WEBVTT - Bloomberg Businessweek Weekend - August 18th, 2023 0:00:01.360 --> 0:00:05.720 This is Bloomberg business Week inside from the reporters and 0:00:05.880 --> 0:00:09.760 editors who bring you America's most trusted business magazine, plus. 0:00:09.520 --> 0:00:12.039 Global business, finance and tech news. 0:00:12.200 --> 0:00:16.279 The Bloomberg Business Week Podcast with Carol Messer and Tim 0:00:16.320 --> 0:00:18.640 Stenebek from Bloomberg Radio. 0:00:19.760 --> 0:00:22.520 Hi, everyone, Welcome to the weekend edition of Bloomberg Business Week. 0:00:22.680 --> 0:00:25.960 Our first hour all about China dominating the global financial 0:00:25.960 --> 0:00:29.800 and geopolitical headlines throughout the week, including with its response 0:00:29.840 --> 0:00:33.040 to our international cover story. As Bloomberg Business Week editor 0:00:33.120 --> 0:00:37.199 Joe Weber secured an exclusive interview with Taiwan's vice president 0:00:37.280 --> 0:00:41.040 and leading presidential candidate in the upcoming elections. We're talking 0:00:41.080 --> 0:00:42.000 about ly Ching Dung. 0:00:42.560 --> 0:00:45.000 It was his first sit down with international media and 0:00:45.000 --> 0:00:48.240 it focused on his plans for keeping peace with China 0:00:48.280 --> 0:00:51.160 and Carol, this interview caught Beijing's attention almost as soon 0:00:51.240 --> 0:00:53.400 as it was published. We actually got word of it 0:00:53.600 --> 0:00:56.000 just before our broadcast on Tuesday when we read off 0:00:56.000 --> 0:00:58.640 the statement from China's Taiwan Affairs Office on air. 0:00:58.720 --> 0:01:02.360 We did, indeed, China called a complete trouble maker. That's 0:01:02.400 --> 0:01:05.920 a quote seeking Taiwan independence and that his comments on 0:01:06.040 --> 0:01:09.800 so called maintaining the peaceful status quo or totally a lie. 0:01:09.959 --> 0:01:12.760 That statement also said quote such a person will only 0:01:12.760 --> 0:01:14.440 bring risks of fierce war. 0:01:15.440 --> 0:01:18.680 With more on the conversation and on Taiwan, which is 0:01:18.720 --> 0:01:20.440 one of the most prosperous places in the world, we 0:01:20.440 --> 0:01:24.040 should note is Joel Weber. Joel, congratulations on this incredible piece. 0:01:24.040 --> 0:01:25.840 I mean, it wasn't that long ago that you were 0:01:25.840 --> 0:01:27.800 actually there doing this. Talk to us a little bit 0:01:27.800 --> 0:01:30.160 about how this came together and take us behind the scenes. 0:01:31.520 --> 0:01:35.880 So I've got amazing colleagues, We have amazing colleagues in Taipei, 0:01:36.120 --> 0:01:38.680 and they kind of had just reached out to tell 0:01:38.720 --> 0:01:44.680 me more about the overall election, which isn't until January, 0:01:45.560 --> 0:01:48.520 but in the turbulent Taiwanese politics, you. 0:01:48.680 --> 0:01:50.520 Kind of want to get in on this stuff early. 0:01:51.240 --> 0:01:55.960 The last time the presidential election happened, it was a 0:01:56.080 --> 0:01:58.880 pretty big flip actually, so we wanted to kind of 0:01:58.960 --> 0:02:03.960 establish the presidence for our reporting and our bureau in 0:02:04.040 --> 0:02:06.840 the region there, and so I said, well, what do 0:02:06.920 --> 0:02:09.240 we want to talk about, and they said, well, Liai 0:02:09.320 --> 0:02:11.880 Jung Doa is the front runner and he's the current 0:02:12.160 --> 0:02:15.000 vice president, and he's really the person that we should 0:02:15.000 --> 0:02:16.839 talk about, and I often think when there's a really 0:02:16.960 --> 0:02:20.959 chaotic or turbulent thing in the world. In this case, 0:02:21.000 --> 0:02:23.840 I think it's probably the most complicated geopolitical situation that 0:02:23.919 --> 0:02:29.600 you can imagine, and dropping into it as I did, 0:02:30.280 --> 0:02:33.799 revealed how complicated it is. It helps to have like 0:02:33.880 --> 0:02:35.639 a little bit of a rock that you can kind 0:02:35.639 --> 0:02:38.400 of tell that story through, and that's what we were 0:02:38.440 --> 0:02:40.760 able to do with Lia and I had a series 0:02:40.840 --> 0:02:45.760 of exclusive interviews with him. It's all tied to his transit, 0:02:46.040 --> 0:02:51.440 which gets to a thing that's part of the geopolitical complexity. 0:02:50.919 --> 0:02:51.520 That I mentioned. 0:02:52.320 --> 0:02:56.280 If you're a Taiwan ees official or elected official, you 0:02:56.480 --> 0:03:00.239 can't just do a round trip flight from Taiwan to 0:03:00.800 --> 0:03:05.600 anywhere in the US. You have to transit, which means 0:03:05.639 --> 0:03:09.040 that you have a stopover, which is effectively an extended layover. 0:03:09.200 --> 0:03:12.600 So he did that last weekend through New York en 0:03:12.800 --> 0:03:15.840 route to Paraguay. Paraguay happens to be one of the 0:03:15.960 --> 0:03:20.240 dwindling number of official sort of diplomatic countries that Taiwan 0:03:20.360 --> 0:03:25.919 has formal alliances with, the other ones China has strategically 0:03:26.040 --> 0:03:29.839 managed to flip in recent years. So Hondura Squadmala. These 0:03:29.840 --> 0:03:33.200 are countries that were once on Taiwan's side and have 0:03:33.360 --> 0:03:37.600 flipped to Beijing's corner. So Beijing is in Taiwan. Is 0:03:37.720 --> 0:03:41.080 really what this story is about. And you know, for 0:03:41.200 --> 0:03:44.000 a long time that prosperity that you mentioned, that was 0:03:44.080 --> 0:03:49.240 because there is this really effective triangle where Taiwan would 0:03:49.920 --> 0:03:54.720 have manufacturing in China export to the US. Everybody prospered 0:03:54.840 --> 0:03:59.840 for decades. That worked until China started to reassert it. 0:04:00.680 --> 0:04:04.920 And that's where we come into this upcoming election because 0:04:05.480 --> 0:04:10.240 as China's asserted itself, Taiwan, which is a self governing 0:04:10.840 --> 0:04:15.680 island democratic Beijing, looks at that and says, we're the 0:04:15.720 --> 0:04:19.520 Republic of China Taiwan, which also did I mention how 0:04:19.640 --> 0:04:21.640 complicated the geopolitical part of this was. 0:04:21.880 --> 0:04:24.160 I can only imagine the conversation that you had with him, 0:04:24.200 --> 0:04:28.120 how careful you were in terms of how you phrase things, because. 0:04:27.920 --> 0:04:29.760 We know, watch the video, you can see me checking 0:04:29.800 --> 0:04:30.160 my notes. 0:04:30.360 --> 0:04:34.640 No, you're but I mean the question of war, the 0:04:34.760 --> 0:04:39.480 potential if China invades, and that is certainly you know, 0:04:39.760 --> 0:04:43.080 something that was obviously top of mind here big. 0:04:43.000 --> 0:04:47.640 Time, and look like the stakes for this election actually 0:04:47.680 --> 0:04:51.719 couldn't be higher. I think the global economy is absolutely 0:04:51.800 --> 0:04:54.680 dependent on Taiwan, and that is large part because of 0:04:54.920 --> 0:04:58.480 the semiconductor industry. Something like ninety percent of chips come 0:04:58.560 --> 0:05:01.960 from Taiwan. We learned how important that was during the 0:05:02.040 --> 0:05:05.520 pandemic when we had the supply chain carnage. And you know, 0:05:05.680 --> 0:05:09.440 Taiwan is just instrumental and if you if you don't 0:05:09.560 --> 0:05:12.040 have those chips, I think we look at living would 0:05:12.160 --> 0:05:13.640 be living in a version of the world that would 0:05:13.680 --> 0:05:15.880 be like nineteen eighty seven or something like that, right. 0:05:15.839 --> 0:05:17.120 Like total reset. 0:05:18.560 --> 0:05:20.600 So Taiwan incredibly important to that. 0:05:20.839 --> 0:05:21.520 You're gonna ask me. 0:05:21.560 --> 0:05:24.040 Something, No, no, Can we share a little bit of 0:05:24.080 --> 0:05:24.520 your interview? 0:05:24.600 --> 0:05:25.479 Yeah, let's do it. Okay. 0:05:25.520 --> 0:05:28.240 We have some of Joel's exclusive interview with Taiwan's vice 0:05:28.279 --> 0:05:32.000 president and they talk specifically about the importance of support 0:05:32.040 --> 0:05:34.960 from the West and keeping peace with China. Check it out, everybody. 0:05:36.560 --> 0:05:42.799 Jesus also way the ools, we must abide by the truth, 0:05:43.200 --> 0:05:46.000 which is what I mean by pragmatism. It is that 0:05:46.120 --> 0:05:50.000 Taiwan is already a sovereign, independent country called the Republic 0:05:50.080 --> 0:05:53.440 of China. It's not part of the People's Republic of China. 0:05:53.960 --> 0:05:57.359 The ROC and PRC are not subordinate to one another. 0:05:57.839 --> 0:06:01.680 It is not necessary to declare independent English shimpud. 0:06:02.520 --> 0:06:05.640 What is your roadmap to formal independence. 0:06:07.000 --> 0:06:11.520 Anyway? Well, it's it and just where the Taii Shenzwan. 0:06:11.839 --> 0:06:14.760 My responsibility is to maintain the status quo in the 0:06:14.800 --> 0:06:19.880 Taiwan Strait while protecting Taiwan and maintaining democracy, peace and prosperity. 0:06:20.520 --> 0:06:24.120 So no such framework exists. We must work to maintain 0:06:24.200 --> 0:06:28.320 the peacefull status quo because Taiwan is already a sovereign country. 0:06:28.880 --> 0:06:32.160 China keeps pushing on the status quo, and it keeps pushing. 0:06:32.720 --> 0:06:36.240 It's fire a missile over Taiwan to cross the median 0:06:36.360 --> 0:06:40.400 line in the Taiwan Street, and its simulated a naval blockhead. 0:06:41.000 --> 0:06:44.839 What is your red line, thai shinzwang? The chinsu jinzung. 0:06:45.200 --> 0:06:48.440 Increased tensions impacting the status quo in the Taiwan Strait 0:06:48.560 --> 0:06:52.159 have not originated from Taiwan. They are due to China's 0:06:52.200 --> 0:06:56.600 growing assertiveness. China not only seeks to annex Taiwan, it 0:06:56.680 --> 0:07:00.680 also hopes to change the international rules based order. Under 0:07:00.720 --> 0:07:04.480 these circumstances, we must be clear Taiwan's security is of 0:07:04.680 --> 0:07:08.560 international concern. Peace and stability in the Taiwan Strait is 0:07:08.600 --> 0:07:15.240 aligned with the international interesting because challenges in the Taiwan 0:07:15.280 --> 0:07:18.640 Strait are a global concern, a global red line will 0:07:18.680 --> 0:07:22.239 also be Taiwan's red line and my personal red line. 0:07:22.600 --> 0:07:27.800 You've said provocative things in the past that will be 0:07:27.880 --> 0:07:31.960 of interest in Washington. How have you changed is. 0:07:34.280 --> 0:07:37.360 I have been part of President Sai's national security team. 0:07:37.920 --> 0:07:41.080 Together with the US government, we have responsible and clear 0:07:41.200 --> 0:07:45.120 channels of communication. We are able to share information effectively, 0:07:45.600 --> 0:07:49.000 understand where the issues are, and cooperate in resolving them. 0:07:51.840 --> 0:07:55.600 This election is about choosing between two roads. One way 0:07:55.800 --> 0:07:59.160 is to continue engaging and cooperating closely with the international 0:07:59.240 --> 0:08:03.560 community while deepening our democracy. The other choice is to 0:08:03.640 --> 0:08:06.680 accept the one China principle and stand together with China. 0:08:07.440 --> 0:08:10.080 I believe the US will continue to support us on 0:08:10.200 --> 0:08:12.320 the first Pathe means. 0:08:13.760 --> 0:08:17.080 How confident are you that the US will have Taiwan's 0:08:17.160 --> 0:08:19.720 back should the situation with China escort? 0:08:20.200 --> 0:08:23.800 I mean, well so, Taiwanda jupong Il. 0:08:24.400 --> 0:08:27.280 The US is a close friend of Taiwan. We are 0:08:27.360 --> 0:08:30.720 partners in a number of areas, from politics, the economy, 0:08:31.080 --> 0:08:33.600 human rights to our society. 0:08:33.679 --> 0:08:36.240 In with Taiwan, the ANJUNGUNTI. 0:08:35.880 --> 0:08:40.120 Because Taiwan's security challenges are a global concern. The upkeep 0:08:40.160 --> 0:08:42.959 of peace and stability in both the Taiwan Straight and 0:08:43.080 --> 0:08:46.439 the Indo Pacific region fulfills the common interests of the 0:08:46.520 --> 0:08:50.280 international community. I believe that all democracies in the world, 0:08:50.400 --> 0:08:53.400 including the US, would be aware of how to respond 0:08:53.640 --> 0:08:55.640 if such a scenario were to take place. 0:08:56.720 --> 0:09:00.040 And that, of course was Taiwan's Vice president Laichingdong, I 0:09:00.120 --> 0:09:02.400 think was presidential candidate, as we've said, for the upcoming 0:09:02.400 --> 0:09:05.959 election in Taiwan elections, I should say, of course. Talking 0:09:06.080 --> 0:09:08.439 in an exclusive interview with the editor of Bloomberg Business Week, 0:09:08.520 --> 0:09:09.239 Jill Weber. 0:09:09.200 --> 0:09:11.880 Jill, one thing that I was struck with struck by 0:09:11.960 --> 0:09:15.839 in the piece is the changing view Taiwanese people have 0:09:15.920 --> 0:09:19.120 about themselves, about their own identity in the piece and 0:09:19.800 --> 0:09:22.360 what they consider themselves. Talk to me a little bit 0:09:22.360 --> 0:09:23.880 about how that's evolved in recent years. 0:09:25.240 --> 0:09:31.200 Complicated question, But you know, Taiwan actually views itself as 0:09:32.960 --> 0:09:36.880 the Republic of China Taiwan, and that is rooted in 0:09:37.280 --> 0:09:44.000 the history of Taiwan, which basically was this military standoff 0:09:44.240 --> 0:09:49.640 and the Taiwanese left mainland China and basically have never 0:09:50.400 --> 0:09:55.640 been under Beijing's authority. Right, So the longer that this 0:09:55.840 --> 0:09:59.120 has gone on, the more that the Taiwanese identify as 0:10:00.080 --> 0:10:03.880 Wines and less as Chinese. And that's sort of reflected 0:10:03.960 --> 0:10:05.760 in some of the point that you're referring to. 0:10:05.800 --> 0:10:08.880 Business Wek editor Jill Weber on his exclusive with Taiwan's 0:10:08.960 --> 0:10:12.640 sitting VP and top presidential candidate La Chinda. It's our 0:10:12.679 --> 0:10:15.920 international cover story this week. That full interview. Check it 0:10:15.960 --> 0:10:18.440 out available online at Bloomberg dot com and of course 0:10:18.760 --> 0:10:21.040 always on the Bloomberg terminal. Joel by the way back 0:10:21.080 --> 0:10:22.679 with us next hour coming up. 0:10:22.920 --> 0:10:25.439 As time Wan thinks about its relationship with Beijing, the 0:10:25.559 --> 0:10:27.839 rest of the world is taking stock of China's role 0:10:28.040 --> 0:10:29.079 in the global economy. 0:10:29.200 --> 0:10:32.720 We probably will see China grew at an even slower pace, 0:10:33.120 --> 0:10:35.959 and if, of course, at risks and crises continue to 0:10:36.040 --> 0:10:38.280 take plays, we may be looking at a China that 0:10:38.360 --> 0:10:39.320 grows at one percent. 0:10:39.559 --> 0:10:42.439 The managing director at China beige Book International breaks down 0:10:42.480 --> 0:10:45.680 the ominous data. Next, you're listening to Bloomberg Business Week, 0:10:46.000 --> 0:10:47.240 this is Bloomberg. 0:10:47.800 --> 0:10:51.320 You're listening to the Bloomberg Business Week podcast. Catch us 0:10:51.400 --> 0:10:54.679 live weekday afternoons from three to six Eastern Listen on 0:10:54.800 --> 0:10:58.800 Bloomberg dot com, the iHeartRadio app, and the Bloomberg Business app, 0:10:59.120 --> 0:11:00.800 or watch us live on YouTube. 0:11:01.679 --> 0:11:05.120 So another twenty four hours, another batch of Chinese headlines. 0:11:05.120 --> 0:11:07.520 As you just heard in our chat, it's just simply 0:11:07.559 --> 0:11:09.960 the continued weakness and inability of China to kick up 0:11:09.960 --> 0:11:13.440 their once very reliable growth machine. The worries continuing tim 0:11:13.520 --> 0:11:15.600 on news that one of China's biggest shadow bank skip 0:11:15.640 --> 0:11:19.880 payments on several investment products, sparking rare protests in Beijing 0:11:20.320 --> 0:11:22.839 as a fallout from a deepening property slump spreads to 0:11:22.960 --> 0:11:24.920 the financial sector, and this has been the worry. Is 0:11:25.000 --> 0:11:28.920 this potentially China's great financial crisis? Not saying it is, 0:11:29.080 --> 0:11:29.840 We're just questioning. 0:11:30.000 --> 0:11:31.439 That's a question We're going to continue to ask. The 0:11:31.480 --> 0:11:34.319 liquidity challenges we are seeing in China underscore how troubles 0:11:34.360 --> 0:11:37.400 in the property sector and China's weakening economy and now 0:11:37.480 --> 0:11:41.000 spreading deeper into the financial industry. Many trust products are 0:11:41.040 --> 0:11:43.920 backed by real estate projects run by troubled developers such 0:11:43.960 --> 0:11:45.480 as China Evergrand Group and. 0:11:45.520 --> 0:11:48.080 Then tim We learned Thursday that Evergrand followed for Chapter 0:11:48.160 --> 0:11:51.640 fifteen bankruptcy protection in New York, that move shielding it 0:11:51.679 --> 0:11:53.800 from creditors in the United States while it works on 0:11:53.840 --> 0:11:58.040 a restructuring deal elsewhere, And that followed the earlier news 0:11:58.200 --> 0:12:00.920 in the week of China's Central Bank having interest rates 0:12:01.000 --> 0:12:02.959 by the most in three years in a bid to 0:12:03.040 --> 0:12:05.240 revive growth. A lot going on so with us to 0:12:05.320 --> 0:12:10.240 discuss China's fundamental economic backdrop is Shazad Kazi, Managing director 0:12:10.280 --> 0:12:13.000 at China beij Book International. They were founded back in 0:12:13.200 --> 0:12:17.240 twenty ten to help institutional investors in corporate CEOs navigate 0:12:17.360 --> 0:12:21.200 China's notoriously black box economy. China beij Book has developed 0:12:21.200 --> 0:12:24.840 its own private in country data collection network to track 0:12:24.920 --> 0:12:28.720 the Chinese marketplace, gathering real time economic data from thousands 0:12:28.760 --> 0:12:31.720 of firms across all of China's region sectors and thirty 0:12:31.760 --> 0:12:35.599 four discrete industries. We spoke with Shazad on Wednesday and 0:12:35.679 --> 0:12:38.520 asked for his response to President Joe Biden's recent remarks 0:12:38.760 --> 0:12:41.480 in which he referred to China's economy as quote a 0:12:41.600 --> 0:12:42.520 ticking time bomb. 0:12:43.720 --> 0:12:46.760 I don't fully agree with the president's statement. All those sorts. 0:12:46.800 --> 0:12:50.040 The President has it more right than many China watchers 0:12:50.080 --> 0:12:52.520 who do this for a living. What's going on in 0:12:52.679 --> 0:12:56.120 China is that you've got a structural slowdown in place. 0:12:56.679 --> 0:13:00.240 So Chinese economy is well past the years where it 0:13:00.360 --> 0:13:02.839 used to grow in the double digits, for sure, but 0:13:02.960 --> 0:13:06.720 even something like six percent seven percent growth is now 0:13:07.559 --> 0:13:11.480 you know, behind us. The growth that we're looking at 0:13:11.559 --> 0:13:15.439 into the future for China is probably something between three 0:13:15.480 --> 0:13:18.439 to five percent in the in the next four or 0:13:18.520 --> 0:13:22.080 five years, and beyond that we probably will see China 0:13:22.120 --> 0:13:26.480 grow at an even slower pace. And of course risks 0:13:26.520 --> 0:13:29.240 and crises continue to take place. We may be looking 0:13:29.280 --> 0:13:31.719 at a China that grows at one percent, perhaps some 0:13:31.880 --> 0:13:32.920 years doesn't grow at. 0:13:34.520 --> 0:13:38.280 Is this just a factor of a maturing economy or 0:13:38.559 --> 0:13:42.199 is the concern that the reopening was a disaster and 0:13:42.400 --> 0:13:43.880 that there are structural issues there. 0:13:45.320 --> 0:13:47.240 Yeah, there are a couple of things going on. The 0:13:47.360 --> 0:13:49.920 first one is that the old Chinese growth model, which 0:13:50.000 --> 0:13:52.719 everybody I think has been trained on, which is that 0:13:52.840 --> 0:13:55.679 you ramp up credit, you ramp up investment, and you 0:13:55.840 --> 0:13:58.240 juice that to get a high level of growth, that 0:13:58.400 --> 0:14:01.680 has really run out of road. Even if today Chinese 0:14:01.720 --> 0:14:06.199 policy makers were to continue doing big stimulus and big 0:14:06.280 --> 0:14:08.680 fiscal spending, they wouldn't be able to get those growth 0:14:08.800 --> 0:14:11.160 rates again anyway. So there's that structural component of it 0:14:11.440 --> 0:14:14.520 inevitable slow down. And that said that's taking place. However, 0:14:14.640 --> 0:14:16.880 there has been a very important change that I think 0:14:16.920 --> 0:14:22.360 has gone largely underappreciated still by markets. That's the Chinese 0:14:22.400 --> 0:14:26.520 policy makers, I think President Shee on down have decided that, look, 0:14:26.600 --> 0:14:29.440 we don't want that old growth model. We want something 0:14:29.520 --> 0:14:32.680 that's much more sustainable and much more healthy. And that 0:14:32.880 --> 0:14:34.600 means that we need to de risk the system. We 0:14:34.680 --> 0:14:36.920 need to really work on de leveraging, we need to 0:14:36.960 --> 0:14:40.000 deflay the property bubble, and we need to transition the 0:14:40.080 --> 0:14:44.120 economy towards a consumer driven economy rather than just this 0:14:44.240 --> 0:14:47.360 big industrial behemit that China is. How to ever get 0:14:47.400 --> 0:14:48.400 there is a separate question. 0:14:48.600 --> 0:14:50.960 Well, I was just going to say, you know that, 0:14:51.160 --> 0:14:55.000 are they right to pursue that to have something more sustainable? 0:14:55.040 --> 0:14:58.000 Although one percent growth longer term to me sounds like 0:14:58.040 --> 0:15:00.920 a bit of a bummer for it for one of 0:15:00.960 --> 0:15:03.440 the world's largest economies. 0:15:05.320 --> 0:15:08.280 Yeah, I think there's you know. The smart thing to do, 0:15:08.400 --> 0:15:11.640 of course, was to start working on this economic transition, 0:15:11.760 --> 0:15:14.600 probably even sooner than they did. It just happens to 0:15:14.640 --> 0:15:17.680 be that they started really working on it with the 0:15:17.800 --> 0:15:20.480 COVID crisis ongoing as it is, And so you're getting 0:15:20.480 --> 0:15:22.120 this bit of a double ammy right now, right with 0:15:22.200 --> 0:15:25.680 a cyclical downturn, COVID induced pressures, and of course the 0:15:25.680 --> 0:15:28.360 structural flow down all happening more or less at the 0:15:28.440 --> 0:15:31.920 same time. The fact is, the world would be much 0:15:32.000 --> 0:15:36.040 better off with the Chinese economy that was importing more 0:15:36.120 --> 0:15:39.200 than it does and exporting less than it does. And 0:15:40.000 --> 0:15:41.720 you know that would have farm You know, that would 0:15:41.760 --> 0:15:44.160 be far more beneficial for countries around the world. They 0:15:44.160 --> 0:15:46.560 should absolutely be working on it. I'm just not sure 0:15:46.600 --> 0:15:49.560 they put in all the right policy policies in place 0:15:49.600 --> 0:15:52.120 even right now though, to be able to successfully accomplish that. 0:15:52.240 --> 0:15:54.360 Why would the world be Why would the overall world 0:15:54.440 --> 0:15:56.880 be better off with the Chinese economy that was importing 0:15:56.920 --> 0:15:58.040 more rather than exporting. 0:15:59.480 --> 0:16:03.320 Well of the world's biggest markets by population size alone, it's, 0:16:03.920 --> 0:16:05.720 you know, the thing that companies have been waiting on 0:16:05.840 --> 0:16:07.920 for decades, not to be able to sell more and 0:16:08.000 --> 0:16:11.080 more into China. But the problem, by the way, is 0:16:11.320 --> 0:16:13.560 that they just don't have the income levels rising there. 0:16:13.600 --> 0:16:15.360 The private sector is not at a place where it 0:16:15.440 --> 0:16:19.000 can absorb a lot of the young graduates and create 0:16:19.120 --> 0:16:21.720 high paying jobs, and so that transition is going to 0:16:21.760 --> 0:16:24.160 take a long time, beginning with support to the private sector, 0:16:24.200 --> 0:16:25.240 which is just not coming. 0:16:26.960 --> 0:16:30.560 Hey, Shasatt, I wanted to ask about politics and what 0:16:30.680 --> 0:16:33.040 you're hearing on the ground about the way that people 0:16:33.160 --> 0:16:40.800 view the Chinese Communist Party and how economic issues economic 0:16:40.920 --> 0:16:43.480 challenges could lead to a challenge of their power. 0:16:45.600 --> 0:16:47.880 Yeah. I tend to be very very bearish on the 0:16:48.000 --> 0:16:51.400 idea that the ongoing economic crisis and really is a 0:16:51.480 --> 0:16:55.360 multi crisis at this point, is going to threaten the 0:16:55.480 --> 0:16:59.280 long term control of either you know, President She or 0:16:59.360 --> 0:17:02.320 the Communist Party. I think there's been a lot of 0:17:02.360 --> 0:17:07.840 work done to consolidate power. There is nowhere nobody within 0:17:07.920 --> 0:17:11.080 the party today even who could challenge President She, let 0:17:11.080 --> 0:17:13.440 alone outside of the party, which is a very small 0:17:13.480 --> 0:17:18.960 probability event. I don't foresee the current economic challenges of 0:17:19.160 --> 0:17:22.239 China stay thing as threatening the party's control. It may 0:17:22.400 --> 0:17:25.000 sour people on the party. I think China, you know, 0:17:25.200 --> 0:17:28.439 maybe may see more, you know, unrest, may see more 0:17:28.520 --> 0:17:30.800 protests building up, but I just don't think we're in 0:17:30.840 --> 0:17:33.560 a place where the party uses its controller it's even 0:17:33.720 --> 0:17:34.560 remotely front. 0:17:34.440 --> 0:17:35.680 So soada, I have to go back to where you 0:17:35.720 --> 0:17:37.280 said the world would be better off of the Chinese 0:17:37.320 --> 0:17:40.159 economy that imports more. You know, increasingly, though it does 0:17:40.280 --> 0:17:44.840 feel like President she He is all about cultivating, developing 0:17:44.880 --> 0:17:47.840 the domestic economy. I understand the import of that. How 0:17:48.000 --> 0:17:51.800 does though, I mean, companies have been clamoring for thirty 0:17:51.920 --> 0:17:55.200 forty decades to get into China and tap that domestic market, 0:17:55.280 --> 0:17:58.480 and it increasingly looks like anybody who's not a Chinese 0:17:58.520 --> 0:18:01.880 based company will not benefit much unless you're Elon Musk potentially, 0:18:02.280 --> 0:18:06.440 So I'm trying to understand how the world ultimately benefits 0:18:06.480 --> 0:18:11.000 at present, GE's goal is to produce domestically and then 0:18:11.200 --> 0:18:14.359 sell to its domestic you know, to sell to its people, 0:18:14.640 --> 0:18:17.520 especially if it feel like the tensions that continue increasingly 0:18:17.560 --> 0:18:18.680 cut China off from the world. 0:18:20.240 --> 0:18:23.080 You're certainly right about the fact that both of the 0:18:23.200 --> 0:18:25.800 American companies of Western corporations that have made long term 0:18:25.880 --> 0:18:29.000 China that actually has eventually, especially in the automotive industry, 0:18:29.040 --> 0:18:31.840 even I mean, you know, in Elon's facing a lot 0:18:31.840 --> 0:18:35.400 of problems with having to do pristcepts and so forth. Yes, 0:18:35.440 --> 0:18:39.760 they absolutely ultimately will lose market share to their domestic 0:18:39.880 --> 0:18:43.600 rivals with the states back. I think there are sectors 0:18:43.640 --> 0:18:45.680 where that is more true, and then there are public 0:18:45.800 --> 0:18:48.639 sectors where that is less true. I don't see today 0:18:49.200 --> 0:18:51.720 the goal of the Communist Party to be this completely 0:18:51.880 --> 0:18:56.120 self serving type of entity where they produce and sell 0:18:56.240 --> 0:19:00.000 to themselves and they have no foreigner liance whatsoever. Done 0:19:00.000 --> 0:19:02.080 That's not the model that we're looking at. So I 0:19:02.160 --> 0:19:04.240 think as China were to become, if China were to 0:19:04.320 --> 0:19:08.320 actually become a more prosperous country, bring down inequality levels, 0:19:08.400 --> 0:19:12.119 become a higher income country, they would be importing the 0:19:12.280 --> 0:19:15.680 kinds of services and not just actual goods, but you 0:19:15.720 --> 0:19:19.440 know other services that are the developed world today does 0:19:20.200 --> 0:19:22.320 if you look at the luxuries market, you could potentially 0:19:22.320 --> 0:19:25.359 see that getting bigger. Obviously, we know that there are 0:19:25.359 --> 0:19:28.200 all sorts of reliance and even basic things like foodstuffs 0:19:28.480 --> 0:19:31.040 that China remains very much dependent on. So I think 0:19:31.080 --> 0:19:33.959 it's not even just China importing, but what is China importing. 0:19:34.040 --> 0:19:36.840 It's not just commodities and oil and iron ore, but 0:19:37.359 --> 0:19:39.000 other iron of all these. 0:19:38.920 --> 0:19:42.760 Things, Shazad got to be really fast. Fifteen twenty seconds. 0:19:42.920 --> 0:19:45.479 What would make you get really nervous at maybe China's 0:19:45.480 --> 0:19:47.840 having its own great financial crisis? Be very quick. 0:19:50.160 --> 0:19:52.720 If a range of these major developers are allowed to 0:19:52.800 --> 0:19:55.359 fail and fail completely, I don't think it's going to happen. 0:19:55.359 --> 0:19:56.800 I don't think we get a Leman moment or a 0:19:56.800 --> 0:20:00.440 great facial crisis in China. It's not a commercial sector. 0:20:00.480 --> 0:20:02.879 The stable step in to provide support, even if it's 0:20:02.920 --> 0:20:03.840 import So great to. 0:20:03.880 --> 0:20:04.359 Check in with you. 0:20:04.600 --> 0:20:08.480 Shazad Kazi, Managing director at China beise Book International, joining 0:20:08.560 --> 0:20:09.960 us on zoom Thank you so much. 0:20:10.800 --> 0:20:14.359 You're listening to the Bloomberg Business Week podcast. Catch us 0:20:14.440 --> 0:20:17.160 live weekday afternoons from three to six Easter. 0:20:17.320 --> 0:20:20.720 On Bloomberg Radio, the Bloomberg Business App, and YouTube. 0:20:21.000 --> 0:20:23.840 You can also listen live on Amazon Alexa from our 0:20:23.880 --> 0:20:28.320 flagship New York station, Just say Alexa Play Bloomberg eleven thirty. 0:20:30.000 --> 0:20:33.200 China's top leaders pledge this week to expand semester consumption. 0:20:33.359 --> 0:20:35.560 Support the private sector, support that you want. There's a 0:20:35.640 --> 0:20:38.920 lot going on. Bottom line, it is all about attempts 0:20:38.920 --> 0:20:41.960 to boost confidence in the Chinese economy as market sinc 0:20:42.359 --> 0:20:46.120 and concerns grow over the property market, continued concerns really 0:20:46.560 --> 0:20:49.840 and potential financial fallout as a result, and then growth 0:20:50.000 --> 0:20:53.119 just continuing to disappoint in the Chinese economy. As we 0:20:53.200 --> 0:20:56.440 continue our discussions on the many challenges facing the People's Republic, 0:20:56.760 --> 0:20:59.040 we bring in a familiar voice to help us understand 0:20:59.080 --> 0:21:01.119 how things have gone so far away. 0:21:01.640 --> 0:21:03.800 We've got back with us Dexter Roberts. He's Director of 0:21:03.880 --> 0:21:06.600 China Affairs at the Mansfield Center at the University of Montana. 0:21:06.680 --> 0:21:10.159 He's also an award winning journalist former Bloomberg a BusinessWeek 0:21:10.280 --> 0:21:13.240 China Bureau chief. His book The Myth of Chinese Capitalism, 0:21:13.320 --> 0:21:15.360 The Worker, the Factory, and the Future of the World, 0:21:15.480 --> 0:21:17.960 was chosen as one of the Economists Best Book of 0:21:18.000 --> 0:21:20.320 the Year for twenty twenty. Very pleased to have him 0:21:20.359 --> 0:21:23.680 back with us, joining us from Missoula, Montana. Well, you know, 0:21:23.920 --> 0:21:25.800 whenever we got you back, we know that it's because 0:21:25.800 --> 0:21:27.919 there's something big going on in China, and this has 0:21:27.960 --> 0:21:29.359 been happening for a while, and if we wanted you 0:21:29.440 --> 0:21:31.840 to get back with us for a while. We spent 0:21:31.920 --> 0:21:35.119 some time with Shazadkazi earlier from China Baige book, give us, 0:21:35.720 --> 0:21:38.000 you know the thirty thousand foot view here, somebody who 0:21:38.040 --> 0:21:41.919 spent so much time in China. What your impression now 0:21:42.080 --> 0:21:45.560 is a former insider now an outsider. What you're seeing 0:21:45.600 --> 0:21:47.760 happen and what you're hearing from your sources on the ground. 0:21:49.160 --> 0:21:51.840 Yeah, well, I think what China's really dealing with with 0:21:51.960 --> 0:21:55.639 all this bad economic news we're hearing is trying to 0:21:55.680 --> 0:21:59.320 work out some serious structural challenges. So this is not cyclical, 0:22:00.160 --> 0:22:03.840 by the way, means that the latest surprise rate cut 0:22:03.920 --> 0:22:07.960 on Tuesday, I'm not confident is going to help much. 0:22:08.480 --> 0:22:12.000 So China's in the midst of this is from the 0:22:12.520 --> 0:22:14.399 ten thousand feet up, It's in the midst of this 0:22:14.560 --> 0:22:19.439 transition from its previous investment and debt driven economic model 0:22:19.480 --> 0:22:22.280 to one they hope would be much more driven by 0:22:22.359 --> 0:22:26.800 household consumption, and they are really struggling with that. Confidence 0:22:27.520 --> 0:22:32.080 amongst counsels and amongst companies is a huge challenge. Still 0:22:32.160 --> 0:22:35.000 today it actually mirrors. 0:22:35.040 --> 0:22:37.600 Very much so what Shazad said to us, this whole idea, 0:22:37.960 --> 0:22:40.240 the world would be so much better with the Chinese 0:22:40.280 --> 0:22:44.240 economy that imports more and that you have this domestic 0:22:44.320 --> 0:22:48.680 economy that is spending a domestic home front, if you will, 0:22:48.760 --> 0:22:52.360 that is spending more on stuff kind of maybe more 0:22:52.440 --> 0:22:55.800 to some of the developed world. So tif many of 0:22:55.920 --> 0:22:58.119 us are outsiders, haven't spent the time in China like 0:22:58.200 --> 0:22:58.399 you have. 0:22:59.040 --> 0:22:59.720 We see these. 0:22:59.600 --> 0:23:02.800 Headline it feels like a lot. It feels like, you know, 0:23:02.880 --> 0:23:06.680 we're hearing about the potential for Chinese contagion. How do 0:23:06.800 --> 0:23:10.320 you think we should be smart in terms of reading 0:23:10.560 --> 0:23:11.359 these headlines? 0:23:12.760 --> 0:23:15.280 Well, I think one thing we have to keep in 0:23:15.440 --> 0:23:18.920 mind is that as long as the leadership in Beijing, 0:23:19.040 --> 0:23:21.840 and I'm thinking particularly the very top leaders in chi 0:23:21.960 --> 0:23:28.280 Jinping continue to have this focus on politicizing the economy 0:23:28.440 --> 0:23:32.040 and basically masterminding from above how they want things to change, 0:23:32.320 --> 0:23:36.119 and that includes the latest and the latest news about 0:23:37.160 --> 0:23:41.720 more instructions to investment bankers, economists and company officials to 0:23:42.200 --> 0:23:45.200 make sure they don't say negative things about the economy. 0:23:46.320 --> 0:23:49.760 But then obviously this extends much further into the economy. 0:23:49.760 --> 0:23:52.960 As long as they keep doing that, I think these 0:23:53.119 --> 0:23:56.280 changes we see, you know, on a weekly, monthly basis, 0:23:56.560 --> 0:23:58.639 are not going to make a lot of difference. And 0:23:59.160 --> 0:24:03.440 by the way, that politicization of the economy has huge 0:24:03.480 --> 0:24:06.520 repercussions within China as well. We see it with this, 0:24:08.000 --> 0:24:10.639 We've hit with wealthy people voting with their feed if 0:24:10.720 --> 0:24:13.399 you will, and trying to move broad including moving their 0:24:13.440 --> 0:24:14.119 capital abroad. 0:24:14.280 --> 0:24:16.280 But does it actually move the needle when it comes 0:24:16.280 --> 0:24:19.800 to the power that the Chinese Communist Party has, Shazad said, no, 0:24:19.920 --> 0:24:20.359 it doesn't. 0:24:21.840 --> 0:24:25.440 Well, I think that's the issue. The Communist Party is 0:24:25.600 --> 0:24:29.280 more powerful than it has been in literally decades. I 0:24:29.440 --> 0:24:31.880 was there for almost twenty five years, and I never 0:24:31.960 --> 0:24:35.800 saw anything like this, even as the Communist Party did 0:24:35.840 --> 0:24:39.159 interfere in the economy. But they're really they've moved it, 0:24:39.359 --> 0:24:42.399 moved it to a whole new level of medaling, if 0:24:42.440 --> 0:24:45.480 you will, in the economy. And I think that's a 0:24:45.600 --> 0:24:47.399 reality we're going to be dealing with for quite a 0:24:47.440 --> 0:24:50.240 while as long as we have Shi Jumping continued to 0:24:50.280 --> 0:24:50.960 be in charge here. 0:24:51.200 --> 0:24:54.560 A company that is constantly meddled in to me, maybe 0:24:54.760 --> 0:24:59.560 has limits ultimately, especially if you're trying to attract investors 0:24:59.720 --> 0:25:02.800 or outside investors. Maybe China doesn't need outside investors, I mean, 0:25:02.960 --> 0:25:04.760 will it ultimately, I mean, does it need to be 0:25:04.880 --> 0:25:09.680 kind of part of the open world capitalistic society or 0:25:09.720 --> 0:25:10.800 can it just do it on its own? 0:25:12.000 --> 0:25:14.760 I think that it cannot do it on its own, 0:25:14.840 --> 0:25:18.360 and unfortunately, the top leadership seems to think that they can. 0:25:19.119 --> 0:25:22.680 They talk a lot about self reliance and thinking that 0:25:22.760 --> 0:25:25.600 they can go it alone, but they really can't. I mean, 0:25:25.640 --> 0:25:29.680 we've seen this with the Biden administration's policies and restrictions 0:25:29.760 --> 0:25:33.639 on the advanced semiconductor industry. These really really hurt China. 0:25:33.800 --> 0:25:38.040 China needs the world, needs the technology, needs the investment 0:25:38.800 --> 0:25:42.160 technology in particular to keep moving up the value chain 0:25:42.240 --> 0:25:45.920 and technology and particularly things like advanced semiconductors. And so 0:25:46.880 --> 0:25:49.159 I don't think they can go a go it alone 0:25:49.200 --> 0:25:50.080 at this point at all. 0:25:50.320 --> 0:25:52.359 Hey, So when you know, Tim and I talked earlier 0:25:52.400 --> 0:25:53.879 because this story kind of struck me, and we know 0:25:54.000 --> 0:25:56.879 it's been coming because it's not new. But the Apple 0:25:56.920 --> 0:26:00.960 supplier Fox Con beginning iPhone and fifteen products in India 0:26:01.760 --> 0:26:04.720 really ramping up efforts. We see stuff like that. Is 0:26:04.800 --> 0:26:06.800 that exactly what China wants because they want to be 0:26:06.880 --> 0:26:10.840 on a higher plane in terms of technology. They don't 0:26:10.840 --> 0:26:13.639 want to be just manufacturing everything. So is that okay? 0:26:13.760 --> 0:26:15.879 Or is that something that's going to be problematic for 0:26:16.000 --> 0:26:18.040 China short term, longer term, I don't know. 0:26:19.320 --> 0:26:23.480 I think that China is very aware of the value 0:26:23.560 --> 0:26:27.680 of having global supply chains run through China, and as 0:26:27.880 --> 0:26:31.840 companies like Apple turn to other places like India and 0:26:31.960 --> 0:26:35.520 move more production there is that is a concern of Beijing. 0:26:36.040 --> 0:26:38.920 So they you know that the very low end things, 0:26:39.040 --> 0:26:41.760 they already left your textiles and your toys, and China 0:26:42.200 --> 0:26:44.040 was very happy to see that go as it moved 0:26:44.040 --> 0:26:46.560 to Southeast Asia a decade ago. But if you look 0:26:46.560 --> 0:26:50.679 at big companies like Apple, and I think that at 0:26:50.720 --> 0:26:53.480 that point China's thinking this is very important to us. 0:26:53.520 --> 0:26:56.400 They also happen to be, of course, huge employers. Fox 0:26:56.480 --> 0:26:58.879 Con is the biggest private employer in China. 0:27:00.040 --> 0:27:02.960 Interesting to see the iPhone fifteen news and I mean, look, 0:27:03.160 --> 0:27:05.439 and we know that that fox Con has been building 0:27:05.760 --> 0:27:08.719 handsets and products in India for a few years now, 0:27:08.800 --> 0:27:11.000 but to see him take a flagship product like this, 0:27:11.200 --> 0:27:14.520 the iPhone fifteen, and start production on that in India 0:27:14.640 --> 0:27:17.800 is certainly a really big deal tiff. Okay, so let's 0:27:17.840 --> 0:27:20.720 talk about contagion here. To what extent should the world 0:27:20.840 --> 0:27:25.000 be concerned that stresses on the Chinese economy are going 0:27:25.080 --> 0:27:26.840 to spill out across its borders. 0:27:28.200 --> 0:27:31.760 I think we, unfortunately do need to be very worried China. 0:27:31.880 --> 0:27:34.959 You know, for the first time in well other than 0:27:35.000 --> 0:27:36.920 one month at the beginning of the pandemic, it was 0:27:36.960 --> 0:27:39.480 the first time since a global financial crisis back in 0:27:39.520 --> 0:27:43.600 two thousand and nine, we see deflation both in consumer 0:27:43.640 --> 0:27:48.560 prices and factory gate prices last month, and China, I 0:27:48.680 --> 0:27:52.280 think is that you know, China has is is going 0:27:52.320 --> 0:27:55.520 to export deflation to the world. We had Janet Yellen 0:27:55.640 --> 0:27:59.240 say recently that the Chinese economy was a quote risk 0:27:59.359 --> 0:28:02.920 factor for the US economy the fifth corporate profits around 0:28:02.960 --> 0:28:03.280 the world. 0:28:04.320 --> 0:28:07.680 So you're writing a front page story today on China. 0:28:07.760 --> 0:28:08.639 What's the headline? 0:28:11.040 --> 0:28:17.679 The headline is surprise Rake doesn't convince global market China 0:28:17.840 --> 0:28:20.000 downward spiral continues. 0:28:20.160 --> 0:28:22.080 Nicely said, Wow, okay, great. 0:28:22.359 --> 0:28:24.919 I've experienced as a journalist, an award. 0:28:24.680 --> 0:28:28.119 Winning one at that, Tiff, thank you so much, Always appreciated. 0:28:28.200 --> 0:28:31.000 Dexter Roberts Tiff Roberts, director of China Fairs at the 0:28:31.040 --> 0:28:34.200 Mansfield Center at the University of Montana. As we said, 0:28:34.200 --> 0:28:37.000 award winning journalist, former Bloomberg Business Week, China be You 0:28:37.000 --> 0:28:39.760 Our Chief. His book out in twenty twenty, The Myth 0:28:39.880 --> 0:28:42.840 of Chinese Capitalism, The Worker, the Factory, in the Future 0:28:42.840 --> 0:28:43.240 of the World. 0:28:43.360 --> 0:28:45.840 You're listening to Bloomberg Business Week. Up next, we look 0:28:45.880 --> 0:28:48.400 at how US economic sanctions are weighing on one of 0:28:48.440 --> 0:28:51.680 its chief rival's most important tech companies, even as both 0:28:51.760 --> 0:28:53.320 confront a common threat. 0:28:53.480 --> 0:28:56.360 The challenge of trying to not be distracted from the 0:28:57.000 --> 0:29:02.280 mission of cybersecurity, progress, assurance the geopolitics by the pressure 0:29:02.600 --> 0:29:05.640 there needs to be these kinds of strong standards in 0:29:05.720 --> 0:29:09.000 independent testing for anybody, because the band guys can hack 0:29:09.040 --> 0:29:12.040 into everyone. So we cannot put our guard down by thinking, well, 0:29:12.080 --> 0:29:15.320 we've blocked companies from this country. That's not going to 0:29:15.400 --> 0:29:17.040 make a safer and so we have to make sure 0:29:17.080 --> 0:29:20.360 that we reduce the risk on a continuous basis, hopefully 0:29:20.400 --> 0:29:22.640 on a global basis with our colleagues around the world. 0:29:22.880 --> 0:29:26.080 Huawei USA's chief security officer Andy Perdy on where the 0:29:26.160 --> 0:29:29.440 world's two superpowers can meet in the middle that conversation 0:29:29.640 --> 0:29:31.400 on the other side, This is Bloomberg. 0:29:32.160 --> 0:29:35.680 You're listening to the Bloomberg Business Week podcast. Catch us 0:29:35.800 --> 0:29:39.080 live weekday afternoons from three to six Eastern listen on 0:29:39.200 --> 0:29:43.160 Bloomberg dot com, the iHeartRadio app and the Bloomberg Business app, 0:29:43.520 --> 0:29:45.160 or watch us live on YouTube. 0:29:46.000 --> 0:29:48.920 Earlier this month, Wilwei Technology is reported a third straight 0:29:49.000 --> 0:29:51.640 quarter of sales growth after new businesses such as cloud 0:29:51.720 --> 0:29:55.560 services and a resurgent smartphone unit helped mitigate the fallout 0:29:55.600 --> 0:29:56.880 from US sanctions, and. 0:29:56.960 --> 0:29:59.640 As the company tries to revive its high end device business, 0:30:00.000 --> 0:30:03.080 it's also being forced to navigate an increasingly fractised US 0:30:03.160 --> 0:30:06.400 China relationship. For more on how the company is handling 0:30:06.440 --> 0:30:10.520 these ongoing tensions, we turn to Huawei USA's Chief security officer, 0:30:10.640 --> 0:30:13.479 Andy Purdy, who is also once a White House staffer 0:30:13.840 --> 0:30:16.280 in a US Department of Homeland Security official. 0:30:17.000 --> 0:30:20.560 Well, I think the way I would like to see 0:30:20.600 --> 0:30:26.360 an approach to these issues globally is to try to 0:30:26.400 --> 0:30:28.400 consider what's in the best interests in the United States, 0:30:28.760 --> 0:30:32.400 and a number of these issues, such as what kinds 0:30:32.440 --> 0:30:35.000 of products can be sold to what companies, can be 0:30:35.080 --> 0:30:37.800 fairly complex because there can be a risk that one 0:30:37.880 --> 0:30:40.240 can cut off your nose despite your face and really 0:30:40.320 --> 0:30:44.080 can threaten American jobs. So we've been interested in talking 0:30:44.120 --> 0:30:46.640 to the US government for some years, but right now 0:30:46.760 --> 0:30:50.080 it's really a global situation and we have colleagues around 0:30:50.080 --> 0:30:52.640 the world. I've spoken to several in Europe that the 0:30:52.840 --> 0:30:56.520 challenge of trying to not be distracted from the mission 0:30:56.880 --> 0:31:01.400 of cybersecurity progress assurance by the geopolop by the pressure 0:31:01.760 --> 0:31:04.800 there needs to be these kinds of strong standards in 0:31:04.880 --> 0:31:08.120 independent testing for anybody, because the bad guys can hack 0:31:08.200 --> 0:31:11.200 into everyone. So we cannot put our guard down by thinking, well, 0:31:11.240 --> 0:31:14.480 we've blocked companies from this country. That's not going to 0:31:14.520 --> 0:31:16.160 make a safer and so we have to make sure 0:31:16.240 --> 0:31:19.520 that we reduce the risk on a continuous basis, hopefully 0:31:19.560 --> 0:31:21.760 on a global basis with our colleagues around the world. 0:31:21.920 --> 0:31:23.800 It's a US about business for you guys, right, because 0:31:23.840 --> 0:31:26.200 it hurts business to have these sanctions by the US. 0:31:26.880 --> 0:31:29.120 Yeah, we had about a thirty billion dollars hit in 0:31:29.160 --> 0:31:31.800 our revenue a couple of years ago when they blocked 0:31:31.840 --> 0:31:34.040 the five G chips from being allowed to be sold 0:31:34.080 --> 0:31:37.760 from American companies to Huawei. So our consumer devices took 0:31:38.200 --> 0:31:42.200 basically a permanent hit, and so we have regrouped. We've 0:31:42.560 --> 0:31:45.880 raised our research and development up to twenty five percent 0:31:45.920 --> 0:31:49.400 of our close revenues, and so we're investing in digital 0:31:49.480 --> 0:31:54.280 transformation the intelligent world five G and AI, not generative AI, 0:31:54.400 --> 0:31:58.360 chat gipt, but AI for business for industry. We believe 0:31:58.400 --> 0:32:01.680 that going forward, ninety percent of all ALI will be 0:32:01.840 --> 0:32:05.200 industrial and some agriculture, and only two percent will be consumers. 0:32:05.200 --> 0:32:07.720 So we're working with partners around the world to help 0:32:07.800 --> 0:32:11.720 bring about digital transformation of industry and industry sectors with partners, 0:32:11.760 --> 0:32:12.920 and AI is a big part of it. 0:32:13.120 --> 0:32:13.880 Do you just move on? 0:32:14.040 --> 0:32:15.960 I mean, you guys already have right in terms of 0:32:16.040 --> 0:32:19.720 the restrictions because of those US sanctions, whether it's you 0:32:20.600 --> 0:32:23.719 making your own design tools for processor chips, I mean, 0:32:23.880 --> 0:32:26.840 you just have to kind of move on because you 0:32:26.960 --> 0:32:28.640 don't know whether or not things are going to get 0:32:29.160 --> 0:32:31.800 warmer and fuzzier between the US and China. 0:32:32.440 --> 0:32:32.800 That's right. 0:32:32.840 --> 0:32:34.080 We're not going to look back. We're not going to 0:32:34.120 --> 0:32:37.480 particularly complain about it either. And the excitement of working 0:32:37.520 --> 0:32:39.480 with our partners and customers around the world. There's a 0:32:39.520 --> 0:32:41.000 whole lot of places in the world that want to 0:32:41.040 --> 0:32:43.040 do business with us, a whole lot of places in 0:32:43.040 --> 0:32:45.160 the world. They're going to benefit. And our partners know 0:32:45.280 --> 0:32:47.760 that we don't make money unless they make money, So 0:32:48.320 --> 0:32:52.840 bringing these new technologies in smart mining and ports and healthcare, 0:32:54.440 --> 0:32:58.560 in transportation, smart cities, and frankly, green energy, reducing the 0:32:58.600 --> 0:33:03.640 carbon footprint using technology not just limiting access to fossil fuels, 0:33:03.680 --> 0:33:07.200 but technology that can help reduce the carbon footprint and 0:33:07.400 --> 0:33:12.040 create greater capacity for green energy, both in creation, in transmission, 0:33:12.480 --> 0:33:15.040 and storage. So yeah, we're not looking back, we're looking 0:33:15.080 --> 0:33:16.600 forward and it's an exciting future. 0:33:16.840 --> 0:33:20.080 Andy, you're in DC and I can imagine the conversations 0:33:20.080 --> 0:33:23.520 that you're having with either regulators or lawmakers. How would 0:33:23.560 --> 0:33:28.280 you describe the environment between US and China Right now? 0:33:29.080 --> 0:33:32.080 We're just a small player in a large world, and 0:33:32.720 --> 0:33:36.160 we're a privately owned company. We can't affect those issues. 0:33:36.640 --> 0:33:39.320 We are just going to move forward doing what we're doing, 0:33:40.160 --> 0:33:42.280 working with our customers in about one hundred and seventy 0:33:42.320 --> 0:33:45.480 countries and helping them meet the requirements of government in 0:33:45.560 --> 0:33:47.360 their various parts of the world. Of course, at the 0:33:47.400 --> 0:33:50.080 global level, we hope we can find common ground and 0:33:50.160 --> 0:33:52.480 help reduce the toxic political environment somewhat. 0:33:52.800 --> 0:33:55.840 That was Hiawa USA Chief Security Officer Andy Perty. To 0:33:55.960 --> 0:33:58.120 hear our full conversation with Andy head on over to 0:33:58.200 --> 0:34:01.160 our podcast feed that wraps up the first hour of 0:34:01.160 --> 0:34:03.800 the weekend edition of Bloomberg Business Week from Bloomberg Radio. 0:34:04.080 --> 0:34:06.400 Coming up in our next hour, our domestic cover story 0:34:06.480 --> 0:34:09.080 details a cryptocurrency scam for the ages. 0:34:09.560 --> 0:34:13.040 Plus our undercover reporting expert Guru. There's a lot of 0:34:13.120 --> 0:34:15.040 names we like to call him anyway, he takes us 0:34:15.120 --> 0:34:18.400 inside one of the world's most exclusive travel hotspots and 0:34:18.560 --> 0:34:21.560 reveals the secrets of the Mediterranean version of Pleasure Island. 0:34:22.120 --> 0:34:23.399 This is Bloomberg Business Week. 0:34:23.480 --> 0:34:26.040 I'm Carol Masser and I'm Tim Stanaveex. Stay with us. 0:34:26.080 --> 0:34:28.640 Today's top stories and global business headlines are coming up. 0:34:28.880 --> 0:34:32.920 Right now. You're listening to the Bloomberg Business Week Podcast. 0:34:33.239 --> 0:34:36.680 Catch us live weekday afternoons from three to six Easter on. 0:34:36.800 --> 0:34:40.040 Bloomberg Radio, the Bloomberg Business App, and YouTube. 0:34:40.280 --> 0:34:43.120 You can also listen live on Amazon Alexa from our 0:34:43.160 --> 0:34:47.240 flagship New York station, Just Say Alexa play Bloomberg eleven 0:34:47.320 --> 0:34:49.200 thirty plenty ahead. 0:34:49.200 --> 0:34:51.000 In our second hour of the weekend edition of Bloomberg 0:34:51.040 --> 0:34:53.839 Business Week, we are jeweling down on tech use both 0:34:53.880 --> 0:34:57.680 for good and for bad, as well as travel, including 0:34:57.760 --> 0:35:01.000 what our intrepid reporter Brandon Presser learned working as a 0:35:01.160 --> 0:35:04.759 night life fixer in Abisa or Abitha. What do you say? 0:35:05.080 --> 0:35:08.480 I say Abisa Abisa because I'm you know, not cool y. 0:35:09.719 --> 0:35:12.479 I did live in Spain for a semestery, but still, 0:35:13.160 --> 0:35:14.520 you know, I don't want to butcher it. 0:35:14.680 --> 0:35:16.200 We're going to take you there. It's a great story, 0:35:16.280 --> 0:35:19.680 you know, things like helicopters to and from and hangover 0:35:19.840 --> 0:35:22.759 cures with ivy injections and making sure there is lots 0:35:22.800 --> 0:35:25.400 and lots and lots of champ champagne. 0:35:25.400 --> 0:35:26.560 That champagne're talking about. 0:35:27.160 --> 0:35:30.120 Brandon takes us there because he that was his job undercover. 0:35:30.440 --> 0:35:32.680 Plus, with summer starting to slip away, we're going to 0:35:32.719 --> 0:35:34.960 get some tips on booking your next trip and when 0:35:35.040 --> 0:35:37.920 might be the best time to secure the lowest possible airfares. 0:35:38.080 --> 0:35:40.720 Sign me up first up this hour. This week's Domestic 0:35:40.800 --> 0:35:44.040 cover story excerpted from an upcoming book from Bloomberg News 0:35:44.080 --> 0:35:47.759 investigative reporter Zeke Fox. It's due out in September. It's 0:35:47.800 --> 0:35:50.320 a must read for anyone interested in the global knock 0:35:50.360 --> 0:35:52.640 on effects of what turned out to be a multi 0:35:52.719 --> 0:35:55.080 trillion dollar financial delusion. 0:35:54.920 --> 0:35:57.279 And sadly, the monetary fallout is only part of the 0:35:57.320 --> 0:36:00.319 story Zeke uncovers in his book It's called Number Up. 0:36:00.560 --> 0:36:04.120 Inside Crypto's Wild Rise and Staggering Fall. We get a 0:36:04.120 --> 0:36:06.200 sneak peek from the author himself as well as the 0:36:06.320 --> 0:36:08.320 editor of Bloomberg BusinessWeek, Joel Weber. 0:36:08.760 --> 0:36:12.919 This is an amazing excerpt. I'm so excited for Zeke 0:36:13.040 --> 0:36:16.080 in this book, Number Go Up. You can pre order 0:36:16.120 --> 0:36:18.680 your copy right now on Amazon dot com. Right Zeke, 0:36:18.800 --> 0:36:23.399 And uh, this is a little sneak peak of where 0:36:23.800 --> 0:36:27.200 some of the book goes. And we're just so tickled 0:36:27.239 --> 0:36:29.360 to have it as an excerpt in this current issue 0:36:29.400 --> 0:36:32.480 and as our cover story. And you know, we're talking 0:36:32.520 --> 0:36:35.840 about Zeke here, and you know, it all begins with 0:36:36.320 --> 0:36:41.160 this text that he got from a person named, quote 0:36:41.239 --> 0:36:42.200 unquote Vicky. 0:36:42.360 --> 0:36:43.640 Who is Vicky? 0:36:43.680 --> 0:36:44.640 And what text did you get? 0:36:44.760 --> 0:36:45.000 Zeke? 0:36:46.800 --> 0:36:49.719 Yeah, so Vicky gave me it, sent me a text 0:36:49.920 --> 0:36:52.600 out of nowhere saying like, Hi, David, how's it going 0:36:52.760 --> 0:36:55.840 or something like that, And like, I'm not David, obviously, 0:36:56.239 --> 0:36:58.759 so I've been getting a lot of these. I'm been 0:36:58.840 --> 0:37:01.520 kind of curious about that. So I decided to me. 0:37:01.640 --> 0:37:05.640 Yeah, Tim says he gets like Carol, get them. Yeah, 0:37:05.680 --> 0:37:08.400 I ignored delete reporter spam if you can, right, but 0:37:08.640 --> 0:37:12.680 you you wrote back, Yeah, And the. 0:37:12.960 --> 0:37:14.960 First part of this like it's probably about what you 0:37:15.000 --> 0:37:18.680 would assume. Where Vicky she tries to make friends with me. 0:37:19.120 --> 0:37:22.840 She's flirting a little bit, She's sending me suggestive pictures, 0:37:23.960 --> 0:37:29.399 and she's like a beautiful, heavily airshed young woman who 0:37:29.480 --> 0:37:31.279 claims to be in New York like me, but does 0:37:31.360 --> 0:37:33.240 not want to meet up, and none of her pictures 0:37:33.280 --> 0:37:36.520 actually look like she's in New York. And I'm waiting 0:37:36.560 --> 0:37:38.520 for her to try to scam me because I wanted 0:37:38.560 --> 0:37:40.840 to know how it works. And it takes like days 0:37:40.880 --> 0:37:45.319 before she's very patient before her true mission comes out, 0:37:45.360 --> 0:37:47.680 and she starts telling me about how good she is 0:37:47.760 --> 0:37:50.880 at bitcoin trading. And then finally, after like a lot 0:37:50.960 --> 0:37:53.640 of trying, she's like, okay, I'll let you in on it. 0:37:53.800 --> 0:37:59.120 Download this app and send me some of this cryptocurrency 0:37:59.200 --> 0:37:59.760 called tetor. 0:38:00.040 --> 0:38:02.480 What I love about it though, is how how slow 0:38:02.640 --> 0:38:06.080 she is. It's like, I mean, and this comes through 0:38:06.120 --> 0:38:08.800 in the excerpt, is like you're like encouraging her along 0:38:08.960 --> 0:38:10.680 to like, come on, get to the point where you're 0:38:10.719 --> 0:38:11.600 trying to scam me. 0:38:12.800 --> 0:38:14.960 I even I had to tell her that, like I 0:38:15.040 --> 0:38:17.600 really wanted a tesla, like I need to make money, 0:38:18.120 --> 0:38:20.759 like she just she was really wanted to make sure 0:38:20.800 --> 0:38:22.960 I was hooked before she went for the scam. 0:38:23.120 --> 0:38:23.920 So I sent her. 0:38:24.520 --> 0:38:27.400 Tether is like a it's a stable coin. It always 0:38:27.440 --> 0:38:30.280 costs a dollar because it's supposedly backed by real dollars 0:38:30.320 --> 0:38:31.560 in the bank. And you can go on any of 0:38:31.640 --> 0:38:34.879 your normal crypto apps like coinbase or crypto dot com 0:38:35.000 --> 0:38:38.319 or whatever, you can buy tether and then you send 0:38:38.400 --> 0:38:42.719 them to VICKI at her supposedly like magic cooin trading app, 0:38:42.960 --> 0:38:46.160 and so all that involves is getting Vicky said. Vicky 0:38:46.200 --> 0:38:47.680 gave me her address. I mean, she walked me through 0:38:47.680 --> 0:38:50.920 it very carefully, and I sent her one hundred tethers 0:38:51.080 --> 0:38:54.719 from like a normal trading app to her special app 0:38:54.719 --> 0:38:56.560 where I was going to make this like big score. 0:38:56.920 --> 0:38:59.480 But as soon as I sent it, she started telling 0:38:59.520 --> 0:39:01.919 me like I need to send more, at which point 0:39:01.920 --> 0:39:04.120 I felt like it had gone far enough. I told 0:39:04.120 --> 0:39:08.120 her I was a reporter, and she disappeared. But the 0:39:08.239 --> 0:39:10.800 part where the story gets really dark and really weird 0:39:11.360 --> 0:39:14.239 is when I tried to figure out who is on 0:39:14.320 --> 0:39:16.560 the other end of these messages. Like, who could Vicky B. 0:39:17.080 --> 0:39:18.880 I want to slow you down before I let you 0:39:19.000 --> 0:39:22.960 go there, Uh the great revel Yeah, which, that's it, right, 0:39:23.120 --> 0:39:25.279 you know part of what the book is so much 0:39:25.320 --> 0:39:27.520 bigger than just this. Right, keep in mind this is 0:39:27.560 --> 0:39:29.800 an excerpt, and Zike, I do want to just like 0:39:29.920 --> 0:39:33.320 back up for a second and talk about how you 0:39:33.560 --> 0:39:35.799 ended up having this book at all. 0:39:36.120 --> 0:39:38.319 Well, I was I was hoping that I was hoping 0:39:38.360 --> 0:39:42.000 that you would because good this really started. This started, 0:39:42.120 --> 0:39:46.560 like you know, it's almost two years ago, maybe even 0:39:46.560 --> 0:39:48.520 a little more than two years ago. Joel came by 0:39:48.680 --> 0:39:51.760 my desk and I had not been reporting on crypto 0:39:51.800 --> 0:39:55.440 at all. I tend to write about like weird stuff 0:39:55.480 --> 0:39:58.280 going on on Wall Street, but I sort of resisted 0:39:58.680 --> 0:40:01.960 crypto as a topic. Like most of you listening to 0:40:02.040 --> 0:40:04.520 this you probably feel like I'm never going to get 0:40:04.560 --> 0:40:07.440 it and like the constant like boosterism is kind of 0:40:07.480 --> 0:40:10.000 a turn off. But Joel said, hey, what do you 0:40:10.120 --> 0:40:14.839 know about stable coins like tether? And I thought, huh, 0:40:14.880 --> 0:40:17.520 I mean, maybe like this wants I mean, if Joel 0:40:17.520 --> 0:40:19.040 wants the story, it might be kind of fun to 0:40:19.760 --> 0:40:23.040 look into it. But I'm sure that neither of us 0:40:23.080 --> 0:40:26.200 had any idea where looking into Tether was was going 0:40:26.239 --> 0:40:26.879 to take us. 0:40:27.080 --> 0:40:31.080 Now, certainly not me. And we've had you know, great 0:40:31.160 --> 0:40:33.560 reporting from Zeke on Tether and more of Crypto along 0:40:33.600 --> 0:40:38.520 the way, because the Tether part is ultimately this other 0:40:38.640 --> 0:40:41.600 side of your story about you know, quote unquote Vicky 0:40:42.200 --> 0:40:44.560 takes you and I will say, this is where it 0:40:44.600 --> 0:40:47.480 gets dark. We've been kind of laughing. Ha ha ha, 0:40:48.440 --> 0:40:52.080 it gets dark really quickly here, Zeke. And why don't 0:40:52.080 --> 0:40:56.080 you take us to this human rights catastrophe that you discovered? Yeah, 0:40:56.239 --> 0:40:57.080 on the other side of the world. 0:40:58.200 --> 0:41:03.279 The truth, as I learned through activists and reporters on 0:41:03.400 --> 0:41:06.000 the ground in Southeast Asia, is that the people who 0:41:06.120 --> 0:41:11.560 send these text messages are themselves often victims of human trafficking. 0:41:12.160 --> 0:41:17.920 And there's whole office buildings of people who've been learned 0:41:18.080 --> 0:41:21.120 to say, like Cambodia is a popular spot for this, 0:41:21.760 --> 0:41:23.719 and they've been lured there with the promise of a 0:41:23.760 --> 0:41:28.160 good job. Once they arrive, they're trapped and they're forced 0:41:28.200 --> 0:41:31.719 to scam people under with the threat of beatings or 0:41:31.800 --> 0:41:35.600 torture or even worse. And it sounds like some sort 0:41:35.640 --> 0:41:39.520 of like QAnon conspiracy thing, but like it's real These 0:41:39.600 --> 0:41:43.200 messages are often coming from people who are suffering like 0:41:43.280 --> 0:41:47.800 horrible abuses and can't leave unless they pay essentially like 0:41:47.880 --> 0:41:51.320 a large ransom to the gangsters that run these scam compounds. 0:41:51.719 --> 0:41:54.759 Can you Zeke talk about who you met in Ho 0:41:54.920 --> 0:41:59.080 Chiman City and how he was able to escape from 0:41:59.160 --> 0:42:02.839 this one of these sort of prison like structures. 0:42:04.040 --> 0:42:06.840 Over a video chat with the translator. I started interviewing 0:42:06.880 --> 0:42:11.520 people who had escaped from these compounds. One of them, 0:42:11.960 --> 0:42:16.800 his name is Twee. He's twenty nine years old. The 0:42:16.880 --> 0:42:20.560 first time we speak on Zoom's it's like a rainy 0:42:20.640 --> 0:42:24.000 night in Ho Chi Minh City. He's walking down the 0:42:24.080 --> 0:42:27.120 street smoking a cigarette. I can see that he's missing 0:42:27.160 --> 0:42:29.560 quite a few teeth, and he tells me that these 0:42:29.600 --> 0:42:34.080 were he lost them in like a horrible beating by 0:42:34.120 --> 0:42:38.200 his captors, and it was truly a desperate situation. He'd 0:42:38.239 --> 0:42:45.719 been tricked into, tricked into going to Cambodia, and he 0:42:46.600 --> 0:42:53.000 was only able to escape by stealing a guard's phone 0:42:54.960 --> 0:42:58.480 then hiding it in his rectum, which was a trick 0:42:58.560 --> 0:43:02.600 that he'd learned in prison. Then and like he's telling 0:43:02.640 --> 0:43:04.560 me this stuff and it's it's pretty hard to believe. 0:43:07.080 --> 0:43:10.320 He told me that he was able to take the 0:43:10.400 --> 0:43:13.280 phone apart with no tools, and then since he didn't 0:43:13.280 --> 0:43:17.000 have a charger, he hot wired the battery to a 0:43:17.360 --> 0:43:20.239 fluorescent light fixture in the ceiling of the room where 0:43:20.280 --> 0:43:23.919 he's being held. So he had been a great source 0:43:23.960 --> 0:43:29.120 of information about these schemes and about these scam compounds 0:43:29.160 --> 0:43:31.600 and Cambodia. But I wasn't quite sure about this part 0:43:31.600 --> 0:43:34.880 of the story. So I went to Hochi Mi in 0:43:34.920 --> 0:43:38.000 the city. I met him. With him, I told him 0:43:38.080 --> 0:43:40.600 like tweet like, I'm so sorry for what's happened to you. 0:43:41.480 --> 0:43:43.400 I hate to say this though, but like, is that 0:43:43.560 --> 0:43:47.440 even really possible to charge an iPhone like that and 0:43:47.680 --> 0:43:51.480 with no hesitation? Well, he said, uh yeah, he said, 0:43:51.719 --> 0:43:55.640 I'll show you right now, went to the store, bought 0:43:55.760 --> 0:43:58.880 like a old iPhone for about fifty bucks, and with 0:43:59.000 --> 0:44:02.000 no hesitation, he took it apart, took apart a lamp 0:44:02.120 --> 0:44:05.760 an led light bulb in my room hotel room, wired 0:44:05.800 --> 0:44:08.800 it to the battery and God should turn on. 0:44:09.480 --> 0:44:12.520 So it was so you can do that. 0:44:12.640 --> 0:44:13.600 Incredibly impressed. 0:44:13.800 --> 0:44:15.879 We have about a minute left here, Zeke, and there's 0:44:16.200 --> 0:44:17.840 we know so much more in your book but this 0:44:18.120 --> 0:44:22.040 particular excerpt, I mean, how does it make you think 0:44:22.239 --> 0:44:24.960 kind of about you know, this the crypto world where 0:44:25.000 --> 0:44:26.920 we are a lot of questions out there. 0:44:27.800 --> 0:44:30.600 To me, this is like the one I looked all 0:44:30.640 --> 0:44:35.040 over the world from like El Salvador, Philippines, Bahamas, everywhere 0:44:35.040 --> 0:44:38.080 I went. Crypto was not really living up to the 0:44:38.200 --> 0:44:43.040 hype here. Sadly, it was extremely useful for these scammers, 0:44:43.360 --> 0:44:47.200 and to me it explained it could. These types of 0:44:47.280 --> 0:44:51.360 illicit uses could explain a big part of Crypto's continued 0:44:51.440 --> 0:44:54.640 popularity in the face of like so many reasons to 0:44:54.719 --> 0:44:55.080 avoid it. 0:44:55.200 --> 0:44:58.399 Now our thanks to Bloomberg News investigative reporter Zeke Fox 0:44:58.480 --> 0:45:01.399 and Bloomberg business Week editor Joe Weber. Zeke's new book 0:45:01.480 --> 0:45:04.520 Number Go Up, Inside Crypto's wild Rise and Staggering Fall, 0:45:05.000 --> 0:45:06.440 is due for release in September. 0:45:06.600 --> 0:45:09.120 You're listening to Bloomberg business Week. Coming up, we've spotlight 0:45:09.160 --> 0:45:13.120 an organization that's bringing opportunity and education to young women 0:45:13.320 --> 0:45:17.239 and underrepresented groups in the field of computer science, the. 0:45:17.239 --> 0:45:19.800 Team from Code with Class on its mission to inspire 0:45:19.880 --> 0:45:22.439 a love for technology in young people. That's next. 0:45:22.800 --> 0:45:27.640 This is Bloomberg. You're listening to the Bloomberg Business Week Podcast. 0:45:27.960 --> 0:45:31.800 Catch us live weekday afternoons from three to six Eastern Listen. 0:45:31.680 --> 0:45:35.600 On Bloomberg dot com, the iHeartRadio app and the Bloomberg. 0:45:35.200 --> 0:45:37.800 Business app, or watch us live on YouTube. 0:45:38.360 --> 0:45:40.799 Get this get a number free, mister, stand of it. Okay, 0:45:40.920 --> 0:45:43.600 less than twenty percent of undergraduate computer science degrees go 0:45:43.719 --> 0:45:47.320 to women, less than twenty percent, and that data is 0:45:47.360 --> 0:45:50.160 coming from the National Science Foundation, So that means four 0:45:50.360 --> 0:45:53.080 out of every five degrees, four out of every five 0:45:53.200 --> 0:45:55.600 in an industry already dominated by men. Have you seen 0:45:55.640 --> 0:45:59.919 the barbiemovie Anybody go to Men? And our next guests 0:46:00.040 --> 0:46:01.920 trying to change it and get more young women and 0:46:02.040 --> 0:46:03.120 individuals into coding. 0:46:03.280 --> 0:46:06.640 Yeah, very pleased to have with us this afternoon. Oz Emiokparia, 0:46:06.760 --> 0:46:09.239 the CEO of Code with CLASSI. Also with us is 0:46:09.600 --> 0:46:13.560 kwk's content and community coordinator, Alexis Williams. KWK is a 0:46:13.640 --> 0:46:17.560 nonprofit organization. It receives funding from Bloomberg Philanthropies, the philanthropic 0:46:17.680 --> 0:46:20.200 arm of Bloomberg LP. It is the parent company of 0:46:20.680 --> 0:46:23.640 Bloomberg Radio. Oz I want to start with you just 0:46:23.880 --> 0:46:26.600 talk to us a little about this organization because it's 0:46:26.640 --> 0:46:27.799 doing some really important work. 0:46:27.960 --> 0:46:31.400 Yeah. So COVID CLASSI started in twenty fifteen and is 0:46:31.480 --> 0:46:35.120 the brainchild of our founder, Carly Klass. So for those 0:46:35.160 --> 0:46:40.840 who are familiar, Carli Class is an incredible entrepreneur, supermodel, philanthropist, 0:46:40.960 --> 0:46:43.560 and she started this organization back in twenty fifteen based 0:46:43.560 --> 0:46:47.320 on her own personal experience learning how to code and 0:46:47.520 --> 0:46:49.880 noticing when she lifted her head up from the keyboard 0:46:49.960 --> 0:46:52.040 that there weren't other women in the room. And so 0:46:52.560 --> 0:46:55.839 she used her platform, as she has done many a time, 0:46:56.080 --> 0:46:58.560 to reach out to her audience and say who else 0:46:58.600 --> 0:47:01.440 would want to have this co V experience? And she 0:47:01.600 --> 0:47:05.319 was overwhelmed by the response from her audience. Twenty one 0:47:05.400 --> 0:47:08.320 scholarship positions and she had thousands of people interested, and 0:47:08.400 --> 0:47:10.800 that was the germ for Code with Closi back in 0:47:10.840 --> 0:47:11.440 twenty fifteen. 0:47:11.960 --> 0:47:13.520 And so here we are eight years later. 0:47:13.880 --> 0:47:16.800 And we now have over ten thousand young people in 0:47:16.920 --> 0:47:21.239 our alumni community. And this summer we are about to 0:47:21.320 --> 0:47:25.680 wrap up our biggest summer ever, sixty two camps, almost 0:47:25.760 --> 0:47:28.719 five thousand scholarships awarded, and we're kind of on a 0:47:28.800 --> 0:47:30.480 role I want to bring Alexi cinemament. 0:47:30.520 --> 0:47:32.600 But tell us about those alumni eight years that's a 0:47:32.600 --> 0:47:36.080 big chunk of individuals and time invested. What are they 0:47:36.160 --> 0:47:38.279 doing now? What are you hearing about that alumni base. 0:47:38.440 --> 0:47:41.239 Yeah, so our oldest cohort of alumni who went through 0:47:41.280 --> 0:47:44.719 our summer programming started in twenty sixteen, and so those 0:47:44.800 --> 0:47:47.920 folks are now twenty twenty five years old. So they 0:47:47.960 --> 0:47:51.759 are graduating from university, they're getting their first jobs all 0:47:51.800 --> 0:47:53.960 the way through the cohort that we have this summer, 0:47:54.040 --> 0:47:56.840 who are some of our youngest scholars the summer thirteen 0:47:57.280 --> 0:47:59.399 and so when they complete this program, they will join 0:47:59.480 --> 0:48:01.920 our global community. And so they're doing a range of 0:48:02.000 --> 0:48:05.839 things from you know, giving ted talks like Alexis has done, 0:48:06.040 --> 0:48:08.960 or winning science challenges. We had a winner of the 0:48:09.040 --> 0:48:12.239 Apple Swift Student Challenge. So they're really just sort of 0:48:12.320 --> 0:48:16.080 incredibly applying their skills and continuing to sort of pursue 0:48:16.080 --> 0:48:16.799 their passion in tech. 0:48:17.080 --> 0:48:18.719 Alexis, come on in on the work that you guys 0:48:18.760 --> 0:48:22.800 are doing and just kind of building out this community 0:48:22.880 --> 0:48:23.719 and what you are seeing. 0:48:24.200 --> 0:48:26.319 Yeah, I just think one of the most amazing things 0:48:26.360 --> 0:48:29.400 about Code with CLASSI is so many people are interested 0:48:29.400 --> 0:48:32.160 in engineering in general, but I feel like it sounds 0:48:32.239 --> 0:48:36.120 something so you know, difficult and challenging. But the work 0:48:36.160 --> 0:48:39.400 that Code with Classi does is really demystifying that idea 0:48:39.440 --> 0:48:41.400 of what is an engineer, What does it mean to 0:48:41.440 --> 0:48:43.400 make an app? What does it mean to make a website? 0:48:43.760 --> 0:48:47.880 So it's really amazing to offer this opportunity to a 0:48:47.920 --> 0:48:51.440 bunch of young people to have that demystified, to make 0:48:51.480 --> 0:48:54.200 their first apps, to make their first websites, because I 0:48:54.280 --> 0:48:57.520 think that's like one of the first steps into showing 0:48:57.680 --> 0:49:01.000 people who have been pushed to the margins like engineering, 0:49:01.360 --> 0:49:03.879 that it's not only possible, but there are a group 0:49:03.920 --> 0:49:06.520 of people out there that are more than willing and 0:49:06.640 --> 0:49:09.120 able to support them. And that's why the work that 0:49:09.200 --> 0:49:10.120 Code with Colossi does. 0:49:10.080 --> 0:49:12.800 Is we talk so much about inclusivity, and when you 0:49:12.880 --> 0:49:15.279 said push to the margins, tell us about some of 0:49:15.320 --> 0:49:18.200 the individuals, like who is actually participating in the program? 0:49:18.280 --> 0:49:20.480 Because I agree with you, I hear more and more 0:49:20.480 --> 0:49:23.360 when we talk about diversity, it's about inclusion, feeling like 0:49:23.400 --> 0:49:26.000 you're belonging in that if you know, you might be curious, 0:49:26.120 --> 0:49:28.719 but you're just like I don't belong Yeah. 0:49:28.920 --> 0:49:32.080 So Code with Colossi opens its doors to young women, 0:49:32.640 --> 0:49:36.239 gender expansive youth and trans kids, and really it's one 0:49:36.280 --> 0:49:39.040 of the first places where I talk to scholars all 0:49:39.040 --> 0:49:40.920 the time, they're like, this is the first place I've 0:49:40.920 --> 0:49:45.440 felt welcome and accepted. And that is honestly more important 0:49:45.680 --> 0:49:48.359 than being able to learn how to code, like having 0:49:48.400 --> 0:49:50.640 it be a space having code with CLASSI be a 0:49:50.680 --> 0:49:52.919 space where this is one of the first times people 0:49:52.920 --> 0:49:55.359 are walking into a room and feel like they're being 0:49:55.440 --> 0:49:57.600 received with open arms is so important. 0:49:57.880 --> 0:49:59.759 We talk about tim and I have so many different 0:49:59.800 --> 0:50:02.680 co about diversity inclusion. We do it with women in 0:50:02.760 --> 0:50:05.080 venture capital and lack of funding and so on and 0:50:05.160 --> 0:50:08.240 so forth. But you know, there needs to be these important, 0:50:08.480 --> 0:50:11.640 big steps that are game changing, life changing, that really 0:50:11.680 --> 0:50:12.280 make a difference. 0:50:12.360 --> 0:50:14.160 And I think it's what's interesting is I think there's 0:50:14.239 --> 0:50:16.759 diversity on a lot of dimensions. About half of our 0:50:16.800 --> 0:50:19.719 scholars qualify for free and reduced lunch, so we have 0:50:19.840 --> 0:50:24.040 socioeconomic diversity. We also have folks that come in actually 0:50:24.160 --> 0:50:27.040 knowing how to code. So to Alexis's point, what they 0:50:27.080 --> 0:50:29.000 are coming for is not just the rigor of the 0:50:29.080 --> 0:50:32.759 skill building, but also the inclusion and acceptance. And so 0:50:33.160 --> 0:50:36.440 we're finding this really interesting mix of people that you 0:50:36.440 --> 0:50:40.879 wouldn't necessarily find out in the world naturally gravitating into 0:50:40.920 --> 0:50:43.799 these same spaces. Again, eighty percent of our scholars are 0:50:43.800 --> 0:50:47.360 people of color, so you know, not only gender and diversity, socioeconomic, 0:50:47.719 --> 0:50:51.280 skill level, political spectrum. We are sort of a space 0:50:51.400 --> 0:50:54.600 that welcomes all in terms of trying to crack open 0:50:54.719 --> 0:50:56.360 the door to a community. 0:50:56.760 --> 0:50:58.560 I want to talk to you, Ozie about the way 0:50:58.600 --> 0:51:00.840 that your own experience at some the biggest company, some 0:51:00.840 --> 0:51:02.960 of the biggest tech companies in the world, kind of 0:51:03.040 --> 0:51:05.160 shaped the kind of leader you are today. 0:51:05.360 --> 0:51:06.600 Did you always feel like you belonged? 0:51:06.800 --> 0:51:08.759 Well, that's what I'm wondering. I mean, you were at 0:51:08.800 --> 0:51:11.239 Google for years, you were at EBA for years, you 0:51:11.320 --> 0:51:13.080 were in the not for profit space at the John 0:51:13.160 --> 0:51:16.680 Zuckerberg Initiative before this, talk to me a little bit 0:51:16.680 --> 0:51:18.759 about I don't know your experience and what you want 0:51:18.800 --> 0:51:20.680 to bring to the table, like carolss did you did 0:51:20.719 --> 0:51:21.640 you always feel accepted? 0:51:21.680 --> 0:51:21.799 Well? 0:51:21.800 --> 0:51:23.560 I think that's I think that's why I was so 0:51:23.719 --> 0:51:26.839 drawn to the COVID classy opportunity. So I joined COVID 0:51:26.880 --> 0:51:29.200 COLOSSI back in March. So I'm coming up on six 0:51:29.320 --> 0:51:32.160 months and so I have lived experience as a black 0:51:32.320 --> 0:51:35.839 woman in tech and often the only one in many 0:51:35.920 --> 0:51:38.719 of these rooms, and I think, you know, I definitely 0:51:38.840 --> 0:51:41.520 did not always feel accepted. I think there was a 0:51:41.560 --> 0:51:44.840 tipping point in my career where you feel like you 0:51:45.120 --> 0:51:49.799 have built your craft and understand your skills well enough 0:51:49.840 --> 0:51:52.640 to sort of feel comfortable in rooms, but you definitely 0:51:52.680 --> 0:51:54.239 build to that. It's not something that you sort of 0:51:54.280 --> 0:51:57.759 walk in the door having or knowing. But I think 0:51:57.840 --> 0:52:01.480 what that experience taught me is that we not only 0:52:01.560 --> 0:52:05.960 have to focus on upskilling the individual and providing incredible 0:52:06.000 --> 0:52:08.719 programs like we do at COVID Classy, but we also 0:52:08.840 --> 0:52:11.920 have to think about what are the systems that prevent 0:52:12.120 --> 0:52:16.359 people from being successful. So I would claim that I'm 0:52:16.400 --> 0:52:19.440 quite credentialed right Stanford undergrad master's degree. 0:52:19.239 --> 0:52:21.720 Like so all the credential underachiever. 0:52:22.400 --> 0:52:26.160 But still found challenges. So it's not about the individual talent. 0:52:26.880 --> 0:52:29.719 There are also hurdles that are systemic, and so really 0:52:29.840 --> 0:52:32.880 thinking about that holistically is what we are going to 0:52:33.000 --> 0:52:35.400 do in the next eight years of Code with Colossi's 0:52:35.760 --> 0:52:39.000 path is to say we're doing an incredible job of 0:52:39.160 --> 0:52:42.000 sparking the interest of a new generation, but what are 0:52:42.040 --> 0:52:46.200 we doing with companies like Bloomberg and others to really 0:52:46.239 --> 0:52:48.040 think about the systems on the other side, what are 0:52:48.080 --> 0:52:51.759 the practices around hiring and retention and promotion that are 0:52:51.840 --> 0:52:54.040 really going to create opportunities for people. 0:52:54.160 --> 0:52:55.800 Well, and you know we've often talked about this with 0:52:55.920 --> 0:52:57.640 just women. I'm just going to be very basic in 0:52:57.760 --> 0:53:00.960 terms of you know, women come in men at a college, 0:53:01.320 --> 0:53:02.920 they start at the same level, and then as they 0:53:02.960 --> 0:53:05.360 start to go up the last it gets very very different. 0:53:05.360 --> 0:53:08.600 So where's the support network for that? Alexis come on 0:53:08.680 --> 0:53:11.719 back and it's a two week summer camp. I want 0:53:11.719 --> 0:53:13.560 to see if I've got the numbers right. Sixty two camps, 0:53:13.640 --> 0:53:16.879 forty in person in twenty cities, twenty two virtual. It's 0:53:16.960 --> 0:53:19.520 like massive thirteen to eighteen year olds. So what do 0:53:19.600 --> 0:53:20.600 they do in those two weeks? 0:53:21.120 --> 0:53:25.680 So basically we have four different curriculums where a scholars 0:53:25.760 --> 0:53:30.160 are learning the basics two different curriculums like mobile applications, 0:53:30.239 --> 0:53:35.040 Web development, AIML, data science, and it's a short two 0:53:35.080 --> 0:53:38.360 week period, so they're learning really basics and getting to 0:53:38.600 --> 0:53:40.400 build off of that basics that they learn in the 0:53:40.480 --> 0:53:42.759 first week with a final project in the second week. 0:53:43.040 --> 0:53:45.560 So it's important that they're setting down, yeah, and getting 0:53:45.600 --> 0:53:47.920 their education, but then they get to actually put it 0:53:47.960 --> 0:53:49.719 into practice and then at the end of camp show 0:53:49.760 --> 0:53:52.239 their peers, show their families the great things that they're making. 0:53:52.680 --> 0:53:55.880 What's the youngest age that somebody can can join thirteen and. 0:53:55.960 --> 0:53:59.320 So what I think is remarkable again you know, diversity 0:53:59.360 --> 0:54:01.480 and age range. You have thirteen year olds who step 0:54:01.600 --> 0:54:03.560 up their game to be in the room with eighteen 0:54:03.640 --> 0:54:05.799 year olds who are also learning these skills, and it's 0:54:05.960 --> 0:54:09.040 again it's an application not only the hard skills, but 0:54:09.200 --> 0:54:12.280 some of the what I call twenty first century leadership 0:54:12.320 --> 0:54:17.120 skills around collaboration and critical thinking and creativity that are 0:54:17.160 --> 0:54:19.840 really also applied in that final project as well. So 0:54:20.080 --> 0:54:22.799 it really is incredible to see thirteen year olds sort 0:54:22.800 --> 0:54:24.000 of hanging tough there. 0:54:24.200 --> 0:54:27.440 Our thanks to Code with class e ceo oc Inmeokaparia 0:54:27.600 --> 0:54:30.120 and its content community coordinator Alexis Williams. 0:54:30.280 --> 0:54:32.359 Still to come on Bloomberg Business Week, there is still 0:54:32.440 --> 0:54:34.680 time to get some summer travel in and so next 0:54:34.760 --> 0:54:37.239 half hour we go behind the scenes, have a beta's 0:54:37.600 --> 0:54:39.879 Ultracompetitive Conciers circuit. 0:54:39.800 --> 0:54:43.319 And talk about why airline ticket prices are actually falling well, 0:54:43.800 --> 0:54:45.799 at least for now. In the US. 0:54:46.360 --> 0:54:47.440 This is Bloomberg. 0:54:47.880 --> 0:54:51.400 You're listening to the Bloomberg Business Week podcast. Catch us 0:54:51.480 --> 0:54:54.880 live weekday afternoons from three to six Eastern Listen. 0:54:54.719 --> 0:54:57.640 On Bloomberg dot Com, the iHeartRadio app. 0:54:57.440 --> 0:55:00.200 And the Bloomberg Business app, or watch just Low I've 0:55:00.280 --> 0:55:02.120 on YouTube time. 0:55:02.040 --> 0:55:05.240 For Bloomberg pursuits and this week's opener includes another riveting 0:55:05.320 --> 0:55:08.040 and funny tail of the reporter that goes behind the scenes. 0:55:08.080 --> 0:55:10.319 We always look forward to what he does. He works 0:55:10.360 --> 0:55:14.040 at exclusive spas on cruise ships at Disney World, at Lax, 0:55:14.200 --> 0:55:17.560 New York's Plaza Hotel. He gets the inside scoop and 0:55:17.680 --> 0:55:19.440 finds out what exactly goes on. 0:55:19.840 --> 0:55:19.960 Well. 0:55:20.000 --> 0:55:22.759 This time around, Brandon Presser spent a week working as 0:55:22.800 --> 0:55:26.880 a concierge at a luxury villa booking agency in at Bitha. 0:55:27.239 --> 0:55:28.600 Do I say that right, Brandon. 0:55:30.280 --> 0:55:31.120 In your place? 0:55:33.800 --> 0:55:34.040 Okay? 0:55:34.120 --> 0:55:36.480 This is where week long rentals can easily reach well 0:55:36.520 --> 0:55:40.800 over three hundred thousand dollars. Brandon joins us along with 0:55:40.800 --> 0:55:43.719 Bloomberg News Travels are Nikki Eckstein Nikki. Every time we 0:55:43.800 --> 0:55:47.640 think Brandon can't pull off another one of these inside jobs, 0:55:47.680 --> 0:55:51.840 he outdoes himself yet again, this time in the island 0:55:52.200 --> 0:55:52.760 of Abitha. 0:55:53.760 --> 0:55:55.759 I feel the same way. I feel like we've been 0:55:55.800 --> 0:55:58.480 doing this serious first six or seven years now, and 0:55:58.800 --> 0:56:00.680 every time that we come up with a new idea 0:56:00.920 --> 0:56:03.760 is just boggles my mind. The extent to words Brandon 0:56:03.800 --> 0:56:07.120 commits to these jobs and digs up the craziest stories 0:56:07.280 --> 0:56:08.319 ever imaginable. 0:56:08.600 --> 0:56:10.600 All right, this was definitely a slice of a very 0:56:10.640 --> 0:56:12.840 different life from mine. So Brandon, come on in. You 0:56:12.920 --> 0:56:15.279 are actually at an airport as we're talking, because you're 0:56:15.360 --> 0:56:17.920 constantly traveling in on the road. Tell us about what 0:56:18.040 --> 0:56:19.120 you did in Abitha. 0:56:20.560 --> 0:56:24.840 Well, this one, this one was really interesting because what 0:56:24.960 --> 0:56:26.520 I like to do is I like to focus on 0:56:26.600 --> 0:56:29.440 sort of the averages and the extremes, because you know, 0:56:29.480 --> 0:56:31.880 when you go behind the curtain of hospitality, both of 0:56:31.960 --> 0:56:35.080 those things are really interesting. But on an island it 0:56:35.200 --> 0:56:38.000 sort of becomes this pressure cooker. So there was a 0:56:38.040 --> 0:56:42.120 lot of really interesting social dynamics and status anxiety that 0:56:42.320 --> 0:56:43.319 was at play as well. 0:56:43.520 --> 0:56:46.480 Who are these people who are spending three hundred grand 0:56:47.239 --> 0:56:49.520 for a week on Abiza? 0:56:49.600 --> 0:56:51.160 Come on, Tim, you did that last week, didn't you. 0:56:52.000 --> 0:56:53.719 It's because you in your piece. You of like it's 0:56:53.840 --> 0:56:55.600 it's like a kind of a diverse group of very 0:56:55.640 --> 0:56:58.680 wealthy people, like executives from Apple have been there. Who 0:56:59.200 --> 0:56:59.839 who else is there? 0:57:00.680 --> 0:57:04.640 I mean it's every celebrity and influential person imaginable. And 0:57:04.760 --> 0:57:07.440 I think in the way that you think of wearing 0:57:07.800 --> 0:57:11.800 like an a low hush shirt to Hawaii, everyone dresses 0:57:12.040 --> 0:57:15.600 in this sort of boho chic. Everyone puts on their 0:57:15.800 --> 0:57:20.280 cosplaying macro mat and linen and ratan and really gets 0:57:20.320 --> 0:57:21.320 into the vibe. 0:57:21.960 --> 0:57:23.920 I haven't been somewhere at my home that's full of 0:57:23.960 --> 0:57:25.840 that kind of stuff. All right, Nikki, come on back 0:57:25.960 --> 0:57:27.960 in here. So, when you knew that this was the 0:57:28.000 --> 0:57:30.880 assignment for Brandon, what is it that you wanted to know? 0:57:31.280 --> 0:57:34.160 Tell us about kind of you know, the conversations back 0:57:34.200 --> 0:57:37.000 and forth here, Well, you know, it's always. 0:57:36.760 --> 0:57:38.760 Really funny because people will assume that we just want 0:57:38.760 --> 0:57:40.200 to kind of dig up the dirt wherever we go, 0:57:40.320 --> 0:57:42.560 and almost the opposite is true. What we're really looking 0:57:42.600 --> 0:57:44.840 for is what we call service heroics. Between the two 0:57:44.920 --> 0:57:46.920 of us, we're really trying to shine a light on 0:57:47.040 --> 0:57:49.960 how hard the hospitality industry works to make everybody happy, 0:57:50.080 --> 0:57:54.120 even when what they want is completely ludicrous and would 0:57:54.320 --> 0:57:57.320 make you just drop your jaw to the floor. Okay, 0:57:57.400 --> 0:57:59.800 but there are people who that's their job to take 0:57:59.840 --> 0:58:00.920 it and deliver. 0:58:01.320 --> 0:58:01.560 Okay. 0:58:01.640 --> 0:58:04.840 Speaking of completely ludicrous, Brandon, I wonder. 0:58:04.640 --> 0:58:06.360 Where you're going to go because there's a lot of 0:58:06.440 --> 0:58:07.200 ludacris here. 0:58:07.440 --> 0:58:12.760 I'm going to the nieces. The nieces, who are the 0:58:12.840 --> 0:58:15.160 nieces and the nephews the nieces. 0:58:15.440 --> 0:58:18.760 Well, the origin story is at this wonderful hotel, the 0:58:18.840 --> 0:58:22.840 Sergio On Hotel, very close to the patcha nightclub. There 0:58:22.880 --> 0:58:24.520 was a man a few years ago who arrived at 0:58:24.520 --> 0:58:27.840 the hotel with five beautiful women, and he introduced them 0:58:27.880 --> 0:58:32.680 to the staff as his nieces, and the moniker stuck. 0:58:33.120 --> 0:58:35.800 So anytime that there's an individual who comes to the 0:58:35.880 --> 0:58:38.880 hotel that isn't staying at the hotel, whether it be 0:58:39.000 --> 0:58:41.960 for thirty minutes or three hours or for the whole night, 0:58:42.600 --> 0:58:46.080 they are lovingly referred to as nieces or nephews. 0:58:46.560 --> 0:58:48.520 You always see that in movies too. Right now, it's 0:58:48.560 --> 0:58:52.240 like it's my niece. Wait wait, wait what you're eighty 0:58:52.400 --> 0:58:57.080 and she's twenty. Okay, tell us about also, Brandon, some 0:58:57.160 --> 0:58:58.720 of the kind of crazy things you did, I know 0:58:58.800 --> 0:59:02.920 that there was lots of champagne, there was the DJ. 0:59:03.640 --> 0:59:06.760 Let's go there because the DJ apparently it's not only 0:59:06.760 --> 0:59:10.480 about David Solomon at Goldman the DJ being god. It's 0:59:10.480 --> 0:59:13.240 apparently that you went there, Carroll, Well, didn't we all. 0:59:13.200 --> 0:59:13.640 Think it of? 0:59:13.800 --> 0:59:13.840 Like? 0:59:13.920 --> 0:59:15.880 I wonder if like on the side anyway, tell us 0:59:15.880 --> 0:59:17.960 about the DJs, Brandon, Well. 0:59:17.840 --> 0:59:20.360 I think the interesting thing is that, you know, there's 0:59:20.440 --> 0:59:23.080 all of these complicated personalities all over the island, but 0:59:23.160 --> 0:59:28.760 the DJ is God. Everyone worships the DJ, and I 0:59:28.800 --> 0:59:30.760 thought it was really interesting that when I was asking 0:59:30.800 --> 0:59:32.720 a lot of people through the bookings, you know, what 0:59:32.840 --> 0:59:35.200 are the biggest requests that the DJ's asked for. It 0:59:35.280 --> 0:59:37.880 turns out they're all pretty low key. None of them 0:59:37.960 --> 0:59:41.000 really drink. They all have kids. They kind of just 0:59:41.080 --> 0:59:43.320 hang out in their villas with their wives, you know, 0:59:43.400 --> 0:59:45.120 and then they go on stage at three in the 0:59:45.200 --> 0:59:47.680 morning and do their thing. But they're actually sort of 0:59:47.760 --> 0:59:51.320 the least dva e of all the people that I encountered, 0:59:51.320 --> 0:59:52.360 which I thought was kind of fun. 0:59:53.160 --> 0:59:55.720 What about when it comes to what people are eating. 0:59:56.040 --> 0:59:58.120 What people are well, it's more white people are drinking. 0:59:58.440 --> 1:00:00.680 Yeah, well, Carol already went into I mean, we didn't 1:00:00.680 --> 1:00:02.280 talk about the bathtub full of champagne, but. 1:00:02.320 --> 1:00:03.160 It's lots of bubbly. 1:00:03.840 --> 1:00:07.120 One of the most interesting things about being on the 1:00:07.200 --> 1:00:10.880 island was all the things that were unset and probably 1:00:10.880 --> 1:00:12.640 the things that I need to leave unseid here. 1:00:12.840 --> 1:00:17.720 Okay, fuel, that's our Brandon presser after dark, but we'll 1:00:17.760 --> 1:00:18.400 get that later. 1:00:18.560 --> 1:00:20.680 Yeah, go ahead that we'll get you through the night. 1:00:21.040 --> 1:00:22.280 Fuel. That will get you through the night. 1:00:22.320 --> 1:00:23.720 Okay, So get it, Nikki. 1:00:23.800 --> 1:00:26.960 Come on, and when you read through Brandon's story, I mean, like, 1:00:27.080 --> 1:00:29.640 what was it that just you were like, oh my god, 1:00:29.720 --> 1:00:30.480 this is incredible. 1:00:31.240 --> 1:00:34.120 Well, I have to tell you, guys, what publishes ultimately 1:00:34.160 --> 1:00:37.400 in the magazine is what burndon like two thousand words 1:00:37.440 --> 1:00:41.600 at most and maybe twenty five hundred words. Brandon will 1:00:41.640 --> 1:00:45.160 file these incredible digests to me that clock in at 1:00:45.240 --> 1:00:47.920 some like six seven thousand words. What I'm trying to 1:00:47.960 --> 1:00:50.200 say is that there is so much gold left on 1:00:50.240 --> 1:00:52.320 the cutting room floor, and I wish that we could 1:00:52.360 --> 1:00:54.920 go through all of it. But I think my favorite 1:00:55.000 --> 1:00:59.800 highlights are the bathtub of champagne, a literal bathtub of champagne. 1:01:02.320 --> 1:01:05.080 By the way, it starts at four thousand euro. If 1:01:05.080 --> 1:01:08.320 you're curious, maybe that's something you want to do. And 1:01:08.480 --> 1:01:11.640 I do love the food stories about people who think 1:01:11.680 --> 1:01:13.840 they're so fancy partying in Abisa, but really all they 1:01:13.880 --> 1:01:16.760 want is frozen pizza and like boodles and boodles of McDonald's. 1:01:16.800 --> 1:01:19.960 I just thought the juxtaposion of these things was absolutely hilarious. 1:01:20.040 --> 1:01:22.040 All right, So what I want to know too, Brandon, 1:01:22.280 --> 1:01:25.320 is like, yeah, there's tons of people, two million vacationers 1:01:25.360 --> 1:01:27.720 that arrive on the island right each summer. A lot 1:01:27.800 --> 1:01:30.680 of people summer, A lot of them are regulars. Regulars. 1:01:31.000 --> 1:01:33.080 Is there like something you do that's like you're just 1:01:33.240 --> 1:01:35.680 like totally like, I got this, I know how this works. 1:01:35.880 --> 1:01:37.400 And then you can tell the people who just don't 1:01:37.400 --> 1:01:37.880 have a clue. 1:01:39.280 --> 1:01:41.920 Yeah, you know, I was asking a lot of insiders 1:01:41.960 --> 1:01:44.760 on the island, people who live there, are spent majority 1:01:44.760 --> 1:01:47.080 of the year there, how do you tell the difference 1:01:47.200 --> 1:01:52.840 between the dress up and the real deal locals? And 1:01:54.400 --> 1:01:55.880 a new friend that I made on the island, he 1:01:56.040 --> 1:02:02.920 told me that the bigger that theer the brat. This 1:02:03.080 --> 1:02:04.840 is something that got rough on the cutting room floor, 1:02:04.880 --> 1:02:07.520 but I just thought it'd be really fun to include 1:02:07.600 --> 1:02:11.720 right now. And essentially the more you dress up, the 1:02:11.880 --> 1:02:13.120 more of a faker you are. 1:02:14.160 --> 1:02:16.320 Oh so dressed down, like if you're like full of 1:02:16.560 --> 1:02:19.120 like labels and brands, like people are like, yeah, you're 1:02:19.160 --> 1:02:19.800 not the real thing? 1:02:19.960 --> 1:02:20.360 Is that fair? 1:02:20.440 --> 1:02:20.520 Ye? 1:02:20.960 --> 1:02:26.720 Like he invited a crypto guru over to his villa 1:02:27.120 --> 1:02:29.000 to have dinner and he showed up with a hat 1:02:29.160 --> 1:02:31.160 so large it looked like a flying saucer. 1:02:32.760 --> 1:02:36.560 Maybe that's just how they do things in crypto land, Brandon, 1:02:36.600 --> 1:02:40.000 What about you know, showing up to a party and 1:02:40.080 --> 1:02:42.040 trying to get in if you don't actually have an RSVP. 1:02:43.720 --> 1:02:45.840 Well, so at the big clubs, you know, it's really 1:02:45.920 --> 1:02:47.520 just a swipe of a credit card. I mean you're 1:02:47.520 --> 1:02:49.840 looking at clubs out of a capacity of five, six, 1:02:49.920 --> 1:02:52.760 seven thousand people. But then there's all these different ways 1:02:52.840 --> 1:02:55.200 to get in. There's you know, if you're working on 1:02:55.240 --> 1:02:57.640 a BIS that you can actually get a worker's permanent 1:02:57.760 --> 1:03:00.200 it's basically a free pass to get in into of 1:03:00.240 --> 1:03:02.720 the clubs when you're off duty. And then you have 1:03:02.880 --> 1:03:05.720 these guest lists, and then there's the industry lists. So 1:03:05.880 --> 1:03:09.120 there's really all of these permutations for access, all right. 1:03:09.120 --> 1:03:12.520 Nikki We're saving the last question for you to get 1:03:12.680 --> 1:03:15.560 ask Brendan because you know this story inside and out. 1:03:15.560 --> 1:03:16.840 What do you want to ask him? As we get 1:03:16.920 --> 1:03:17.600 ready to wrap up? 1:03:18.840 --> 1:03:21.600 Oh God, why do I want to ask Brandon? Would 1:03:21.640 --> 1:03:24.560 you go back to Abisa ever again? In your whole 1:03:24.720 --> 1:03:25.240 entire life? 1:03:27.760 --> 1:03:29.120 No, I don't think so. 1:03:30.400 --> 1:03:33.480 I think that I had such a special and uniquely 1:03:33.920 --> 1:03:37.080 weird experience that I kind of want to live in 1:03:37.200 --> 1:03:41.080 that fantasy forever. And I think we need to do 1:03:41.160 --> 1:03:42.680 one of these amikonos next year. 1:03:42.840 --> 1:03:46.080 Oh, NIC's a good idea, and we'll carry your luggage. Hey, 1:03:46.200 --> 1:03:49.280 I do have actually one tiny, little last question. If 1:03:49.320 --> 1:03:51.640 you did go back to Abitha and you went to 1:03:51.720 --> 1:03:54.520 the concierge service, what would you ask them? Because you 1:03:54.640 --> 1:03:56.760 know that they will do just about anything. 1:03:57.920 --> 1:04:01.560 For the ultimate in Abusa Ax, you want a lounger edge, 1:04:01.600 --> 1:04:03.640 Gen Dahal, And so that would be the first thing 1:04:03.680 --> 1:04:05.560 that I would do, and just spend the day drinking 1:04:05.600 --> 1:04:08.120 a bloody marry edge and doll and watching all the 1:04:08.200 --> 1:04:11.360 other people experience their payings of status anxiety. 1:04:11.520 --> 1:04:13.280 What's John Dahal Just quickly. 1:04:13.760 --> 1:04:16.920 Very very cool beach club, the It's spot of the 1:04:16.960 --> 1:04:19.520 summer and not in. 1:04:19.560 --> 1:04:22.120 A big hat, right, because a big hat is a 1:04:22.280 --> 1:04:27.800 really big brad. We love, we Love, we Love. Another 1:04:27.960 --> 1:04:31.160 gem from the mind an undercover mastery of Bloomberg contributor 1:04:31.200 --> 1:04:34.440 Brandon Presser. Check out his latest work. It's the opener 1:04:34.440 --> 1:04:37.280 of this week's pursued section of Bloomberg Business Week. Find 1:04:37.320 --> 1:04:40.400 it online on newsstands on the terminal. Great artwork as 1:04:40.440 --> 1:04:42.880 well to accompany this piece, as always are thanks to Brandon, 1:04:42.960 --> 1:04:46.280 and of course Bloomberg News Travels are editor Nikki x Teime. 1:04:46.560 --> 1:04:49.040 You're listening to Bloomberg Business Week. Coming up, we got 1:04:49.080 --> 1:04:52.480 more on travel, not necessarily so pricing when we talked 1:04:52.480 --> 1:04:55.120 three hundred thousand dollars a week. Villa stays in Atbiza, 1:04:55.240 --> 1:04:58.440 but you know, more travel. Nonetheless, Tim, it's Abitha, Abitha, 1:04:58.480 --> 1:04:59.360 I'm sorry, all right. 1:04:59.600 --> 1:05:01.520 We're just trying to get an airfare that won't break 1:05:01.560 --> 1:05:04.360 the bank. Something much more down to earth. That story 1:05:04.400 --> 1:05:06.040 is coming up next. This is Bloomberg. 1:05:06.640 --> 1:05:10.160 You're listening to the Bloomberg Business Week podcast. Catch us 1:05:10.240 --> 1:05:13.600 live weekday afternoons from three to six Eastern Listen on. 1:05:13.640 --> 1:05:17.360 Bloomberg dot com, the iHeartRadio app, and the Bloomberg Business 1:05:17.440 --> 1:05:19.640 app or watch US Live on YouTube. 1:05:20.240 --> 1:05:22.960 The latest USCPI print showed that inflation was held down 1:05:23.000 --> 1:05:26.320 in part last month by declining airfare prices. So yay, 1:05:26.880 --> 1:05:30.760 we can finally finally afford airline tickets which have shut 1:05:30.880 --> 1:05:34.040 up on all of the travel demand, especially for overseas travel. 1:05:34.240 --> 1:05:36.880 Well to talk travel trends, airline ticket prices, and more, 1:05:36.960 --> 1:05:39.880 we welcome back to the program. Haley Berg, lead economist 1:05:39.920 --> 1:05:41.040 at the travel app Hopper. 1:05:41.560 --> 1:05:43.920 When we look at the domestic market, a lot of 1:05:44.000 --> 1:05:47.480 what we're seeing this year is being driven by increased 1:05:47.520 --> 1:05:51.680 capacity from airlines. We typically see a pretty tight relationship 1:05:51.760 --> 1:05:54.680 between fares and how many seats are available to book. 1:05:55.240 --> 1:05:58.480 Right now, we're above twenty nineteen levels. There are more 1:05:58.560 --> 1:06:01.640 seats available to book on detic airlines now than there 1:06:01.680 --> 1:06:05.080 were at this time in twenty nineteen. That, combined with 1:06:05.680 --> 1:06:08.960 better jet fuel prices down significantly from last year, still 1:06:09.000 --> 1:06:11.680 a ways to go compared to twenty n eighteen, and 1:06:12.000 --> 1:06:16.600 demanded opening up to international destinations, all has combined and 1:06:16.800 --> 1:06:20.080 has really added to a seasonal effect. Typically fares drop 1:06:20.160 --> 1:06:23.000 at this time of the year, but that's being compounded 1:06:23.080 --> 1:06:25.960 by this increase in supply shift in demand and some 1:06:26.120 --> 1:06:28.400 relief fun costs, and that's how we end up with 1:06:28.560 --> 1:06:32.760 prices about ten percent lower than last year and versus 1:06:32.800 --> 1:06:33.440 twenty nineteen. 1:06:33.960 --> 1:06:38.240 So did the international tickets are they just like totally 1:06:38.320 --> 1:06:40.880 exempt from this? We're saying because since demand is so high, 1:06:40.880 --> 1:06:42.720 International is continuing to be expensive. 1:06:43.680 --> 1:06:48.240 International remains extremely expensive on long haul routes. Think fares 1:06:48.280 --> 1:06:51.440 to Asia well over fourteen hundred dollars up almost sixty 1:06:51.520 --> 1:06:55.720 percent economy. That would be an average what we call 1:06:55.800 --> 1:06:58.320 a good deal price, so at economy based economy ticket 1:06:58.400 --> 1:07:00.360 pretty much anything excluding first or business. 1:07:00.480 --> 1:07:03.280 Okay, all right, so Asian? What about Europe? Specifically? 1:07:04.560 --> 1:07:08.320 Europe was very expensive this summer, peaks over fourteen hundred 1:07:08.360 --> 1:07:11.520 dollars a ticket, But we have seen significant improvement in 1:07:11.560 --> 1:07:13.840 the last couple of weeks. Some of that is seasonal, 1:07:14.080 --> 1:07:16.840 some of that is supply. Airlines have gotten back to 1:07:16.880 --> 1:07:20.800 about ninety seven percent of twenty nineteen capacity, so we 1:07:21.000 --> 1:07:24.320 have seen demand shift back international. If it feels like 1:07:24.400 --> 1:07:27.080 everyone you know is in Italy, it's because they probably are. 1:07:27.160 --> 1:07:29.360 Feel like the third person, like the third person to 1:07:29.440 --> 1:07:31.640 say that to me, everybody's going. But if you open 1:07:31.760 --> 1:07:35.000 up Instagram apparently where's the place to go? Sicily? Is 1:07:35.000 --> 1:07:36.320 it like the because of the white Lotus. 1:07:37.080 --> 1:07:39.560 We are definitely seeing some what we call set jetting, 1:07:39.760 --> 1:07:44.040 so Palermo and Tara Mina in Sicily are very popular. 1:07:44.400 --> 1:07:47.160 But then some of the usual suspects we see, the 1:07:47.160 --> 1:07:51.040 Amalfi Coast rome and Milan like Como very popular at 1:07:51.040 --> 1:07:51.640 this time of year. 1:07:51.800 --> 1:07:54.480 So what happens? Does it stay this way or then 1:07:54.560 --> 1:07:56.520 once we start to get closer to holidays it starts 1:07:56.600 --> 1:07:59.880 we start to see an uptick on the domestic front. 1:08:00.080 --> 1:08:02.240 We have a couple more weeks of these low fares. 1:08:02.320 --> 1:08:05.240 We're expecting them to bottom out this month, and then 1:08:05.280 --> 1:08:09.400 they'll start rising in late September early October when travelers 1:08:09.440 --> 1:08:13.080 are starting to plan those trips for Thanksgiving and Christmas, 1:08:13.520 --> 1:08:15.920 and we'll see them rise back to reach about pre 1:08:16.040 --> 1:08:19.120 pandemic levels. In December, we'll pretty much match where we 1:08:19.200 --> 1:08:21.920 were in twenty nineteen and twenty twenty two in December 1:08:22.000 --> 1:08:25.040 about too eighty a ticket if you're booking something. 1:08:24.840 --> 1:08:25.559 At the end of the year. 1:08:25.960 --> 1:08:28.479 Okay, so when should we be booking for holidays? 1:08:29.920 --> 1:08:30.360 Not yet? 1:08:30.479 --> 1:08:33.559 It's too Really, I think it's true, really getting everyone 1:08:33.680 --> 1:08:37.040 is feeling trigger happy. But the sweet spot for booking 1:08:37.080 --> 1:08:40.639 your trips home for the holidays is actually from about 1:08:40.760 --> 1:08:45.240 September fourteenth to October fourteenth, So that four week window 1:08:45.280 --> 1:08:48.360 at the end of September and early October, fares for 1:08:48.960 --> 1:08:51.680 trips home for the holidays they start incredibly high in 1:08:51.760 --> 1:08:55.080 the summer. You'd be paying about twenty percent more than 1:08:55.160 --> 1:08:57.800 previous years if you booked right now. But if you wait, 1:08:57.920 --> 1:09:00.280 they're going to come down during that sweet spot. That's 1:09:00.320 --> 1:09:01.200 really when you want to book. 1:09:01.360 --> 1:09:04.160 That was Hailey Berg, lead economist at the travel app Hopper. 1:09:04.360 --> 1:09:06.400 That wraps up the weekend edition of Bloomberg Business Week 1:09:06.400 --> 1:09:08.600 from Bloomberg Radio. Thank you so much for joining us. 1:09:08.880 --> 1:09:10.920 Be sure to tune into Bloomberg Business Week Monday through 1:09:10.960 --> 1:09:13.360 Friday starting at three pm Wall Street Time on Bloomberg 1:09:13.439 --> 1:09:15.799 Radio and on Sirius XM channel one nineteen. 1:09:15.880 --> 1:09:18.040 You can also watch your daily broadcast on YouTube. Just 1:09:18.080 --> 1:09:21.599 search Bloomberg Global News and we're summlecast on Bloomberg Originals 1:09:21.680 --> 1:09:25.280 available at Bloomberg dot com, Slash Originals, and streaming platforms 1:09:25.360 --> 1:09:29.320 including Roku, Amazon, fireTV, Semsung tv Plus and more. 1:09:29.600 --> 1:09:32.639 Find our Bloomberg BusinessWeek Podcast at Bloomberg dot com, Apple, 1:09:32.720 --> 1:09:35.320 or wherever you get your podcasts. The latest edition of 1:09:35.360 --> 1:09:38.280 the magazine is available on newsstands now, at Bloomberg dot 1:09:38.320 --> 1:09:41.479 com and always on the Bloomberg Terminal. I'm Tim Stinebeck 1:09:41.520 --> 1:09:43.960 and I'm Carol Masser. Have a good and safe weekend, everybody. 1:09:44.040 --> 1:09:46.960 Stay with us. Today's top stories and global business headlines 1:09:47.040 --> 1:09:48.200 are coming up right now. 1:09:48.880 --> 1:09:53.480 This is the Bloomberg Business Week Podcast, available on Apple, Spotify, 1:09:53.680 --> 1:09:57.360 and anywhere else you get your podcast. Listen live weekday 1:09:57.400 --> 1:09:59.040 afternoons from three to six. 1:09:59.000 --> 1:10:03.040 Eastern Boomberg dot com, the iHeartRadio app, tune In, and 1:10:03.120 --> 1:10:04.360 the Bloomberg Business App. 1:10:04.439 --> 1:10:07.360 You can also watch us live every weekday on YouTube 1:10:07.640 --> 1:10:09.639 and always on the Bloomberg Terminal