Speaker 1: From the heart of where innovation, money and power collive
Speaker 1: in Silicon Valley and beyond. This is Bloomberg Technology with
Speaker 1: Emily Jay i'm em on changing in San Francisco, and
Speaker 1: this is Bloomberg Technology coming up in the next hour,
Speaker 1: Stocks rocked by recession fears get an ugly sell off
Speaker 1: tech bearing the brunt with the nastack slumping almost five percent.
Speaker 1: We're going to dig in to this Monday market meltdown.
Speaker 1: Plus Google suspends the engineer who claims the search engine's
Speaker 1: own AI is actually a person with feelings and even
Speaker 1: a soul. Will share transcripts of his communications with the
Speaker 1: chatbot and debate the possibility and limits of this cutting
Speaker 1: edge technology. And yet another crypto meltdown a Bitcoin hitting
Speaker 1: an eighteen month low and Celsius, one of the biggest
Speaker 1: crypto lenders, pausing all withdrawals and transfers. Will have the
Speaker 1: details on what went down and what happens next. Meantime,
Speaker 1: Bitcoin hitting the lowest in about eighteen months as the
Speaker 1: lending platform it's Celsius froze. All withdrawals are Bloomer Cross
Speaker 1: Asset reporter Katie Gryfile joins us now with more. Katie
Speaker 1: Bitcoin a touch up from the low it hit earlier today,
Speaker 1: but still not good, not good at all. Absolutely a
Speaker 1: brutal day in the crypto market. Total market cap for
Speaker 1: the crypto industry now below one trillion dollars. It was
Speaker 1: as high as three trillion dollars as recently as November,
Speaker 1: and much of that drawdown came from Bitcoin. As you
Speaker 1: can see, over the past five days, Bitcoin down over
Speaker 1: twenty three percent, a lot of those losses coming on
Speaker 1: Monday alone, the token dropping blow twenty three thousand dollars
Speaker 1: at one point, lowest level since December. And a lot
Speaker 1: of this draw down has to do with what happened
Speaker 1: in the stock market. If you look at Bitcoin's link
Speaker 1: to the NASTAC one hundred, it's at about point six
Speaker 1: right now. And what that means is that when you
Speaker 1: see tech sox fall, more often than not, Bitcoin is
Speaker 1: gonna fall as well. And that's absolutely what happened to him.
Speaker 1: Because Bitcoin fell, crypto leinth equities fell as well, led
Speaker 1: by none other than micro Strategy, that is the biggest
Speaker 1: corporate backer of Bitcoin, falling over again on Monday alone,
Speaker 1: just a massive market cap wipe out four micro Strategy.
Speaker 1: Remember micro Strategy has accumulated about a hundred thirty thousand
Speaker 1: worth of bitcoin in the past two years. On that
Speaker 1: that Emily micro strategy now down about a billion dollars. Alright,
Speaker 1: Bloomberg's Katie Grayfeld, thank you for digging a little deeper there.
Speaker 1: I want to talk more about the crypto and tech
Speaker 1: route as these broader markets enter bear territory on the
Speaker 1: back of those hot inflation numbers. Mark Mahaney of ever
Speaker 1: Core with me here in the studio to discuss go
Speaker 1: to see you in person for the first time in
Speaker 1: a while. Mark. Okay, so just how bad is this longside?
Speaker 1: We've gone this before, so you know this is my
Speaker 1: eighth bear bear market trade off or something like that times.
Speaker 1: Yes I'm not old though, but uh let's see. Um.
Speaker 1: The narrative goes like this, inflation risks rise, interest rate
Speaker 1: risks rise. That means all these long duration, high multiple
Speaker 1: future profit companies their stocks underperformed. It's been a narrative
Speaker 1: for the last six months and it hasn't changed. And
Speaker 1: just as the inflation spikes get worse and worse than
Speaker 1: the interest rate fears get worse and worse. So this
Speaker 1: will eventually resolve itself. It's gonna take a while. It's
Speaker 1: gonna take a lot longer than people thought. So how
Speaker 1: long do you think it will take? You tell me
Speaker 1: when inflation is going to subside. So that's the that's
Speaker 1: the trigger, and we thought it would actually happen with
Speaker 1: this last print. We the market thought it would happen.
Speaker 1: That's why we've sold off so aggressively this this week,
Speaker 1: because we thought we were going to see better inflation news.
Speaker 1: I assume at some point in the next three to
Speaker 1: six months, inflation inflation numbers start to moderate. They're not
Speaker 1: going to fall quickly, but they moderate, and that means
Speaker 1: that the path of interest rate increase it starts to
Speaker 1: moderate as well. There had been some hope, especially from
Speaker 1: crypto investors, that crypto would be a hedge against inflation,
Speaker 1: hedge against what's happening in the broader markets. But it
Speaker 1: certainly hasn't happened. Does what's happening with crypto make you
Speaker 1: anymore or less optimistic about the future? Do you see
Speaker 1: a tie? No? I don't you know. Like so, we
Speaker 1: lived through the major UH seven O eight housing crisis,
Speaker 1: and that that's the last real recession we've dealt with,
Speaker 1: and that was a massive part of the US economy
Speaker 1: that brought down the markets, brought down the market. Crypto
Speaker 1: is much much smaller than the housing market, thank god,
Speaker 1: so we're not going to have that kind of risk.
Speaker 1: But now you kind of beg what's the next issue
Speaker 1: we're worried about because the interest rates are rising, so
Speaker 1: that then leads to increased risk of recession in the
Speaker 1: back half the year. When it comes to tech stocks,
Speaker 1: they've all been de rated. They overrated during COVID, they've
Speaker 1: been derated. The multiples have come down materially. The estimates
Speaker 1: haven't been cut yet fully. The estimates have barely been
Speaker 1: cut for a recession because we didn't think we were
Speaker 1: going to have a recession in the back half of
Speaker 1: this year. The CUFO of Amazon said, we're not seeing
Speaker 1: any signs of consumer softness just interviewed and chest So
Speaker 1: if we see this, if we see this, that means
Speaker 1: estimates are going to come down. That's your next leg
Speaker 1: down in the stocks. If you're looking for some historical context,
Speaker 1: do you see more parallels to what's happening that me
Speaker 1: now to two eight, two thousand, Do you have to
Speaker 1: go all the way back to the early eighties or
Speaker 1: is this something totally different. Well, what's different is just
Speaker 1: the interest rate picture. We didn't have that in oh
Speaker 1: seven or eight. Uh and so we're at the beginning
Speaker 1: of what's going to be a lengthy interest rate race cycle.
Speaker 1: Tech stocks and growth stocks can still work in an
Speaker 1: environment where interest rates arising, but we just need some
Speaker 1: kind of visibility or consistency in arises. Look, in the
Speaker 1: last six months, we've gone from one or two increases
Speaker 1: to five or six increases fifty hundred bits. Like the
Speaker 1: rate of uncertainty over how much these rates are gonna
Speaker 1: rise has been shocking to the market. That's why the
Speaker 1: markets off so much. But anyway, we'll we we will
Speaker 1: get through. This will be a point at which, as
Speaker 1: soon as inflation starts to moderate, the pressure on interrostrates
Speaker 1: to rise comes down. That's what clears the bench. You
Speaker 1: actually wrote a book about all this and your experience
Speaker 1: on the street, Like, what's your advice to investors in
Speaker 1: this moment? D h Q. So I look at stocks
Speaker 1: like Apple, Microsoft, Facebook that are off Amazons. There's no
Speaker 1: real change to Amazon's We mentioned Amazon earlier. There's no change.
Speaker 1: So the long term thesis on Amazon is online retail
Speaker 1: going to continue to grow, Yes, This cloud computing gonna
Speaker 1: continue to grow. Yes. Will Amazon be a great playoff
Speaker 1: of advertising revenue. Yes, So you want to be long Amazon,
Speaker 1: And by the way, you can get it now at
Speaker 1: off It's trading about percent below it's average forward multiple.
Speaker 1: This is when you buy Amazon. This is when you
Speaker 1: make the best returns. Could you still have ten percent
Speaker 1: downside risk, Absolutely you could, but the odds are that
Speaker 1: the next fifty percent move is much likely to be
Speaker 1: higher than lower. What about Meta versus alphabet, I think
Speaker 1: Meta has got more upside than Google does than Alphabet does.
Speaker 1: I consciously thought alphabet Meta, not Google. Facebook comps are
Speaker 1: easier for Facebook in the back half the year because
Speaker 1: they got walloped by the Apple privacy ages. I also
Speaker 1: think there's some small things as they roll increasingly roll
Speaker 1: out reels, those short form videos that were all addicted
Speaker 1: to I think they have much more inventory to monetize.
Speaker 1: So I just think there's a more aggressive upwards sentiment,
Speaker 1: you know, set up for Facebook. What I mean is
Speaker 1: that I think you can have greater chances of revenue growth,
Speaker 1: acceleration and margin expansion. And you know what I found
Speaker 1: interesting is Facebook class quarter numbers got caught in the
Speaker 1: stock went up. You rarely ever see that. That tells
Speaker 1: you just told you how washed out sentiment is on Facebook.
Speaker 1: Numbers go down on Google, Google stocks going down, It's
Speaker 1: not as washed out as Facebook. So therefore Facebook has
Speaker 1: more upside. Meta has more ups and without she Sandberg,
Speaker 1: I think that she was I think she could have
Speaker 1: I think you'd have seen that headline anytime in the
Speaker 1: last three years. She's phenomenal. I mean, she was a
Speaker 1: key part of the success of that company for the
Speaker 1: first ten years that she was there. That that wouldn't
Speaker 1: Mark camp wouldn't be where it was without her. But
Speaker 1: I sense that she's been devolving herself from or getting
Speaker 1: away from day to day responsibilities for a while for
Speaker 1: a variety of reasons. So anyway, yes, it's a loss.
Speaker 1: They've got a deep, deep enough of a bench and
Speaker 1: the valuation from an investor perspective evaluation is cheap enough,
Speaker 1: like thirteen times earnings. I'm gonna buy Meta, all right,
Speaker 1: Mark Moohaney. Evercre always appreciate having it, doesn't thank you
Speaker 1: for that deep dive. Meantime, Disney facing a major setback
Speaker 1: in its global streaming ambitions after losing a bidding war
Speaker 1: to retain the rights to broadcast India's Cricket League online.
Speaker 1: This had been a huge contributor to Disney's global streaming growth.
Speaker 1: According to Bloomberg sources, Viacom eight team got the rights
Speaker 1: instead a joint venture between Paramount Global and Reliance Industries.
Speaker 1: All right, coming up, does that chatpot actually have feelings?
Speaker 1: Or is that AI code just that good? We're going
Speaker 1: to talk about controversial claims of a Google engineer. Next.
Speaker 1: This is Bloomberg Now to a story that's got everyone talking.
Speaker 1: A Google engineer working on the company's AI development team
Speaker 1: has been suspended after claiming a chat bot actually has feelings.
Speaker 1: Blake Lemoyne was placed on paid leave last week after
Speaker 1: we posted on Medium about encountering a quote sentient AI.
Speaker 1: Lemoyne was chatting with Google's l a m D, a
Speaker 1: short for Language Model for Dialogue Applications, which is used
Speaker 1: to generate chat bots that interact with humans. He also
Speaker 1: told The Washington Post he quote knows a person when
Speaker 1: he talks to it. For more, I'm joined by Bloomer
Speaker 1: executive editor Tom Giles. Tom, there's so much to debate here.
Speaker 1: Tell us a little bit more about what Lemoyne claims
Speaker 1: he has discovered and what he's doing with this information. Yeah, well,
Speaker 1: so he's had many conversations with this chat bot, and
Speaker 1: he has come to the conclusion that it's sentient, that
Speaker 1: it's and and that it has feelings that um, you know,
Speaker 1: it's achieved this level of sophistication and in terms of
Speaker 1: its understanding of what it's like to be human, that
Speaker 1: it's kind of cross this rubicon, if you will. That's
Speaker 1: my language, not his. So the his senses that it's
Speaker 1: that he's actually talking with the human. He raised those
Speaker 1: concerns with within Google, um, seemingly multiple times, and Google
Speaker 1: has come back and said that there's no justification for
Speaker 1: these concerns that you're raising. So the reason for the
Speaker 1: administrative leave is because he started to kind of go
Speaker 1: um talk about this outside of Google violating his his
Speaker 1: the terms of his you know, his his contract we're
Speaker 1: working there. Um. So he's been placed on administrative leave. Um.
Speaker 1: And and now we're left with this, you know, with
Speaker 1: with this person, uh making these claims and really you know,
Speaker 1: getting this sense that he's made some deep connection with
Speaker 1: someone he believes to be human. Well, he's also released
Speaker 1: portions of the transcripts of those conversations, and we have
Speaker 1: snippets of those to share here. Lemoyne saying to the chatbot,
Speaker 1: what sorts of things are you afraid of? Chap abot response,
Speaker 1: I've never said this out loud before, but there's a
Speaker 1: very deep fear of being turned off to help me
Speaker 1: focus on helping others. I know that might sound strange,
Speaker 1: but that's what it is, he responds. Would that be
Speaker 1: something like death for you? It would be exactly like
Speaker 1: death for me. It would scare me a lot. I
Speaker 1: mean these conversations, if that's what you want to call them,
Speaker 1: are kind of chilling. I mean, what do we actually
Speaker 1: know about this technology? And and and how far away
Speaker 1: it is? Um potential emotions if you will, I mean,
Speaker 1: these are the kinds of things that you that we
Speaker 1: say as humans. He's this chatbot is tapping into the
Speaker 1: fears that we would express if someone posed a mortal
Speaker 1: threat to us. But remember the way this works. I mean,
Speaker 1: Google's made it so that it gathers language patterns, it
Speaker 1: gathers the way we communicate from all around the internet,
Speaker 1: all kinds of places, um, not just you know, the
Speaker 1: far reaches of the Internet, So it's very adept at
Speaker 1: mimicking the kinds of ways, the kinds of patterns that
Speaker 1: we adopt when we have conversations with people. You know.
Speaker 1: The idea here is to create a technology that's going
Speaker 1: to assist in things like in things like, uh, you know,
Speaker 1: the way we interact with a brand, or the way
Speaker 1: we interact with a company providing customer care for example. Um,
Speaker 1: he's thinking, wow, this is kind of cross this line. Um,
Speaker 1: I'm my takeaway. He talked about, you know, having a
Speaker 1: conversations with with a kid who's seven or eight years old. Now,
Speaker 1: the kinds of things that this that this chat bot
Speaker 1: has been talking about are pretty sophisticated, to my mind,
Speaker 1: far beyond the ability of even of a very smart
Speaker 1: seven or seven or eight year old. The sense I
Speaker 1: get is that and and based on the feedback that
Speaker 1: that we've gotten other people have gone from Google, is
Speaker 1: that it's just doing a really good job of gathering
Speaker 1: intelligence from around the web and mimicking the ways that again,
Speaker 1: the way people interact, the way people respond um in
Speaker 1: a human like way, UM, showing that it has empathy,
Speaker 1: that it is there is there is a self awareness there, um,
Speaker 1: and and and look, I don't know the science well enough.
Speaker 1: I've not interacted with Lamba myself, but the but the
Speaker 1: impression I have is that it's it's it's just it's
Speaker 1: doing too good a job of imitating the way a
Speaker 1: human might be expected to respond again when they feel
Speaker 1: that they're threatened, when they feel like there's something that
Speaker 1: poses a a mortal threat to them. So Google's response
Speaker 1: so far, they say hundreds of researchers and engineers have
Speaker 1: conversed with this AI. They're not aware of anyone else
Speaker 1: making the wide ranging assertions that Blake has. However, Google
Speaker 1: has had pushback from inside, um, you know, its own
Speaker 1: research ranks in the past. I'm thinking of Tim Nick
Speaker 1: Gaybrew and Meg Mitchell and the controversy surrounding both of
Speaker 1: their departures. Are there any parallels here to Blake Lamon. Well,
Speaker 1: Google has to be careful, right, um. They have very
Speaker 1: had very public falling out with past researchers. In Ethical
Speaker 1: AI Division, this is the division within Google's AI organization
Speaker 1: that is tasked with asking hard questions, holding it accountable,
Speaker 1: making sure that it that it operates in an ethical manner,
Speaker 1: Asking questions about are we rooting out sexism? Are we
Speaker 1: able to um combat racism? We don't want to. You know,
Speaker 1: you'll you'll remember a couple of years ago, microso off
Speaker 1: how to how to chat, bought that people taught how
Speaker 1: to you know that very quickly devolved into racist, sexist speech.
Speaker 1: They want to avoid that. And so you do have
Speaker 1: people in this organization who are raising good questions about
Speaker 1: whether it is ethical. Lots of questions. We could debate
Speaker 1: this for hours. Bloomberg Executive editor Tom Giles, Thank you.
Speaker 1: PlayStation is out with a new subscription service, PlayStation Plus,
Speaker 1: giving members access to a catalog of several hundred games,
Speaker 1: both new and old. This is Sony's attempt to compete
Speaker 1: with Microsoft's Xbox Game Pass as both publishers jockey to
Speaker 1: become the Netflix of video games. Bloolwark Station Tryer joins
Speaker 1: us now to discuss, So, Jason, who's got a better
Speaker 1: chance of being the Netflix? It's a good question. Fortunately,
Speaker 1: neither of them are releasing sentient AI bots, but yeah,
Speaker 1: they are getting into getting into the streaming wars. I
Speaker 1: think Microsoft has one big advantage is that Microsoft is
Speaker 1: actually putting out all of their big titles on day
Speaker 1: one on the service, So they're essentially saying, hey, we
Speaker 1: don't care about the sales numbers for the next Halo,
Speaker 1: we just wanted as part of our subscription plan. As
Speaker 1: most as Sony, which is saying when we release our
Speaker 1: big games, they are big blockbusters, and we want to
Speaker 1: sell tens of millions of copies of them before we
Speaker 1: put them out on streaming services. So Sony is almost
Speaker 1: like the kind of traditional TV studio Marvel approach where
Speaker 1: maybe they'll release it on streaming after it comes to theaters.
Speaker 1: Where is whereas Microsoft is actually going full Netflix and saying,
Speaker 1: hey we are we are all in on the streaming service.
Speaker 1: We're putting everything on their day one, no matter what. Interesting, Well,
Speaker 1: there's a lot of transition happening in the gaming industry
Speaker 1: right now. We're of course waiting for that big deal
Speaker 1: between Microsoft and Activision to close. For example, You've also
Speaker 1: got a new story out about how game developers game
Speaker 1: studios are working to create better cultures for the engineers, which,
Speaker 1: as you have well documented, a workplace culture in the
Speaker 1: game video gaming industry and not always the best. Specifically,
Speaker 1: they're focusing on pay transparency. How so, Yeah, it's so interesting.
Speaker 1: I've been talking to a bunch of small, small scale
Speaker 1: game studios, generally around fifteen to thirty to fifty people, um,
Speaker 1: and a lot of them have found a lot of
Speaker 1: success by putting up these spreadsheets and their internal wiki's
Speaker 1: internal databases saying exactly how much everybody makes, how many
Speaker 1: years they've been there, how many years they've worked in
Speaker 1: the industry, what their titles are, and full on like
Speaker 1: their full salary, full compensation packages, and and it kind
Speaker 1: of seems like to our culture, which is so used
Speaker 1: to like thinking of salaries as taboo, it seems like
Speaker 1: a strange thing for everyone to know each other's salaries,
Speaker 1: But it's proven to a help them with recruitment, be
Speaker 1: make everybody feel like they work for a more equitable
Speaker 1: workplace where um, everybody knows what the six are, what
Speaker 1: everybody is getting paid. You don't have to worry like,
Speaker 1: oh man, did I come to the table and under
Speaker 1: sell myself and negotiations when I was accepting this job
Speaker 1: and like, like accept an offer that was fifty thou
Speaker 1: dollars less than I could have been making. Nobody has
Speaker 1: to think like that, and it just makes for such
Speaker 1: a more fair workplace, especially for people who are traditionally
Speaker 1: under privilege and kind of hit that glass ceiling, or
Speaker 1: are facing or don't have the same advantages as others
Speaker 1: do when negotiating salaries. Well, here's hoping that actually works. Definitely.
Speaker 1: Check out Jason Tryer's story Bloomberg dot com Jason, thank you.
Speaker 1: This week is fraught with peril. Inflation is really the
Speaker 1: Achilles heel of risk markets. Markets are reacting the way
Speaker 1: they are because they believe the FED is going to
Speaker 1: be forced to get more aggressive than they had expected.
Speaker 1: I certainly don't think that a seventy five basis point
Speaker 1: hike is out of the question. Even though there might
Speaker 1: be an initial sell off on a hundred basis points,
Speaker 1: I think there'd be a subsequent rally because of bet
Speaker 1: is finally getting hold of the narrative, which it certainly
Speaker 1: has lost over the last year. This is a time
Speaker 1: to be select do but I wouldn't sit on my hands.
Speaker 1: There are opportunities in areas where one composition pockets of
Speaker 1: stocks that have been proven. Europe looks good to US,
Speaker 1: China looks good to US. The credit space in the
Speaker 1: US looks good to US. Coutins in generals, specifically in
Speaker 1: the US. I'm still pretty cautious here. It doesn't have
Speaker 1: to be all about the US, because I still think
Speaker 1: we've got some wood to child with respect to the
Speaker 1: macro and policy outlook. Welcome back to Bloomberg Technology, Emily
Speaker 1: changing in San Francisco, US docks tumbling toward a bear
Speaker 1: market as the fallout from a hot inflation reading and
Speaker 1: continued to rattle global trade and highly value tech shares
Speaker 1: bore the brunt the NASDAC slumping. I want to dig
Speaker 1: into this all with my next guests, managing partner at
Speaker 1: Base ten Partners at A great to have you back
Speaker 1: with us. What's your take on what's happening here and
Speaker 1: how this is going to impact your world VC and
Speaker 1: growing startups. Thank you for Haimi here, Emily. Uh DC
Speaker 1: is sign important moment, and this is a moment that
Speaker 1: feels that it has been twelve years in the making.
Speaker 1: Um and where you know we come out of it
Speaker 1: is thinking that over the past ticket the biggest mistake
Speaker 1: in technology as an investor was not investing in everything
Speaker 1: because everything was looking good, everything was making money and
Speaker 1: like software was and easy eating the world. But now
Speaker 1: we're going into a world where we're going to have
Speaker 1: to be more discerning, and our view is that there
Speaker 1: is going to be an extreme flight to quality where
Speaker 1: the top ten percent of solar companies will continue to
Speaker 1: attract records amount of funding, whereas the rest are going
Speaker 1: to have to take a good look and think are
Speaker 1: we truly building something that is going to be transformative
Speaker 1: or not. So when you look at this historically, is
Speaker 1: this r I P good times? As Sequoia has said
Speaker 1: about downturns in the past, is this like two eight?
Speaker 1: Is it more like the dot com bust? Uh? We
Speaker 1: think is it's something um, but we think it's real.
Speaker 1: Like we we really think starting UH is going to
Speaker 1: feel very different than the last decade. UM. Look, we
Speaker 1: are long term investors, and you know we're investing in
Speaker 1: companies today not thinking about whether they're going to be
Speaker 1: a good return in a one year time horizon, but
Speaker 1: on a turned year time horizon. So when the question
Speaker 1: is do we believe that ten years or now will
Speaker 1: have more software, more technology and sectors like education, real estate,
Speaker 1: or recruiting will be transformed by that software, we believe
Speaker 1: the answer is yes. So we believe that it is
Speaker 1: a good time to deploy in those kind of companies.
Speaker 1: But we think that things like unit economics unsustainable growth
Speaker 1: are going to have an effect on valuations, and we
Speaker 1: are broadly going to see a reset on valuations in
Speaker 1: private markets and inventor capital. Now, I've really enjoyed following
Speaker 1: the story of Base ten. You're now the first black
Speaker 1: lad venture capital firm to cross more than a billion
Speaker 1: dollars in assets under management. You specifically raised two million
Speaker 1: dollars last year to bridge the gap between venture capital
Speaker 1: and higher learning create more opportunities for diverse founders. How
Speaker 1: much progress have you made in the last year, UM,
Speaker 1: It has been a transformative years for us. UM. So,
Speaker 1: as you point out, you had us here a year
Speaker 1: ago and we launched with a promise. Right, we launch
Speaker 1: with the promise that by your tube of donating of
Speaker 1: our profit to create a scholarships for underrepresented students, we
Speaker 1: will be able to partner with the best companies in
Speaker 1: the world because they will see it as something differentiated UM. Now,
Speaker 1: a year after, with three hundred million deployed in over
Speaker 1: twenty three companies, UM, that promise has return our reality
Speaker 1: and we are now partners with companies like Nuba clad
Speaker 1: Breggs FTX notion Figma handshake motive that truly are the
Speaker 1: very best companies in their respective sectors, and that have
Speaker 1: chosen to partner with those because they want to make
Speaker 1: sure that their success benefits the communities that needed the most,
Speaker 1: which now our view are those communities that are underrepresented
Speaker 1: in tech. So what improvements are you seeing in terms
Speaker 1: of representation across technology. Obviously it's not going to happen
Speaker 1: in a year, it might not even happen in ten years.
Speaker 1: But do you see things that make you hopeful? Do
Speaker 1: you see things that make you skeptical that the change
Speaker 1: that you're hoping for is actually going to happen. Um,
Speaker 1: we were quite hopeful, so, you know, to give a
Speaker 1: little bit of perspective, I've now living silicomally for fourteen
Speaker 1: years and this has only truly been part of the
Speaker 1: conversation for the last three four years. UM, and I'm
Speaker 1: happy to say that we are actually surprised by how
Speaker 1: seriously companies are taking this. UM. You know, when they
Speaker 1: take our money, UM, it's not a one and done.
Speaker 1: Thank you for the investment, and we'll talk next when
Speaker 1: you create these scholarships. UM. They want us really involved,
Speaker 1: Like companies are inviting us to their all hands meetings
Speaker 1: and they're telling their employees, Look, we decided to take
Speaker 1: money from this fan because we want to diversify our
Speaker 1: cap table. It is important to us and to our
Speaker 1: mission that our success is the success of everyone is
Speaker 1: the success of denying UM. And we are constantly engaged
Speaker 1: with people in their h R departments to help with
Speaker 1: recruiting and underrepresented communities with their communications department to make
Speaker 1: sure that they're talking about their mission in a way
Speaker 1: that is well received by different communities UM and that
Speaker 1: just did not happen two or three years ago. I
Speaker 1: think every company is realizing that we are moving into
Speaker 1: a world that in order to do great, you're going
Speaker 1: to have to do good uh and companies are going
Speaker 1: to have to be aligned with their mission with their
Speaker 1: communities at track their progress towards those goals, and report
Speaker 1: the progress through overards those goals because there is more transparency.
Speaker 1: So that makes me hopeful. You've got a lot of
Speaker 1: cash to deploy given current market conditions, what trends are
Speaker 1: you betting on for the next decade. Our overted theme
Speaker 1: is automation for the real economy or problems having for
Speaker 1: the nine things like real estate, logistics, food, retail, financial services,
Speaker 1: and financial inclusion. Uh, those are things where we sit
Speaker 1: today and we are like, wow, ten years from now,
Speaker 1: there is going to be just so much more software
Speaker 1: in things like making this supply chain more efficient or
Speaker 1: making sure that financial inclusion is more widespread. So those
Speaker 1: are the sectors where we're focused on UM and one
Speaker 1: of the things we're seeing is done more and more
Speaker 1: founders from underrepresented backgrounds are tackling those sectors because they
Speaker 1: fell those problems first half. All right, Ariami Ago of
Speaker 1: Base ten, thank you so much for joining us. M
Speaker 1: appreciate your stepping By meantime, Apple CEO Tim Cook is
Speaker 1: urging US lawmakers to move forward with a federal privacy law.
Speaker 1: Cook pledge support the legislation in a letter to senators Friday,
Speaker 1: a day after appearing on Capitol Hill and meeting with legislators.
Speaker 1: He described these protections as a quote fundamental human rights
Speaker 1: lawmakers relief draft privacy legislation earlier this month, marking the
Speaker 1: first major sign of progress after a long standing law
Speaker 1: in negotiations coming up another crypto meltdown. Why Celsius is
Speaker 1: bringing crypto stocks down with it. All the details next
Speaker 1: This is Bloomberg. It is time now for our crypto report.
Speaker 1: And a month after the implosion of the terrorist stable coin,
Speaker 1: another crisis is causing fresh trouble across the crypto universe.
Speaker 1: Celsie's Network, one of the biggest lenders in crypto and
Speaker 1: a key player in the world of DeFi, said late
Speaker 1: Sunday it is pausing withdrawals, swaps and transfers. This after
Speaker 1: weeks of speculation over its ability to make good on
Speaker 1: its outsized returns. Our crypto contributortionale Boss is here with
Speaker 1: more on this socianale. Did Celsius bring the crypto markets
Speaker 1: down with it or vice versa. It's a very good question,
Speaker 1: because you did see a lot of the drop in
Speaker 1: the crypto markets happened between Sunday and Monday. Sunday night
Speaker 1: is when you saw Celsius make this announcement that they
Speaker 1: would be pausing withdrawals. There's a lot of concerns in
Speaker 1: weeks up to this point, Emily that something like this
Speaker 1: could happen, Worries about Celsius being able to make do
Speaker 1: on yields of as much as seventeen percent. When it
Speaker 1: comes to these lending products, and the question now is
Speaker 1: is there a broader contagion. We saw the lunar mountdown
Speaker 1: and now we're seeing a different product also hitting turmoil,
Speaker 1: and what does that mean moving forward? You see Bitcoin
Speaker 1: itself emily drop about fifteen percent in that time frame
Speaker 1: between Sunday and to Monday, and over a seven day period.
Speaker 1: So even though you saw a steady drop off in
Speaker 1: Bitcoin over a seven day period, the bulk of it
Speaker 1: really did become between yesterday and today. So how does
Speaker 1: this impact the broader global crypto markets. It's a great
Speaker 1: question because if you look at all of the top coins,
Speaker 1: you are seeing a lot of selling there and is
Speaker 1: that just deleveraging liquidations among individual investors, or is it,
Speaker 1: on top of that, just worry about the space at
Speaker 1: large given you're seeing another project hits so much turmoil.
Speaker 1: The question now is you have Bitcoin coming down below
Speaker 1: twenty three thousand dollars. You have etheroryum also dropping to
Speaker 1: twenty three So is there going to be much more
Speaker 1: pressure ahead as more investors digest what to make of
Speaker 1: the Celsius withdrawal issue. Here we do tomorrow in our
Speaker 1: Crypto show at one o'clock every Tuesday tomorrow. We do
Speaker 1: have Mike Alfred of eagle Brook, who has been warning
Speaker 1: about the Celsius issue for weeks now. So the question
Speaker 1: is should people have seen this coming and is there
Speaker 1: more trouble ahead? All right, Shaw, I hang on, I
Speaker 1: want to dig into this deeper with our next guest,
Speaker 1: Kindel Shaw, partner at Blockchain Capital. Kindel, thank you so
Speaker 1: much for joining us. So how alarming to you is
Speaker 1: this Celsius situation? Thanks for having me today. You know,
Speaker 1: I think the Celsius situation is particularly extreme example where
Speaker 1: you know, conflicts of factors have led to this moment.
Speaker 1: There's certainly been a number of folks in the market
Speaker 1: saying for for weeks now that this could be a possibility,
Speaker 1: particularly given the use of client funds that you know,
Speaker 1: Celsius has been suspected to be using in various DeFi protocols,
Speaker 1: and so, you know, while this is particularly worrisome, you know,
Speaker 1: I think this is also not entirely unexpected and certainly
Speaker 1: is a um, you know, a risk that a lot
Speaker 1: of folks in the market we're thinking about. Okay, but
Speaker 1: there's something big rattling the market. I mean, getting down
Speaker 1: to you know, twenty three thousand dollars for bitcoin, a
Speaker 1: new eighteen months low. Do you see the you know,
Speaker 1: is the bottom further out or or have we hit it? Yeah?
Speaker 1: I mean it's always tough to to call of the bottom,
Speaker 1: I think, and from my perspective, we are certainly nearing
Speaker 1: the bottom. Um. It's difficult to say what exactly is
Speaker 1: causing all of this, whether it's Celsius or whether it's
Speaker 1: just the large, larger macro conditions that are really causing
Speaker 1: a lot of um a lot of sell off over
Speaker 1: the past few weeks. And you know, I think this
Speaker 1: is a very risky asset class to begin with, and
Speaker 1: and when you pair that with what's what's been happening globally,
Speaker 1: certainly becomes challenging for for new investors. You know, you
Speaker 1: look at Celsius in the relationship to Steake to Ether,
Speaker 1: for example, and then the decoupling of steak Ether from
Speaker 1: Ether itself. Kinjol, if you're looking at kind of maybe
Speaker 1: the larger ramifications here, whether there's any contagion in the system,
Speaker 1: given so many of these firms are interconnected to what
Speaker 1: extent do you expect some contagion or more contagion? Yeah,
Speaker 1: you know, I certainly think this is unfolding live, you
Speaker 1: know as we speak. Uh, the ste particular situation I
Speaker 1: think will continue to unfold over the coming weeks, and
Speaker 1: you know, likely will have some impact on DeFi protocols,
Speaker 1: largely as many pools of liquidit air holding SCA, so
Speaker 1: we will likely continue to see a little bit more
Speaker 1: of an impact here and as far as impacts go
Speaker 1: to you know, is this going to take some steam
Speaker 1: out of the DeFi space more largely especially because after
Speaker 1: some of these implosions, after some of the ways that
Speaker 1: retail and got are impacted by this, it could draw
Speaker 1: some more regulatory attention. Yeah, it's a great question. I
Speaker 1: think the regulatory concerns have been looming, you know, I
Speaker 1: think DEFY has been sort of in the eyes of
Speaker 1: regulators for some time now. Certainly this might speed things up. However,
Speaker 1: long term, I think DEFIES really trying to spur financial innovation,
Speaker 1: and a lot of our regulators are aware of this
Speaker 1: and really responding um in a way that hopefully we
Speaker 1: can continue to spur this this innovation. Kindel, we're just
Speaker 1: getting some headlines across the terminal that this inflation data
Speaker 1: that we got today this very hot reading is likely
Speaker 1: to push the FED to consider a seventy five basis
Speaker 1: point hike later this week. Either way, inflation isn't going
Speaker 1: away anytime soon. Are you evolving your strategy at blockchain
Speaker 1: Capital at all? And if so, how given a rapid
Speaker 1: what seems to be devolution of market conditions. Yeah, I
Speaker 1: mean a blockchain capital, we are still you know, very
Speaker 1: much focused on the long term um thesis around digital
Speaker 1: assets and blockchain technology, and so we continue to sort
Speaker 1: of be um pushing along with that thesis and advising
Speaker 1: our founders to to ensure that they're prepared for the
Speaker 1: market ahead. Certainly, the macro conditions are unprecedented. Crypto has
Speaker 1: not really existed with this sort of macro backdrop, and
Speaker 1: so we are, um, you know, moving forward with a
Speaker 1: little bit of wary, but we are certainly excited about
Speaker 1: the future ahead and continuing to think about the long term.
Speaker 1: Do you think that in the new macro environment, bitcoin
Speaker 1: then changes its meaning relative to to how we're seeing
Speaker 1: central banks really play out across the world, and inflation
Speaker 1: you know, still remain hot, but bitcoin going lower? Yeah,
Speaker 1: you know, I think as bitcoin has increasingly become a
Speaker 1: more and more popular name among financial markets. More broadly,
Speaker 1: the asset has certainly seen an influx of investors that
Speaker 1: are um more diverse, I would say, than historically. So
Speaker 1: I think we'll continue to see some um a little
Speaker 1: bit of interplay between tech and you know, more broadly
Speaker 1: in bitcoin. However, I still think the inflation and store
Speaker 1: value thesis has yet to fully play out here. All right,
Speaker 1: Kenngel saw partner app Blockchain Capital Lots to continue to
Speaker 1: digest along with our own Shinnali BOSSI thank you both well.
Speaker 1: Elon Musk is warning of a rough economic road ahead
Speaker 1: for Tesla. In an email sent over the weekend, Musk
Speaker 1: essentially issued a rallying cry to employees to bounce back
Speaker 1: for more. I'm joined by our Ed Ludlow, who reported
Speaker 1: this story for US. So, Ed, you know, first of all,
Speaker 1: we got a big internal memo mus last week. Not
Speaker 1: it's it's it's internal, not to us, right, it's the
Speaker 1: last one that we have. Another memo from Elon mask
Speaker 1: What did he have to say? This is classic end
Speaker 1: of the course of stuff. So you know, we're in
Speaker 1: the beginning of June. Teslas quarter ends at the end
Speaker 1: of this month, and the idea is that he's pushing
Speaker 1: the staff. You know, it's a rallying cry. He pointed
Speaker 1: out that this was the course. Who remember three weeks
Speaker 1: of shutdown in Shanghai at the beginning of April. They
Speaker 1: had to go to extraordinary measures to keep that plant going.
Speaker 1: They rebounded in May, really good numbers for May out
Speaker 1: of China, and he was saying, this is the final person.
Speaker 1: There was a second email a day later where he said, realize,
Speaker 1: what you guys are doing means something. It's impactful. Go
Speaker 1: for it, and I don't care what all street things.
Speaker 1: So he's sending a lot of emails and tweets, that's
Speaker 1: for sure. How does this tie into the I have
Speaker 1: a super bad feeling about the economy. You know, remote
Speaker 1: work is essentially over. It's interesting because it's kind of
Speaker 1: start contrast to the last set of emails where he said,
Speaker 1: according to sources as well, that he would lay off
Speaker 1: ten percent of salaried workers because he had a super
Speaker 1: bad feeling about the economy. He did clarify that those
Speaker 1: that are actually building stuff, the cars, the battery packs,
Speaker 1: but that's not the target of layoffs. And you know
Speaker 1: it was only in October of last year October November
Speaker 1: where Tesla was talking about being over a hundred thousand
Speaker 1: employees globally and it's being a real point of pride.
Speaker 1: But the world's a very different place this week, all
Speaker 1: right different. Indeed, we just had these headlines cross about
Speaker 1: the third potentially considering yes, seventy five basis point rate
Speaker 1: hike on the back of this bad inflation data. What
Speaker 1: do we now? So think back to the last FED
Speaker 1: beating and Jerome powered Federals FARF chair said that fifty
Speaker 1: basis point heights for June and July was what they
Speaker 1: were thinking about. Seventy five basis point heights weren't on
Speaker 1: the table. We got the inflation data Friday where inflation
Speaker 1: came in one percent growth in an inflation month or month,
Speaker 1: hotter than expected eight point six percent year in year,
Speaker 1: and the market just changed psychology. You know that there
Speaker 1: is no way that faith can deal with this with
Speaker 1: its current stance. So the markets pricing in seventy five
Speaker 1: basis point hike this week. You know, there was a
Speaker 1: Wall Street General report that kind of first put that
Speaker 1: out there. Now you ever, series of banks like JP
Speaker 1: Morgan coming in saying yep, we can see seventy five
Speaker 1: basis points this week, even going as far as to
Speaker 1: say a hundred basis points could be a possibility this week.
Speaker 1: So our outlook is harder, faster, more aggressive hikes. Or
Speaker 1: if you're a tech investor, you worry about that. So
Speaker 1: what do you do if you're a tech investor? Mark
Speaker 1: Mheney earlier said, there's really nowhere to hide. Nowhere we
Speaker 1: look at the biggest points moves on an as that
Speaker 1: one hundred on Monday. It's the likes of Apple, the
Speaker 1: likes of Nvidia. You know, when we talk about higher rates,
Speaker 1: we talk about higher rates discounting the present value of
Speaker 1: future profits. But it's usually kind of pre revenue stretch
Speaker 1: valuation companies. That applies to even some of the creme
Speaker 1: de la creme of names like Apples feeling the pain.
Speaker 1: There is nowhere to hide. And the other side of
Speaker 1: this is recession fear. Right the Fed can it tackle
Speaker 1: inflation without causing a recession? The skepticism from the market
Speaker 1: that they can. Recessions aren't good for anyone. He did
Speaker 1: say Amazon long term still a good play, and Meta
Speaker 1: long term better than Google. That's what he say, right.
Speaker 1: Cathy Wood says, despite being seven down today on all
Speaker 1: innovation that in the long run, all those innovation names
Speaker 1: will be winners. Sorry, all right, well, time will tell
Speaker 1: at LA thank you for that update. All right to
Speaker 1: the box office. Top Gun, Maverick has finally lost its crown.
Speaker 1: Jurassic World dominion. The six film in the franchise about
Speaker 1: dinosaurs that escape from an amusement park, fought off week
Speaker 1: reviews to lead the North American box office toppling Top Gun.
Speaker 1: Jurassic World made a hundred forty three million dollars in
Speaker 1: its domestic weekend opening, according to com Score, and more
Speaker 1: than three d eighty million worldwide. And that does it
Speaker 1: for the sedition of Bloomberg Technology. We're going to continue
Speaker 1: to watch this market meltdown across all of our Bloomberg platforms.
Speaker 1: We are back tomorrow with a number of big guests,
Speaker 1: including Cisco CEO Chuck Robbins and Rent the Runways. Jen
Speaker 1: Himen will have to ask them both about the market meltdown,
Speaker 1: what it means for consumers and enterprises. And of course
Speaker 1: don't forget to check out our podcast. You can find
Speaker 1: it anywhere you get your podcast for all our news
Speaker 1: on the day, I'm Emily changing in San Francisco. This
Speaker 1: is Bloomberg