.720
<v Speaker 1>Auto with the Bloomberg Business App. Listen on demand wherever

0:13:50.760 --> 0:13:53.920
<v Speaker 1>you get your podcasts, or watch us live on YouTube.

0:13:54.559 --> 0:13:56.640
<v Speaker 2>We are talking about the big take that Bloomberg has

0:13:56.679 --> 0:14:00.760
<v Speaker 2>published today, and it's called the CEO playbook to navigate Trump.

0:14:00.880 --> 0:14:04.800
<v Speaker 2>This is kind of the question of the president's second,

0:14:05.920 --> 0:14:09.040
<v Speaker 2>second four year term. How do you manage this president?

0:14:09.080 --> 0:14:12.520
<v Speaker 2>And the answers with difficulty because the rules kind of

0:14:12.559 --> 0:14:15.120
<v Speaker 2>keep changing. Matt Boyle is one of the co authors

0:14:15.160 --> 0:14:17.280
<v Speaker 2>of this story, and Matt joins us now in studio.

0:14:17.480 --> 0:14:20.320
<v Speaker 2>Great story, Matt, and it was something that you had

0:14:20.400 --> 0:14:24.000
<v Speaker 2>trouble reporting on insofar as a lot of people wouldn't.

0:14:23.680 --> 0:14:26.800
<v Speaker 6>Talk to you exactly. I mean, the usual sort of

0:14:26.960 --> 0:14:31.000
<v Speaker 6>voices of Corporate America, the Chamber of Commerce, the Business Roundtable,

0:14:31.080 --> 0:14:32.920
<v Speaker 6>We're just like, you know, we're going to take a

0:14:33.000 --> 0:14:36.040
<v Speaker 6>pass on this one, and just about every CEO under

0:14:36.040 --> 0:14:38.440
<v Speaker 6>the sun, you know, just they just don't want to

0:14:38.480 --> 0:14:40.880
<v Speaker 6>go there. It's like the third rail. So it was

0:14:41.000 --> 0:14:43.560
<v Speaker 6>challenging to report. But we had a lot of great conversations,

0:14:43.600 --> 0:14:47.240
<v Speaker 6>let's say, on background, with those who are advising CEOs,

0:14:47.320 --> 0:14:50.040
<v Speaker 6>and that led to our playbook. Here the five Rules

0:14:50.040 --> 0:14:52.120
<v Speaker 6>for dealing with the Trump Madness.

0:14:52.680 --> 0:14:55.360
<v Speaker 4>Matt. We've seen a growing number of business leaders recently

0:14:55.480 --> 0:14:57.640
<v Speaker 4>kind of push back more than usual on some of

0:14:57.680 --> 0:15:01.400
<v Speaker 4>President Trump's policy proposals. We had City CFO this morning

0:15:01.440 --> 0:15:04.000
<v Speaker 4>pushing back on the credit card cap, x On Mobile

0:15:04.080 --> 0:15:07.520
<v Speaker 4>CEO calling Venezuela an investable? Is this unusual in what

0:15:07.600 --> 0:15:09.720
<v Speaker 4>might be the consequences for them?

0:15:09.920 --> 0:15:12.160
<v Speaker 6>Yeah, it takes a certain CEO to push back. It

0:15:12.200 --> 0:15:14.480
<v Speaker 6>takes a Jamie Diamond or the CEO of ex On

0:15:14.560 --> 0:15:17.040
<v Speaker 6>Mobile who have the clout and the authority and the

0:15:17.040 --> 0:15:20.440
<v Speaker 6>industry backing to say no. You know, this is actually

0:15:20.480 --> 0:15:23.000
<v Speaker 6>not perhaps a good idea. But most of the time,

0:15:23.040 --> 0:15:26.240
<v Speaker 6>as we saw with tariffs, it was happening behind the scenes.

0:15:26.600 --> 0:15:29.200
<v Speaker 6>You know, remember this is going back aways. But when

0:15:29.320 --> 0:15:33.200
<v Speaker 6>Trump told the Walmart CEO, Doug McMillan to eat the tariffs,

0:15:34.040 --> 0:15:36.640
<v Speaker 6>Walmart said nothing, and that was probably pretty wise. There

0:15:36.720 --> 0:15:38.600
<v Speaker 6>was no reason to get into a public spat on

0:15:38.640 --> 0:15:42.720
<v Speaker 6>true social with Trump. So but now maybe it's because

0:15:42.720 --> 0:15:45.440
<v Speaker 6>Trump is in a different position twelve months later, or

0:15:45.480 --> 0:15:48.640
<v Speaker 6>it's the issues involved. You know, banking CEOs are very

0:15:48.680 --> 0:15:52.120
<v Speaker 6>happy to go out against interest ratecaps, but we are

0:15:52.200 --> 0:15:54.680
<v Speaker 6>seeing in certain cases some CEOs pushed back.

0:15:54.760 --> 0:15:57.960
<v Speaker 2>Yes, and direct engagement does seem to pay off. If

0:15:58.000 --> 0:16:01.320
<v Speaker 2>you can find your way to the President and mobile phone,

0:16:01.320 --> 0:16:04.240
<v Speaker 2>which apparently he pans out the number pretty willingly to

0:16:04.560 --> 0:16:08.600
<v Speaker 2>certain top CEOs. You talk about in videos Jensen Huang

0:16:08.960 --> 0:16:13.080
<v Speaker 2>having a direct line to the President, also Lipboon Tam

0:16:13.200 --> 0:16:15.160
<v Speaker 2>of Intel being able to do that as well.

0:16:15.280 --> 0:16:18.160
<v Speaker 6>Exactly. I mean Jensen in video CEO one on Joe

0:16:18.240 --> 0:16:22.400
<v Speaker 6>Rogan in December and said, you know, Trump is extraordinarily accessible.

0:16:22.440 --> 0:16:25.040
<v Speaker 6>The United Airline CEO said the same thing to us.

0:16:25.120 --> 0:16:27.560
<v Speaker 6>I mean, you can call this man up. He does

0:16:27.640 --> 0:16:29.840
<v Speaker 6>answer his cell phone, as we've seen. Sometimes at four

0:16:29.960 --> 0:16:32.320
<v Speaker 6>thirty in the morning, he will pick up his cell phone.

0:16:32.360 --> 0:16:35.720
<v Speaker 6>But not everybody has Trump on speed dials. So a

0:16:35.800 --> 0:16:37.680
<v Speaker 6>point of our story was that you have to find

0:16:37.720 --> 0:16:40.400
<v Speaker 6>a way in, whether that's Susie Wiles, the chief of Staff,

0:16:40.880 --> 0:16:44.440
<v Speaker 6>whether it's Scott Besson Treasury or Commerce, Howard Lutnick, or

0:16:44.520 --> 0:16:46.960
<v Speaker 6>one of the sort of lower level aids. Also, I

0:16:46.960 --> 0:16:49.280
<v Speaker 6>mean we found that, you know, the director of the

0:16:49.280 --> 0:16:52.600
<v Speaker 6>White House Office of Public Liaison is somebody you can

0:16:52.760 --> 0:16:54.880
<v Speaker 6>you can go to also, So the point is to

0:16:54.880 --> 0:16:56.880
<v Speaker 6>find a way in, no matter how you do it.

0:16:57.280 --> 0:16:59.560
<v Speaker 4>Matt, what are some of the differences in how President

0:16:59.600 --> 0:17:02.280
<v Speaker 4>and Trump deals with business leaders in his second term

0:17:02.320 --> 0:17:03.280
<v Speaker 4>from his first term.

0:17:03.600 --> 0:17:07.000
<v Speaker 6>Well, the second term he's a little bit more unshackled.

0:17:07.119 --> 0:17:09.320
<v Speaker 6>Let's say in the first term, you had a few

0:17:09.359 --> 0:17:13.040
<v Speaker 6>more traditional Republican voices, you know, you had Rex Tillerson

0:17:13.440 --> 0:17:16.600
<v Speaker 6>in there and other folks who you know, were able

0:17:16.640 --> 0:17:19.399
<v Speaker 6>to maybe play little defense. They were able to slow

0:17:19.520 --> 0:17:24.400
<v Speaker 6>walk some of Trump's more outrageous policy proposals. Now it's

0:17:24.440 --> 0:17:29.040
<v Speaker 6>just all true believers. So he's sort of unfettered, he's unshackled,

0:17:29.200 --> 0:17:31.960
<v Speaker 6>and there's really not many checks. So what this means

0:17:31.960 --> 0:17:34.399
<v Speaker 6>for CEOs is, yeah, they really can't hide. They can't

0:17:34.440 --> 0:17:37.040
<v Speaker 6>just say well, we'll let our industry association take care

0:17:37.080 --> 0:17:39.080
<v Speaker 6>of this or don't worry. I mean, look at just

0:17:39.119 --> 0:17:42.320
<v Speaker 6>the past week what's been going on. CEOs really need

0:17:42.400 --> 0:17:43.080
<v Speaker 6>to be on watch.

0:17:43.280 --> 0:17:46.680
<v Speaker 4>Yeah, shackles is a fantastic word, a free range Trump right,

0:17:46.800 --> 0:17:47.879
<v Speaker 4>there we go, There we go.

0:17:48.280 --> 0:17:50.200
<v Speaker 2>The other thing that you could do, if you're trying

0:17:50.200 --> 0:17:52.400
<v Speaker 2>to get his attention or curry favor, is to give

0:17:52.520 --> 0:17:53.679
<v Speaker 2>him a made up award.

0:17:54.119 --> 0:17:59.200
<v Speaker 6>Yes, he does respond to these types of trinkets and trophies,

0:17:59.400 --> 0:18:02.280
<v Speaker 6>as we've seen of the Apple CEO, Tim Cook was

0:18:02.280 --> 0:18:04.520
<v Speaker 6>able to give him this sort of glass you know,

0:18:05.040 --> 0:18:07.720
<v Speaker 6>trophy with a twenty four carrot gold base or something,

0:18:07.720 --> 0:18:10.159
<v Speaker 6>you know, with the Apple logo on it. And you know,

0:18:10.200 --> 0:18:12.840
<v Speaker 6>guess what, you know, it was over tariffs and Cook

0:18:12.920 --> 0:18:17.040
<v Speaker 6>and Apple we're looking for some relief on foreign microchip tariffs.

0:18:17.040 --> 0:18:19.520
<v Speaker 6>So and you know that helped. It also helped though

0:18:19.520 --> 0:18:21.680
<v Speaker 6>that Cook had really put in the work though, talking

0:18:21.720 --> 0:18:24.440
<v Speaker 6>to Trump for years now, going back to the first administration.

0:18:24.760 --> 0:18:26.359
<v Speaker 6>So you can't just you know, sort of throw a

0:18:26.400 --> 0:18:29.360
<v Speaker 6>trophy at him. But it does take some groundwork as well.

0:18:29.480 --> 0:18:32.040
<v Speaker 6>But look at the Swiss business executives also giving him

0:18:32.040 --> 0:18:34.080
<v Speaker 6>a you know, a gold role X and you know,

0:18:34.160 --> 0:18:37.359
<v Speaker 6>so these things do tend to have an impact. As

0:18:37.400 --> 0:18:40.160
<v Speaker 6>we say, everything is a transaction with this president.

0:18:40.440 --> 0:18:43.440
<v Speaker 4>Matt, you mentioned it's been difficult getting people to speak

0:18:43.480 --> 0:18:45.600
<v Speaker 4>to you for this story. Did any of the business

0:18:45.680 --> 0:18:48.360
<v Speaker 4>leaders you spoke to give you reasoning for why they

0:18:48.480 --> 0:18:50.280
<v Speaker 4>might be afraid to talk or did they kind of

0:18:50.320 --> 0:18:51.160
<v Speaker 4>just brush you off?

0:18:51.440 --> 0:18:54.080
<v Speaker 6>It's I mean, many brush us off through their gatekeepers.

0:18:54.119 --> 0:18:56.520
<v Speaker 6>They just the thing is, they just don't see much upside.

0:18:56.520 --> 0:18:59.119
<v Speaker 6>They don't want to be the one CEO talking to

0:18:59.320 --> 0:19:02.200
<v Speaker 6>any report are on the record. But as we've seen now,

0:19:02.200 --> 0:19:03.840
<v Speaker 6>maybe we might see some more come out of the

0:19:03.880 --> 0:19:07.320
<v Speaker 6>woodwork now that Diamond and others are talking about you know,

0:19:07.400 --> 0:19:11.320
<v Speaker 6>the interest rates. The defense companies also might have something

0:19:11.359 --> 0:19:14.040
<v Speaker 6>to say about Trump pressuring them, you know, to up

0:19:14.040 --> 0:19:17.119
<v Speaker 6>their game. So we'll see. But it's that, you know,

0:19:17.600 --> 0:19:20.520
<v Speaker 6>CEOs again that they might be speaking out on certain issues,

0:19:20.520 --> 0:19:23.720
<v Speaker 6>but when it comes to Trump again, they just fail

0:19:23.800 --> 0:19:26.720
<v Speaker 6>to see the upside. But at this point, as we say,

0:19:26.840 --> 0:19:30.000
<v Speaker 6>or it was a Yale School of Management person wrote

0:19:30.040 --> 0:19:33.200
<v Speaker 6>today in Bloomberg Opinion, the chaos is not just no

0:19:33.200 --> 0:19:35.920
<v Speaker 6>longer in the background. The chaos is baked in. It's

0:19:35.960 --> 0:19:38.480
<v Speaker 6>in the system. It's coming for them, So they might

0:19:38.520 --> 0:19:39.040
<v Speaker 6>want us talk.

0:19:39.240 --> 0:19:41.199
<v Speaker 2>So yeah, it's front and center, and it feels in

0:19:41.240 --> 0:19:44.160
<v Speaker 2>many ways like those who know how to navigate governments

0:19:44.200 --> 0:19:46.200
<v Speaker 2>and emerging markets might be better positioned.

0:19:46.280 --> 0:19:48.639
<v Speaker 6>Yeah, so you have that experience exactly, you know, of

0:19:48.640 --> 0:19:52.359
<v Speaker 6>that sort of slightly more chaotic, slightly more freewheeling environments,

0:19:52.640 --> 0:19:55.520
<v Speaker 6>and many of these big multinationals, of course, do operate.

0:19:55.240 --> 0:19:56.040
<v Speaker 5>In those areas.

0:19:57.840 --> 0:20:02.520
<v Speaker 1>This is the Bloomberg Intelligence Podcast, available on Apple, Spotify,

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