WEBVTT - Bloomberg Businessweek Weekend - August 23rd, 2024 0:00:01.360 --> 0:00:05.760 This is Bloomberg business Week Inside from the reporters and 0:00:05.920 --> 0:00:09.479 editors who bring you America's most trusted business magazine, plus 0:00:09.560 --> 0:00:13.640 global business finance and tech news. The Bloomberg Business Week 0:00:13.720 --> 0:00:18.880 Podcast with Carol Messer and Tim Stenebeck from Bloomberg Radio. 0:00:19.640 --> 0:00:22.480 Hi, everyone, Welcome to the Bloomberg Business Week Weekend Podcast. 0:00:22.920 --> 0:00:26.680 This past week, politics Powell, and a pulse on the consumer. 0:00:27.160 --> 0:00:29.319 As we often do, we have our own takes on 0:00:29.400 --> 0:00:32.040 it all, plus a story on luminous lows and the 0:00:32.120 --> 0:00:35.239 rise of bathroom selfies that to come a bit later on. 0:00:35.640 --> 0:00:38.640 Coming up this hour, climate change, which popped up a 0:00:38.680 --> 0:00:40.880 little bit along the campaign trail and at the DNC 0:00:41.159 --> 0:00:44.800 the Democratic National Convention this past week. And while many 0:00:44.840 --> 0:00:48.040 talk about the role of evs in combating climate change, 0:00:48.159 --> 0:00:51.560 how about reving up on e revs plus checking out 0:00:51.560 --> 0:00:54.720 how we are all doing courtesy of a shopping basketful 0:00:54.760 --> 0:00:58.040 of retailer news, and from a member of the Bloomberg 0:00:58.080 --> 0:01:02.080 Business Week team, his personal with a freak diagnosis that 0:01:02.200 --> 0:01:04.959 led him on a trail to a better way. All 0:01:05.000 --> 0:01:08.000 of that to come. We begin with the DNC, which 0:01:08.040 --> 0:01:11.400 wrapped up this week with Vice President Kamala Harris officially 0:01:11.440 --> 0:01:15.320 accepting the Democratic nomination for president. Climate change came up 0:01:15.319 --> 0:01:18.040 a little bit among the many speakers, and while electric 0:01:18.120 --> 0:01:21.000 vehicles have long been considered as playing a big role 0:01:21.080 --> 0:01:23.759 on the path to a greener future, this past week 0:01:23.959 --> 0:01:27.520 Ford announced a further scaling back of its EV ambitions 0:01:27.720 --> 0:01:30.400 as it scrapped an all electric three to ROZW SUV, 0:01:30.840 --> 0:01:33.440 possibly costing the automaker as much as one point nine 0:01:33.480 --> 0:01:36.880 billion dollars in the process. Ford also postponed a next 0:01:36.920 --> 0:01:40.600 generation electric pickup and reduced spending on evs to thirty 0:01:40.600 --> 0:01:44.640 percent of CAPEX, down from about forty percent previously. However, 0:01:44.920 --> 0:01:48.120 Ford's CEO, Jim Farley, is particularly high on a type 0:01:48.120 --> 0:01:51.960 of hybrid it's called extended range Electric vehicles are erevs 0:01:52.160 --> 0:01:55.200 that have taken off in China. These are evs that 0:01:55.320 --> 0:01:58.120 also have a small internal combustion engine on board whose 0:01:58.320 --> 0:02:01.480 sole purpose is to automatic recharge the battery, and that 0:02:01.520 --> 0:02:03.680 gives them a whole lot of range. We're talking about 0:02:03.880 --> 0:02:06.800 more than six hundred miles on one charge compared with 0:02:06.840 --> 0:02:10.200 the typical three hundred sounds great, right and while Forge 0:02:10.280 --> 0:02:12.640 Jim Farley is keen on them right now. If you 0:02:12.720 --> 0:02:15.200 live in the United States, you can get them to 0:02:15.280 --> 0:02:17.839 understand why. My co host Tim Steneveek and I caught 0:02:17.880 --> 0:02:20.400 up with Keith Naughton, Bloomberg News Auto reporter. 0:02:20.760 --> 0:02:23.280 You know, a traditional hybrid, like the Toyota Prius that's 0:02:23.280 --> 0:02:26.600 been around for over twenty five years. It's primarily run 0:02:26.639 --> 0:02:29.760 by the internal combustion engine. That's what turns the wheels, 0:02:30.200 --> 0:02:35.520 and then the car's electrical system and breaking Kinnecticut. Energy 0:02:35.560 --> 0:02:39.400 from breaking recharges the battery that's also in a hybrid 0:02:39.520 --> 0:02:43.480 that supplements the internal combustion engine. But the driver in 0:02:43.520 --> 0:02:48.000 a traditional hybrid is still the internal combustion engine and 0:02:48.080 --> 0:02:51.639 the battery is sort of the backup. These extended range 0:02:51.960 --> 0:02:56.840 electric vehicles e rugs as they're known, kind of flipped 0:02:56.960 --> 0:03:02.320 the script on that they are primarily driven by the battery. 0:03:02.639 --> 0:03:06.519 They run on electricity about ninety five percent of the time. 0:03:06.840 --> 0:03:07.880 However, there is. 0:03:07.800 --> 0:03:11.160 A small internal combustion engine on board that is not 0:03:11.240 --> 0:03:15.239 connected to the wheels. It's only connected to the battery 0:03:15.960 --> 0:03:18.840 and it recharges the battery. So if you're driving on 0:03:18.880 --> 0:03:21.679 a long trip, you know, three hundred miles or more, 0:03:21.720 --> 0:03:25.360 you're going on your vacation, and you know the battery 0:03:25.400 --> 0:03:29.680 is running down, the internal combustion engine automatically clicks on 0:03:29.760 --> 0:03:31.959 and recharges the battery. You don't have to do anything, 0:03:32.800 --> 0:03:35.400 and you also don't have to stop at a roadside 0:03:35.480 --> 0:03:37.800 charging station and sit there for a half hour or 0:03:37.800 --> 0:03:42.080 more while it charges. So it extends your range, I 0:03:42.120 --> 0:03:44.240 mean up to seven hundred miles. 0:03:44.360 --> 0:03:47.840 This sounds like Okay, Holy Grail found this sounds brilliant, 0:03:48.080 --> 0:03:48.520 is it not. 0:03:49.280 --> 0:03:53.040 It is a very smart solution, and it especially addresses 0:03:53.120 --> 0:03:57.680 the things that have become roadblocks for pure electric vehicles. 0:03:58.200 --> 0:03:59.200 Range anxiety. 0:03:59.240 --> 0:04:01.640 We've all heard about range anxiety, right, that's a big 0:04:01.680 --> 0:04:04.080 issue in America. It's a big country with not all 0:04:04.080 --> 0:04:08.560 how to charging stations yet and price because these e 0:04:08.760 --> 0:04:11.720 revs don't require as big a battery because you have 0:04:11.840 --> 0:04:15.120 that internal combustion engine backup, so the battery is about 0:04:15.160 --> 0:04:18.160 half the size. Well, that lops four thousand dollars off 0:04:18.160 --> 0:04:20.480 the price of the car compared to a pure ev OK. 0:04:23.480 --> 0:04:25.960 Brilliant, brilliant, brilliant. Yeah, you might be excited about it, 0:04:25.960 --> 0:04:28.719 but I know some folks who aren't. The Sierra Club, 0:04:28.839 --> 0:04:30.920 for example, as you point out in your. 0:04:30.839 --> 0:04:32.719 Piece, so not so great for the environment. 0:04:32.880 --> 0:04:34.599 They're saying it doesn't go far enough. 0:04:35.040 --> 0:04:38.600 They want they want zero emission vehicles. They don't consider 0:04:38.640 --> 0:04:42.840 the Toyota Prius a green vehicle anymore. They believe that 0:04:42.880 --> 0:04:46.799 if you're not zero emission, you're not helping to solve 0:04:46.839 --> 0:04:47.520 climate change. 0:04:47.560 --> 0:04:49.320 Toyota, by the way, has a very different point of 0:04:49.400 --> 0:04:49.840 view on that. 0:04:50.800 --> 0:04:53.440 And you know, when you think about what goes on 0:04:53.520 --> 0:04:57.719 with these vehicles, they are mostly running in electric power. 0:04:57.839 --> 0:05:01.920 That means they actually emit fewer you know, global warming 0:05:01.960 --> 0:05:04.880 gases carbon dioxide than a Prius does. 0:05:05.400 --> 0:05:07.400 So you know it is no. 0:05:07.360 --> 0:05:10.279 It is not a pure ev not a zero emission vehicle, 0:05:10.320 --> 0:05:12.159 and that is the issue in Sierra Club has. 0:05:12.680 --> 0:05:15.280 But it goes a lot farther than traditional hybrids do. 0:05:15.400 --> 0:05:19.440 Right now, what is what are the emissions on the 0:05:19.680 --> 0:05:21.840 what are they called erevs, e reps? What are the 0:05:21.880 --> 0:05:22.719 emissions on them? 0:05:22.880 --> 0:05:26.440 Keith, Well, Carol, it kind of depends on how often 0:05:27.160 --> 0:05:30.640 that internal combustion engine goes on. How often you take 0:05:30.680 --> 0:05:33.960 a long enough trip to nearly drain the battery and 0:05:34.000 --> 0:05:35.240 the engine has to kick on. 0:05:35.760 --> 0:05:37.000 So that's pretty rare. 0:05:37.160 --> 0:05:41.640 I mean, what automakers tell us is, you know, the 0:05:41.800 --> 0:05:48.599 average you know, daily commute for Americans is under sixty miles. 0:05:49.040 --> 0:05:51.640 So you know, when you have a seven hundred mile 0:05:51.800 --> 0:05:54.039 range on your car, you're not going to get to 0:05:54.120 --> 0:05:57.960 that internal combustion engine need until deep into that range. 0:05:58.080 --> 0:06:01.920 So you know this, Jim Farley, the CEO of Bard 0:06:01.960 --> 0:06:07.920 Motor Companies, these cars are running on nine electricity, so yeah, 0:06:07.960 --> 0:06:10.719 you know that's far fewer commissions than you would get 0:06:10.960 --> 0:06:11.680 from a hundred. 0:06:11.760 --> 0:06:14.799 Hey, Keith, help me know what I'm doing right now 0:06:14.920 --> 0:06:16.640 better than what you are doing him right now? 0:06:16.839 --> 0:06:17.640 What my super real? 0:06:17.760 --> 0:06:17.960 Sure? 0:06:18.279 --> 0:06:20.880 Just saying same with me? Go ahead. 0:06:20.960 --> 0:06:23.280 Still got nowhere to charge in New York City, like 0:06:23.360 --> 0:06:24.240 you know, parking. 0:06:24.000 --> 0:06:24.480 On the streets. 0:06:24.560 --> 0:06:26.799 But that's it's a little bit of a niche issue 0:06:26.800 --> 0:06:28.599 that only affects New Yorkers, and New Yorkers normally have 0:06:28.600 --> 0:06:29.520 cars anyway. 0:06:30.200 --> 0:06:32.719 Addresses that, I know you have a question, but that 0:06:32.760 --> 0:06:36.280 would address that the city dwellers, the apartment dwellers who 0:06:36.320 --> 0:06:40.760 don't have a garage charger overnight, you know, they they 0:06:40.800 --> 0:06:42.800 don't have to be plugged in every night. 0:06:43.040 --> 0:06:43.440 I love it. 0:06:43.480 --> 0:06:45.760 Cars go for a very long distance. 0:06:45.480 --> 0:06:47.919 Before I ask you how I get one, which is 0:06:47.920 --> 0:06:53.200 a long answer because it involves many years moving. I'm 0:06:53.240 --> 0:06:57.560 curious about efficiency, and you know, when that gas motor 0:06:57.760 --> 0:07:01.240 does kick on to charge the battery. We think of 0:07:02.400 --> 0:07:05.560 efficiency when it comes to internal combustion engines. Here is 0:07:05.720 --> 0:07:09.320 miles per gallon. How many miles per gallon in battery 0:07:09.360 --> 0:07:13.480 life do you get when that gas engine kicks on 0:07:13.680 --> 0:07:14.600 to charge the battery. 0:07:16.000 --> 0:07:17.960 Yeah, I don't know the answer to that question, Tim, 0:07:17.960 --> 0:07:22.720 it's a good one, but again it's it depends on 0:07:23.240 --> 0:07:26.200 getting to that point where you need the gas engine 0:07:26.200 --> 0:07:27.520 to click on. 0:07:27.560 --> 0:07:30.120 I talked to one person for the story who was 0:07:30.160 --> 0:07:30.640 over in. 0:07:30.600 --> 0:07:33.640 China and wrote around with a friend who had an era, 0:07:34.440 --> 0:07:36.960 you know, for the entire time he was there, and 0:07:37.760 --> 0:07:40.080 they drove all over the place and the gas engine 0:07:40.080 --> 0:07:40.680 never came out. 0:07:40.720 --> 0:07:41.280 It's amazing. 0:07:42.200 --> 0:07:43.040 I think that's pretty cool. 0:07:43.080 --> 0:07:45.840 All right, So here's the question, Carol, hurry, because I 0:07:45.840 --> 0:07:48.000 got another one. How do you get one? You got 0:07:48.000 --> 0:07:49.520 to go to China for now, right. 0:07:50.240 --> 0:07:51.760 A moved to China. 0:07:51.800 --> 0:07:57.400 But but they are coming. The first one will arrive 0:07:57.920 --> 0:08:00.560 in the US next year is Stilantis, you know, the 0:08:00.600 --> 0:08:05.160 Chrysler parent company that also makes Jeep and Ram pickup trucks. 0:08:05.720 --> 0:08:09.040 As an E rev version of its Ram fifteen hundred 0:08:09.120 --> 0:08:11.040 pickup truck. They're going to call it the Ram Trucks. 0:08:11.080 --> 0:08:15.840 It is such a picker truck kind of exactly, no 0:08:15.880 --> 0:08:18.200 problem there, anyway, go ahead, good with the car seats 0:08:18.200 --> 0:08:21.040 to do for the kids. 0:08:20.760 --> 0:08:25.040 So Stilantis says, the RAM charger will have a driving 0:08:25.160 --> 0:08:28.520 range of six hundred and ninety miles, And they say 0:08:29.120 --> 0:08:33.800 it's being built in their words, to pull in an 0:08:33.960 --> 0:08:38.800 entire skeptical demographic into the electric age, because this seems 0:08:38.840 --> 0:08:43.400 to be the answer to mainstream buyers concerns about electric vehicles. 0:08:43.640 --> 0:08:46.040 You know what I love in your story. You say 0:08:46.040 --> 0:08:48.880 America's seat of the market for E revs to the Chinese, 0:08:48.880 --> 0:08:50.960 just as it did a decade ago with battery technology, 0:08:50.960 --> 0:08:54.720 which China now dominates. I just think about the mistakes 0:08:54.760 --> 0:08:57.480 that maybe we make as a country right in terms 0:08:57.480 --> 0:08:59.920 of thinking about the technology that we need to be 0:09:00.080 --> 0:09:03.560 focusing on. And I do wonder ken the US. Will 0:09:03.600 --> 0:09:06.520 the US catch up? Is this the way really forward? 0:09:07.520 --> 0:09:08.679 It's an excellent point. Carol. 0:09:09.080 --> 0:09:14.120 General Motors actually pioneered E revs fifteen years ago. 0:09:14.320 --> 0:09:15.640 With the Chevy Volt. 0:09:15.720 --> 0:09:17.240 I don't know if you remember this car, but it 0:09:17.280 --> 0:09:21.760 was a small sedan that ran primarily on battery power 0:09:21.800 --> 0:09:25.840 and had an onboard internal combustion engine to recharge the battery. 0:09:26.240 --> 0:09:28.880 They did that, it didn't sell that well. It was 0:09:29.400 --> 0:09:31.960 expensive to make, so they lost money on every car 0:09:32.040 --> 0:09:34.560 they sold, and they eventually pulled the plug in twenty 0:09:34.640 --> 0:09:37.679 nineteen as they were moving away from hybrid like vehicles 0:09:37.679 --> 0:09:40.840 and going to pure eves. GM's now bringing back plug 0:09:40.840 --> 0:09:44.200 in hybrids in twenty twenty seven, but they won't commit 0:09:44.600 --> 0:09:47.080 yet the same it's going to be an e rev 0:09:48.400 --> 0:09:51.720 so far only stillanthus even though Jim Farley, as I said, 0:09:51.720 --> 0:09:55.160 expressed all sorts of enthusiasm for e revs he has 0:09:55.200 --> 0:09:57.440 in a couple of different forms since he came back 0:09:57.440 --> 0:10:00.640 from a visit to China in the spring Ford doesn't 0:10:00.679 --> 0:10:01.240 have one. 0:10:01.800 --> 0:10:04.719 That they say is coming yet. Some of this could 0:10:04.760 --> 0:10:06.079 be related to regulation. 0:10:06.280 --> 0:10:10.200 It's not clear yet how the US regulators will treat it. 0:10:10.200 --> 0:10:13.080 It probably won't get the same kind of benefits that 0:10:13.120 --> 0:10:16.040 a pure electric vehicle will, you know, the seventy five hundred. 0:10:15.800 --> 0:10:17.360 Dollars tax credit and so forth. 0:10:17.559 --> 0:10:21.079 Yeah, so there's a little reluctance from US automakers to 0:10:21.800 --> 0:10:22.720 feel these things. 0:10:22.880 --> 0:10:25.000 Yeah, I do wonder though, something like this how it 0:10:25.080 --> 0:10:27.400 might move people to actually say, oh, I can get that. 0:10:27.400 --> 0:10:30.560 That makes more sense to me. Having said that, you 0:10:30.679 --> 0:10:34.000 understand this industry so well and the cycles and the 0:10:34.080 --> 0:10:36.719 challenges and the move that we've seen over the last 0:10:36.760 --> 0:10:39.200 few years into evs in a big way. Do you 0:10:39.240 --> 0:10:42.600 think this is what we will ultimately see all of 0:10:42.640 --> 0:10:46.200 the big American automakers focusing on. And maybe it takes 0:10:46.240 --> 0:10:48.800 a year or two, but this is maybe the root forward. 0:10:50.280 --> 0:10:53.000 It does seem like an ideal solution for America, where 0:10:53.040 --> 0:10:57.400 we have the most range, anxiety and these things. This 0:10:57.480 --> 0:11:00.600 technology works the best on the vehicles we love as 0:11:00.640 --> 0:11:03.199 shoe these and pickup trucks. It lowers their weight to 0:11:03.320 --> 0:11:07.120 extend their range. It just seems like a technology that 0:11:07.160 --> 0:11:11.680 would actually have a consumer pull instead of a regulatory push, 0:11:12.080 --> 0:11:14.800 which is what we've seen with so much green technology. 0:11:15.200 --> 0:11:18.679 Everyone I've spoken to about this technology are they're like, you, guys, 0:11:18.960 --> 0:11:21.760 how can I get one? You know, people are telling 0:11:21.800 --> 0:11:25.199 me about the story that yes, they've read about them, 0:11:25.200 --> 0:11:26.800 and they want to know where they can find one. 0:11:26.880 --> 0:11:30.840 So it just Jim probably calls it an in between solution, 0:11:31.200 --> 0:11:31.679 and it is. 0:11:31.720 --> 0:11:33.680 Maybe it's the bridge to the electric future. 0:11:33.800 --> 0:11:36.720 Whatever, But it seems like something that would resolve a 0:11:36.720 --> 0:11:39.520 lot of the issues that people have with electric vehicles 0:11:39.720 --> 0:11:41.360 but still get them to drive one and. 0:11:41.320 --> 0:11:43.640 Better than a hybrid in terms of impact on the environment. 0:11:43.720 --> 0:11:46.000 Yeah, So, Keith, if okay, we could get the RAM 0:11:46.080 --> 0:11:49.079 next year, potentially, when's Jim Farley at Ford going to 0:11:49.160 --> 0:11:51.640 have something out for us or is there a chance 0:11:51.679 --> 0:11:53.880 that we could get some of these Chinese vehicles in 0:11:53.920 --> 0:11:55.920 the US anytime soon? 0:11:55.960 --> 0:11:59.240 I think have you read headlines lately seen on an election. 0:11:59.559 --> 0:12:02.040 Also Keith's story and at the end he talks about this. 0:12:02.760 --> 0:12:03.000 Yeah. 0:12:03.240 --> 0:12:06.160 Yeah, so President Biden wants to put one hundred percent 0:12:06.280 --> 0:12:11.760 tariffs on Chinese evs, right, and i'm Chinese cars in general, 0:12:11.880 --> 0:12:15.840 and Donald Trump wants to be even tougher. So getting 0:12:15.920 --> 0:12:18.640 the Lee Auto L six or L nine that I 0:12:18.880 --> 0:12:20.880 that I cite in the story and have pictures of 0:12:20.960 --> 0:12:23.280 which do wonderful things beyond just having. 0:12:23.120 --> 0:12:24.000 This great range. 0:12:24.520 --> 0:12:28.080 Getting them here anytime soon not likely. So it's really 0:12:28.160 --> 0:12:30.840 up to the automakers in the United States. Not just 0:12:30.920 --> 0:12:33.319 the US automakers because that would just be g important 0:12:33.360 --> 0:12:35.920 testa right, but the automakers who operate in the United 0:12:35.960 --> 0:12:38.240 States to a Nissan, the Germans, you. 0:12:38.200 --> 0:12:38.760 Know all of them. 0:12:38.800 --> 0:12:40.800 And by the way, BMW had one too, called the 0:12:40.840 --> 0:12:44.080 I three that then they've stopped making. 0:12:44.120 --> 0:12:46.640 So they know how to do it. They just have 0:12:46.760 --> 0:12:48.280 to come back into the market with. 0:12:48.800 --> 0:12:51.200 All right, everybody for your barbecue this week in our 0:12:51.240 --> 0:12:53.640 next cocktail party, talk about e revs and read this 0:12:54.360 --> 0:12:55.280 unbelievable stuff. 0:12:55.320 --> 0:12:56.400 I love it, very cool. 0:12:56.440 --> 0:12:59.079 This to me sounds like answer all see you're buying 0:12:59.080 --> 0:13:01.640 that ram not and thank you so much. Bloomberg News 0:13:01.640 --> 0:13:03.800 Auto reporter Jenning us there into trick. 0:13:05.160 --> 0:13:08.679 You're listening to the Bloomberg Business Week podcast. Catch us 0:13:08.720 --> 0:13:11.959 live weekday afternoons from two to five pm. Easter Listen 0:13:12.000 --> 0:13:14.160 on Apple card Play and then Bright Auto with a 0:13:14.200 --> 0:13:18.479 Bloomberg Business app, or watch us live on YouTube. 0:13:18.559 --> 0:13:20.800 We got a patch of news from retailers this past week. 0:13:20.840 --> 0:13:23.520 Target ended a string of quarterly sales declines by focusing 0:13:23.520 --> 0:13:26.800 on cutting prices on essential goods, winning over inflation hit 0:13:26.880 --> 0:13:30.720 consumers who are pulling back from other retailers. Meanwhile, Macy's 0:13:30.760 --> 0:13:33.920 slightly missed analyst estimates for its quarterly revenue and load 0:13:33.960 --> 0:13:35.880 its outlook for sales during the rest of the year, 0:13:36.200 --> 0:13:40.040 citing increased discounting by competitors, and a more cautious consumer 0:13:40.520 --> 0:13:43.199 news too out of TJX and Walmart as well. For 0:13:43.280 --> 0:13:45.400 the roundup, Tim and I leaned on two members of 0:13:45.480 --> 0:13:49.360 the Bloomberg Intelligence team, Jen Bartashis, senior retail staples and 0:13:49.360 --> 0:13:53.559 packaged food analysts, and Mary Ross Gilbert, senior retail analyst. 0:13:53.679 --> 0:13:56.400 What Target has really done is they've honed their focus. 0:13:56.920 --> 0:14:00.520 They've listened to their customers. They've looked at waste, reduce 0:14:00.600 --> 0:14:03.880 prices and make things more affordable or offer more value 0:14:03.880 --> 0:14:06.560 to people. And they've mixed up their assortment. They've added 0:14:06.600 --> 0:14:09.800 new things, They've tried to make things fresh, new to 0:14:09.920 --> 0:14:12.760 appeal to those customers. And for the first time in 0:14:12.880 --> 0:14:16.840 several quarters, we're seeing positive traffic both in stores and online, 0:14:17.559 --> 0:14:19.600 and that sets them up for a strong second half 0:14:19.600 --> 0:14:20.040 of the year. 0:14:20.280 --> 0:14:22.880 So can we assume that they've kind of changed strategy 0:14:22.960 --> 0:14:24.480 or is this just whoa, we just got it right 0:14:24.560 --> 0:14:26.560 right now? How do we guarantee that this continues? 0:14:26.640 --> 0:14:26.840 Jen? 0:14:26.880 --> 0:14:28.960 You know, it's always like, all right, great, what are 0:14:28.960 --> 0:14:30.880 you gonna do for me next quarter? And the quarter after? 0:14:31.640 --> 0:14:33.720 Yeah, I think this is where actually one of the 0:14:33.760 --> 0:14:38.240 interesting divergences is where you see where Target is versus Macy's, 0:14:38.240 --> 0:14:41.160 which is not doing as well. Where you Target is 0:14:41.280 --> 0:14:44.160 pretty good at being quick to pivot and quick to 0:14:44.200 --> 0:14:47.520 implement strategy. And when you think about things more in 0:14:47.520 --> 0:14:50.600 the discretionary category, that takes a little bit of time 0:14:50.640 --> 0:14:53.200 to get the assortment in, get it designed, get it produced, 0:14:53.240 --> 0:14:56.440 get it in stores. And it's in stores now, and 0:14:56.520 --> 0:14:58.800 so you know, I think that what they've got in 0:14:58.880 --> 0:15:02.920 progress will last for at least another couple quarters. The question, 0:15:02.960 --> 0:15:04.720 as you said, Carl, is can they stay on top 0:15:04.760 --> 0:15:08.400 of whatever the consumer tastes changed to over the course 0:15:08.400 --> 0:15:08.920 of that time. 0:15:09.680 --> 0:15:11.960 Shrink this was an issue over the last couple of 0:15:12.000 --> 0:15:14.720 years for the company. I remember them citing Shrink for 0:15:14.760 --> 0:15:17.240 the reason to close stores in certain parts of the 0:15:17.360 --> 0:15:19.320 United States. There was some debate whether or not that 0:15:19.400 --> 0:15:21.720 was actually the reason. Putting that aside, what do we 0:15:21.800 --> 0:15:24.800 learn about Shrink in the most recent report, Well, Shrink. 0:15:24.560 --> 0:15:25.680 Is actually getting better. 0:15:26.200 --> 0:15:29.000 And this is the idea of stuff getting stolen or just. 0:15:28.960 --> 0:15:31.920 Disappearing right exactly. It's things that are either lost to 0:15:32.040 --> 0:15:35.760 theft primarily or through damage in the store. And so 0:15:36.120 --> 0:15:39.200 what you know, there's been a combination of new technology 0:15:39.240 --> 0:15:41.960 implemented at the front end when you're checking out to 0:15:41.960 --> 0:15:44.520 help make sure that people are being upront and honest 0:15:44.520 --> 0:15:47.480 when they're using self checkout, but also it's that the 0:15:48.480 --> 0:15:52.440 consumer is a little less frantic and that was leading 0:15:52.440 --> 0:15:55.560 to some of the theft issues that they were having. So 0:15:55.800 --> 0:15:58.840 a combination of those, they actually realized more benefit from 0:15:58.880 --> 0:16:02.280 a reduction shrink this quart than they expected. They should 0:16:02.280 --> 0:16:04.480 receive a little bit of benefit next quarter, but not 0:16:04.600 --> 0:16:08.640 nearly as much. So the benefits from that coming down 0:16:09.120 --> 0:16:11.680 is probably realized for the most part and will be 0:16:11.880 --> 0:16:13.800 less of a tailwind as we go through the rest 0:16:13.800 --> 0:16:14.200 of the year. 0:16:14.440 --> 0:16:17.000 All Right, So I think about Target and I feel 0:16:17.040 --> 0:16:18.680 like for such a long time they stood out as 0:16:18.680 --> 0:16:22.480 a retailer just you know, innovative, interesting, cool. Who is 0:16:22.520 --> 0:16:24.600 their customer? And I guess I want to I'm curious 0:16:24.640 --> 0:16:26.680 about that because how much that is tied to what 0:16:26.720 --> 0:16:27.760 goes on in the economy. 0:16:28.600 --> 0:16:32.160 Yeah, Historically Target's core customer has been sort of that 0:16:32.240 --> 0:16:35.720 middle income consumer, and you know, some of the higher 0:16:35.920 --> 0:16:38.640 part of the low income consumer as well, and you 0:16:38.680 --> 0:16:41.400 certainly had higher income households there, but the core was 0:16:41.400 --> 0:16:44.360 that middle income and so you know, what we've seen 0:16:44.480 --> 0:16:48.480 is that when Target refocuses on things like value, that 0:16:48.600 --> 0:16:52.080 resonates with that core consumer when they are you know, 0:16:52.120 --> 0:16:54.480 for example, for back to school, they were advertising five 0:16:54.520 --> 0:16:57.920 dollars backpacks, school supplies, you know, at a discount. Those 0:16:57.920 --> 0:17:00.360 are things that will help get their core customer excited 0:17:00.400 --> 0:17:01.240 and back in the store. 0:17:01.760 --> 0:17:04.240 Okay, the big everything taken together, and we're going to 0:17:04.280 --> 0:17:09.480 talk a little bit later about Macy's and about TJX. 0:17:09.840 --> 0:17:12.560 But taken together, what do the results tell us about 0:17:12.560 --> 0:17:14.159 the American consumer big picture? 0:17:14.400 --> 0:17:17.879 When you're looking at these retailers, whether it's Walmart from 0:17:17.960 --> 0:17:21.400 last week, Target today, you know, these retailers that are 0:17:21.480 --> 0:17:25.320 serving that middle income, lower income household, what they're seeing 0:17:25.480 --> 0:17:29.080 is that consumers are still spending, but they're being cautious 0:17:29.080 --> 0:17:33.080 about what they're spending on. They're making very careful decisions. 0:17:33.119 --> 0:17:37.240 And so as you've seen some prices come down, for example, 0:17:37.400 --> 0:17:40.160 we are seeing food inflation easing. We are seeing shelf 0:17:40.200 --> 0:17:44.320 prices come down for some items. That gives consumers a 0:17:44.359 --> 0:17:46.840 little bit more flexibility to perhaps get back into some 0:17:46.920 --> 0:17:50.199 of the more discretionary items. And you know, if you 0:17:50.240 --> 0:17:52.200 think about it, if you go to a fast food 0:17:52.200 --> 0:17:55.040 restaurant and it value me was fifteen dollars and you 0:17:55.040 --> 0:17:57.320 could spend that fifteen dollars or you could spend fifteen 0:17:57.359 --> 0:17:59.800 dollars getting two T shirts for your kids at Target. 0:18:00.520 --> 0:18:02.840 Those are the kinds of decisions that consumers are making, 0:18:03.800 --> 0:18:05.240 especially in that income bracket. 0:18:05.320 --> 0:18:08.080 Hey, one last question, Walmart getting rid of it? It's 0:18:08.160 --> 0:18:10.439 JD dot Com and China. How do we need to 0:18:10.440 --> 0:18:11.040 think about that? 0:18:11.240 --> 0:18:11.359 Well? 0:18:11.400 --> 0:18:13.879 I think this is a strategic exit for Walmart. You know, 0:18:14.000 --> 0:18:17.280 they traditionally will go into partnerships, learn a lot from 0:18:17.280 --> 0:18:19.760 their partners, learn how to do things themselves in it 0:18:19.880 --> 0:18:22.080 operating in a foreign market, and then take over that 0:18:22.160 --> 0:18:25.800 execution themselves. You know, I think when you're talking about China, 0:18:25.920 --> 0:18:29.199 a lot of retailers have become much more targeted in 0:18:29.240 --> 0:18:32.640 their strategy on how they're going to execute in that market. 0:18:33.240 --> 0:18:35.520 And to me, this exit from JD dot Com is 0:18:35.560 --> 0:18:38.560 really just an amplification of some of the policies and 0:18:38.600 --> 0:18:42.240 procedures and ideas that Walmart has had with their international business. 0:18:42.320 --> 0:18:44.560 All right, great stuff, as always, Jen, Thank you so much. 0:18:44.640 --> 0:18:47.840 Jen Bartasha, She's senior Retail Stables and Packaged Food Analysts 0:18:48.040 --> 0:18:49.240 for Bloomberg Intelligence. 0:18:49.359 --> 0:18:52.440 Okay, so target shares maybe surging, JD not so much, 0:18:52.680 --> 0:18:56.439 Macy's not so much. This after the company cut its 0:18:56.480 --> 0:18:58.320 net sales guidance for the full year. It's cited a 0:18:58.400 --> 0:19:03.199 more discriminating consumer and heightened promotional environment. Mary ross Gilbert 0:19:03.200 --> 0:19:05.919 is Bloomberg Intelligence a senior retail analyst. She joins us 0:19:05.920 --> 0:19:10.720 from Los Angeles. We have known that Macy's has been 0:19:10.760 --> 0:19:14.800 facing struggles for years at this point. What did we 0:19:14.880 --> 0:19:17.560 learn that investors did not like so much in the 0:19:17.560 --> 0:19:18.359 most recent quarter. 0:19:18.600 --> 0:19:20.639 Well, I think what investors didn't like so much is 0:19:20.640 --> 0:19:23.560 the fact that they missed their top line estimates. So 0:19:23.560 --> 0:19:26.480 they are looking for a sales decline, just not to 0:19:26.560 --> 0:19:29.320 the magnitude that they experience. So what that meant is 0:19:29.320 --> 0:19:31.600 that they're comp sales and we're really looking at just 0:19:31.640 --> 0:19:34.199 the go forward store base because they are planning to 0:19:34.280 --> 0:19:37.639 shutter one hundred and fifty locations. But those stores and 0:19:37.720 --> 0:19:40.840 their name plate were down over three percent on a 0:19:40.880 --> 0:19:44.720 comp basis. And the reason, look, Macy's face's secular challenges 0:19:44.760 --> 0:19:48.879 as an operator. They're less convenient because they're large department 0:19:48.960 --> 0:19:53.320 stores and they're facing the competition from more convenient and 0:19:53.400 --> 0:19:57.520 competitive shopping options. And this includes not only some of 0:19:57.560 --> 0:20:01.280 the specialty apparel retailers within the mall, but it also 0:20:01.440 --> 0:20:04.840 means that some of the more promotional or off price operators, 0:20:04.880 --> 0:20:06.200 such as a TJ Max. 0:20:06.440 --> 0:20:08.240 So when you just think about the overall. 0:20:07.960 --> 0:20:11.800 Competitive marketplace, but also you should note that Macy's is 0:20:11.840 --> 0:20:16.080 also very promotional. Almost every day they're advertising a promotion. 0:20:16.440 --> 0:20:19.199 And if you click on Macy's online and then you 0:20:19.280 --> 0:20:22.680 start to go away, it'll immediate flash, hell we'll We'll give. 0:20:22.600 --> 0:20:23.920 You twenty five percent off. 0:20:24.000 --> 0:20:26.280 They don't want you to leave, so they're doing what 0:20:26.359 --> 0:20:28.520 they can. But the one thing that we did see 0:20:28.720 --> 0:20:32.680 in their numbers is that this new initiative, which only 0:20:32.720 --> 0:20:36.200 began in the first quarter with the new CEO, Tony Spring, 0:20:36.240 --> 0:20:39.320 who came from Bloomingdale's and really right side of that business, 0:20:39.480 --> 0:20:42.120 what we did see is that the fifty new stores 0:20:42.160 --> 0:20:43.840 that they've enhanced, what did they do. 0:20:43.880 --> 0:20:45.240 They brought back service. 0:20:45.760 --> 0:20:49.320 Service has been absent from department stores for many, many years. 0:20:49.600 --> 0:20:51.800 They brought it back in these fifty stores. 0:20:52.040 --> 0:20:54.560 They enhanced the sortments, so that meant that they brought 0:20:54.600 --> 0:20:59.600 in new brands like Carl Lagerfeld Avec, Lemie, Donna, Karen 0:21:00.400 --> 0:21:03.720 and French Connection and that is growing sales. So their 0:21:03.760 --> 0:21:08.159 comp sales lifted one percent, out performing the rest of 0:21:08.200 --> 0:21:10.800 the Go Forward stores by four hundred and seventy basis points, 0:21:10.840 --> 0:21:13.639 so that's huge. The other thing they did those stores 0:21:13.680 --> 0:21:17.439 are brighter, they're cleaner, they have more modernized signing, and 0:21:17.480 --> 0:21:20.919 then of course they have sales people in handbags and shoes, 0:21:21.400 --> 0:21:24.160 in fitting rooms and in ready to wear for both 0:21:24.240 --> 0:21:28.359 men's and women's and that is really giving them the lift. 0:21:28.520 --> 0:21:31.080 The problem is is they need to move faster and 0:21:31.119 --> 0:21:33.280 they need to extend it across the rest of the 0:21:33.280 --> 0:21:37.080 Go forward stores in order to be successful. So I 0:21:37.119 --> 0:21:40.080 think what investors are not happy with it's not moving 0:21:40.160 --> 0:21:40.800 fast enough. 0:21:40.920 --> 0:21:44.560 So Mary, essentially, bottom line, Macy's has figured out kind 0:21:44.560 --> 0:21:46.320 of the secret sauce of what they need to do. 0:21:46.840 --> 0:21:49.280 They just got to kind of make up the batches 0:21:49.320 --> 0:21:51.480 and get it out to everybody. Is that's essentially they 0:21:51.560 --> 0:21:53.640 just have to move quicker, like they've figured it out. 0:21:54.160 --> 0:21:55.680 Yeah, Carol, I think they do. 0:21:56.480 --> 0:21:58.800 I think that's definitely what we're seeing in the first 0:21:58.800 --> 0:22:01.760 and second quarters with those or fifty stores turning in 0:22:01.840 --> 0:22:02.840 positive comps. 0:22:03.000 --> 0:22:04.359 That's certainly what it looks like. 0:22:04.520 --> 0:22:06.040 Yeah, because I always think about it. I mean, it's 0:22:06.080 --> 0:22:08.359 the same thing I asked Jen Bartashus about. You know, 0:22:08.400 --> 0:22:10.880 when it comes to Target, who is their customer? Who 0:22:10.920 --> 0:22:13.320 is the Macy's customer though, Like I do think about 0:22:13.760 --> 0:22:15.160 who's shopping at these places. 0:22:15.520 --> 0:22:18.200 Yeah, So I would say about half their customer base, 0:22:18.280 --> 0:22:20.919 or more than half their customer base, is probably earning 0:22:21.000 --> 0:22:22.600 less than seventy five thousand. 0:22:23.040 --> 0:22:24.880 So it's a household. 0:22:24.400 --> 0:22:28.840 Income that's being squeezed by inflation, and so that's leaving 0:22:28.880 --> 0:22:34.040 them with less discretionary income to spend on apparel. One 0:22:34.080 --> 0:22:36.080 thing that has turned out to be strong and is 0:22:36.119 --> 0:22:38.840 a good draw for them, of course, is cosmetics, and 0:22:38.880 --> 0:22:43.520 that's the reason why you've seen them expand the cosmetics 0:22:43.600 --> 0:22:45.359 presence in all of their stores. 0:22:45.960 --> 0:22:48.119 Every year, it seems like it's been expanded. 0:22:48.440 --> 0:22:50.200 And that's Blue Mercury, correct. 0:22:50.119 --> 0:22:52.840 Yeah, not all of the stores have Blue Mercury, but yes, 0:22:52.920 --> 0:22:56.120 that includes Blue Mercury, and of course blue Mercury, which 0:22:56.160 --> 0:23:00.719 is more upscale is also you know, it's a growing 0:23:00.840 --> 0:23:03.800 chain for them, and they delivered two percent positive comps 0:23:03.800 --> 0:23:04.280 in the quarter. 0:23:04.440 --> 0:23:10.640 So yes, love my lotions and from everywhere, and I'm 0:23:10.640 --> 0:23:13.000 sure you know investors love the margins when it comes 0:23:13.040 --> 0:23:16.720 to anything, whether it's perfumes or cosmetics. It's pretty crazy. Hey, 0:23:16.800 --> 0:23:19.480 the other thing I do love, I'm Carol Masser and 0:23:19.520 --> 0:23:21.600 I like going to TJ max companies. I'm just going 0:23:21.640 --> 0:23:25.120 to put it out there and it probably needs some interventions. 0:23:25.160 --> 0:23:29.000 But having said that, TJ Max, we also got some 0:23:29.040 --> 0:23:30.879 news from them. We got earnings and they also are 0:23:30.880 --> 0:23:32.840 taking a stake in a Mid East brand. What do 0:23:32.880 --> 0:23:33.920 we need to know about this one? 0:23:34.080 --> 0:23:37.760 Yeah, so because the company has really created this winning 0:23:37.840 --> 0:23:39.679 formula and what that means. 0:23:39.480 --> 0:23:42.680 Is there's years and years of knowledge and expertise. 0:23:42.760 --> 0:23:46.080 Plus they've made major investments in their people, so they 0:23:46.119 --> 0:23:52.280 have longevity with their employees. And you know this includes 0:23:52.320 --> 0:23:54.760 training buyers. It takes fourty five years, by the way 0:23:54.800 --> 0:23:58.000 to train a new buyer just to give you an idea. 0:23:58.080 --> 0:24:01.200 So with this expertise and as they have grown up 0:24:01.240 --> 0:24:04.720 through the ranks, this gives them an opportunity to continue 0:24:04.760 --> 0:24:08.280 to grow internationally. They have always had an interest in Mexico, 0:24:08.359 --> 0:24:10.399 so of course we saw that news after the first 0:24:10.440 --> 0:24:14.160 quarter in which they took an entered into a joint 0:24:14.240 --> 0:24:16.200 venture with groupo Asa, so. 0:24:16.119 --> 0:24:18.080 They're going to be able to use. 0:24:17.960 --> 0:24:22.000 This secret sauce in helping those businesses grow, which will 0:24:22.040 --> 0:24:24.600 make their investments flourish. And so the same thing is 0:24:24.640 --> 0:24:28.280 going to happen with this latest investment, which is a 0:24:28.359 --> 0:24:31.760 Dubai based company operating in the Middle East that operates 0:24:31.800 --> 0:24:35.760 about one hundred brands for less is the name of 0:24:35.800 --> 0:24:38.680 a store concept in that market. 0:24:38.720 --> 0:24:39.760 And could we see more? 0:24:40.000 --> 0:24:43.320 Absolutely, because this is a good use of their cash 0:24:43.400 --> 0:24:47.120 investing and being able to capitalize on their own expertise 0:24:47.480 --> 0:24:51.760 and allowing for some of these executives that they've groomed 0:24:51.920 --> 0:24:55.360 to be able to have a place to deploy their expertise. 0:24:55.480 --> 0:24:58.000 So yes, we're going to see more of that. And 0:24:58.040 --> 0:25:00.600 that just goes to show you that when you're looking 0:25:00.600 --> 0:25:04.160 at retail, off price is winning and TJX being the largest, 0:25:04.240 --> 0:25:08.240 it's a fifty six billion dollar global company, the only 0:25:08.280 --> 0:25:10.920 one that's global and off price and the only one 0:25:10.960 --> 0:25:12.680 that also has e coom our. 0:25:12.680 --> 0:25:16.040 Thanks to Jen Bartasha's Bloomberg Intelligence senior Retail Staples and 0:25:16.080 --> 0:25:19.440 Packaged food analyst, and Mary Ross Gilbert also the Bloomberg 0:25:19.480 --> 0:25:23.840 Intelligence team, She's senior retail analyst still ahead on Bloomberg 0:25:23.880 --> 0:25:26.920 Business Week, No easy way to say it. We've got 0:25:26.920 --> 0:25:29.480 a riveting story on the doctors that cut a giant 0:25:29.520 --> 0:25:32.240 tumor out of one of our colleagues head, which led 0:25:32.359 --> 0:25:35.240 him to investigate and ask is there a better way? 0:25:35.640 --> 0:25:37.480 That story's next? This is Bloomberg. 0:25:43.280 --> 0:25:47.160 You're listening to the Bloomberg Business Week podcast. Listen live 0:25:47.240 --> 0:25:50.160 each weekday starting at two pm Easter on Apple car 0:25:50.160 --> 0:25:53.119 Play and Android Auto with the Bloomberg Business App. You 0:25:53.160 --> 0:25:56.440 can also listen live on Amazon Alexa from our flagship 0:25:56.480 --> 0:25:59.959 New York station. Just say Alexa play Bloomberg eleven five. 0:26:01.320 --> 0:26:04.800 Well you all know the expression it's not brain surgery, Well, Carol, 0:26:05.400 --> 0:26:07.840 sometimes it is just to ask our colleague Noah Bouhier, 0:26:07.920 --> 0:26:10.160 who just a bit over a year ago found himself 0:26:10.200 --> 0:26:13.120 on an operating table at the University of Washington as 0:26:13.119 --> 0:26:16.080 surgeons cut a long upside down you on a scalp, 0:26:16.640 --> 0:26:19.359 peeled back the skin, then made a great fruit sized 0:26:19.400 --> 0:26:22.199 opening in his skull through which they could remove a 0:26:22.280 --> 0:26:25.320 four centimeter wide tumor on the back of his head. 0:26:25.560 --> 0:26:28.880 No Boohire is Bloomberg News Data Investigations reporter. He joins 0:26:28.960 --> 0:26:31.760 us from our Seattle Bureau and for Bloomberg Business WEEKI 0:26:31.840 --> 0:26:34.720 rights not just about his experience, but also about a 0:26:34.760 --> 0:26:38.120 renowned neurosurgeons decades long quest to develop a better way 0:26:38.119 --> 0:26:41.840 to eradicate tumors. No, first of all, we are so 0:26:41.960 --> 0:26:44.800 glad you're okay and you're with us to talk about this, 0:26:45.400 --> 0:26:48.400 what you wrote about. We just can only imagine what 0:26:48.440 --> 0:26:51.720 that time was like. Before we get to talking about 0:26:52.080 --> 0:26:55.120 doctor Neil Cassel, and I hope I'm saying it correctly. 0:26:55.680 --> 0:26:59.760 Tell us about getting your diagnosis, kind of where you 0:27:00.160 --> 0:27:03.400 or what happened and and how you had to. 0:27:03.320 --> 0:27:03.800 Deal with it. 0:27:04.160 --> 0:27:05.800 Thank you for having me on. I mean, it was 0:27:06.280 --> 0:27:09.680 a rather surreal moment. I was actually traveling for work. 0:27:09.760 --> 0:27:13.400 I was in Nashville at a conference, and I took 0:27:13.400 --> 0:27:16.439 a break to go out for a jog one afternoon, 0:27:17.280 --> 0:27:21.119 and toward the end of my run, collapsed with a 0:27:21.560 --> 0:27:25.360 really large seizure on the downtown streets of Nashville. And 0:27:25.480 --> 0:27:28.280 when I came to I took a ride in an ambulance, 0:27:28.720 --> 0:27:31.840 got a CT scan, and that's when the doctors found 0:27:32.160 --> 0:27:34.160 this really large mass in the back of my. 0:27:34.119 --> 0:27:38.080 Head and the mass fortunately was not cancerous. 0:27:38.800 --> 0:27:39.280 Correct. 0:27:39.480 --> 0:27:40.960 Yeah, I mean if you were going to have a 0:27:41.040 --> 0:27:43.320 kind of brain tumor, this is the kind you wanted. 0:27:44.119 --> 0:27:48.879 The pathology later showed that it was extremely slow growing, 0:27:49.000 --> 0:27:53.280 hadn't metastasized, and frankly, this is the kind of thing 0:27:53.320 --> 0:27:55.600 that a neurosurgeon wants to see because they know they'll 0:27:55.640 --> 0:27:58.040 have a high rate of success if they go in 0:27:58.080 --> 0:27:59.560 there to resect it. 0:28:00.080 --> 0:28:01.439 We have quite a bit of time with you, so 0:28:02.000 --> 0:28:04.760 we're gonna sort of go in chronological order here. A 0:28:04.800 --> 0:28:06.679 little over a year ago you did find yourself on 0:28:06.720 --> 0:28:09.440 an operating table. Talk a little bit about the procedure 0:28:09.920 --> 0:28:13.480 and what you actually went through to have this mass removed. 0:28:14.400 --> 0:28:16.800 Yeah, I mean I think you hit the highlights in 0:28:16.880 --> 0:28:20.400 the intro to the segment. Apologies to folks who don't 0:28:20.400 --> 0:28:24.640 want to hear graphic stuff, but the basic operation is 0:28:24.720 --> 0:28:27.920 to make a large incision on your head. Surgeons peel 0:28:27.960 --> 0:28:31.200 back the skin, they cut through the bone, set the 0:28:31.240 --> 0:28:34.240 bone fragment aside, do what they need to do to 0:28:34.280 --> 0:28:40.120 access the airy. Then they reattached the section of bone 0:28:40.520 --> 0:28:43.959 kind of like a lid to a cookie jar, and 0:28:44.000 --> 0:28:46.800 then they stitch you back up. After this whole thing, 0:28:46.920 --> 0:28:48.400 you know, I spent a little bit of time in 0:28:48.440 --> 0:28:51.560 the hospital and then about six weeks at home recuperating, 0:28:51.840 --> 0:28:56.120 but ultimately, you know, within about six months I was 0:28:56.360 --> 0:28:59.000 back to many of my normal activities. I had to 0:28:59.040 --> 0:29:02.120 take a break from driving because of the seizure, but 0:29:02.200 --> 0:29:04.760 by and large, I'm doing what I used to do, 0:29:04.880 --> 0:29:07.960 so by all accounts, and I don't want to disparage 0:29:08.400 --> 0:29:11.880 the conventional surgery. It's incredible what the doctors can do. 0:29:12.600 --> 0:29:15.040 When you get down to it, it's still a rather 0:29:15.400 --> 0:29:19.840 intense process to have to go through, and that's really 0:29:19.880 --> 0:29:21.959 what led me to this story. 0:29:22.160 --> 0:29:25.360 That's exactly why we wanted you to explain what you 0:29:25.400 --> 0:29:28.160 went through, because what you spend the bulk of the 0:29:28.200 --> 0:29:32.760 story talking about is how there could be a solution 0:29:32.920 --> 0:29:36.840 on the horizon that would not require somebody to have 0:29:36.920 --> 0:29:40.960 a procedure as invasion, as invasive. Excuse me, as your 0:29:41.040 --> 0:29:44.120 procedure was tell us about what you learned about doctor 0:29:44.200 --> 0:29:45.320 Neil Cassel. 0:29:45.720 --> 0:29:50.160 Yeah, so I learned about doctor Cassell through actually an 0:29:50.200 --> 0:29:52.920 interesting connection. I've been on this show in the past, 0:29:53.160 --> 0:29:56.960 you all, I think many listeners know this, but I 0:29:57.080 --> 0:29:59.880 used to be the corporate reporter here covering Warren Buffett 0:30:00.080 --> 0:30:04.600 Berkshire Hathaway and more than a decade ago, I wrote 0:30:04.640 --> 0:30:07.640 a profile of a guy named Ted Weshler, who Buffett 0:30:07.680 --> 0:30:11.320 hired to be an investment manager at his company. And 0:30:12.040 --> 0:30:15.080 over the years, you know, I'd been following Weschler's career, 0:30:15.960 --> 0:30:21.479 and after my diagnosis, I happened to be speaking with 0:30:21.600 --> 0:30:24.479 him and I told him what was going on in 0:30:24.480 --> 0:30:28.880 my life, and he said, oh, you should really meet 0:30:29.440 --> 0:30:31.680 a friend of mine here in Charlottesville where he lives, 0:30:32.200 --> 0:30:35.240 named Neil Cassell. I was in the middle of a 0:30:35.240 --> 0:30:38.000 lot of stuff and I sort of blew Weschler off. 0:30:39.120 --> 0:30:41.600 But nine months later I was reading a news story 0:30:41.960 --> 0:30:46.160 and I saw doctor Cassell mentioned, and I thought to 0:30:46.200 --> 0:30:50.040 reach out to Weschler again, and I started learning about 0:30:50.080 --> 0:30:54.080 this foundation that it turns out Weshler had helped Cassell 0:30:54.640 --> 0:30:57.640 start with about a half a million dollars and then 0:30:57.680 --> 0:31:01.720 subsequently given many more more million dollars to this cause. 0:31:02.760 --> 0:31:05.880 And the thing you need to know about Cassel, I 0:31:05.880 --> 0:31:11.560 think he's a very interesting person is that when he 0:31:11.640 --> 0:31:15.480 was practicing neurosurgery, he was one of the co chairs 0:31:15.560 --> 0:31:18.400 of the department at the University of Virginia, and he 0:31:18.520 --> 0:31:21.200 was a really well known stroke doctor. He was the 0:31:21.240 --> 0:31:26.920 guy that was called in when President Joe Biden as 0:31:26.960 --> 0:31:30.120 a senator, needed two aneurism procedures. He was part of 0:31:30.160 --> 0:31:33.520 the team that operated on Biden. But over the years 0:31:33.560 --> 0:31:37.920 he was also really interested in innovative techniques, and about 0:31:37.960 --> 0:31:42.560 two decades ago he got really excited about the idea 0:31:43.160 --> 0:31:47.800 of using ultrasound as a way not as a diagnostic tool, 0:31:48.080 --> 0:31:49.360 but as something that could. 0:31:49.160 --> 0:31:50.440 Actually treat disease. 0:31:51.000 --> 0:31:54.720 And that's when he turned to Wessler set up this foundation, 0:31:55.600 --> 0:32:01.320 and their mission really is to develop new ways to 0:32:01.400 --> 0:32:05.400 augment and advance treatments for a whole host of really 0:32:05.400 --> 0:32:10.959 tricky diseases by using a bunch of effects that ultrasound 0:32:10.960 --> 0:32:12.160 can stimulate in the body. 0:32:12.480 --> 0:32:15.680 I have to say, I am a little obsessed with 0:32:16.080 --> 0:32:19.280 what happened and what you report on. And I'm sure 0:32:19.280 --> 0:32:21.920 you came across to a sixty minutes piece that was 0:32:21.960 --> 0:32:24.720 also about the use of ultrasound, and this was basically 0:32:24.760 --> 0:32:28.680 to open up a blood brain barrier to help drugs 0:32:28.720 --> 0:32:33.360 penetrate and help Alzheimer's patients, but also they talked about 0:32:33.400 --> 0:32:35.560 people with addictions. It just feels like all of a sudden, 0:32:35.720 --> 0:32:38.959 ultrasound is potentially having a moment. 0:32:40.200 --> 0:32:43.800 Yeah, I think it's getting more attention because they're starting 0:32:43.880 --> 0:32:49.040 to be some clinical trials that are yielding interesting results. Now, 0:32:49.080 --> 0:32:52.280 one of the things I wanted to mention here and 0:32:52.680 --> 0:32:54.960 when I went in I wanted to be skeptical, is 0:32:54.960 --> 0:32:58.600 because a lot of these studies and applications of ultrasound 0:32:58.640 --> 0:33:02.720 are still very very early stage. And I just want 0:33:02.720 --> 0:33:04.960 to make that clear to people because there's an interesting 0:33:05.680 --> 0:33:11.600 phenomenon that happens when people are pursuing novel medical technologies. 0:33:11.640 --> 0:33:14.880 There can be a burst of attention and enthusiasm when 0:33:14.960 --> 0:33:18.680 you have positive results out of these early stage studies, 0:33:19.360 --> 0:33:22.560 but as we all know, there are an enormous number 0:33:22.680 --> 0:33:25.560 of hurdles that you need to jump over, both regulatory 0:33:25.680 --> 0:33:29.000 and technical, to bring a treatment to the level where 0:33:29.000 --> 0:33:31.600 it's the standard of care. What I think is so 0:33:31.720 --> 0:33:37.520 fascinating about that is that in ultrasound more broadly, is 0:33:37.520 --> 0:33:42.400 that we're not talking about a single therapeutic. We're actually 0:33:42.400 --> 0:33:48.040 talking about a whole menu of mechanisms that could be 0:33:48.200 --> 0:33:51.520 helpful in delivering all sorts of drugs that we can't 0:33:51.560 --> 0:33:56.200 target to the brain for one reason another, there are also, 0:33:56.520 --> 0:34:00.960 you know, the main mechanism that ultrasound is being used 0:34:00.960 --> 0:34:05.760 for and reimbursed for around the world is about heating 0:34:05.880 --> 0:34:09.520 up parts of the body to basically non invasively sear 0:34:10.040 --> 0:34:12.480 a tumor or an area of the body that you 0:34:12.520 --> 0:34:16.080 want to destroy. But that's just one mechanism of action. 0:34:16.239 --> 0:34:19.120 Heat is one thing that you can deliver with ultrasound. 0:34:19.880 --> 0:34:22.839 Another thing you can do is create a swarm of 0:34:22.840 --> 0:34:27.800 bubbles that in a treatment area that essentially blends up 0:34:28.640 --> 0:34:31.680 like a blender an area of tissue that doctors want 0:34:31.680 --> 0:34:32.120 to target. 0:34:32.480 --> 0:34:34.880 Now, when it comes to bringing a new technology up 0:34:34.960 --> 0:34:38.560 to the standard of care, such as you describe, what's 0:34:38.600 --> 0:34:42.040 a way we can think about a timeline that if 0:34:42.080 --> 0:34:44.759 everything were to go according to plan, this would become available. 0:34:45.120 --> 0:34:48.520 Well, I think that's the really interesting thing here. So 0:34:48.920 --> 0:34:54.960 doctor Cassell has been for years saying that this. When 0:34:55.040 --> 0:34:58.759 he started out nearly twenty years ago, he thought this 0:34:58.800 --> 0:35:02.080 looked like MRI tech technology was thirty five years prior. 0:35:02.760 --> 0:35:05.160 Now we all know what MRIs are. Now so many 0:35:05.200 --> 0:35:07.719 people have had them. If you haven't had one, you 0:35:07.800 --> 0:35:12.040 know someone who has. So on that timeline, it would 0:35:12.080 --> 0:35:15.680 suggest that we'd have, you know, real treatments for some 0:35:15.719 --> 0:35:20.360 of these tricky diseases in the next fifteen twenty years. 0:35:21.840 --> 0:35:25.720 But I think it's going to be disease by disease. 0:35:25.920 --> 0:35:28.840 For some things. Ultrasound's going to work. For some things 0:35:28.960 --> 0:35:33.719 it's not. And one of the real tensions that I 0:35:33.800 --> 0:35:37.480 tried to get at in this story is the real 0:35:37.520 --> 0:35:40.360 need for optimism and enthusiasm if you're even going to 0:35:40.400 --> 0:35:43.680 go to the effort of trying to discover these new treatments. 0:35:44.160 --> 0:35:46.400 But also you know. 0:35:46.400 --> 0:35:50.880 The reality of science and getting things approved and becoming 0:35:50.920 --> 0:35:55.279 standard of care requires an enormous amount of evidence. It 0:35:55.440 --> 0:36:00.000 involves designing clinical trials that are going to prove beyond death, 0:36:00.520 --> 0:36:03.600 not just that something works and is safe, but at 0:36:03.600 --> 0:36:04.719 the end of the day, you want to know that 0:36:04.760 --> 0:36:05.760 it's cost effective. 0:36:05.800 --> 0:36:06.640 I mean, that's what the. 0:36:06.600 --> 0:36:10.160 Payers from medicare to private insurers are going to care about. 0:36:10.520 --> 0:36:13.680 What do you think though, No, our audience, you know, 0:36:13.680 --> 0:36:16.040 who are often looking for like the future trends. Right 0:36:16.040 --> 0:36:17.759 we talked about AI so much right now in the 0:36:17.800 --> 0:36:20.680 GLP one drugs, which are really have been a big 0:36:21.400 --> 0:36:24.480 kind of innovation, it feels like in certainly the pharmaceutical 0:36:24.520 --> 0:36:28.560 space and care in the health world. But how do 0:36:28.600 --> 0:36:31.200 you think our audience should be thinking about what you 0:36:31.280 --> 0:36:35.920 have found out about potentially what could come from ultrasound, 0:36:36.160 --> 0:36:37.800 minding you it could take a while. 0:36:38.600 --> 0:36:41.640 Yeah, Look, I think it's a space to watch. A 0:36:41.680 --> 0:36:45.120 lot of the dollars that are being invested right now 0:36:45.200 --> 0:36:48.919 are coming from private industry, but compared to other kinds 0:36:48.960 --> 0:36:52.520 of medical technology, it's a relatively small amount of money. 0:36:52.920 --> 0:36:56.239 But I think one thing to take note is that 0:36:56.360 --> 0:36:59.640 these aren't silver bullets in and of themselves. Think of 0:36:59.719 --> 0:37:04.560 ultra sound as one tool that might augment or advance 0:37:04.840 --> 0:37:08.960 other methods of attacking very difficult to care diseases. 0:37:09.239 --> 0:37:12.040 And can I ask you, is doctor Cassell the right 0:37:13.320 --> 0:37:15.680 messenger for all of this? He certainly, as you write 0:37:15.760 --> 0:37:18.600 your story, has been great in terms of networking and 0:37:19.239 --> 0:37:22.160 fundraising and is certainly out there. 0:37:22.800 --> 0:37:23.880 He's an interesting person. 0:37:23.920 --> 0:37:27.480 He's obviously got an incredible rolodex and been able to 0:37:27.560 --> 0:37:32.279 get some well healed people and prominent people involved in 0:37:32.320 --> 0:37:36.160 this effort, and I think that certainly has a place. 0:37:36.239 --> 0:37:40.560 Many of the people I spoke with said that he's 0:37:41.160 --> 0:37:44.759 been very important to this field and bringing it to prominence. 0:37:45.520 --> 0:37:48.920 But at the end of the day, he is a 0:37:48.920 --> 0:37:53.240 pretty complicated character. He's a very byzonic mission, a tough boss. 0:37:53.800 --> 0:37:57.239 I think, you know, folks who read the piece will 0:37:57.239 --> 0:38:00.200 get a pretty balanced view of who he is and 0:38:00.200 --> 0:38:01.000 what he's accomplished. 0:38:01.080 --> 0:38:02.200 Sounds like it's a little bit of a sense of 0:38:02.280 --> 0:38:04.560 humor considering how he ended the story. Can you just 0:38:04.600 --> 0:38:06.080 share with us what I sent. 0:38:06.000 --> 0:38:08.640 To your Yeah, not to be too much of a spoiler, 0:38:08.760 --> 0:38:11.440 but it does tie back to my own experience. So 0:38:11.600 --> 0:38:15.479 I had my one year check up and I'm doing great. 0:38:15.520 --> 0:38:18.879 The tumor's not back, but the place where it used 0:38:18.920 --> 0:38:22.640 to sat it sit, excuse me, has grown in size 0:38:23.160 --> 0:38:28.000 and it caused a brief moment of worry whether this 0:38:28.120 --> 0:38:32.440 was going to necessitate another surgery. And I called doctor 0:38:32.480 --> 0:38:36.600 Cassell to tell him about this, and he basically said, 0:38:36.680 --> 0:38:41.400 don't worry. If you're feeling fine, don't have other symptoms. 0:38:41.239 --> 0:38:44.080 Which you'll be. It's something to be admired. 0:38:44.320 --> 0:38:47.279 And he said if my editors were worried that I 0:38:47.320 --> 0:38:49.440 had a hole in my brain, that they should I 0:38:49.480 --> 0:38:52.480 should ask them how many other journalists we employ here 0:38:52.480 --> 0:38:54.240 at Bloomberg who only have half a brain. 0:38:56.920 --> 0:38:58.560 On that note, we're going to wrap it up. Listen, 0:38:58.600 --> 0:39:01.240 incredible reporting We're so glad though, that you are well. 0:39:02.040 --> 0:39:04.200 Thank you so much for sharing your story. No Boo 0:39:04.280 --> 0:39:08.279 hire his Data Investigation's reporter, killer reporter here at Bloomberg News, 0:39:08.320 --> 0:39:10.400 joining us from our Seattle bureau. The story is a 0:39:10.480 --> 0:39:12.560 mustere check it out at Bloomberg dot com and on 0:39:12.640 --> 0:39:13.799 the Bloomberg. 0:39:17.680 --> 0:39:21.200 You're listening to the Bloomberg Business Week podcast. Catch us 0:39:21.239 --> 0:39:24.480 live weekday afternoons from two to five pm Easter Listen 0:39:24.520 --> 0:39:27.880 on Applecarplay and then Bright Auto with a Bloomberg Business app, 0:39:28.000 --> 0:39:29.520 or watch us live on YouTube. 0:39:29.600 --> 0:39:31.520 Let me inn our second hour of the weekend edition 0:39:31.560 --> 0:39:34.960 of Bloomberg Business Week, including how the US Congress is 0:39:35.000 --> 0:39:38.400 indirectly helping out the hotel business. Just ask the CEO 0:39:38.400 --> 0:39:41.440 of Wyndham Hotels and Resorts, which we did, and more, 0:39:41.960 --> 0:39:44.600 Plus the streaming wars, the race for content and leaning 0:39:44.600 --> 0:39:48.480 on influencers with the CEO of Dolphin Entertainment, and from 0:39:48.480 --> 0:39:51.520 what top exec strink to unwind after work to the 0:39:51.560 --> 0:39:56.000 bathroom selfie to j Powell? Are you listening? Because high 0:39:56.000 --> 0:39:59.319 interest rates negatively affected the sale of vintage cars. Our 0:39:59.320 --> 0:40:02.640 Bloomberg pre Suits team covering it all first up this hour. 0:40:02.760 --> 0:40:06.280 It's a content Crazy World. This past week, Edgar Bompin 0:40:06.400 --> 0:40:09.160 Junior raised his offer to take control of CBS parent 0:40:09.200 --> 0:40:12.400 Paramount Global to six billion dollars, according to a person 0:40:12.440 --> 0:40:16.240 familiar with his plans, topping his earlier proposal the week before. 0:40:16.360 --> 0:40:19.520 That's set off a potential bidding war meantime US domestic 0:40:19.560 --> 0:40:22.200 box office movies while they're still struggling to achieve pre 0:40:22.280 --> 0:40:25.480 pandemic revenue status. Our next guest is in the content 0:40:25.520 --> 0:40:28.879 and entertainment space in a kind of unique way. Bill 0:40:28.880 --> 0:40:32.640 Odoubt is the CEO of Dolphin Entertainment. It's a microcap 0:40:32.760 --> 0:40:36.680 entertainment marketing and content production company with a sixteen million 0:40:36.719 --> 0:40:39.840 dollar market capitalization. We begin with a little bit about 0:40:39.920 --> 0:40:41.680 what his company actually does well. 0:40:41.680 --> 0:40:43.759 We do three things all in one. We started as 0:40:43.760 --> 0:40:46.799 a production company film and TV producers, and we still 0:40:46.840 --> 0:40:49.240 do that, having dis released The Blue Angels with Imax 0:40:49.320 --> 0:40:53.759 this spring. Then we started assembling investing class pr and marketing, 0:40:54.080 --> 0:40:58.640 special events, influencer marketing companies around entertainment. And then we 0:40:58.719 --> 0:41:03.239 started investing in things that we could market like consumer products. 0:41:03.560 --> 0:41:04.759 So we're very excited for that. 0:41:05.000 --> 0:41:06.560 All right, So talk to us about the quarter and 0:41:06.600 --> 0:41:09.840 the business. Look back, look forward in terms of we 0:41:09.960 --> 0:41:15.720 mentioned the headline in terms of second quarter revenue, specifically 0:41:15.800 --> 0:41:19.120 in terms of a record that's according to you. Guys 0:41:19.360 --> 0:41:20.800 talked to us about a little bit of the business 0:41:20.840 --> 0:41:23.040 and where the growth is coming from, because you mentioned 0:41:23.040 --> 0:41:26.000 like kind of these three areas. So where's the growth been, 0:41:26.080 --> 0:41:26.759 where's it going? 0:41:27.280 --> 0:41:30.200 Yeah, Well, we've been blessed with a lot of organic growth. 0:41:30.800 --> 0:41:34.560 The companies work together create synergy between you know, creating 0:41:34.600 --> 0:41:40.280 campaigns for motion pictures or consumer products that may want 0:41:40.360 --> 0:41:44.200 both PR and influencer marketing as an example, or event 0:41:44.360 --> 0:41:49.080 marketing with influencer, let's say. And in addition, we're growing 0:41:49.320 --> 0:41:52.640 going back into production. The Blue Angels was a big 0:41:52.719 --> 0:41:55.200 hit for us in partnership with Imax, and that was 0:41:55.239 --> 0:41:57.080 certainly part of the revenue increase as well. 0:41:57.280 --> 0:42:02.239 Well, it's interesting, well and that Imax partner ship, how 0:42:02.320 --> 0:42:04.000 much more can you leverage out of it? 0:42:04.120 --> 0:42:04.279 Right? 0:42:04.360 --> 0:42:06.040 Like, this is something it sounds like it's got some 0:42:06.160 --> 0:42:08.040 legs and I'm curious where you take it? 0:42:09.120 --> 0:42:12.480 Sure, yeah, thank you. It's a multi year partnership. We're 0:42:12.560 --> 0:42:14.960 used to doing that with Dolphin. We were partners with 0:42:15.000 --> 0:42:18.879 Nickelodeon for years and years in making children's content and 0:42:19.680 --> 0:42:21.840 have had fifty to fifty partnerships in the past with 0:42:22.440 --> 0:42:26.960 Warners or others, So we hope to be doing documentaries 0:42:27.000 --> 0:42:29.959 with Imax for years to come. It's certainly a great 0:42:30.000 --> 0:42:32.919 partner to do documentaries with because you can do these 0:42:32.960 --> 0:42:38.800 big spectacle documentaries, dockbusters as we call them, that really 0:42:39.000 --> 0:42:40.960 deserve to be seen on the big screen, like The 0:42:40.960 --> 0:42:41.680 Blue Angels. 0:42:41.960 --> 0:42:43.920 Yeah, and we you know the press release that you 0:42:43.920 --> 0:42:46.440 guys put out it talked about, you know, debuting as 0:42:46.520 --> 0:42:50.280 number one on prime video over the Memorial Day holiday. 0:42:50.719 --> 0:42:54.640 It grossed what over two million at the box office IMAX, 0:42:55.080 --> 0:42:57.359 and that included a top ten debut with about one 0:42:57.360 --> 0:43:01.040 point four million in its opening week end. That what 0:43:01.080 --> 0:43:02.359 did you call it? Dockbusters? 0:43:03.440 --> 0:43:03.919 That's right? 0:43:04.040 --> 0:43:07.080 Yeah, So where else do you go with like do 0:43:07.120 --> 0:43:10.600 you just continue to do more of that? And how 0:43:10.640 --> 0:43:13.080 expensive is it to do and build out that content? 0:43:13.320 --> 0:43:16.680 Well, documentaries are less expensive than the bigger features, of course, 0:43:16.719 --> 0:43:20.879 so they typically range in the three to five million range, 0:43:20.920 --> 0:43:23.880 let's say for theatrical Obviously you can make them for 0:43:23.960 --> 0:43:27.040 less or more, and we do think there's an opening 0:43:27.080 --> 0:43:29.279 to do one or two of those a year. They 0:43:29.280 --> 0:43:33.000 certainly program well, there are gaps in the year where 0:43:33.200 --> 0:43:36.400 there wouldn't be studio content available or fresh studio content 0:43:36.760 --> 0:43:40.080 to put in dimacs. And also we think our partnership 0:43:40.160 --> 0:43:43.200 is expanding into live streaming as well. You know, we 0:43:43.239 --> 0:43:48.960 could do music specials, Broadway specials, comedy specials, you know, 0:43:49.239 --> 0:43:51.799 one night only type things that would really juice we 0:43:51.880 --> 0:43:53.880 hope the box office, especially midweek. 0:43:54.080 --> 0:43:55.680 When do you start to do something like that or 0:43:55.719 --> 0:43:58.719 what's involved in getting into that area more aggressively. 0:43:59.160 --> 0:44:02.239 We hope to launched that in the first quarter next year, 0:44:02.280 --> 0:44:07.120 and Imax has already been doing some of that themselves, 0:44:07.160 --> 0:44:10.719 and it's a natural extension of our partnership to go 0:44:10.800 --> 0:44:11.960 into that content together. 0:44:12.239 --> 0:44:13.799 What's the challenge in all of this, because I do 0:44:13.840 --> 0:44:15.600 feel like, you know, Bill, I think it's safe to 0:44:15.600 --> 0:44:17.680 say we cover this a lot at Bloomberg that I mean, 0:44:17.719 --> 0:44:21.200 there's a lot of places to view content, there's a 0:44:21.200 --> 0:44:23.520 lot of content creators, but there's a lot of people 0:44:23.600 --> 0:44:26.600 vuying for that content. So what's the stuff that really 0:44:26.719 --> 0:44:29.759 you think moves the needle in terms of engaging with 0:44:29.800 --> 0:44:31.920 the consumer, Because I know I get to a point 0:44:31.960 --> 0:44:33.640 where I'm just overwhelmed and I'm done, and I pick 0:44:33.680 --> 0:44:37.040 up a book and read. But I just wonder, right, 0:44:37.080 --> 0:44:39.760 you've got to kind of read through a lot of stuff. 0:44:40.520 --> 0:44:40.800 Sure to. 0:44:41.040 --> 0:44:44.719 And I like reading too, so I understand completely. And 0:44:45.080 --> 0:44:47.080 I think a lot of people try, and you know, 0:44:47.160 --> 0:44:49.520 thread the needle by thinking about what would work best 0:44:49.520 --> 0:44:52.080 in which type of delivery. You know, when you talk 0:44:52.200 --> 0:44:55.640 something like an IMAX system then and network, then you're 0:44:55.680 --> 0:44:58.960 talking you want that spectacle, something that warrants people coming 0:44:59.040 --> 0:45:02.080 out and spending the mon you know, on the smaller 0:45:02.120 --> 0:45:04.319 screen and the steep streaming wars, you're seeing a lot 0:45:04.400 --> 0:45:08.200 of people look for different types of content. And if 0:45:08.200 --> 0:45:10.200 you think about the last ten years, the rise of 0:45:10.320 --> 0:45:15.120 documentaries are true crime, especially on the small screen, has 0:45:15.200 --> 0:45:15.960 really exploded. 0:45:16.040 --> 0:45:20.840 What about you mentioned live sports, Broadway comedy other or 0:45:20.840 --> 0:45:23.120 you mentioned Broadway comedy. What about sports in terms of 0:45:23.200 --> 0:45:25.440 last streaming or is that just a too expensive, already 0:45:25.480 --> 0:45:27.759 crowded the big boys, the big guys are in it. 0:45:28.120 --> 0:45:32.000 I think the live certainly sporting events, it's probably crowded, 0:45:32.600 --> 0:45:35.120 and those rights only seem to be going up and 0:45:35.200 --> 0:45:39.040 up right, But we do like sports content generally quite 0:45:39.040 --> 0:45:41.840 a bit, and you're seeing a lot of opportunity this 0:45:41.960 --> 0:45:44.879 year around women's sports, and that's an area that we 0:45:44.960 --> 0:45:49.799 really like. We think female athletes have been underserved tremendously, 0:45:50.880 --> 0:45:53.759 and with our influencer marketing companies, we think we could 0:45:53.760 --> 0:46:00.880 expand and bring brand sponsorship deals and just generally income 0:46:00.920 --> 0:46:03.399 to female athletes from speaking engagements, et cetera. 0:46:03.680 --> 0:46:06.120 You mentioned the influencers, and I thought that was really interesting. 0:46:06.160 --> 0:46:09.400 I know you've got a relationship with Glow Lab. You 0:46:09.440 --> 0:46:11.880 are thinking about the younger audience. I mean, first of all, 0:46:11.880 --> 0:46:14.040 a couple things, what is your target audience or you 0:46:14.080 --> 0:46:15.799 don't care, you want to go all over the all 0:46:15.840 --> 0:46:17.440 over the kind of age spectrum. 0:46:17.719 --> 0:46:20.560 I think with influencer you can you can broaden out. 0:46:20.360 --> 0:46:23.400 We started with the core, which you know, female twenty 0:46:23.400 --> 0:46:27.520 five to forty four, let's say beauty, wellness, fashion products. 0:46:27.520 --> 0:46:31.000 But the thing about influencer marketing it's it's it's grown 0:46:31.080 --> 0:46:34.000 double digits year over year some years, I think triple 0:46:34.000 --> 0:46:40.440 digits simply because there is no one demo anymore. Yeah, 0:46:39.560 --> 0:46:44.080 and the marriage of influencer with sports is it was 0:46:44.120 --> 0:46:47.719 going to come anyway, but it's certainly accelerated three years 0:46:47.719 --> 0:46:50.360 ago with the Supreme Court ruling you know name image 0:46:50.440 --> 0:46:55.879 likeness for college athletes, and now this generation are influencers. 0:46:55.920 --> 0:46:59.400 This generation of athletes, right, you could just see Simone 0:46:59.400 --> 0:47:02.120 Biles taking selfies at the Olympics or get ready with 0:47:02.160 --> 0:47:04.839 any videos at the Olympics, and you know that if 0:47:04.840 --> 0:47:08.720 you're talking athletes fifteen to twenty five, they're digital natives 0:47:08.960 --> 0:47:09.359 for sure. 0:47:10.080 --> 0:47:12.719 Well, when you think about the work with influencers, as 0:47:12.719 --> 0:47:14.879 you said, I mean you also want to be what 0:47:15.160 --> 0:47:18.040 creating the products that they're involved in or talk to 0:47:18.120 --> 0:47:21.279 us about how you kind of drill down into that relationship, 0:47:21.320 --> 0:47:24.520 which I would assume that opens up even another revenue 0:47:24.520 --> 0:47:26.640 stream for you guys, it Shurret. 0:47:26.440 --> 0:47:27.080 Does, thank you. 0:47:27.160 --> 0:47:30.360 Yeah, it's really marrying a couple of different aspects of 0:47:30.400 --> 0:47:34.000 our business. You know, we financed and produced television and 0:47:34.040 --> 0:47:37.239 film for twenty years prior to going public. We're used 0:47:37.239 --> 0:47:40.000 to project finance, and then when you marry that with 0:47:40.120 --> 0:47:43.960 the rise of social media and influencer marketing, then it's 0:47:44.000 --> 0:47:48.000 really just applying project finance to consumer product. We could 0:47:48.000 --> 0:47:52.919 develop and bring to market consumer products where our form 0:47:52.960 --> 0:47:55.799 of marketing, especially in entertainment, will give us a better 0:47:55.880 --> 0:48:00.400 chance of success. So when you think about beauty cosmetics 0:48:00.200 --> 0:48:04.279 as an example. Those are products where influencers and celebrities 0:48:04.320 --> 0:48:09.680 have long influence success. And so we think there are 0:48:09.719 --> 0:48:14.440 certain product categories like alcohol, where the marketing of the 0:48:14.480 --> 0:48:18.960 product is as important as the manufacturing and the distribution itself. 0:48:19.040 --> 0:48:20.600 But it'd be great if you get a piece of both, 0:48:20.680 --> 0:48:21.760 right going forward? 0:48:21.880 --> 0:48:24.040 That's right, that's right, hey, Bill. 0:48:24.080 --> 0:48:25.359 One thing I did want to ask you when we 0:48:25.360 --> 0:48:27.080 were talking a little bit of nuts and bolts in 0:48:27.160 --> 0:48:30.759 terms of the quarter. You are a microcap company. We 0:48:30.920 --> 0:48:34.359 don't on Bloomberg talk a lot to companies that are 0:48:34.360 --> 0:48:39.120 below a buck, and I am curious what you get 0:48:39.200 --> 0:48:43.480 from investors. Stocks down about sixty percent year to date. 0:48:43.520 --> 0:48:45.400 What do you hear from your investors? And what are 0:48:45.440 --> 0:48:49.080 your aspirations? Is there something about you know? I understand 0:48:49.080 --> 0:48:51.279 sometimes we start small, we get bigger. What are your 0:48:51.320 --> 0:48:53.960 aspirations for this company? And what do you hear from 0:48:54.000 --> 0:48:54.680 your investors? 0:48:55.080 --> 0:48:55.960 Sure? Yeah, I know. 0:48:56.360 --> 0:48:59.000 While the microcap environment as a whole, as I'm sure 0:48:59.040 --> 0:49:01.439 you know, Carol has been had a tough year. 0:49:01.560 --> 0:49:01.759 Yep. 0:49:02.080 --> 0:49:05.600 We've posted record quarterly revenue three quarters in a row 0:49:06.160 --> 0:49:09.440 so and positive adjusted operating income. 0:49:09.560 --> 0:49:11.920 So we're we're hopeful and confident. 0:49:11.480 --> 0:49:15.600 That the will be rewarded in the market, especially as 0:49:15.600 --> 0:49:18.840 a microcup doing real revenue with real business. 0:49:18.960 --> 0:49:20.839 So is it just investors saying, listen, we get it, 0:49:20.840 --> 0:49:22.239 it's the environment, or what do they want to know 0:49:22.239 --> 0:49:24.319 about your business in particular? What are the questions you 0:49:24.360 --> 0:49:25.880 get most from investors? 0:49:26.480 --> 0:49:29.440 Yeah, I'd say it's mostly about the environment. You know, 0:49:30.480 --> 0:49:32.319 numbers don't lie in terms of what we're doing in 0:49:32.360 --> 0:49:36.200 revenue and adjusted operating income, and we're beating our own projections, 0:49:36.320 --> 0:49:40.560 including the analyst projections out there. So there's there's a 0:49:40.600 --> 0:49:42.520 sense of frustration with some that you know, they just 0:49:42.560 --> 0:49:44.759 wish that, you know, we weren't being lumped in with 0:49:44.800 --> 0:49:47.000 some of the others. But you know, we just have 0:49:47.120 --> 0:49:50.120 to stay the course. I mean, a micro cup that's 0:49:50.160 --> 0:49:53.279 doing fifty million revenue and a sixteen million dollar market cap, 0:49:53.600 --> 0:49:55.760 you'd like to believe that you're about to pop back. 0:49:56.120 --> 0:49:58.799 When you look at the environment, and I think it's 0:49:58.920 --> 0:50:02.000 you know, Bill, it's an interesting one. We're very focused on, 0:50:02.560 --> 0:50:05.320 you know, what's going on in terms of Fed policy, 0:50:05.840 --> 0:50:08.040 what's going on in terms of economic data. We talked 0:50:08.040 --> 0:50:09.880 a lot by the end of the week about a 0:50:09.960 --> 0:50:12.600 soft landing, and it looks like things are, you know, 0:50:12.920 --> 0:50:15.960 kind of working out fairly well, not all Americans certainly 0:50:15.960 --> 0:50:19.120 feel that. We talk a lot about the differences between 0:50:19.120 --> 0:50:22.160 the top and the bottom in terms of the economic strata. 0:50:22.200 --> 0:50:24.799 Having said that, when you look at the environment, you're 0:50:24.840 --> 0:50:27.680 doing deals, you're doing different things. How do you describe 0:50:27.680 --> 0:50:29.560 the US economy right now? 0:50:29.800 --> 0:50:32.120 Well, we're hopeful for the for the rate coaches. I 0:50:32.120 --> 0:50:35.000 think like a lot of people will free up cash 0:50:34.640 --> 0:50:40.440 and discretionary investment into the microcap world, small cap world generally, right. 0:50:40.480 --> 0:50:42.439 I think you hear a lot of people talk about that. 0:50:44.320 --> 0:50:47.280 We're not as susceptible to some other companies in terms 0:50:47.440 --> 0:50:53.480 of the interest rates. We've fixed ours in commercial paper already, 0:50:53.560 --> 0:50:58.080 so we feel good about our position. But certainly lower 0:50:58.120 --> 0:51:02.040 interest rates or lower federates would certainly benefit the microcap 0:51:02.080 --> 0:51:02.680 world for sure. 0:51:02.880 --> 0:51:05.200 All right, Yeah, No, we talked about that actually earlier 0:51:05.280 --> 0:51:08.520 in terms of small caps and the importance of economic 0:51:08.560 --> 0:51:12.080 growth as well as in terms of the interest rate environment, bigger, 0:51:12.120 --> 0:51:14.719 broader picture. We spent a lot of time talking about 0:51:14.800 --> 0:51:16.920 kind of what happens to some of the big media players. 0:51:16.920 --> 0:51:19.520 We talk about streaming so much. You are in the 0:51:19.560 --> 0:51:23.640 content business. What do you make of all of what's 0:51:23.680 --> 0:51:25.480 going on in the streaming world. It's a lot of 0:51:25.480 --> 0:51:28.480 competition for all of our eyeballs, and there are obviously 0:51:28.520 --> 0:51:30.799 some very clear winners and some that are having a 0:51:30.840 --> 0:51:31.399 tougher time. 0:51:33.040 --> 0:51:36.160 Yeah, and we're blessed where our film and television PR 0:51:36.239 --> 0:51:39.720 firm forty two West, works with almost every major streamer 0:51:40.480 --> 0:51:43.800 out there, and we promote shows on so many different platforms, 0:51:43.840 --> 0:51:45.239 from Netflix to Amazon to. 0:51:46.840 --> 0:51:50.680 Hulu and Paramount Plus, etc. So we see a. 0:51:50.600 --> 0:51:55.680 Lot of them contracting some in terms of investment, as 0:51:55.680 --> 0:51:59.200 I'm sure you've talked about quite a bit. But the 0:51:59.280 --> 0:52:02.319 sheer vol of programming the last few years has been 0:52:02.360 --> 0:52:05.240 overwhelming to a lot of consumers, I think, And probably 0:52:05.280 --> 0:52:06.520 this is for the best. 0:52:06.560 --> 0:52:09.120 And so you don't care kind of who wins because 0:52:09.120 --> 0:52:11.480 you get to work with them, all right, that's fair 0:52:11.560 --> 0:52:13.480 to say. But I wonder do you think that there 0:52:13.520 --> 0:52:15.480 will be because you do see some that might be 0:52:15.520 --> 0:52:18.840 struggling or slowing down a little bit, that there'll be 0:52:18.840 --> 0:52:20.120 some kind of shakeout. 0:52:20.080 --> 0:52:22.920 And there has to be a one would think, you know, 0:52:23.040 --> 0:52:27.560 And certainly the conversations out there about M and A 0:52:27.560 --> 0:52:30.520 among some of you in the bigger studios, right, isn't 0:52:30.560 --> 0:52:34.160 idle speculation, So there'll be a right sizing of the ship, 0:52:34.200 --> 0:52:37.239 I think, and the industry hopefully will be stronger for it. 0:52:37.840 --> 0:52:39.759 So what's kind of interesting when you look at the 0:52:39.760 --> 0:52:41.799 content and media world and you look out. You know, 0:52:41.800 --> 0:52:44.160 we talked a little bit earlier about influencers and your 0:52:44.200 --> 0:52:46.600 work with Glow Lab, and it is interesting in a 0:52:46.640 --> 0:52:49.759 week where again you know Warren Buffett, you know, we 0:52:49.920 --> 0:52:52.239 saw his stake in Olda Beauty. We talked about it 0:52:52.239 --> 0:52:54.719 through the pandemic and out of the pandemic that whether 0:52:54.760 --> 0:52:56.520 it was Spoor or some of the other names that 0:52:56.600 --> 0:53:00.200 you know, people spend. It's not just cosmetics, it's all 0:53:00.280 --> 0:53:03.919 kinds of beauty and you know, skincare and so on and 0:53:03.880 --> 0:53:07.200 so forth. That that spending kind of continues. You guys 0:53:07.200 --> 0:53:10.080 also work with Rachel Ray, So chefs are something that's 0:53:10.320 --> 0:53:13.120 certainly on your radar when you think about growth areas 0:53:13.120 --> 0:53:14.880 for content. If you had to whittle it down to 0:53:14.920 --> 0:53:17.480 one thing, what would it be. There's also AI, right, 0:53:17.520 --> 0:53:20.360 so the creation of whatever that content will be. 0:53:21.360 --> 0:53:24.920 Yeah, and AI is unstoppable, right, we take a positive 0:53:24.920 --> 0:53:29.680 spin on it, certainly but well, I think when you 0:53:29.840 --> 0:53:32.400 take a step back and you think the world before 0:53:32.680 --> 0:53:36.640 and after the rise of social media, you can make 0:53:36.680 --> 0:53:40.360 a case that what it's done through the explosion of 0:53:40.400 --> 0:53:43.080 what used to be Remember when it was mommy, bloggers, 0:53:43.320 --> 0:53:47.680 and then it became influencers and now it's creators. You 0:53:47.719 --> 0:53:50.760 could make an argument that's democratized the ability to launch 0:53:50.760 --> 0:53:55.400 certain types of consumer products. Early in my career, you 0:53:55.440 --> 0:53:58.680 would need, you know, tens of millions of dollars of 0:53:58.880 --> 0:54:03.160 pay in media to just get awareness of the US consumer. Today, 0:54:03.200 --> 0:54:06.640 you've got influencers launching their own skincare products and selling 0:54:06.680 --> 0:54:09.720 the companies three years later for over three hundred million dollars, 0:54:09.840 --> 0:54:13.319 as Susan Yarra and Glow Lab did with Notarium to 0:54:13.360 --> 0:54:17.200 helf Beauty. So you know that that's unfathomable, you know, 0:54:17.200 --> 0:54:21.520 fifteen years ago, ten years ago. So we see a 0:54:21.560 --> 0:54:28.280 lot of potential using influencer marketing and pr earned media 0:54:28.320 --> 0:54:33.840 generally to launch and content on those channels to to 0:54:33.880 --> 0:54:37.600 be able to drive traffic. That's on the consumer products side, 0:54:37.640 --> 0:54:39.440 of course, on the on the pure content side, I 0:54:39.440 --> 0:54:41.200 think it raised a lot of eyebrows in the last 0:54:41.239 --> 0:54:46.160 week or two. You know that on television sets, YouTube 0:54:46.200 --> 0:54:50.800 gets more viewing than Netflix, and and I think that 0:54:50.800 --> 0:54:54.040 that raised a lot of awareness, you know, outside of 0:54:54.080 --> 0:54:58.160 our world, just how big social media is to to 0:54:59.000 --> 0:55:00.879 all demographics and not just you know. 0:55:00.920 --> 0:55:04.600 The ya listen, right now you are on YouTube. We 0:55:04.600 --> 0:55:06.120 don't get to see your face right now you're on 0:55:06.160 --> 0:55:08.160 the phone, but if you were on Zoom and so 0:55:08.200 --> 0:55:11.160 on and so forth. I mean, right now, simmilcast on radio, 0:55:11.239 --> 0:55:13.680 we're on YouTube, and we're on our streaming service, and 0:55:13.680 --> 0:55:16.640 then earlier we're also on television. So it's just interesting, 0:55:16.719 --> 0:55:19.200 like the different venues. I watch a lot of YouTube channels. 0:55:19.200 --> 0:55:22.400 There's some interesting stuff, very niche programming. If you had 0:55:22.440 --> 0:55:25.000 to pick one with our YouTube TikTok or some kind 0:55:25.040 --> 0:55:28.600 of delivery service that you think is really going to 0:55:28.640 --> 0:55:30.400 be or continue to be the most influential, and just 0:55:30.440 --> 0:55:31.920 got about twenty seconds, what would it be? 0:55:33.080 --> 0:55:33.680 YouTube? 0:55:34.440 --> 0:55:37.239 Hands down, hands out, hands down. 0:55:37.680 --> 0:55:39.840 It can do both short and long form, and it's 0:55:39.880 --> 0:55:41.000 already got the mass. 0:55:41.160 --> 0:55:44.120 All right, great stuff as always, listen, Thank you so much. 0:55:44.239 --> 0:55:48.120 Jillo doubt He's founder and chief executive officer of Dolphin Entertainment, 0:55:48.239 --> 0:55:51.360 joining us on this Friday in Miami. 0:55:56.680 --> 0:56:00.839 You're listening to the Bloomberg Business Week podcast live each 0:56:00.840 --> 0:56:03.880 weekdays starting at two pm Eastern on applecar Play and 0:56:03.960 --> 0:56:07.000 Android Auto with the Bloomberg Business App. You can also 0:56:07.040 --> 0:56:10.560 listen live on Amazon Alexa from our flagship New York station, 0:56:10.960 --> 0:56:13.680 Just Say Alexa playing Bloomberg eleven thirty. 0:56:14.320 --> 0:56:16.800 Window Hotels and Resorts has some twenty five brands in 0:56:16.840 --> 0:56:20.719 about ninety five countries and ninety one hundred plus hotels, 0:56:20.760 --> 0:56:22.880 and this past week and opened up another one, the 0:56:22.920 --> 0:56:26.680 Echo Suite's Extended Stay by Wyndham Dallas, Plano, Frisco, the 0:56:26.719 --> 0:56:30.400 second extended state Echo property to open in the United States. 0:56:30.680 --> 0:56:32.480 With more on that, and I'll look at the Leisure 0:56:32.480 --> 0:56:35.000 and Business Traveler, My co host Tim Steneveek and I 0:56:35.080 --> 0:56:38.000 checked in with the President CEO of Wyndham Hotels and Resorts, 0:56:38.239 --> 0:56:39.000 Jeff Bollotti. 0:56:39.360 --> 0:56:43.440 This is the first hotel that a developer of my 0:56:43.600 --> 0:56:46.480 name of Ian McClure of Gulf Coast Hospitality based here 0:56:46.520 --> 0:56:50.200 in Texas, Texas, a very important state for US. He's 0:56:50.200 --> 0:56:53.480 building twenty five of these Echo Suites by Window. 0:56:53.560 --> 0:56:55.760 The demand for this type of products incredible. 0:56:55.800 --> 0:56:59.280 It's a very comfortable reveit it's our fastest growing brand 0:56:59.280 --> 0:57:00.600 because of the demand that's out there. 0:57:00.800 --> 0:57:02.800 Well, tell us about that, why it is your fastest 0:57:02.800 --> 0:57:05.480 growing and what is the demand specifically, who wants to 0:57:05.480 --> 0:57:07.799 stay there, Who's demanding like, hey, we need these kind 0:57:07.840 --> 0:57:08.320 of places. 0:57:08.640 --> 0:57:13.640 Gosh, last month I was sleeping up out in Spartanburg, 0:57:13.719 --> 0:57:16.760 South Carolina, where Spartanburg has received a billion of the 0:57:16.880 --> 0:57:20.360 nine billion that that state, that single state has been 0:57:20.400 --> 0:57:23.800 awarded of this want so far, of this one point 0:57:23.840 --> 0:57:28.280 five trillion dollar piece of legislation, the most historic piece 0:57:28.680 --> 0:57:32.200 of legislation this country's ever seen. There are one point 0:57:32.280 --> 0:57:37.280 eight million companies that are contracting. They're workers for projects 0:57:37.320 --> 0:57:41.560 that are now just beginning to get started, and they're 0:57:41.640 --> 0:57:47.480 looking for this type of affordable, clean economy accommodation to. 0:57:47.400 --> 0:57:50.240 Put them in. I mean here in Plano, perfect example. 0:57:50.280 --> 0:57:54.600 There is so much development going on around the community 0:57:54.640 --> 0:57:57.480 here that I'm in today and that i'll be this 0:57:57.520 --> 0:58:01.560 evening with developers looking to build more and other brands 0:58:02.080 --> 0:58:06.480 from a medical profession, from the automotive profession, and a 0:58:06.640 --> 0:58:11.600 litany of projects that haven't yet begun that are going 0:58:11.680 --> 0:58:16.040 to begin soon. And companies are out contracting right now 0:58:16.240 --> 0:58:19.160 for lodging accommodations like this. It's it really is. It's 0:58:19.760 --> 0:58:22.160 it's an amazing I've been in this industry for thirty years. 0:58:22.160 --> 0:58:23.720 I've never seen anything quite like it. 0:58:23.720 --> 0:58:25.960 It's really fascinating. I'm just kind of going back to 0:58:26.000 --> 0:58:28.040 what you kind of kicked off with. So you're talking 0:58:28.040 --> 0:58:32.000 about the spending bills and the legislation that's come out 0:58:32.080 --> 0:58:34.840 of the US Congress, and that is really shaping kind 0:58:34.880 --> 0:58:36.680 of where you develop exactly. 0:58:36.760 --> 0:58:41.240 I mean, our teams have identified about four thousand of 0:58:41.280 --> 0:58:46.160 the forty thousand projects that will be funded by the 0:58:46.360 --> 0:58:49.840 one point five trillion dollar bill and the two hundred 0:58:49.840 --> 0:58:54.800 and fifty billion dollar Chips Act bill, those Chip Acts build. 0:58:54.840 --> 0:58:56.320 That bill has has. 0:58:56.280 --> 0:59:00.960 Begun funding projects in a here in Texas as well. 0:59:01.120 --> 0:59:03.640 We have this this is our six hundred and ninety 0:59:03.920 --> 0:59:06.960 first hotel that we've opened as a company. 0:59:07.240 --> 0:59:11.800 But in Taylor, Texas, Samsung is building a plant, a 0:59:11.880 --> 0:59:16.400 chip plant where they will spend seventeen billion dollars over 0:59:16.480 --> 0:59:20.920 the next ten years. And they have thousands of workers 0:59:21.000 --> 0:59:24.960 right now who are looking for long term lodging accommodation. 0:59:25.360 --> 0:59:28.640 They're checking in for five, six, seven months, some are 0:59:28.720 --> 0:59:32.560 checking in for over a year. Many are from other 0:59:32.640 --> 0:59:35.040 parts of Texas and driving home on the weekends. 0:59:35.520 --> 0:59:36.520 But they want a. 0:59:36.480 --> 0:59:39.200 Place that they could cook, put their dishes in a 0:59:39.360 --> 0:59:43.960 full sized dishwasher, having full sized refrigerator, and in a 0:59:43.960 --> 0:59:46.760 great microwave. They want a place that feels like home. 0:59:46.880 --> 0:59:50.440 And and that's what's that's what's fuel and Carroll demand. 0:59:50.760 --> 0:59:53.040 You know, what does it feel like? Waterville, Maine, Jeff, 0:59:53.320 --> 0:59:57.640 which is I'm just now learning where you and I 0:59:57.720 --> 1:00:01.439 both went to college, a small school called Colby, where 1:00:01.440 --> 1:00:07.240 we found ourselves freezing pretty much November through April every year, 1:00:07.600 --> 1:00:10.280 hold up in our dorm rooms playing beer pong because 1:00:10.280 --> 1:00:11.960 it was so cold. And main it's main. 1:00:12.280 --> 1:00:15.720 I know, Tim. 1:00:15.920 --> 1:00:18.480 I don't know if you've been back to Waterville lately, 1:00:18.520 --> 1:00:21.920 but it has been transformed. The development that's going on 1:00:22.320 --> 1:00:24.200 in downtown Waterville is really. 1:00:24.000 --> 1:00:24.800 Impressive to see. 1:00:24.800 --> 1:00:27.680 And I was thinking to myself, Fine'm smiling so lively 1:00:28.040 --> 1:00:31.360 that Waterville needs an echo sweets extended, say by windhow 1:00:31.360 --> 1:00:34.680 because we would kill it in that market, as you know, 1:00:34.800 --> 1:00:37.640 with parents who did not have the logic accommodation. So 1:00:37.800 --> 1:00:41.360 when we were there that are available today on the 1:00:41.440 --> 1:00:42.400 new construction round. 1:00:42.560 --> 1:00:44.960 Yeah, just so everybody knows. It's an old milltown that, 1:00:45.640 --> 1:00:47.600 like many mill towns in New England, had fallen on 1:00:47.640 --> 1:00:50.360 hard times years ago. The college and the hospital, at 1:00:50.400 --> 1:00:52.160 least when I was there in Waterville Main were the 1:00:52.160 --> 1:00:55.640 biggest employers, and you can see it. But since I've 1:00:55.640 --> 1:00:59.160 been there, I graduated close to twenty years ago, and 1:00:59.600 --> 1:01:03.720 there's incredible development in the area, really a revitalization of downtown. 1:01:04.000 --> 1:01:07.800 All right. So I'm curious though, so exciting growth development, 1:01:07.880 --> 1:01:10.480 but what happens I don't know when the money kind 1:01:10.520 --> 1:01:13.600 of runs out in terms of the development from like legislation. 1:01:13.680 --> 1:01:16.560 Do you worry about that you won't have the people 1:01:16.560 --> 1:01:19.320 who will be demanding these kind of rooms in Plano, 1:01:19.360 --> 1:01:20.760 Texas or elsewhere throughout the. 1:01:20.680 --> 1:01:23.680 State, Carol, That is a long time away. I mean 1:01:23.720 --> 1:01:28.240 we are in the very early innings. Less than twenty percent. 1:01:28.360 --> 1:01:30.440 I think the figure from the COB is less than 1:01:30.480 --> 1:01:35.360 seventeen percent of the one point five trillion has been allocated, 1:01:35.680 --> 1:01:38.480 and even a smaller percentage of that has been spent 1:01:38.560 --> 1:01:40.360 in terms of shovels on the ground. 1:01:40.640 --> 1:01:43.640 The projects that you and Tim are probably hearing about 1:01:43.720 --> 1:01:44.440 and reading about. 1:01:44.840 --> 1:01:46.520 I mean, you think about big projects in the New 1:01:46.600 --> 1:01:50.000 York area like the Hudson Town those projects are so 1:01:50.160 --> 1:01:54.080 far out there. This is certainly helping us from a 1:01:54.080 --> 1:01:58.160 demand standpoint, demand generation standpoint. I mentioned that we've identified 1:01:58.200 --> 1:02:01.280 four thousand of those forty thousand projects so far. Maybe 1:02:01.400 --> 1:02:04.000 there'll be thousands more that will be funded, but that 1:02:04.080 --> 1:02:06.680 is that is a long long way away. I'm not 1:02:06.880 --> 1:02:10.320 thinking that far out. It's at least ten years, and 1:02:10.360 --> 1:02:13.520 who knows in ten years what's to come in terms 1:02:13.560 --> 1:02:17.720 of new projects that could be could be funded. There 1:02:17.800 --> 1:02:21.760 is again just such a lack of demand for this 1:02:21.920 --> 1:02:25.440 type of extended day lodging product, and that's what has 1:02:26.000 --> 1:02:29.520 our two hundred and seventy developers who have signed contracts 1:02:29.880 --> 1:02:33.120 and been wanted territories to build this type of lodging 1:02:33.320 --> 1:02:33.960 so excited. 1:02:34.120 --> 1:02:37.040 So you don't ever say the word right now recession 1:02:37.360 --> 1:02:39.120 based on what you're seeing. Is that fair? 1:02:39.520 --> 1:02:39.760 Well? 1:02:39.960 --> 1:02:45.680 Look, I mean, our brands have always outperformed any economic downturn. 1:02:46.080 --> 1:02:49.360 They did after nine to eleven, they certainly. 1:02:48.960 --> 1:02:53.720 Did during the eight and nine Great Financial Crisis, and 1:02:54.000 --> 1:02:57.880 there was no better outperformance in the industry than the 1:02:57.920 --> 1:03:01.600 economy and mid scale lodging brands of Wyndham hotels and 1:03:01.640 --> 1:03:03.360 resorts throughout COVID. 1:03:03.440 --> 1:03:05.640 Our brands were the very first to recover. 1:03:06.320 --> 1:03:10.560 Our brands are known as Days and by Windom, Super 1:03:10.560 --> 1:03:14.880 eight by Windom, Lakita by Windom, very large systems of 1:03:15.040 --> 1:03:19.080 thousands of units in this country that have great brand recognition, 1:03:19.600 --> 1:03:23.920 where franchisees never had to close their hotels because they 1:03:23.960 --> 1:03:27.160 were able to break even at thirty percent occupancy. 1:03:27.520 --> 1:03:31.240 Where while we're a leisure based company and seventy percent 1:03:31.280 --> 1:03:31.640 of our. 1:03:31.560 --> 1:03:34.480 Business is relying on the leisure travel demand, which is 1:03:34.520 --> 1:03:37.480 still points still out there, that thirty percent that is 1:03:37.560 --> 1:03:42.240 non leisure is that essential everyday worker whose office is 1:03:42.640 --> 1:03:45.760 not a downtown office building that's been closed as it 1:03:45.800 --> 1:03:49.480 was throughout COVID, but whose office is the front seat 1:03:50.040 --> 1:03:51.680 of their construction. 1:03:51.280 --> 1:03:55.360 Or utility vehicle, or is one of my traveling. 1:03:55.120 --> 1:03:59.480 Nurse daughters who have to go to work that are 1:04:00.360 --> 1:04:03.840 in need accommodation during the week. Again, our brands have 1:04:04.520 --> 1:04:10.120 always outperformed in economic downturms. We're not seeing a recession 1:04:10.240 --> 1:04:12.920 to your point right now, and we're feeling very confident 1:04:14.120 --> 1:04:15.000 about the year ahead. 1:04:15.360 --> 1:04:19.600 Jeff, just remind everyone of Wyndom Hotels and Resorts business 1:04:19.680 --> 1:04:23.560 model are you one hundred percent franchise owned and operated 1:04:23.840 --> 1:04:26.360 i e. You guys actually don't own and operate any 1:04:26.440 --> 1:04:31.080 of the Windom resorts and hotels that people see exactly. 1:04:30.760 --> 1:04:33.200 Tim And that's what investors wanted to see when we 1:04:33.280 --> 1:04:35.960 went public five six years ago. They wanted to see 1:04:35.960 --> 1:04:38.480 a company that got out of the ownership game. We 1:04:38.560 --> 1:04:40.560 had to own hotels at that point in time, out 1:04:40.600 --> 1:04:42.280 of the management game, which we have. We are a 1:04:42.280 --> 1:04:46.000 one hundred percent franchise company. We're the world's largest hotel 1:04:46.040 --> 1:04:49.760 franchise company. We franchise about six thousand hotels here in 1:04:49.760 --> 1:04:52.960 the United States and another three thousand, two hundred and 1:04:53.080 --> 1:04:54.439 ninety five countries around the world. 1:04:54.840 --> 1:04:58.640 So it's it's it's less risky, right, oh, completely. 1:04:58.720 --> 1:05:01.640 You know, our business model is is extremely resilient. 1:05:02.320 --> 1:05:05.480 As we were talking about in the periods of downturns, 1:05:05.560 --> 1:05:08.600 we've actually been able to even in periods we're revenue 1:05:08.600 --> 1:05:12.720 per available room might generate more earnings for investors. We 1:05:12.760 --> 1:05:14.320 have we have many levers to pull. 1:05:14.640 --> 1:05:16.480 One thing I'm curious about and the levers, like you 1:05:16.560 --> 1:05:18.680 have lots of different brands and you hit at different 1:05:18.920 --> 1:05:24.360 you know, economic individuals or families or consumers, So I 1:05:24.520 --> 1:05:26.280 am curious about you know, I was looking at some 1:05:26.360 --> 1:05:29.440 of the bi research our our team does, and it 1:05:29.520 --> 1:05:32.440 talked about your US room base, including a larger percentage 1:05:32.480 --> 1:05:35.360 of lower price economy hotels and other lodging companies. You 1:05:35.520 --> 1:05:39.920 did though by American, American Inn and Lacinta la quinta 1:05:39.960 --> 1:05:44.880 excuse me, and that he like he dies. Sorry, sorry, 1:05:45.000 --> 1:05:47.840 You're right that that really helped boost your mid scale 1:05:47.840 --> 1:05:50.360 and upper mid scale presence UH and fee exposure. But 1:05:50.520 --> 1:05:53.240 I do wonder that you do have some exposure if 1:05:53.240 --> 1:05:58.760 there's a downturn, an economic downturn. So you sound upbeat. 1:05:59.000 --> 1:06:02.000 We talked about that before, but there is some exposure, 1:06:02.120 --> 1:06:06.280 right if especially the lower income consumer who continues to 1:06:06.360 --> 1:06:08.040 be squeezed, and we talk about that a lot here 1:06:08.080 --> 1:06:08.640 at Bloomberg. 1:06:08.880 --> 1:06:10.600 I think one of the biggest miss numbers is that 1:06:10.880 --> 1:06:15.960 our guest is low income. It is squarely middle class. 1:06:16.400 --> 1:06:18.640 When you look at the demographics of our guests, and 1:06:18.720 --> 1:06:23.400 those middle class income Americans who are staying at Thank 1:06:23.440 --> 1:06:26.760 You American or Lakita or Days In or Super eight 1:06:27.360 --> 1:06:32.240 are feeling better about life today than they were, certainly 1:06:32.240 --> 1:06:35.480 in the middle of COVID or pre COVID levels, and 1:06:35.840 --> 1:06:39.800 the consumer sentiment that we're seeing continues to improve. 1:06:40.080 --> 1:06:42.480 We look at many leading indicators. 1:06:42.000 --> 1:06:44.760 In terms of how we believe the consumer is feeling. 1:06:45.520 --> 1:06:50.720 Bookie windows continue to increase. People have reprioritized their vacations 1:06:50.760 --> 1:06:53.080 as to the very top of the list. They want 1:06:53.200 --> 1:06:58.320 to spend their disposable income on vacations more than on 1:06:58.520 --> 1:07:04.480 any other consumer spending. We're seeing longer lengths of day 1:07:04.640 --> 1:07:08.360 and certainly the ability for so many of our consumers 1:07:08.480 --> 1:07:12.000 to work remotely on a Monday and Friday is helping 1:07:12.160 --> 1:07:17.000 drive that trend. And we're seeing demand can continue to 1:07:17.040 --> 1:07:20.400 pick up after the normalization of that revenge travel that 1:07:20.560 --> 1:07:25.120 we all knew had to normalize. So we're seeing the 1:07:25.200 --> 1:07:29.640 start of we're not we're heading towards obviously Labor Day, 1:07:30.000 --> 1:07:31.080 but Memorial. 1:07:30.760 --> 1:07:31.640 Day was very strong. 1:07:31.680 --> 1:07:34.160 It was up four percent versus last Memorial Day here 1:07:34.160 --> 1:07:37.560 in the United States. July fourth, Triple A reported was 1:07:37.640 --> 1:07:40.600 up eight percent versus where it was versus last July 1:07:40.800 --> 1:07:45.280 for and we're expecting the same for Labor Day. So 1:07:45.480 --> 1:07:49.000 these middle income Americans want to travel. The number one 1:07:49.160 --> 1:07:52.440 preference for vacations in the United States of America is 1:07:52.560 --> 1:07:56.760 drived to, and ninety percent of our business is drived to. 1:07:57.560 --> 1:08:02.040 And these middle income travelers are with unemployment where it is, 1:08:02.120 --> 1:08:04.200 as we all know, more employed than they were, yeah, 1:08:04.440 --> 1:08:07.600 and most more savings in their bank accounts than they 1:08:07.680 --> 1:08:08.360 did pre COVID. 1:08:08.440 --> 1:08:12.160 So Jeff, help us understand. Help help us understand the segmentation, 1:08:12.520 --> 1:08:15.360 because Echo is for the you know, economy traveler, that's 1:08:15.360 --> 1:08:17.080 where where you are right. 1:08:17.000 --> 1:08:20.200 Now, and the economy business travel. 1:08:20.000 --> 1:08:24.040 Economy, business travel, okay, where really blue collar water Walk 1:08:25.320 --> 1:08:28.640 water Walk is upscale, more upscale, and then you have 1:08:28.680 --> 1:08:30.639 Hawthorn and mid scale. Give us sort of the price 1:08:30.720 --> 1:08:32.559 point for Echo versus water. 1:08:32.439 --> 1:08:36.879 Walk, Yeah, I mean price points look obviously are determined 1:08:36.920 --> 1:08:39.680 by the markets and the location they're they're in. But 1:08:40.560 --> 1:08:43.240 the Hope guests room I'm in tonight, we'll be checking 1:08:43.280 --> 1:08:46.000 guests in at an eighty dollars price point that water 1:08:46.160 --> 1:08:49.360 Walk average daily right might could be depending on the 1:08:49.439 --> 1:08:52.560 market double that. And sure we have but we have 1:08:52.720 --> 1:08:56.720 lots of aspirational Windoms, Windom Grands Skultcha. 1:08:57.280 --> 1:08:59.400 We have a new luxury brand. 1:09:00.080 --> 1:09:03.519 The Registry Collection, which might have a three or four 1:09:03.640 --> 1:09:07.920 hundred dollars handle to its average daily rate. But for 1:09:08.400 --> 1:09:11.679 that blue collar traveler who's staying at an Echo suites, 1:09:12.560 --> 1:09:15.320 it is by and large often being paid for by 1:09:15.800 --> 1:09:17.320 obviously their their employer. 1:09:17.960 --> 1:09:21.479 And also the demand for this type of product is 1:09:21.520 --> 1:09:25.960 being driven by how much transient motion there is out 1:09:26.000 --> 1:09:27.960 there in our country. 1:09:27.880 --> 1:09:31.320 For people looking for short term and meetium term and 1:09:31.400 --> 1:09:34.680 long term accommodations on the relocation front, given an act 1:09:34.720 --> 1:09:36.080 of housing in this country. 1:09:36.240 --> 1:09:37.840 Hey, one thing I want to do. What's cool is 1:09:38.000 --> 1:09:41.160 you guys are global your second quarter rev par so 1:09:41.240 --> 1:09:43.640 we're talking about revenue per available rooms, so key when 1:09:43.680 --> 1:09:46.880 we're talking about anybody in the hospitality industry. Second quarter 1:09:47.000 --> 1:09:49.080 red par was flat for the US, down two percent 1:09:49.200 --> 1:09:52.880 for economy, hotels up seven percent internationally, and you had 1:09:52.920 --> 1:09:55.519 a thirty seven percent gain in Latin America and fifteen 1:09:55.560 --> 1:09:58.800 percent in Europe and Middle East Africa. What can you 1:09:58.840 --> 1:10:01.160 tell us about kind of the globe lobo economy based 1:10:01.200 --> 1:10:02.560 on what you guys are seeing. 1:10:02.680 --> 1:10:06.040 The biggest trend for all of the lodging companies out 1:10:06.080 --> 1:10:09.080 there for the next quarter, the quarter ahead, and the 1:10:09.120 --> 1:10:11.760 year ahead is still there is a lot of occupancy 1:10:12.360 --> 1:10:16.880 still left to recover the occupancy tailwind really around the 1:10:17.000 --> 1:10:21.080 world with very few exceptions country by country still has 1:10:21.200 --> 1:10:23.720 room to grow, and so yes, international it was a 1:10:23.800 --> 1:10:24.519 big bright. 1:10:24.400 --> 1:10:25.120 Spot for US. 1:10:25.200 --> 1:10:28.200 Our international red park revenue per available room was up 1:10:28.280 --> 1:10:31.280 seven percent in the quarter versus the same time last year. 1:10:31.680 --> 1:10:34.720 And here where things normalized. Economy, as you pointed out, 1:10:35.439 --> 1:10:37.600 was down, but it was improving from where it was 1:10:37.840 --> 1:10:40.400 last year. Is things normalized and it was up in 1:10:41.120 --> 1:10:45.240 some of the other segments. There's great pricing power out there, Carol. 1:10:45.320 --> 1:10:51.360 I always remind investors that that pricing still hasn't caught 1:10:51.439 --> 1:10:53.280 up in the lodging industry to inflation. 1:10:53.400 --> 1:10:56.000 I think inflation's up something like twenty three to twenty 1:10:56.080 --> 1:10:57.599 four percent pre. 1:10:57.600 --> 1:11:00.800 COVID days, and our average daily rate is up over 1:11:01.080 --> 1:11:05.680 only seventeen percent. Our hotels are operated by small, mom 1:11:05.800 --> 1:11:10.880 and pop business owners who feel very confident about holding 1:11:10.920 --> 1:11:14.120 on to that advertrate the game during COVID and continuing 1:11:14.520 --> 1:11:16.760 to improve it, but at the same time building the 1:11:16.880 --> 1:11:20.080 business base of business on the book with a business 1:11:20.160 --> 1:11:23.000 transient that allows them in periods of demand to price up. 1:11:23.320 --> 1:11:25.400 Jeff, great to check in with. You really appreciate it. 1:11:25.479 --> 1:11:29.080 Jeff Blotti. He's the president CEO of Wyndom hotels and resorts, 1:11:29.160 --> 1:11:31.559 joining us from Play No Texas Jeff b. While you're 1:11:31.600 --> 1:11:33.439 listening and watching Bloomberg Business Week. 1:11:35.640 --> 1:11:39.120 You're listening to the Bloomberg Business Week podcast. Catch us 1:11:39.200 --> 1:11:42.400 live weekday afternoons from two to five pm Eastern Listen 1:11:42.479 --> 1:11:44.640 on Apple car Play and then Brought Auto with a 1:11:44.640 --> 1:11:47.639 Bloomberg Business app or watch us live on YouTube. 1:11:48.640 --> 1:11:51.880 Fittit car collectors downshifting their spending. The c suite, drink 1:11:51.920 --> 1:11:54.840 of choice and marble tiled floor spread out like flower 1:11:54.960 --> 1:11:58.080 pedals while painted vines cascade from the ceiling over a 1:11:58.160 --> 1:12:01.040 glowing circular sinc. Yes, it's all in a bathroom, the 1:12:01.080 --> 1:12:04.120 perfect setting for a selfie. Yeah, all right, you're gonna 1:12:04.160 --> 1:12:06.839 find out about why. Yes, it's time for Bloomberg Pursuits 1:12:06.840 --> 1:12:10.320 and with us as the editor of Pursuits, Chris Rouser, Yeah, 1:12:10.560 --> 1:12:13.479 we got to start with this whole idea of selfiees. 1:12:14.040 --> 1:12:15.560 Carol, didn't you know? 1:12:16.080 --> 1:12:18.720 Didn't you know that the most important room in a 1:12:18.800 --> 1:12:22.320 restaurant these days is the bathroom? How did to explain? 1:12:22.439 --> 1:12:22.839 Explain? 1:12:22.960 --> 1:12:23.280 Please? 1:12:23.760 --> 1:12:27.040 Well, it's actually a crazy story. So Kate creator are 1:12:27.040 --> 1:12:30.080 amazing food editor in London, pitched this story. 1:12:30.320 --> 1:12:35.400 And were you like, did y'all know Okay, yes, she. 1:12:35.479 --> 1:12:38.080 And I always have this. My like number one bugaboo 1:12:38.120 --> 1:12:40.240 is when a restaurant bathroom doesn't have like an occupied 1:12:40.360 --> 1:12:42.360 vacant signal on it and you have to knock and 1:12:42.400 --> 1:12:45.360 then you can't hear anyway. So I like, we talk 1:12:45.400 --> 1:12:48.720 about restaurant bathrooms laws. And now that Instagram is such 1:12:48.720 --> 1:12:52.080 a big part of restaurant's success, and they're marketing because 1:12:52.080 --> 1:12:54.120 people take food selfies. They do the lighting in the 1:12:54.200 --> 1:12:57.120 restaurant so the food looks good in pictures. It obviously 1:12:57.280 --> 1:12:59.920 extended to Okay, people are in the bathroom, they take 1:13:00.120 --> 1:13:02.760 selfies in the mirror. The bathroom is actually a place 1:13:02.800 --> 1:13:05.160 where you can, for not a lot of money, express 1:13:05.800 --> 1:13:08.920 your design sensibility and your care for every small detail. 1:13:09.240 --> 1:13:13.599 So suddenly bathrooms are looking very cool and very shareable. 1:13:13.720 --> 1:13:18.320 And so David Rockwell, who is a very famous architect 1:13:18.320 --> 1:13:19.960 and he does restaurants and hotels and all sorts of 1:13:20.000 --> 1:13:23.400 cool stuff Broadway shows. A couple of years ago, he 1:13:23.520 --> 1:13:25.960 did a story with us where during the pandemic, he 1:13:26.120 --> 1:13:29.000 was like, we need to envision the restaurant of the future, 1:13:29.160 --> 1:13:33.120 Like what will restaurants be like now that you know, 1:13:33.160 --> 1:13:35.040 maybe we need to use outdoor spaces, maybe they need 1:13:35.120 --> 1:13:37.080 to sort of work more like twenty four hours a 1:13:37.160 --> 1:13:37.840 day rather than. 1:13:37.840 --> 1:13:38.400 Just at dinner. 1:13:38.840 --> 1:13:41.240 And one of his ideas in this schematic of our 1:13:41.280 --> 1:13:43.599 restaurant of the future was you walk into the restaurant 1:13:43.640 --> 1:13:45.720 and there's a hand washing station, Like the bathroom is 1:13:45.800 --> 1:13:49.280 kind of the first thing that you get to. So 1:13:49.400 --> 1:13:51.000 that was like an idea that we ran in Bloomba. 1:13:51.080 --> 1:13:53.000 I'm sorry, I do like that because, like some especially 1:13:53.000 --> 1:13:54.400 in the city, right, you just feel like you just 1:13:54.400 --> 1:13:55.720 walk outside a little bit and you're like, I want 1:13:55.760 --> 1:13:56.040 to wash. 1:13:56.439 --> 1:13:58.760 So now, when you get into Kogodoc, which is one 1:13:58.800 --> 1:14:01.559 of the most fabulous restaurants in New York City, it's 1:14:01.880 --> 1:14:03.679 so so cool you can't get in. It's this fried 1:14:03.800 --> 1:14:06.880 Korean chicken and champagne restaurant. The first thing that you 1:14:07.000 --> 1:14:09.479 see when you walk in is a hand washing station 1:14:09.880 --> 1:14:12.799 and it's got like Mez soaps, and it's very fancy, 1:14:12.920 --> 1:14:16.439 and it's got these great lighting mirrors for like selfies. Stunning, 1:14:16.520 --> 1:14:18.840 and that idea came from like working with us on 1:14:18.960 --> 1:14:22.240 that pursuit story and it's very cool. And anyway, all 1:14:22.320 --> 1:14:26.320 over the Europe the US Basstroum bathrooms are becoming very 1:14:26.560 --> 1:14:27.760 trendy and very share Yeah. 1:14:27.760 --> 1:14:30.040 It's not just a New York thing, right, It's like 1:14:30.160 --> 1:14:31.800 all over the place. First of all, though, you have 1:14:31.920 --> 1:14:33.880 to remind everybody, for those of you out there listening 1:14:33.960 --> 1:14:36.439 who want to do your own bathroom selfie, I mean 1:14:37.000 --> 1:14:39.160 how many I mean tons of people have done this, 1:14:39.479 --> 1:14:40.160 like millions. 1:14:40.400 --> 1:14:44.120 Oh yeah, I mean we yes, nine million bathroom shell 1:14:44.439 --> 1:14:48.760 hashtag bathroom selfie hashtags have been shared. We you know, 1:14:48.840 --> 1:14:51.880 there's one of our colleagues was in Georgia, Straccheria and 1:14:52.000 --> 1:14:54.559 Munich and sent me pictures of this disco ball bathroom. 1:14:54.800 --> 1:14:59.080 There's a roller rink slash restaurant in Brooklyn, of course, 1:14:59.160 --> 1:15:00.839 that has a DJ in the bathroom. 1:15:01.160 --> 1:15:02.360 It's called Club Flush. 1:15:03.200 --> 1:15:07.680 So listen, the DNC used a DJ like for the 1:15:07.760 --> 1:15:11.920 roll Call. Apparently DJs are finding themselves everywhere, all right. 1:15:12.000 --> 1:15:14.479 For executives who often travel around the globe, they have 1:15:14.520 --> 1:15:18.280 busy days. CEOs, you know, just like the rest of us, 1:15:18.320 --> 1:15:19.559 they've got unwind after work. 1:15:19.960 --> 1:15:20.160 Yeah. 1:15:20.240 --> 1:15:24.120 So in every issue of Business Week every month, we 1:15:24.280 --> 1:15:26.360 do a CEO diet where we ask a bunch of 1:15:26.479 --> 1:15:29.439 CEOs what they do for exercise, what they were to work, 1:15:29.479 --> 1:15:31.800 what they eat for breakfast, which we've talked about, and 1:15:31.880 --> 1:15:35.760 so this month we ask them what is their signature drink, like, 1:15:35.840 --> 1:15:37.800 what's their go to? And you know, I got to say, 1:15:37.880 --> 1:15:39.000 it's a lot of martinis. 1:15:39.479 --> 1:15:40.000 We got a lot. 1:15:40.120 --> 1:15:42.400 We couldn't run all the answers that we got people 1:15:42.439 --> 1:15:44.800 you couldn't be working. A lot of them were dirty martinis. 1:15:45.320 --> 1:15:48.560 But Jen Hymen, who's the Rent the Runway founder, she 1:15:49.720 --> 1:15:51.560 was like, you know, I love a spicy margarita, but 1:15:51.680 --> 1:15:54.559 on a cold, cozy Brooklyn day, I love a mescal 1:15:54.640 --> 1:15:56.760 and the groni and a groaning with mescal, which I 1:15:56.800 --> 1:15:57.320 think is great. 1:15:57.520 --> 1:15:57.760 Yeah. 1:15:59.000 --> 1:16:01.400 And we got some apparel sprits. 1:16:01.120 --> 1:16:03.320 Is uh aperol sprits? 1:16:03.439 --> 1:16:03.639 Yes? 1:16:03.760 --> 1:16:03.960 Yeah? 1:16:04.840 --> 1:16:06.400 And can I just say there was a lot of 1:16:06.479 --> 1:16:10.040 non alcoholic too the beverages, which I thought was interesting 1:16:10.439 --> 1:16:12.680 that did not Tim if Tim was here, because he's 1:16:12.720 --> 1:16:14.200 a huge non alcoholic dude. 1:16:14.280 --> 1:16:14.479 Yeah. 1:16:15.280 --> 1:16:17.880 Yeah, sort of like neotropic kind of drinks strengths that 1:16:17.920 --> 1:16:20.040 are sort of wellness oriented and have no alcohol. That 1:16:20.160 --> 1:16:20.879 was also popular. 1:16:21.080 --> 1:16:24.640 Yeah, exactly, kind of interesting. I really feel like, all right, 1:16:25.600 --> 1:16:28.439 can we get to you're a watch person, I mean 1:16:28.479 --> 1:16:31.799 you're you're a person of many interests, but I love watches. 1:16:32.160 --> 1:16:32.479 You love. 1:16:32.840 --> 1:16:34.760 This was just kind of a fun story. I do this, 1:16:34.920 --> 1:16:36.519 like I don't know about you. I've come off a 1:16:36.560 --> 1:16:38.240 plane and I see somebody wearing something in that like 1:16:38.320 --> 1:16:39.960 Alex stalk them like, hey, where'd you get that? 1:16:40.160 --> 1:16:42.400 Yeah, I'm the same. I will walk up to anybody 1:16:42.439 --> 1:16:43.360 and ask them about their watch. 1:16:43.439 --> 1:16:43.600 I know. 1:16:44.360 --> 1:16:45.760 And so for my watch. 1:16:46.040 --> 1:16:48.400 So I have a watch club, which is we do 1:16:48.680 --> 1:16:50.280 We have a newsletter and we have events and if 1:16:50.320 --> 1:16:52.439 you're a Bloomberg subscriber, you can be in our watch club. 1:16:52.880 --> 1:16:54.519 And so what do you do? 1:16:54.680 --> 1:16:55.320 Like, what do you like? 1:16:55.400 --> 1:16:57.120 Who do you contact or how do you reach out 1:16:57.120 --> 1:16:57.240 to you? 1:16:57.800 --> 1:16:58.240 No idea. 1:16:58.600 --> 1:17:01.600 There's a way if you google it, So we're going 1:17:01.680 --> 1:17:04.240 to do it. It's if you go to Bloomberg dot 1:17:04.320 --> 1:17:08.320 com slash accounts, slash newsletters, you'll see it, okay, or 1:17:08.400 --> 1:17:09.759 just Bloomberg dot com slash newsletters. 1:17:09.800 --> 1:17:10.280 I can't see it. 1:17:10.320 --> 1:17:14.519 But anyway, I was walking around and in summer, there's 1:17:14.560 --> 1:17:17.559 not a lot of new watches. Actually, because Europe goes 1:17:17.600 --> 1:17:20.120 on vacation, there's not a lot of new debuts. So 1:17:20.240 --> 1:17:21.880 I was kind of looking out for the watches that 1:17:21.960 --> 1:17:23.920 were in the wild, and I saw some really really 1:17:24.000 --> 1:17:27.800 cool ones walking around this neighborhood in New Manhattan. But 1:17:27.880 --> 1:17:30.240 also I ran into a guy who had a nineteen 1:17:30.280 --> 1:17:33.759 twenties Rolex on the on the boardwalk and Fire Island, 1:17:34.439 --> 1:17:37.320 and I he found it and he restored it, and 1:17:37.400 --> 1:17:39.360 I put it in the newsletter. My friends from Rolex 1:17:39.439 --> 1:17:42.000 were like, we've never even seen this watch. 1:17:42.120 --> 1:17:42.840 It's so cool. 1:17:43.080 --> 1:17:46.080 And the surprising watches also extended to the Olympics, where 1:17:46.120 --> 1:17:50.080 there were a crazy amount of watches. People running doing sprints, 1:17:50.400 --> 1:17:52.519 like competing in one hundred and eighty five thousand dollars. 1:17:52.520 --> 1:17:56.599 Reshard Meal watches. The guy who won the pole who 1:17:56.720 --> 1:18:00.040 like set the world record for pole vaulting arm and 1:18:00.439 --> 1:18:03.240 duplantis he broke his own record. He's broken his own 1:18:03.240 --> 1:18:06.599 record nine times. He was wearing a new Omega watch. 1:18:06.640 --> 1:18:09.000 Like Omega hadn't debuted this watch yet, and they're the 1:18:09.040 --> 1:18:10.920 way they debuted it was they put it on his 1:18:11.040 --> 1:18:13.320 wrist as he won the gold medal at the Olympics. 1:18:13.439 --> 1:18:16.000 First of all, why are you wearing anything extra? I 1:18:16.040 --> 1:18:19.960 don't care anybody, I don't care slow you down. And 1:18:20.040 --> 1:18:22.679 you know it's interesting so LVMH was like the sponsor 1:18:22.760 --> 1:18:24.840 of the Olympics in France, and there was a lot 1:18:24.920 --> 1:18:28.080 of like LVMH brands, and so the other brands mostly 1:18:28.120 --> 1:18:30.040 were like, this isn't our time. First of all, the 1:18:30.040 --> 1:18:33.760 Olympics is usually like a non sponsored event, right it 1:18:33.880 --> 1:18:36.640 used to be. And but some brands like Omega and 1:18:36.720 --> 1:18:41.720 Risharmeal were not afraid and they put their watches on Olympics, 1:18:42.680 --> 1:18:44.559 on Olympians in competition, which is crazy. 1:18:44.640 --> 1:18:46.720 I mean that's like killer advertising. 1:18:46.880 --> 1:18:48.840 I mean you couldn't I couldn't believe it when I 1:18:48.960 --> 1:18:50.320 watched it live with my daughter and I was like, 1:18:50.360 --> 1:18:51.720 oh my god, he's wearing a watch. I wonder what 1:18:51.840 --> 1:18:52.280 that watches. 1:18:52.400 --> 1:18:55.400 It's unbelievable. Hey, listen, just we're going to transition because 1:18:55.479 --> 1:18:57.040 I want to talk about a story that Hannah did 1:18:57.120 --> 1:18:59.200 Hannah Elliott real quickly though. There were some news this 1:18:59.240 --> 1:19:03.000 week about selbuying a minority steak in the Swiss watch 1:19:03.120 --> 1:19:04.560 brand n B and F. 1:19:04.680 --> 1:19:07.880 You know this brand, Yes, So Chanelle makes great watches, 1:19:07.920 --> 1:19:09.639 and not everyone knows that because you think of them 1:19:09.680 --> 1:19:12.880 as so they're leather goods their fashion, but they also 1:19:12.920 --> 1:19:15.720 have a great watch making tradition and to sort of 1:19:15.800 --> 1:19:18.800 improve their legacy in that field and their authority. They 1:19:18.840 --> 1:19:21.600 bought a twenty five percent steak in MB and F, 1:19:21.760 --> 1:19:25.080 which is a very cool, very avant garde watchman. They 1:19:25.160 --> 1:19:27.320 only make like four hundred, five hundred watches a year. 1:19:27.360 --> 1:19:30.680 They're really expensive. I own one that it was not 1:19:30.880 --> 1:19:32.360 really expensive that I entered a lot lot. 1:19:32.439 --> 1:19:33.639 We do into Chris's lives. 1:19:33.800 --> 1:19:35.599 I entered a lottery to be able to buy one 1:19:35.600 --> 1:19:37.720 of these watches because they're so they're like spaceships. We've 1:19:37.720 --> 1:19:40.960 talked about them before. They're really really crazy and I 1:19:41.080 --> 1:19:43.600 got their lowest price one and I only wear it 1:19:43.640 --> 1:19:46.920 on special occasions. But it's it's interesting that Chanelle. 1:19:46.640 --> 1:19:48.599 Dies see and just look at it and glaze her 1:19:48.680 --> 1:19:52.400 groove lands at it all right. Speaking of things that 1:19:52.520 --> 1:19:55.320 often have high prices though, vintage car sales, and we 1:19:55.360 --> 1:19:59.040 want to bring in kind of Elliott, who covers all 1:19:59.080 --> 1:20:01.879 things auto for us. She's our autocolumnist here at Pursuits. 1:20:01.920 --> 1:20:04.680 You're a member of your team. Yes, hey, Hanna, good 1:20:04.720 --> 1:20:08.080 to have you here. Tell us about the recent auctions 1:20:08.120 --> 1:20:10.400 at Monterey because it sounds like I love the headline 1:20:10.439 --> 1:20:13.880 on this vintage car sales getting freezer burn, what happened, 1:20:13.920 --> 1:20:16.680 and tell us about the environment, like who's there, what 1:20:16.880 --> 1:20:18.880 you usually see, and how it went down. 1:20:19.240 --> 1:20:23.080 You know, it was a really interesting year this year 1:20:23.920 --> 1:20:29.639 at the auctions week long totals clothes around three hundred 1:20:29.640 --> 1:20:33.680 and seventy million dollars across five auction houses, and that 1:20:33.960 --> 1:20:38.120 was down about eight percent from twenty twenty three. And 1:20:38.280 --> 1:20:41.519 it was well off, you know, like just after COVID 1:20:41.600 --> 1:20:44.400 and twenty twenty one and twenty two the auction numbers 1:20:44.439 --> 1:20:47.360 were like way up above four hundred and fifty million dollars. 1:20:47.439 --> 1:20:53.120 So it things are down, and that freezer burn term 1:20:53.320 --> 1:20:56.920 is really interesting. One of my sources used it because 1:20:57.200 --> 1:21:01.000 he was describing sort of the gloss of cars for 1:21:01.320 --> 1:21:05.720 sale that had already been for sale and had just 1:21:05.880 --> 1:21:09.599 sort of been defrosted and like let's try it again 1:21:09.760 --> 1:21:14.519 because they hadn't sold. And that kind of describes this 1:21:14.840 --> 1:21:17.720 market we're in right now, which is there are a 1:21:17.960 --> 1:21:21.920 lot of good cars out there and maybe too many 1:21:22.080 --> 1:21:27.639 good cars right now for how willing collectors are to buy. 1:21:29.160 --> 1:21:32.519 So you asked about what kind of people are at 1:21:32.560 --> 1:21:35.599 the auctions now. Of course, this is Monterey Car Week, 1:21:35.640 --> 1:21:37.960 This is like the Olympics of the car world that 1:21:38.120 --> 1:21:43.960 happened every August, and it's really it's global collectors. It's 1:21:44.240 --> 1:21:47.800 a lot of of course, we're talking vintage cars, but also, 1:21:48.000 --> 1:21:51.360 you know, vintage now includes cars from the nineties and 1:21:51.439 --> 1:21:54.719 two thousands, which kind of pays me to say because 1:21:54.960 --> 1:22:00.280 I'm a nineties child. But shows are considered vintage too now. 1:22:00.520 --> 1:22:03.840 So we have people buying, of course the old racing 1:22:03.960 --> 1:22:07.479 Ferraris and old world Royces and Alpha Romeos, but we 1:22:07.560 --> 1:22:10.920 also have people buying like Lamborghinis from the nineties and 1:22:10.960 --> 1:22:12.080 two thousands. 1:22:12.840 --> 1:22:13.559 So it's a mix. 1:22:14.040 --> 1:22:18.760 And what we saw was, yeah, maybe it's a I 1:22:18.800 --> 1:22:20.799 don't know what to say. No one was saying panic, 1:22:21.120 --> 1:22:22.760 but it's things are slowing down. 1:22:22.880 --> 1:22:27.200 It's an interesting time in this collectibles market across categories 1:22:27.240 --> 1:22:30.800 actually watches too, and and art obviously, and Hannah talked 1:22:30.800 --> 1:22:35.439 about this on her great podcast Hot Pursuit. People don't 1:22:35.479 --> 1:22:38.200 know what's going to happen with interest rates. Maybe now 1:22:38.240 --> 1:22:40.439 it's not the time. You know, even very very rich 1:22:40.479 --> 1:22:42.600 people are affected by interest rates when it comes to 1:22:42.680 --> 1:22:45.799 real estate and buying art and just lend it, borrowing 1:22:46.000 --> 1:22:48.920 and the way their money moves. And also people don't 1:22:48.960 --> 1:22:51.720 know what's going to happen after the election, and you know, 1:22:51.840 --> 1:22:53.360 like where are you going to put Hannah, I mean 1:22:53.400 --> 1:22:55.599 this point, like where are you gonna where're gonna put 1:22:55.600 --> 1:22:57.400 your money? What's what's the world going to look like 1:22:57.520 --> 1:23:00.880 where you're gonna live. Yeah, So it's a strange time 1:23:01.040 --> 1:23:04.000 at that high end of this collectibles market for sure. 1:23:05.080 --> 1:23:05.320 Yeah. 1:23:05.479 --> 1:23:09.560 And I would also say for cars too, just the 1:23:09.720 --> 1:23:14.160 geopolitical climate in Europe, does it affects how things are 1:23:14.240 --> 1:23:17.160 moving in Europe and there is a trickle down effect 1:23:17.200 --> 1:23:20.080 to how things are moving in the US. For instance, 1:23:20.360 --> 1:23:22.920 some of these cars, some of the big you know 1:23:23.120 --> 1:23:26.479 Ferraris and Alpha Romeos, those are actually cars that have 1:23:26.760 --> 1:23:29.280 lived most of their life in Europe. And if things 1:23:29.320 --> 1:23:32.360 aren't really moving right now in Europe because of obvious reasons, 1:23:32.400 --> 1:23:35.439 we've got some wars happening, that does have a trickle 1:23:35.479 --> 1:23:37.960 down effect to some of the sales in the US too. 1:23:38.320 --> 1:23:40.080 I really love too that you get into how it's 1:23:40.160 --> 1:23:43.040 kind of a transitional market for cars. I guess, you know, 1:23:43.080 --> 1:23:45.600 the really old, great vintage cars from the fifties and 1:23:45.600 --> 1:23:48.240 the sixties, but that some of the newer stuff actually 1:23:48.800 --> 1:23:51.280 is what is selling Is that kind of a fair takeaway. 1:23:51.840 --> 1:23:56.080 Yeah, that's a really fair takeaway. It's been really interesting 1:23:56.160 --> 1:23:58.760 to see. You know, we all remember when, you know, 1:23:58.840 --> 1:24:02.160 the air cooled porches on the sixties were quite hot 1:24:02.360 --> 1:24:06.240 a several years ago in particular, and even those are 1:24:06.320 --> 1:24:09.639 cooling off a little bit in favor of this new 1:24:09.760 --> 1:24:16.720 generation of buyer who wants something a little more drivable. 1:24:17.200 --> 1:24:20.040 Dare I say, something a little bit more modern? And 1:24:20.560 --> 1:24:23.200 you know, if you were a kid in the nineties, yeah, 1:24:23.280 --> 1:24:26.479 the poster on your wall was like maybe a Ferrari 1:24:26.640 --> 1:24:31.840 F fifty or maybe a Lamborghini Diablo. It wasn't an 1:24:31.920 --> 1:24:36.240 air cooled Portie or a Corvette or a Ferrari from 1:24:36.280 --> 1:24:38.800 the fifties. It was you know, you were lessing after 1:24:39.800 --> 1:24:44.760 the Italian exotics. So yeah, we are really right different. 1:24:45.840 --> 1:24:46.360 Oh my god. 1:24:46.600 --> 1:24:48.519 Well, you can read all about the specifics and what 1:24:48.800 --> 1:24:50.800 what did sell to in some of the numbers and 1:24:50.920 --> 1:24:53.880 go really through it. Just check out Hannah's column. You 1:24:53.960 --> 1:24:55.960 can find it on the Bloomberg and also Bloomberg dot 1:24:56.000 --> 1:24:58.879 com or thanks to Bloomberg News. Auto columnist Hannah Elliott 1:24:59.280 --> 1:25:02.840 also co hosts of the podcast Hot Pursuit and the 1:25:03.080 --> 1:25:06.000 editor of Bloomberg Pursuits as always our Chris Rouser, and 1:25:06.040 --> 1:25:08.080 that wraps up the weekend edition of Bloomberg Business Week 1:25:08.120 --> 1:25:10.240 from Bloomberg Radio. Thank you so much for joining us. 1:25:10.600 --> 1:25:12.760 And a quick programming note. If you're listening to us 1:25:12.800 --> 1:25:15.160 in Boston, our new home starting September third will be 1:25:15.240 --> 1:25:18.080 ninety two nine FM. That's the day after Labor Day. 1:25:18.200 --> 1:25:20.800 Once again, Bloomberg Radio moving to ninety two nine FM 1:25:20.880 --> 1:25:23.600 in Boston. I'm Carol Masser along with Tim Stanovick. Have 1:25:23.640 --> 1:25:25.160 a great and safe weekend everyone. 1:25:25.520 --> 1:25:30.120 This is the Bloomberg Business Week podcast. Avail little on Apple, Spotify, 1:25:30.280 --> 1:25:34.000 and anywhere else you get your podcast. Listen live weekday 1:25:34.000 --> 1:25:37.479 afternoons from two to five pm Eastern on Bloomberg dot Com, 1:25:37.680 --> 1:25:40.960 the iHeartRadio app, tune In, and the Bloomberg Business App. 1:25:41.040 --> 1:25:43.960 You can also watch us live every weekday on YouTube 1:25:44.240 --> 1:25:46.200 and always on the Bloomberg terminal