Speaker 1: Bloomberg Audio Studios, Podcasts, radio news.
Speaker 2: This is the Bloomberg Surveillance Podcast. I'm Tom Keene along
Speaker 2: with Paul Sweeney. Join us each day for insight from
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Speaker 2: the Bloomberg Terminal, and the Bloomberg Business app. In Pimpco
Speaker 2: in Newport Beach. I mean, in the old days, we're
Speaker 2: Bill and Muhammad down at the wedge surfing.
Speaker 3: I see Mohammad across the hall on television right now.
Speaker 3: I'm exciting much.
Speaker 2: Pimco Nexus here. Do you guys surf out of pimp.
Speaker 3: I can't swim. I have a place in the Caribbean.
Speaker 3: I have a place in the Caribbean, Turks and Caicos,
Speaker 3: and I have to wear a life jacket anytime the
Speaker 3: water is above five foot eleven. He's a concrete jungle.
Speaker 3: Any anyone from New York's and Coca. It's all concrete.
Speaker 3: I learned to swim in a fourth above ground pool
Speaker 3: that's twelve feet long, so I really could.
Speaker 1: Paul Saves, let's go to the bonds here.
Speaker 4: I mean, for the longest time, we had no interest
Speaker 4: in talking to the PIMPCO people. Interest rates were zero.
Speaker 4: Now we can can't even get a phone call return
Speaker 4: because everybody wants to talk about bonds here, Tony. We've
Speaker 4: got real interest rates out there. There is some significant
Speaker 4: carry here for a lot of people. What's kind of
Speaker 4: thirty thousand foot view from your perspective at PIMCO, What
Speaker 4: are you telling clients to do with their fix to
Speaker 4: come investments?
Speaker 3: Well, it's like a nirvana for an active bond manager.
Speaker 3: It's like a global bond buffet. There's so much to do.
Speaker 3: It hasn't been in a global bond market in a
Speaker 3: long time because, as you said, interest rates will low,
Speaker 3: and they will low everywhere in the twenty tens near zero,
Speaker 3: pin near zero, so there wasn't much to do. Now
Speaker 3: there's so many things moving around like butterflies. Just simply
Speaker 3: take your net, try to find the good ones and
Speaker 3: put them in your collection. So we'd say that drop
Speaker 3: lower your fears and anxieties. First, I'd say there's three
Speaker 3: things not to do. One, don't try to time the market.
Speaker 3: Yields are high, they look very good, historically very good
Speaker 3: versus expected inflation in the twos and versus what's typical volatility.
Speaker 3: So I'd say, generally speaking, you want to be enamored
Speaker 3: by the bond market opportunities today and lock in today's
Speaker 3: indust rates. It's total return time. It's time to think
Speaker 3: about something beyond the yield potential price gains, and that's
Speaker 3: what total return strategies are. And that could be and
Speaker 3: I don't mean a fund, but I mean the idea
Speaker 3: of potential gains and prices is what you want. And
Speaker 3: to put those yields higher, the returns higher.
Speaker 4: So where do I go, Tony? I mean I could
Speaker 4: just go right outside right now and get it two
Speaker 4: year treasury at four point eight percent?
Speaker 1: Do I do that?
Speaker 4: Or do I go out and maybe take some more
Speaker 4: credit risk here?
Speaker 1: How are you guys thinking about?
Speaker 3: Well, intermediate maturities are probably the sweet spot and the
Speaker 3: Bloomberg aggregate, which is a compilation of lots of bonds.
Speaker 3: It's sort of a market cap weighted index has about
Speaker 3: forty percent US treasuries, twenty five percent agency mortgage backed securities,
Speaker 3: and twenty five percent corporate BONDZI. The average maturity on that,
Speaker 3: or duration and fancy bond language lingo, is around six
Speaker 3: seven years now. I often call those maturities, especially the
Speaker 3: five year, the long bond of the short end. And
Speaker 3: if you think the Federal Reserve is going to be
Speaker 3: lowering short term interest rates, a two year, of course
Speaker 3: will rally, but not as much as the five year will,
Speaker 3: and so that'll really get moving when the Fed.
Speaker 2: Does my chart of the year right now, I haven't
Speaker 2: decided yet, and somebody gave it to me. Thank you
Speaker 2: out on Twitter. I'm stealing it from you. Is the
Speaker 2: yield to worst the old Lehman Barclays now Bloomberg index
Speaker 2: the global yield to worst tony it's about sevens and
Speaker 2: deviations off the Voker Great Moderation. We've had this shift
Speaker 2: in the bond market. Do we recover to some form
Speaker 2: of trend of the Great moderation? Or are we resetting
Speaker 2: a new.
Speaker 3: Vector of the bond market thinks it's the new vector
Speaker 3: looking at so future overnight futures, I think the likelihood
Speaker 3: is that interest rates that the twenty tens is the
Speaker 3: wrong analog for thinking about the future, meaning that it's
Speaker 3: more likely that we go back to the yields of
Speaker 3: past the past than we do the twenty tens, but
Speaker 3: not as high as the market's price. The market thinks
Speaker 3: the FED won't lower as possibly less than four the
Speaker 3: decade Closelue.
Speaker 2: The real solution here, which is iconic in your book, folks,
Speaker 2: is twelve vendred pages only some of the tales Reddit Tony.
Speaker 2: The loop here is the x axis solves everything. Time
Speaker 2: will heal the return to wherever that yield. Yes.
Speaker 3: In fact, the simple ideas that the stated yield is
Speaker 3: of course the likely return. So if you see on
Speaker 3: the Bloomberg aggregate five and an eighth five percent, that's
Speaker 3: likely to be your return over five years, as the
Speaker 3: starting yield is the major determinant of your future returns.
Speaker 3: There are things that could happen, could sprinkle in some
Speaker 3: outph and such, but that's the likely story. And given
Speaker 3: the now, here's really the most important thing to think about.
Speaker 3: Price stability and the FED credibility the ability to knock
Speaker 3: the inflation rate down if you think it's going to
Speaker 3: get the inflation rate into the twos. A yield of
Speaker 3: five historically relative to that is very good. Now, remember
Speaker 3: what Chair Powell said recently was X would you be
Speaker 3: satisfied with inflation of three percent? He said, you shouldn't
Speaker 3: use the word satisfied and three percent in the same sentence.
Speaker 3: And you should believe. And here's the adage, don't fight
Speaker 3: the Fed. Don't fight the FED means believing in its
Speaker 3: eventual success it will be able to get the inflation
Speaker 3: rate below three percent and keep it below. And it
Speaker 3: is already for the gauge of churn.
Speaker 2: We don't care. What's to pretty wild? Did you think?
Speaker 2: Does she think we're going to get to two point xx?
Speaker 2: Like Clarendon?
Speaker 3: They the economics team does. And I give you one
Speaker 3: really strong reason to think this. And I was reading
Speaker 3: back at Irving Fisher nineteen thirty three, Dead Deflation Theory.
Speaker 2: Of Depression Fisher, Irving Fisher, Fisher.
Speaker 3: Irving Fish, trying to understand the Great Depression. The key
Speaker 3: is loan growth. In the end, banks are factories. They
Speaker 3: make money. They're the only entities that can private credit
Speaker 3: entities slash money around that was already in the system.
Speaker 3: And long growth in the United States since the bank
Speaker 3: stress of twenty twenty three really meager two percent in
Speaker 3: Europe flat to negative for the past year and a half.
Speaker 3: You can't have strong spending in the long run with
Speaker 3: note with the factories not printing money.
Speaker 2: I got, I got thirty seconds. Can you put Phil
Speaker 2: Knight into this or Chicago, if you're Fisher, can we
Speaker 2: get Knight or Humping into this?
Speaker 1: Just do it.
Speaker 3: I guess invest in bonds, lock in these swimming cast
Speaker 3: Please someone help me. I can't I do the doggy paddle.
Speaker 3: Within seconds of reaching Lisa took.
Speaker 2: Me from a beginner to an advanced.
Speaker 3: Interviewing red I wear a life jackets six feet out
Speaker 3: in the water.
Speaker 2: We got to work on it. Anthony Crescenzi, thank you
Speaker 2: so much. Thank You's with Pimco. Smart stuff there and yield,
Speaker 2: and we'll get Tiffany Wilding on to straighten out the
Speaker 2: Pimpko dialog. Now is our most important interview of the day.
Speaker 2: Stop what you're doing, and we're going to do this
Speaker 2: very carefully. Lindsay Piegs works for Stifil outlier. I'm kidding,
Speaker 2: that's an economic firm out in the Midwest. And Lindsay
Speaker 2: has staked the ground. If this is a FED, it's
Speaker 2: gonna be higher for longer, and even raise rates. Lindsay
Speaker 2: an update and your research notes it's stephel. Do you
Speaker 2: still believe that your own Powell will need to raise
Speaker 2: interest rates?
Speaker 5: I think right now, looking at the inflationary environment, it's
Speaker 5: clear that inflation is very sticky and will likely remain
Speaker 5: noticeably above the two percent target for quite some time now.
Speaker 5: The Committee should take that as an indication that they
Speaker 5: stop short of a sufficiently restrictive level and take further action,
Speaker 5: meaning re engage in rate hikes. But Tom, I'm not
Speaker 5: confident that they will listening to the latest message. It
Speaker 5: feels as if they'd rather remain on the sidelines, keeping
Speaker 5: this current elevated level of rates in place and wait
Speaker 5: for the improvement to happen more organically.
Speaker 2: The real rate, the ten year real rates would I
Speaker 2: use Lindsay, I'm sure you've got stuff better than me.
Speaker 2: Two point zero eight percent right now, it didn't move
Speaker 2: all that much off this inflation nirvana of the last
Speaker 2: ten days. Where are the tip points? Where's the bracket?
Speaker 2: If you will around the real rate, that will force
Speaker 2: the Fed's.
Speaker 5: Hand, that's a good question, because we didn't see much movement,
Speaker 5: even with the market cheering that cooler than expected CPI number,
Speaker 5: And given the fact that I don't see inflation moving much,
Speaker 5: in fact, nominal rates I think are pretty much range
Speaker 5: bound at this point. It's difficult to say what the
Speaker 5: threshold of pressure will be on the Fed because the
Speaker 5: Fed has been very clear that they're focused on policy easing.
Speaker 5: So unless we saw a material backup in inflation, and
Speaker 5: I don't mean one tens of a percentage point, it
Speaker 5: would probably be in the range of half a percentage point,
Speaker 5: if not more. Only then would the Fed really feel
Speaker 5: as if they're backed up into a corner to take
Speaker 5: further action to re engage. They're going to fight that
Speaker 5: prospect as much as possible as it forces them to
Speaker 5: admit a second policy error on the back end after
Speaker 5: a first round policy error of holding crisis level accommodation
Speaker 5: in place well passed it was appropriate waiting at those
Speaker 5: low levels till March of twenty.
Speaker 4: T lindsay, if the Fed does stay consistent here at
Speaker 4: these levels in terms of the rates, is that going
Speaker 4: to be enough to slow down inflation? Will that be
Speaker 4: perhaps enough to push this economy into maybe a recession,
Speaker 4: which will certainly take care of inflation.
Speaker 5: Well, I do think that at these rates we're going
Speaker 5: to continue to lose momentum. We've already seen the economy
Speaker 5: slow from five percent to three percent let's call it
Speaker 5: at year end, to sub two percent at the start
Speaker 5: of the year, but quarter to quarter volatility aside. I
Speaker 5: do expect the US economy to remain in positive territory
Speaker 5: for twenty twenty four, bouncing around a two ish percent pace.
Speaker 5: That's not enough to bring down inflation in of itself.
Speaker 5: But that being said, momentum is waning. Consumers are feeling pressure,
Speaker 5: businesses are feeling the weight of higher costs, higher borrowing costs. Now,
Speaker 5: at this point, consumers are still spending, businesses are still investing.
Speaker 5: But again it's that second derivative to client, it's that
Speaker 5: loss of momentum. So the bigger question is where do
Speaker 5: we go as we turn the calendar page into twenty
Speaker 5: twenty five, and if we continue to see this loss
Speaker 5: of momentum with growth slowing to maybe a non accelerating pace,
Speaker 5: or at least falling below the bare minimum that you
Speaker 5: would expect for a developed economy, while at that point,
Speaker 5: if the FED is still tolerating above target inflation, my
Speaker 5: bigger concern is not a recession or a downturn, but
Speaker 5: a period of stagflation, slow growth, elevated prices. That's going
Speaker 5: to make it very difficult for the FED to stimulate
Speaker 5: the economy and get us back onto a longer term
Speaker 5: trajectory of prosperity. Given this conundrum of low growth, high inflation,
Speaker 5: that really leaves traditional monetary policy metrics less than robust
Speaker 5: in terms of their impact on the economy.
Speaker 1: He Lindzui.
Speaker 4: This week, we also got a weaker than expected retail
Speaker 4: sales number. Some folks are telling me, don't worry about it.
Speaker 4: We had some good sales numbers out of Walmart yesterday.
Speaker 4: What's your take on this consumer well?
Speaker 5: Certainly exacerbating the market's optimism for nearer term rate cuts
Speaker 5: was that softer than expected consumer spending report, because the
Speaker 5: prospect of slower inflation is certainly more convincing when domestic
Speaker 5: demand appears to be slowing in tandem. But I'm not
Speaker 5: necessarily convinced that that's what we're seeing, a material slow
Speaker 5: down in the consumer as the annual pace still remains
Speaker 5: very solid. So yes, month to month volatility we are
Speaker 5: seeing as consumers shift the groups of services in their basket,
Speaker 5: but on an annual basis, three percent is still indicative
Speaker 5: of a very solid, resilient consumer.
Speaker 2: I agree with you completely, lindsay A really important question.
Speaker 2: If we get a pigs in market and inflation is
Speaker 2: sticky and we have a two part America, do they
Speaker 2: haves the people with assets, do they benefit or are
Speaker 2: they harmed by difficult inflation?
Speaker 5: No, I think we continue to see a growing divide
Speaker 5: between the asset holders and the non asset holders, because
Speaker 5: as long as the market continues to anticipate the FED
Speaker 5: eventually cutting rates, the market eventually focused on this easing
Speaker 5: policy that's going to continue to fuel these asset valuations
Speaker 5: in terms of the equity markets. And then from a
Speaker 5: housing market standpoint, which is the other sizeable component of
Speaker 5: growing these asset valuations, well, that comes down to a
Speaker 5: simple supply and demand. And we came into this housing
Speaker 5: market cycle at a multi year deficit. So just by
Speaker 5: the nature of household formation, population growth, massive flows of immigration,
Speaker 5: it's likely that we continue to see housing demand outpaced supply,
Speaker 5: keeping prices elevated and again perpetuating that divide between asset
Speaker 5: holders and non asset holders.
Speaker 2: Lindsay, thank you so much. Just brilliant, Lindsay, pegs are congratulations.
Speaker 2: I can't say enough, folks. Sir Paul, along with a
Speaker 2: guy named Jackson, invented modern publishing and he was determined
Speaker 2: his show and Mike Bloomberg was a huge participant in
Speaker 2: the show at the National Gallery in London, and it's
Speaker 2: down in Brooklyn right now. You can go see Paul
Speaker 2: McCartney nineteen sixty five black and white photographs, the original.
Speaker 2: They have the original copy of I Want to Hold
Speaker 2: Your Hand. But Paul McCartney changed how musicians worldwide get
Speaker 2: paid single handedly did that with a guy named Michael
Speaker 2: Jackson at ATV Music years ago ATV Music, Yeah, sony
Speaker 2: ATV Music. That was mister Jackson. They owned the known
Speaker 2: world as we know it. This is a joy. Look
Speaker 2: at Shaw darkens the door. We never speak to him
Speaker 2: because he's in LA and gets in at three am.
Speaker 2: You know, the whole thing. And Paul and I are
Speaker 2: really interested in like the death of Hollywood in that
Speaker 2: and yesterday I got a big hug from Michael McCarty
Speaker 2: over at Michael's who's iconic in californ Fournia cuisine and
Speaker 2: it's where you go when you're beautiful. I was supposed
Speaker 2: to go with ger today. I know, you know, girls
Speaker 2: has got to be I'm there with Jumana the other day,
Speaker 2: Jamana Bertucci. Michael's is old, Hollywood is old Hollywood gone.
Speaker 2: Is there anybody darkening the door at McCarty's place anymore?
Speaker 1: In Los Angeles? I would say that the there was
Speaker 1: a there was a generation of chefs that sort of
Speaker 1: typified Hollywood in the eighties, right Michael McCarty, Wolf King, Puck.
Speaker 1: Those people, their restaurants are still open, They're still vibrant.
Speaker 1: They definitely appeal to an older clientele. I don't think
Speaker 1: that if you were to Lisa wouldn't go, you know,
Speaker 1: if you were to talk to the people running some
Speaker 1: of the studios or maybe the new stars, because the
Speaker 1: fact is most of the people running the studios in
Speaker 1: Hollywood are the Michael's demographic. I mean, that's one of
Speaker 1: the complaints in the business right now, is that Hollywood
Speaker 1: is being run by people in their sixties and seventies,
Speaker 1: and they're not a lot of opportunities for people in
Speaker 1: their thirties and forties to have a chance to make
Speaker 1: some changes.
Speaker 2: Right, We've been talking about mister Ripley and you know
Speaker 2: within your magnificent nos folks, look show on a high
Speaker 2: ground Sunday once it come out.
Speaker 1: Sunday, Sunday, three pm Pacific.
Speaker 2: Do you have your interns type it or you know?
Speaker 1: How's that word right? Every word?
Speaker 2: Okay, we've been talking about I hope I'm pronouncing right,
Speaker 2: Steven Zalien and mister Ripley.
Speaker 1: Yeah, he did.
Speaker 2: Shindler's List, He's done all this.
Speaker 1: Stuff, legendary screenwriter.
Speaker 2: Now tell us about that person in the New Hollywood
Speaker 2: that we see dying when you look at the stock prices.
Speaker 1: Well, if you think about that show, and I think
Speaker 1: I'm getting this right, that show is initially set up
Speaker 1: at Showtime and then when Paramount basically killed Showtime or
Speaker 1: folded it into Paramount Plus, that the new boss of
Speaker 1: Paramount Plus with Showtime, Chris McCarthy, who's now the co
Speaker 1: CEO of Paramount, I think, decided it wasn't the best
Speaker 1: fit for what they were trying to do. Strategically, look
Speaker 1: black and white period piece. I get it. It doesn't
Speaker 1: scream commercial and Netflix, Switch has more money than almost
Speaker 1: anyone else to take some risks and pick things up.
Speaker 1: Swooped in and took it. Look, I don't think that
Speaker 1: show's a huge hit for that, but it certainly is
Speaker 1: beloved artistically, and we'll see if it gets a bunch
Speaker 1: of Emmy nominations when those come out over the summer.
Speaker 4: So, Lucas, one of the things Tom and I talk
Speaker 4: about a lot is just kind of where we go
Speaker 4: here going forward from the media industry perspective, the business.
Speaker 4: I grew up in the media business. Everybody made money,
Speaker 4: everybody made money. Now those economics are really up.
Speaker 1: For grad very challenged. Yeah, and do you think the.
Speaker 4: Traditional media companies in Hollywood? You live there, you're seeing
Speaker 4: it every day, are they prepared to make that pivot?
Speaker 4: I'm thinking Paramount, I'm thinking Warner Brothers, Discovery. What's the
Speaker 4: feeling in Hollywood in LA about that?
Speaker 1: I mean, look, the mood is pretty dour at the moment,
Speaker 1: because you see, the word for a year or two
Speaker 1: now has been sort of efficiency and economy and trying
Speaker 1: to cut back and save money. Right. You just had
Speaker 1: Bob Iger come out earlier this week at an investor
Speaker 1: conference and say we spent too much money launching Disney Plus.
Speaker 1: Now I think that's up for debate. They probably spent
Speaker 1: an appropriate amount of money. But there's no question that
Speaker 1: you had a lot of companies, and especially the traditional ones,
Speaker 1: that were seeing their cable networks shrivel, and so they
Speaker 1: spent all this money on streaming and they haven't been
Speaker 1: able to make it a profitable business. Then they didn't
Speaker 1: necessarily have the right approach, and so now everyone's pulling
Speaker 1: back and everyone is scared about that because it's much much,
Speaker 1: much harder to get a project made than it used
Speaker 1: to be.
Speaker 4: Let's talk just about Powermount.
Speaker 1: That's the number one.
Speaker 2: What happens this weekend, Lucas.
Speaker 4: I keep telling Tom five years ago, I could have
Speaker 4: sold that company with three phone calls.
Speaker 1: Now you can't give it away. Well, we will probably
Speaker 1: have an update on that later this morning.
Speaker 2: I listen to Lucas Wispy.
Speaker 1: But you're correct that. Look, it's not the most attractive
Speaker 1: business for people, right you know, it has it's the
Speaker 1: way it still makes all of its money for the
Speaker 1: most part is these cable networks that are getting smaller
Speaker 1: every year. It has a streaming business that's growing but
Speaker 1: doesn't make any money, and it has one of the
Speaker 1: weaker film and television studios around. And so you know,
Speaker 1: you've got David Ellison who has a lot of money
Speaker 1: and father. His father has a lot of money. He's
Speaker 1: now built a decent sized media business. He wants to
Speaker 1: buy it. I think partially because it would make skuy
Speaker 1: Dance much bigger and build in the studio, but also
Speaker 1: because there's legacy there. Most of the other folks who'd
Speaker 1: be interested, you'd, yeah, you'd be buying it almost because
Speaker 1: you like the history of Paramount, not because it's a
Speaker 1: great business.
Speaker 2: In the crushing lack of time that we have, because
Speaker 2: you refuse to get up at three am, Lucas Shaw.
Speaker 2: Does Tim Cook want to be in Hollywood? Does Jesse
Speaker 2: of Amazon want to be in Hollywood? Does Satya up
Speaker 2: north there in Washington? Do those tech people really want
Speaker 2: to play the Michaels lunch game.
Speaker 1: I think it depends on how you define Hollywood. So Satya, Nadella,
Speaker 1: and Microsoft they're in entertainment right, They're one of the
Speaker 1: biggest video game companies in the world. I don't think
Speaker 1: they're especially interested in the film and television business. Sort
Speaker 1: of classic Hollywood. Amazon is in it. You know, they
Speaker 1: have a I don't know that they're going to invest
Speaker 1: at the same level as Netflix, but you know they
Speaker 1: have a bunch of sports rights. They're spending billions of
Speaker 1: dollars on programming. Their prime video business is one of
Speaker 1: the largest in the world. Apple is sort of the
Speaker 1: big question mark. They have invested a bunch of money,
Speaker 1: but I don't think they're they're going to go buy
Speaker 1: a studio.
Speaker 2: Paul's upset is Christmas NFL football un American.
Speaker 1: Why they have Christmas NBA basketball?
Speaker 2: Right?
Speaker 4: So what happens here with sports? I mean Netflix, they're
Speaker 4: starting to go into sports. I mean, one could argue
Speaker 4: that the future of sports revenue and the value of
Speaker 4: all these franchises and all these big contracts, it's going to.
Speaker 1: Be paid out of Silicon Valley, not Hollywood. Well, right now,
Speaker 1: the leagues are sort of have the best of both worlds.
Speaker 1: Right There was a while in scripted entertainment where you
Speaker 1: had broadcast and cable networks and streaming services and just
Speaker 1: all this money being spent, and that's sort of where
Speaker 1: we are with sports right now. You look at the NFL,
Speaker 1: they're in business with CBS, NBC, ABC, Fox, Amazon, YouTube
Speaker 1: and Netflix. That's a pretty good place to be.
Speaker 6: The venue sports, the venue sports that just came out.
Speaker 1: Oh they Yeah, I'm pretty skeptical of that business.
Speaker 2: Last question, we are a walking experiment of YouTube and
Speaker 2: YouTube TV. What we're doing your Bloomberg surveillance? Yeah on
Speaker 2: YouTube right now? What's the power of YouTube combined with
Speaker 2: YouTube TV five years forward? Are we going to have
Speaker 2: jobs in five years? Yeah?
Speaker 1: Because you're you're you're living proof that YouTube is a
Speaker 1: powerful medium. YouTube is the biggest media media company in
Speaker 1: the world and the most powerful one.
Speaker 2: Keep it up.
Speaker 1: YouTube TV is also going to probably become the biggest
Speaker 1: PATV distributor in this country in the next five years.
Speaker 1: So yeah, I think you're you're in good hands if
Speaker 1: you're in business with you.
Speaker 2: Is it monetarizing for Google? Like, are they minting money
Speaker 2: on it every day?
Speaker 1: I don't know that it's profitable because they spend a
Speaker 1: fortune on it. They only break it. They only break.
Speaker 2: Out the Chanel dress yesterday.
Speaker 1: Even you wise, YouTube is bigger than Netflix. You canbine
Speaker 1: advertising and subscription. It's a massive business, just not as profitable.
Speaker 2: Okay, so paramount we should pay attention this morning.
Speaker 1: Is that it will be an incremental update, but it
Speaker 1: will be an update incremental.
Speaker 2: And did you go to the upfronts this week?
Speaker 1: I went to a few of them yes.
Speaker 2: Day, Lucashaw with Mark German. All I can say, folks
Speaker 2: is we have a series of newsletters out begin with
Speaker 2: Lucashaw and Mark German on Apple. I just can't say
Speaker 2: enough about the legit expertise he's writing it. He's got
Speaker 2: four interns from Pepperdine one of them one of them
Speaker 2: is a surf stud and they're writing at Popping Up,
Speaker 2: getting it out Saturday or Sunday. Lucashaw, thank you for
Speaker 2: the visiting. She's got seventy seven papers at her desk,
Speaker 2: its stacked up. You can barely see Lisa at five
Speaker 2: am putting this together your daily look at the front pages, Lisa,
Speaker 2: what do you got?
Speaker 6: Okay, you're gonna like this one. Cassette ta making a comeback?
Speaker 5: Yes, okay.
Speaker 6: I still collection those in the music because they say
Speaker 6: the majority is not the older generations, but it's a
Speaker 6: younger generation. Because shows like Stranger Things, Guardians and The
Speaker 6: Galaxy that feature cassettes like in their shows and movies
Speaker 6: that's sparking that younger generation. Taylor Swift, she's sold twenty
Speaker 6: one five hundred cassettes from her latest release. But you
Speaker 6: have Billie Eilish, Dua Lipa, Kendrick Lamar. They're all going to.
Speaker 4: Cassette cassette players stage.
Speaker 6: That's they're finding the cassette player. But the reason why,
Speaker 6: I'm like, so, what's the thing. So artists are saying
Speaker 6: that lower production costs Okay, new releases on vinyl can
Speaker 6: cost about thirty five cassettes as low as ten dollars,
Speaker 6: But they're also saying cassette sales had a bigger impact
Speaker 6: on chart position. I'm not sure how that plays out.
Speaker 2: I mean, I get the vinyl thing. I mean I don't.
Speaker 2: I don't. I'd rather listen to title or something incredibly
Speaker 2: beautifully done digital, particularly through tubes, But I get vinyl. Paul,
Speaker 2: remember the celebration when we got rid of cassettes.
Speaker 4: Well, going from a track to cassettes, well that was evolution.
Speaker 4: Tucker's still using a Trex to cassettes was like unbelievable
Speaker 4: technological beside.
Speaker 2: Yeah, and then Dolby d Dolby, Yes, Dolby Dolby Dolby
Speaker 2: and the answers. It sucks.
Speaker 6: I just hated when you had when it came out
Speaker 6: and then you had to take your pencil and like
Speaker 6: go like exactly.
Speaker 2: So if I go to if I go to Brooklyn
Speaker 2: this week and there's going to be somebody in a
Speaker 2: two hundred dollars plaid shirt, David telling me I need
Speaker 2: to buy cassettes.
Speaker 1: You gotta buy Himura does this?
Speaker 2: I think it's a big take. Comes up our low
Speaker 2: fight with David.
Speaker 6: Next, when you go to the airport, here's the thing
Speaker 6: and you do you bring your car? Do you take
Speaker 6: an Uber driver?
Speaker 2: What do you? What do you do?
Speaker 4: Never once have I driven to the aircraft in my
Speaker 4: professional life?
Speaker 2: Did I read? That? Is your story that it's.
Speaker 6: Like parking is packed, people can't find spots. There's are
Speaker 6: those receive flights. Well, I know when we go sometimes
Speaker 6: will bring our are because if you factor in we
Speaker 6: need the extra large you know, Uber. And then to
Speaker 6: go back and forth. Let's say we're going to JFK
Speaker 6: or somewhere really far. It's going to cause us ridiculous,
Speaker 6: but it's cheaper to take the daily rate and leave
Speaker 6: it really and then you can you know, kind of
Speaker 6: leave at your will. You know, you can just kind
Speaker 6: of go. We do it like the outside of the
Speaker 6: airport parking, so it's a little bit even cheaper than
Speaker 6: the actual I always wondered too, did that but.
Speaker 2: Are they going to raise the price or build more parts?
Speaker 6: So they're trying to build more parking, that's one of
Speaker 6: the things the airports. They're also working to install these
Speaker 6: guidance systems that help direct you to open spots so
Speaker 6: that people don't wind up missing their flights because that's
Speaker 6: the problem. And then Memorial Days around the corner, so
Speaker 6: they're trying to put out this warning to people like, hey,
Speaker 6: you know, you better book your spot ahead of time,
Speaker 6: which you can also just don't get it.
Speaker 2: I have no idea.
Speaker 4: That's why I learned, so you don't have to do this.
Speaker 2: I mean, I had no ideas.
Speaker 6: Live five miles because you have your points on Southwest,
Speaker 6: which don't getting.
Speaker 1: Your points on United.
Speaker 2: You know, I wonder if Charlie pell AT's surveillance Europe
Speaker 2: on five dollars question, Ye, I wonder pellet his opinion.
Speaker 6: Okay, TikTok is testing out sixty minute videos for its app,
Speaker 6: so that's going to put it in competition with YouTube,
Speaker 6: So that's the thing that they're working on now. It's
Speaker 6: a big thing because longer video uploads means more competition
Speaker 6: for a lot of the streaming services. But it's not
Speaker 6: clear when or when this is going to happen. It
Speaker 6: is kind of in this testing out phase. Is from
Speaker 6: Business Insider, So it'll be interesting to see because you know,
Speaker 6: we did. We've heard so much about YouTube and how
Speaker 6: you know it's at the top of of streaming. But
Speaker 6: now if TikTok starts putting out these sixty minute videos,
Speaker 6: will that start to put it in competition with the
Speaker 6: other streaming services.
Speaker 1: I don't know why they wouldn't.
Speaker 4: Actually, I don't know why they wouldn't because the advertising
Speaker 4: dollars are out there. First of all, as you mentioned
Speaker 4: from that data we saw from Nielsen earlier this week,
Speaker 4: YouTube is a second and most visited video source in
Speaker 4: the marketplace after the Walt Disney Company and all their channels.
Speaker 4: So people are really spending a ton of time on
Speaker 4: YouTube and YouTube selling advertising against that audience. I think TikTok,
Speaker 4: assuming it could stay in its current ownership, would think
Speaker 4: about doing the same.
Speaker 6: Wow, would surveillance have to go on, TikTok, we could
Speaker 6: do that.
Speaker 2: Not gonna happen. Take a note, Rich, ain't gonna happen.
Speaker 2: Let's move on.
Speaker 1: Okay.
Speaker 6: We talked about this yesterday because I was wearing this
Speaker 6: dress when I walked in and you commented on Tommy,
Speaker 6: you said, everybody ever got a TJ Max.
Speaker 2: You know, she's not a Harper's Bazaar.
Speaker 6: So the Wall Street Journal actually put out a story
Speaker 6: about this whole thing, how tj X Hall's becoming this
Speaker 6: badge of honors. I mean, you have people like Bethany Frankel,
Speaker 6: you know, she's going to TJ max in there looking
Speaker 6: for these different things. And we're talking Valentino coach goose.
Speaker 4: Valentino prop to get the TJX it doesn't sell in Bloomingdale's,
Speaker 4: and then it would go to TGX. Maybe they're usually
Speaker 4: the older model the next season if it doesn't sell
Speaker 4: in Bloomingdale.
Speaker 6: Exactly, exactly. So that's why you got my Calvin Kleine
Speaker 6: dress for thirty dollars.
Speaker 4: That is amazing.
Speaker 2: I mean, when Cavia Mateo hour.
Speaker 4: Exactly, Calvin Clin think Lisa Mitaylo's gonna be wearing my
Speaker 4: dress at thirty dollars.
Speaker 2: This started in Boston, and I have the clear memory
Speaker 2: of TJ Max being different, and they've become ever more different.
Speaker 2: Like you say, and the pros Dana Telsey, Joe Feldman,
Speaker 2: Oliver Chen and others. Robert Burke's who's ginormous within retail consulting,
Speaker 2: they will tell you there's always been a halo around
Speaker 2: TJ Max. I don't understand it. I think I was
Speaker 2: in one when Nixon was president. But you know, all
Speaker 2: I know is the pros say they're different.
Speaker 1: Just big company.
Speaker 4: It's got one hundred and twelve billion dollar market cap.
Speaker 4: It's up five percent this year. The stock is sub
Speaker 4: twenty seven percent over the past year. So it's done
Speaker 4: well in a tough retail.
Speaker 6: Yet one more, it's Marshall's, It's Home Goods. All of
Speaker 6: them are all TJX.
Speaker 2: Is you that one more? No?
Speaker 6: No, I'm going to TJ maxxisque.
Speaker 1: I'll post some pictures for you.
Speaker 2: I think Valentino. But you know, actually I sort of
Speaker 2: see Celene, you know, I could see Lisa, you know
Speaker 2: Rock and Selene.
Speaker 4: Yeah, yeah, absolutely, I mean I didn't know Lisa Mateo.
Speaker 2: Lisa Mateo in charge of the newspapers on this Friday.
Speaker 2: This is a Bloomberg Surveillance podcast, bringing you the best
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