WEBVTT - Understanding Facebook's Antitrust Case Win 0:00:00.800 --> 0:00:04.040 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside 0:00:04.040 --> 0:00:06.920 my co host Matt Miller. Every business day, we bring 0:00:06.960 --> 0:00:11.520 you interviews from CEOs, market pros, and Bloomberg experts, along 0:00:11.560 --> 0:00:15.600 with essential market moving news. Find the Bloomberg Markets Podcast 0:00:15.600 --> 0:00:18.479 on Apple Podcasts or wherever you listen to podcasts, and 0:00:18.480 --> 0:00:22.720 at Bloomberg dot com slash podcast. Jim Anderson he's the 0:00:22.760 --> 0:00:24.919 CEO of Social Flow based in New York City, and 0:00:24.960 --> 0:00:26.760 we love to talk to Jim about all things kind 0:00:26.760 --> 0:00:30.360 of social media technology, the uh, the Internet. Jim, thanks 0:00:30.360 --> 0:00:32.519 so much for joining us here. So you know, you 0:00:32.560 --> 0:00:35.800 look at Facebook. They one dismissal of the United States 0:00:35.800 --> 0:00:40.319 and the Very States monopoly lawsuits. Is Facebook? Are they 0:00:40.320 --> 0:00:43.520 in the clear? Now? I wouldn't say they're in the clear. 0:00:43.520 --> 0:00:45.559 I mean it was a pretty stunning decision. I think 0:00:45.600 --> 0:00:47.920 everybody agreed there. And just look at their sock price 0:00:47.960 --> 0:00:49.880 if you want to see how stunning it was to 0:00:50.000 --> 0:00:52.640 the market place. But you know, they are still a 0:00:52.680 --> 0:00:55.240 giant target, right, they are a monopoly. It's funny I 0:00:55.280 --> 0:00:57.200 heard you all talking about friends are in my space, 0:00:57.320 --> 0:01:00.800 you know, sarcastically jokingly. Um, you know you're not gonna 0:01:00.800 --> 0:01:03.800 go You're not gonna thank thank god, someone gets my sarcasm. 0:01:03.880 --> 0:01:07.400 You know, I think, oh yeah, I remember friends or 0:01:07.440 --> 0:01:10.160 in my space, but TikTok snaps or maybe the current 0:01:10.680 --> 0:01:13.119 analogies and what Facebook will say if they compete every 0:01:13.160 --> 0:01:16.240 day for consumer's attention, right, and they don't have a monopoly, 0:01:16.280 --> 0:01:18.760 that's obviously their position. But they are not in the 0:01:18.800 --> 0:01:21.360 clear at all, right, you know, whether it be the 0:01:21.480 --> 0:01:24.280 STC going back and trying again with a stronger case, 0:01:24.280 --> 0:01:27.119 whether it be Congress actually passing you know I anti 0:01:27.240 --> 0:01:29.440 trust law, which is is going to require a level 0:01:29.520 --> 0:01:32.120 of bipartisanship we have yet to see, or whether it's 0:01:32.160 --> 0:01:34.560 something in the EU or other jurisdictions. This was a 0:01:34.680 --> 0:01:36.880 US victory. It was a big victory for Facebook, but 0:01:36.920 --> 0:01:39.920 they are by no means out of the woods. I'm 0:01:39.959 --> 0:01:45.520 looking at a list of other companies that are worth 0:01:45.720 --> 0:01:50.400 a trillion dollars. Facebook briefly eclipsed one trillion dollars. Actually 0:01:50.400 --> 0:01:54.080 I think it's still is worth just about one trillion dollars. 0:01:54.160 --> 0:01:57.320 And the others are Microsoft, which well it's worth two 0:01:57.480 --> 0:01:59.800 we were talking about. Apple is worth more than two 0:02:00.000 --> 0:02:04.080 billion dollars. Amazon is worth almost two trillion dollars um 0:02:04.120 --> 0:02:09.000 and and Google is um one one and two thirds trillions. There, 0:02:09.040 --> 0:02:13.280 these are big companies that do stuff arguably that we 0:02:13.400 --> 0:02:18.040 all really need. They really improve the quality of our lives. 0:02:18.200 --> 0:02:22.600 And does Facebook belong on this list? Well, the stock 0:02:22.680 --> 0:02:24.760 market seems to think so. Right. Um, you know, if 0:02:24.880 --> 0:02:26.520 if you're going to be in that kind of company 0:02:26.520 --> 0:02:28.840 with two trillion dollar companies or or will say one 0:02:28.840 --> 0:02:31.320 point seven trillion dollars in the case of Google. Uh, 0:02:31.360 --> 0:02:34.160 you know, the Facebook is a consumer attention company and 0:02:34.200 --> 0:02:37.400 what they've done, arguably better than anybody else, is for 0:02:37.520 --> 0:02:40.359 two and a half billion people around the world, create 0:02:40.400 --> 0:02:43.720 a habit of them coming back every single day right there. 0:02:43.800 --> 0:02:46.600 Daily active users number is their most impressive one, and 0:02:46.639 --> 0:02:48.560 so clearly people are getting something out of that. And 0:02:48.840 --> 0:02:52.280 your points about the misinformation, the impact on elections, I mean, 0:02:52.320 --> 0:02:54.120 there's a lot of negatives that go along with that. 0:02:54.280 --> 0:02:56.720 But also remember you have the ability to connect with 0:02:56.760 --> 0:02:58.760 family and friends, say, in touch with people you haven't 0:02:58.760 --> 0:03:01.200 talked with in years. I mean, is clearly something that's 0:03:01.200 --> 0:03:04.880 bringing people back. And Facebook just as importantly has learned 0:03:04.919 --> 0:03:07.240 how to monetize that right and that they make massive 0:03:07.280 --> 0:03:09.800 sums of revenue from advertising off of that. So they 0:03:09.880 --> 0:03:12.720 built a business and a business model that goes along 0:03:12.720 --> 0:03:15.280 with that consumer attention. And I do think they belong 0:03:15.320 --> 0:03:19.520 on the list. They're obviously very different Microsoft, I will say, 0:03:19.560 --> 0:03:24.040 I use I also use Facebook almost every day. So um, 0:03:24.800 --> 0:03:28.919 in regards to the misinformation, it seems like Google has 0:03:28.960 --> 0:03:33.320 done a much better job handling this than has Facebook. 0:03:33.360 --> 0:03:36.880 And Facebook seems to go, you know, kicking and screaming 0:03:37.040 --> 0:03:41.040 into um, the land of regulation. Why don't they do 0:03:41.120 --> 0:03:43.760 a better job of getting all of the fake news 0:03:43.800 --> 0:03:47.080 and the you know, anger, hate and vitriol off of 0:03:47.120 --> 0:03:49.960 their website. Well, I'm going to debate that point with you. 0:03:50.000 --> 0:03:51.720 I'm not sure that I would agree Google does a 0:03:51.840 --> 0:03:55.360 better job with that because specifically, remember Google owns YouTube. 0:03:55.400 --> 0:03:58.800 You typically don't care about Google and misinformation about YouTube 0:03:58.800 --> 0:04:02.280 and misinformation, but Google of course owns that, and YouTube 0:04:02.400 --> 0:04:06.640 arguably has a bigger problem than than anybody with misinformation, 0:04:06.680 --> 0:04:10.120 and as the exact same types of problems that Facebook does. 0:04:10.200 --> 0:04:12.320 Which is, when you get to such a massive scale, 0:04:12.720 --> 0:04:14.760 there's only so much humans can do, there's only so 0:04:14.840 --> 0:04:19.279 much machines can do. Decisions are inconsistent at best, missing 0:04:19.400 --> 0:04:22.080 at worst, and so it is a very daunting problem. 0:04:22.120 --> 0:04:23.960 I'm not I'm not suggesting any of it should cry. 0:04:23.960 --> 0:04:26.320 It's here for one and two trillion dollar companies. They've 0:04:26.320 --> 0:04:28.520 got the resources to try to solve this, but it 0:04:28.640 --> 0:04:31.080 is a very daunting problem on a scale that nobody 0:04:31.080 --> 0:04:34.440 has ever been able to handle before. Jim, do you 0:04:34.520 --> 0:04:38.800 expect is there an appetite within Congress to maybe take 0:04:38.800 --> 0:04:43.560 a much tighter rein on big tech? There is absolutely 0:04:43.600 --> 0:04:46.120 an appetite there, But I'll give you two two things. 0:04:46.120 --> 0:04:49.040 They're one, Republicans and Democrats both very much want to 0:04:49.040 --> 0:04:51.560 go after big tech, but for very different reasons. Right, 0:04:51.600 --> 0:04:54.320 So again, how do you get those reasons to align 0:04:54.440 --> 0:04:56.240 in action? I think there'll be an impetence. But the 0:04:57.120 --> 0:04:59.280 thing that people aren't talking about is I'm not sure 0:04:59.320 --> 0:05:03.680 there's that much consumer attention and interest in anti trust. 0:05:03.760 --> 0:05:05.600 I mean, it's a snoozer of a topic, and as 0:05:05.600 --> 0:05:07.920 big as the news was yesterday for Facebook and its 0:05:07.920 --> 0:05:10.840 stock price, we track your consumer attention and we look 0:05:10.880 --> 0:05:13.800 at the different topics and then I trust interest and 0:05:13.839 --> 0:05:16.279 then the number of people clicking on stories about anti 0:05:16.360 --> 0:05:19.919 sust is microscopic compared to things about the economy and 0:05:20.279 --> 0:05:22.800 even fashion, you know, which is as a great sign 0:05:22.839 --> 0:05:25.160 for for retailers. You know, fashion and sports and those 0:05:25.240 --> 0:05:27.560 kinds of things are far far more interesting to consumers, 0:05:27.520 --> 0:05:30.560 and ultimately politicians respond to consumers. It's not at all 0:05:30.600 --> 0:05:33.720 clear to me that there's a consumer pressure on Congress 0:05:33.760 --> 0:05:36.640 to actually cause them to work in a buipartisan ways 0:05:36.680 --> 0:05:39.400 to actually follow through on their threats. All right, Always 0:05:39.440 --> 0:05:42.679 great to get your intelligence on these issues, Jim, really important, 0:05:42.680 --> 0:05:44.800 I think for us and for listeners. Jim Anderson, the 0:05:44.880 --> 0:05:49.320 CEO of Social Flow talking to us about Facebook, the 0:05:49.400 --> 0:05:52.120 big win yesterday and the value it's now worth more 0:05:52.160 --> 0:05:59.320 than one trillion dollars. This is Bloomberg. I want to 0:05:59.360 --> 0:06:02.719 get right now out straight back to Well, maybe she'll 0:06:02.760 --> 0:06:04.280 have something to say about small calf, but I think 0:06:04.320 --> 0:06:09.040 we're gonna focus more on UM fixed income and equity strategies, 0:06:09.880 --> 0:06:13.600 a bigger picture look. Janelle Woodward joins us. She is 0:06:13.680 --> 0:06:18.400 president at McKay Shields UM. They are a one hundred 0:06:18.440 --> 0:06:22.240 and fifty eight billion dollar global asset manager. Janelle, let's 0:06:22.760 --> 0:06:24.440 let's let me get your outlook on what's going on 0:06:24.480 --> 0:06:27.400 in this market. First. I keep getting this UM mental 0:06:27.440 --> 0:06:29.599 image of a roller coaster, you know, right when you 0:06:29.600 --> 0:06:31.720 get at the top and it's kind of slowing down 0:06:31.880 --> 0:06:35.599 about to crest, and um, you're at all time highs 0:06:35.600 --> 0:06:40.360 on equity indexes. People are starting to really worry about inflation. Uh. 0:06:40.720 --> 0:06:43.000 FED members are starting to say, we need to raise 0:06:43.120 --> 0:06:46.280 rates by the end of next year. I'm getting that 0:06:46.360 --> 0:06:51.640 feeling in my stomach. Do you get that as well? Uh? Well, 0:06:51.680 --> 0:06:54.080 thank you for having me, um. I think the good 0:06:54.120 --> 0:06:56.640 news is we don't have that feeling in our stomach. 0:06:56.720 --> 0:07:00.040 But I do think that we recognize that just like 0:07:00.200 --> 0:07:04.920 last year was quite unprecedented, their recoveries and as unprecedented, 0:07:05.320 --> 0:07:08.600 and anytime we go through an inflection point when it 0:07:08.760 --> 0:07:11.600 when it comes to policy, there's some digestion that needs 0:07:11.640 --> 0:07:14.320 to happen, you know. Noting the Hawker tone of the 0:07:14.400 --> 0:07:17.360 fat earlier this month, I think we left quite constructive. 0:07:17.800 --> 0:07:19.880 And I think some of the themes that we've seen 0:07:19.880 --> 0:07:22.239 across the equity markets, we've seen across the exed income 0:07:22.280 --> 0:07:24.680 credit markets as well, and credit has been really well 0:07:24.720 --> 0:07:28.600 supported going in the month. Then, so Janelle, one of 0:07:28.640 --> 0:07:31.080 the things that the market focuses on somewhat, but it 0:07:31.080 --> 0:07:33.280 seems like it's completely focusing on on the FED. Here 0:07:33.400 --> 0:07:36.280 is fiscal stimulus. We've got some a couple of different 0:07:36.320 --> 0:07:40.640 bills kind of bouncing around Washington. How important is that 0:07:40.880 --> 0:07:44.920 to your outlook for the market if at all? Yeah, 0:07:45.040 --> 0:07:48.400 it's certainly important. And I think if we look back 0:07:48.520 --> 0:07:53.960 earlier in a lot of the interpretation around fiscal policy 0:07:54.160 --> 0:07:56.880 and what it meant played a significant role in the 0:07:57.000 --> 0:07:58.920 in the rate market. You know, when we look at 0:07:58.920 --> 0:08:01.320 the infrastructure though on the table um you know, the 0:08:01.360 --> 0:08:05.440 bill itself five hundred and eight billion isn't significant per 0:08:05.600 --> 0:08:08.920 day um, but definitely isn't not in the right direction. 0:08:09.680 --> 0:08:12.040 We think it's it's a very positive development when we 0:08:12.040 --> 0:08:15.360 think about our infrastructure needs. You know, we're constructive on 0:08:15.560 --> 0:08:18.040 the compromise, but we also think that there's going to 0:08:18.120 --> 0:08:19.880 be a flow through in the fixed income markets from 0:08:19.880 --> 0:08:23.000 a structural perspective. Um, And in that context, we're really 0:08:23.160 --> 0:08:25.400 were really focused on the implications on the muni market 0:08:25.440 --> 0:08:29.880 in particular, Uh, what happens to the muni market? I mean, 0:08:30.000 --> 0:08:34.800 especially with this huge influx of cash and it's a 0:08:34.840 --> 0:08:39.240 market that's so conservative and kind of slow to make moves. 0:08:39.679 --> 0:08:43.160 What are the effects? Yeah, I think what's interesting is 0:08:43.240 --> 0:08:46.200 we look back across six income markets over the last year. 0:08:46.280 --> 0:08:48.120 Even one of the things we've noticed is really some 0:08:48.200 --> 0:08:51.080 of the structural shifts that have taken place, and one 0:08:51.120 --> 0:08:53.480 of those areas is taxical munis and we've seen a 0:08:53.600 --> 0:08:56.800 significant growth in the taxiclemuni market. And so when we 0:08:56.880 --> 0:09:00.600 put that against the infrastructure bill UM, you know, a 0:09:00.640 --> 0:09:03.360 lot of that debt will end up flowing into the 0:09:03.440 --> 0:09:05.880 municipal market and we think it creates a lot of 0:09:06.200 --> 0:09:09.240 just a really constructive opportunity for investors, both in terms 0:09:09.280 --> 0:09:13.080 of diversification UM, the ability to invest in clean water 0:09:13.160 --> 0:09:15.840 and public power and public housing, and in the potential 0:09:16.000 --> 0:09:18.800 entities UM. But at the same point, aligned with the 0:09:19.040 --> 0:09:22.880 infrastructure bill UM, you know, they're just sustainability aspects of 0:09:22.920 --> 0:09:25.640 this that we're hearing more and more about from our clients, 0:09:25.720 --> 0:09:31.040 and we think, really it is a terrific opportunity for investors. So, 0:09:31.400 --> 0:09:33.640 you know, real quickly talk to us about E s 0:09:33.720 --> 0:09:35.520 G investing. We hear a lot more about it. How 0:09:35.520 --> 0:09:38.960 do you guys factor that into your investment process? Yeah, 0:09:39.040 --> 0:09:41.400 I think it's it's critical and as we think about, 0:09:41.640 --> 0:09:43.480 you know, what we should be looking at from an 0:09:43.480 --> 0:09:48.120 analysis perspective, and what constitutes materiality. E S and G 0:09:48.360 --> 0:09:51.400 factors have become more and more part of this dialogue. 0:09:51.640 --> 0:09:55.240 You know, it's both about downside protection but also about 0:09:55.280 --> 0:09:59.599 just the direction of the businesses longer term. So we 0:09:59.679 --> 0:10:02.400 see an opportunity through this growth, as I mentioned in 0:10:02.440 --> 0:10:05.520 the tax in the taxable meeting space, but we also 0:10:05.559 --> 0:10:09.080 see it broadly across across the taxable fixed income space. 0:10:09.800 --> 0:10:12.480 Very exciting for mackay. Today we actually launch E S 0:10:12.520 --> 0:10:17.400 G B, which is a core plus UH taxable UH 0:10:17.520 --> 0:10:21.000 ets focus specifically on E S and G and and 0:10:21.000 --> 0:10:24.240 we think it's really important really to demonstrate this this 0:10:24.480 --> 0:10:29.000 value proposition to our clients within a core fixed income 0:10:29.000 --> 0:10:32.680 place where they're allocated. So we think it's going to 0:10:32.720 --> 0:10:35.760 continue to be very topical and important to investors going forward. 0:10:36.160 --> 0:10:37.760 All right, Channel, thank you so much for joining us. 0:10:37.800 --> 0:10:40.600 We really appreciate it. As always. Janelle Woodward's president of 0:10:40.800 --> 0:10:47.640 McKay Shields. Right now, let's get to something completely different. 0:10:47.880 --> 0:10:52.240 It is twenty past eleven right now in New York, 0:10:52.520 --> 0:10:56.120 twenty past five here in Jeremy. I want to get 0:10:56.120 --> 0:10:58.800 over to Scott Freeman. He's the co founder and partner 0:10:59.000 --> 0:11:03.240 at J S T Capital um talking about the latest 0:11:03.280 --> 0:11:06.400 crypto news with us giving us his outlook on the 0:11:06.480 --> 0:11:10.320 space and um, Scott, what do you think, by the way, 0:11:10.600 --> 0:11:13.280 Dallas is a good place for crypto. I mean maybe 0:11:13.280 --> 0:11:16.960 Austin is better, right, but UM, it's a place where 0:11:17.000 --> 0:11:21.440 I think there's a lot of new, uh sort of 0:11:21.480 --> 0:11:26.840 frontier kind of business going on, and I guess that's 0:11:27.120 --> 0:11:31.720 is crypto still in that stage. Scott, Yeah, I think so. 0:11:31.880 --> 0:11:35.560 I thinks always been a lot of technology accounting Austin 0:11:35.800 --> 0:11:39.560 and UM. More recently, people have been leaving California two 0:11:39.600 --> 0:11:42.319 Texas for tax reasons and I think that's just really 0:11:42.880 --> 0:11:46.280 UM making Texas, Austin, Dallas more and more viable for 0:11:46.280 --> 0:11:49.040 people in the crypto SMAs all right, Scott. So we've 0:11:49.040 --> 0:11:52.199 seen the volatility continue in let's say bitcoin, for example, 0:11:52.240 --> 0:11:54.600 it's up four point seven percent today. It bounced like 0:11:54.640 --> 0:11:57.600 it hasn't a past kind of off. That thirty thousand 0:11:57.600 --> 0:12:00.480 dollar ish level did get a little bit below. Oh here, 0:12:01.240 --> 0:12:04.240 talk to us about China. That has been a big 0:12:04.240 --> 0:12:06.640 part of the narrative recently, and it's not been good. 0:12:06.679 --> 0:12:08.199 How do you think about some of the issues coming 0:12:08.200 --> 0:12:10.440 out of China in terms of ban on mining and 0:12:10.600 --> 0:12:15.600 restriction on crypto companies and how material is that for crypto? Well, 0:12:15.600 --> 0:12:18.319 you know, I think for bitcoin it obviously caused the 0:12:19.240 --> 0:12:21.240 or a big factory and the climb he scene over 0:12:21.280 --> 0:12:24.000 the la past few weeks. Um, But you know, I 0:12:24.000 --> 0:12:25.960 think all of that has already placed into the market. 0:12:26.160 --> 0:12:30.559 I think, um, you know, crypto bitcoin is is looking 0:12:30.559 --> 0:12:32.319 good at going forward. And I think for all of 0:12:32.440 --> 0:12:34.800 us we've been in crypto for a long time. We've 0:12:34.800 --> 0:12:37.640 seen these issues pop up every few months, whether it's China, 0:12:37.720 --> 0:12:41.400 whether it's technology, whether attacking. I mean, we've been through this. 0:12:41.520 --> 0:12:43.600 Crypto is just a very very volto asset and it's 0:12:43.640 --> 0:12:47.680 just a number example of that volatility. So, um, what 0:12:47.800 --> 0:12:51.080 happens to bitcoin now? I mean when I think about 0:12:51.280 --> 0:12:55.040 price action here, I feel like if it dropped below 0:12:55.080 --> 0:12:58.200 thirty thousand, that could be problematic. But I don't know 0:12:58.240 --> 0:13:00.520 if that's just because it's a round number that I've 0:13:00.800 --> 0:13:04.680 heard people rattle off a lot um and I feel like, 0:13:05.000 --> 0:13:07.040 if it's gonna go up, it needs to go back 0:13:07.120 --> 0:13:12.640 towards fifty and change to um to show success. Is 0:13:12.679 --> 0:13:15.360 that fair? Yeah, I think that's fair. I think we 0:13:15.360 --> 0:13:17.480 would kind of put the downside closer to twenty five 0:13:17.559 --> 0:13:19.640 as supposed to thirty, just given where the price that 0:13:19.880 --> 0:13:22.959 action has been and where the activity has been. Honestly, 0:13:23.000 --> 0:13:25.319 from from January of this year, we've always thought of 0:13:25.440 --> 0:13:30.120 arrange to fifty, which has been pretty accurate generally speaking. UM, 0:13:30.160 --> 0:13:31.760 what we think there's a lot of value in some 0:13:31.800 --> 0:13:34.280 of the other coins, especially East. You know some people 0:13:34.280 --> 0:13:37.160 who are looking to get into the ecosystem. Bitcoin gets 0:13:37.200 --> 0:13:39.960 all the headlines, but it's not necessarily the best opportunity 0:13:40.000 --> 0:13:44.240 for for gonal forward. So I saw that Kathy would 0:13:44.760 --> 0:13:48.360 and ARC they filed for US bitcoin et F in 0:13:48.440 --> 0:13:51.439 partnership with twenty one shares. How important is that for 0:13:51.520 --> 0:13:55.840 the space to have a Cathy would bitcoin etif? I 0:13:55.880 --> 0:13:57.880 think it's great. I think that on top of other 0:13:57.920 --> 0:14:00.320 positive news, I cat came out of announcement thing, but 0:14:00.360 --> 0:14:04.120 they're gonna be UM offering an exchange trade bitcoin. So 0:14:04.160 --> 0:14:06.559 I think things like that are all just great and 0:14:06.600 --> 0:14:09.319 bullish for the ecosystem. Um, we're just waiting for the 0:14:09.440 --> 0:14:11.160 sec it. I actually approved one of the e g s. 0:14:11.240 --> 0:14:14.000 Think that would be great. There There are already a 0:14:14.000 --> 0:14:16.400 bunch in Canada if you want in, and there's other 0:14:16.400 --> 0:14:19.920 ways to For me, Cathy Wood seems like I thought 0:14:19.920 --> 0:14:23.040 she wanted to be on the leading edge of technology. 0:14:23.760 --> 0:14:26.800 Isn't she better positioned in the theory um or and defy? Like, 0:14:26.840 --> 0:14:30.000 what what's she doing in digital gold? Well? I think 0:14:30.040 --> 0:14:32.600 she does both, right, I'm guessing that she's looking at 0:14:32.640 --> 0:14:34.400 all the opportunities. He says, you know what, she has 0:14:34.440 --> 0:14:37.520 a good name, she's very well regarded, she's very reputable, 0:14:37.600 --> 0:14:39.520 and my guess is that she thinks this is a 0:14:39.520 --> 0:14:42.600 good opportunity, just an increase the assets she has. You know. 0:14:42.680 --> 0:14:46.000 It's it's interesting, Scott, I'm wondering. It seems like the market, Um, 0:14:46.040 --> 0:14:48.000 if you just look at the volatility around bitcoin, it's 0:14:48.040 --> 0:14:55.440 searching for additional signs of validation, maybe for crypto. Um. 0:14:55.480 --> 0:14:58.680 You know you had um, you know, you had Elon Musk, 0:14:58.800 --> 0:15:01.200 you know, buy some crypto bye bye, I'm sorry bye, 0:15:01.200 --> 0:15:03.560 by some bitcoin and allowed bitcoin to be used for 0:15:03.600 --> 0:15:06.640 purchasing of some of the vehicles. What's the next big 0:15:06.680 --> 0:15:09.720 thing that you think the market's looking for in terms 0:15:09.800 --> 0:15:13.400 of validation of cryptos? I guess maybe an asset class, 0:15:13.400 --> 0:15:16.760 a real viable asset class. Yeah. I think that there 0:15:16.760 --> 0:15:19.560 will be others that come into the ecosystem that provide 0:15:19.640 --> 0:15:22.760 access to it. UM we're working with some of those 0:15:22.760 --> 0:15:27.680 parties right now, whether they're being UM banks, brokers, private banks, 0:15:27.840 --> 0:15:31.800 people overseas. I just think you'll you'll start seeing more 0:15:31.800 --> 0:15:35.400 and more people from traditional finance offering those rails and 0:15:35.400 --> 0:15:37.640 access to the ecosystem. All right, Scott, Thanks so much. 0:15:37.680 --> 0:15:41.080 Scott Freeman, co founder and a partner of j ST Capital, 0:15:41.120 --> 0:15:44.400 giving us our seemingly daily update on all things crypto. Well, 0:15:44.440 --> 0:15:51.160 the more coming up this is Bloomburton. Some really interesting 0:15:51.200 --> 0:15:54.360 news this morning. United Airlines goes all in on premium 0:15:54.400 --> 0:15:57.760 flyers with two hundred and seventy jets and some upgrades 0:15:57.960 --> 0:16:00.440 two Boeing Max planes. It's big new is I think 0:16:00.480 --> 0:16:03.160 for both United and maybe even more so for Boeings. 0:16:03.160 --> 0:16:07.040 When we talk about the airline bizes building planes. We 0:16:07.080 --> 0:16:11.320 talked to George Ferguson. He's the aerospace analyst for Bloomberg Intelligence, 0:16:11.360 --> 0:16:14.080 and George, we gotta start with if you can disclose this, 0:16:14.520 --> 0:16:19.320 where are you today and why are you where you are? Paul, 0:16:19.400 --> 0:16:21.840 good day. So I'm in Dallas with all that great 0:16:21.840 --> 0:16:25.920 discussion about Dallas just on the on the on the radio. 0:16:26.200 --> 0:16:28.520 I guess airplanes in Dallas. That wasn't a bad thing. 0:16:28.920 --> 0:16:32.040 A lot of important airlines here right to America and Southwest. 0:16:32.440 --> 0:16:35.320 There's a conference down here in Dallas called Aero Engines America. 0:16:35.320 --> 0:16:40.120 I'll be on a panel on Thursday, talk about maintenance 0:16:40.200 --> 0:16:42.720 and you know, the useful life of an airplane and 0:16:42.760 --> 0:16:45.200 all those heavy subjects. So, George, so am, I have 0:16:45.280 --> 0:16:48.040 to understand that there's actually a real conference taking place 0:16:48.040 --> 0:16:52.080 with real people, Yes, sir, live people. I think there's 0:16:52.280 --> 0:16:54.480 how they do it in Texas. That's how they do 0:16:54.520 --> 0:16:58.360 it in Texas. If they don't hide away in corners 0:16:58.400 --> 0:17:03.240 wearing masks and keeping distance, it's Texas. Um, which is 0:17:04.000 --> 0:17:06.280 I mean, I'm not saying we should all act like that, 0:17:06.320 --> 0:17:08.280 but it's one of the things I love about Texas. 0:17:08.400 --> 0:17:12.280 I love I love the airport there. Um. Just because 0:17:12.280 --> 0:17:14.119 Solomon Brothers thought it was a bad place to be 0:17:14.640 --> 0:17:18.280 doesn't mean I agree. Um. What's the state of the 0:17:18.320 --> 0:17:21.240 airline industry then? Now, George, I mean, are we are 0:17:21.240 --> 0:17:24.159 we gonna see a Texas sized comeback or is it 0:17:24.160 --> 0:17:27.120 going to still be a while before the all important 0:17:27.160 --> 0:17:32.119 business traveler gets back on the bus. Well, apparently, United 0:17:32.160 --> 0:17:35.520 things of Texas sized comeback coming. Uh. What what we 0:17:35.640 --> 0:17:39.480 see at Bloomberg Intelligence is we've had a really nice summer, 0:17:40.240 --> 0:17:42.800 I think, a better pop and leisure demand, and we 0:17:42.960 --> 0:17:46.119 thought we were going to get we're starting to see 0:17:46.160 --> 0:17:50.520 that transition into the fall where that leisure travelers starting 0:17:50.520 --> 0:17:53.440 to say to bit, I think their employers are asking 0:17:53.520 --> 0:17:55.879 to come back to the office and their kids are 0:17:55.920 --> 0:17:58.440 going to go back to school. Um. And so we're 0:17:58.440 --> 0:18:00.040 starting to see a little bit of a law to 0:18:00.240 --> 0:18:02.720 build as we get into the fall. We think there's 0:18:02.720 --> 0:18:05.000 going to be a little bit of time before that 0:18:05.080 --> 0:18:07.120 business travel picks up again, because I think we've got 0:18:07.119 --> 0:18:10.639 to give these people back into offices and companies have 0:18:10.680 --> 0:18:12.960 to get up the curve on what travel policy is 0:18:13.440 --> 0:18:15.840 for business travel. Again, if you're going to Texas, they're 0:18:15.880 --> 0:18:18.360 open for business travel, but not everywhere in the world 0:18:18.440 --> 0:18:21.800 wants to take you for a lot of business meeting. Uh. 0:18:21.840 --> 0:18:23.399 And then so I think you'll take a time some 0:18:23.480 --> 0:18:25.920 time to sether in business. Do you think you're gonna 0:18:25.960 --> 0:18:29.760 have a rougher for queue one que? Then you get 0:18:29.760 --> 0:18:32.359 back to a leisure bounce of the next summer and 0:18:32.400 --> 0:18:34.760 we'll continue to build business as we go through the year, 0:18:35.240 --> 0:18:38.320 which will improve things too. But again I think you're 0:18:38.560 --> 0:18:39.919 set for a little bit of a well here in 0:18:39.920 --> 0:18:42.600 the winter. All right, George, again, the news of today 0:18:42.680 --> 0:18:45.879 United buying a bunch of jets from Boeing. That's really 0:18:45.920 --> 0:18:49.000 good news for Boeing. It seems to me, what do 0:18:49.080 --> 0:18:50.560 what do you make of it? Because I mean, you 0:18:50.600 --> 0:18:53.120 know United, it's obviously a huge global carrier and they're 0:18:53.119 --> 0:18:57.239 buying a lot of Max planes. Yes, so you know 0:18:57.280 --> 0:19:00.280 what what it tells me is we've been watching uh, 0:19:00.320 --> 0:19:03.000 you know, Bowing very closely because we've we've been a 0:19:03.000 --> 0:19:06.280 bit concerned about the ability to deliver airplanes at the 0:19:06.359 --> 0:19:08.639 rate they want to build in. They want to get 0:19:08.680 --> 0:19:12.680 the thirty one airplanes a month sevens. I'm talking by 0:19:12.720 --> 0:19:16.040 the beginning of and when we were looking at the 0:19:16.080 --> 0:19:18.680 customer base and the challenges. One of the big challenges 0:19:18.800 --> 0:19:21.960 is China hasn't approved the Max yet, and they're always 0:19:22.320 --> 0:19:25.399 a source of a lot of demand for airplanes. We 0:19:25.480 --> 0:19:27.520 still have a bit of a trade tiff going on 0:19:27.600 --> 0:19:30.640 there and so we don't see that clearing up right away. 0:19:30.720 --> 0:19:33.600 I think it's become a big political India not letting 0:19:33.600 --> 0:19:36.480 the Max in. We were very concerned about how Bowing 0:19:36.520 --> 0:19:38.280 was going to build those thirty one and who they 0:19:38.280 --> 0:19:40.720 were going to shift them to. It looks like the 0:19:40.760 --> 0:19:44.840 strategy of Bowing has been go back to your good customers, 0:19:45.520 --> 0:19:50.240 give them great deals, accelerate some of their existing orders, 0:19:50.320 --> 0:19:52.240 and build out the delivery sky and build out the 0:19:52.280 --> 0:19:56.760 delivery skyline for three. So if you look at the 0:19:56.800 --> 0:19:59.119 way you know United to take I think some sixty 0:19:59.160 --> 0:20:04.800 eight airplanes in three, and think if you look at 0:20:04.800 --> 0:20:09.600 what's happening now, they're building out that base delivery levels 0:20:09.640 --> 0:20:13.439 they need for two and twenty three with some of 0:20:13.480 --> 0:20:16.920 the more important US customers, And that's that's really I 0:20:16.920 --> 0:20:19.400 think they've probably got a great deal. I think they 0:20:19.440 --> 0:20:21.760 probably brought Bowing to the table to negotiate a great 0:20:21.800 --> 0:20:24.320 deal and they said we got invite Airbus as well. 0:20:24.760 --> 0:20:26.520 And then they picked up the eight three twenty one. 0:20:26.560 --> 0:20:29.760 Probably had a good price because because Bowling doesn't have 0:20:29.800 --> 0:20:31.480 a product in the line up, the matches the old 0:20:31.480 --> 0:20:34.320 seven fifty seven, uh you know specs and so that 0:20:34.440 --> 0:20:37.840 three twenty one does a seven five seven replacements for United. 0:20:38.320 --> 0:20:40.200 I like the big ones are we gonna see any more? That, 0:20:40.440 --> 0:20:44.679 you know? I like the seven. Um like a roomy 0:20:44.880 --> 0:20:47.560 a roomy ship. Are those done for? And we only 0:20:47.560 --> 0:20:50.399 got about twenty seconds left. Yeah, they are done for. 0:20:50.480 --> 0:20:52.360 The good news is their chief and if you like them, 0:20:52.760 --> 0:20:56.520 go out and put in a big exactly. I was 0:20:56.560 --> 0:20:59.480 in the market for a Max seven business jet, but 0:20:59.520 --> 0:21:04.040 maybe I'll us buying old and have it retrofitted. George. 0:21:04.080 --> 0:21:06.000 Always great to get some time with you. Thank you 0:21:06.080 --> 0:21:10.040 so much for joining us out of Dallas. George ferguson 0:21:10.280 --> 0:21:14.159 their senior are space and defense and airlines analysts at 0:21:14.200 --> 0:21:18.280 a real life conference. This is Bloomberg. Thanks for listening 0:21:18.280 --> 0:21:21.760 to the Bloomberg Markets podcast. You can subscribe and listen 0:21:21.800 --> 0:21:26.080 to interviews with Apple Podcasts or whatever podcast platform you prefer. 0:21:26.440 --> 0:21:30.440