WEBVTT - U.S. Posts Robust Job Gains, Mixed Inflation Signs 0:00:01.760 --> 0:00:04.400 This is Bloomberg Business Week. I'm Carol Masser and I'm 0:00:04.440 --> 0:00:07.240 Bloomberg Quick Takes Tim Stanivk. We're here every day bringing 0:00:07.280 --> 0:00:09.800 you the latest news from the world to business and finance, 0:00:09.800 --> 0:00:13.640 plus technology, politics, economics, all parnessing the power of Business 0:00:13.640 --> 0:00:17.119 Week reporters and editors, not to mention our journalists and 0:00:17.120 --> 0:00:19.960 analyst in more than one twenty countries. You can download 0:00:20.000 --> 0:00:23.200 Bloomberg Business Week and iTunes, SoundCloud, or Bloomberg dot Com. 0:00:23.360 --> 0:00:25.160 You can also listen to our radio show at two 0:00:25.160 --> 0:00:27.840 pm Eastern Time on Bloomberg Radio or watch us on 0:00:27.880 --> 0:00:32.160 YouTube search Bloomberg Global News. Alright, so, as we talked 0:00:32.159 --> 0:00:34.839 about US hiring advance at a robust pace in April, 0:00:35.120 --> 0:00:37.760 yet a smaller labor force may increase pressure on employees 0:00:37.760 --> 0:00:40.159 to boost wages even more to bring workers back. And 0:00:40.200 --> 0:00:42.120 in case you missed it, we talked about at the 0:00:42.120 --> 0:00:44.320 top of the show, non farm payrolls rose four hundred 0:00:44.400 --> 0:00:48.000 twenty eight thousand last month, broad based advance, matching the 0:00:48.040 --> 0:00:51.160 game in March, and then, of course, had the unemployment 0:00:51.240 --> 0:00:54.240 rate holding a three point six percent Averagearily, earnings rose, 0:00:54.280 --> 0:00:57.000 albeit at a more moderate pace from a month earlier. 0:00:57.080 --> 0:00:59.760 Something you Lena definitely focused on. Let's get into it 0:00:59.760 --> 0:01:02.800 with Relea Pollock, the chief economist at ZIPP Recruiter, joining 0:01:02.920 --> 0:01:05.760 us on the phone from Santa Monica, California. Julia, how 0:01:05.760 --> 0:01:07.920 are you in Santa Monica? I know you'd be much 0:01:07.959 --> 0:01:11.000 more hill are you. That's that's the East coast versus 0:01:11.000 --> 0:01:13.480 West coast right there, you know, Uh, Julia, I want 0:01:13.480 --> 0:01:16.160 to talk about the labor labor numbers of course, um. 0:01:16.200 --> 0:01:19.120 You'll initially at from Bloomberg Economics earlier told us that 0:01:19.319 --> 0:01:21.760 this jobs report had had something for for everybody. What 0:01:21.840 --> 0:01:25.160 stuck out to you? Well, I think you know, any 0:01:25.240 --> 0:01:27.520 day you have a big number like this, and the 0:01:27.560 --> 0:01:30.840 games are that broadly distributed across the economy. It's a 0:01:30.880 --> 0:01:36.080 good day for workers, uh, and for hundreds of thousands 0:01:36.120 --> 0:01:38.800 of companies that managed to feel vacancies despite all the odds. 0:01:39.760 --> 0:01:43.160 Um As you dig deeper, the unemployment rate a little 0:01:43.160 --> 0:01:47.520 bit higher than everybody force forecast, labor participation rate going 0:01:47.600 --> 0:01:52.160 down a little bit, average hourly earnings increasing a little 0:01:52.160 --> 0:01:54.840 bit less. So as you dig a little bit deeper, 0:01:55.080 --> 0:01:58.400 how do the data points from the Labor department kind 0:01:58.400 --> 0:02:00.400 of cross with what you are seeing special effectly at 0:02:00.440 --> 0:02:04.920 ZIP Recruiter. Sure, so it's hard to know from what 0:02:04.960 --> 0:02:08.240 we're seeing in the report whether there's any cool down 0:02:08.280 --> 0:02:11.960 happening in the labor market. Yes, average wages are growing 0:02:12.000 --> 0:02:14.959 a bit more slowly, but still at quite a high pace. 0:02:15.040 --> 0:02:17.480 From six point four percent wage growth for non supervisory 0:02:17.520 --> 0:02:21.480 employees is you know, nothing to sneeze at um eleven 0:02:21.760 --> 0:02:26.760 twelve percent pay increases in leisure, hospitality, and in transportation 0:02:26.840 --> 0:02:29.920 warehousing for for ranked file employees, and those are very 0:02:29.960 --> 0:02:36.120 large numbers. Of course, inflation is outstripping pay gains for 0:02:36.120 --> 0:02:38.799 for most employees, but there are still many workers coming 0:02:38.800 --> 0:02:42.839 out ahead. Um that said, we have so many low 0:02:42.919 --> 0:02:49.840 wage workers. Whoops, we're just a little technical difficulty there. 0:02:49.840 --> 0:02:52.399 So hopefully we'll come back to Julia polit Chief Economists 0:02:52.600 --> 0:02:54.880 and ZIP Recruiter, because it was interesting she was gonna 0:02:54.880 --> 0:02:56.840 get into the lower end of the labor force. You 0:02:56.880 --> 0:02:59.080 know what I thought was really fascinating about about the 0:02:59.120 --> 0:03:02.640 way that that she just spoke to us is she 0:03:02.639 --> 0:03:06.799 she presented it in a sense of the employers being 0:03:06.880 --> 0:03:10.480 fortunate to have found labor, which I think is really 0:03:11.200 --> 0:03:13.200 speaks volumes as to where we are right when we 0:03:13.200 --> 0:03:15.680 think about the labor report, we oftentimes look at it 0:03:15.680 --> 0:03:18.200 from the perspective of the worker correct and how many 0:03:18.240 --> 0:03:20.480 Americans are working with the unemployment rate is And she 0:03:20.520 --> 0:03:22.519 said ZIP recruiters, so she knows that the struggles that 0:03:22.560 --> 0:03:25.320 these companies are having actually finding employees. So she said 0:03:25.320 --> 0:03:27.000 that you know more than one of the companies that 0:03:27.000 --> 0:03:29.760 were able to find employees. Think about coming just from 0:03:29.760 --> 0:03:31.480 Milkin and I know the panel I did with the 0:03:31.520 --> 0:03:34.840 CEO of Lowes and Kroger Um stitch fix. I mean, 0:03:35.520 --> 0:03:39.000 top of mind is labor and finding the workers they need. Um, 0:03:39.080 --> 0:03:41.000 let's get back to our guests, Julia Pollock, she's chief 0:03:41.040 --> 0:03:43.720 economist and ZIP recruiter. You know, Julia, Tim and I 0:03:43.760 --> 0:03:46.440 were just at the Milken Institute Global Conference and we 0:03:46.440 --> 0:03:50.120 were talking to CEOs from all industries and top of 0:03:50.200 --> 0:03:53.839 mind is being able to find the workers that they need. UM, 0:03:54.240 --> 0:03:56.440 tell us if that's what you're finding in the data 0:03:56.480 --> 0:03:59.280 points that you guys are tracking as well. Well. There 0:03:59.320 --> 0:04:01.800 are two job openings to every unemployed worker right now. 0:04:02.000 --> 0:04:04.440 Historically it's been the reverse, there have been more than 0:04:04.520 --> 0:04:08.240 two unemployed workers per opening. So this is the tightest 0:04:08.280 --> 0:04:11.040 lave market on records. It means that employers are having 0:04:11.080 --> 0:04:14.440 a really tough time finding you candidate to the vacabuse. 0:04:14.560 --> 0:04:17.680 And at the same time they're seeing these record breaking 0:04:17.760 --> 0:04:20.280 numbers of quits each month, they're finding it harder than 0:04:20.279 --> 0:04:22.359 ever to hang onto the workers they've got. There are 0:04:22.360 --> 0:04:25.160 a bunch of reasons that's happened. The switch to remote 0:04:25.160 --> 0:04:27.400 work rise and remote work is a big, big reason. 0:04:27.760 --> 0:04:31.120 It means that jobs switching costs are much much lower. 0:04:31.320 --> 0:04:33.359 You can leave the job now and stay in the 0:04:33.400 --> 0:04:36.200 same industry, in the same occupation, while staying in the 0:04:36.240 --> 0:04:38.600 same room without having to disrupt your family and up reason. 0:04:39.200 --> 0:04:41.800 We certainly see that in the Jolts data often in 0:04:41.960 --> 0:04:44.839 terms of how that plays out. What's interesting is what 0:04:44.880 --> 0:04:47.400 else do you see? I mean, you guys have a 0:04:47.440 --> 0:04:48.960 lot of data that's in front of you as people 0:04:49.000 --> 0:04:52.000 are searching and looking and tone and so forth. What 0:04:52.200 --> 0:04:55.480 is it that's interesting about the trends um also in 0:04:55.480 --> 0:05:01.560 this particular employment environment. So one exciting trend is that 0:05:01.600 --> 0:05:04.160 we are seeing this full and healthy return of the 0:05:04.240 --> 0:05:07.679 labor market. Today's numbers notwithstanding, uh, you know, the entire 0:05:07.800 --> 0:05:10.840 household survey portion of the report today was a bit 0:05:10.839 --> 0:05:13.440 of a doozy. Everything went down in the household report, 0:05:13.680 --> 0:05:17.039 even the employment level. That's just not consistent with twenty 0:05:17.080 --> 0:05:19.479 eight non farm payroll gains. So I think we should 0:05:19.480 --> 0:05:23.000 discount the household report today. What we've been seeing over 0:05:23.279 --> 0:05:26.480 a longer period is a sustained return of workers to 0:05:26.520 --> 0:05:29.560 the labor force. UH. That is exciting there seeing the 0:05:29.600 --> 0:05:33.359 search behavior pick up. And then we're also seeing this 0:05:33.760 --> 0:05:37.159 sustained interest in remote work and that's causing employers to 0:05:37.160 --> 0:05:40.240 have to adjust what they're offering and to lean into 0:05:40.360 --> 0:05:43.400 the hybrid remote model. Julia, was there anything just in 0:05:43.440 --> 0:05:45.640 the last forty seconds that we have with you, was 0:05:45.680 --> 0:05:48.640 there anything in this report that you didn't see coming 0:05:48.680 --> 0:05:50.640 based on the data that you have on the ZIP 0:05:50.720 --> 0:05:55.280 recruiter platform, Like, was anything a surprise in here? Yes? 0:05:55.640 --> 0:06:00.960 I was surprised to see the uptick in government tie airing. Uh. 0:06:01.080 --> 0:06:05.239 That is an area where we've seen tremendous weakness. Government 0:06:05.279 --> 0:06:10.000 agencies are seeing terrible retention numbers at the moment. The 0:06:10.080 --> 0:06:14.040 private sector is posting much stronger wage games. Non unionized 0:06:14.040 --> 0:06:16.960 workers are getting stronger wage games than unionized workers, So 0:06:17.040 --> 0:06:19.400 the government is struggling to catch up. But it looks 0:06:19.400 --> 0:06:23.600 like they might be turning the tide around. That's interesting 0:06:23.640 --> 0:06:25.480 to see. It is always so good to dig into 0:06:25.520 --> 0:06:27.960 the different sectors and see what they're seeing. Hey, Julia, 0:06:28.000 --> 0:06:29.919 thank you so much. Have a great weekend. Julia Pollock, 0:06:30.240 --> 0:06:32.960 she's a chief Economisturan CIP recruiter. On the phone from 0:06:32.960 --> 0:06:36.479 Santa Monica, California, where the Senoi signs. You're listening to 0:06:36.560 --> 0:06:40.520 Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes. 0:06:40.640 --> 0:06:44.480 Tim Stinovic on Bloomberg Radio. Just ment to the Cynthia 0:06:44.520 --> 0:06:47.839 Coon's story that is in Bloomberg Business Week magazine about 0:06:47.839 --> 0:06:49.760 the abortion pill. We want to get to another story 0:06:49.800 --> 0:06:51.960 that's in the new issue a Business Week, which is 0:06:52.000 --> 0:06:54.080 out on newsstands, online, and of course always on the 0:06:54.080 --> 0:06:56.719 Bloomberg terminal. You know, we've been following and Charlie's been 0:06:56.720 --> 0:06:59.320 talking about shares of Zelo, which are tumbling today start 0:06:59.360 --> 0:07:03.520 getting a two year low after putting out a disappointing outlook. 0:07:03.680 --> 0:07:05.400 We've got a great story that's in the magazine that 0:07:05.440 --> 0:07:08.359 actually looks at the CEO of Zillo. We're talking about 0:07:08.400 --> 0:07:11.760 the CEO Rich Barton. Patrick Clark is real estate reporter 0:07:11.840 --> 0:07:14.080 for Bloomberg News. He's with us now in the Bloomberg 0:07:14.120 --> 0:07:16.880 Interactive Broker Studio. Pat story featured in the new issue 0:07:16.880 --> 0:07:19.960 of Bloomberg Business Week magazine. It is available on news stands, 0:07:19.960 --> 0:07:23.080 on the Bloomberg and at Bloomberg dot com Slash business Week. 0:07:23.120 --> 0:07:26.160 Also joining us is Joel Webber, the editor of Bloomberg 0:07:26.200 --> 0:07:29.800 Business Week. He is joining us on the access line 0:07:29.880 --> 0:07:32.800 right now, Joel, I want to go to you first, Um, 0:07:33.000 --> 0:07:36.720 B Hag. Explain what the hag is. I've never heard 0:07:36.760 --> 0:07:39.960 of it before reading Rich's story. Yeah, Bi, hag is 0:07:39.960 --> 0:07:42.120 certainly one place we could start, and I think I'll 0:07:42.120 --> 0:07:45.480 get there with with Pat's help. But you know, to 0:07:45.600 --> 0:07:48.680 back up a second. You know, Zillo was and has 0:07:48.720 --> 0:07:52.560 been an app and website that people have been obsessed 0:07:52.600 --> 0:07:56.119 with for on the real estate front for years. Um, 0:07:56.200 --> 0:07:59.360 what maybe the company especially interesting within the last couple 0:07:59.360 --> 0:08:02.800 of years was this effort to get into house flipping, 0:08:03.200 --> 0:08:05.920 and so Zilo, looking for growth, sort of became the 0:08:05.920 --> 0:08:09.680 intermediary that was hoping to like actually and and did 0:08:09.720 --> 0:08:12.200 actually buy houses, and then you would actually buy a 0:08:12.240 --> 0:08:16.320 house from Zillo and as Pat, Pat basically broke these 0:08:16.360 --> 0:08:20.200 stories about Zillo's algorithms starting to go off the rails. 0:08:20.840 --> 0:08:23.520 Um and that started sort of happening last year, and 0:08:23.720 --> 0:08:26.200 so this story is sort of the culmination of a 0:08:26.200 --> 0:08:29.040 lot of Pats reporting and he got to spend some 0:08:29.080 --> 0:08:33.120 exclusive time with the CEO and talk to him about 0:08:33.320 --> 0:08:36.200 those efforts and what the heck is a b hag. 0:08:38.240 --> 0:08:43.520 It's a big, hairy, audacious goal. It's obviously, um, it's 0:08:43.559 --> 0:08:46.400 it's a moonshot. It's a it's a you know, a 0:08:46.400 --> 0:08:49.400 big swing. Um. Those are things we hear about, though, 0:08:49.440 --> 0:08:51.679 like moonshots or that's like, you know, common in the 0:08:51.880 --> 0:08:55.360 vernacular is like it's a it's like a nine early 0:08:55.440 --> 0:08:59.280 nineties formulation from Jim Collins is sort of management guru, 0:08:59.440 --> 0:09:03.160 built good to grade and built to last and and 0:09:03.160 --> 0:09:05.600 and you don't at some point, uh So Rich Barton, 0:09:05.640 --> 0:09:08.600 the CEO of Zello, likes he likes the phrase b hag. 0:09:08.600 --> 0:09:12.000 Where others say moon shot, he says be had very often. 0:09:12.000 --> 0:09:13.960 At some point I did check the terminal to see 0:09:14.400 --> 0:09:17.160 how many other quarterly earnings calls be hag has come 0:09:17.200 --> 0:09:19.640 up or big Harry Auday shows, and it's very very seldom. 0:09:19.720 --> 0:09:24.480 It's it's it's basically the other No. I didn't well 0:09:24.480 --> 0:09:27.080 what does it mean in terms of how he runs 0:09:27.080 --> 0:09:29.079 this company and how he thinks about, you know, taking 0:09:29.200 --> 0:09:31.800 risks and when it pays off and when it doesn't. 0:09:32.200 --> 0:09:34.600 The way I think about it, it's it's a way 0:09:34.640 --> 0:09:40.079 that he sort of marshals his employees to pursue something ambitious. 0:09:40.160 --> 0:09:43.560 And in this case, it was transforming Zillo from a 0:09:43.559 --> 0:09:46.640 company that basically sold ads to real estate agents to 0:09:46.679 --> 0:09:49.559 a company that bought houses and tried to capture sort 0:09:49.600 --> 0:09:51.920 of a spread on the flip of each house. And 0:09:51.960 --> 0:09:54.560 then I thought it could attach all these other revenue 0:09:54.600 --> 0:09:57.600 streams to that. And it's not a small effort, right, 0:09:57.600 --> 0:09:59.920 I mean, there's there's um you have to know why 0:10:00.120 --> 0:10:02.160 home prices are going to be now what they are 0:10:02.200 --> 0:10:05.040 in three months from now, which nobody knows. You've got 0:10:05.040 --> 0:10:07.800 to manage portfolio risk like you're a hedge fund and 0:10:07.920 --> 0:10:10.520 you've got to manage a contractor. Network was actually going 0:10:10.559 --> 0:10:13.320 in and pulling up old carpet in and putting up paint, 0:10:13.360 --> 0:10:15.800 you know, all stuff that Zello, all stuff that Zillo 0:10:15.840 --> 0:10:19.400 hadn't done. Go ahead, joll Yeah, So this was Zillo offers, right, 0:10:19.440 --> 0:10:23.000 and it was uh, you know, pat, where where was 0:10:23.040 --> 0:10:27.520 it most successful and what what went wrong? And how 0:10:27.559 --> 0:10:30.600 did uh when it went wrong? How did rich feel 0:10:30.640 --> 0:10:33.320 about it all? Well, everybody loved them and not everybody 0:10:33.360 --> 0:10:37.000 love this. What I should say is, um, it was successful. 0:10:37.160 --> 0:10:40.800 I mean it found a consumer audience. People wanted to 0:10:40.800 --> 0:10:43.080 pay Zello for this service. Now. One of the reasons 0:10:43.080 --> 0:10:45.360 people wanted to pay Zello Zillo was sort of giving 0:10:45.400 --> 0:10:49.760 it away, right, I mean, Zillo was buying homes at 0:10:49.760 --> 0:10:52.960 some point in the second half of last year for 0:10:53.040 --> 0:10:56.040 you know, on average twenty dollars or more than it 0:10:56.080 --> 0:10:58.440 could eventually sell the homes for. So Zello would you know, 0:10:58.480 --> 0:11:00.880 you'd go on zillo dot com. You'd say, make me 0:11:00.920 --> 0:11:03.320 an offer on my house. They would offer you something. 0:11:03.400 --> 0:11:05.720 You would say, well, that looks like thirty thou dollars 0:11:05.720 --> 0:11:08.679 more than I could sell it for right now, and 0:11:08.720 --> 0:11:11.680 that's awesome. What to do it? And so okay, So 0:11:11.720 --> 0:11:13.560 they were successful in buying a lot of houses, and 0:11:13.559 --> 0:11:16.440 they you know, in a in a long term sense, 0:11:16.440 --> 0:11:17.920 they thought they needed to buy a lot of houses 0:11:17.960 --> 0:11:21.240 to get the scale to make this business work. Um. 0:11:21.440 --> 0:11:24.480 As Zillo started to realize and as Barton started to 0:11:24.520 --> 0:11:27.840 realize what had gone down, which is that they had 0:11:28.040 --> 0:11:31.199 you know, overpaid by four d million dollars or so 0:11:31.400 --> 0:11:35.240 for for ten thousand houses or twenty thou houses. Um. 0:11:36.120 --> 0:11:39.720 He said, well, hold on, maybe this isn't um, you know, 0:11:39.800 --> 0:11:41.760 the key to transform in my business into a much 0:11:41.760 --> 0:11:45.320 bigger company and solving consuper problems. Maybe I'm about to 0:11:45.320 --> 0:11:51.760 blow up and um and he thought about it, and 0:11:51.840 --> 0:11:53.880 he said, maybe it'd be better not to do this. 0:11:55.360 --> 0:11:57.800 You know, you bed, you gotta be willing to pull 0:11:57.840 --> 0:11:59.800 the plug on it. Sometimes, you know, you take a 0:11:59.800 --> 0:12:02.080 big swing and sometimes you miss, and you and you 0:12:02.120 --> 0:12:04.480 try to move on from it. And you know what 0:12:04.600 --> 0:12:07.679 Rich has done when Zillo is done is um. You know, 0:12:08.200 --> 0:12:09.960 they sort of took their medicine at the end of 0:12:10.040 --> 0:12:13.480 last year and and um and and and they came 0:12:13.520 --> 0:12:17.240 back out with a new b HAG because that's what well, 0:12:17.400 --> 0:12:19.439 let's talk about that, because I'm wondering where Zillo goes 0:12:19.440 --> 0:12:21.880 from here. You write about the destruction and the value 0:12:22.080 --> 0:12:24.160 of Zillo at least in the on the public markets. 0:12:24.240 --> 0:12:27.680 It's down more than from highs back in February of 0:12:27.760 --> 0:12:30.080 last year. What's next for the company. How's it trying 0:12:30.080 --> 0:12:32.920 to turn itself around? So they at the end of 0:12:32.920 --> 0:12:34.520 the day. They want to do more than just sell 0:12:34.559 --> 0:12:37.360 ads to real estate agents. That's that's a limited business. 0:12:37.400 --> 0:12:39.920 They need a bigger business, okay, And so they did 0:12:39.920 --> 0:12:44.560 what they decided was, um, they still want to They're 0:12:44.559 --> 0:12:46.200 still gonna do some of that. They're going to change 0:12:46.240 --> 0:12:48.320 their revenue model around it. They want to be a 0:12:48.320 --> 0:12:50.959 mortgage lender. Um, they want to. There are these more 0:12:51.120 --> 0:12:54.200 new kinds of mortgage products, basically new kind of bridge loan, 0:12:55.000 --> 0:12:57.160 you know, to help you make a cash offer on 0:12:57.200 --> 0:12:58.560 a house so you don't get beat out by an 0:12:58.600 --> 0:13:02.199 investormer somebody who's got stock options or family money to 0:13:02.240 --> 0:13:05.520 buy a house with. And so they're gonna do all 0:13:05.520 --> 0:13:08.480 of that. And the way they've organized that, they say 0:13:08.480 --> 0:13:11.840 they're gonna they call it a super app for housing 0:13:12.160 --> 0:13:14.839 and you know, go on your phone and manage the 0:13:14.840 --> 0:13:17.800 whole transaction. And uh, they still you know, so it 0:13:17.880 --> 0:13:20.400 came out and said, well, we're gonna double, we're gonna 0:13:20.440 --> 0:13:22.719 double our revenue, we're gonna increase our conversion rates and 0:13:22.760 --> 0:13:24.240 so forth and so on. So it's the new it's 0:13:24.280 --> 0:13:28.520 the new bi HAG. It's not as tangible as we're 0:13:28.520 --> 0:13:31.400 going to transform the company and buy and sell five 0:13:31.440 --> 0:13:33.960 thousand houses a month. It's a little harder to kind 0:13:33.960 --> 0:13:36.960 of get your head around, but nonetheless they've set a 0:13:36.960 --> 0:13:41.080 new target for themselves. Okay, Pat, last thought, can you 0:13:41.080 --> 0:13:45.080 tell us about the moat? And just got about Sure, 0:13:45.160 --> 0:13:47.839 there's Enrich's office on the forty floor of a tower 0:13:47.960 --> 0:13:51.400 in downtown Seattle. When you walk in through the front 0:13:51.679 --> 0:13:54.360 sort of door of the office, there's a there's there's 0:13:54.360 --> 0:13:56.400 a moat, a pool of water that you crossover. And 0:13:56.520 --> 0:13:58.199 Rich told me he was going a little bit cheapishly. 0:13:58.200 --> 0:14:00.800 He was like, well, somebody told me once that crossing 0:14:00.880 --> 0:14:03.800 water makes people feel like they're leaving their troubles behind them. 0:14:03.960 --> 0:14:06.920 And I was designing my office at the time, and 0:14:06.960 --> 0:14:08.960 so I decided to put this here. We need one 0:14:09.000 --> 0:14:10.880 for the studio, Carol, we do have a fish pond 0:14:10.920 --> 0:14:12.960 when you walk in. I'm just gonna it's not exactly 0:14:12.960 --> 0:14:15.680 a mode here at Bloomberg, but end of the same theory, 0:14:16.840 --> 0:14:20.680 it does like troubles behind when I enter work. Oh man, 0:14:20.880 --> 0:14:23.440 b hag, I'm going to start using that around here. 0:14:23.480 --> 0:14:25.920 What do you think? Sure, go ahead the next management meeting. 0:14:25.920 --> 0:14:28.720 I've got an idea. Let's see how that goes. Yeah, 0:14:28.720 --> 0:14:31.920 I wouldn't see how that goes um such fun and 0:14:32.000 --> 0:14:34.760 such great reporting. Patrick Clark, real estate reporter at Bloomberg News. 0:14:34.760 --> 0:14:37.400 Here in studio. Joe Weber, editor of Bloomberg Business Week, 0:14:37.640 --> 0:14:39.640 on the Access line in Brooklyn. Check out this story. 0:14:39.640 --> 0:14:42.280 It is in the new issue of the magazine online 0:14:42.280 --> 0:14:46.760 on the Bloomberg. You're listening to Bloomberg Business Week with 0:14:46.880 --> 0:14:51.680 Carol Messer and Bloomberg Quick Takes. Tim Stinovic on Bloomberg Radio. 0:14:52.280 --> 0:14:54.560 Speaking of someone who's not quite on the West Coast. 0:14:54.560 --> 0:14:56.720 He spends a lot of used to be right. He 0:14:56.800 --> 0:14:59.120 used to call that home. Hasn't for a while. We're 0:14:59.120 --> 0:15:01.400 talking about Elon us. This story, by the way, among 0:15:01.440 --> 0:15:04.160 the most right on the Bloomberg. It's about Elon Musk's 0:15:04.160 --> 0:15:07.320 fixer who is quietly tending the world's biggest fortune. Leanna 0:15:07.360 --> 0:15:09.240 Baker is one of the authors on that story. She's 0:15:09.280 --> 0:15:12.160 Deal's team leader for Bloomberg News. She joins us on 0:15:12.200 --> 0:15:15.440 the phone from New York. Lenna tell us about the 0:15:15.480 --> 0:15:19.640 man behind the man, who is Jared Birchall. So, Jared 0:15:19.720 --> 0:15:22.640 Birchall has been working with Elon Musk for the past 0:15:22.640 --> 0:15:25.720 six years. He's a former Wall Street Guy he started 0:15:25.760 --> 0:15:28.520 his career at Goldman Sachs. Then he worked at Meryl 0:15:28.600 --> 0:15:31.080 where he was fired. Finally he found a home at 0:15:31.120 --> 0:15:35.040 Morgan's family, which is where he started to sort of 0:15:35.080 --> 0:15:37.760 manage wealthy clients and he had a knack for it. 0:15:37.840 --> 0:15:40.960 And certainly that's uh, you know, come in handy here 0:15:41.040 --> 0:15:44.120 with Elon Musk trying to buy Twitter and all sorts 0:15:44.120 --> 0:15:47.360 of different projects that he's put Jared Burchell on. And 0:15:47.400 --> 0:15:51.280 he's also the only employee, it seems, of the family office. 0:15:51.400 --> 0:15:53.720 So for the world richest man, that is a tall order. 0:15:54.200 --> 0:15:57.160 So it's so interesting. I feel like with Elon Musk's universe, right, 0:15:57.240 --> 0:16:00.040 he is certainly the face and all things he's on 0:16:00.160 --> 0:16:02.000 Musk in his world. But then we start to quietly 0:16:02.080 --> 0:16:05.720 find out about these really smart individuals who are behind 0:16:05.760 --> 0:16:09.280 the scenes where they're at SpaceX or whether it's Tessa 0:16:09.600 --> 0:16:11.880 you know, Um, did you have to do a lot 0:16:11.880 --> 0:16:13.880 of digging or did the company say, hey, maybe you 0:16:13.880 --> 0:16:16.480 want to write about this dude, especially with everything that's 0:16:16.520 --> 0:16:18.360 going on, and I think people are worried about, you know, 0:16:18.400 --> 0:16:20.320 Elon Musk, can he take another thing, you know, put 0:16:20.360 --> 0:16:23.640 another thing on his plate? Um, My colleague on the 0:16:23.680 --> 0:16:26.480 Wealth team. Sophie Alexander did a lot of a heavy 0:16:26.480 --> 0:16:28.680 listing and a lot of the digging and to filings 0:16:28.720 --> 0:16:31.560 to find out more about Jared Burchell. I'm more the 0:16:31.600 --> 0:16:34.760 person that talked to Wall Street and M and A professionals, 0:16:34.840 --> 0:16:38.280 And from what I understand, h Virtill is very much 0:16:38.360 --> 0:16:41.360 in the inner circle and he was instrumental at putting 0:16:41.400 --> 0:16:43.680 together as a Twitter bid. He was sort of the 0:16:43.720 --> 0:16:47.400 face in front of the banks and helped coral them 0:16:47.440 --> 0:16:50.120 along with the help of his former employer, Morgan Stanley, 0:16:50.720 --> 0:16:53.680 to get Musk the money, uh to do this deal. 0:16:53.960 --> 0:16:57.560 So he's really a key person here. What do we 0:16:57.600 --> 0:17:00.520 know about just the way he just his career and 0:17:00.720 --> 0:17:03.400 and what he does. And it's interesting because he's sort 0:17:03.400 --> 0:17:07.159 of the antithesis of Musk in some senses. You and 0:17:07.240 --> 0:17:10.760 Sophie in the story compare and contrast the two men, 0:17:10.840 --> 0:17:14.800 and note that, uh that Birchall is part of the 0:17:14.840 --> 0:17:17.800 Mormon Church and went to b y U and has 0:17:17.920 --> 0:17:20.320 kids and is married, whereas Elon Musk, you know as 0:17:20.400 --> 0:17:23.159 seven kids, has been divorced three times, and there are 0:17:23.200 --> 0:17:26.120 a lot of differences between the two of them. For sure, 0:17:26.200 --> 0:17:28.520 Sometimes you need someone to kind of balance you out, 0:17:28.560 --> 0:17:31.400 and as a Mormon family man who's very much out 0:17:31.440 --> 0:17:34.280 of the headlines and stuff from the story today, Burchill 0:17:34.320 --> 0:17:38.840 definitely serves that role for musque Um. People I spoke 0:17:38.920 --> 0:17:43.000 to who know him just describes him as very nice. Uh. 0:17:43.119 --> 0:17:46.000 He just you know, gets things done. Even though he 0:17:46.040 --> 0:17:50.560 didn't have experience putting together multibillion dollar deals for big 0:17:50.560 --> 0:17:54.439 Internet companies like Twitter, he made it happen. Being a 0:17:54.480 --> 0:17:58.639 manager of a family office also involved taking on odd jobs. 0:17:58.640 --> 0:18:01.800 Apparently he's in charge arch of helping us get nanny's 0:18:01.920 --> 0:18:05.200 for all his kids. So it's not a job for everyone, 0:18:05.280 --> 0:18:08.120 but virtual certainly you know, fits the bill here well. 0:18:08.119 --> 0:18:13.159 And I do think about you know, Ellen's relationship with 0:18:13.200 --> 0:18:15.399 the financial community, especially as he's trying to do this 0:18:15.600 --> 0:18:17.560 Twitter deal and right over the last week or so, 0:18:17.680 --> 0:18:19.840 we keep getting more pieces about it. It It really looks 0:18:19.840 --> 0:18:21.840 like he has lined up so much of it. But 0:18:21.880 --> 0:18:24.479 I do wonder about having someone like Bertill, you know, 0:18:24.760 --> 0:18:28.480 who worked on Wall Street, understands the financial community, Like, what, 0:18:28.760 --> 0:18:33.440 how does the financial community see this dude? Right? So 0:18:33.480 --> 0:18:37.080 he was definitely someone who's coordinating behind the scenes. Let's 0:18:37.080 --> 0:18:39.720 say he would come on a video call first to 0:18:39.840 --> 0:18:42.199 say okay, I'm you know, I'm getting Ellen next on 0:18:42.240 --> 0:18:45.600 the call. But Virtu will be the first person you see. Um, 0:18:45.720 --> 0:18:48.200 he's the one with Tyson Morgan Stanley, as I mentioned 0:18:48.200 --> 0:18:51.320 as a former employee. But I also heard that he's 0:18:51.359 --> 0:18:54.680 just a nice guy and he's not going beyond his capabilities. 0:18:54.720 --> 0:18:58.240 He'll rely on experts and help hire people to bring 0:18:58.280 --> 0:19:00.439 them in to do what has to be done for 0:19:00.600 --> 0:19:04.280 Mosque's financial empire. Lea, this is he's managing the family 0:19:04.280 --> 0:19:06.960 office of the world's wealthiest person within churring sixty billion 0:19:07.000 --> 0:19:10.280 dollar net worth? How much billion dollar net worth? I 0:19:10.320 --> 0:19:12.840 mean most of us tied up in tesla. Take a tesla. 0:19:12.880 --> 0:19:15.520 As you guys write, Um, how lucrative is this? Is 0:19:15.560 --> 0:19:17.320 this for someone like birch Ally? You do? You mentioned 0:19:17.359 --> 0:19:19.000 the story that about a two point five million dollar 0:19:19.040 --> 0:19:21.359 home in Dallas, But you know we're talking We're not 0:19:21.400 --> 0:19:24.520 talking tens of millions of dollars yet. Maybe so we 0:19:24.560 --> 0:19:27.080 don't have any filings or anything to show what a 0:19:27.119 --> 0:19:30.320 salary is, but we do know that, UM, managing a 0:19:30.359 --> 0:19:32.440 family office could be very lucrative, as you can make 0:19:32.880 --> 0:19:35.320 millions a year. One expert set up to three million. 0:19:35.760 --> 0:19:39.840 But considering he's one of very few employees for the 0:19:39.840 --> 0:19:43.480 world's richest man's family office. Uh yeah, but you know, 0:19:43.560 --> 0:19:46.480 the sky's the limit. Some billionaires family offices have a 0:19:46.560 --> 0:19:50.240 hundred employees, and uh, you know, Musk only has one 0:19:50.359 --> 0:19:53.400 or two. So um, he's really the only guy sais 0:19:53.400 --> 0:19:55.040 there's someone to pay, it would be him, But again 0:19:55.080 --> 0:19:56.920 we don't have the reporting to show what he's making. 0:19:57.160 --> 0:19:59.560 I do feel like it's Ellen's world and we're all 0:19:59.600 --> 0:20:01.600 just living in it. That's because that's because you spent 0:20:01.640 --> 0:20:05.640 so much time on Twitter. It's so true. Utlianna, thank 0:20:05.680 --> 0:20:08.120 you so much, really appreciated. Leanna Baker. She is Deal's 0:20:08.119 --> 0:20:15.800 team leader of Bloomberg News. I'm roc journal. Yeah, but 0:20:15.920 --> 0:20:21.000 you let me drive. No, no, no no, honey, please, I'll 0:20:21.040 --> 0:20:26.600 do the riding gravels. I want to drive. It's a 0:20:26.640 --> 0:20:32.520 good question. Good drive. This is the drive to the 0:20:32.560 --> 0:20:39.000 clothes thin well driver Don on Bloomberg Radio. All right, TikTok, 0:20:39.080 --> 0:20:42.200 it's just about ten minutes left in today's trading session. 0:20:42.240 --> 0:20:46.000