1 00:00:00,280 --> 00:00:11,600 Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. This is Bloomberg Intelligence 2 00:00:11,720 --> 00:00:13,800 Speaker 1: with Alex Steel and Paul Sweeney. 3 00:00:13,920 --> 00:00:17,119 Speaker 2: The real ap performance has been in US corporate high yield. 4 00:00:17,320 --> 00:00:19,680 Speaker 3: Are the companies lean enough? Have they trimmed all the fats? 5 00:00:19,720 --> 00:00:22,880 Speaker 2: The semiconductor business is a really cyclical. 6 00:00:22,480 --> 00:00:26,680 Speaker 1: Business, breaking market headlines and corporate news from across the globe. 7 00:00:26,720 --> 00:00:29,200 Speaker 3: Do investors like the M and A that we've seen? 8 00:00:29,400 --> 00:00:32,360 Speaker 2: These are two big time blue chip companies. 9 00:00:32,600 --> 00:00:36,400 Speaker 3: Window between the peak and cunt changing super fast. 10 00:00:36,240 --> 00:00:41,280 Speaker 1: Bloomberg Intelligence with Alex Steele and Paul Sweeney on Bloomberg Radio. 11 00:00:42,560 --> 00:00:44,959 Speaker 2: On Today's Bloomberg Intelligence Show, we dig inside the big 12 00:00:45,000 --> 00:00:47,280 Speaker 2: business stories impacting Wall Street and the global markets. 13 00:00:47,360 --> 00:00:49,320 Speaker 3: Each and every week we provide in depth research and 14 00:00:49,400 --> 00:00:51,159 Speaker 3: data on some of the two thousand companies and one 15 00:00:51,240 --> 00:00:53,880 Speaker 3: hundred and thirty industries our analysts cover worldwide. 16 00:00:53,960 --> 00:00:56,800 Speaker 2: Today, we'll take a look at the telecommunications company Comcast 17 00:00:56,840 --> 00:00:58,640 Speaker 2: and how it's benefiting from its theme parks. 18 00:00:58,760 --> 00:01:00,680 Speaker 3: Plus we'll look at how oil and gas companies are 19 00:01:00,720 --> 00:01:02,760 Speaker 3: investing in low carbon technologies. 20 00:01:03,040 --> 00:01:03,160 Speaker 4: Well. 21 00:01:03,200 --> 00:01:05,840 Speaker 2: First, we begin with some news in tech and energy. 22 00:01:06,000 --> 00:01:08,480 Speaker 3: This week, Constellation Energy agreed to sell power from a 23 00:01:08,480 --> 00:01:11,720 Speaker 3: Clinton Nuclear Plan in Illinois to the tech giant Meta Platforms. 24 00:01:11,720 --> 00:01:14,680 Speaker 3: It's a twenty year contract starting in mid twenty twenty seven. 25 00:01:14,760 --> 00:01:16,920 Speaker 2: And this comes as nuclear power has emerged as one 26 00:01:16,959 --> 00:01:19,319 Speaker 2: of the biggest winners from the AI fueled search and 27 00:01:19,360 --> 00:01:20,319 Speaker 2: electricity demand. 28 00:01:20,520 --> 00:01:22,080 Speaker 3: For more on the tech side, we are joined by 29 00:01:22,080 --> 00:01:25,000 Speaker 3: man Deep saying Bloomberg Intelligence in your tech industry analyst, 30 00:01:25,160 --> 00:01:27,479 Speaker 3: and we first ask man Deep why Meta needs this 31 00:01:27,560 --> 00:01:29,200 Speaker 3: deal with Constellation. 32 00:01:29,319 --> 00:01:31,959 Speaker 5: If they're raising their capex, which they did it in 33 00:01:32,040 --> 00:01:36,000 Speaker 5: their last earnings, that capex is going towards you know, 34 00:01:36,040 --> 00:01:40,119 Speaker 5: getting more AI chips, and you know, if you are 35 00:01:40,160 --> 00:01:43,240 Speaker 5: putting more AI chips, you need more power. So clearly 36 00:01:43,880 --> 00:01:47,960 Speaker 5: that is where the shortage is right now. And look, 37 00:01:48,080 --> 00:01:52,440 Speaker 5: if this is an AI supercycle that we all believe 38 00:01:52,600 --> 00:01:55,400 Speaker 5: it is going to be the case, and I think 39 00:01:55,520 --> 00:01:58,560 Speaker 5: you will see a power supercycle as well. And in 40 00:01:58,600 --> 00:02:02,080 Speaker 5: this case, all the higher scalers will be looking to 41 00:02:02,160 --> 00:02:05,760 Speaker 5: procure power for their data centers. I mean, Meta serves 42 00:02:05,760 --> 00:02:10,959 Speaker 5: over three billion monthly active users across their family of apps. Now, granted, 43 00:02:11,440 --> 00:02:15,160 Speaker 5: those users right now are using more CPU compute, but 44 00:02:15,200 --> 00:02:19,600 Speaker 5: if you're rolling out AI tools and LLM searches, you 45 00:02:19,720 --> 00:02:22,320 Speaker 5: need more power for the AI chips, and I think 46 00:02:22,360 --> 00:02:23,680 Speaker 5: that's the intent here. 47 00:02:24,200 --> 00:02:25,520 Speaker 6: And Mandy, let's be honest here. 48 00:02:25,560 --> 00:02:27,920 Speaker 2: I mean, all you tech guys, you Silicon Valley guys, 49 00:02:27,919 --> 00:02:30,280 Speaker 2: you always think you're the smartest guys in the room. 50 00:02:30,680 --> 00:02:31,440 Speaker 6: But let's be honest. 51 00:02:31,480 --> 00:02:33,840 Speaker 2: You guys don't know anything about the oil and gas 52 00:02:33,880 --> 00:02:36,960 Speaker 2: business and the nuclear business. Why is Meta And I'm 53 00:02:37,000 --> 00:02:39,079 Speaker 2: guessing some others are going to kind of get more 54 00:02:39,160 --> 00:02:43,160 Speaker 2: deeply and strategically involved in the energy side of their business. 55 00:02:43,200 --> 00:02:44,040 Speaker 6: Is this a trend here? 56 00:02:44,680 --> 00:02:47,760 Speaker 5: Just look at how far they have come in terms 57 00:02:47,840 --> 00:02:51,400 Speaker 5: of you know, infrastructure, like a company like Google. Not 58 00:02:51,520 --> 00:02:55,320 Speaker 5: only are they designing their own data centers and you know, 59 00:02:56,240 --> 00:03:00,360 Speaker 5: creating their own chips, and now they are you know, 60 00:03:00,480 --> 00:03:04,000 Speaker 5: procuring power to the extent that they want to make 61 00:03:04,040 --> 00:03:08,800 Speaker 5: sure that these AI chips, which can have volatile power needs, 62 00:03:09,240 --> 00:03:12,960 Speaker 5: are most optimized when it comes to the efficiency of 63 00:03:13,000 --> 00:03:18,200 Speaker 5: their infrastructure. And that's why these hyperscalar companies really have 64 00:03:18,360 --> 00:03:21,639 Speaker 5: got so many different aspects to their mode. So it's 65 00:03:21,680 --> 00:03:25,320 Speaker 5: not just about the search algorithm or in the case 66 00:03:25,360 --> 00:03:28,360 Speaker 5: of Meta, you know, their social media knowledge graph. It 67 00:03:28,480 --> 00:03:31,760 Speaker 5: is about the entirety of how they run their infrastructure, 68 00:03:31,800 --> 00:03:34,280 Speaker 5: and that is what is a long term mode, because 69 00:03:34,320 --> 00:03:38,200 Speaker 5: nobody else can operate at the scale at at which 70 00:03:38,440 --> 00:03:40,440 Speaker 5: these hyperscalers are operating right now. 71 00:03:40,640 --> 00:03:42,440 Speaker 3: This is a fun fact in the article Bible Rate 72 00:03:42,560 --> 00:03:44,880 Speaker 3: from Bloomberg. So Meta first of all, has a global 73 00:03:44,960 --> 00:03:45,520 Speaker 3: energy head. 74 00:03:45,920 --> 00:03:49,160 Speaker 6: They have a global energy head. Okay, all right, so 75 00:03:49,200 --> 00:03:49,480 Speaker 6: they do. 76 00:03:49,560 --> 00:03:51,600 Speaker 3: They're really kind of ramping that out, and they were 77 00:03:51,640 --> 00:03:54,360 Speaker 3: looking at proposals. They announced in December they were looking 78 00:03:54,400 --> 00:03:56,680 Speaker 3: at proposals for as much as coore gigawatts of new 79 00:03:56,800 --> 00:04:01,520 Speaker 3: US reactors, and it received fifty from a range of companies, 80 00:04:01,840 --> 00:04:07,480 Speaker 3: including Constellation. To that point, I'm also wondering Mande the 81 00:04:07,520 --> 00:04:11,600 Speaker 3: significance of when they're building data centers and hyperscalers for lllms, 82 00:04:11,600 --> 00:04:14,280 Speaker 3: a large language model and that training versus when they 83 00:04:14,320 --> 00:04:17,160 Speaker 3: have to build stuff for inference, which could be smaller 84 00:04:17,200 --> 00:04:20,000 Speaker 3: and more co located, so closer to the cities, closer 85 00:04:20,000 --> 00:04:22,080 Speaker 3: to our Paul and I have our phone. Does that 86 00:04:22,080 --> 00:04:24,800 Speaker 3: tend to look different than in terms of their power needs. 87 00:04:25,200 --> 00:04:28,800 Speaker 5: Absolutely, And I think so far the market was concentrated 88 00:04:28,839 --> 00:04:33,320 Speaker 5: towards training. Every year you would have a ten times 89 00:04:33,440 --> 00:04:37,640 Speaker 5: larger model, which was more intelligent and it could do 90 00:04:37,760 --> 00:04:40,320 Speaker 5: more in terms of you know, answering your queries. But 91 00:04:40,760 --> 00:04:44,520 Speaker 5: with inferencing your right. I mean, the traffic patterns may 92 00:04:44,600 --> 00:04:48,520 Speaker 5: vary depending on the population, and so if you're serving 93 00:04:48,520 --> 00:04:52,160 Speaker 5: traffic in New York, it's very different from serving traffic 94 00:04:52,200 --> 00:04:55,200 Speaker 5: somewhere else that may not have the same concentration. And 95 00:04:56,000 --> 00:04:59,280 Speaker 5: with that, I think the challenge these companies have had 96 00:04:59,360 --> 00:05:03,160 Speaker 5: is the transfer lines can be upgraded. I mean you need, 97 00:05:03,880 --> 00:05:07,640 Speaker 5: you know, a pretty lengthy review process and the whole 98 00:05:07,680 --> 00:05:11,080 Speaker 5: thing may take years. So right now they are trying 99 00:05:11,120 --> 00:05:15,960 Speaker 5: to procure power wherever they can to offset the increased consumption, 100 00:05:16,160 --> 00:05:18,760 Speaker 5: and some of it may come at the expense of 101 00:05:18,960 --> 00:05:24,599 Speaker 5: power usage for some other purpose. Then you know why 102 00:05:24,680 --> 00:05:28,919 Speaker 5: data center is being prioritized here, and that is what 103 00:05:29,040 --> 00:05:32,920 Speaker 5: will be interesting because with inferencing, the power needs can 104 00:05:32,960 --> 00:05:35,160 Speaker 5: be variable. I mean, one trend we have seen is 105 00:05:35,480 --> 00:05:39,800 Speaker 5: with reasoning, you need more compute, so you know, the 106 00:05:39,880 --> 00:05:42,440 Speaker 5: model is thinking a lot more at the time you 107 00:05:42,480 --> 00:05:45,440 Speaker 5: are putting the prompt in, as opposed to training, where 108 00:05:45,640 --> 00:05:48,640 Speaker 5: all of the training is happening in background over a 109 00:05:48,720 --> 00:05:51,760 Speaker 5: period of a few weeks. So reasoning is per query 110 00:05:52,320 --> 00:05:55,560 Speaker 5: and depending on how complex your query is the model 111 00:05:55,640 --> 00:05:57,520 Speaker 5: is doing more work and that's why it may need 112 00:05:57,560 --> 00:05:58,080 Speaker 5: more power. 113 00:05:58,600 --> 00:06:01,760 Speaker 2: Another data point from this new Bloomberg News article, Meta 114 00:06:01,839 --> 00:06:05,200 Speaker 2: is contracting for more power after the company's total electricity 115 00:06:05,200 --> 00:06:08,160 Speaker 2: consumption nearly tripled from twenty. 116 00:06:07,960 --> 00:06:10,440 Speaker 6: Nineteen to twenty twenty three. So yeah, I guess they 117 00:06:11,279 --> 00:06:13,240 Speaker 6: need some more energy man deposition in the. 118 00:06:13,160 --> 00:06:16,679 Speaker 2: CAPEX numbers for Meta and for these other tech companies, 119 00:06:16,760 --> 00:06:18,880 Speaker 2: or they need to take those CAPEX numbers up even 120 00:06:18,920 --> 00:06:21,120 Speaker 2: more if they're going to get deeper into the energy space. 121 00:06:21,720 --> 00:06:25,320 Speaker 5: I mean, all signs are the CAPEX numbers may continue 122 00:06:25,360 --> 00:06:29,600 Speaker 5: to go up, but right now, the biggest component of 123 00:06:29,640 --> 00:06:34,560 Speaker 5: the CAPEX is still the spend on the GPU chips. Obviously, 124 00:06:34,600 --> 00:06:38,080 Speaker 5: the power needs will take some portion of the CAPEX, 125 00:06:38,080 --> 00:06:40,680 Speaker 5: but it's still not as big as the chips. And 126 00:06:40,760 --> 00:06:42,880 Speaker 5: think of it this way. If you're getting you know, 127 00:06:43,400 --> 00:06:47,160 Speaker 5: twenty thousand Nvidia chips, the cost of keeping them idle 128 00:06:47,279 --> 00:06:49,599 Speaker 5: or not being able to utilize them one hundred percent 129 00:06:49,720 --> 00:06:52,840 Speaker 5: is way higher than anything you are spending in terms of, 130 00:06:53,240 --> 00:06:56,480 Speaker 5: you know, the energy deal that they had. So clearly 131 00:06:56,600 --> 00:06:59,760 Speaker 5: they are focusing on utilizing the chips that they have already, 132 00:07:00,360 --> 00:07:04,080 Speaker 5: and that's why they are proactive with you know, these 133 00:07:04,120 --> 00:07:04,839 Speaker 5: power deals. 134 00:07:05,400 --> 00:07:07,839 Speaker 2: Our thanks to Man Deep Seeing Bloomberg Intelligence senior tech 135 00:07:07,839 --> 00:07:08,640 Speaker 2: industry analyst. 136 00:07:09,080 --> 00:07:11,720 Speaker 3: We recently focused on a Bloomberg Big Take story entitled 137 00:07:11,760 --> 00:07:15,080 Speaker 3: A fatal Tesla crash shows the limits of full self Driving. 138 00:07:15,200 --> 00:07:17,440 Speaker 3: You can find it on Bloomberg dot Com and the Terminal. 139 00:07:17,560 --> 00:07:20,320 Speaker 2: The story looks at how federal regulators are investigating whether 140 00:07:20,400 --> 00:07:24,280 Speaker 2: Tesla's robotaxi system is dangerous even with the human behind 141 00:07:24,280 --> 00:07:24,640 Speaker 2: the wheel. 142 00:07:24,680 --> 00:07:26,880 Speaker 3: From where we were joined by Craig Trudell, Bloomberg Global 143 00:07:26,920 --> 00:07:29,400 Speaker 3: Autos Editor. We first asked Craig to walk us through 144 00:07:29,440 --> 00:07:32,360 Speaker 3: the details of what the issues are with completely autonomous vehicles. 145 00:07:32,800 --> 00:07:35,040 Speaker 7: I guess maybe the thing to start with is the 146 00:07:35,120 --> 00:07:37,160 Speaker 7: Teslas that you can buy today that are on the 147 00:07:37,240 --> 00:07:40,800 Speaker 7: road now are not that right. They are not autonomous. 148 00:07:41,080 --> 00:07:45,560 Speaker 7: You can pay extra for a system called full self driving, 149 00:07:45,600 --> 00:07:49,440 Speaker 7: and yet it's a miss snowmer. It's a system that 150 00:07:49,480 --> 00:07:52,720 Speaker 7: you have to pay attention to at all times. You know, 151 00:07:53,040 --> 00:07:55,920 Speaker 7: if you get into a crash, it is it is 152 00:07:56,000 --> 00:07:59,280 Speaker 7: on you. And we've seen that, you know, play out 153 00:08:00,080 --> 00:08:02,560 Speaker 7: when Tesla customers have you know, tried to come after 154 00:08:02,600 --> 00:08:05,280 Speaker 7: the company. The company says, look, you know, we we 155 00:08:06,000 --> 00:08:08,880 Speaker 7: warned you. We told you that you know, you're you're 156 00:08:08,960 --> 00:08:13,040 Speaker 7: responsible for driving while using this system. The company is 157 00:08:13,080 --> 00:08:15,160 Speaker 7: trying to make this leap, that's been trying to make 158 00:08:15,160 --> 00:08:17,880 Speaker 7: the sleep for years, to eventually get to a point 159 00:08:17,880 --> 00:08:21,040 Speaker 7: where you do not have to to supervise and you know, 160 00:08:21,520 --> 00:08:24,120 Speaker 7: even to take it further than that, you know, take 161 00:08:24,120 --> 00:08:27,280 Speaker 7: the human out from behind the wheel altogether. And we 162 00:08:27,360 --> 00:08:30,240 Speaker 7: hear Musk, you know, talk about that quite a bit 163 00:08:30,360 --> 00:08:33,479 Speaker 7: lately because it's something that they're actually trying to commercialize, 164 00:08:33,800 --> 00:08:36,120 Speaker 7: even just in the next matter of you know, next 165 00:08:36,120 --> 00:08:40,000 Speaker 7: week or so. There's a lot of questions about how 166 00:08:40,080 --> 00:08:43,080 Speaker 7: exactly they intend to do that, whether they can do it, 167 00:08:43,240 --> 00:08:46,840 Speaker 7: especially after he's predicted, you know, year after year that 168 00:08:46,840 --> 00:08:49,199 Speaker 7: they're on the cusp of doing it. And part of 169 00:08:49,240 --> 00:08:52,920 Speaker 7: the reason there are doubts is is because of the hardware. 170 00:08:52,960 --> 00:08:55,520 Speaker 7: And I think that's kind of an important aspect of 171 00:08:55,520 --> 00:08:59,720 Speaker 7: today's story is is this particular crash involves, you know, 172 00:09:00,320 --> 00:09:03,120 Speaker 7: an incident where a driver was using full self driving 173 00:09:03,320 --> 00:09:07,559 Speaker 7: driving into the sun, and that appeared to play a 174 00:09:07,600 --> 00:09:12,120 Speaker 7: part in the crash, which resulted in a fatality, and 175 00:09:12,200 --> 00:09:15,719 Speaker 7: it led to a federal investigation that is ongoing. 176 00:09:18,360 --> 00:09:21,520 Speaker 3: I mean, this is all very much feels as part 177 00:09:21,559 --> 00:09:23,600 Speaker 3: of the growing pains as we kind of understand this 178 00:09:23,679 --> 00:09:27,320 Speaker 3: technology and how it works itself out. So what are 179 00:09:27,360 --> 00:09:29,880 Speaker 3: the steps that Tesla's taking and that the regulators are 180 00:09:29,880 --> 00:09:30,680 Speaker 3: taking at this time. 181 00:09:32,280 --> 00:09:35,240 Speaker 7: Yeah, so you know, we should acknowledge that this incident 182 00:09:35,320 --> 00:09:39,240 Speaker 7: happened in November twenty twenty three. You know, Tesla has 183 00:09:39,280 --> 00:09:44,000 Speaker 7: has changed. They've they've made upgrades both to hardware and software. 184 00:09:44,600 --> 00:09:48,240 Speaker 7: You know, hardware for certain customers, they should say, but 185 00:09:48,400 --> 00:09:53,359 Speaker 7: you know, in terms of their approach to the sensor 186 00:09:53,400 --> 00:09:57,080 Speaker 7: system for their vehicles, Elon Musk has been you know, 187 00:09:57,120 --> 00:09:59,880 Speaker 7: really sort of out on a limb and having this 188 00:10:00,080 --> 00:10:04,040 Speaker 7: you that all you need is cameras and company companies 189 00:10:04,080 --> 00:10:06,440 Speaker 7: that are also in this space. I think the one 190 00:10:06,559 --> 00:10:10,560 Speaker 7: people recognize the most is Weimo, the Google company, and 191 00:10:11,160 --> 00:10:14,040 Speaker 7: they use a mix of camera, radar and wide R 192 00:10:14,240 --> 00:10:18,000 Speaker 7: and their sensor set is much more expensive. It's more extensive. 193 00:10:18,240 --> 00:10:20,200 Speaker 7: You know, these sensors are placed all over the vehicle. 194 00:10:21,640 --> 00:10:24,880 Speaker 7: But you know, the sort of bet here on the 195 00:10:24,880 --> 00:10:27,240 Speaker 7: part of Weimo is that is worth it. It will 196 00:10:27,280 --> 00:10:30,160 Speaker 7: mean this system is safer. What Musk has tried to 197 00:10:30,200 --> 00:10:33,599 Speaker 7: do is go with the cheaper route, go with the 198 00:10:34,640 --> 00:10:36,600 Speaker 7: you know system that he can afford to put in 199 00:10:36,640 --> 00:10:39,600 Speaker 7: every Tesla, and make this bet that you know, he 200 00:10:39,640 --> 00:10:44,000 Speaker 7: can develop his way to autonomy faster by sort of 201 00:10:44,080 --> 00:10:47,680 Speaker 7: leveraging the broader Tesla fleet, even if it means putting 202 00:10:47,800 --> 00:10:50,559 Speaker 7: you know, cars on the road that you know, draw 203 00:10:50,600 --> 00:10:53,640 Speaker 7: scrutiny from federal regulators as to whether or not that 204 00:10:53,760 --> 00:10:58,240 Speaker 7: this is you know, unreasonably unsafe. 205 00:10:59,440 --> 00:11:03,600 Speaker 2: So, Craig, I think Elon Musk is back at the company. 206 00:11:04,600 --> 00:11:05,280 Speaker 6: What does that mean? 207 00:11:05,440 --> 00:11:08,080 Speaker 2: I mean, are you hearing anything like, Okay, now we 208 00:11:08,120 --> 00:11:09,080 Speaker 2: can get back on track. 209 00:11:09,160 --> 00:11:11,880 Speaker 6: Now we can really move forward, maybe at you know, 210 00:11:12,160 --> 00:11:13,600 Speaker 6: higher velocity. What's that mean? 211 00:11:15,280 --> 00:11:17,560 Speaker 7: Yeah? I'm you know, I think it's difficult to tell 212 00:11:17,559 --> 00:11:20,839 Speaker 7: at this point because he's kind of coming back to 213 00:11:21,000 --> 00:11:24,920 Speaker 7: business means coming back to so many businesses, right, and 214 00:11:25,040 --> 00:11:28,200 Speaker 7: so on a day to day yeah, we're you know, 215 00:11:28,360 --> 00:11:32,160 Speaker 7: we're seeing him travel to to his various companies, you know, 216 00:11:32,360 --> 00:11:35,760 Speaker 7: devoting some time and attention to to them. But it's 217 00:11:35,840 --> 00:11:38,560 Speaker 7: not as though he's sort of one hundred percent, uh, 218 00:11:38,840 --> 00:11:42,440 Speaker 7: you know, focusing in on Tesla and neglecting all of 219 00:11:42,480 --> 00:11:46,079 Speaker 7: his other businesses. We see him, you know, regularly engaging 220 00:11:46,120 --> 00:11:50,200 Speaker 7: with you know, users on x about you know, troubleshooting 221 00:11:50,520 --> 00:11:53,400 Speaker 7: problems that they have with that service. You know, I 222 00:11:53,559 --> 00:11:58,200 Speaker 7: would say he is you know, more actively engaging there 223 00:11:58,280 --> 00:12:02,880 Speaker 7: on on teslas and definitely is trying to sort of 224 00:12:02,880 --> 00:12:05,600 Speaker 7: send this signal that you know, okay, it's it's time 225 00:12:05,640 --> 00:12:08,400 Speaker 7: to get back to business here. But whether or not 226 00:12:08,520 --> 00:12:11,040 Speaker 7: that's you know, resulting in sort of tangible changes at 227 00:12:11,040 --> 00:12:12,559 Speaker 7: the company, I think remains. 228 00:12:12,160 --> 00:12:12,600 Speaker 8: To be seen. 229 00:12:13,120 --> 00:12:16,200 Speaker 3: What's the rush for autonomous driving? 230 00:12:18,240 --> 00:12:22,280 Speaker 7: You know, I think forty thousand people die on US 231 00:12:22,360 --> 00:12:24,800 Speaker 7: roads every year, right, and so the rush of course 232 00:12:24,880 --> 00:12:27,559 Speaker 7: is to bend that, you know, to to change that. 233 00:12:27,720 --> 00:12:30,360 Speaker 7: And I think one of the challenges that you have 234 00:12:30,480 --> 00:12:33,400 Speaker 7: if you're a company in this space is we've now 235 00:12:33,559 --> 00:12:35,760 Speaker 7: you know, seen a lot of companies pursue this for 236 00:12:35,880 --> 00:12:38,680 Speaker 7: you know, roughly a decade. That number has not budged. 237 00:12:38,760 --> 00:12:41,200 Speaker 7: So you know, we still have a long way to 238 00:12:41,280 --> 00:12:46,520 Speaker 7: go to where this capability is you know, making putting 239 00:12:46,520 --> 00:12:47,720 Speaker 7: a dent in those figures. 240 00:12:48,240 --> 00:12:48,480 Speaker 9: All right. 241 00:12:48,480 --> 00:12:51,480 Speaker 3: Thanks to Craig Drudell, Bloomberg Global Autos editor coming up 242 00:12:51,520 --> 00:12:54,200 Speaker 3: a conversation with the CEO of Tay Technologies and the 243 00:12:54,200 --> 00:12:56,800 Speaker 3: company's approach to commercial fusion power. 244 00:12:56,920 --> 00:12:59,560 Speaker 2: You're listening to Bloomberg Intelligence on Bloomberg Radio, but riding 245 00:12:59,640 --> 00:13:01,880 Speaker 2: in depth research and data on two thousand companies in 246 00:13:01,920 --> 00:13:04,800 Speaker 2: one hundred and thirty industries. You can access Bloomberg Intelligence 247 00:13:04,880 --> 00:13:06,120 Speaker 2: via b I go on the terminal. 248 00:13:06,160 --> 00:13:08,840 Speaker 3: I'm Paul Sweeney, an amalk Steel, and this is Bloomberg. 249 00:13:13,640 --> 00:13:17,360 Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live 250 00:13:17,440 --> 00:13:20,480 Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android 251 00:13:20,520 --> 00:13:23,840 Speaker 1: Auto with the Bloomberg Business App. Listen on demand wherever 252 00:13:23,880 --> 00:13:26,959 Speaker 1: you get your podcasts, or watch us live on YouTube. 253 00:13:27,800 --> 00:13:29,920 Speaker 3: We move next to the telecommunication space. 254 00:13:30,280 --> 00:13:33,360 Speaker 2: The cable provider Comcast recently opened its newest theme park 255 00:13:33,400 --> 00:13:37,000 Speaker 2: in Florida, called Universal Epic Universe. The goal is to 256 00:13:37,040 --> 00:13:39,360 Speaker 2: keep guests staying longer and spending more in the competitive 257 00:13:39,480 --> 00:13:40,600 Speaker 2: Orlando market. 258 00:13:40,440 --> 00:13:43,600 Speaker 3: And according to research from Bloomberg Intelligence, Comcast theme parks 259 00:13:43,600 --> 00:13:46,760 Speaker 3: are poised to become of its most valuable assets, with 260 00:13:46,880 --> 00:13:49,880 Speaker 3: revenue and IBADASA to jump around forty percent from twenty 261 00:13:49,920 --> 00:13:51,600 Speaker 3: twenty four to twenty twenty six. 262 00:13:52,000 --> 00:13:54,560 Speaker 2: For more on what this means, guest host John Tucker 263 00:13:54,559 --> 00:13:57,160 Speaker 2: and I were joined by Githa Rong Andathan Bloomberg, intelligence 264 00:13:57,280 --> 00:14:00,360 Speaker 2: US media analyst, who first asked Githa to talk about 265 00:14:00,400 --> 00:14:01,439 Speaker 2: Universal's new park. 266 00:14:01,960 --> 00:14:05,160 Speaker 8: May twenty second was the grand opening of Epic Universe 267 00:14:05,280 --> 00:14:09,000 Speaker 8: in Florida. This is the first big park that has 268 00:14:09,040 --> 00:14:12,280 Speaker 8: opened in Florida in twenty five years, and it was 269 00:14:12,520 --> 00:14:15,400 Speaker 8: the biggest investment by Comcast in a theme park. They 270 00:14:15,440 --> 00:14:18,520 Speaker 8: spent over seven billion dollars on just this park. So, 271 00:14:18,640 --> 00:14:22,080 Speaker 8: as you said, huge investments by Comcast in their theme 272 00:14:22,120 --> 00:14:25,040 Speaker 8: park business. This is really an area of growth for them, 273 00:14:25,720 --> 00:14:29,120 Speaker 8: especially now that their broadband business is struggling actually quite 274 00:14:29,160 --> 00:14:29,400 Speaker 8: a bit. 275 00:14:29,840 --> 00:14:31,760 Speaker 10: So what is this likely to do for their earnings? 276 00:14:33,000 --> 00:14:35,360 Speaker 8: So, you know, you kind of think about Comcast and 277 00:14:35,360 --> 00:14:39,760 Speaker 8: you think about Disney. For Comcast, so let me start 278 00:14:39,800 --> 00:14:42,640 Speaker 8: with Disney. So for Disney, parks is actually sixty percent 279 00:14:42,640 --> 00:14:46,560 Speaker 8: of their profits. For Comcasts, it's really maybe less than 280 00:14:46,600 --> 00:14:50,320 Speaker 8: six percent. So again for Comcasts, you know, eighty percent 281 00:14:50,400 --> 00:14:52,840 Speaker 8: of their of their money, of their profits still comes 282 00:14:52,840 --> 00:14:55,160 Speaker 8: from the cable business. But really, as we kind of 283 00:14:55,200 --> 00:14:58,360 Speaker 8: think about what their strategy is here and you look 284 00:14:58,360 --> 00:15:01,000 Speaker 8: at all of their portfolio of assets, I mean, we're 285 00:15:01,080 --> 00:15:04,320 Speaker 8: really excited about the theme park business because growth is great, 286 00:15:04,520 --> 00:15:07,840 Speaker 8: returns on investment are great, and this is really a 287 00:15:07,840 --> 00:15:11,160 Speaker 8: fantastic way for comcasts, just like what Disney has done 288 00:15:11,280 --> 00:15:14,360 Speaker 8: with kind of deepening all of those relationships with those 289 00:15:14,440 --> 00:15:16,680 Speaker 8: universal characters. You think of all the ip that they 290 00:15:16,680 --> 00:15:19,960 Speaker 8: have with Minions, with Jurassic Park, now with Wicked, you know, 291 00:15:19,960 --> 00:15:22,120 Speaker 8: and some of the other franchises that they have with 292 00:15:22,160 --> 00:15:25,280 Speaker 8: Harry Potter. You know, this is just such a great 293 00:15:25,320 --> 00:15:27,520 Speaker 8: way to build on that fan engagement. 294 00:15:28,280 --> 00:15:30,080 Speaker 2: How much can the theme park business, how much do 295 00:15:30,080 --> 00:15:32,560 Speaker 2: you think that could be worth for comcasts? Because again 296 00:15:32,600 --> 00:15:36,200 Speaker 2: you mentioned that some of their core businesses, like the 297 00:15:36,280 --> 00:15:39,200 Speaker 2: video business, the tridtional cable business, even the broadband business, 298 00:15:39,200 --> 00:15:42,280 Speaker 2: they're facing some headwinds here. Theme parks are going to 299 00:15:42,280 --> 00:15:45,440 Speaker 2: become more and more important important for investors I think 300 00:15:45,480 --> 00:15:47,240 Speaker 2: going forward. So what do you think the valuation could. 301 00:15:47,040 --> 00:15:50,600 Speaker 8: Be absolutely, Paul, So that's a really really important point 302 00:15:50,600 --> 00:15:52,240 Speaker 8: that you bring up. So you think of the cable business, 303 00:15:52,240 --> 00:15:55,680 Speaker 8: which is really their mainstay. Cable valuations have actually dropped 304 00:15:55,760 --> 00:15:58,400 Speaker 8: pretty significantly over the past few years. We've gone from 305 00:15:58,440 --> 00:16:01,320 Speaker 8: about ten x to around six and a half to 306 00:16:01,400 --> 00:16:05,320 Speaker 8: seven times EBITDA multiple you think about the park business though, 307 00:16:05,360 --> 00:16:07,720 Speaker 8: it's actually quite the opposite. You know, most of the 308 00:16:08,120 --> 00:16:10,400 Speaker 8: some of the pure play pure play park operators are 309 00:16:10,440 --> 00:16:13,480 Speaker 8: treating it about you know, twelve to fourteen times IBADA. 310 00:16:13,600 --> 00:16:16,480 Speaker 8: So again this is an area of growth. You know, 311 00:16:16,600 --> 00:16:20,760 Speaker 8: experiential businesses are seeing this huge upswing. And so we 312 00:16:20,840 --> 00:16:24,120 Speaker 8: think that just based on about five billion in ibitdah, 313 00:16:24,160 --> 00:16:26,560 Speaker 8: which we think Comcasts can get to in a few 314 00:16:26,640 --> 00:16:29,640 Speaker 8: years time, that business could be easily worth you know, 315 00:16:29,720 --> 00:16:32,480 Speaker 8: forty five fifty billion dollars or upwards of that. 316 00:16:33,600 --> 00:16:37,240 Speaker 10: So my takeaway is there are Disney wanna be at 317 00:16:37,240 --> 00:16:39,160 Speaker 10: this point. I got to wonder if like they're going 318 00:16:39,200 --> 00:16:41,160 Speaker 10: to start poaching Disney executives too. 319 00:16:42,880 --> 00:16:45,720 Speaker 8: That's very possible. I mean, right now, there's still a 320 00:16:45,760 --> 00:16:48,520 Speaker 8: pretty small player John when you compare them to Disney. 321 00:16:48,520 --> 00:16:50,400 Speaker 8: So you just kind of think about Disney in terms 322 00:16:50,440 --> 00:16:53,000 Speaker 8: of theme park visitations. We are looking at about one 323 00:16:53,080 --> 00:16:56,840 Speaker 8: hundred and fifty million global visitors to Disney parks every year. 324 00:16:57,200 --> 00:17:00,680 Speaker 8: Compare that to Universal or Comcast sparks it's about sixty million, 325 00:17:00,960 --> 00:17:03,960 Speaker 8: So still much smaller than Disney. But what they're doing 326 00:17:03,960 --> 00:17:05,840 Speaker 8: now is a lot of expansion. So we had this 327 00:17:05,920 --> 00:17:09,040 Speaker 8: new park, Epic Universe, which opened just last week. They're 328 00:17:09,040 --> 00:17:11,920 Speaker 8: actually opening a new park in London in a few 329 00:17:11,960 --> 00:17:15,520 Speaker 8: years time. They're expanding with new properties in Las Vegas 330 00:17:15,600 --> 00:17:18,520 Speaker 8: in Texas. So basically, when you put all of that together, 331 00:17:18,640 --> 00:17:21,800 Speaker 8: we're thinking that they are basically going to expand visitation 332 00:17:21,840 --> 00:17:24,560 Speaker 8: from about sixty million to by fifty percent to about 333 00:17:24,720 --> 00:17:27,560 Speaker 8: you know, eighty to ninety million. So they're really kind 334 00:17:27,560 --> 00:17:32,040 Speaker 8: of closing in on that gap with Disney stepping back. 335 00:17:32,240 --> 00:17:35,560 Speaker 2: The Comcast stock story, I mean, how do people view 336 00:17:35,600 --> 00:17:39,320 Speaker 2: it here, because again, cable TV business just in secular decline. 337 00:17:39,400 --> 00:17:42,440 Speaker 2: The broadband business, which had saved it for a good 338 00:17:42,480 --> 00:17:45,639 Speaker 2: decade or so, that seems to be stalling because a 339 00:17:45,680 --> 00:17:48,160 Speaker 2: competition and the cable networks, I don't know what they're 340 00:17:48,200 --> 00:17:51,320 Speaker 2: doing with them. What do investors think about Comcast. 341 00:17:52,400 --> 00:17:55,120 Speaker 8: Yeah, it's really a tough story right now, Paul, as 342 00:17:55,160 --> 00:17:58,720 Speaker 8: you rightly point out, I mean, broadband is again majority 343 00:17:58,760 --> 00:18:01,560 Speaker 8: of this business is really tough to how broadband does. 344 00:18:01,680 --> 00:18:05,000 Speaker 8: So you know, any stock movements are directly correlated to 345 00:18:05,520 --> 00:18:07,439 Speaker 8: the health of the broadband business, which actually is in 346 00:18:07,480 --> 00:18:10,119 Speaker 8: a very very tough spot right now. So this is 347 00:18:10,119 --> 00:18:12,359 Speaker 8: a business that was gaining about one to two million 348 00:18:12,400 --> 00:18:15,359 Speaker 8: subscribers every year. They are still one of the largest 349 00:18:15,359 --> 00:18:18,560 Speaker 8: broadband providers at about thirty million subscribers in the US, 350 00:18:18,880 --> 00:18:21,199 Speaker 8: but they are going to lose close to about a 351 00:18:21,200 --> 00:18:23,760 Speaker 8: million subscribers this year. As you know, the telecoms kind 352 00:18:23,760 --> 00:18:27,919 Speaker 8: of really intensified competition. So it's really a tough story 353 00:18:28,000 --> 00:18:29,800 Speaker 8: right now. The one thing that we are kind of 354 00:18:29,840 --> 00:18:32,199 Speaker 8: looking at in terms of a positive catalyst is the 355 00:18:32,240 --> 00:18:35,399 Speaker 8: spin off of the cable networks. So this is something 356 00:18:35,400 --> 00:18:38,520 Speaker 8: that they announced last year. It probably happens a little 357 00:18:38,520 --> 00:18:41,600 Speaker 8: bit later this year. They're calling it Versut. What's going 358 00:18:41,680 --> 00:18:43,399 Speaker 8: to be interesting is not just the spin but what 359 00:18:43,480 --> 00:18:46,159 Speaker 8: happens after the spin. So will Comcast really look to 360 00:18:46,280 --> 00:18:51,120 Speaker 8: become kind of this consolidator of media assets and that would, 361 00:18:51,160 --> 00:18:52,879 Speaker 8: I think be a little bit of an interesting story 362 00:18:52,880 --> 00:18:56,760 Speaker 8: in media. But unless they can really revive growth in 363 00:18:56,800 --> 00:18:59,040 Speaker 8: their broadband business, I think it's going to be a 364 00:18:59,080 --> 00:18:59,960 Speaker 8: little bit of a tough sell. 365 00:19:00,280 --> 00:19:04,280 Speaker 10: What's Disney's response to Universal to Comcast? 366 00:19:05,040 --> 00:19:08,800 Speaker 8: So Disney a huge response in terms of what they 367 00:19:08,880 --> 00:19:11,360 Speaker 8: have planned over the next few years. John, So they 368 00:19:11,359 --> 00:19:14,760 Speaker 8: are really kind of doubling down on their parks business. Again, 369 00:19:14,800 --> 00:19:17,200 Speaker 8: this is really the bread and butter for Disney. Sixty 370 00:19:17,240 --> 00:19:20,119 Speaker 8: percent of their profit comes from the parks business. So 371 00:19:20,160 --> 00:19:24,520 Speaker 8: they have about a sixty billion investment planned for parks 372 00:19:24,880 --> 00:19:27,399 Speaker 8: over the next you know, seven to eight years. And 373 00:19:27,440 --> 00:19:30,120 Speaker 8: it's not just the theme park experience, it's you know, 374 00:19:30,359 --> 00:19:32,600 Speaker 8: they're having parks on water, what they call parks on water, 375 00:19:32,600 --> 00:19:36,280 Speaker 8: which are the cruises, and that's a huge investment for them. 376 00:19:36,720 --> 00:19:40,040 Speaker 8: You know, we think that that business basically doubles triples 377 00:19:40,080 --> 00:19:42,960 Speaker 8: revenue as they keep on adding these new cruise ships, 378 00:19:44,280 --> 00:19:47,240 Speaker 8: you know, to their fleet. So are they are doubling 379 00:19:47,280 --> 00:19:48,440 Speaker 8: down on parks as well? 380 00:19:48,880 --> 00:19:49,119 Speaker 5: All right? 381 00:19:49,119 --> 00:19:52,240 Speaker 3: Thanks together, mang An Athen Bloomberg, Intelligence analyst on US Media. 382 00:19:52,520 --> 00:19:54,840 Speaker 2: We've moved next to the energy space this week. 383 00:19:54,880 --> 00:19:57,719 Speaker 3: We looked at a company called Tay Technologies. Tay develops 384 00:19:57,720 --> 00:20:00,640 Speaker 3: commercial fusion power with the cleanest environment profile. 385 00:20:00,920 --> 00:20:03,639 Speaker 2: The company also recently raised more than one hundred and 386 00:20:03,640 --> 00:20:06,320 Speaker 2: fifty million dollars in its latest funding round, exceeding the 387 00:20:06,320 --> 00:20:08,000 Speaker 2: company's initial target for the round. 388 00:20:08,160 --> 00:20:10,160 Speaker 3: For more and what the company is doing, host Paul 389 00:20:10,320 --> 00:20:13,840 Speaker 3: John Tucker and I were joined by Michael Binderbauer, CEO 390 00:20:13,960 --> 00:20:17,520 Speaker 3: of Tay technologies. We began the conversation by asking Michael 391 00:20:17,560 --> 00:20:19,959 Speaker 3: to break down exactly what fusion power is. 392 00:20:20,520 --> 00:20:23,160 Speaker 9: So it's basically what nature does, based right, It keeps 393 00:20:23,240 --> 00:20:25,600 Speaker 9: us our life and energy here on the planet from 394 00:20:25,640 --> 00:20:28,679 Speaker 9: the Sun son any star you look up suffusion reactor 395 00:20:28,720 --> 00:20:31,119 Speaker 9: basically right. So what we're trying to do is to 396 00:20:31,160 --> 00:20:36,080 Speaker 9: replicate that terristrially to make essentially copious power, carbon free, 397 00:20:36,280 --> 00:20:39,520 Speaker 9: clean and sustainable for the future of humanity. 398 00:20:40,160 --> 00:20:44,320 Speaker 2: Where are you in the process at tay So. 399 00:20:44,200 --> 00:20:47,240 Speaker 9: We're very close. We're just one machine a way to 400 00:20:47,240 --> 00:20:49,439 Speaker 9: get to a point where we actually harvest more energy 401 00:20:49,480 --> 00:20:52,040 Speaker 9: than what we're putting into the facility. This has been 402 00:20:52,400 --> 00:20:55,000 Speaker 9: obviously a long journey. It's hard to do terristrially. The 403 00:20:55,040 --> 00:20:57,080 Speaker 9: stars have a lot of gravity. We don't have that. 404 00:20:57,160 --> 00:20:59,520 Speaker 9: We have to use other means, magnets and all sorts 405 00:20:59,560 --> 00:21:02,000 Speaker 9: of things, and as you've probably seen over the last 406 00:21:02,040 --> 00:21:05,040 Speaker 9: few years, has been a playthrow of news inching really 407 00:21:05,080 --> 00:21:07,639 Speaker 9: really close to the goal line across multiple efforts on 408 00:21:07,720 --> 00:21:10,520 Speaker 9: the planet. So we're about a three year way to 409 00:21:10,520 --> 00:21:14,320 Speaker 9: get tonate energy and somewhere early twenty thirties we hopefully 410 00:21:14,359 --> 00:21:15,600 Speaker 9: have a power plant online. 411 00:21:16,840 --> 00:21:18,800 Speaker 3: What would be if you're able to achieve it and 412 00:21:18,840 --> 00:21:21,520 Speaker 3: have a power plant, Like, what is that? Is that 413 00:21:21,640 --> 00:21:24,879 Speaker 3: just tremendous amount of energy with like no footprint. 414 00:21:26,280 --> 00:21:28,800 Speaker 9: Yeah, it's very small footprint. So it's the highest energy 415 00:21:28,800 --> 00:21:31,560 Speaker 9: density fuel you can have, by the factor of five 416 00:21:31,680 --> 00:21:35,800 Speaker 9: to ten, higher than fission. Even it utilizes hydrogen or 417 00:21:36,000 --> 00:21:40,080 Speaker 9: light species that are ubiquitous. So there's infinite fuel supply 418 00:21:40,119 --> 00:21:43,080 Speaker 9: if you will, and you would harvest clean energy out 419 00:21:43,119 --> 00:21:45,679 Speaker 9: of that at probably starting in a scale of a 420 00:21:45,720 --> 00:21:48,320 Speaker 9: gas fired turbine, so something like four or five hundred 421 00:21:48,320 --> 00:21:51,520 Speaker 9: makawatts per plant, and it would literally be able to 422 00:21:51,520 --> 00:21:53,760 Speaker 9: distribute wherever you needed it in the grid. 423 00:21:54,640 --> 00:21:54,840 Speaker 11: Is there? 424 00:21:55,119 --> 00:22:00,240 Speaker 2: Can you talk about the economics surrounding this technology? Gee, 425 00:22:00,240 --> 00:22:02,840 Speaker 2: who would be the who would be the users, the buyers, 426 00:22:02,960 --> 00:22:04,480 Speaker 2: the developers of this technology? 427 00:22:05,520 --> 00:22:07,520 Speaker 9: Yeah, so I think what we're seeing and this gets 428 00:22:07,520 --> 00:22:09,800 Speaker 9: to what we just announced, you know, raising capital. We 429 00:22:09,840 --> 00:22:13,200 Speaker 9: really have a long partnership with Google and they've been 430 00:22:13,200 --> 00:22:15,760 Speaker 9: deep with us on machine learning and tools to help 431 00:22:15,800 --> 00:22:19,479 Speaker 9: make this more efficient and more economic, and in fact, 432 00:22:19,600 --> 00:22:22,280 Speaker 9: they would be a great first off taker for that, right, 433 00:22:22,400 --> 00:22:26,879 Speaker 9: all the hyperscalers, everybody that has high energy, intense applications 434 00:22:27,320 --> 00:22:30,040 Speaker 9: growing at tremendous rates right with a gap between supply 435 00:22:30,080 --> 00:22:34,399 Speaker 9: and demand. Developing is looking for electrons and particularly green electrons. 436 00:22:34,400 --> 00:22:36,639 Speaker 9: So those would be probably the first off takers for 437 00:22:36,720 --> 00:22:37,480 Speaker 9: the technology. 438 00:22:37,720 --> 00:22:40,240 Speaker 10: Oh, I got to ask, what sets you with John Tucker? 439 00:22:40,280 --> 00:22:41,119 Speaker 3: He likes his fusion? 440 00:22:41,280 --> 00:22:44,119 Speaker 10: What sets you apart from ETR in terms of the 441 00:22:44,480 --> 00:22:49,600 Speaker 10: reactor itself, the containment that's act fusion reactor or what? 442 00:22:50,760 --> 00:22:54,080 Speaker 9: Yeah, so good question. So Eater and others are working 443 00:22:54,080 --> 00:22:56,600 Speaker 9: on tokamacs, we actually are not. We're working what you 444 00:22:56,640 --> 00:22:59,960 Speaker 9: see if you have a visual and even have a 445 00:23:00,119 --> 00:23:02,800 Speaker 9: compact machine not the size of gas turbine that can 446 00:23:02,800 --> 00:23:06,080 Speaker 9: make about the same output as those other plants. It's 447 00:23:06,280 --> 00:23:09,719 Speaker 9: much more efficient to uses smaller magnets. There's various tricks 448 00:23:09,720 --> 00:23:11,800 Speaker 9: in the physics that allow you to do that, and 449 00:23:11,840 --> 00:23:15,200 Speaker 9: that brings something that's more compact, cheaper to produce, of course, 450 00:23:15,560 --> 00:23:18,639 Speaker 9: more economic to deploy, easier to maintain, etc. And you 451 00:23:18,680 --> 00:23:22,280 Speaker 9: can essentially centralize these. We think we can build those 452 00:23:22,640 --> 00:23:25,879 Speaker 9: sort of cookie cutter in the factory and deploy on site. 453 00:23:26,000 --> 00:23:27,960 Speaker 9: And the other thing I should add is that sighting 454 00:23:28,280 --> 00:23:31,640 Speaker 9: on this compared to the other nuclear cousin which is fission. Right, 455 00:23:31,760 --> 00:23:35,359 Speaker 9: It is a lot easier. There's no meltdown possibility, there's 456 00:23:35,359 --> 00:23:39,160 Speaker 9: no sort of nuclear accident of substance that people would 457 00:23:39,200 --> 00:23:41,240 Speaker 9: have to worry about. It's truly clean and benign, and 458 00:23:41,280 --> 00:23:43,399 Speaker 9: so you can deploy it where you need it in 459 00:23:43,440 --> 00:23:44,800 Speaker 9: a much more straightforward way. 460 00:23:44,920 --> 00:23:49,760 Speaker 10: And there's no use of beryllium in that reactor, no, No. 461 00:23:49,960 --> 00:23:53,280 Speaker 9: In fact, ours is using hydrogen and boron, both of 462 00:23:53,280 --> 00:23:55,439 Speaker 9: which are light and super ubiquitous. 463 00:23:55,760 --> 00:23:58,159 Speaker 10: Well deterium as the fuel, right. 464 00:23:59,080 --> 00:24:02,919 Speaker 9: So tritium is one fuel cycle that's used by some 465 00:24:03,000 --> 00:24:05,440 Speaker 9: of us in the fusion community, and we can burn 466 00:24:05,520 --> 00:24:08,800 Speaker 9: that too, but we're really focused on hydrogen and boron. Ultimately, 467 00:24:09,480 --> 00:24:11,919 Speaker 9: that turns out that only makes helium, so you have 468 00:24:11,960 --> 00:24:15,040 Speaker 9: no neutrons, you have no radioactivity to speak of. It's 469 00:24:15,200 --> 00:24:17,160 Speaker 9: just a nirvana of energy. Essentially. 470 00:24:17,200 --> 00:24:18,600 Speaker 2: You get ubiguous. 471 00:24:18,119 --> 00:24:22,440 Speaker 9: Fuel in no radioactivity or pollution in the process, totally sustainable, 472 00:24:23,000 --> 00:24:26,360 Speaker 9: and we think it will be competitive from a cost perspective. 473 00:24:26,359 --> 00:24:29,160 Speaker 9: It will be probably starting out midfield in current generation 474 00:24:29,560 --> 00:24:32,239 Speaker 9: asset costs, so you're not as cheap as you know, 475 00:24:32,320 --> 00:24:36,119 Speaker 9: gas or renewables, but you're not as expensive as fision 476 00:24:36,200 --> 00:24:38,760 Speaker 9: is today. Is somewhere in the midfield and then trending down. 477 00:24:39,200 --> 00:24:41,840 Speaker 3: Okay, let's pretend that neither of us understood what any 478 00:24:41,880 --> 00:24:43,760 Speaker 3: of you guys were talking about in terms of brilliant. 479 00:24:44,160 --> 00:24:45,800 Speaker 3: That's why we have him right. He knows a lot 480 00:24:45,840 --> 00:24:48,959 Speaker 3: about a lot of different things. Before we let you go, 481 00:24:49,160 --> 00:24:52,119 Speaker 3: just how hard is it to have gotten to where 482 00:24:52,160 --> 00:24:52,600 Speaker 3: you are? 483 00:24:52,720 --> 00:24:52,840 Speaker 2: Like? 484 00:24:52,880 --> 00:24:54,600 Speaker 3: What has been like the biggest hurdle? 485 00:24:55,600 --> 00:24:57,399 Speaker 4: Oh gosh, it's been an enormous journey. I mean, I 486 00:24:57,440 --> 00:24:57,879 Speaker 4: have aged. 487 00:24:58,160 --> 00:25:00,200 Speaker 9: I started this out at graduate school with my really 488 00:25:00,240 --> 00:25:02,960 Speaker 9: in PhD mantour and then it took us about twenty 489 00:25:02,960 --> 00:25:06,080 Speaker 9: plus years to amalgamate the technology around it. There's a 490 00:25:06,080 --> 00:25:10,040 Speaker 9: lot of esoteric, absolutely extreme things. You've got a master 491 00:25:10,200 --> 00:25:15,320 Speaker 9: power supplies, accelerator technology, diagnostics, feedback loops, you know, use 492 00:25:15,359 --> 00:25:17,000 Speaker 9: a lot of machine learning and AI, a lot of 493 00:25:17,000 --> 00:25:19,359 Speaker 9: that we developed together with Google in the last decade 494 00:25:19,480 --> 00:25:21,159 Speaker 9: that can react on the blink of an eye to 495 00:25:21,200 --> 00:25:25,240 Speaker 9: make changes in what happens inside and do that reliably 496 00:25:25,320 --> 00:25:27,960 Speaker 9: and consistently. And so those are all the technologies we 497 00:25:28,040 --> 00:25:30,119 Speaker 9: now have. So now we're putting in the last machine. 498 00:25:30,280 --> 00:25:30,880 Speaker 4: So it's been a. 499 00:25:30,800 --> 00:25:33,880 Speaker 9: Long journey and developing lots of technology to do that. 500 00:25:34,240 --> 00:25:37,000 Speaker 2: Thanks to Michael Binderbauer, CEO Take Technologies. 501 00:25:37,280 --> 00:25:38,760 Speaker 3: Coming up in the program, we're going to look at 502 00:25:38,800 --> 00:25:41,000 Speaker 3: oil and gas companies and how they're investing in low 503 00:25:41,000 --> 00:25:42,000 Speaker 3: carbon technologies. 504 00:25:42,080 --> 00:25:45,000 Speaker 2: You're listening to Bloomberg Intelligence on Bloomberg Radio, providing in 505 00:25:45,040 --> 00:25:47,439 Speaker 2: depth research and data on two thousand companies and one 506 00:25:47,560 --> 00:25:50,520 Speaker 2: hundred and thirty industries. You can access Bloomberg Intelligence via 507 00:25:50,600 --> 00:25:52,440 Speaker 2: bi go on the terminal, Umpaul. 508 00:25:52,119 --> 00:25:54,480 Speaker 3: Sweeney, an amlex deal, and this is Bloomberg. 509 00:26:01,520 --> 00:26:05,200 Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live 510 00:26:05,280 --> 00:26:08,400 Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android 511 00:26:08,400 --> 00:26:11,679 Speaker 1: Auto with the Bloomberg Business App. Listen on demand wherever 512 00:26:11,760 --> 00:26:15,640 Speaker 1: you get your podcasts, or watch us live on YouTube. 513 00:26:15,720 --> 00:26:18,200 Speaker 3: Each week we look at research from Bloomberg and EF 514 00:26:18,240 --> 00:26:20,240 Speaker 3: previously known as New Energy Finance. 515 00:26:20,520 --> 00:26:23,119 Speaker 2: They're the team at Bloomberg that tracks and analyzes the 516 00:26:23,240 --> 00:26:27,520 Speaker 2: energy transition from commodities to power, transport, industries, buildings, and 517 00:26:27,560 --> 00:26:28,600 Speaker 2: agricultural sectors. 518 00:26:28,640 --> 00:26:30,359 Speaker 3: This week we looked at oil and gas companies and 519 00:26:30,400 --> 00:26:32,480 Speaker 3: how they're investing in low carbon technologies. 520 00:26:32,560 --> 00:26:35,560 Speaker 2: For more, we were joined by David Dhugherty, BNEF, head 521 00:26:35,560 --> 00:26:37,120 Speaker 2: of Natural Resources Research. 522 00:26:37,359 --> 00:26:39,720 Speaker 3: We first asked David what US oil companies are thinking 523 00:26:39,760 --> 00:26:42,080 Speaker 3: with regards to investing in fossil fuels and more green 524 00:26:42,119 --> 00:26:43,160 Speaker 3: friendly technologies. 525 00:26:43,680 --> 00:26:46,280 Speaker 4: Yeah, economically friendly is a great choice of word versus 526 00:26:46,359 --> 00:26:51,080 Speaker 4: environmentally friendly. Two separate things sometimes, and the story's very 527 00:26:51,080 --> 00:26:53,439 Speaker 4: different if you're looking at a US major versus a 528 00:26:53,480 --> 00:26:58,359 Speaker 4: European major, and even the technology they'll invest in. In general, 529 00:26:58,440 --> 00:27:01,520 Speaker 4: the group of big oil companies talk about investing about 530 00:27:01,520 --> 00:27:05,000 Speaker 4: seven eight percent in low carbon technologies things like wind, solar, 531 00:27:05,600 --> 00:27:09,119 Speaker 4: carbon capture, renewable fuels. Yeah, and it's plateaued around there 532 00:27:09,160 --> 00:27:10,359 Speaker 4: for the last two three years. 533 00:27:10,520 --> 00:27:14,000 Speaker 3: Yeah, it's something I mean like that. But what we 534 00:27:14,080 --> 00:27:16,560 Speaker 3: learn is that the Trump administration is taking back some 535 00:27:16,680 --> 00:27:18,480 Speaker 3: of the loans and the money that a lot of 536 00:27:18,520 --> 00:27:20,840 Speaker 3: these oil companies are using for some of those projects. 537 00:27:21,200 --> 00:27:24,360 Speaker 3: Xon in particular, they have a project in Texas it's 538 00:27:24,359 --> 00:27:27,320 Speaker 3: going to use hydrogen, and that funding is poof gone. 539 00:27:27,400 --> 00:27:31,200 Speaker 4: Yeah, right, so now what happens? Now? What happens? I mean, 540 00:27:31,359 --> 00:27:32,880 Speaker 4: you know, a tax BIK would be great for somebody 541 00:27:32,880 --> 00:27:35,760 Speaker 4: like an Xcell. They could probably go ahead without it. Arguably, 542 00:27:36,400 --> 00:27:40,600 Speaker 4: the pro oil Trump administration isn't necessarily ticking the boxes 543 00:27:40,600 --> 00:27:42,640 Speaker 4: for the oil companies to the moment, we're seeing these 544 00:27:42,680 --> 00:27:46,360 Speaker 4: tax breaks, we're seeing really low prices, not necessarily all 545 00:27:46,359 --> 00:27:49,480 Speaker 4: down to policy. It's worth highlighting, but not not beautiful. 546 00:27:49,480 --> 00:27:51,520 Speaker 4: If if you're a US oil company, for example, or 547 00:27:51,560 --> 00:27:56,040 Speaker 4: with exposure to US production, particularly on shore shale for example, 548 00:27:56,080 --> 00:27:57,840 Speaker 4: it's not a great time for them. It's not the 549 00:27:57,840 --> 00:27:59,880 Speaker 4: worst time, but it's not a great time. 550 00:28:00,280 --> 00:28:02,879 Speaker 11: Are the European energy companies or are just outside of the 551 00:28:02,960 --> 00:28:05,000 Speaker 11: US energy companies, Are they stepping up and trying to 552 00:28:05,040 --> 00:28:10,600 Speaker 11: fill that void for some more environmental friendly technology because. 553 00:28:10,359 --> 00:28:11,760 Speaker 3: They got so punished. 554 00:28:11,320 --> 00:28:14,680 Speaker 4: For that just like a yep, they made some decisions. 555 00:28:14,720 --> 00:28:16,920 Speaker 4: Maybe I'm not sure they would make again. That said, 556 00:28:16,920 --> 00:28:19,520 Speaker 4: some of the biggest players are still at the European 557 00:28:19,520 --> 00:28:23,240 Speaker 4: with equinor for example, last year wind Solar made a 558 00:28:23,320 --> 00:28:26,160 Speaker 4: comeback that's really interesting. They've got really per cassular stories, 559 00:28:26,240 --> 00:28:29,880 Speaker 4: much lower returns, center of traditionals. So you're definitely seeing 560 00:28:29,880 --> 00:28:32,440 Speaker 4: a split between the US and the European majors for sure, 561 00:28:33,200 --> 00:28:35,000 Speaker 4: But the environment's completely changing for all of them. 562 00:28:35,640 --> 00:28:37,960 Speaker 3: So I hear your point, particularly in the US, like 563 00:28:37,960 --> 00:28:41,640 Speaker 3: then Exon, they can probably still push ahead in Texas 564 00:28:41,680 --> 00:28:44,120 Speaker 3: even without the loan. They might not like it, but 565 00:28:44,160 --> 00:28:46,240 Speaker 3: they can manage it. But a lot of these companies can't. 566 00:28:46,880 --> 00:28:49,160 Speaker 3: So what happens to the projects that are already underway 567 00:28:49,160 --> 00:28:53,000 Speaker 3: to deal with you know, carbon capture, director capture, decarbonization. 568 00:28:53,440 --> 00:28:55,040 Speaker 4: They go looking for more money or they stop. 569 00:28:55,320 --> 00:28:57,000 Speaker 3: Is the money there ex government? 570 00:28:58,400 --> 00:29:00,760 Speaker 4: I think so? I think so, Like this jitter is 571 00:29:00,800 --> 00:29:02,520 Speaker 4: for sure, right, this is a four year window. And 572 00:29:02,600 --> 00:29:03,880 Speaker 4: is it a four year window or is it an 573 00:29:03,920 --> 00:29:06,200 Speaker 4: eight year window? Nobody knows. Nobody's going to bet on 574 00:29:06,240 --> 00:29:10,320 Speaker 4: that or guess, but you know, for the right anything 575 00:29:10,560 --> 00:29:12,480 Speaker 4: will happen for the right price. I guess the is 576 00:29:12,520 --> 00:29:15,560 Speaker 4: the the bottom line. But it's a huge question mark 577 00:29:15,840 --> 00:29:18,200 Speaker 4: for us in the in the next four years for sure. 578 00:29:18,640 --> 00:29:20,320 Speaker 2: But if we have oil down here in the low 579 00:29:20,440 --> 00:29:24,520 Speaker 2: sixties for an extended period of time, what are the 580 00:29:24,560 --> 00:29:27,520 Speaker 2: oil companies? I mean, do they have capital to invest 581 00:29:27,680 --> 00:29:30,920 Speaker 2: back into fossil fuels or do they just give it 582 00:29:30,920 --> 00:29:31,680 Speaker 2: back to shareholder? 583 00:29:32,440 --> 00:29:34,360 Speaker 4: It's a mix. If you look at like the players 584 00:29:34,400 --> 00:29:37,040 Speaker 4: that don't have let's say a family presence, right, you 585 00:29:37,080 --> 00:29:39,960 Speaker 4: know your mom knows, I know, Chevron, Exxon. If you 586 00:29:39,960 --> 00:29:41,960 Speaker 4: think of an EOG or any of those companies that 587 00:29:42,000 --> 00:29:45,480 Speaker 4: don't have less necessarily a like a household name, they've 588 00:29:45,480 --> 00:29:48,680 Speaker 4: got a very different way of operating. At around sixty dollars, 589 00:29:48,720 --> 00:29:50,720 Speaker 4: you're getting into territory where it's going to start to 590 00:29:50,800 --> 00:29:53,560 Speaker 4: hurt a lot of the US shale players. Fifty five 591 00:29:53,640 --> 00:29:55,360 Speaker 4: is where you'll see bock and start to fall out 592 00:29:55,360 --> 00:29:58,200 Speaker 4: of profitability. That will go down, and you're about twelve 593 00:29:58,280 --> 00:30:00,160 Speaker 4: dollars below that for a break even for some something 594 00:30:00,240 --> 00:30:02,880 Speaker 4: in the permium. So there's still space to play. But 595 00:30:03,400 --> 00:30:06,440 Speaker 4: you know, the guidance we're seeing for CAPEX quarter on 596 00:30:06,520 --> 00:30:09,400 Speaker 4: quarter is down about three four percent, whereas production is 597 00:30:09,440 --> 00:30:11,880 Speaker 4: down marginally like one percent. So the impact of the 598 00:30:11,880 --> 00:30:15,200 Speaker 4: actual production will happen a lot later than the CAPEC story. 599 00:30:15,480 --> 00:30:18,000 Speaker 4: But they're starting to, you know, tighten their belt a 600 00:30:18,000 --> 00:30:19,640 Speaker 4: bit when it comes to spend, and we'll see that 601 00:30:19,680 --> 00:30:22,920 Speaker 4: in barrel terms later like more delayed. You will see 602 00:30:22,960 --> 00:30:24,240 Speaker 4: it come through. You're not seeing it yet. 603 00:30:24,400 --> 00:30:26,560 Speaker 3: I also have to wonder too, what winds up happening 604 00:30:27,080 --> 00:30:30,040 Speaker 3: with say offshore projects, so onshore is much more reactive, 605 00:30:30,520 --> 00:30:32,480 Speaker 3: but say Gulf of Mexico, a lot of production is 606 00:30:32,520 --> 00:30:35,160 Speaker 3: going to come online that investment decision was made years ago, 607 00:30:35,200 --> 00:30:36,560 Speaker 3: so you can do nothing about it. But then if 608 00:30:36,600 --> 00:30:39,400 Speaker 3: you're making decisions today with this oil price, looking at 609 00:30:39,400 --> 00:30:42,640 Speaker 3: the curve for twenty twenty seven, twenty eight, that's when 610 00:30:42,680 --> 00:30:43,880 Speaker 3: you get some question marks. 611 00:30:44,000 --> 00:30:46,480 Speaker 4: One hundred percent. Yeah, and that plus like all this 612 00:30:46,560 --> 00:30:50,040 Speaker 4: actual barrel's coming off from OPEC new projects in Guyana 613 00:30:50,040 --> 00:30:53,320 Speaker 4: for example, coming on line and ramping up short term 614 00:30:53,480 --> 00:30:56,840 Speaker 4: looks like pain. Longer term, this investment still needed. Otherwise 615 00:30:56,840 --> 00:31:01,880 Speaker 4: you get into territory of price spikes or causing short supply. 616 00:31:02,040 --> 00:31:04,520 Speaker 4: So it's a really delicate balance for the moment. 617 00:31:04,840 --> 00:31:06,880 Speaker 2: So if I were to go to the oil patch 618 00:31:06,960 --> 00:31:08,680 Speaker 2: down there in Texas, would they be happy today or 619 00:31:08,720 --> 00:31:09,240 Speaker 2: not so much? 620 00:31:09,400 --> 00:31:12,520 Speaker 4: Yeah, it's been worse, and I think we have a 621 00:31:13,280 --> 00:31:16,840 Speaker 4: habit of saying crazy times, crazy times. It's not really 622 00:31:16,840 --> 00:31:18,719 Speaker 4: that crazy at the moment. Sixty dollars if you think 623 00:31:18,760 --> 00:31:20,880 Speaker 4: about it, we had fifty five flat for about what 624 00:31:21,320 --> 00:31:24,400 Speaker 4: two years, just two three years ago, and Texas was booming. 625 00:31:24,400 --> 00:31:27,280 Speaker 4: When you're in Houston, it's flying right. So we're not 626 00:31:27,320 --> 00:31:29,440 Speaker 4: in the territory of fear just yet. And no one 627 00:31:29,480 --> 00:31:32,200 Speaker 4: makes for great headline, but data wise, we're still a 628 00:31:32,200 --> 00:31:35,560 Speaker 4: bit away from the pain, and ushal always surprises to 629 00:31:35,600 --> 00:31:37,440 Speaker 4: the upside when it comes to efficiencies and when it 630 00:31:37,480 --> 00:31:40,360 Speaker 4: comes to how resilient it is. 631 00:31:40,400 --> 00:31:42,560 Speaker 3: Right, and then to your point, the production is only 632 00:31:42,560 --> 00:31:45,360 Speaker 3: down fractionally whereas capex is down more speaks to that point. 633 00:31:45,360 --> 00:31:47,400 Speaker 3: But I feel like the difference this time is that 634 00:31:47,880 --> 00:31:50,960 Speaker 3: oil companies went into this administration super pumped. I mean 635 00:31:51,160 --> 00:31:53,080 Speaker 3: super pumped is actually an understatement. 636 00:31:53,120 --> 00:31:55,240 Speaker 4: Pumped is a great choice, yeah, exactly. 637 00:31:55,240 --> 00:31:57,400 Speaker 3: But then the reality has been so much different. It 638 00:31:57,440 --> 00:32:02,160 Speaker 3: feels like that's the differentiation versus underlying oil price and 639 00:32:02,320 --> 00:32:04,320 Speaker 3: a little confusion. I mean, what was a billion dollars 640 00:32:04,360 --> 00:32:07,280 Speaker 3: the oil industry gave to or the energy industry gave 641 00:32:07,360 --> 00:32:10,800 Speaker 3: to President Trump? And then they're like wait what, So 642 00:32:10,840 --> 00:32:13,680 Speaker 3: it feels like that's a little bit different. There is 643 00:32:13,720 --> 00:32:17,080 Speaker 3: there one form of low capture, a low carbon investment that's. 644 00:32:16,960 --> 00:32:23,360 Speaker 4: Just toast ooh. Green hydrogen csis book cards to justify 645 00:32:23,480 --> 00:32:25,680 Speaker 4: without some form of a tax break, and the knock 646 00:32:25,760 --> 00:32:28,440 Speaker 4: on impact for that's pretty pretty significant if you think 647 00:32:28,480 --> 00:32:31,400 Speaker 4: of it, and things of like e fiels or synthetic fuels, 648 00:32:31,480 --> 00:32:33,400 Speaker 4: all of that is needed to make those things down 649 00:32:33,440 --> 00:32:37,960 Speaker 4: the line. So those two kind of toast the other 650 00:32:38,000 --> 00:32:41,040 Speaker 4: ones wind Solar there could have stune in their ground 651 00:32:41,040 --> 00:32:41,360 Speaker 4: a bit. 652 00:32:41,280 --> 00:32:44,160 Speaker 2: More thanks to David dharerty bn EF, head of Natural 653 00:32:44,200 --> 00:32:45,120 Speaker 2: Resources Research. 654 00:32:45,440 --> 00:32:47,880 Speaker 3: We move next to some news from the financial sector. 655 00:32:48,200 --> 00:32:51,160 Speaker 2: This week, Wells Fargo CEO Charlie Sharp cleared the Federal 656 00:32:51,200 --> 00:32:54,400 Speaker 2: Reserve seven year old cap on assets, allowing the bank 657 00:32:54,480 --> 00:32:56,360 Speaker 2: to grow and compete larger rivals. 658 00:32:56,520 --> 00:32:56,800 Speaker 9: For more. 659 00:32:56,840 --> 00:32:58,920 Speaker 3: In this we were joined by Hannah Levet Bloomberg, senior 660 00:32:58,920 --> 00:32:59,640 Speaker 3: finance reporter. 661 00:33:00,120 --> 00:33:02,560 Speaker 2: First asked, Hannah, how Wells Fargo is now positioned for 662 00:33:02,600 --> 00:33:04,080 Speaker 2: its next stage of growth. 663 00:33:04,720 --> 00:33:07,680 Speaker 12: Yeah, so this has truly been such a long saga 664 00:33:07,720 --> 00:33:11,160 Speaker 12: for them. Like I started covering Wells Fargo more than 665 00:33:11,200 --> 00:33:15,320 Speaker 12: seven years ago, they had just gotten put under this cap. 666 00:33:15,360 --> 00:33:17,720 Speaker 12: At the time, I was still enjoying my mid twenties, 667 00:33:18,840 --> 00:33:22,840 Speaker 12: and you know, now we are no longer there. For 668 00:33:22,960 --> 00:33:26,040 Speaker 12: Charlie Sharf, this means that he can finally play offense. 669 00:33:26,120 --> 00:33:28,760 Speaker 12: He can you know, they're not capped in size to 670 00:33:28,800 --> 00:33:31,560 Speaker 12: their level at the end of twenty seventeen anymore. And 671 00:33:31,640 --> 00:33:34,640 Speaker 12: remember that's been a huge deal for them along the way. 672 00:33:34,720 --> 00:33:36,880 Speaker 12: I mean, some of the businesses that he's marked for 673 00:33:36,920 --> 00:33:41,480 Speaker 12: growth like the trading business most notably that's been constrained 674 00:33:42,080 --> 00:33:44,080 Speaker 12: because it's more balance sheet heavy and they haven't been 675 00:33:44,080 --> 00:33:46,920 Speaker 12: able to allocate that balance sheet because they're restricted. And 676 00:33:47,360 --> 00:33:50,240 Speaker 12: like just for context, JP Morgan, the biggest US bank, 677 00:33:50,280 --> 00:33:53,880 Speaker 12: has grown almost an entire Wells Fargo in terms of 678 00:33:53,880 --> 00:33:55,600 Speaker 12: assets in the time that Wells has been capped. 679 00:33:55,760 --> 00:33:59,520 Speaker 6: Wow, all right, Hanna, I you know a full discorder. 680 00:33:59,560 --> 00:34:02,720 Speaker 2: I have my account with Wells Fargo, but I'm guessing 681 00:34:02,720 --> 00:34:04,600 Speaker 2: the CEO and the management team there they want. 682 00:34:04,440 --> 00:34:06,160 Speaker 6: To do something more than that. They think they can 683 00:34:06,200 --> 00:34:08,040 Speaker 6: do a little bit bigger and better than Paul's and 684 00:34:08,080 --> 00:34:08,800 Speaker 6: needs checking account. 685 00:34:08,800 --> 00:34:11,960 Speaker 2: So what are some of the the businesses you mentioned trading? 686 00:34:12,000 --> 00:34:15,680 Speaker 2: Are there other editors where they think they can really 687 00:34:15,680 --> 00:34:17,440 Speaker 2: grow by allocating more capital there? 688 00:34:17,880 --> 00:34:22,920 Speaker 12: Yeah, absolutely, so the businesses that Charlie Sharff marked for growth, 689 00:34:23,239 --> 00:34:25,040 Speaker 12: you know in this time while he was running the firm, 690 00:34:25,080 --> 00:34:28,720 Speaker 12: but it was still under the cap where investment banking 691 00:34:28,800 --> 00:34:33,840 Speaker 12: and trading and wealth management and credit card. But virtually 692 00:34:33,840 --> 00:34:36,560 Speaker 12: every business aside from mortgage, which they've said they're shrinking. 693 00:34:36,600 --> 00:34:38,520 Speaker 12: And remember Wells Farga used to be huge and mortgage 694 00:34:38,520 --> 00:34:40,520 Speaker 12: at one point they were churning out one in every 695 00:34:40,520 --> 00:34:43,759 Speaker 12: three home loans in the country. Every business other than 696 00:34:43,760 --> 00:34:46,120 Speaker 12: that should grow now, and they have room to do that. 697 00:34:46,360 --> 00:34:50,520 Speaker 12: But I think those businesses where they've already said that 698 00:34:50,600 --> 00:34:54,760 Speaker 12: they're targeting growth, that may be where the earliest moves are. 699 00:34:55,400 --> 00:34:58,120 Speaker 12: You know, we've reported that they're working on a high 700 00:34:58,239 --> 00:35:02,480 Speaker 12: end credit card, so that could be something that people see. 701 00:35:02,600 --> 00:35:05,520 Speaker 12: But yeah, so it really just it goes across all 702 00:35:05,560 --> 00:35:07,480 Speaker 12: of those and beyond now because they don't have this 703 00:35:07,520 --> 00:35:10,879 Speaker 12: constraint anymore, so. 704 00:35:11,040 --> 00:35:13,360 Speaker 3: How quickly can they scale in the other parts of 705 00:35:13,400 --> 00:35:14,200 Speaker 3: their business. 706 00:35:14,840 --> 00:35:17,560 Speaker 12: Yeah, well, it's an interesting question, right because we've seen, 707 00:35:18,160 --> 00:35:20,520 Speaker 12: you know, the tales of banks trying to grow too 708 00:35:20,560 --> 00:35:24,520 Speaker 12: fast and then having you know, a calamitous blow up, 709 00:35:24,520 --> 00:35:27,360 Speaker 12: and so that's something that they definitely want to avoid. 710 00:35:27,360 --> 00:35:29,279 Speaker 12: And Charlie Sharff has talked about that that it's not 711 00:35:30,280 --> 00:35:33,719 Speaker 12: like an on switch day one, but it does give 712 00:35:33,760 --> 00:35:36,959 Speaker 12: them more flexibility so they can you know, the most 713 00:35:36,960 --> 00:35:40,239 Speaker 12: immediate thing is the trading business where they just have capacity, 714 00:35:41,480 --> 00:35:47,239 Speaker 12: but besides that, it's more being able to lean into 715 00:35:47,280 --> 00:35:53,760 Speaker 12: more enthusiastically those growth initiatives that they've already kind of outlined, right. 716 00:35:54,280 --> 00:35:55,360 Speaker 6: So Hannah. 717 00:35:55,440 --> 00:35:58,400 Speaker 2: They now have them regulatory capability to maybe do more, 718 00:35:58,520 --> 00:36:01,120 Speaker 2: to maybe grow a little bit more quickly. 719 00:36:01,400 --> 00:36:03,080 Speaker 6: Did they have the balance sheet to do that? Did 720 00:36:03,120 --> 00:36:04,279 Speaker 6: they have the capital to do that? 721 00:36:04,760 --> 00:36:06,680 Speaker 12: Yeah, they have a ton of excess capital, and that's 722 00:36:06,719 --> 00:36:09,840 Speaker 12: been a theme throughout. I mean even in the earliest 723 00:36:09,920 --> 00:36:13,560 Speaker 12: days of the asset cap like, they couldn't deployed that capital, 724 00:36:13,640 --> 00:36:17,920 Speaker 12: so they gave investors a bigger dividend and more buybacks 725 00:36:18,000 --> 00:36:20,000 Speaker 12: than they were expecting. It was sort of like a 726 00:36:21,320 --> 00:36:23,239 Speaker 12: you wouldn't think that would be the outcome, but it 727 00:36:23,440 --> 00:36:27,960 Speaker 12: was at the time. So they've had excess capital. And 728 00:36:28,280 --> 00:36:30,880 Speaker 12: also because the banks in general were preparing for the 729 00:36:30,880 --> 00:36:35,520 Speaker 12: possibility of tougher capital rules that have not panned out, 730 00:36:35,600 --> 00:36:37,640 Speaker 12: so they were a lot of them been hoarding capital anyway, 731 00:36:37,680 --> 00:36:38,399 Speaker 12: sitting on a bunch of. 732 00:36:38,320 --> 00:36:42,480 Speaker 3: Extra Well, we're seeing in Wall Street it's definitely a 733 00:36:42,480 --> 00:36:45,240 Speaker 3: competition for talent, particularly if you wrap in hedge funds 734 00:36:45,239 --> 00:36:48,400 Speaker 3: as well as huge asset managers are private equity. Can 735 00:36:48,440 --> 00:36:49,680 Speaker 3: Weill's Hargo play in that game. 736 00:36:50,719 --> 00:36:54,960 Speaker 12: Yeah, they already have been. I mean they hired Fernando Rivas, 737 00:36:55,040 --> 00:36:57,719 Speaker 12: who is the head of the Corporate Investment Bank there. 738 00:36:58,480 --> 00:37:02,080 Speaker 12: He was a major hire from JP Morgan, so that 739 00:37:02,239 --> 00:37:04,560 Speaker 12: that was huge for them, and you know they've made 740 00:37:04,600 --> 00:37:08,439 Speaker 12: other hires over the years. Doug Bronstein is there, another 741 00:37:08,480 --> 00:37:14,319 Speaker 12: former JPM executive and he's vice chair. They have very 742 00:37:14,360 --> 00:37:16,680 Speaker 12: summers running wealth, so they have you know, they've been 743 00:37:16,719 --> 00:37:18,920 Speaker 12: able to get talent at the highest level and then 744 00:37:19,040 --> 00:37:20,279 Speaker 12: you know even further down as well. 745 00:37:20,600 --> 00:37:23,160 Speaker 3: All Right, Thanks to Hannah Lovit, Bloomberg Senior Finance Reporter. 746 00:37:23,800 --> 00:37:28,520 Speaker 1: This is the Bloomberg Intelligence Podcast, available on Apple, Spotify, 747 00:37:28,680 --> 00:37:32,160 Speaker 1: and anywhere else you get your podcasts. Listen live each 748 00:37:32,200 --> 00:37:36,000 Speaker 1: weekday ten am to noon Eastern on Bloomberg dot com, 749 00:37:36,080 --> 00:37:39,600 Speaker 1: the iHeartRadio app, tune In, and the Bloomberg Business app. 750 00:37:40,040 --> 00:37:42,960 Speaker 1: You can also watch us live every weekday on YouTube 751 00:37:43,360 --> 00:37:45,600 Speaker 1: and always on the Bloomberg terminal.