1 00:00:05,800 --> 00:00:08,720 Speaker 1: Welcome to the Bloomberg p m L Podcast. I'm Pim Fox. 2 00:00:08,760 --> 00:00:11,520 Speaker 1: Along with my co host Lisa Abramowitz. Each day we 3 00:00:11,640 --> 00:00:15,120 Speaker 1: bring you the most important, noteworthy, and useful interviews for 4 00:00:15,200 --> 00:00:17,840 Speaker 1: you and your money, whether you're at the grocery store 5 00:00:17,960 --> 00:00:20,720 Speaker 1: or the trading floor. Find the Bloomberg p m L 6 00:00:20,840 --> 00:00:32,720 Speaker 1: Podcast on Apple Podcasts, SoundCloud, and Bloomberg dot com. The 7 00:00:32,880 --> 00:00:37,200 Speaker 1: topic now is investing in the cannabis industry. Adam Bierman 8 00:00:37,280 --> 00:00:40,320 Speaker 1: is the co founder and the chief executive of Medmen, 9 00:00:40,479 --> 00:00:43,519 Speaker 1: and he joins us from Los Angeles. Adam, thanks very 10 00:00:43,600 --> 00:00:46,760 Speaker 1: much for being with us. Tell people about med Men 11 00:00:47,080 --> 00:00:52,800 Speaker 1: and about your latest and largest acquisition. Hey, Pim, good morning. 12 00:00:53,200 --> 00:00:57,320 Speaker 1: Always going to talk to you. Um. Yeah, So med 13 00:00:57,360 --> 00:01:00,400 Speaker 1: Men is a is a cannabis company here based out 14 00:01:00,400 --> 00:01:05,600 Speaker 1: of Los Angeles. Um. We are a retailer first and foremost. UM. 15 00:01:05,720 --> 00:01:07,880 Speaker 1: But we also have factories in every market that we 16 00:01:07,920 --> 00:01:11,000 Speaker 1: operate in, so we completely control the supply chain. UM. 17 00:01:11,080 --> 00:01:13,640 Speaker 1: But you know, focus is really California and has been 18 00:01:13,680 --> 00:01:16,080 Speaker 1: for a while. I think you're referencing the farmer Can 19 00:01:16,160 --> 00:01:19,360 Speaker 1: transaction that took place a few weeks back. At that time, 20 00:01:19,360 --> 00:01:22,679 Speaker 1: the largest transaction in the history of US cannabis about 21 00:01:22,720 --> 00:01:25,800 Speaker 1: seven million dollars UM. But what farmer Can did was 22 00:01:25,840 --> 00:01:28,839 Speaker 1: it really allowed us to leap frog this next phase 23 00:01:28,880 --> 00:01:31,559 Speaker 1: of our growth UM and enter into this next set 24 00:01:31,560 --> 00:01:34,120 Speaker 1: of markets that we were already targeting. Farmer cansa midway 25 00:01:34,319 --> 00:01:38,560 Speaker 1: Midwest based cannabis company that had operations in six markets, 26 00:01:38,800 --> 00:01:41,080 Speaker 1: all Midwest to East coast. So it was a great 27 00:01:41,080 --> 00:01:44,760 Speaker 1: compliment to our footprint and UH we took action and 28 00:01:44,840 --> 00:01:48,280 Speaker 1: brought him under our umbrella and we're now stronger for it. Now. 29 00:01:48,480 --> 00:01:50,600 Speaker 1: For people that may not be familiar with how this 30 00:01:50,720 --> 00:01:53,680 Speaker 1: industry works and it is a new business, can you 31 00:01:53,760 --> 00:01:59,440 Speaker 1: explain the role that licenses play, how they differ in cost, 32 00:01:59,720 --> 00:02:04,360 Speaker 1: and how those licenses then have to be translated into 33 00:02:04,440 --> 00:02:08,520 Speaker 1: actual physical establishments. But there are a lot of processes 34 00:02:08,560 --> 00:02:14,320 Speaker 1: in the in the in the how this comes together. Sure, UM, 35 00:02:14,480 --> 00:02:16,080 Speaker 1: I could do an hour on it, but I'll do 36 00:02:16,120 --> 00:02:20,400 Speaker 1: it in their seconds. So basically, basically there's no interstate commerce. 37 00:02:20,440 --> 00:02:23,200 Speaker 1: First and foremost, so every state has its own program 38 00:02:23,240 --> 00:02:26,359 Speaker 1: and that program is unique to that state UM and 39 00:02:26,400 --> 00:02:30,000 Speaker 1: all of the state's been written into their program. UM. 40 00:02:30,000 --> 00:02:32,359 Speaker 1: It is explicit that you must have a license to 41 00:02:32,400 --> 00:02:35,560 Speaker 1: grow marijuana in that state in order to manufacture products 42 00:02:35,560 --> 00:02:38,240 Speaker 1: distributed in retail at all within the state. So there 43 00:02:38,280 --> 00:02:40,560 Speaker 1: are nuances to each of these programs, but they're all 44 00:02:40,919 --> 00:02:43,639 Speaker 1: pretty similar. Um. And so you must have one of 45 00:02:43,680 --> 00:02:46,000 Speaker 1: these licenses. Uh. You know, at the end of the day, 46 00:02:46,040 --> 00:02:49,880 Speaker 1: this industry is a nimbie industry. UM. And I think 47 00:02:49,919 --> 00:02:52,480 Speaker 1: what's really interesting is you have an industry that has 48 00:02:52,520 --> 00:02:56,640 Speaker 1: such an overwhelming support by the public. However of the 49 00:02:56,639 --> 00:02:59,520 Speaker 1: public believes medical marijuana should be legal now where you know, 50 00:02:59,639 --> 00:03:02,799 Speaker 1: sixty plus percent believe recreational marijuana should be legal. We're 51 00:03:02,800 --> 00:03:04,600 Speaker 1: in a Congress that just got a lot better for 52 00:03:04,680 --> 00:03:08,480 Speaker 1: marijuana a week ago. Yet with all the support there 53 00:03:08,560 --> 00:03:11,760 Speaker 1: is to legalize marijuana and prohibition, it's still a nimbia industry. 54 00:03:11,800 --> 00:03:13,959 Speaker 1: So you know, this is not in my backyard, which 55 00:03:14,000 --> 00:03:16,160 Speaker 1: you know, we're okay with. We embrace that's what the public. 56 00:03:16,200 --> 00:03:17,960 Speaker 1: I think that's what the public wants now and we'll 57 00:03:18,000 --> 00:03:20,760 Speaker 1: want for the investable future. So you have a really 58 00:03:20,800 --> 00:03:24,799 Speaker 1: limited nature of these licenses. And again each state different, um. 59 00:03:24,840 --> 00:03:27,000 Speaker 1: But I'm here in Los Angeles today and for example, 60 00:03:27,040 --> 00:03:29,520 Speaker 1: in all of l A County, twelve million people plus 61 00:03:29,919 --> 00:03:32,480 Speaker 1: a lot of tourists. Um, there are less than two 62 00:03:32,600 --> 00:03:38,200 Speaker 1: hundred retail licenses, so you know, limited licenses, really arduous 63 00:03:38,200 --> 00:03:42,120 Speaker 1: owning restrictions around those licenses. Um. But you know enough 64 00:03:42,200 --> 00:03:43,960 Speaker 1: so that there's critical mass to be able to serve 65 00:03:44,000 --> 00:03:47,400 Speaker 1: the public and make marijuana accessible. Okay, got it? And 66 00:03:47,560 --> 00:03:50,680 Speaker 1: wondering if what you could describe you've learned from the 67 00:03:50,760 --> 00:03:55,040 Speaker 1: experience in Canada where the country has made it legal 68 00:03:55,520 --> 00:03:58,880 Speaker 1: for recreational use, has that informed or changed any of 69 00:03:58,920 --> 00:04:03,440 Speaker 1: your thoughts? It's progress, right, I mean we've been doing 70 00:04:03,440 --> 00:04:05,560 Speaker 1: this for almost ten years, and and these check in, 71 00:04:05,600 --> 00:04:08,280 Speaker 1: these moments to check in on the progress that not 72 00:04:08,320 --> 00:04:10,560 Speaker 1: only society and the public is making in regards to 73 00:04:10,600 --> 00:04:13,280 Speaker 1: their viewpoint, but the commercial aspects of this industry and 74 00:04:13,280 --> 00:04:16,960 Speaker 1: then the political realities. UM, this is a big check in, right. 75 00:04:17,000 --> 00:04:19,720 Speaker 1: You have the first you know, nation of its size 76 00:04:19,800 --> 00:04:23,840 Speaker 1: to legalize marijuana for recreational purposes a couple of weeks ago. 77 00:04:24,080 --> 00:04:25,720 Speaker 1: And you know what we learned. We learned that the 78 00:04:26,040 --> 00:04:28,200 Speaker 1: cities didn't burn down, right, And that's what we keep 79 00:04:28,279 --> 00:04:32,400 Speaker 1: seeing as progress is made around the world. But you know, 80 00:04:32,520 --> 00:04:34,839 Speaker 1: things are things are better, They're not worse, They get 81 00:04:34,920 --> 00:04:38,040 Speaker 1: better progressively better. Um. As these laws change. You know, 82 00:04:38,240 --> 00:04:41,960 Speaker 1: the probition against marijuana just doesn't work. It's a failed effort. 83 00:04:42,279 --> 00:04:45,040 Speaker 1: Um and legalized marijuana and regulating and taxing it is 84 00:04:45,080 --> 00:04:47,440 Speaker 1: the answer. And so what I really like about what 85 00:04:47,480 --> 00:04:50,400 Speaker 1: we've seen in Canada, because it's been so successful without 86 00:04:50,440 --> 00:04:53,440 Speaker 1: any hiccups, really is I really feel like it is 87 00:04:53,480 --> 00:04:55,880 Speaker 1: the big finger wagging down here to us in the 88 00:04:55,960 --> 00:04:58,839 Speaker 1: US saying, you know, you claim to be leaders, you 89 00:04:58,880 --> 00:05:02,159 Speaker 1: know in business and industry. Um, you know, your stock market, 90 00:05:02,240 --> 00:05:05,600 Speaker 1: your exchanges are you know, leaders in in what they do, 91 00:05:05,640 --> 00:05:07,840 Speaker 1: and yet you can't list a US weed company on 92 00:05:07,880 --> 00:05:09,600 Speaker 1: the New York Stock has changed or NAZDAC yet and 93 00:05:09,680 --> 00:05:13,040 Speaker 1: yet it's still federally illegal while you know your neighbors 94 00:05:13,080 --> 00:05:15,719 Speaker 1: Tier North here run with this thing. So um, it 95 00:05:15,760 --> 00:05:18,280 Speaker 1: puts pressure on the US and and that's something that 96 00:05:18,320 --> 00:05:22,880 Speaker 1: we're grateful for. What would be the most important change 97 00:05:23,680 --> 00:05:26,560 Speaker 1: that would help the industry. Would it relate to banking 98 00:05:26,640 --> 00:05:31,400 Speaker 1: rules and regulations? Not really? I mean, you know, we 99 00:05:31,400 --> 00:05:34,360 Speaker 1: were fully banked, as are all of our counterparts and 100 00:05:34,720 --> 00:05:37,599 Speaker 1: peers in this industry. From a depository perspective, you know, 101 00:05:37,640 --> 00:05:40,680 Speaker 1: we don't have access to traditional banking services, but it 102 00:05:40,680 --> 00:05:43,160 Speaker 1: all fits in the same bucket. It's banking services, it's 103 00:05:43,200 --> 00:05:46,919 Speaker 1: merchant processing, it's proper tax treatment, UM, it's everything that 104 00:05:46,960 --> 00:05:50,640 Speaker 1: comes along with, you know, being a lawful business, paying 105 00:05:50,640 --> 00:05:54,599 Speaker 1: your taxes and receiving the protections UM, and the opportunities 106 00:05:54,600 --> 00:05:57,960 Speaker 1: that paying your taxes and being upstanding provide you. And 107 00:05:57,960 --> 00:06:00,960 Speaker 1: and so that that next big moment that you're asking 108 00:06:01,000 --> 00:06:03,160 Speaker 1: about really has to do with Congress, and it really 109 00:06:03,160 --> 00:06:08,640 Speaker 1: has to do with permanent protection of state sanctioned marijuana businesses. 110 00:06:08,680 --> 00:06:10,880 Speaker 1: And I firmly believe we will see that here in 111 00:06:10,920 --> 00:06:13,520 Speaker 1: our country. And f y nineteen, thanks very much for 112 00:06:13,600 --> 00:06:18,240 Speaker 1: being with us. Adam Bierman, co founder, chief executive Medmen 113 00:06:18,920 --> 00:06:22,479 Speaker 1: based in Los Angeles, giving us his view based on 114 00:06:22,600 --> 00:06:41,120 Speaker 1: his experience in the cannabis industry. Everybody talks about the 115 00:06:41,200 --> 00:06:43,800 Speaker 1: US dollar, but no one does anything about it. Well, 116 00:06:43,839 --> 00:06:46,360 Speaker 1: we're going to change that. Here in the Bloomberg Interactor 117 00:06:46,400 --> 00:06:50,080 Speaker 1: Broker's studio, I want to introduce Gary Shilling. He is 118 00:06:50,120 --> 00:06:53,760 Speaker 1: the president of a Gary Shilling and Company. He is 119 00:06:53,880 --> 00:06:58,280 Speaker 1: a Bloomberg opinion columnist. He is also the author of 120 00:06:58,320 --> 00:07:02,880 Speaker 1: the Age of de Leverage, Investment strategies for a decade 121 00:07:03,040 --> 00:07:07,279 Speaker 1: of slow growth and deflation a Gary Shilling. Thank you 122 00:07:07,360 --> 00:07:10,080 Speaker 1: very much for being with us. Let's begin with the 123 00:07:10,160 --> 00:07:14,239 Speaker 1: strength of the US dollar. Is it gaining in strength 124 00:07:14,320 --> 00:07:17,320 Speaker 1: because people love the United States or is it they 125 00:07:17,440 --> 00:07:21,960 Speaker 1: just don't want to own anything else. It's a combination, Tim, 126 00:07:22,000 --> 00:07:25,080 Speaker 1: I mean, the US is clue to the safe haven. 127 00:07:25,120 --> 00:07:27,400 Speaker 1: And you look at all the problems around the world 128 00:07:27,440 --> 00:07:32,280 Speaker 1: of protectionism, and and the US is growing faster than 129 00:07:32,320 --> 00:07:36,040 Speaker 1: other countries, and and it's it's traditional safe haven. One 130 00:07:36,040 --> 00:07:40,200 Speaker 1: of the interesting things is even if haven of problems 131 00:07:40,240 --> 00:07:43,000 Speaker 1: start in this country, and I think that's pretty clear 132 00:07:43,040 --> 00:07:46,840 Speaker 1: with Trump's attitude on the trade wars with China, the 133 00:07:46,920 --> 00:07:50,800 Speaker 1: dollar benefits. Uh. Show you you have a number of 134 00:07:51,240 --> 00:07:54,440 Speaker 1: reasons that I think the dollar is going to continue 135 00:07:54,480 --> 00:07:57,000 Speaker 1: to be strong and right there today as we speak, 136 00:07:57,000 --> 00:07:59,920 Speaker 1: as fine as I'm sure you're aware, I am aware. 137 00:08:00,120 --> 00:08:03,080 Speaker 1: And I'm aware also that you'd say that there are 138 00:08:03,280 --> 00:08:08,160 Speaker 1: six long term criteria for the dominance of the US dollar. 139 00:08:08,360 --> 00:08:12,080 Speaker 1: Go ahead, tell us quickly. Well, the first one is 140 00:08:12,160 --> 00:08:15,920 Speaker 1: that and we've we've I've started this going back to 141 00:08:16,000 --> 00:08:20,480 Speaker 1: ancient ancient times of Greek in Rome and and looked 142 00:08:20,520 --> 00:08:24,880 Speaker 1: at what what are the characteristics of the world's leading currency. UM. 143 00:08:24,920 --> 00:08:27,560 Speaker 1: The first one is rapid growth, and we grew growing 144 00:08:27,640 --> 00:08:32,200 Speaker 1: much more rapidly than other developed countries. China, yeah, faster growth, 145 00:08:32,200 --> 00:08:34,679 Speaker 1: but it's a developing country and it's slowing down. The 146 00:08:34,800 --> 00:08:39,120 Speaker 1: second one is a huge economy UM. And the US 147 00:08:39,240 --> 00:08:42,199 Speaker 1: is is still clearly the largest economy in the world, 148 00:08:42,200 --> 00:08:47,240 Speaker 1: where about bigger than China, which is in second place. Uh. 149 00:08:47,480 --> 00:08:52,400 Speaker 1: Third one is deep and broad financial markets and and 150 00:08:52,440 --> 00:08:55,160 Speaker 1: we certainly have that. Uh In the US. You look 151 00:08:55,200 --> 00:08:58,640 Speaker 1: for a stock market capitalization thirty two trillion dollars, euro 152 00:08:58,840 --> 00:09:04,000 Speaker 1: Zone eleven trillion, China about nine trillion, Japan six trillion UM, 153 00:09:04,080 --> 00:09:06,920 Speaker 1: and and our treasury market, you know, fifteen point three 154 00:09:07,000 --> 00:09:11,240 Speaker 1: trillion compares to six point seven point six trillion in Japan, 155 00:09:11,360 --> 00:09:14,320 Speaker 1: six point one and in China and one point six 156 00:09:14,440 --> 00:09:17,800 Speaker 1: in Germany. So that's that's the third thing. The fourth 157 00:09:17,800 --> 00:09:21,080 Speaker 1: one is free and open markets and economy, and we 158 00:09:21,200 --> 00:09:23,880 Speaker 1: certainly we certainly have that. If you look at the 159 00:09:23,920 --> 00:09:27,840 Speaker 1: World Bank ranking of of where it's easy to do business, 160 00:09:28,200 --> 00:09:30,680 Speaker 1: the US is is close to the top, and you 161 00:09:30,720 --> 00:09:35,439 Speaker 1: look at something like China, course it's it's it's very difficult. UM. 162 00:09:35,559 --> 00:09:39,200 Speaker 1: Fifth reason is lack of substitutes. And you know, the 163 00:09:39,240 --> 00:09:43,680 Speaker 1: dollars of all the world's transactions in in trade and 164 00:09:43,960 --> 00:09:47,480 Speaker 1: capital folls of the dollars involved in seven percent of those, 165 00:09:48,040 --> 00:09:51,720 Speaker 1: there really isn't any any option UM and and UH 166 00:09:52,200 --> 00:09:56,599 Speaker 1: in terms of substitution. Most of the over fifty of 167 00:09:56,640 --> 00:10:01,480 Speaker 1: the world's currency reserves in dollars six thing credibility. And 168 00:10:01,520 --> 00:10:05,360 Speaker 1: I think we're seeing that clearly. And and I've added 169 00:10:05,760 --> 00:10:07,439 Speaker 1: this is a list I've had for some time. I've 170 00:10:07,440 --> 00:10:11,120 Speaker 1: had a seventh one, which is that Tump is really 171 00:10:11,160 --> 00:10:16,559 Speaker 1: asserting the US UH power economic, military, financial power on 172 00:10:16,600 --> 00:10:20,240 Speaker 1: the world stage. We've had that really since World War Two, 173 00:10:20,240 --> 00:10:22,560 Speaker 1: but it has not been exercise extent that he does. 174 00:10:23,040 --> 00:10:25,600 Speaker 1: And I think that is gaining a lot of credibility 175 00:10:25,679 --> 00:10:28,199 Speaker 1: for the U S and the dollar UH foreigners, where 176 00:10:28,200 --> 00:10:30,680 Speaker 1: they like it or not. He's really saying, hey, we 177 00:10:30,760 --> 00:10:32,679 Speaker 1: got this, we got the upper hand, We're going to 178 00:10:32,720 --> 00:10:36,800 Speaker 1: exercise it. Let's talk about the general economy. Is there 179 00:10:36,840 --> 00:10:41,120 Speaker 1: a looming recession? Yeah, I think there probably is. Now, 180 00:10:41,360 --> 00:10:46,080 Speaker 1: you know, to say that it's it's gonna unroll untold 181 00:10:46,080 --> 00:10:49,200 Speaker 1: in the next month or two, that's always a dangerous 182 00:10:49,240 --> 00:10:52,800 Speaker 1: pet one one very wise economist one said you should 183 00:10:52,840 --> 00:10:55,200 Speaker 1: forecast what will happen or when it will happen, but 184 00:10:55,240 --> 00:10:57,960 Speaker 1: not both. But there are a lot of signs and 185 00:10:58,000 --> 00:11:01,479 Speaker 1: I've written that up in our latest of the UH newsletter, 186 00:11:01,559 --> 00:11:05,520 Speaker 1: Insight UM. Certainly you have it that turned down in stocks, 187 00:11:05,520 --> 00:11:09,520 Speaker 1: and that's a leading indicator. Housing housing very interest rates sensitive, 188 00:11:09,840 --> 00:11:12,880 Speaker 1: and it is UH. It is responding to the Feds 189 00:11:13,000 --> 00:11:15,600 Speaker 1: raising race. And the said raising race, you know, don't 190 00:11:15,600 --> 00:11:18,800 Speaker 1: fight the Fed. UH. When the Fed starts to graze 191 00:11:18,880 --> 00:11:21,559 Speaker 1: rates sooner or later. They killed the economy twelve or 192 00:11:21,600 --> 00:11:24,440 Speaker 1: thirteen times the postwar period. They didn't get a soft 193 00:11:24,559 --> 00:11:27,160 Speaker 1: landing only once in the mid nineties. And now they're 194 00:11:27,160 --> 00:11:29,800 Speaker 1: not only raising interest rates, but they're selling off the portfolio. 195 00:11:29,920 --> 00:11:32,719 Speaker 1: They've had a century of experience with interest rates and 196 00:11:32,760 --> 00:11:35,960 Speaker 1: they still can't affect soft landing, so showing off the 197 00:11:36,000 --> 00:11:38,640 Speaker 1: portfolio on on top of that, and then you look 198 00:11:38,679 --> 00:11:44,040 Speaker 1: at the exuberance we've seen in consumers and the expansion 199 00:11:44,120 --> 00:11:48,400 Speaker 1: of things like leverage loans and you know, people zealous 200 00:11:48,440 --> 00:11:53,120 Speaker 1: for you rushing into UH, into hedge funds of hedge funds, 201 00:11:53,160 --> 00:11:55,360 Speaker 1: private equity and so on. All of these things are 202 00:11:55,679 --> 00:12:00,240 Speaker 1: are very similar similarly occur at the top. So I 203 00:12:00,240 --> 00:12:02,400 Speaker 1: think there's a lot of reasons to believe we're at 204 00:12:02,400 --> 00:12:04,080 Speaker 1: the top. Now, that doesn't mean it's going to turn 205 00:12:04,160 --> 00:12:07,280 Speaker 1: down immediately, but um, I think that the odds of 206 00:12:07,400 --> 00:12:10,839 Speaker 1: a recession are probably over fifty starting in the next 207 00:12:10,920 --> 00:12:13,520 Speaker 1: year or so. Gary, If you happen to be an 208 00:12:13,600 --> 00:12:17,280 Speaker 1: investor who is expecting higher interest rates, are you going 209 00:12:17,360 --> 00:12:21,640 Speaker 1: to be disappointed? Uh? Yeah, I think you probably are 210 00:12:21,800 --> 00:12:24,240 Speaker 1: because there are two There are two things working there 211 00:12:24,679 --> 00:12:27,200 Speaker 1: and full disclosures him As you know, I in nine 212 00:12:28,000 --> 00:12:31,120 Speaker 1: when they yield and the thirty year bond was sixteen 213 00:12:31,160 --> 00:12:34,040 Speaker 1: point seven percent, I said, we're entering the run bond 214 00:12:34,120 --> 00:12:38,199 Speaker 1: rally of lifetime. And since then wrong treasuries have outperformed 215 00:12:38,240 --> 00:12:40,679 Speaker 1: the S and P since the early eighties by six times. 216 00:12:41,160 --> 00:12:43,840 Speaker 1: So i'm i'm, I'm, I've got a bias there, clearly. 217 00:12:43,880 --> 00:12:46,840 Speaker 1: But the point is you've got two forces there. The 218 00:12:46,880 --> 00:12:49,720 Speaker 1: fetters tightening and there is a spillover. I mean, for 219 00:12:49,760 --> 00:12:52,400 Speaker 1: every hundred basis point increasing the head funds on average 220 00:12:52,400 --> 00:12:54,920 Speaker 1: in the post war period, you get a forty four 221 00:12:55,280 --> 00:12:58,800 Speaker 1: uh basis points fill over the ten years treasuries, but 222 00:12:58,960 --> 00:13:02,160 Speaker 1: only at twenty four still over to UH to a 223 00:13:02,240 --> 00:13:04,880 Speaker 1: long term treasury thirty year. I know there's a further 224 00:13:04,920 --> 00:13:07,240 Speaker 1: way you get from the Fed. The less the Fed 225 00:13:07,240 --> 00:13:09,199 Speaker 1: matters and the more other things matter. In the long run, 226 00:13:09,240 --> 00:13:13,280 Speaker 1: it's it's inflation. There's a sixty percent correlation between UH, 227 00:13:13,440 --> 00:13:15,800 Speaker 1: the CPI you're over here in the post ar period 228 00:13:15,800 --> 00:13:18,960 Speaker 1: and and and treasury bonds. UH. So you've got the 229 00:13:19,000 --> 00:13:21,120 Speaker 1: Fed fighting, but there's some spill over. But on the 230 00:13:21,120 --> 00:13:24,560 Speaker 1: other side, you've got a lot of deflationary forces here. 231 00:13:24,640 --> 00:13:28,880 Speaker 1: You look at you look at protectionism, globalization moving all 232 00:13:28,920 --> 00:13:32,680 Speaker 1: these high paid jobs to China and other developing countries. 233 00:13:32,720 --> 00:13:35,720 Speaker 1: You look at the uberization of the world, the on demand, 234 00:13:35,760 --> 00:13:39,880 Speaker 1: the gig economy, if you will. UH unions they're very 235 00:13:39,960 --> 00:13:44,000 Speaker 1: high paid and they virtually disappeared, particularly the private sarcy. 236 00:13:44,000 --> 00:13:46,400 Speaker 1: You go a lot of forces there that are telling 237 00:13:46,400 --> 00:13:50,440 Speaker 1: you there's deflationary climate, and of course we get a recession. 238 00:13:50,440 --> 00:13:53,640 Speaker 1: Even more so so, UM, I think that I think 239 00:13:53,679 --> 00:13:56,160 Speaker 1: we could be getting close to the peak and in 240 00:13:56,320 --> 00:13:58,520 Speaker 1: interest rates, particularly on the long end, even though the 241 00:13:58,559 --> 00:14:01,520 Speaker 1: Fed is still raising. On the show, Gary Shilling is 242 00:14:01,559 --> 00:14:04,920 Speaker 1: a Bloomberg View columnist. He's the president of a Gary 243 00:14:04,960 --> 00:14:08,239 Speaker 1: Shilling and Company. It is a consultancy based in Springfield, 244 00:14:08,280 --> 00:14:10,880 Speaker 1: New Jersey. He is the author of the Age of 245 00:14:10,960 --> 00:14:16,280 Speaker 1: Deleveraging Investment Strategies for a decade of slow growth and deflation, 246 00:14:16,640 --> 00:14:19,520 Speaker 1: and he is also the author of a Gary Shillings 247 00:14:19,680 --> 00:14:37,720 Speaker 1: Inside Economic Research and Investment Strategy. Well, we turn our 248 00:14:37,760 --> 00:14:40,800 Speaker 1: attention now to the world of crude oil here at 249 00:14:40,800 --> 00:14:44,120 Speaker 1: the Bloomberg Interactive Brokers Studios and joining us as John 250 00:14:44,240 --> 00:14:47,960 Speaker 1: killed Off. He is the founding partner of Again Capital, 251 00:14:48,160 --> 00:14:52,040 Speaker 1: John Always a Pleasure. Brent crude higher by about one 252 00:14:52,080 --> 00:14:54,800 Speaker 1: and a half percent at seventy one dollars a barrel, 253 00:14:55,440 --> 00:14:58,080 Speaker 1: West Texas Intermediate on the NIMEX up one and a 254 00:14:58,160 --> 00:15:02,520 Speaker 1: half percent at sixty one dollars a barrel. Have we 255 00:15:02,680 --> 00:15:05,760 Speaker 1: hit the lows for this year when it comes to 256 00:15:05,920 --> 00:15:11,120 Speaker 1: oil prices? I think potentially him and good morning to you. 257 00:15:11,320 --> 00:15:14,320 Speaker 1: Great to be on uh. Friday's low is fifty nine 258 00:15:15,080 --> 00:15:17,840 Speaker 1: six cents for w t I and it's sort of 259 00:15:17,880 --> 00:15:20,000 Speaker 1: sticking out on the on the charts that we look 260 00:15:20,040 --> 00:15:23,200 Speaker 1: at as a bit of a sore thumb low. So 261 00:15:23,600 --> 00:15:26,960 Speaker 1: we're getting some recovery here, you know, partly because this 262 00:15:27,200 --> 00:15:31,160 Speaker 1: um nearly seventeen dollar sell off over the course of 263 00:15:31,200 --> 00:15:35,240 Speaker 1: a month. You know, got the expected reaction you would 264 00:15:35,600 --> 00:15:38,920 Speaker 1: have thought would come from Saudi Arabia and and the 265 00:15:38,960 --> 00:15:42,640 Speaker 1: rest of OPEC and Russia to a lesser degree. Well 266 00:15:42,760 --> 00:15:46,320 Speaker 1: that reaction is what to cut production by how many 267 00:15:46,360 --> 00:15:51,080 Speaker 1: barrels of oil a day? Well, it's it's a little sketchy, 268 00:15:51,120 --> 00:15:53,840 Speaker 1: which is why the market isn't necessarily rounding war on 269 00:15:53,880 --> 00:15:57,280 Speaker 1: the news. The Saudis came out pushing for a million 270 00:15:57,320 --> 00:16:01,400 Speaker 1: barrel per day cut. Uh. The Russian oil minister not 271 00:16:01,480 --> 00:16:03,920 Speaker 1: so enthusiastic about it, and it doesn't seem like the 272 00:16:03,960 --> 00:16:07,000 Speaker 1: rest of Opec is either, although I'll point out to 273 00:16:07,000 --> 00:16:09,400 Speaker 1: you that based upon some of the data that we 274 00:16:09,440 --> 00:16:11,720 Speaker 1: look at that the Satties are already in the process 275 00:16:11,720 --> 00:16:15,800 Speaker 1: of cutting output by about by thousand barrels for December. 276 00:16:16,400 --> 00:16:20,480 Speaker 1: So they are reacting to this now. And it's also 277 00:16:20,560 --> 00:16:23,080 Speaker 1: not unexpected given that the US elections in their rear 278 00:16:23,160 --> 00:16:26,000 Speaker 1: view mirror, they probably feel more comfortable being able to 279 00:16:26,200 --> 00:16:28,440 Speaker 1: reign in production, get prices up a bit, and not 280 00:16:28,520 --> 00:16:32,640 Speaker 1: necessarily risk the wrath of their ally President Trump. Does 281 00:16:32,680 --> 00:16:35,840 Speaker 1: it matter that at the same time that the Saudis 282 00:16:35,880 --> 00:16:38,760 Speaker 1: are ratcheting back to production by half a million barrels 283 00:16:38,760 --> 00:16:42,920 Speaker 1: a day, that Iran is now under greater sanction and 284 00:16:43,000 --> 00:16:45,240 Speaker 1: making it more difficult for it to sell its oil 285 00:16:45,280 --> 00:16:49,800 Speaker 1: abroad were interesting tim Part of the crush here in prices, 286 00:16:50,480 --> 00:16:54,520 Speaker 1: um was the fact that the administration granted eight waivers 287 00:16:54,560 --> 00:16:58,200 Speaker 1: to really Iran's the bulk of Iran's customers to continue 288 00:16:58,200 --> 00:17:00,840 Speaker 1: to buy oil. There was a sense when November rolled 289 00:17:00,880 --> 00:17:03,280 Speaker 1: around and the stantons were supposed to take effect that 290 00:17:03,320 --> 00:17:06,399 Speaker 1: there would be a big impact on Iranian exports and 291 00:17:06,440 --> 00:17:09,640 Speaker 1: supplies to the market, that a lot would be coming off. Um, 292 00:17:09,680 --> 00:17:12,000 Speaker 1: there's still some coming off, don't get me wrong, but 293 00:17:12,720 --> 00:17:15,040 Speaker 1: nowhere near the sort of feared levels that were in 294 00:17:15,160 --> 00:17:17,840 Speaker 1: that got into this market and push prices up towards 295 00:17:17,920 --> 00:17:19,919 Speaker 1: you know, eighty dollars a barrel for w t I 296 00:17:20,320 --> 00:17:24,679 Speaker 1: back in October. It was it was the administration really 297 00:17:25,720 --> 00:17:28,679 Speaker 1: uh cut the legs out from under Saudi Arabian Russia 298 00:17:28,720 --> 00:17:33,480 Speaker 1: who rushed increased production and exports to the market ahead 299 00:17:33,520 --> 00:17:36,760 Speaker 1: of the sanctions. So, um, I guess the expressions, you know, 300 00:17:36,800 --> 00:17:39,040 Speaker 1: did they get played or not? It may be kind of, 301 00:17:39,160 --> 00:17:42,320 Speaker 1: but the market certainly got played as well. In terms 302 00:17:42,359 --> 00:17:45,440 Speaker 1: of this, this turnaround in policy at least for now 303 00:17:45,840 --> 00:17:48,800 Speaker 1: by the administration on Iran. If this is the case, 304 00:17:48,920 --> 00:17:55,520 Speaker 1: does that benefit US producers? The U S producers are 305 00:17:55,560 --> 00:17:58,280 Speaker 1: a real thorn right now in the Saudia's and Opec 306 00:17:58,320 --> 00:18:01,800 Speaker 1: and Russia's side, where we're exporting more oyal than ever before. 307 00:18:02,080 --> 00:18:05,080 Speaker 1: We're averaging about two point five liim barrel per day, 308 00:18:05,080 --> 00:18:07,400 Speaker 1: clipped him from zero just a couple of years ago. 309 00:18:07,440 --> 00:18:09,520 Speaker 1: Just to put it in perspective, Um, it's only going 310 00:18:09,560 --> 00:18:12,080 Speaker 1: to go up. There's there's this massive activity along the 311 00:18:12,119 --> 00:18:15,240 Speaker 1: Gulf coast to outlet more and more US crude oil 312 00:18:15,840 --> 00:18:19,800 Speaker 1: to the market. So um. The STATI response in terms 313 00:18:19,840 --> 00:18:22,159 Speaker 1: of cutting back here, I think is justified if they 314 00:18:22,160 --> 00:18:26,080 Speaker 1: want to get prices stabilized and back higher. But they 315 00:18:26,160 --> 00:18:29,040 Speaker 1: might have to be shouldering a lot more of the 316 00:18:29,080 --> 00:18:31,480 Speaker 1: cutback than they might have realized as we get into 317 00:18:32,280 --> 00:18:34,879 Speaker 1: this is a very interesting setup now that the U 318 00:18:35,000 --> 00:18:37,920 Speaker 1: S could actually become one of the dominant global suppliers 319 00:18:37,960 --> 00:18:41,120 Speaker 1: here as we get into next year. Take that forward 320 00:18:41,480 --> 00:18:45,080 Speaker 1: and explain what that would mean for the input costs 321 00:18:45,400 --> 00:18:49,480 Speaker 1: for the chemical industry, the plastics business, or anything that 322 00:18:49,720 --> 00:18:53,560 Speaker 1: uses fossil fuel. Well, it's going to keep it low 323 00:18:53,720 --> 00:18:56,399 Speaker 1: for sure, I think on a global basis, so it 324 00:18:56,480 --> 00:18:59,960 Speaker 1: should continue to be good times for that very sick 325 00:19:00,000 --> 00:19:03,600 Speaker 1: local industry. The rub is going to be whether or 326 00:19:03,600 --> 00:19:06,240 Speaker 1: not the the advantage that U. S A. Finders have 327 00:19:06,359 --> 00:19:09,920 Speaker 1: had will persist. I mean, right w T I Texas 328 00:19:09,920 --> 00:19:13,359 Speaker 1: crew continues to be about ten dollars under the international 329 00:19:13,400 --> 00:19:17,040 Speaker 1: markers like Brent, which is seventy one today. Um to 330 00:19:17,080 --> 00:19:20,360 Speaker 1: the extent that US supplies tightened here because of all 331 00:19:20,400 --> 00:19:23,880 Speaker 1: this export activity like we're seeing with natural gas, uh, 332 00:19:24,000 --> 00:19:27,000 Speaker 1: the the U. S R. Finders could actually find themselves 333 00:19:27,040 --> 00:19:30,440 Speaker 1: in a disadvantage because of what the exploration and production 334 00:19:30,480 --> 00:19:32,719 Speaker 1: companies are doing in terms of not selling to them 335 00:19:32,760 --> 00:19:34,960 Speaker 1: at a discount, but selling at a higher price to 336 00:19:35,000 --> 00:19:38,040 Speaker 1: the world market. Last question to you give you about 337 00:19:38,080 --> 00:19:42,160 Speaker 1: twenty five seconds natural gas at three dollars and seventy 338 00:19:42,240 --> 00:19:44,960 Speaker 1: eight cents per million b tou do we see four 339 00:19:45,000 --> 00:19:50,280 Speaker 1: dollar permannium BTU not gas? Then the natural gas market 340 00:19:50,320 --> 00:19:54,320 Speaker 1: could get really ugly here for consumers. We're starting off 341 00:19:54,320 --> 00:19:58,119 Speaker 1: this winter heating season with supplies about fiftent below last 342 00:19:58,160 --> 00:20:00,720 Speaker 1: year and the five year average. That sets up this 343 00:20:00,840 --> 00:20:03,840 Speaker 1: market to be really tightly supplied. You get a couple 344 00:20:03,880 --> 00:20:06,480 Speaker 1: of more of these early season call snaps, the price 345 00:20:06,520 --> 00:20:10,560 Speaker 1: could double at this point as you get into January. Uh, 346 00:20:10,720 --> 00:20:13,800 Speaker 1: in December and January, we're gonna keep watching that, that's 347 00:20:13,840 --> 00:20:17,400 Speaker 1: for sure. John Killed, a founding partner of Again Capital, 348 00:20:17,800 --> 00:20:35,240 Speaker 1: telling us about oil and natural gas. Our topic now 349 00:20:35,440 --> 00:20:39,959 Speaker 1: is the hotel and hospitality industry. My guest is Jay Stein. 350 00:20:40,119 --> 00:20:43,840 Speaker 1: He is the chief executive of Dream Hotel Group and 351 00:20:43,880 --> 00:20:47,040 Speaker 1: he joins us here in studio. Jay, thanks very much 352 00:20:47,080 --> 00:20:49,800 Speaker 1: for being here. Tell people a little bit about Dream 353 00:20:49,880 --> 00:20:53,720 Speaker 1: Hotel Group and how it has transformed itself from being 354 00:20:53,760 --> 00:20:58,120 Speaker 1: an operation that owned and managed the properties to one 355 00:20:58,160 --> 00:21:01,679 Speaker 1: that is focused. Well, you held a story that's exactly it. 356 00:21:02,000 --> 00:21:04,000 Speaker 1: So uh and and thanks for having me. Nice to 357 00:21:04,000 --> 00:21:07,560 Speaker 1: be here. So we have transformed the company. We were 358 00:21:07,680 --> 00:21:11,320 Speaker 1: more of a ownership and we built hotels and and 359 00:21:11,480 --> 00:21:15,640 Speaker 1: manage those and they were cool, hip lifestyle hotels, generally 360 00:21:15,680 --> 00:21:19,080 Speaker 1: one off properties. And then uh, we took some of 361 00:21:19,119 --> 00:21:21,840 Speaker 1: those hotels that we're doing very well and the public 362 00:21:21,880 --> 00:21:25,080 Speaker 1: seemed to enjoy them and converted them into brands. Uh. 363 00:21:25,119 --> 00:21:28,960 Speaker 1: This started in earnest about five years ago. And UM, 364 00:21:29,000 --> 00:21:33,040 Speaker 1: it's allowing us to grow much quicker because now we're 365 00:21:33,119 --> 00:21:36,520 Speaker 1: using other developers as opposed to just our own money UM. 366 00:21:36,560 --> 00:21:39,000 Speaker 1: And these are expensive assets, are about a hundred fifty 367 00:21:39,000 --> 00:21:42,760 Speaker 1: million dollars plus a piece to build UM and they 368 00:21:42,800 --> 00:21:45,959 Speaker 1: take three to five six seven years sometimes to develop. 369 00:21:46,000 --> 00:21:48,359 Speaker 1: So on our own it was taking a long time 370 00:21:48,400 --> 00:21:50,520 Speaker 1: to build up the number of properties. But now we're 371 00:21:50,720 --> 00:21:53,960 Speaker 1: signing a deal about one every month, every month and 372 00:21:53,960 --> 00:21:56,520 Speaker 1: a half. So so and you just why wouldn't say, 373 00:21:56,560 --> 00:21:59,800 Speaker 1: just but you have opened your first hotel in Los 374 00:21:59,840 --> 00:22:03,520 Speaker 1: ange Chelists we did about a year and four months ago. 375 00:22:03,560 --> 00:22:07,280 Speaker 1: At this point, uh hundred and sixty eight room property 376 00:22:07,400 --> 00:22:11,000 Speaker 1: with a tremendous amount of food and beverage, nightlife, entertainment. 377 00:22:11,400 --> 00:22:14,800 Speaker 1: We have six different venues there and uh it's one 378 00:22:14,840 --> 00:22:18,399 Speaker 1: of the most fun hotels certainly in the Explain why 379 00:22:18,920 --> 00:22:23,840 Speaker 1: that aspect of the hospitality industry, the nightlife, the entertainment, 380 00:22:24,000 --> 00:22:27,560 Speaker 1: the restaurants. Why is that so important in an era 381 00:22:27,680 --> 00:22:30,600 Speaker 1: of air B two B. So that is what we do, 382 00:22:30,720 --> 00:22:34,480 Speaker 1: That's what we're famous for. We create environments where uh, 383 00:22:34,600 --> 00:22:38,639 Speaker 1: social activity will happen. A lot of hotels focus on 384 00:22:38,720 --> 00:22:41,639 Speaker 1: their guest rooms and as we do as well, but 385 00:22:41,800 --> 00:22:44,520 Speaker 1: we add in that element where people from the community 386 00:22:44,560 --> 00:22:47,960 Speaker 1: want to come use the hotel for nightlife, food and beverage, 387 00:22:47,960 --> 00:22:52,160 Speaker 1: health and wellness, uh and other uh social things that 388 00:22:52,160 --> 00:22:56,159 Speaker 1: that we uh programmed for the hotel. And um you know, 389 00:22:56,240 --> 00:23:01,560 Speaker 1: Airbnb doesn't have a restaurant in somebody's apartment, So what 390 00:23:01,600 --> 00:23:04,240 Speaker 1: we do is very different, and uh it's always been 391 00:23:04,560 --> 00:23:07,240 Speaker 1: something that we've been able to uh hang our hat 392 00:23:07,320 --> 00:23:10,280 Speaker 1: on and and make us unique in the industry. Is 393 00:23:10,320 --> 00:23:17,119 Speaker 1: that something that you encouraged and emphasized and accelerated because 394 00:23:17,240 --> 00:23:20,680 Speaker 1: you see what is happening with the popularity of air 395 00:23:21,160 --> 00:23:23,880 Speaker 1: b and B definitely not. We were doing this way 396 00:23:23,880 --> 00:23:30,040 Speaker 1: before Airbnb had had come to into existence, and um, 397 00:23:30,119 --> 00:23:32,159 Speaker 1: you know, I look back in the industry and so 398 00:23:32,400 --> 00:23:35,160 Speaker 1: that's what hotels were back in the forties, fifties, sixties, 399 00:23:35,200 --> 00:23:39,200 Speaker 1: great meeting places, great uh social hubs for the community, 400 00:23:39,400 --> 00:23:41,400 Speaker 1: and then we got away from that in the seventies 401 00:23:41,400 --> 00:23:43,959 Speaker 1: and eighties nineties. They were really big box hotels. They 402 00:23:44,000 --> 00:23:47,399 Speaker 1: weren't very meaningful to uh the community that that they 403 00:23:47,400 --> 00:23:53,639 Speaker 1: were in often and um so around the mid eighties nineties, 404 00:23:53,800 --> 00:23:57,280 Speaker 1: uh Ian Schraeger started changing what the landscape was like 405 00:23:57,359 --> 00:24:00,280 Speaker 1: and we caught on pretty quickly, and now we've been 406 00:24:00,280 --> 00:24:03,360 Speaker 1: doing lifestyle hotels for over twenty years. Now. You've got 407 00:24:03,359 --> 00:24:06,840 Speaker 1: a background, obviously in the hospitality industry, having worked for 408 00:24:07,080 --> 00:24:11,480 Speaker 1: Durall Hotels and Resorts as well as Hilton International, star Wood. 409 00:24:12,480 --> 00:24:16,880 Speaker 1: What is the limit of consolidation if there is one? 410 00:24:17,040 --> 00:24:19,840 Speaker 1: In the hotel industry, it seems that they're just getting 411 00:24:19,920 --> 00:24:23,320 Speaker 1: bigger and bigger, and does that hurt the quality of 412 00:24:23,320 --> 00:24:25,920 Speaker 1: the product that's being offered? You know, I don't think 413 00:24:25,960 --> 00:24:30,439 Speaker 1: it hurts the quality. I think it's difficult for individual 414 00:24:30,520 --> 00:24:33,440 Speaker 1: developers that are going to these big companies and wanting 415 00:24:33,440 --> 00:24:35,800 Speaker 1: to use one of their brands, because now you've got 416 00:24:35,840 --> 00:24:38,600 Speaker 1: so much overlap and so much of that product in 417 00:24:38,600 --> 00:24:41,800 Speaker 1: the same city. Marriott could have twenty hotels in one 418 00:24:41,840 --> 00:24:44,160 Speaker 1: city where they if they used to have five or eight, 419 00:24:44,240 --> 00:24:46,400 Speaker 1: it seemed like a lot. So I think that could 420 00:24:46,400 --> 00:24:48,800 Speaker 1: be a little difficult for an owner. Remember Marriott doesn't 421 00:24:48,800 --> 00:24:51,480 Speaker 1: own the hotels, and I'm using Marry Up, but you know, 422 00:24:51,520 --> 00:24:54,160 Speaker 1: any of the big brands um so, I think their 423 00:24:54,240 --> 00:24:58,440 Speaker 1: consolidation has been maybe a bit of a concern for us. 424 00:24:58,880 --> 00:25:02,280 Speaker 1: UM a small a company like like ours, it doesn't 425 00:25:02,280 --> 00:25:04,520 Speaker 1: really affect us. In fact, I think it helps us 426 00:25:04,600 --> 00:25:10,200 Speaker 1: because those developers that really want um a unique, one 427 00:25:10,240 --> 00:25:14,560 Speaker 1: off type, independent type property. Uh, those it's gonna be 428 00:25:14,560 --> 00:25:17,560 Speaker 1: difficult for those companies to deliver it where that's really 429 00:25:17,600 --> 00:25:19,399 Speaker 1: a forte and that's why they come to us. So 430 00:25:20,080 --> 00:25:22,880 Speaker 1: what is the what is the background of the new 431 00:25:22,960 --> 00:25:28,080 Speaker 1: brand unscripted hotels? So Unscripted the main reason we launched 432 00:25:28,119 --> 00:25:31,119 Speaker 1: it. It It gave us the opportunity to go into secondary 433 00:25:31,160 --> 00:25:34,960 Speaker 1: markets or even tertiary markets, but where there's a cool 434 00:25:35,080 --> 00:25:38,359 Speaker 1: vibe again, ability to drive some social interaction. Where are 435 00:25:38,400 --> 00:25:41,119 Speaker 1: other three brands really belonging to? Durham, North Carolina is 436 00:25:41,160 --> 00:25:43,760 Speaker 1: an example. We have one of the unscripted brands. You know, 437 00:25:43,800 --> 00:25:45,480 Speaker 1: it's an up and coming city, but I don't think 438 00:25:45,480 --> 00:25:47,639 Speaker 1: it's ever gonna become a primary market for a number 439 00:25:47,640 --> 00:25:50,359 Speaker 1: of years from now. But it's got a great history 440 00:25:50,480 --> 00:25:53,200 Speaker 1: and the tobacco industry and now much of those old 441 00:25:53,240 --> 00:25:56,520 Speaker 1: buildings have been converted to tech and uh it's a 442 00:25:56,560 --> 00:25:59,240 Speaker 1: great foodie town. So it was a perfect example of 443 00:25:59,480 --> 00:26:02,840 Speaker 1: where and scripta belonged. What kinds of properties do you 444 00:26:02,920 --> 00:26:07,040 Speaker 1: look for in individual locations. I know that you've got 445 00:26:07,080 --> 00:26:10,719 Speaker 1: plans for Palm Springs, for Atlanta, for Dallas, Austin, and 446 00:26:10,760 --> 00:26:14,400 Speaker 1: so on. What are the properties requirements. So we've got 447 00:26:14,400 --> 00:26:18,760 Speaker 1: four brands, UH, the Chatwell which is pure luxury UH, 448 00:26:18,840 --> 00:26:22,359 Speaker 1: the Dream Down Dream brand, which is one notch below 449 00:26:22,440 --> 00:26:25,239 Speaker 1: that time as well. Difference between those two. One has 450 00:26:25,280 --> 00:26:28,040 Speaker 1: a lot of food and beverage, one has middle middle 451 00:26:28,080 --> 00:26:31,160 Speaker 1: amount of food and beverage. And Unscripted, as I mentioned, 452 00:26:31,200 --> 00:26:35,720 Speaker 1: could also go in the secondary locations. So we're looking 453 00:26:35,720 --> 00:26:38,760 Speaker 1: for properties that makes sense for any of those four brands. 454 00:26:38,760 --> 00:26:42,120 Speaker 1: By adding an unscripted now we have hundreds and hundreds 455 00:26:42,119 --> 00:26:45,040 Speaker 1: of locations that one of our four brands makes sense for. 456 00:26:45,760 --> 00:26:49,119 Speaker 1: And looking for a good owner who UH is looking 457 00:26:49,119 --> 00:26:52,440 Speaker 1: for a lifestyle hotel, someone that's gonna bring the community 458 00:26:52,480 --> 00:26:56,359 Speaker 1: into the property and believes in UH. The concepts that 459 00:26:56,400 --> 00:27:00,520 Speaker 1: we're doing point to. You have money raising money. Do 460 00:27:00,560 --> 00:27:03,600 Speaker 1: you find that people are throwing money at this industry 461 00:27:03,640 --> 00:27:07,240 Speaker 1: because it has become such a glamorous part of lifestyle 462 00:27:07,440 --> 00:27:11,400 Speaker 1: or is it strictly business? You know, everything comes down 463 00:27:11,400 --> 00:27:14,840 Speaker 1: to business. You may have a high net worth individual 464 00:27:14,880 --> 00:27:17,520 Speaker 1: that just does a vanity play here or there, but 465 00:27:18,240 --> 00:27:20,040 Speaker 1: there's not a lot of that out there. So yeah, 466 00:27:20,040 --> 00:27:22,000 Speaker 1: it comes down to business and you've got to be 467 00:27:22,000 --> 00:27:25,159 Speaker 1: able to get them financed. UM. Wasn't very easy for 468 00:27:25,240 --> 00:27:27,480 Speaker 1: us early. You know, people don't know our brands. But 469 00:27:27,520 --> 00:27:32,040 Speaker 1: as we're growing now, uh, it's becoming a little easier. UM, 470 00:27:32,080 --> 00:27:35,000 Speaker 1: but it depends on the ever flow of how lenders 471 00:27:35,000 --> 00:27:38,000 Speaker 1: are lending. Last point you're having to do with travel 472 00:27:38,160 --> 00:27:42,800 Speaker 1: is where are you seeing outsized interest in new tourism? 473 00:27:42,960 --> 00:27:46,119 Speaker 1: Is it in these tertiary and secondary markets? You know, 474 00:27:46,200 --> 00:27:49,520 Speaker 1: I think there's tourism everywhere, and there always was. It 475 00:27:49,640 --> 00:27:51,960 Speaker 1: was interest in uh in great cities, and it was 476 00:27:52,000 --> 00:27:55,720 Speaker 1: interest in little quirky towns that had something special about them. 477 00:27:55,920 --> 00:27:59,040 Speaker 1: I think the difference now people are taking advantage of 478 00:27:59,080 --> 00:28:01,679 Speaker 1: those little quirky things they have if they're known for 479 00:28:02,119 --> 00:28:06,119 Speaker 1: some great food item or a unique experience that you 480 00:28:06,160 --> 00:28:09,360 Speaker 1: can do their UM. You know, people want to take 481 00:28:09,400 --> 00:28:12,240 Speaker 1: advantage as you as you know, everybody's talking about experiences 482 00:28:12,280 --> 00:28:15,160 Speaker 1: and experiences. So it's not just the hotel, it's it's 483 00:28:15,200 --> 00:28:17,480 Speaker 1: you want to travel, you want to go see things, 484 00:28:17,520 --> 00:28:19,919 Speaker 1: and there's a lot to see around this country and 485 00:28:19,960 --> 00:28:22,480 Speaker 1: around the globe, and people are as curious as ever. 486 00:28:22,720 --> 00:28:25,919 Speaker 1: And UM, I think our industry has a long way 487 00:28:25,960 --> 00:28:28,359 Speaker 1: to go. Thanks very much, Ja stun He is the 488 00:28:28,440 --> 00:28:33,879 Speaker 1: chief executive of Dream Hotel Group. Thanks for listening to 489 00:28:33,880 --> 00:28:36,800 Speaker 1: the Bloomberg P and L podcast. You can subscribe and 490 00:28:36,840 --> 00:28:40,840 Speaker 1: listen to interviews at Apple Podcasts, SoundCloud, or whatever podcast 491 00:28:40,840 --> 00:28:44,320 Speaker 1: platform you prefer. I'm Pim Fox. I'm on Twitter at 492 00:28:44,480 --> 00:28:47,880 Speaker 1: pim Fox. I'm on Twitter at Lisa Abramo. It's one 493 00:28:48,080 --> 00:28:50,760 Speaker 1: before the podcast. You can always catch us worldwide on 494 00:28:50,880 --> 00:28:51,680 Speaker 1: Bloomberg Radio.