Speaker 1: This is Bloomberg Business Week. I'm Carole Masser and I'm
Speaker 1: Bloomberg Quick Takes Tim Stanovk. We're here every day bringing
Speaker 1: you the latest news from the world to business and finance,
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Speaker 1: You can also listen to our radio show at two
Speaker 1: pm Eastern Time on Bloomberg Radio or watch us on
Speaker 1: YouTube search Bloomberg Global News. You know, I just said
Speaker 1: to Tim, I'm looking at We've got a bunch of screens,
Speaker 1: TV screens up different networks and just different headlines when
Speaker 1: it comes to this delta variant and the spread, you know,
Speaker 1: whether or not you've got the vaccine, it's very hard
Speaker 1: to make sense of what is the true story it
Speaker 1: is And I'm afraid, like Dr Adlga told us earlier
Speaker 1: this week from John's Hopkins, that there are there's not
Speaker 1: widespread agreement in the medical community with the way that
Speaker 1: the CDC has done and about face, you know, and
Speaker 1: he was a lot more aggressive about like you don't
Speaker 1: need to wear your masks if you're vaccinated. And yet
Speaker 1: a colleague of his, who I also heard on Bloomberg
Speaker 1: this morning, dr Andy Pekash, talked about I'm wearing my mask.
Speaker 1: That just shows where the experts are right now, a
Speaker 1: lot of confusion waiting for the data. Well, we have
Speaker 1: another expert for you, dr Ian las bad Or. He's
Speaker 1: clinical professor of medicine at n y U land On
Speaker 1: Medical Center. He is back with us on the phone
Speaker 1: from Long Island. Uh. Ian, nice to have you back
Speaker 1: with us. It is kind of a confusing time. We
Speaker 1: all felt so safe and secure having gotten our vaccine,
Speaker 1: and now it's we're trying to say, well, wait, I
Speaker 1: have to put my mask on. How do you explain
Speaker 1: it to patients who probably have a million questions for you?
Speaker 1: There are happy for the guys, Thanks for having me
Speaker 1: as usual, Yes, people are. There's definitely a lot of
Speaker 1: turmoil in the air from UH, from patients and and
Speaker 1: just people out there. And part of that it's because
Speaker 1: we are seeing people who have been vaccinated coming down
Speaker 1: with delta. And we do know from Israel, for example,
Speaker 1: that a significant percent of patients who have been vaccinated
Speaker 1: uh twice with the Fiser vaccine have come down with
Speaker 1: the delta infections. So clearly we're seeing that there's this
Speaker 1: breakthrough and that the vaccines also very helpful are not
Speaker 1: And that's really the same story with masks. UM. The
Speaker 1: reason there's a bit of a debate is because there
Speaker 1: are different kinds of masks. There are these surgical masks
Speaker 1: and of course the N nine masks which seal very
Speaker 1: close to the face. But a number of different studies
Speaker 1: do show that masks seem to reduce respiratory droplets. We
Speaker 1: think the way the delta and and all viruses and
Speaker 1: bacteria for that matter, transmit are through respiratory droplets. When
Speaker 1: people call for sneeze or talk hi. There are these
Speaker 1: droplets that aren't caught by some masks, even cloth masks
Speaker 1: UM although the viral particles themselves are very tiny and
Speaker 1: you know, go right through any mask really other than
Speaker 1: an and that's effective. So a lot of these studies
Speaker 1: show masks seems to block about these respiratory droplets. Not
Speaker 1: it does seem to reduce the risk in that range
Speaker 1: of fifty. So they're not perfect, but they're really one
Speaker 1: arm of presntion and treatments strategy. Uh that's really why
Speaker 1: they have been debates. And you know, the virus is accelerating,
Speaker 1: it's really galloping faster than we can vaccinate people. And
Speaker 1: so are you seeing in your hospital? Are you seeing
Speaker 1: at your hospital? No, you know New York we are
Speaker 1: seeing an increase, but really in the Northeast, I think
Speaker 1: we're really very close to her immunity. Uh so, I
Speaker 1: think we're not seeing that same volume. But what I
Speaker 1: am seeing are people who have been vaccinated coming down
Speaker 1: with a delta. A small percent, maybe ten percent, is
Speaker 1: kind of in the range that we're seeing tends to
Speaker 1: be mild up respiratory coughs, sneezing, you know, sore throat um.
Speaker 1: But clearly the vaccines are not They're not. But what
Speaker 1: we do know is they prevent severe illness and they
Speaker 1: prevent death. And the vast majority of people who are
Speaker 1: hospitalized with COVID with the delta variant that CDC has
Speaker 1: said those people are unvaccinated. I do wonder though about
Speaker 1: long COVID dr LUs Vader do we know anything about
Speaker 1: do we have any data about the way that people
Speaker 1: who have been vaccinated do end up getting infected with
Speaker 1: a breakthrough infection, it's perhaps not severe. Do we know
Speaker 1: anything about long COVID and to what extent they could
Speaker 1: suffer from it? Tim Those are all excellent points. So
Speaker 1: one point you know that you made is that the vaccines,
Speaker 1: despite some data about um, you know, potential side effects
Speaker 1: a small number of patients, we don't have really long
Speaker 1: term data, but we certainly know that they are really
Speaker 1: one of the most effective tools we have since we
Speaker 1: don't have great anti viral treatment. The vaccines do seem
Speaker 1: to be very helpful in preventing severe disease. The vast
Speaker 1: majority of patients who are hospitalized have not been vaccinated,
Speaker 1: which is another uh bit of data you know. And
Speaker 1: long COVID is something that we worry about both in
Speaker 1: patients who have had it. It's estimated up to a
Speaker 1: third of people who have had COVID have ongoing symptoms
Speaker 1: chest pain, costs, uh, brain fog, fatigue. So, uh, that's
Speaker 1: a real problem and we don't really know how that's
Speaker 1: going to play out over a longer period of time.
Speaker 1: We also don't have great treatment for long COVID or
Speaker 1: the long blowlers. There's some evidence that people who have
Speaker 1: had or who have long COVID when they're vaccinated, have
Speaker 1: some improvement in their symptoms, which we do see chronic
Speaker 1: infections epstein bar and other infections that really are chronic
Speaker 1: after the patient gets over the you illness, that maybe
Speaker 1: what we're seeing with long COVID. Charlie Pellet is sharing
Speaker 1: with me a story from our own Matthew Boyle here
Speaker 1: on the Bloomberg Walmart, the largest private employer in the USA,
Speaker 1: is requiring its headquarters in regional staff to be vaccinated
Speaker 1: by October four, joining Google and instituting a policy that
Speaker 1: other big companies may seon follow as the delta variant
Speaker 1: continues to spread. This has been something we've been hearing
Speaker 1: debated about whether or not private employers should be forcing
Speaker 1: or or requiring their's teams and employees to get the vaccine.
Speaker 1: And if you don't, you don't have a job. And
Speaker 1: we're increasingly tim saying more that happening. We're seeing it
Speaker 1: not just in the private sector, but we're also seen
Speaker 1: in the public sector as well, with President Biden making
Speaker 1: rules such as those, and then also here in New
Speaker 1: York City with Mayri Di Blasio. Let's get right back
Speaker 1: to Dr Ian LUs Better, clinical Professor of Medicine at
Speaker 1: n y U Langes Medical Center. He joins us each
Speaker 1: and every Friday. Today he's on the phone from Long Island.
Speaker 1: Dr LUs Better, you probably heard Carol and I talking
Speaker 1: about this medication the FDA certified in is called I'm
Speaker 1: gonna let you thank you. We're not we're not doctors. UH.
Speaker 1: This is this is a medicine though that's right now
Speaker 1: controversial because the FDA has put out a special warning
Speaker 1: that you shouldn't use it to prevent or treat COVID nineteen.
Speaker 1: Bring us all up to speed on what's happening from
Speaker 1: the treatment front with this. So there was a recent
Speaker 1: article op ed in the Wall Street Journal UH calling
Speaker 1: attention to ivermicton, which has been around UH for a
Speaker 1: number of years as an anti parasitic drug, certainly used
Speaker 1: in veterinary medicine as well, and it really highlights the
Speaker 1: need for us to hopefully do more than just vaccinate people,
Speaker 1: but have hopefully treatment options. UM. There are a number
Speaker 1: of physicians, critical care physicians that are very enthused about
Speaker 1: this medication and it may have potential. What we're really
Speaker 1: lacking are large studies that are unfortunately usually funded by
Speaker 1: drug companies who stand to make a lot of money
Speaker 1: from these things. And so we have a number of
Speaker 1: smaller studies from around the world. They've been put together
Speaker 1: in a meta analysis, and there's some encouraging data on it.
Speaker 1: What we really need are controlled, randomized, double blind, controlled
Speaker 1: studies so that if this medication or other medications that
Speaker 1: may work in a similar way, Uh, we really need
Speaker 1: data that would convince people and physicians to use it.
Speaker 1: At this point, it's certainly if it is being used,
Speaker 1: it's being used off label. UM. And I think that's
Speaker 1: highlights that there may be other treatments out there that
Speaker 1: we do need to pursue. Uh. We do need more
Speaker 1: studies on this drug and it may turn out to
Speaker 1: be very effective. It is used in other countries, uh,
Speaker 1: and with some encouraging data. But that's that's really all
Speaker 1: I would say on that, and that's something we need
Speaker 1: to be aware of. It also highlights to me that
Speaker 1: we really need a coherent strategy we need when you
Speaker 1: go to other countries, you have to show a vaccination
Speaker 1: record or antibody tighters. You know, we need to have
Speaker 1: a little better control of our borders so that immigrants,
Speaker 1: legal illegal Southern border or travelers to our country have
Speaker 1: some documentation of vaccination or antibodies, or vaccinate them before
Speaker 1: they come in. We need to have our vaccines approved
Speaker 1: by the FDA. They're still under emergency use, and I'm
Speaker 1: sure there's some hesitancy that people have because they're not
Speaker 1: FDA approved. The FDA needs to step on that. I've
Speaker 1: actually heard people say that it's emergency use authorization. When
Speaker 1: I get full approval, I'll get the vaccine exactly exactly.
Speaker 1: I think we need to make masks available. And if
Speaker 1: we really think masks are helpful, and we get just
Speaker 1: one over the statistics that they can be helpful, let's
Speaker 1: give people the ninet, you know, better quality masks if
Speaker 1: we're in areas perhaps that have higher outbreaks. And we
Speaker 1: also need better treatments, not just monoclonal antibodies which are
Speaker 1: limited in number, for drugs like hypermectin, which may or
Speaker 1: may not be effective. We need to look into that
Speaker 1: quick question. I think part of the problem with this
Speaker 1: whole process, to be fair, is that we hear one thing,
Speaker 1: and then maybe a day later, or a week later,
Speaker 1: or two weeks later, we hear something that contradicts it.
Speaker 1: And I think the news that came out that I
Speaker 1: think the CDC publishing and I think they put the
Speaker 1: data or are putting the data out today that the
Speaker 1: concerns are that the delta variant appears to spread as
Speaker 1: easily as chicken pox and cause more severe infection. I
Speaker 1: think the narrative around it has been that it's not
Speaker 1: more severe. So is this a reminder that there's still
Speaker 1: things we don't know? Dr les Vader and so that's
Speaker 1: maybe explained some of the nervousness that's out there and
Speaker 1: just got about thirty seconds. Yeah, Look, there's no question
Speaker 1: this is evolving. The virus is evolving. The good news
Speaker 1: is that the majority of older Americans are vaccinated. That
Speaker 1: should provide a lot of protection. We're talking of people
Speaker 1: over sixty have been vaccinated. It's all good news, um.
Speaker 1: And I think that the Delta virus certainly is far
Speaker 1: more infectious, but we are not seeing that it's more deadly.
Speaker 1: It's not killing more people. The vast majority of people
Speaker 1: and young people who get this really have a bad cold.
Speaker 1: So I think we need to sort of calm down
Speaker 1: about everything, and I think we will come out in
Speaker 1: the end very well, but there's still more we could
Speaker 1: really do to to get a handle on this, and
Speaker 1: it's disappointing that we're not being more aggressive in all
Speaker 1: of these areas. Dr ian A. LUs Better, Clinical professor
Speaker 1: of Medicine at n y U Langes Medical Center. He
Speaker 1: joins us on the phone from Violand each and every Friday.
Speaker 1: Dr LUs Better, thank you. This is Bloomberg Business Week
Speaker 1: with Carol Masser and Bloomberg Quick Takes Tim Stinovic on
Speaker 1: Bloomberg Radio. Well, the new issue of Bloomberg business Week magazine.
Speaker 1: It is out. It's online at Bloomberg dot com. Slash
Speaker 1: business Week also on the Bloomberg terminal to cover Move
Speaker 1: Fast and Obey the Party China's tech crack crackdown in
Speaker 1: the making of a new model. Let's get into the
Speaker 1: issue at Bloomberg Business Week at at Ordell Webber on
Speaker 1: the Access line in Brooklyn. What a great cover story,
Speaker 1: so timely, there was more news, you know, to titel
Speaker 1: about China increasingly the oversight of some of its companies. Yeah,
Speaker 1: and I said it um when we spoke about it
Speaker 1: earlier in the week, But I think increasingly this is
Speaker 1: like one of the most important business stories of the year,
Speaker 1: and we still don't really have a sense of like
Speaker 1: where where the football, where the goal post is going
Speaker 1: to end? Uth on this right and I think that's
Speaker 1: the question on investor's mind, is that we've seen basically
Speaker 1: the upending of the old model and the symblance of
Speaker 1: a new one, but we still don't quite know what
Speaker 1: that's gonna totally look like yet. But there is no
Speaker 1: doubt about it that China wants a different version of
Speaker 1: of of of capitalism basically, you know, obviously this is
Speaker 1: that's a fraught word when we're talking about a communist
Speaker 1: country here, but like forever, they have been willing to
Speaker 1: let the West kind of, you know, kind of run
Speaker 1: the show. And now it seems like there's gonna be
Speaker 1: a perimeter that the Chinese government isn't gonna let their
Speaker 1: own their own businesses exceed Joel. As Carol mentioned, this
Speaker 1: is probably the timeliest story you could have on the
Speaker 1: cover right now, and I'm you read through it and
Speaker 1: you realize though that it it took a lot more
Speaker 1: than just a few days to actually for the for
Speaker 1: this to come together. Talk about the timing of this,
Speaker 1: how you decided on this to be the cover story,
Speaker 1: and and and kind of like how long you guys
Speaker 1: were thinking about a story like this, given that it
Speaker 1: seems like this is the perfect story for the week. Well,
Speaker 1: look like this theme has been one that's been percolating
Speaker 1: for a while. And I mean it all originated back
Speaker 1: um last year actually with with Jack mor and his
Speaker 1: comments basically as um as uh as there was about
Speaker 1: to be an I P O right, and like as
Speaker 1: that aunt group I PO happened and then um Chinese
Speaker 1: regulators basically intervened and and you know ended up um scuttling,
Speaker 1: and we at that moment we knew that something big
Speaker 1: had happened. And this effectively are or were still in
Speaker 1: the reverberations of that end because of the d d
Speaker 1: Um story and then the education story, like all of
Speaker 1: these things have been thematically linked. So when the Jack
Speaker 1: mothing happened, we obviously jumped all over it as a
Speaker 1: news organization because that was really significant. But then we
Speaker 1: kept thinking about it and talking about it internally, and
Speaker 1: so this was one of those ones that you know,
Speaker 1: we've been working on it for for weeks really, and
Speaker 1: and then you kind of just get lucky every once
Speaker 1: in a while where you're reality catches up to you,
Speaker 1: to your curiosity really and we were able to basically,
Speaker 1: you know, do do some modest updates right at the
Speaker 1: finish line. So we we were because we work with
Speaker 1: great colleagues around the world, we were really able to
Speaker 1: think ahead on this one. All right, there's something in
Speaker 1: Pursuits which is alcohol infused ice cream, which I feel like,
Speaker 1: after you read the story about the Amazon rainforest, you
Speaker 1: need to go and have an ice cream cocktail because
Speaker 1: it is really sobering. Yeah, although that's not gonna that's
Speaker 1: not gonna solve the Amazon problem, but it at least
Speaker 1: maybe take your mind off of it for a little while. Um, yeah,
Speaker 1: it's a fun one. We you know, the art team
Speaker 1: does great art and they showed me this photo a
Speaker 1: couple uh weeks ago, and I said, you know, that
Speaker 1: is just the most glorious photo that I could imagine
Speaker 1: for summer. Let's just make sure that we give it
Speaker 1: as much real estate as we can give it. So
Speaker 1: we kind of held it for a second and ends
Speaker 1: up being like the most perfect summer weekend to be
Speaker 1: thinking about booze infused ice cream and sort of some
Speaker 1: of the creations that you can go with it. And
Speaker 1: what I loved was like here in New York, you
Speaker 1: couldn't have done this, um that long ago. This is
Speaker 1: a new phenomenon that is just now gained the good graces,
Speaker 1: provided that you're of legal consumption age, of course. Exactly.
Speaker 1: All right, So talk about the Amazon rainforce story though,
Speaker 1: I mean that is it's heavy and you know, we
Speaker 1: we we talked about it a little bit yesterday. To
Speaker 1: me is um, it was just a slap across the
Speaker 1: face because you know, I think inherently that the four
Speaker 1: stations happening, that's that's a bad thing. It's a bad
Speaker 1: with the capital b um what you what I didn't
Speaker 1: appreciate how the policies in Brazil are basically baked in
Speaker 1: by the government and there it's getting way worse and
Speaker 1: we're just seeing absolute devastation. And when you think about
Speaker 1: this tipping point that we talk about the in the
Speaker 1: article where that Amazon is about to become Savannah and
Speaker 1: that it will contribute to global warming rather than what
Speaker 1: you just inherently think is that it you know, goes
Speaker 1: the other way, that it's taking carbon out of the environment.
Speaker 1: The fact that it could become a contributing element everything
Speaker 1: we know about climate change. You just sort of sit
Speaker 1: down and I think kind of have to put your
Speaker 1: head in your hands when you kind of realize that,
Speaker 1: you know, we're playing with games that are like wildly
Speaker 1: beyond our imaginations and things are starting to happen on
Speaker 1: on levels that you know, makes some of these reverberations
Speaker 1: just feel like they could get much worse. Yet I'm
Speaker 1: just a reminder that we're all connected, even if for
Speaker 1: thousands of miles away. The role that the Amazon has
Speaker 1: traditionally played has been one that really is as as
Speaker 1: we know the lungs of the world. Uh Joel Robin
Speaker 1: Hood I started trading yesterday. UH shares higher today, although
Speaker 1: it had a real lack lester day. Yesterday, shares higher
Speaker 1: by just about three three right now trading at thirty
Speaker 1: six and and change. Um Annie Moss has a story
Speaker 1: and here about the I p O bring of the
Speaker 1: broker that would the masses full circle. Talks about the
Speaker 1: incredible growth that Robin Hood saw, especially over the last
Speaker 1: eighteen months. So we um, you know, knew that uh
Speaker 1: Robin Hood was gonna I p O this weekend. I
Speaker 1: just wanted to kind of think ahead about how do
Speaker 1: we think back about what what robin Hood has changed.
Speaker 1: And that's really what any did in the story. I
Speaker 1: think it was a really good story in that you
Speaker 1: kind of forget sometimes that what robin Hood has accomplished
Speaker 1: here over the past decade is pretty remarkable. You know.
Speaker 1: One of the biggest changes is just everything got free.
Speaker 1: And when they made it free, it forced the whole
Speaker 1: ecosystem two more or less match there that that that
Speaker 1: cost and you know that that cost has been passed
Speaker 1: on to investors in other ways, um and then the
Speaker 1: other you know. One of the other things that I
Speaker 1: thought was really interesting was this idea of fractional ownership
Speaker 1: where you don't have to go out and buy a
Speaker 1: share of anything for that whole dollar amount. If you
Speaker 1: only have a dollar, you can throw that dollar at
Speaker 1: an investment, and those are you know, you can't underestimate
Speaker 1: how big of an influence that those ideas that came
Speaker 1: from Silicon Valley more than than Wall Street probably have
Speaker 1: have ended up having, i think, on the whole brokerage
Speaker 1: model and and has contributed to things like the memestock
Speaker 1: fevers that we've seen this year. It's a game changer. Hey,
Speaker 1: one last story. We just want to highlight the magazine
Speaker 1: Starbucks the new talent factory powering Corporate America. Who knew?
Speaker 1: Just got about thirty forty seconds here. Yeah, So we
Speaker 1: have a great little collection of talent based stories in
Speaker 1: this because one of the things that in general that
Speaker 1: we're seeing this race for talent, and we wanted to
Speaker 1: kind of dive into that. And there's a great story
Speaker 1: about ge hiring externally. They've not long been known as
Speaker 1: a talent factory. The Starbrecks one I thought was really amazing.
Speaker 1: It turns out that Corporate America news all stars come
Speaker 1: from Starbucks and basically raids Starbucks, and Starbucks is okay
Speaker 1: with that because those people go on and do other
Speaker 1: things and then kind of end up coming back to
Speaker 1: Starbucks eventually. It's like, it's amazing. And also I got
Speaker 1: highly recommend I know you pointed this out to us
Speaker 1: Joel as well, after you've done a spot with us.
Speaker 1: The remarks what happens after peak Everything by our Gina
Speaker 1: Martin Adams. We've been talking so much about peak growth.
Speaker 1: So it's a great issue, a great summer read. Check
Speaker 1: it out on newsstands online at the Bloomberg and you
Speaker 1: can also find it at Bloomberg dot com slash business Week. Alright,
Speaker 1: til Weber, thank you so much of a great weekend.
Speaker 1: This is Bloomberg Business Week with Carol Masser and Bloomberg
Speaker 1: Quick Takes Tim Stinovic on Bloomberg Radio. So, top story
Speaker 1: this weekend on this Friday, the impact of rising COVID cases. Again,
Speaker 1: Charlie just mentioned that headline more than thousand vaccine breakthrough
Speaker 1: cases identified in US. We've got a hold right through
Speaker 1: on the Bloomberg Buyer Drew Armstrong and team, so check
Speaker 1: that out. Uh. There's also story on the Bloomberg Today
Speaker 1: Tim talking about the travel industry and how the travel
Speaker 1: rebound is hitting an air pocket as the delta variant spread.
Speaker 1: So Asia faltering, US growth stalling, Europeans though seeing a
Speaker 1: comeback in terms of the travel industry that seems to
Speaker 1: be taking hold of it. Well, somebody who has his
Speaker 1: hand on the pulse of the travel industry is actual.
Speaker 1: He for CEO of Tree Vago joining us now on
Speaker 1: the phone from Germany. Actual. Great to have you back
Speaker 1: with us. How are you I'm well, I'm well. How
Speaker 1: are Yeah, We're good. We're good. We're watching the rise
Speaker 1: of delta good. We're like freaking out trying to understand
Speaker 1: what the delta variant because it does feel like we're
Speaker 1: getting conflicting tends too nice, I'll revise my statement, we're
Speaker 1: freaking out, Axel, How do you make sense of wear masks,
Speaker 1: get a vaccine, get a vaccine, don't wear masks. Like
Speaker 1: you run a company where you have to be making decisions.
Speaker 1: How do you see it? So? UM, it's a good
Speaker 1: question and it's quite complicated, but what we are seeing
Speaker 1: right now in Europe, basically, I would say two things UM.
Speaker 1: One is that UM having a high level of vaccinated
Speaker 1: people helps UM significantly to to avoid severe cases, which
Speaker 1: is the key objective UM. And the second thing UM
Speaker 1: that we are seeing is that the delta variant is
Speaker 1: much more contagious. And so even at this this point
Speaker 1: in the year where last year infections were very low,
Speaker 1: the infections are searching. But so far, at least in
Speaker 1: in the Netherlands, in the UK with very few receivere
Speaker 1: cases so mixed. I would say, how quickly does headlines
Speaker 1: do headlines like this do rising cases? How quickly do
Speaker 1: those manifest in changing the way that that people are
Speaker 1: using tree Vago. It's a global hotel and accommodation search platform.
Speaker 1: So how quickly do you see rising cases or declining
Speaker 1: cases in a place like the UK or parts of Europe.
Speaker 1: How does that manifest itself into what happens on your platform?
Speaker 1: I mean, the the the key thing is not so
Speaker 1: much an increase in cases, because I mean, like heading
Speaker 1: into the autumn, everybody is expecting cases to increase. Again,
Speaker 1: We've seen it last year and and in a way
Speaker 1: we are seeing it every winter with with virus um
Speaker 1: hitting us. But the thing that is really hurting the
Speaker 1: interest to travel our traveler restrictions so UM for example
Speaker 1: spaying now being put on the high risk list in
Speaker 1: Germany has an immediate impact because if you're traveling with
Speaker 1: unvaccinated children, you have to quarantine, which has a huge
Speaker 1: impact in particularly for families. And these kind of travel
Speaker 1: restrictions are are making travel a lot less predictable, which
Speaker 1: is the key problem from a travel industrict prospective. So
Speaker 1: it's it's it's more about the restrictions less about the
Speaker 1: way that that people are emotionally digesting this information. Yeah,
Speaker 1: I mean in a way, I mean the vaccination levels
Speaker 1: are are now quite high and vaccine is widely available
Speaker 1: in Europe, so whoever is very concerned about catching the
Speaker 1: virus can get vaccinated. But there's no way around travel
Speaker 1: restrictions even if you're vaccinated and and travel with your family. Hey,
Speaker 1: actually your earnings came out after the close last night,
Speaker 1: two Q revenue beating estimates. Commentary included that you saw
Speaker 1: a strong recovery and travel demand in the second quarter.
Speaker 1: I am curious, too bad breakdown of leisure versus business
Speaker 1: business is still not that correct, absolutely so. So it's
Speaker 1: it's very similar to what we've seen in last year.
Speaker 1: There is a immediate search in really leisure um and
Speaker 1: and beach and mountaindestination. So really the way to think
Speaker 1: about is whatevery, wherever you would go with your family.
Speaker 1: I mean, those destinations are very very popular coming out
Speaker 1: of the lockdown, which is understandable, and business travel is
Speaker 1: still very limited. We'll talk to us a litt bit
Speaker 1: more about the trends within leisure because I know we've
Speaker 1: talked with you in the past and that during the
Speaker 1: pandemic we saw a play out here in the US.
Speaker 1: Either people went to remote places when camping went away
Speaker 1: from people but they also had to travel local. Is
Speaker 1: that staying with us? Yeah, I mean there are still
Speaker 1: I mean locally is very popular and the local destinations
Speaker 1: that within reach our our book booked out basically, but
Speaker 1: there is also a return to for the Northern Europeans
Speaker 1: to the Southern European destinations. Um. The weather is just
Speaker 1: much better, to be honest, And we are now one
Speaker 1: and a half years in the pandemic. Again, vaccination vaccines
Speaker 1: are widely available, so it is less scary than than
Speaker 1: a year ago. Um, but obviously it's it's done, not
Speaker 1: over yet. Actually, does business travel ever come back to
Speaker 1: what it was pre pandemic? It's a it's it's it's
Speaker 1: a big, big question and a good question. So so
Speaker 1: the way we are thinking about it is that there
Speaker 1: are basically two kinds of business trips. One is is
Speaker 1: a relationship meeting and relationship trip, and the other one
Speaker 1: is more transactional. And the relationship trips we think will
Speaker 1: will church um at the right point in time, because
Speaker 1: there's a huge backlog of important business partners that you
Speaker 1: haven't seen in a very long time, and relationships cannot
Speaker 1: really be built the same way via video conference on
Speaker 1: the transactional meetings. They're most companies, will we praise a
Speaker 1: certain percentage of those via video conference. And just to
Speaker 1: give you give your sense, I mean internally, obviously we
Speaker 1: are talking about the same thing and saying, okay, the
Speaker 1: our key partners we need to see once a year.
Speaker 1: But before the crisis, I mean, we've seen them a
Speaker 1: couple of times a year, and we are now using
Speaker 1: video companies for the for the other meetings. That's fascinating, right,
Speaker 1: because you guys are you know, as you run your
Speaker 1: own company, what you're do in terms of business travel.
Speaker 1: It's interesting you say that about the relationship trip. I
Speaker 1: get that. I mean, we are slowly having some people
Speaker 1: come in, but it's far and few between. They've got
Speaker 1: to get tested. But I recently had a meeting with
Speaker 1: the CEO and the press team, you know, his internal
Speaker 1: and external press team brought him here so I could
Speaker 1: meet him and talk with him because it was about
Speaker 1: the first time, you know, possibly getting an interview. But
Speaker 1: it was all about relationship building, tim and that is
Speaker 1: so different than doing a call over Zoom, doing a
Speaker 1: call over Microsoft teams are doing a skype and I
Speaker 1: feel the same way with with colleagues returning to the
Speaker 1: office because meeting I mean, I've only worked here since
Speaker 1: October and meeting people for the first time is a
Speaker 1: lot different than talking to them over over a video
Speaker 1: conferencing system. Yeah, it is pretty remarkable. You've been here
Speaker 1: for eight months and then people walk in the student
Speaker 1: You're like, you're listening to Bloomberg Business Week with Carol
Speaker 1: Masser and Bloomberg Quick Takes. Tim Stinovic on Bloomberg Radio,
Speaker 1: still with us as Axel, he for our CEO of Travago,
Speaker 1: still with us on the phone from Germany. Hey, Axel,
Speaker 1: what's cool about speaking with someone with you like you
Speaker 1: is that, first of all, you've got a global perspective
Speaker 1: and you're seeing a lot in terms of what has
Speaker 1: been an industry that has been so hard hit it
Speaker 1: because of the pandemic. So we're getting an idea of,
Speaker 1: you know, kind of what reopening looks like and where
Speaker 1: it's going. But you also collect a lot of data
Speaker 1: and I do wonder about pricing of travel and travel packages.
Speaker 1: Are there's still a lot of deals being offered to
Speaker 1: incent people to actually take a trip. What can you
Speaker 1: tell us about that? Yes, so so um so money
Speaker 1: is currently not the key concern. I mean, so when
Speaker 1: you when the markets opened up, the key concern of
Speaker 1: almost everybody, I would say, was to get out and
Speaker 1: uh and to have a nice time and to get
Speaker 1: to a nice destination. So the top destinations are were
Speaker 1: fully booked very quickly. On the other hand, if you're um,
Speaker 1: if you're if you're basically anti circlical in your behavior,
Speaker 1: and if you're now going for city trips, you can
Speaker 1: get very good deals because they're the key cities and
Speaker 1: business destinations are still completely underutilized and occupancy is low,
Speaker 1: so it a bit mixed depending on what you're looking for. Um. Uh,
Speaker 1: So there's no consistent picture. So you mentioned destinations. Top
Speaker 1: destinations book pretty quickly. What are the top destinations? Where
Speaker 1: is everybody going right now? So it's really going going
Speaker 1: to the beach and to the top mountain mountain destinations. UM.
Speaker 1: So if you just take Germany as an example, the
Speaker 1: German coast is pretty much fully booked as it was
Speaker 1: last year. Um and then close by destinations like never
Speaker 1: Land again at the coast or the mountains Austria or
Speaker 1: also in southern Germany are pretty much fully booked, whereas
Speaker 1: if you're going to Berlin. UM, A lot of the
Speaker 1: international and in particularly long haul tourists are not in town.
Speaker 1: Very few business travelers are there, so a lot of
Speaker 1: very nice hotels have a pretty attractive deal there. You
Speaker 1: wrote in your earnings report that you expect revenues to
Speaker 1: be concentrated in the summer months in one even more
Speaker 1: so than was the case in years prior to the pandemic.
Speaker 1: What's a realistic way for investors intree Argo to to
Speaker 1: think about a full recovery for your company? What would
Speaker 1: have to happen and what would a timeline for that
Speaker 1: look like. I think it will just take time, to
Speaker 1: be honest now, because the pandemic is not over at
Speaker 1: a certain point in time, but it's more going in
Speaker 1: waves than we are seeing an upward trajectory. So it's
Speaker 1: getting It's got a lot better now in summer like
Speaker 1: last year, and it's it's almost certain that it will
Speaker 1: get get worse over over the winter and then in
Speaker 1: spring it will get better again. UM. But with every
Speaker 1: wave we learned better how to deal with the pandemic.
Speaker 1: Medication is getting better, a number of vaccinated people is
Speaker 1: hopefully continue to increase. UM and so in a way,
Speaker 1: the impact of the virus will will diminish over time. Um,
Speaker 1: but it will take some time for things to normalize,
Speaker 1: because let's be honest, we've got a delta variant right now.
Speaker 1: But as long as there are hundred of millions and
Speaker 1: billions of people on our planet unvaccinated, it is guaranteed
Speaker 1: that there will be new variants. So, UM, it will
Speaker 1: take some time and will you have to be a
Speaker 1: bit patient if you're in trouble. But on the other hand, um,
Speaker 1: it's uh, the industry is on an up watch objectory
Speaker 1: and um it's it's also exciting and opens up a
Speaker 1: lot of opportunities if you're in an industry that is
Speaker 1: that volatile. Um, and it's also changing now. I know
Speaker 1: it's later there in Germany. You sound pretty tired though,
Speaker 1: and tell us I know yet earnings. That's right, Tim,
Speaker 1: good point. But when we talked about it too, it's
Speaker 1: been very dense and the amount of headlines coming at us,
Speaker 1: a lot of a lot of movement in our world,
Speaker 1: and still a fair amount of uncertainty. How do you
Speaker 1: see the outlook? What? How what do you feel comfortable
Speaker 1: kind of committing to when it comes to the next
Speaker 1: six or twelve months. So see, I told you seem tired.
Speaker 1: It's all entire they up to me. But but basically
Speaker 1: what we're saying internally is we need we need to
Speaker 1: stay optimistic and focus on the positives. And the summer
Speaker 1: was now very very positive. UM and even with the
Speaker 1: with the autumn getting getting a bit worse. UM, it
Speaker 1: is important to then then focus on next summer and
Speaker 1: and focus on on the opportunities that are arising. And
Speaker 1: one thing that that I think we talked about before
Speaker 1: is we launched a new local travel product that is
Speaker 1: an opportunity, so there is more demand for local travel.
Speaker 1: So UM, all of us need to stay positive and
Speaker 1: really focus focus on the positives and the opportunity. Is
Speaker 1: it's very easy to be carried away by um a
Speaker 1: lot of the frustrating things that that we are all
Speaker 1: facing and have been facing now for quite a while. Yeah.
Speaker 1: I know that's a good point. And I think people
Speaker 1: are really finding travel as a way to just kind
Speaker 1: of boost their energy and and feel more normal. He
Speaker 1: just got about thirty forty seconds. Workers. You guys have
Speaker 1: a global workforce. Are you finding workers that you need?
Speaker 1: Are you adding enough? Are you are you adding any
Speaker 1: give me an idea what you're doing with your your workforce. Yes,
Speaker 1: so there. I mean we've we've always been global, but
Speaker 1: but running the business um from one location, so just
Speaker 1: in Germany. So we've we've even before the pandemic had
Speaker 1: seventy percent of our colleagues coming from abroad and we
Speaker 1: continue to do that. But but you're right, Um, depending
Speaker 1: on where a new colleagues are coming from, sometimes they
Speaker 1: have to start to work actually from abroad because the
Speaker 1: immigration process takes longer. Um, if you're in a in
Speaker 1: a lockdown situation, you can't go ecletally to the embassy, etcetera.
Speaker 1: So in a way, I think to simplify everything is
Speaker 1: more complicated and will stay more complicated. But again that
Speaker 1: that it is the way it is and and we
Speaker 1: just need to deal with it. Well. Always great to
Speaker 1: hear your voice, and I hope you get some time
Speaker 1: off as well this summer, and let's hope that in
Speaker 1: terms of travel and reopening, it all continues aspl Heaper,
Speaker 1: chief executive Officer of Travigo. I really go to voice
Speaker 1: for us throughout the pandemic when it comes to the
Speaker 1: travel industry with us from Germany, all depending on the
Speaker 1: pandemic recovery, saying it's not going to just be gone
Speaker 1: right coming in waves. That's what we see exactly. You
Speaker 1: are listening to Bloomberg Business Week on Bloomberg Radio. I'm
Speaker 1: roc journal. Yeah, but you let me drive? No, no, no,
Speaker 1: no's home please, I'll do the right ravel. I don't
Speaker 1: want to drive, just drive baby. The question trying this
Speaker 1: is the drive to the globe. Give me thanks. We'll
Speaker 1: dry us to dawn on Bloomberg Radio for a week
Speaker 1: and we're wrapping up the month of over yet. Okay,
Speaker 1: come on, we have that tenant a half minutes left
Speaker 1: in today's trading session. But we are getting ready to
Speaker 1: wrap up quite a trading week, quite a trading month.
Speaker 1: Stocks are definitely off their highs and lows of the day.
Speaker 1: Is Charlie just breaking down those numbers. So let's get
Speaker 1: to it. The drive to the close. At Jay Hatfield,
Speaker 1: he see you and founder of Infrastructure Capital Advisors, the
Speaker 1: Infra Infra Cap Active MLP et f IT invest in
Speaker 1: Master Limited Partnerships is up about fifty so far year today,
Speaker 1: he joins us on the phone in New York City. Hey,
Speaker 1: j how are you good. Thanks for having me on. Well,
Speaker 1: great to have you on. Uh, we're kind of tired.
Speaker 1: It's been a really dense week and what's been a
Speaker 1: dense month, and what's been already a dense year. How
Speaker 1: do you see kind of where we are in the
Speaker 1: market cycle, the economic cycle. Well, we think it's it's
Speaker 1: a riskier time to invest. We've been extremely bullish since
Speaker 1: March of last year when the FED intervened. So we
Speaker 1: are we are saying is follow the Fed, not don't
Speaker 1: fight it, but follow it. And if you normally, if
Speaker 1: you do that, you're you'll be successful. But so now
Speaker 1: it's much more dicecy because we believe the FED will
Speaker 1: have to taper, and specifically you can't the um quantity
Speaker 1: theory of money does is operative at the extreme, in
Speaker 1: other words, to increase the monetary base or or money
Speaker 1: about a year, eventually you're gonna have inflation at d
Speaker 1: and we've seen that in developing countries like Lebanon. But
Speaker 1: the US has increased the monetary based so we believe
Speaker 1: that inflation could be transitory, but only if the FED
Speaker 1: stops increasing the monetary base at that rate. So you're
Speaker 1: going to see eventually the Fed take the punch bowl away.
Speaker 1: That's more likely to happen next year. And then also
Speaker 1: next year is going to be a big deceleration and
Speaker 1: inflation well, and and also price inflation. Eventually, eventually that
Speaker 1: the normal cycle which we saw No. Seven or eight
Speaker 1: is you just had acid inflation. Then the FED tapered,
Speaker 1: and also of course it was a horrible almost a
Speaker 1: depression worth session since World War Two, but they did taper.
Speaker 1: My only point is that now that we're in full recovery,
Speaker 1: they haven't even started tapering. And this KIWI is much
Speaker 1: larger than the last QWI. So eventually they asset inflation
Speaker 1: and leads to real inflation, which is what we think
Speaker 1: we see now, and some of its transitory. But if
Speaker 1: you keep increasing the money supply by eventually we'll get
Speaker 1: double digit inflation. Otherwise every country in the world would
Speaker 1: do that because it's a great business. You issue currency
Speaker 1: and get back, you know, real goods. So there is
Speaker 1: a limit to it. Obviously US can get away with
Speaker 1: it more than Lebanon can. But so the FIT is
Speaker 1: going to have to taper at some point. Even they
Speaker 1: are saying that now where do you see, where do
Speaker 1: you see? Where are you going to see this in
Speaker 1: the data, where which prices are you going to see
Speaker 1: increased like that? And at that point, what do you
Speaker 1: do well? I think that that you know, every that's
Speaker 1: a good point, like every CPI report is a potential
Speaker 1: negative at lists. But of course the FETE is saying
Speaker 1: that it's transitorian that they're going to hold off. So
Speaker 1: the real issue, we're really more neutral on the market
Speaker 1: because you do have this billion dollars of liquidity be
Speaker 1: inject every month. It has to go somewhere, so we're
Speaker 1: more range bound in the market. So yes, you know,
Speaker 1: CPR will probably print hot, market will get a little weak,
Speaker 1: but then there's so much liquidity you get bid, just
Speaker 1: like we saw when we went down to the fifty
Speaker 1: day moving average. That lasted all of you one night
Speaker 1: and then we were stabilized. So it's not like we're
Speaker 1: saying go sell everything. We're really saying it's a good
Speaker 1: time to be defensive, get into equity, income securities, and
Speaker 1: maybe not you know, be gambling on on the latest
Speaker 1: fat whether it be bitcoin or mean stocks or or
Speaker 1: potentially overvalued tech stocks. Bond market, though it's been an
Speaker 1: interesting trade where we've often seen both bonds and stocks
Speaker 1: go up in tandem and rates are still incredibly low
Speaker 1: all along the yield curve. And so we've seen the
Speaker 1: bond market tell us a different story when they don't
Speaker 1: buy what the fete is saying or buy what the
Speaker 1: economic data points are saying. So what's your take on
Speaker 1: where the bond market is. Well, what you saw is
Speaker 1: in mid May, and it gets back to Tim's question
Speaker 1: about what are the inflection points. So in mid May
Speaker 1: you got the April cp I and then there would
Speaker 1: start a commencement of discussion of taper, and you saw
Speaker 1: the inflation implied. Uh, you know in the bond market
Speaker 1: between tips, the gap between tips and treasuries and the
Speaker 1: tenure declined by thirty basis points. So that was roughly
Speaker 1: how much treasuries decline. So we do think that the market,
Speaker 1: maybe more the bond market than the stock market, is
Speaker 1: pricing in stagflation next year. Because it's important to realize
Speaker 1: this isn't sort of a you know, a crazy forecast
Speaker 1: of ours and there's going to be we're forecasting eight
Speaker 1: billion of fiscal deceleration, you know, thirty billionellion from taxes
Speaker 1: and five from spending. Because you just can't replicate the
Speaker 1: stimulus that occurred, um, you know, with the three trillions
Speaker 1: of stimulus that occurred at the beginning of this year.
Speaker 1: But that's just it's not gonna happen next year. There's
Speaker 1: gonna be a lot of spending, but not that kind
Speaker 1: of spending. So stagflation is by far the most likely case,
Speaker 1: and we think the bond market is pricing that in
Speaker 1: maybe a little bit earlier than the stock market. And
Speaker 1: so that's why we're a little bit cautious about the
Speaker 1: stock market. And I think that you know, security is
Speaker 1: like preferred stock that are senior to common give you
Speaker 1: some income, probably a better way to play over the
Speaker 1: next three or you know, during the fall, which is
Speaker 1: usually a very vaultile time. Uh So, And if you
Speaker 1: do a great thing about income security, even if you
Speaker 1: miss a little rally and tech stocks or recovery inflation stocks,
Speaker 1: you still get paid to weigh. They're great companies like
Speaker 1: utilities are preferred of utilities, uh reads, and um, you know,
Speaker 1: consumer staples. So it's not like you're gonna it's a
Speaker 1: tragedy if you miss out on a little bit of rally.
Speaker 1: And the tech sector, well, let's talk a little bit
Speaker 1: about the tech sector, because you did describe tech companies
Speaker 1: as being overvalued. Amazon down seven point five percent after
Speaker 1: a miss on revenue and then the guidance really spooking investors. Um,
Speaker 1: what what stock specifically do you think are overvalued and
Speaker 1: when would you buy into those? Well, I'm not going
Speaker 1: to get into all the names that clearly the companies
Speaker 1: the big tech actually is acting more defensive lea than
Speaker 1: than um you know, any other ethic class really, but
Speaker 1: we're really talking about the tech stocks that rely on
Speaker 1: forecasts of earnings five or six or seven years out,
Speaker 1: and those are the ones that tend to do um
Speaker 1: the you know, the poorest during any you know, down turns.
Speaker 1: So that's kind of what we're referring to, not really
Speaker 1: the mega caps. I mean, arguably Amazon was just a
Speaker 1: little bit of ahead of itself. And really, if you
Speaker 1: dig into the announcement, mean their core kind of secret
Speaker 1: sauce businesses to have the biggest margins are actually growing
Speaker 1: very fast. So I wouldn't be surprised if it's kind
Speaker 1: of finding sound forward support here that it doesn't bounce
Speaker 1: back forward. And look what happened last year. Now, I
Speaker 1: expectations were high. It's all perspective here. We gotta run.
Speaker 1: Thank you so much, really appreciate it. Have a great weekend.
Speaker 1: J Hatfield. He's chief executive officer. He is also founder
Speaker 1: of Infrastructure Capital Advisors, is in for cap Active MLP
Speaker 1: et F as I mentioned so far uh this year.
Speaker 1: Thanks for listening to Bloomberg Business Week. Download the podcast
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