WEBVTT - Ex-Treasury Secretary and Comptroller Attempts to Rescue NYCB 0:00:02.920 --> 0:00:11.360 Bloomberg Audio Studios, Podcasts, radio news. This is Bloomberg Business 0:00:11.400 --> 0:00:14.640 Wait inside from the reporters and editors who bring you 0:00:14.680 --> 0:00:19.000 America's most trusted business magazine plus global business, finance and 0:00:19.079 --> 0:00:23.520 tech news. The Bloomberg Business Week Podcast with Carol Messer 0:00:23.680 --> 0:00:26.480 and Tim Stenebeck from Bloomberg Radio. 0:00:27.840 --> 0:00:29.960 Your Community Bank or Tim continues to be on our 0:00:30.040 --> 0:00:33.440 radar because it's soaring again and there's a great story. 0:00:33.440 --> 0:00:35.440 It's a most read story in the Bloomberg really giving 0:00:35.520 --> 0:00:39.199 us some insight into the deal and kind of the 0:00:39.240 --> 0:00:42.760 instant paper profit that these individuals are making. 0:00:42.880 --> 0:00:45.919 Yeah, we're talking about individuals such as US Treasury Secretary 0:00:45.920 --> 0:00:48.919 Steve Menushan, who along with his Liberty Strategic Capital, led 0:00:48.920 --> 0:00:51.720 a group of investors that injected more than one billion 0:00:51.760 --> 0:00:55.760 dollars into New York Community Bank. And this could only 0:00:55.840 --> 0:00:58.240 be the beginning with more on the Menution playbook and 0:00:58.240 --> 0:01:00.200 what is a most read story on the Bloomberg with 0:01:00.280 --> 0:01:04.440 us as Bloomberg's Catherine Doherty, finance reporter off at Bloomberg 0:01:04.520 --> 0:01:07.040 News here in our studio. So, Catherine, it was interesting 0:01:07.080 --> 0:01:09.200 as this all played out yesterday Carol and I were 0:01:09.240 --> 0:01:11.280 on air and the stock was halted multiple times. But 0:01:11.600 --> 0:01:15.080 one thing that we did notice after our Bloomberg News 0:01:15.120 --> 0:01:17.240 team broke the story was that by the time it 0:01:17.280 --> 0:01:20.040 started trading again, it was above the price of two dollars, 0:01:20.520 --> 0:01:22.960 which is the price where Manution and team were able 0:01:22.959 --> 0:01:23.560 to buy in at. 0:01:23.720 --> 0:01:26.759 That's right, they've already minted quite a profit on paper. 0:01:27.200 --> 0:01:30.520 On paper, but it looks like it's holding out today. 0:01:30.959 --> 0:01:33.240 So it's been twenty four hours or so, or as 0:01:33.240 --> 0:01:36.360 we're getting to that point. So it's not to say 0:01:36.400 --> 0:01:41.840 that this is a forever proven strategy. They're going to 0:01:41.880 --> 0:01:44.440 have a lot of work to do. It's not just 0:01:44.560 --> 0:01:47.400 the investment and the number, but it's actually how do 0:01:47.440 --> 0:01:50.200 you turn this ship around and how do you get 0:01:50.240 --> 0:01:52.280 your heads together and bring in the best of the 0:01:52.280 --> 0:01:54.720 best to make sure that this bank has a future. 0:01:55.400 --> 0:02:00.400 But the share price is reflecting investors' sentiment, a positive sentiment, 0:02:00.840 --> 0:02:04.040 and their belief that these leaders and it's not just 0:02:04.080 --> 0:02:06.400 about the money, it's the people that are behind it 0:02:06.840 --> 0:02:12.640 that presumably the bet is that they will succeed in 0:02:12.720 --> 0:02:13.560 turning the ship around. 0:02:13.639 --> 0:02:16.120 Let's talk about that and the Minutian Steve Manushan playbook, 0:02:16.120 --> 0:02:17.720 because this is what's interesting and this was some of 0:02:17.720 --> 0:02:19.880 what we were getting yesterday, that these are people who 0:02:19.919 --> 0:02:23.200 are respected investors, kind of know how to deal with 0:02:23.240 --> 0:02:26.160 this kind of situation. What's the playbook? And let's kind 0:02:26.160 --> 0:02:28.959 of maybe go backwards right to Indie Mac because right 0:02:29.080 --> 0:02:31.800 kind of bringing the gang back together, it seems. 0:02:31.600 --> 0:02:35.320 So back in two thousand and eight Indie Mac which 0:02:35.639 --> 0:02:40.079 eventually turned into West West Bank, I believe was the name, 0:02:40.160 --> 0:02:44.359 and Joseph Auding was the CEO of West of one, 0:02:44.400 --> 0:02:49.040 west of that firm. But today again bringing the back 0:02:49.080 --> 0:02:54.320 together band back together, Adding is the CEO of NYCB 0:02:54.520 --> 0:02:57.840 now And clearly this is the relationships that have been 0:02:57.840 --> 0:03:01.880 built in the past, the trust and the knowledge that 0:03:02.320 --> 0:03:06.639 these leaders have gained in not just finance but in banking, 0:03:07.160 --> 0:03:10.240 which is a very specific industry to have some of 0:03:10.280 --> 0:03:13.520 these very strategic plans that they're going to need to 0:03:13.520 --> 0:03:16.080 set forth in terms of how to diversify the bank, 0:03:16.400 --> 0:03:19.480 how to deal with the existing problems that they've already identified. 0:03:20.080 --> 0:03:22.760 And today they started talking about that to investors. 0:03:22.360 --> 0:03:24.360 Well, that's what I want to hear from you. And 0:03:24.400 --> 0:03:26.520 what do we understand now that they're talking about this, 0:03:26.600 --> 0:03:29.080 how they shore up the balance sheet especially exposure to 0:03:29.120 --> 0:03:30.040 commercial real estate. 0:03:30.200 --> 0:03:33.480 So executives today talked about the main issue being the 0:03:33.520 --> 0:03:37.280 loan portfolio and this portion that is specifically linked to 0:03:37.760 --> 0:03:41.880 New York Office. So they're saying that their goal over 0:03:41.960 --> 0:03:44.600 time is to diversify the bank. Essentially, what they want 0:03:44.640 --> 0:03:47.520 to do is make this bank look more like the 0:03:47.560 --> 0:03:51.120 other regional banks because right now there's so much concentration 0:03:51.640 --> 0:03:56.000 in real estate, in lending to the landlords of New 0:03:56.040 --> 0:03:56.560 York City. 0:03:57.200 --> 0:03:59.520 Yeah, and we've talked about this that the law changes 0:03:59.520 --> 0:04:03.040 and stuff has really kind of changed the financial outlook, 0:04:03.040 --> 0:04:05.880 if you will, of these assets or the profitability one 0:04:05.880 --> 0:04:07.680 thing I want to ask you about. So as they 0:04:07.760 --> 0:04:10.920 kind of move forward, investors, the stocks app thirteen fourteen 0:04:10.960 --> 0:04:13.920 percent just in the last two days alone. But you know, 0:04:14.520 --> 0:04:17.320 the Indiemac deal go backwards for a second. There was 0:04:17.360 --> 0:04:22.240 some criticism of the duo and their past link up ultimately, 0:04:22.400 --> 0:04:25.640 so it'll be interesting to see how they kind of 0:04:25.640 --> 0:04:29.039 deal with all these assets that not any deal going 0:04:29.040 --> 0:04:31.200 forward is ever maybe perfect, that's right. 0:04:31.279 --> 0:04:35.880 And so that deal with Indiemac was linked to mortgages. Correct, 0:04:35.920 --> 0:04:40.880 This is lending, so it's a different business essentially, the 0:04:41.240 --> 0:04:47.360 lending to real estate firms in two buildings, both for 0:04:48.440 --> 0:04:52.600 businesses and for landlords, so for commercial real estate and 0:04:52.640 --> 0:04:56.599 also for housing. Again, these are going to be that's 0:04:56.720 --> 0:04:59.920 different than lending out or giving a mortgage to some 0:05:00.080 --> 0:05:01.480 one if they're buying a home. 0:05:01.920 --> 0:05:04.800 What do we know about where the money came from 0:05:04.839 --> 0:05:08.760 for Liberty Strategic Capital at this point and what the 0:05:08.800 --> 0:05:10.960 former treasure sectary has been doing over the past few 0:05:11.000 --> 0:05:12.760 years when it comes to fundraising. 0:05:12.440 --> 0:05:17.640 So Mnuchin, there has been some pushback which was referenced 0:05:17.640 --> 0:05:21.160 in this story. There's been some critique because after he 0:05:21.600 --> 0:05:25.920 left being Treasury he was raising money for Liberty from 0:05:26.080 --> 0:05:29.360 sovereign wealth funds in the Middle East, and that includes 0:05:29.760 --> 0:05:33.400 Saudi Arabia's public Investment fund. That is something that was 0:05:33.480 --> 0:05:37.000 under scrutiny. What I found interesting is that with this deal, 0:05:37.400 --> 0:05:41.160 Mnuchan was saying that they initially went out with around 0:05:41.200 --> 0:05:44.920 seven hundred and there was so much interest that then 0:05:44.920 --> 0:05:47.520 they raised it to the one billion mark. So it 0:05:47.680 --> 0:05:52.880 just showed that the enthusiasm that were seen reflected in 0:05:52.920 --> 0:05:56.920 the stock price from other investors was also there when 0:05:56.960 --> 0:06:00.440 they were pitching this deal to the street. 0:06:00.880 --> 0:06:02.480 Yeah, it is interesting, like kind of when you go 0:06:02.560 --> 0:06:05.240 through it and you look backwards in terms of the 0:06:05.279 --> 0:06:08.800 Indiemac deal and just these individuals that have been assembled 0:06:08.839 --> 0:06:11.200 to kind of again not apples to apples in terms 0:06:11.279 --> 0:06:13.520 of the bank, but dealing kind of with a I 0:06:13.520 --> 0:06:15.120 don't want to use the word crisis, but certainly a 0:06:15.200 --> 0:06:17.440 very troubled situation and trying to figure it kind of 0:06:17.480 --> 0:06:18.120 the way forward. 0:06:18.200 --> 0:06:22.120 Right Well, financially it's a troubled situation, and they're buying 0:06:22.160 --> 0:06:24.840 in at such a cheap price. These are the types 0:06:24.839 --> 0:06:28.560 of deals. Think about Warren Buffett coming in and supporting 0:06:28.600 --> 0:06:32.359 Bank of America in its time of crisis way back 0:06:32.440 --> 0:06:34.760 in two thousand and seven, two thousand and eight period, 0:06:34.920 --> 0:06:37.680 and look how that turned out for him. Again, that 0:06:37.839 --> 0:06:40.440 was a windfall and it was also a lifeline for 0:06:40.520 --> 0:06:43.920 Bank of America. So it's a very similar narrative that 0:06:43.960 --> 0:06:46.240 I think a lot of people are comparing this moment 0:06:46.320 --> 0:06:49.440 in time too. You have a bank that has fallen 0:06:49.480 --> 0:06:53.120 on tough times. The share price is showing that, and 0:06:53.240 --> 0:06:57.680 already the deal and the investors that bought in early 0:06:57.720 --> 0:06:58.679 have minted a profit. 0:06:58.960 --> 0:07:02.240 It's on paper going to say it's only day two, right, 0:07:02.480 --> 0:07:04.880 day one, I guess you could say day one full day, 0:07:05.600 --> 0:07:07.120 and they're not out of the woods yet, Kat. 0:07:07.080 --> 0:07:10.920 No, they're gonna need to prove that they have the 0:07:11.080 --> 0:07:13.880 strategies in place. They outlined them this morning, So I 0:07:13.920 --> 0:07:16.640 think that that is another reason that you've seen the 0:07:16.680 --> 0:07:20.600 share price remain at a higher level. It didn't jump 0:07:20.760 --> 0:07:24.560 significantly from where it already jumped yesterday. It's still around 0:07:24.600 --> 0:07:27.840 the four dollar mark, just below last time that I checked. 0:07:28.840 --> 0:07:33.960 But you're you're absolutely right. This is a strategic playbook 0:07:34.000 --> 0:07:36.000 that is needed there. They're going to need time to 0:07:36.080 --> 0:07:40.200 show that it's actually working. And I find it interesting 0:07:40.320 --> 0:07:43.720 the goal of being more like their peers. But this 0:07:43.880 --> 0:07:47.520 is a large organization because they bought assets from Signature 0:07:47.920 --> 0:07:51.480 earlier and they've grown rapidly. That was part of its struggle. 0:07:51.480 --> 0:07:53.840 They didn't know how to deal with that size that 0:07:53.920 --> 0:07:55.760 they a lot of pieces there, a lot of pieces 0:07:55.760 --> 0:07:57.640 of the puzzle. All right, Kat Doherty, Financial Porter, a 0:07:57.680 --> 0:07:59.360 Blomberg News. Thank you so much. 0:08:00.360 --> 0:08:03.880 You're listening to the Bloomberg Business Week podcast. Catch us 0:08:03.920 --> 0:08:07.160 live weekday afternoons from two to five pm Eastern Listen 0:08:07.200 --> 0:08:09.360 on Apple car Play and then brout Auto with a 0:08:09.400 --> 0:08:15.200 Bloomberg Business app, or want us Live on YouTube. 0:08:16.320 --> 0:08:19.000 Well, you might recall that Bloomberg News was reporting out 0:08:19.040 --> 0:08:22.440 last month on Florida's southwestern coast, long one of America's 0:08:22.520 --> 0:08:25.440 fastest growing regions, and how it is losing some of 0:08:25.480 --> 0:08:29.080 its boomtown swagger as a home insurance crisis and other 0:08:29.160 --> 0:08:32.439 staring costs make homes unaffordable. It's a serious situation, it is. 0:08:32.480 --> 0:08:34.200 And at the same time, Carol, we've also talked about 0:08:34.240 --> 0:08:37.439 how the migration of financial types down south, think Citadel's 0:08:37.480 --> 0:08:41.160 Ked Griffin Moore are now calling South Florida home and 0:08:41.200 --> 0:08:44.640 pushing up prices not just of residential real estate, but 0:08:44.720 --> 0:08:46.160 also commercial real estate too. 0:08:46.200 --> 0:08:48.080 All Right, so there's a lot going down down south, 0:08:48.120 --> 0:08:50.199 specifically in the state of Florida. With all this in mind, 0:08:50.240 --> 0:08:53.720 joining us to talk about the Miami market specifically with 0:08:53.800 --> 0:08:56.640 us as Dina Golden Tayer, she's executive director of sales 0:08:56.679 --> 0:09:00.360 over at Douglas Element. She joins us from Miamia to 0:09:00.400 --> 0:09:03.360 have you here a lot to talk about. First up, 0:09:03.440 --> 0:09:06.240 how are you and how would you describe the luxury 0:09:06.280 --> 0:09:09.000 market in Miami. I mean, technically you're known as an 0:09:09.080 --> 0:09:11.959 ultra luxury specialist, So talk us a little bit about 0:09:11.960 --> 0:09:13.680 demand pricing, what you are seeing. 0:09:15.280 --> 0:09:18.000 Thank you so much for having me today. I am 0:09:18.040 --> 0:09:23.120 indeed ultra luxury specialists focusing on property's ten million and 0:09:23.200 --> 0:09:27.200 up and our market, as they say, is calliente. And 0:09:27.360 --> 0:09:30.040 there is no sign of a slow down for the 0:09:30.080 --> 0:09:32.200 ten million plus marketplace. 0:09:31.840 --> 0:09:35.680 All right, drilled down a little bit, so no slowing down. 0:09:35.800 --> 0:09:38.360 So the same as six months ago, twelve months ago. 0:09:38.480 --> 0:09:40.319 Give us some more color with Bloomberg. We'd love to 0:09:40.320 --> 0:09:42.959 dig a little bit deeper. Give us an idea of 0:09:43.400 --> 0:09:45.440 how it's playing out and how it compares. 0:09:46.000 --> 0:09:49.000 Absolutely this time last year, we in fact had a 0:09:49.080 --> 0:09:52.520 much slower high season, high season being defined as the 0:09:52.600 --> 0:09:56.679 months of December, January, February, March April, when the snowbirds 0:09:56.679 --> 0:09:59.079 will want to be here. And this year we're having 0:09:59.080 --> 0:10:01.560 the type of high seat that we had hoped for 0:10:01.640 --> 0:10:05.040 last year, which is pending sales almost every other day 0:10:05.679 --> 0:10:10.360 for high quality assets that are appropriately priced. So if 0:10:10.360 --> 0:10:12.240 you're watching Zilla, you're going to see a lot of 0:10:12.240 --> 0:10:13.160 stuff go pending. 0:10:14.520 --> 0:10:17.120 Who are the buyers right now and how are they buying? 0:10:17.200 --> 0:10:20.280 Are these all cash buyers? Where are they coming from? 0:10:20.800 --> 0:10:22.000 Give us insight there. 0:10:22.760 --> 0:10:25.600 They're the usual suspects. They are coming from New York 0:10:25.679 --> 0:10:29.440 from other Northeastern states. They're coming from California and other 0:10:29.559 --> 0:10:33.560 Western states, and they're coming from Canada. The European buyer 0:10:33.600 --> 0:10:36.880 has slowly trickled back into the marketplace post COVID, but 0:10:36.920 --> 0:10:39.480 they're not as strong as they were in prior years. 0:10:39.800 --> 0:10:42.959 What about buyers from Asia and buyers from Russia. 0:10:44.520 --> 0:10:47.560 No, and no, and the buyers that I'm working with 0:10:47.800 --> 0:10:50.320 are not getting mortgages, or at least the deals are 0:10:50.360 --> 0:10:51.640 not finance contingent. 0:10:52.520 --> 0:10:55.440 What's a typical deal on the high end of Miami. 0:10:55.520 --> 0:10:57.560 You used ten million dollars as a price point. Is 0:10:57.559 --> 0:11:01.120 that kind of the mean? The median give us an 0:11:01.160 --> 0:11:03.200 idea because I know that they can go a lot higher, 0:11:03.240 --> 0:11:05.440 especially if you do something like Indian Creek Village, which 0:11:05.440 --> 0:11:09.079 Bloomberg has written about as being a place where millions 0:11:09.080 --> 0:11:11.240 don't matter. It's all about billions and billionaires. 0:11:11.559 --> 0:11:17.880 Great article, great job, Felipe. Ten million gets you a 0:11:18.000 --> 0:11:21.199 nice condo. It gets you a nice house, a very 0:11:21.320 --> 0:11:23.600 nice house, not in the water, an average house on 0:11:23.679 --> 0:11:25.960 the water. Twenty million is where it's at if you 0:11:26.000 --> 0:11:29.760 want something better than nice and my twenty million plus product, 0:11:29.800 --> 0:11:32.319 I have the shortest days on market than any other 0:11:32.400 --> 0:11:35.200 sector that I represent. In fact, it takes me longer 0:11:35.240 --> 0:11:38.720 to sell properties five to fifteen million than homes that 0:11:38.760 --> 0:11:41.240 are over twenty million, where I average about one hundred 0:11:41.240 --> 0:11:43.480 and twenty to one hundred and fifty days on market. 0:11:44.120 --> 0:11:46.679 Do you know who's selling right now? Who doesn't want 0:11:46.679 --> 0:11:48.880 to be there and who wants to sell for these prices? 0:11:49.559 --> 0:11:49.880 Sure? 0:11:50.000 --> 0:11:53.160 I mean that is a broad question because people selling 0:11:53.200 --> 0:11:56.160 don't necessarily not want to be in Miami. They may 0:11:56.200 --> 0:11:58.439 be expanding their family, or they may be going through 0:11:58.440 --> 0:12:01.679 a divorce. A lot of the people that from whom myself, 0:12:01.800 --> 0:12:04.160 or they are staying locally, just in a different asset 0:12:04.200 --> 0:12:07.439 class like downsizing or upsizing, or moving from a house 0:12:07.440 --> 0:12:08.760 to a condo or vice versa. 0:12:09.160 --> 0:12:11.960 You know, Tim was asking earlier Diana about who's doing 0:12:11.960 --> 0:12:14.200 the buying, and we've talked. You know, Bloomberg has done 0:12:14.240 --> 0:12:16.520 a lot of reporting about kind of Wall Street South 0:12:16.559 --> 0:12:20.000 and the amount of financial folks that have moved down 0:12:20.040 --> 0:12:22.480 there not only to live or buy a second home, 0:12:22.480 --> 0:12:24.360 but to actually set up shop and do work, and 0:12:24.360 --> 0:12:26.640 that has certainly had an impact on the Eric. Give 0:12:26.720 --> 0:12:28.120 us a little bit more color if you can around 0:12:28.160 --> 0:12:30.840 what you are seeing on that front specifically, is the 0:12:30.880 --> 0:12:33.800 pace continuing, is it picking up? Is it slowing down 0:12:33.840 --> 0:12:34.160 at all? 0:12:35.600 --> 0:12:38.480 I think if we compare the pace to the COVID times, 0:12:38.720 --> 0:12:41.440 it will always feel like a slowdown. Now Miami and 0:12:41.480 --> 0:12:44.360 Miami Beach, where I specifically focus on, has found a 0:12:44.400 --> 0:12:47.400 new rhythm. We continue to have an influx of the 0:12:47.800 --> 0:12:51.080 Wall Street types and other financiers from around the country. 0:12:51.280 --> 0:12:54.640 They are still taking prime positions at the schools for 0:12:54.720 --> 0:12:57.560 their children and the top reservations in town because we 0:12:57.679 --> 0:13:00.920 have pretty much the same restaurants New York City does, 0:13:01.000 --> 0:13:04.680 if not better right now. So the pace is healthy, 0:13:04.720 --> 0:13:06.960 It's just not a COVID pace, and to compare it 0:13:07.000 --> 0:13:09.280 to that would always look like we're in the run. 0:13:09.880 --> 0:13:12.560 What about folks with backgrounds in crypto right now, especially 0:13:12.600 --> 0:13:15.560 given the rise in crypto that we've seen last year 0:13:15.559 --> 0:13:16.439 and in recent months. 0:13:17.800 --> 0:13:20.199 I'm glad you bring it up, because crypto certainly has 0:13:20.200 --> 0:13:22.920 had a great couple of weeks, but I have not 0:13:23.120 --> 0:13:26.880 seen the complete return of the crypto bros. And in fact, 0:13:26.880 --> 0:13:29.800 when I did work with that fire class, they always 0:13:29.800 --> 0:13:31.320 paid cash. 0:13:31.400 --> 0:13:35.840 Well yeah you know, it's cash is cash? Yeah, got it? Yeah, 0:13:36.040 --> 0:13:38.920 no problem here. Easy clothes, quick clothes. 0:13:39.000 --> 0:13:41.920 But I haven't gotten a few calls lately asking if 0:13:41.920 --> 0:13:44.440 a seller would take crypto, so it is starting to 0:13:44.480 --> 0:13:46.240 come back as a subject point. 0:13:46.360 --> 0:13:48.080 Yeah, and I guess I was more interested in just 0:13:48.080 --> 0:13:49.920 the crypto bro's part of it. But I'm surprised that 0:13:50.240 --> 0:13:52.080 you know, you haven't seen the return of crypto bros 0:13:52.120 --> 0:13:53.280 completely that we saw a couple. 0:13:53.160 --> 0:13:53.640 Of years ago. 0:13:54.679 --> 0:13:57.680 No, and even you know they're already down here, they've 0:13:57.720 --> 0:14:01.680 already established residency. So if they're going to be perhaps 0:14:01.840 --> 0:14:04.960 upgrading because they're cryptos high, great, I'm excited to work 0:14:05.000 --> 0:14:08.680 with them again. But they're not the conversation at the 0:14:08.679 --> 0:14:11.160 height of the topics that are being discussed around town. 0:14:11.240 --> 0:14:13.040 Dana. This is a market you've been in since two 0:14:13.080 --> 0:14:14.880 thousand and five, so if you've seen a fair amount 0:14:14.880 --> 0:14:18.520 of cycles, including the Great Financial Crisis, you've seen obviously 0:14:18.520 --> 0:14:22.920 the pandemic and then some I am curious about how 0:14:22.960 --> 0:14:25.400 this market has evolved, how it's changed in terms of 0:14:25.440 --> 0:14:27.720 pricing and demand. What can you tell us about that, 0:14:27.760 --> 0:14:31.360 because that's a fairly long tenure and some great insight. 0:14:33.040 --> 0:14:35.920 Absolutely, I mean, the market has completely changed the type 0:14:35.960 --> 0:14:38.640 of buyers that were attracting to our marketplace. I don't 0:14:38.680 --> 0:14:42.440 think anyone thought that Miami would be competing with buyers 0:14:42.520 --> 0:14:45.720 looking at London, New York, Hong Kong, that they would 0:14:45.760 --> 0:14:49.320 look to us as their first home. It's very clear 0:14:49.320 --> 0:14:52.120 that Miami is the top city in the country right now. 0:14:52.360 --> 0:14:55.320 LA and New York don't have anything on us. Clearly, 0:14:55.360 --> 0:14:58.600 I'm a cheerleader for my marketplace, but having traveled around 0:14:58.600 --> 0:15:02.720 the country to the cities where buyers are fleeing from, 0:15:02.800 --> 0:15:04.320 I can understand, why. 0:15:04.640 --> 0:15:07.400 Do you see? You said you saw a slow down 0:15:08.160 --> 0:15:11.560 in sub ten million dollar listings? Is that the case? 0:15:12.600 --> 0:15:15.720 I would say, there's higher inventory and higher days on market. 0:15:16.040 --> 0:15:19.040 I guess you could call that a slowdown, or I 0:15:19.040 --> 0:15:21.680 would just say it's not as high as homes. 0:15:21.520 --> 0:15:23.880 Of twenty Let's phrase it a different way. Where are 0:15:23.880 --> 0:15:25.520 they're buying opportunities right now? 0:15:26.640 --> 0:15:30.400 Sure they are buying opportunities, definitely in the ten to 0:15:30.400 --> 0:15:33.840 fifteen million range, because those properties are having higher days 0:15:33.880 --> 0:15:37.320 on market. There are neighborhoods that are let's call them 0:15:37.520 --> 0:15:40.120 one notch below the A level, neighborhoods like B plus 0:15:40.120 --> 0:15:44.320 neighborhoods like Miami Shores or Sam Sushi or a keystone 0:15:44.440 --> 0:15:47.760 where there are opportunities, whereas in really established neighborhoods like 0:15:47.960 --> 0:15:51.640 Miami Beach, Golden Beach and Coral Gables, those owners are 0:15:51.680 --> 0:15:52.880 just holding. 0:15:53.480 --> 0:15:55.880 Rates interest rates. Does it even matter? Just got about 0:15:56.160 --> 0:15:57.120 twenty seconds here. 0:15:58.720 --> 0:16:01.600 If interest rates were low, all the buyers would jump 0:16:01.680 --> 0:16:04.400 back in as opposed to the cash buyers having. 0:16:04.120 --> 0:16:07.360 Free ring interesting, so it would kind of give more 0:16:07.640 --> 0:16:10.120 buyers certainly into the market there, all right, Dina, good 0:16:10.120 --> 0:16:12.360 to check in with. You really appreciate it, Dina Golden Tear. 0:16:12.600 --> 0:16:15.520 She's executive director of sales over at Douglas Ellaman. Joining 0:16:15.600 --> 0:16:16.640 us there from Miami. 0:16:18.560 --> 0:16:22.440 You're listening to the Bloomberg Business Week podcast. Listen live 0:16:22.520 --> 0:16:25.440 each weekday starting at two pm Eastern on Apple car 0:16:25.440 --> 0:16:28.400 Play and Android Auto with the Bloomberg Business App. You 0:16:28.440 --> 0:16:31.720 can also listen live on Amazon Alexa from our flagship 0:16:31.760 --> 0:16:35.560 New York station, Just say Alexa play Bloomberg eleven thirty. 0:16:36.720 --> 0:16:39.240 Well, as I mentioned the socks, the Philadelphia semi conductor 0:16:39.280 --> 0:16:41.720 Indeck sitting an all time high today is chipstocks in 0:16:41.800 --> 0:16:45.480 March higher, Broadcom reports after the belt also trading near 0:16:45.560 --> 0:16:48.240 records Carol. At the same time, there are big questions 0:16:48.240 --> 0:16:51.640 about how chip companies are going to navigate Washington's crackdown 0:16:52.040 --> 0:16:54.800 on exports of advanced technologies. That's right. 0:16:54.840 --> 0:16:57.400 Bloomberg was first to report overnight that the US government 0:16:57.520 --> 0:17:01.000 is pressing allies, including the Netherlands, Germany, South Korea, and Japan, 0:17:01.440 --> 0:17:05.240 to further titan restrictions on China's access to semiconductor technology, 0:17:05.520 --> 0:17:09.080 a controversial effort that is drawing resistance in some countries. 0:17:09.119 --> 0:17:11.600 This is at least according to people familiar with that matter. 0:17:11.640 --> 0:17:13.480 To So for what we need to know about how 0:17:13.520 --> 0:17:16.080 companies navigate this delicate balance, we bring in the economic 0:17:16.200 --> 0:17:19.040 historian Chris Miller. He's Associate Professor of International history at 0:17:19.080 --> 0:17:21.879 Tufts University. He's also the author of Chip War, The 0:17:21.960 --> 0:17:24.240 Fight for the World's Most Critical Technology. It's a New 0:17:24.320 --> 0:17:28.280 York Times bestseller. Chris back with us from Boston. Chris, 0:17:28.320 --> 0:17:29.560 good to have you back. How are you. 0:17:31.040 --> 0:17:32.440 Doing well? Thank you for having me back. 0:17:32.520 --> 0:17:34.119 Yeah, well, thanks so much for joining us. We always 0:17:34.119 --> 0:17:35.479 love it when you come on the program. I mean 0:17:35.520 --> 0:17:37.280 talk about timing with your book. It came out in 0:17:37.320 --> 0:17:40.800 twenty twenty two. Since then, the euphoria around chips as 0:17:40.800 --> 0:17:43.560 they relate to AI just has reached fever pitch. I mean, 0:17:43.600 --> 0:17:46.880 look no further than Nvidia super micro computer and more. 0:17:47.400 --> 0:17:50.640 How are you watching this as an academic, as a consultant, 0:17:50.800 --> 0:17:51.560 what are your thoughts? 0:17:53.600 --> 0:17:56.679 Well, you're certainly right that AI has really transformed the 0:17:56.680 --> 0:18:00.680 ship industry. It's the key demand driver go going forward. 0:18:00.720 --> 0:18:04.640 And the big question hanging over AI is when will 0:18:04.680 --> 0:18:08.000 we start to see large scale modernization, How soon will 0:18:08.000 --> 0:18:11.560 that happen? And at what's scaled? Because ultimately, the reason 0:18:11.600 --> 0:18:14.800 why all the hyperscalers are investing tens of billions of 0:18:14.880 --> 0:18:18.920 dollars and building up AI infrastructure and buying lots of 0:18:19.040 --> 0:18:21.680 Nvidia GPUs is because they believe there's money that will 0:18:21.680 --> 0:18:24.040 be made at the end of this process. And that's 0:18:24.080 --> 0:18:27.760 why questions like well how much does Microsoft make off 0:18:27.840 --> 0:18:31.080 Copilot or what does open AI's revenue look like? These 0:18:31.080 --> 0:18:33.679 are the key indicators that investors are looking at to 0:18:33.800 --> 0:18:37.520 assess what will be the implication of AI for corporate profits. 0:18:37.720 --> 0:18:40.439 All right in the tech world, though, sometimes you got 0:18:40.480 --> 0:18:42.480 to build it and then they will come kind of thing. 0:18:42.840 --> 0:18:45.520 Having said that, you've got a socks Chris that was 0:18:45.600 --> 0:18:47.919 up about sixty five percent last year, and let me 0:18:47.960 --> 0:18:49.600 just pull it up on the Bloomberg. But you've got 0:18:50.000 --> 0:18:53.399 the Philadelphia Semiconductor Index up about twenty three percent so 0:18:53.440 --> 0:18:57.080 far here in twenty twenty four. It's just one measurement. 0:18:57.119 --> 0:18:59.440 Maybe it's not the right one. But would you say 0:18:59.480 --> 0:19:02.760 that all the enthusiasm has gotten ahead of itself just 0:19:02.840 --> 0:19:04.840 based on the moves and the share price or it's 0:19:04.840 --> 0:19:07.560 still kind of hard to tell. As I said, you 0:19:07.680 --> 0:19:09.840 need to build it and then they may come. 0:19:11.520 --> 0:19:13.800 Well, I think it does make sense that companies are 0:19:13.800 --> 0:19:17.080 investing very heavily in this infrastructure given all of the 0:19:17.119 --> 0:19:20.160 advances that we've seen in AI and all of the 0:19:20.200 --> 0:19:23.960 product ideas that are currently being tested and explored by 0:19:24.080 --> 0:19:26.520 tech companies, and the infrastructure is expensive, there's no way 0:19:26.560 --> 0:19:28.760 around it, which is why if you're a big tech company, 0:19:28.800 --> 0:19:31.760 you've got to invest literally tens of billions or else 0:19:31.800 --> 0:19:35.000 you fall behind in your data center build out. But 0:19:35.359 --> 0:19:37.880 the question again is going to be how long can 0:19:37.920 --> 0:19:41.879 this be sustained without monetization And the good news is 0:19:41.920 --> 0:19:44.800 that there are early signs that it is possible to 0:19:44.800 --> 0:19:46.520 make money off of AI products. We just need to 0:19:46.520 --> 0:19:49.080 see more evidence of this at more companies to justify 0:19:49.480 --> 0:19:51.120 ongoing expended shares of this level. 0:19:51.200 --> 0:19:53.280 Well, Chris, how do you distinguish between the names in 0:19:53.320 --> 0:19:55.320 the space, and when you talk about monetization and video 0:19:55.359 --> 0:19:56.800 is certainly the one that we bring up right, and 0:19:56.840 --> 0:19:59.680 their numbers continue to surprise to the upside and give 0:19:59.720 --> 0:20:02.280 us some of that affirmation if you will, about maybe 0:20:02.280 --> 0:20:04.760 the potential for AI. It's not just dreams, it's it 0:20:05.200 --> 0:20:07.280 could be a reality because you see it in their numbers. 0:20:07.440 --> 0:20:10.040 Having said that, go back to distinguishing the names in 0:20:10.080 --> 0:20:12.600 the space. You've got the once giants or leaders. I'm 0:20:12.600 --> 0:20:16.040 thinking of Intel, Texas instruments, the new leaders, Nvidia, AMD 0:20:16.200 --> 0:20:19.840 has come so far, the company that seems to stand alone, TSMC, 0:20:21.119 --> 0:20:23.760 the semicon depwork companies, the equipment makers, Like, how do 0:20:23.760 --> 0:20:26.600 you distinguish How should the Bloomberg audience be thinking about 0:20:26.640 --> 0:20:29.280 a space that's got a lot of different names in them. 0:20:30.720 --> 0:20:33.800 Well, the good news is that as AI advances, you 0:20:33.840 --> 0:20:37.560