WEBVTT - Why Bitcoin Is Having a Moment: CoinShares' Demirors 0:00:01.400 --> 0:00:04.120 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, along 0:00:04.120 --> 0:00:06.200 with my co host of Bonnie Quinn. Every business day 0:00:06.240 --> 0:00:10.320 we bring you interviews from CEO, market pros, and Bloomberg experts, 0:00:10.400 --> 0:00:13.600 along with essential market moving news. Find the Bloomberg Markets 0:00:13.600 --> 0:00:17.000 Podcast on Apple podcast or wherever you listen to podcasts, 0:00:17.000 --> 0:00:20.239 and on Bloomberg dot com. Alright, let's take a look 0:00:20.320 --> 0:00:23.520 at bitcoin for something just a little bit different. Why 0:00:23.520 --> 0:00:26.320 not let's move to the digital currency space. We're looking 0:00:26.360 --> 0:00:29.080 at thirty three eight hundred forty six today. It is 0:00:29.200 --> 0:00:32.440 down about three tenths of one after a couple of 0:00:32.680 --> 0:00:35.400 very down days in the last few days. Let's bring 0:00:35.400 --> 0:00:37.479 in somebody who knows a lot about this. Meltham the 0:00:37.600 --> 0:00:41.319 Mirrors is chief strategy officer from coin shares, Google's seven 0:00:41.400 --> 0:00:44.640 hundred fifty million dollars in the digital space. Well to 0:00:44.840 --> 0:00:48.559 thank you for joining. What do you make of the 0:00:48.600 --> 0:00:51.640 flows into the likes of bitcoin over the last few 0:00:51.720 --> 0:00:54.959 days and weeks and the amount of sort of new 0:00:55.080 --> 0:00:58.480 vehicles that have cropped up, including Anthony scaramuci Is new 0:00:58.520 --> 0:01:02.560 Bitcoin ETF. Yeah. Absolutely so great to be back on 0:01:02.600 --> 0:01:04.840 the show, and I want to make a minor correction. 0:01:05.040 --> 0:01:07.600 We actually coin shares hit a record high as three 0:01:07.600 --> 0:01:09.720 point nine billion in a u M, so it's quite 0:01:09.720 --> 0:01:11.880 a step up from the seven hundred fifty million we 0:01:11.920 --> 0:01:14.559 had about a year ago. And actually on the first 0:01:14.600 --> 0:01:16.840 trading day of the year this year, we had a 0:01:16.880 --> 0:01:19.720 new high where we saw over two hundred million dollars 0:01:19.720 --> 0:01:23.160 of our change trader products traded in one single trading 0:01:23.160 --> 0:01:26.920 session January four, big day. So I'll definitely say there's 0:01:26.959 --> 0:01:31.600 a lot of interest in crypto ETPs and crypto vehicles. 0:01:31.760 --> 0:01:35.000 Just melt him. Let's let's carify exactly that you had 0:01:35.040 --> 0:01:37.560 seven fifty million a year ago, you have what now? 0:01:37.600 --> 0:01:40.360 And has it been due to flows or due to 0:01:40.440 --> 0:01:43.040 the you know, the massive gains that we've seen in 0:01:43.080 --> 0:01:46.640 the likes of bitcoin. Absolutely, so we have three point 0:01:46.720 --> 0:01:49.680 nine billion in assets under management in our exchange traded 0:01:49.720 --> 0:01:52.560 products and that is a result of two factors, as 0:01:52.600 --> 0:01:55.760 you alluded to. One factor, obviously, is the price rise. 0:01:56.240 --> 0:01:59.480 That in addition, we've seen a tremendous amount of inflows 0:01:59.520 --> 0:02:02.680 into our et p s as well as other structured products. 0:02:03.200 --> 0:02:05.520 And again what we're seeing is a tremendous amount of 0:02:05.520 --> 0:02:09.720 participation from not just crypto native asset managers like ourselves. 0:02:10.120 --> 0:02:13.440 We are currently the second largest asset manager in the 0:02:13.520 --> 0:02:17.840 world in our industry. But we're also seeing traditional asset managers, 0:02:17.960 --> 0:02:22.080 hedge fund managers Anthony Scaramucci, one River in the UK 0:02:22.560 --> 0:02:25.919 entering into this market and in significant size. We're talking 0:02:25.960 --> 0:02:30.440 about multibillion dollar vehicles here. So new inflows combined with 0:02:30.520 --> 0:02:33.720 the price rally has resulted in a tremendous amount of 0:02:33.760 --> 0:02:37.239 market activity across the board. Talk to us about the 0:02:37.240 --> 0:02:41.280 trading that we've seen melt him in bitcoin just specifically, 0:02:41.720 --> 0:02:45.080 it's had just extraordinary rise up here. I'm just looking 0:02:45.120 --> 0:02:47.280 at it. You know, back in March, when a lot 0:02:47.280 --> 0:02:49.600 of risk assets were melting down, it was about five 0:02:49.639 --> 0:02:51.880 thousand dollars in here. We are, you know, just under 0:02:51.919 --> 0:02:55.280 thirty four thousand after peaking it over forty. Talked us 0:02:55.280 --> 0:02:57.839 about what we've seen in the price of bitcoin, maybe 0:02:57.840 --> 0:03:03.800 even the recent volatility, uh bitcoin absolutely and the trading story. 0:03:03.960 --> 0:03:06.200 You know, we have a large trading desk at our firm. 0:03:06.240 --> 0:03:09.239 We're trading about five to seven billion of notional volume 0:03:09.240 --> 0:03:13.040 every month. What we've really seen last year around this time, 0:03:13.120 --> 0:03:16.760 the majority of bitcoin trading volume was in the bitcoin 0:03:17.080 --> 0:03:20.520 teather trade pair. Teather UM, as some of your listeners 0:03:20.600 --> 0:03:24.600 might know, is a blockchain based digital dollar. So the 0:03:24.639 --> 0:03:27.960 majority of volume we saw was happening during Asia trading 0:03:28.000 --> 0:03:31.560 hours in the Bitcoin teather trading pair. Over the last 0:03:31.600 --> 0:03:34.640 twelve months and particularly in December and the start of 0:03:34.760 --> 0:03:37.600 this year, what we've seen is an uptick in volume 0:03:37.680 --> 0:03:40.440 in the Bitcoin USD pair, which is now the most 0:03:40.480 --> 0:03:44.600 dominant pair, and in addition, a lot of trading activity 0:03:44.720 --> 0:03:48.480 has shifted to US and UK market hours, So to us, 0:03:48.520 --> 0:03:51.080 that's one of the clear indications that volume is starting 0:03:51.120 --> 0:03:53.920 to shift. And then the last piece I'll add that's 0:03:53.960 --> 0:03:57.160 important to note is, as many may know, the CME 0:03:57.240 --> 0:04:00.840 in tween launched a bitcoin derivative market. They have a 0:04:00.920 --> 0:04:05.360 futures contract and an options contract. In December, the Bitcoin 0:04:05.400 --> 0:04:08.760 options contract at Semi hit an all time high of 0:04:08.880 --> 0:04:11.880 one billion in monthly x three, and we're seeing a 0:04:11.920 --> 0:04:15.440 tremendous amount of up kicking volume on that CME venue. 0:04:15.760 --> 0:04:18.719 Whereas historically in the past, the majority of options and 0:04:18.720 --> 0:04:23.440 derivatives volume had been on crypto native platforms, particularly those 0:04:23.480 --> 0:04:26.680 based in the Asia Pacific region, we're now starting to 0:04:26.680 --> 0:04:30.880 see a lot more participation in USD denominated markets tied 0:04:30.880 --> 0:04:34.560 to the legacy banking system and access by institutions through 0:04:34.600 --> 0:04:39.599 their existing scms and their existing brokerag providers. How do 0:04:39.640 --> 0:04:42.560 you take a pair build him, mild him. I mean, 0:04:43.080 --> 0:04:46.520 you know, obviously we quote bitcoin in terms of it 0:04:46.680 --> 0:04:49.520 versus the US dollar. You talk about in versus tether 0:04:49.680 --> 0:04:53.240 and others. What what are the what are the options 0:04:53.240 --> 0:04:56.560 I suppose these days? Sure, so tether is a dollar, right, 0:04:56.640 --> 0:04:58.600 Every tether is equal to a dollar. It's just that 0:04:58.680 --> 0:05:01.400 the dollar is on a on a blockchain, so it 0:05:01.480 --> 0:05:05.440 trades natively on chain. It's very similar to the concept 0:05:05.520 --> 0:05:08.560 of the central bank digital currency, except for central bank 0:05:08.640 --> 0:05:11.480 issuing it. In this instance, it's a private company issuing 0:05:11.480 --> 0:05:15.359 it with the dollars held in reserve and collateral. And really, 0:05:15.360 --> 0:05:18.320 I think the importance of the shift from tethered to 0:05:18.480 --> 0:05:21.680 us D is an indication that more of the people 0:05:21.720 --> 0:05:25.560 who are accessing capital markets in crypto are coming from 0:05:25.680 --> 0:05:28.880 a bank accounts rather than being crypto native trading firms. 0:05:29.200 --> 0:05:31.880 So I think that's really the key insight for US there. 0:05:32.440 --> 0:05:34.680 And in terms of trade pairs, you know, bitcoin is 0:05:34.720 --> 0:05:38.080 a very deep, very liquid market at this stage three 0:05:38.160 --> 0:05:41.360 years ago not so deep, not so liquids, and today 0:05:41.800 --> 0:05:44.960 it's a twenty four seven global market. UM is quoted 0:05:45.200 --> 0:05:48.600 primarily in us D, but obviously there are hundreds of 0:05:48.960 --> 0:05:51.600 trade pairs and various currencies, but the us D trade 0:05:51.640 --> 0:05:54.400 pair is really the most prominent one, and that's certainly 0:05:54.400 --> 0:05:57.960 the one we check at our firm. Extraordinary story, Milton, 0:05:58.000 --> 0:05:59.880 thank you so much for joining us. We really pre 0:06:00.200 --> 0:06:03.320 getting the update and the update on the assets under management. Uh, 0:06:03.320 --> 0:06:07.480 that is just extraordinary. Of the past twelve months. Meltem 0:06:07.560 --> 0:06:12.520 Demere's chief strategy off for Coin Shares Group just really 0:06:12.600 --> 0:06:15.320 Vanni just that the growth in and the depth of 0:06:15.360 --> 0:06:17.839 the marketplace, as Meltem was mentioned to me, that's one 0:06:17.839 --> 0:06:20.640 of the most oppressive things, the depth of the marketplace. Yeah, 0:06:20.680 --> 0:06:22.559 I mean, you know, let's not forget a bitcoin itself 0:06:22.600 --> 0:06:25.480 is up three d thirty percent over the last twelve months, 0:06:25.600 --> 0:06:28.000 so you know that accounts for for some of that. 0:06:28.120 --> 0:06:33.840 But also these are such tremendously volatile assets, Paul, you know, yeah, 0:06:33.880 --> 0:06:36.280 but as presumably as you talk to the bulls, as 0:06:36.279 --> 0:06:39.720 this market becomes deeper and broader, uh, and and perhaps 0:06:39.720 --> 0:06:42.800 more liquid with more players, that becomes a little bit 0:06:43.080 --> 0:06:47.560 more stable, we'll see, and it's time to talk markets 0:06:47.800 --> 0:06:50.640 once again. Now let's bring in Brent Shooty, chief Investment 0:06:50.640 --> 0:06:55.320 Strategies for North will Western Mutual Wealth Management brand. It's 0:06:55.360 --> 0:06:58.640 been quite a few months. It's been you know, crazy, 0:06:58.760 --> 0:07:01.760 crazy times here in United States. The markets those seem 0:07:01.800 --> 0:07:05.600 to obligely just gone higher and higher, at least equity markets, 0:07:05.720 --> 0:07:07.719 and you know, more recently we've been getting a bit 0:07:07.720 --> 0:07:10.120 of a shift in bond markets. What's that's what's the 0:07:10.160 --> 0:07:12.600 main decision that you've had to make over the last 0:07:12.640 --> 0:07:17.200 day four weeks. Well, I think your earlier comments about 0:07:17.280 --> 0:07:19.920 kind of the markets moving higher and some of the 0:07:19.960 --> 0:07:22.000 issues that are still out there, I want to point 0:07:22.040 --> 0:07:24.520 out that the markets discount more into the future, and 0:07:24.560 --> 0:07:27.000 so the markets are thinking about the end of COVID 0:07:27.040 --> 0:07:29.120 nine king hopefully and I was getting back onto public 0:07:29.320 --> 0:07:31.720 and those brighter days ahead in the future. And I 0:07:31.720 --> 0:07:33.760 think that as you invest money, as you think about 0:07:33.760 --> 0:07:38.000 those things. Um, certainly there has been some troubling data 0:07:38.000 --> 0:07:40.320 out there's been some troubling things happen which have happened 0:07:40.360 --> 0:07:42.960 in the last four weeks. But from an investment perspective, 0:07:43.000 --> 0:07:45.080 I think it's important to point out that you always 0:07:45.200 --> 0:07:47.200 need to be looking ahead, and I think the last 0:07:47.280 --> 0:07:49.160 four weeks we've had to focus on that quite a bit, 0:07:49.480 --> 0:07:52.240 making sure that we're looking ahead into hopefully the next 0:07:52.280 --> 0:07:55.800 few months when the world looks just a bit brighter 0:07:56.080 --> 0:07:58.840 and its operating on multiple centers that you're owth. So 0:07:58.920 --> 0:08:01.040 I guess, in a way to your question, the last 0:08:01.080 --> 0:08:03.840 four weeks, UM certainly looking at the data, but looking 0:08:03.880 --> 0:08:05.480 ahead more so. And that's what the market is doing 0:08:05.560 --> 0:08:07.520 right now. It's looking ahead to what happens in the future, 0:08:07.520 --> 0:08:09.640 and it's seeing a brighter one ahead, all right, So 0:08:09.680 --> 0:08:12.640 a brighter outlook ahead. Where are you going? Where are 0:08:12.640 --> 0:08:16.480 you allocating capital? Brent Well? So, I think for the 0:08:16.520 --> 0:08:19.360 last three years, technology growth stocks have been only game 0:08:19.400 --> 0:08:21.800 in town and kind of ties into my cylinders of 0:08:21.840 --> 0:08:24.880 growth commentary because I do think next year will be there. 0:08:24.920 --> 0:08:26.520 This year, I should say, now we're in the new year, 0:08:26.800 --> 0:08:29.440 um will be the first year in many actually three 0:08:29.480 --> 0:08:32.000 that we've operated both in the US and the globe 0:08:32.040 --> 0:08:34.880 on multiple cylinders of growth. And by that I mean 0:08:34.920 --> 0:08:36.880 back in two thous eighteen we were kind of introduced 0:08:36.920 --> 0:08:41.280 to the trade war that was designed to slow global growth, 0:08:41.600 --> 0:08:44.640 and it was designed to harm manufacturing and exports around 0:08:44.640 --> 0:08:47.680 the around the world, and that actually had a blowback 0:08:47.720 --> 0:08:49.680 into the US. And so if you think about it, 0:08:49.720 --> 0:08:52.520 technology was really unimpacted by that. It was the place 0:08:52.520 --> 0:08:56.320 of earnings growth. Growth was narrow and the market was narrow. 0:08:56.480 --> 0:08:59.160 Those two things were aligned as you look in the 0:08:59.840 --> 0:09:03.080 one um that hopefully will be off the boil um. 0:09:03.160 --> 0:09:05.520 So COVID, I should say, also kept that going. COVID 0:09:05.559 --> 0:09:08.160 actually in the beginning narrowed the economy narrow the market's 0:09:08.200 --> 0:09:10.240 technology was kind of the only game in town. And 0:09:10.360 --> 0:09:12.800 recently you've seen the market broaden out because the economy 0:09:12.840 --> 0:09:14.959 is brought out, and so we continue to think that's 0:09:14.960 --> 0:09:18.480 a backrop in That means that things that haven't done 0:09:18.520 --> 0:09:21.520 as well, like cyclical stocks, like value stocks, like small 0:09:21.559 --> 0:09:24.760 cap stocks which started doing better in Q four, will 0:09:24.800 --> 0:09:26.839 continue to do well into the new year. And that's 0:09:26.840 --> 0:09:29.679 where we're focusing most of our attention on. That's fascinating. 0:09:29.720 --> 0:09:32.360 So what kind of value plays are out there that 0:09:32.400 --> 0:09:35.960 you see them well from a broad perspective. I we 0:09:35.960 --> 0:09:38.920 we we use broad based et f s and mutual 0:09:38.920 --> 0:09:40.920 funds for the most part, so we are investing along 0:09:41.000 --> 0:09:43.319 the lines of just value stocks and some of those 0:09:43.320 --> 0:09:44.839 sectors that have been harmed a lot. So I think 0:09:44.840 --> 0:09:47.600 the financial stink energy UM think stocks that are just 0:09:47.720 --> 0:09:50.240 cheaper than some of the growth stocks that have been 0:09:50.880 --> 0:09:53.440 um bit up kind of because rates are low and 0:09:53.480 --> 0:09:56.080 because their story. Stocks with a compelling future. I'm not 0:09:56.080 --> 0:09:58.680 suggesting that future doesn't come to fruition. I just think 0:09:59.559 --> 0:10:00.920 a year when you kind of get back to some 0:10:00.920 --> 0:10:04.600 of the things are a bit more boring, like perhaps industrials, financials, 0:10:04.800 --> 0:10:08.480 things where UM things that have been impacted for the 0:10:08.520 --> 0:10:11.000 past few years because of some of these things that 0:10:11.040 --> 0:10:13.720 are out there that have kept global growth from hiring 0:10:13.720 --> 0:10:15.920 on all cylinders, which, as I mentioned before, I think 0:10:16.720 --> 0:10:21.120 that alleviates so Brent, I guess the you know, one 0:10:21.120 --> 0:10:23.240 of the issues for a lot of people as a 0:10:23.559 --> 0:10:27.120 think about equity markets is market cap. The big cap 0:10:27.240 --> 0:10:29.880 names you talked about have been such good stories for 0:10:29.920 --> 0:10:32.520 a long time. And as we broaden out our view, 0:10:33.120 --> 0:10:36.480 how are you viewing small cap mid cap stocks? Do 0:10:36.480 --> 0:10:41.960 you do you still see UM? Is there opportunity there? Yes, 0:10:42.160 --> 0:10:43.760 I mean I think they've certainly. I mean so in 0:10:43.800 --> 0:10:45.439 the fourth quarter small and mid cap stocks and the 0:10:45.480 --> 0:10:48.199 indextins we look at we're up twenties four and respectively. 0:10:48.679 --> 0:10:51.240 I'm not suggesting that large caps aren't a bad story. 0:10:51.280 --> 0:10:53.880 I think the SMP was up twelve. So it's not 0:10:53.960 --> 0:10:56.960 that there isn't still opportunities within some of those other segments. 0:10:57.480 --> 0:11:00.640 It's just that I think in all in mid cap 0:11:00.679 --> 0:11:03.520 stocks and value stocks to that matter, have further room 0:11:03.600 --> 0:11:06.800 to run. Look, growth versus value is at all time extremes, 0:11:06.880 --> 0:11:08.760 and I think that's been logical for the reasons that 0:11:08.800 --> 0:11:12.680 I mentioned. But as you think about think about more 0:11:12.720 --> 0:11:15.240 monetary policies that that is not going to stop. They 0:11:15.280 --> 0:11:17.880 have to have credibility in the future. They need to 0:11:17.960 --> 0:11:20.920 persent inflation. The feds QUEI is designed to make you 0:11:20.960 --> 0:11:25.400 take risk. Fiscal policymakers are not going to stop UM. 0:11:25.440 --> 0:11:28.400 You have COVID hopefully alleviating its impact on the rest 0:11:28.400 --> 0:11:31.079 of the economy. You have an inventory rebuild that has 0:11:31.120 --> 0:11:33.040 to happen, and you have some pent up demand from 0:11:33.080 --> 0:11:36.800 consumers who actually UM certainly in the aggregate, have saved money. 0:11:36.840 --> 0:11:38.880 There's still are people who are in trouble and hopefully 0:11:38.920 --> 0:11:40.840 stimulist gets them through and then they get jobs back. 0:11:41.240 --> 0:11:43.280 But you have an economy that's going to be operating 0:11:43.280 --> 0:11:46.080 on all cylinders, and to us, that means this recent 0:11:46.400 --> 0:11:51.000 rotation that we have seen continues in because earnings growth 0:11:51.040 --> 0:11:53.680 will broaden out and technology won't be the only game 0:11:53.679 --> 0:11:56.760 in town. And so UM, that's where we're kind of focused. 0:11:56.880 --> 0:11:59.480 Would you go so far then Brenda's to be short 0:11:59.600 --> 0:12:04.839 some of these growth stocks, like a test for example. Now, UM, 0:12:04.920 --> 0:12:07.360 that's not our ore. We are long term investors. We 0:12:07.360 --> 0:12:09.000 take a long term approach and a long term out, 0:12:09.080 --> 0:12:11.800 but we still own large cap stocks. Well, I suppose 0:12:11.840 --> 0:12:13.680 what I'm really asking is do you think they're going 0:12:13.720 --> 0:12:15.680 to settle off massively? You may not take a position 0:12:15.720 --> 0:12:17.600 on it given what you do you know, but but 0:12:17.800 --> 0:12:20.360 do you think they're going to sell off? No, I 0:12:20.360 --> 0:12:22.079 don't know that there's a massive sell off out there. 0:12:22.280 --> 0:12:24.040 And I think, and I've equated this in the past, 0:12:24.080 --> 0:12:26.720 to let me make a caveat, I don't think things 0:12:26.840 --> 0:12:28.440 in some of those stocks are anywhere near they were. 0:12:29.600 --> 0:12:32.439 There are earnings, there are UM stories that are there 0:12:32.480 --> 0:12:36.000 that are real versus what I think happened. I'm just 0:12:36.000 --> 0:12:39.640 suggesting that investors a UM don't lose diversification because I 0:12:39.640 --> 0:12:41.600 think right now the temptation is high to do so 0:12:42.000 --> 0:12:45.040 because they've been emboldened by the past and be nudge 0:12:45.040 --> 0:12:48.120 their portfolios UM in that direction because I think there's 0:12:48.160 --> 0:12:51.120 the opportunity to add incremental performance above and beyond UM 0:12:51.160 --> 0:12:52.839 what they would get by just taking you know, a 0:12:52.880 --> 0:12:56.200 steady hold, buy and hold kind of perspective. Hey, Brent, 0:12:56.280 --> 0:12:58.439 thanks so much for joining us again. We always appreciate 0:12:58.679 --> 0:13:02.719 your perspective. Brent Shooty, chief investment strategist for the Northwestern 0:13:02.880 --> 0:13:07.160 Mutual Wealth Management giving us his bullish call on the 0:13:07.240 --> 0:13:12.640 markets for talking about that rotation trade, allocating a little 0:13:12.640 --> 0:13:15.199 bit more to some of those UM growth I mean 0:13:15.240 --> 0:13:19.320 the value stories cyclical names, maybe small caps as well. 0:13:21.760 --> 0:13:24.280 It is time for Bloomberg Opinion. We're joined today by 0:13:24.360 --> 0:13:28.800 Jonah Sarah. He's a Bloomberg Opinion columnist joining us. Joe's 0:13:28.800 --> 0:13:32.920 out with a fascinating column today on a very important topic, 0:13:32.960 --> 0:13:37.520 and that is what liability should the social media companies 0:13:37.640 --> 0:13:42.160 like Twitter, like Facebook and others have for the content 0:13:42.240 --> 0:13:44.959 that appears on their platform. And of course that is 0:13:45.000 --> 0:13:48.720 absolutely front of in center right here. As President Trump 0:13:49.080 --> 0:13:52.240 uh has been uh temporarily at least taken off of 0:13:52.240 --> 0:13:55.240 both Facebook and Twitter for some issues as it relates 0:13:55.360 --> 0:13:58.559 to last week's uprising. Uh in the Capital Joe, thanks 0:13:58.600 --> 0:14:00.920 so much for joining us here. Love to get your 0:14:01.000 --> 0:14:07.280 thoughts here, UM about this very important topic. UM well, 0:14:07.280 --> 0:14:10.720 I've pretty brought a question. Um My, my core, my 0:14:10.840 --> 0:14:15.560 core feeling is that, um, we just should not live 0:14:15.559 --> 0:14:20.720 in a world where for Silicon Valley bros, you know 0:14:21.520 --> 0:14:26.200 Tim named Tim and Mark and and and uh Jack 0:14:26.400 --> 0:14:31.680 and and Sundar get to decide you know, who who 0:14:31.720 --> 0:14:33.480 gets to be on their platform and who doesn't get 0:14:33.520 --> 0:14:35.640 to be on their platform, or what kind of speech 0:14:35.680 --> 0:14:38.320 I should say, gets to be on their platform. So 0:14:38.720 --> 0:14:43.160 you know, there's a there's a fundamental problem there that 0:14:43.320 --> 0:14:48.720 hasn't been solved. And um, you know, Facebook has fifteen 0:14:48.760 --> 0:14:54.160 thousand content moderators and yet there's still all kinds of 0:14:54.160 --> 0:14:57.560 hate speech on there. Obviously, this uprising was was in 0:14:57.640 --> 0:15:02.280 no small part planned on Facebook, um and and Facebook 0:15:02.360 --> 0:15:04.440 is always behind the curve and trying to get these things. 0:15:04.600 --> 0:15:07.520 These things often in many cases leaves demand because they 0:15:07.520 --> 0:15:09.840 don't violate their terms of service, and we barely know 0:15:09.880 --> 0:15:15.800 what their terms of service are, so so continue No, no, no, 0:15:15.920 --> 0:15:18.240 you go, you go your turn, All right, my turn. 0:15:18.320 --> 0:15:21.680 I was going to say, what responsibility exactly does the 0:15:21.720 --> 0:15:24.480 likes of Mark Zuckerberg and his company, which is in 0:15:24.560 --> 0:15:26.720 the private sector, it's not a government company, it's a 0:15:26.760 --> 0:15:33.760 private company. How much responsibility does he and the company have? Well, 0:15:33.800 --> 0:15:35.640 do you mean from a legal standpoint or do you 0:15:35.680 --> 0:15:40.520 mean from a societal and moral standpoint? From a societal 0:15:40.520 --> 0:15:42.920 and moral standpoint first, because I imagine some of the 0:15:42.920 --> 0:15:44.920 reasons we saw these actions being taken in the last 0:15:44.920 --> 0:15:47.240 few days is actually from a legal standpoint, not from 0:15:47.240 --> 0:15:51.520 a societal standpoint. But that's you know, opinion aside. I 0:15:51.520 --> 0:15:54.160 don't I don't think that's true. You don't think I mean, 0:15:54.200 --> 0:15:57.040 the key thing is, see, they have no legal liability 0:15:57.160 --> 0:16:02.160 because of section to thirty of the nineteen Communications Now 0:16:02.280 --> 0:16:07.240 excuse me, the the Communications Decency Act of So they 0:16:07.240 --> 0:16:10.800 have no legal responsibility because they are they they have 0:16:11.160 --> 0:16:14.000 they have immunity. They're just viewed as a platform and 0:16:14.000 --> 0:16:16.200 anybody can put anything on there and the person who 0:16:16.200 --> 0:16:19.560 puts it on has the liability. Now, you know, I 0:16:20.000 --> 0:16:22.520 think this is a huge, huge problem because it doesn't 0:16:22.560 --> 0:16:25.440 give these guys any incentive to take off the incendiary 0:16:25.560 --> 0:16:30.720 kind of uh posts that, on the one hand, are 0:16:30.840 --> 0:16:35.080 been very damaging to American to our politics, and to 0:16:35.240 --> 0:16:39.560 our cultural norms. But on the other hand, they drive traffic, 0:16:39.800 --> 0:16:43.360 they make money for the companies, so the companies don't 0:16:43.400 --> 0:16:45.720 have a ton of incentive to take that stuff off. 0:16:46.440 --> 0:16:49.040 Um and, So you know, my argument really is comes 0:16:49.040 --> 0:16:51.640 down to this. You know, if you're a farmer company, 0:16:52.400 --> 0:16:54.480 one of the reasons you want your drugs to work, 0:16:54.520 --> 0:16:56.360 not the only reasons, but one of them is because 0:16:56.360 --> 0:16:59.840 if they don't, you're gonna get sued to smithereen and 0:17:00.000 --> 0:17:03.440 and and that helps keep companies in line. Um and 0:17:03.440 --> 0:17:08.080 and and if Facebook and Twitter, and Apple and Amazon 0:17:08.320 --> 0:17:14.640 all had the same um uh, the possibility of of 0:17:14.640 --> 0:17:18.480 of of lawsuits, it would I believe change the way 0:17:18.560 --> 0:17:24.360 they think and act about um about what they have online. Joe, 0:17:24.800 --> 0:17:27.560 what do you think the appetite is within Washington to 0:17:28.560 --> 0:17:32.840 eliminate Section to thirty of the Communications Act. I think 0:17:32.840 --> 0:17:36.520 it's pretty high. Actually, um all the Republicans wanted, although 0:17:36.560 --> 0:17:39.199 they wanted for a stupid reason. Um. They want it 0:17:39.240 --> 0:17:42.359 because they think of it as a way to punish 0:17:42.400 --> 0:17:45.840 the tech companies, especially Facebook and Twitter, because they claim 0:17:46.320 --> 0:17:50.640 that you know, the conservative views don't get are censored, 0:17:51.280 --> 0:17:55.840 which is bologny, which is just bologny. Um uh. But 0:17:55.840 --> 0:17:58.439 but you know, there are a lot of Democrats who 0:17:58.440 --> 0:18:00.560 have come around to this, to it too. I mean, 0:18:00.600 --> 0:18:04.480 it's not it's not a slam dunk, but um uh. 0:18:04.520 --> 0:18:07.840 There is a sense that something has to change and 0:18:07.880 --> 0:18:12.000 that you can't keep pounting on Twitter and Spacebook to 0:18:12.000 --> 0:18:14.760 to do this themselves because they just they don't have 0:18:14.840 --> 0:18:17.320 the manpower and they don't really have the They're not 0:18:17.520 --> 0:18:21.600 they don't have the willingness. So um so that's that's 0:18:21.600 --> 0:18:24.560 what the issue is. Maybe. I mean, if somebody could 0:18:24.560 --> 0:18:27.760 figure out a way to modify Section to thirty so 0:18:27.800 --> 0:18:33.159 it creates some legal liability liability, um without getting rid 0:18:33.200 --> 0:18:36.480 of it entirely, I think that would be a great solution. Well, 0:18:36.480 --> 0:18:39.400 here's one for you. Don't go ahead. I mean, it's 0:18:39.400 --> 0:18:44.800 not unlimited this immunity. It's specifically accept federal criminal liability. 0:18:44.880 --> 0:18:46.960 So what if someone gets up there and argues that, 0:18:47.040 --> 0:18:49.760 you know, across states people were planning to meet and 0:18:50.240 --> 0:18:55.919 carry out violence on members of Congress last Wednesday? Is 0:18:55.960 --> 0:19:00.600 that I mean, there's potential federal liability there they there is, 0:19:00.800 --> 0:19:04.320 absolutely that's a very very narrow slice of the stuff. 0:19:04.320 --> 0:19:07.880 That's on Twitter and Facebook. That's wrong. Um, for instance, 0:19:07.920 --> 0:19:11.240 you know you can you can put anti Semitic slurs 0:19:11.359 --> 0:19:14.879 on their kingdom. Come you can? You could until until 0:19:14.920 --> 0:19:16.840 this year, you could be a holocaust and I are 0:19:16.840 --> 0:19:19.840 on Facebook, so you know, and those things. There's there's 0:19:19.880 --> 0:19:23.560 no there's no legal liability. The amount of legal liability, 0:19:23.840 --> 0:19:27.880 you know, is very very narrow for these companies. You're right, 0:19:28.400 --> 0:19:31.880 if a crime is being planned on Facebook and Facebook 0:19:31.880 --> 0:19:34.240 don't do anything about it, that's the problem. But but 0:19:34.680 --> 0:19:39.320 as a general rule, there's no legal liability. Joe, what 0:19:39.359 --> 0:19:42.199 do you expect the response from Silicon valid to be 0:19:42.400 --> 0:19:47.280 to some of this mounting pressure for regulating speech. Well, 0:19:47.640 --> 0:19:50.359 I think they actually they're not going to be a 0:19:50.440 --> 0:19:54.320 favorite eliminating to thirty, but they if you actually there's 0:19:54.359 --> 0:19:56.520 a company called Axios, which I'm sure you've heard of, 0:19:56.560 --> 0:19:59.720 which is an online site that's very aimed at the 0:19:59.760 --> 0:20:03.639 water intend movers and shakers. Facebook advertises on that side 0:20:03.680 --> 0:20:06.840 all the time, and their advertisements always say we want 0:20:06.880 --> 0:20:10.359 to be regulated, it needs to be further regulated. What 0:20:10.400 --> 0:20:13.760 they really want is for the federal government to take 0:20:13.840 --> 0:20:18.359 this problem off their hands so that there are you know, 0:20:18.480 --> 0:20:22.359 so that it becomes a government mandate that certain certain 0:20:22.400 --> 0:20:25.600 speech has to be removed. So they don't they don't 0:20:25.640 --> 0:20:28.720 feel like, you know, there there it's on them that 0:20:28.800 --> 0:20:33.399 it's their decision. Um. So actually is the appetite is 0:20:33.480 --> 0:20:36.840 higher than it's It's higher than you might think. Joe, 0:20:36.880 --> 0:20:39.000 it's a great column. There's so much nuance in here, 0:20:39.080 --> 0:20:42.080 and I urge everybody to rush out there and read 0:20:42.200 --> 0:20:45.119 Jona Sarah's column today in bloom Reig Opinion. He is, 0:20:45.160 --> 0:20:48.280 of course that the Jonah Sarah, but he's also a 0:20:48.320 --> 0:20:51.199 bloom Big opinion columnists these days. Under today's column is 0:20:51.359 --> 0:20:54.639 revoke social media's shield. But for the right reasons to 0:20:54.760 --> 0:20:57.240 their Facebook and other platforms won't get serious about cleaning 0:20:57.320 --> 0:21:01.119 up content until they face liability. It makes a great point, 0:21:01.200 --> 0:21:04.360 Paul about how you know it's only now twelve days 0:21:04.400 --> 0:21:07.000 before the end of the Tom presidency that you know 0:21:07.200 --> 0:21:09.720 Twitter and Facebook are actually booting him off. You know, 0:21:09.760 --> 0:21:12.359 it does seem the timing is not lost on a 0:21:12.359 --> 0:21:14.399 lot of people. Yeah, yeah, it could definitely be a 0:21:14.440 --> 0:21:18.320 little bit cynical about it. All right, it is time 0:21:18.320 --> 0:21:21.680 to have a conversation about the climate. And you can 0:21:21.760 --> 0:21:24.439 be absolutely sure that under John Kerry. Assuming that he 0:21:24.600 --> 0:21:26.560 is the next climates are and that that all goes 0:21:26.560 --> 0:21:29.320 ahead without any problems, we will have a very different 0:21:29.359 --> 0:21:32.480 approach in this country to climate. Remy really was one 0:21:32.560 --> 0:21:35.760 of the negotiators for the Paris Climate Agreement and he 0:21:35.840 --> 0:21:40.160 joins us now. Remy, first of all, what's your anticipation 0:21:40.480 --> 0:21:43.600 for when John carry takes office and how it will 0:21:43.640 --> 0:21:50.520 manifest itself. It's a new post hivony hipole Yes from France. 0:21:50.880 --> 0:21:53.680 Pleasure to be to be with you and to see 0:21:54.520 --> 0:21:59.800