1 00:00:02,520 --> 00:00:07,000 Speaker 1: Bloomberg Audio Studios, podcasts, radio News. 2 00:00:07,800 --> 00:00:11,800 Speaker 2: That's pretty amazing how quickly and how dramatically sentiment shifted. 3 00:00:11,880 --> 00:00:12,200 Speaker 1: Romaine. 4 00:00:12,280 --> 00:00:15,520 Speaker 2: Yesterday we were talking about the buy everything rally, and now, 5 00:00:15,560 --> 00:00:17,840 Speaker 2: as you say at the top of the show, everything 6 00:00:17,880 --> 00:00:20,480 Speaker 2: that has a risk profile is being sold right now, a. 7 00:00:20,400 --> 00:00:22,279 Speaker 1: Bit of a sell everything rally. In fact, we're hitting 8 00:00:22,280 --> 00:00:24,600 Speaker 1: fresh session lows as we speak. And I just want 9 00:00:24,640 --> 00:00:26,119 Speaker 1: to pin at Katie. I mean, we talk about the 10 00:00:26,160 --> 00:00:28,920 Speaker 1: superlatives in this market for most of the major indices. 11 00:00:28,960 --> 00:00:31,840 Speaker 1: We're talking about the biggest drop one day drop since 12 00:00:32,120 --> 00:00:34,800 Speaker 1: well April, yeah, which of course is right around the 13 00:00:34,840 --> 00:00:35,680 Speaker 1: Liberation Day. 14 00:00:36,080 --> 00:00:36,640 Speaker 3: O juitah. 15 00:00:36,800 --> 00:00:38,520 Speaker 1: That sort of bubbled up and then it just seemed 16 00:00:38,520 --> 00:00:40,560 Speaker 1: like the last few months it just kind of people 17 00:00:40,600 --> 00:00:43,040 Speaker 1: forgot about tariffs, or they say we're comfortable with where 18 00:00:43,080 --> 00:00:45,640 Speaker 1: the tariffs were, until we got a truth social post 19 00:00:45,680 --> 00:00:46,400 Speaker 1: earlier this morning. 20 00:00:46,479 --> 00:00:46,879 Speaker 3: That's the thing. 21 00:00:46,920 --> 00:00:49,920 Speaker 2: The noise had definitely been turned down when it came 22 00:00:49,960 --> 00:00:53,080 Speaker 2: to the tariff conversation. Now, of course coming back in 23 00:00:53,120 --> 00:00:55,840 Speaker 2: a big way. You have the truth social post from 24 00:00:56,040 --> 00:00:59,360 Speaker 2: President Trump there right now basically saying that he's not 25 00:00:59,400 --> 00:01:01,440 Speaker 2: even sure if you there's a reason to meet with 26 00:01:01,520 --> 00:01:03,640 Speaker 2: President g in two weeks, and a lot of hopes 27 00:01:03,920 --> 00:01:05,600 Speaker 2: had been pinned to that conversation. 28 00:01:05,800 --> 00:01:07,880 Speaker 1: Yeah, and in fairness to the President, I mean, as 29 00:01:07,880 --> 00:01:09,680 Speaker 1: you know, he does fire off these missives kind of 30 00:01:09,680 --> 00:01:11,399 Speaker 1: on a whim. But we should point out that China 31 00:01:11,440 --> 00:01:13,760 Speaker 1: has actually taken a lot of measures over the last 32 00:01:13,959 --> 00:01:16,200 Speaker 1: few days. I mean, in fact the last few hours, 33 00:01:16,200 --> 00:01:21,080 Speaker 1: including more restrictions on the export of rare earth, potential investigation, 34 00:01:21,240 --> 00:01:23,800 Speaker 1: anti trust investigation into Qualcomm, and. 35 00:01:23,760 --> 00:01:25,120 Speaker 3: A couple other things that I'm forgetting. 36 00:01:25,120 --> 00:01:28,000 Speaker 1: So there's been some concern here. The China itself has 37 00:01:28,080 --> 00:01:30,840 Speaker 1: kind of ratcheted up the pressure, and maybe that's why 38 00:01:30,880 --> 00:01:33,000 Speaker 1: Trump felt the need to do it. You know, I 39 00:01:33,040 --> 00:01:34,720 Speaker 1: had his chance to sit down with John Rogers. 40 00:01:35,000 --> 00:01:36,000 Speaker 2: I heard about that. 41 00:01:36,200 --> 00:01:38,960 Speaker 1: Yeah, he runs an era, co founded Aerial Investments, and 42 00:01:39,000 --> 00:01:40,920 Speaker 1: I actually had a chance to talk to him about 43 00:01:40,959 --> 00:01:43,959 Speaker 1: a wide range of things, including his thoughts here on 44 00:01:44,080 --> 00:01:44,919 Speaker 1: the terror picture. 45 00:01:45,040 --> 00:01:46,480 Speaker 3: Take a listen as to what he had to say. 46 00:01:49,080 --> 00:01:52,200 Speaker 4: We're still finding ideas in small value space. 47 00:01:52,760 --> 00:01:54,520 Speaker 3: You know, they really have been ignored. 48 00:01:54,600 --> 00:01:57,000 Speaker 4: They're kind of the ugly ducklings when you compare it 49 00:01:57,040 --> 00:02:00,760 Speaker 4: to Nvidia and Apple and all these jobs and exciting 50 00:02:00,800 --> 00:02:01,680 Speaker 4: growth stories. 51 00:02:01,960 --> 00:02:03,680 Speaker 3: You know, the little mundane. 52 00:02:03,200 --> 00:02:06,360 Speaker 4: Businesses that we've invested in for forty two years just 53 00:02:06,880 --> 00:02:11,359 Speaker 4: seem particularly orphaned these days. So we're seeing great ideas 54 00:02:11,440 --> 00:02:14,079 Speaker 4: and excited to be doing the research and think there's 55 00:02:14,120 --> 00:02:16,200 Speaker 4: real opportunity for small value. 56 00:02:16,280 --> 00:02:20,639 Speaker 1: Do you see a broader future for investment in that 57 00:02:20,720 --> 00:02:23,680 Speaker 1: sort of entertainment space? And I guess it's more given 58 00:02:23,760 --> 00:02:25,760 Speaker 1: what the sphere in MSU do. It's just a little 59 00:02:25,800 --> 00:02:27,920 Speaker 1: bit more of a hybrid entertainment space. But I am 60 00:02:27,960 --> 00:02:30,760 Speaker 1: curious as to what additional value you find there. 61 00:02:31,639 --> 00:02:32,800 Speaker 3: Well, everywhere we. 62 00:02:32,760 --> 00:02:35,480 Speaker 4: Go, we talk to as many experts as we can 63 00:02:35,520 --> 00:02:38,400 Speaker 4: as part of our regular research and due diligence, and 64 00:02:38,480 --> 00:02:41,400 Speaker 4: everyone is saying, you know, post COVID, it's really is 65 00:02:41,440 --> 00:02:45,919 Speaker 4: sticking that the next generation of citizens here, particularly in America, 66 00:02:46,080 --> 00:02:47,240 Speaker 4: love experiences. 67 00:02:47,520 --> 00:02:48,240 Speaker 3: They want to go. 68 00:02:48,280 --> 00:02:52,280 Speaker 4: Out and be together to watch a ballgame, watch a movie, 69 00:02:53,000 --> 00:02:56,160 Speaker 4: go to a concert, go to an outsdoor stadium to 70 00:02:56,160 --> 00:02:58,760 Speaker 4: see music. It's something that is really I think here 71 00:02:58,800 --> 00:03:01,960 Speaker 4: to stay. The moment mentum is continuing to hold, and 72 00:03:02,000 --> 00:03:04,480 Speaker 4: so places like the sphere that has this you know, 73 00:03:04,880 --> 00:03:08,640 Speaker 4: magical IP people want to come and experience it together. 74 00:03:08,840 --> 00:03:11,440 Speaker 4: And I think it's really special. I think the Wizard 75 00:03:11,480 --> 00:03:15,000 Speaker 4: of Oz is just scratching the surface. It's absolutely amazing 76 00:03:15,040 --> 00:03:17,760 Speaker 4: and exciting to go to. But there will be other exciting, 77 00:03:17,800 --> 00:03:21,200 Speaker 4: amazing things. Everyone speculates, well maybe one day, you know, 78 00:03:21,240 --> 00:03:24,239 Speaker 4: it could be Star Wars, maybe it could be Harry Potter. 79 00:03:24,680 --> 00:03:27,280 Speaker 3: You never know what could be next. But those are 80 00:03:27,280 --> 00:03:27,880 Speaker 3: the kind of things. 81 00:03:27,800 --> 00:03:30,920 Speaker 4: That people want to come and appreciate in a live audience. 82 00:03:31,360 --> 00:03:34,720 Speaker 1: You're no stranger to investing in the entertainment space, and 83 00:03:35,160 --> 00:03:39,000 Speaker 1: at least prior to the tie up with Paramount sky Dance, 84 00:03:39,120 --> 00:03:41,920 Speaker 1: you were one of the largest shareholders in Paramount. Now 85 00:03:41,920 --> 00:03:44,720 Speaker 1: that that deal is done, now that David Ellison has 86 00:03:44,800 --> 00:03:47,119 Speaker 1: laid out his vision for what he wants to do 87 00:03:47,200 --> 00:03:49,800 Speaker 1: with that company, I am curious as to whether you 88 00:03:49,920 --> 00:03:53,800 Speaker 1: think that it can be not just profitable, but also 89 00:03:53,960 --> 00:03:54,920 Speaker 1: a growth story. 90 00:03:54,960 --> 00:03:59,000 Speaker 4: Again, well, that's still an open question. You know, it's 91 00:03:59,040 --> 00:04:02,520 Speaker 4: been a torture experience. I still think for sure there's 92 00:04:02,560 --> 00:04:05,680 Speaker 4: a lot of value there. You know, Paramount Studio is valuable, 93 00:04:05,800 --> 00:04:09,839 Speaker 4: CBS is valuable, they're you know, still number one year 94 00:04:09,920 --> 00:04:12,960 Speaker 4: after year with their content. You look at all the 95 00:04:12,960 --> 00:04:15,960 Speaker 4: different things, and of course Paramount Plus and Pluto. They 96 00:04:15,960 --> 00:04:18,840 Speaker 4: have these extraordinary assets, and so the stock I think 97 00:04:18,920 --> 00:04:22,600 Speaker 4: is still you know, significantly undervalued. Now whether they can 98 00:04:22,600 --> 00:04:24,960 Speaker 4: get the growth they hope To your question, that's a 99 00:04:25,080 --> 00:04:27,240 Speaker 4: that's still an open question because you're, you know, you're 100 00:04:27,279 --> 00:04:30,720 Speaker 4: competing with Netflix, You're competing with all the big guys, 101 00:04:30,880 --> 00:04:34,240 Speaker 4: Apple and Amazon, et cetera. And whether you can grow 102 00:04:34,240 --> 00:04:37,320 Speaker 4: in that environment is something that's really still an open question. 103 00:04:38,320 --> 00:04:41,760 Speaker 4: I think mister Ellison has the right idea of you know, 104 00:04:41,880 --> 00:04:46,240 Speaker 4: building scale, you know, building ip, making these acquisitions that 105 00:04:46,520 --> 00:04:50,200 Speaker 4: can really add value and hopefully potentially add significant growth 106 00:04:50,680 --> 00:04:52,200 Speaker 4: from revenue and profitability. 107 00:04:52,560 --> 00:04:55,760 Speaker 1: To that point on scale, does a deal like one 108 00:04:56,200 --> 00:04:59,160 Speaker 1: for Warner Brothers Discovery, should that actually come to fruition? 109 00:04:59,520 --> 00:05:01,440 Speaker 1: Does that se smart to you in terms of the 110 00:05:01,520 --> 00:05:04,159 Speaker 1: cost and what it would actually bring to paramount? 111 00:05:05,520 --> 00:05:07,680 Speaker 4: Well, I've been reading a lawful a lot about it 112 00:05:07,720 --> 00:05:10,200 Speaker 4: and talking again to as many experts as possible. I 113 00:05:10,200 --> 00:05:14,440 Speaker 4: think that acquisition makes a lot of sense. It brings scale, 114 00:05:14,560 --> 00:05:16,680 Speaker 4: as you suggest, it'll make them one of the major 115 00:05:16,720 --> 00:05:20,200 Speaker 4: players that will be there forever. And at the same time, 116 00:05:20,240 --> 00:05:23,880 Speaker 4: there's huge synergies, you know, huge cost cuts that are available. 117 00:05:24,160 --> 00:05:26,680 Speaker 4: You have two major studios. Maybe you could sell one 118 00:05:26,720 --> 00:05:29,680 Speaker 4: of the studios and the studio a lot and all 119 00:05:29,680 --> 00:05:32,960 Speaker 4: the real estate value that's there. But also just again 120 00:05:33,000 --> 00:05:36,440 Speaker 4: an extraordinary amount of synergies that are there, extraordinary amount 121 00:05:36,480 --> 00:05:39,760 Speaker 4: of cost cutting that's there, and we put it all together, 122 00:05:41,160 --> 00:05:43,320 Speaker 4: I think there's this real potential of immergier like that 123 00:05:43,360 --> 00:05:43,920 Speaker 4: would happen. 124 00:05:44,040 --> 00:05:45,880 Speaker 1: I do just have to ask you just about the 125 00:05:45,880 --> 00:05:49,080 Speaker 1: political climate, because that's sort of driving some of those 126 00:05:49,120 --> 00:05:51,560 Speaker 1: divisions these days. And I know in the past you've 127 00:05:51,560 --> 00:05:54,680 Speaker 1: said that you're still hopeful for America, still hopeful for 128 00:05:54,800 --> 00:05:57,880 Speaker 1: our economy and our markets. But when you look at 129 00:05:57,920 --> 00:06:00,280 Speaker 1: what's going on, particularly in the city where you sit, 130 00:06:00,360 --> 00:06:03,440 Speaker 1: where Aerial sits in Chicago, which has been the subject 131 00:06:04,040 --> 00:06:06,359 Speaker 1: of some of the ire out of the White House, 132 00:06:06,920 --> 00:06:07,840 Speaker 1: what do you make of it? 133 00:06:09,480 --> 00:06:12,000 Speaker 4: I just think it doesn't make any sense at all. 134 00:06:12,200 --> 00:06:16,080 Speaker 4: You know, the city has never been more beautiful, it's 135 00:06:16,160 --> 00:06:20,480 Speaker 4: never been you know, the safety issues are drifting away. 136 00:06:20,720 --> 00:06:22,239 Speaker 3: The violence is going down. 137 00:06:22,800 --> 00:06:25,200 Speaker 4: You know, we've had extraordinary leaders here who've worked to 138 00:06:25,240 --> 00:06:28,479 Speaker 4: build our city back from times where it was somewhat troubled. 139 00:06:28,839 --> 00:06:31,160 Speaker 4: But we know Mayor Johnson's done a great job. 140 00:06:31,360 --> 00:06:33,599 Speaker 3: JB. Pritzker has done a great job. You know. 141 00:06:33,920 --> 00:06:37,039 Speaker 4: Former Secretary of Education Arnie Duncan with his CRED program, 142 00:06:37,120 --> 00:06:40,839 Speaker 4: the Anti Violence Initiative have made a major difference in 143 00:06:40,880 --> 00:06:44,960 Speaker 4: our business community. Our civic committee headed up by Derek Douglass. 144 00:06:45,360 --> 00:06:51,040 Speaker 4: Everyone's come together and we're fully online together. We have 145 00:06:51,160 --> 00:06:53,640 Speaker 4: the same perspective that our city is really on the 146 00:06:53,680 --> 00:06:54,120 Speaker 4: way back. 147 00:06:54,200 --> 00:06:54,919 Speaker 3: Things are great. 148 00:06:55,040 --> 00:06:57,479 Speaker 1: We got additional headlines out of the White House with 149 00:06:57,560 --> 00:07:02,559 Speaker 1: regards to tariffs, potentially more tariffs on China, largely because 150 00:07:02,600 --> 00:07:05,840 Speaker 1: the President says that he doesn't think Jijiping is cooperating 151 00:07:05,960 --> 00:07:10,040 Speaker 1: enough in the negotiations. Being a small and mid cap investor, 152 00:07:10,120 --> 00:07:12,480 Speaker 1: particularly with some names that I would assume would have 153 00:07:12,600 --> 00:07:15,960 Speaker 1: tariff exposure like Mattel, does it give you a little 154 00:07:16,000 --> 00:07:18,000 Speaker 1: bit of concern that we still have not sort of, 155 00:07:18,280 --> 00:07:21,320 Speaker 1: I guess, reached some sort of resolution on where we're 156 00:07:21,360 --> 00:07:24,120 Speaker 1: actually going with these tariffs, what they will be, and 157 00:07:24,160 --> 00:07:25,320 Speaker 1: what we can count on them to be. 158 00:07:27,160 --> 00:07:29,000 Speaker 4: Well, none of us that are work in the Marcus 159 00:07:29,080 --> 00:07:31,440 Speaker 4: day to day like to see We don't like to 160 00:07:31,440 --> 00:07:34,520 Speaker 4: see the volatility. We don't like to see the surprises. 161 00:07:34,840 --> 00:07:39,360 Speaker 4: You know, we're looking for stability, and this is kind 162 00:07:39,360 --> 00:07:42,040 Speaker 4: of a fragile atmosphere with what ever's going on around 163 00:07:42,040 --> 00:07:43,440 Speaker 4: the world all. 164 00:07:43,280 --> 00:07:44,320 Speaker 3: The challenges that we face. 165 00:07:45,240 --> 00:07:48,120 Speaker 4: Having these challenges domestically around the tariffs is something I 166 00:07:48,160 --> 00:07:49,640 Speaker 4: think is really problematic. 167 00:07:49,760 --> 00:07:52,840 Speaker 1: We've also seen a revival in deal making, John that 168 00:07:52,880 --> 00:07:55,720 Speaker 1: we didn't necessarily see definitely coming out of last year, 169 00:07:55,760 --> 00:07:58,320 Speaker 1: and at the start of this year. You are Ariel 170 00:07:58,440 --> 00:08:02,480 Speaker 1: and your funds are investors in names like Carlisle, Lazard 171 00:08:02,520 --> 00:08:04,800 Speaker 1: and a few others. I am curious as to whether 172 00:08:04,840 --> 00:08:07,240 Speaker 1: you think the current uptick that we've seen in deal 173 00:08:07,280 --> 00:08:10,840 Speaker 1: making is actually going to continue and even potentially expand. 174 00:08:12,720 --> 00:08:15,440 Speaker 4: I think it will continue, and I think it will expand. 175 00:08:15,720 --> 00:08:18,160 Speaker 4: As we've had a chance to talk to the management 176 00:08:18,200 --> 00:08:21,000 Speaker 4: teams at both Carlisle and Wizard, do you feel like 177 00:08:21,000 --> 00:08:25,680 Speaker 4: the momentum is building. This regulatory environment is so much 178 00:08:25,720 --> 00:08:29,360 Speaker 4: more friendly or for acquisitions and mergers. I was talking 179 00:08:29,400 --> 00:08:34,120 Speaker 4: to a great a leader yesterday, a big brokerage firm, 180 00:08:34,559 --> 00:08:37,439 Speaker 4: and they were just saying how this is gonna be 181 00:08:37,480 --> 00:08:39,920 Speaker 4: a great time for more and more deals to happen. 182 00:08:40,800 --> 00:08:44,360 Speaker 4: I just can't overemphasize that. When you see the opportunities 183 00:08:44,360 --> 00:08:47,520 Speaker 4: both for companies to make strategic acquisitions that it's not 184 00:08:47,520 --> 00:08:50,320 Speaker 4: going to be questioned by the Justice Department or the 185 00:08:50,400 --> 00:08:53,520 Speaker 4: SEC or the other regulators are out there, the FTC 186 00:08:53,720 --> 00:08:56,400 Speaker 4: and the rest. I think you're gonna see one deal 187 00:08:56,520 --> 00:08:57,120 Speaker 4: after another. 188 00:08:58,920 --> 00:09:02,720 Speaker 1: John Rodgers, the founder and chairman of Aerial Investments, wide 189 00:09:02,800 --> 00:09:05,920 Speaker 1: ranging conversation about his investments in the small and mid 190 00:09:05,960 --> 00:09:08,960 Speaker 1: cap space, the state of the economy, the state of Chicago, 191 00:09:09,040 --> 00:09:12,319 Speaker 1: and the state of those trade tariffs.