WEBVTT - Investor Mellody Hobson: 'If It Matters, It's Counted 0:00:00.080 --> 0:00:12.800 Ye. Welcome to Strictly Business Varieties weekly podcast featuring conversations 0:00:12.800 --> 0:00:15.960 with industry leaders about the business of media and entertainment. 0:00:16.360 --> 0:00:20.120 I'm Cynthia Littleton, co editor in chief of Variety Today. 0:00:20.160 --> 0:00:23.319 My guest is Melody Hobson, President and co CEO of 0:00:23.400 --> 0:00:27.520 Aerial Investments. The respected media investor has a thirty thousand 0:00:27.560 --> 0:00:30.360 foot view of the global economy through her purcha as 0:00:30.360 --> 0:00:33.320 a board member for such corporate giants as Starbucks and 0:00:33.440 --> 0:00:36.960 JP Morgan Chase. She's also a prominent speaker on issues 0:00:37.000 --> 0:00:40.599 of diversity and equity in corporate America. She shares her 0:00:40.640 --> 0:00:43.680 thoughts here on what the industry's biggest players need to 0:00:43.720 --> 0:00:47.600 do to make progress in this moment that she sees 0:00:47.680 --> 0:00:51.159 as something like quote civil rights three point oh in 0:00:51.200 --> 0:00:57.160 America end quote. Melody has a lot to say. Thank 0:00:57.200 --> 0:01:00.680 you so much for joining us. Thanks for having Melody. 0:01:00.800 --> 0:01:04.399 You have spoken often and very eloquently about the the 0:01:04.560 --> 0:01:10.440 obligation of directors of public companies to serve in those 0:01:10.480 --> 0:01:15.959 boardrooms as not rubber stamps, but advocates and almost investigators 0:01:16.000 --> 0:01:20.760 for shareholders. They directors really do have a fiduciary duty 0:01:20.800 --> 0:01:23.640 on paper, and they need to uphold it to represent 0:01:23.720 --> 0:01:29.520 the interests of shareholders. You serve on several large, very 0:01:29.600 --> 0:01:33.880 large public company boards as stay Lauder, Starbucks. You were 0:01:34.000 --> 0:01:38.560 chair of DreamWorks Animation in its final years. I love 0:01:38.640 --> 0:01:42.280 your perspective on how being a director at an entertainment 0:01:42.319 --> 0:01:46.520 company is different from working in other sectors. What is 0:01:46.560 --> 0:01:50.600 it that is that is different or more challenging or 0:01:50.640 --> 0:01:55.240 more invigorating about the content business? Wow, that is a 0:01:55.280 --> 0:01:58.280 great question. I don't think that being on the board 0:01:58.280 --> 0:02:02.120 of an entertainment company is fundamentally different than being on 0:02:02.120 --> 0:02:05.400 the board of a coffee company like Starbucks where I am, 0:02:05.520 --> 0:02:08.840 or a bank like JP Morgan. I think the issues 0:02:09.520 --> 0:02:14.360 come uh in different versions. But I think at the 0:02:14.440 --> 0:02:17.840 end of the day, the the the issues that boards 0:02:18.440 --> 0:02:22.720 confront are really universal issues. So I don't see them 0:02:22.720 --> 0:02:26.560 as being fundamentally different from your time and DreamWorks and 0:02:26.600 --> 0:02:29.239 your exposure to other, you know, other wide types of 0:02:29.680 --> 0:02:33.440 media companies. Is there anything Is there anything that stands 0:02:33.440 --> 0:02:37.239 out in your mind that is challenging at the director 0:02:37.360 --> 0:02:41.760 level about the content business, which, as everybody knows, it's 0:02:41.760 --> 0:02:44.760 not a widget business. It's not making a certain type 0:02:44.840 --> 0:02:49.519 of of lipstick or you know, there's so much subjectivity 0:02:49.560 --> 0:02:52.560 that goes into the product. You know. The thing is 0:02:52.880 --> 0:02:57.160 everything is being disrupted everything. You know, when you're in 0:02:57.200 --> 0:03:00.080 a certain industry, you always think it's just you. I 0:03:00.080 --> 0:03:02.919 mean the asset management business that has been disrupted by 0:03:03.000 --> 0:03:06.280 passive management. When I was on the board of Esta Lauder, 0:03:06.680 --> 0:03:10.480 the whole role of department stores was changing and they 0:03:10.480 --> 0:03:14.360 were responding to that. When you look at media, you 0:03:14.400 --> 0:03:17.919 have the disruption that's been very real, the the combinations 0:03:17.919 --> 0:03:21.440 that have gone on. Obviously the destructions by technology because 0:03:21.440 --> 0:03:24.000 they're streaming and the like, and so I just don't 0:03:24.000 --> 0:03:27.200 think if you look at it any industry right now, 0:03:27.280 --> 0:03:30.560 the disruption is rampant, and so I don't think that 0:03:30.639 --> 0:03:33.440 it's a question of one being harder than the other. 0:03:34.000 --> 0:03:35.720 I think it's a question of how do you deal 0:03:35.760 --> 0:03:38.880 with that disruption. I love the line from Warren Buffett 0:03:38.920 --> 0:03:42.440 was as champions adapt, And I think the great thing 0:03:42.480 --> 0:03:44.560 about the rooms that I've been in, I've been in 0:03:44.680 --> 0:03:48.160 rooms with champions, and so they figured out ways to 0:03:48.200 --> 0:03:51.440 adapt to the disruption that has come at them and 0:03:51.520 --> 0:03:54.600 ultimately how to survive or thrive. Can you give an 0:03:54.640 --> 0:03:58.080 example of, like how you've seen a CEO or or 0:03:58.120 --> 0:04:01.760 a leadership team or spawn to like, you know, an 0:04:01.760 --> 0:04:05.600 existential level of disruption, like how do you how do 0:04:05.680 --> 0:04:08.280 you lead through it? If you don't know you know 0:04:08.280 --> 0:04:11.320 where the path is going? Well, that is that's the 0:04:11.360 --> 0:04:13.800 whole game. I mean, that's why CEOs get paid the 0:04:13.800 --> 0:04:16.080 big box. You know, you've got to be able to 0:04:16.120 --> 0:04:19.560 see around corners, you know, as Wayne Gretzky said that 0:04:19.560 --> 0:04:22.479 that's saying that has been probably overused. Go where the 0:04:22.480 --> 0:04:25.719 puck is going to be. I mean, that's the whole point. Um. 0:04:25.760 --> 0:04:28.240 If it were easy, everyone would do it. And so 0:04:28.320 --> 0:04:31.120 I think that we've seen leadership in lots of ways. 0:04:31.240 --> 0:04:34.240 Lots of CEOs have have really pivoted in ways that 0:04:34.279 --> 0:04:37.040 are quite remarkable. I mean, let's look at Netflix. It 0:04:37.200 --> 0:04:40.040 used to be a DVD in the mail. When they 0:04:40.080 --> 0:04:43.839 made that decision to switch to to online and the like, 0:04:44.000 --> 0:04:46.800 I mean, it just was a game changer, obviously in 0:04:46.839 --> 0:04:48.800 a lot of ways. I'm sorry, a subscription model was 0:04:48.839 --> 0:04:51.400 a game changer for them, but it was a bold 0:04:51.640 --> 0:04:55.119 and I'm sure at the time very scary move. And 0:04:55.480 --> 0:04:57.880 obviously we're seeing some of these things right now with Disney. 0:04:57.920 --> 0:05:02.840 I mean, existential factor, COVID there are no movie theaters, 0:05:02.880 --> 0:05:05.880 and therefore the streaming part of their business has become 0:05:06.440 --> 0:05:09.440 very very important. And you know, I thought it's fascinating 0:05:09.480 --> 0:05:12.480 they've blown out their projections in a year. They're in 0:05:12.560 --> 0:05:16.680 year four of their own projections, which was again everything 0:05:16.720 --> 0:05:23.200 being disrupted, everything being accelerated, accelerated by COVID, which may inevitably, 0:05:23.720 --> 0:05:27.240 I know, there's so much pain and anguish and death 0:05:27.320 --> 0:05:30.320 and destruction has come from this pandemic, but that may 0:05:30.480 --> 0:05:35.000 ultimately be a silver lining for them. The there's no 0:05:35.080 --> 0:05:39.520 question that the the acceleration of trends that we're already 0:05:39.560 --> 0:05:42.840 ongoing by the pandemic is going to be from an 0:05:42.880 --> 0:05:46.040 economic you know, it'll take ten years, but we will 0:05:46.080 --> 0:05:48.320 figure you know, at some point we'll look back and 0:05:48.360 --> 0:05:52.400 think and see those mild markers of this moment. For sure, 0:05:53.200 --> 0:05:55.440 it might be less than ten years. That's the thing, 0:05:55.839 --> 0:05:59.200 because things are happening so quickly. Um, I don't think 0:05:59.200 --> 0:06:01.600 the old rules of why. In the last couple of years, 0:06:01.600 --> 0:06:05.440 there's been heightened focus on the status of women in 0:06:05.600 --> 0:06:09.599 boardrooms and c suites and in companies in in Hollywood 0:06:09.640 --> 0:06:12.200 as well as other you know, other sectors of the economy. 0:06:12.640 --> 0:06:16.400 Can you talk about your experience in in looking at 0:06:16.600 --> 0:06:21.080 governance and how they handle diversity and the promotion of women. 0:06:21.160 --> 0:06:24.400 Are there examples of companies that you can think of 0:06:24.440 --> 0:06:28.640 that have you know, programs or pipelines that are really working. 0:06:29.080 --> 0:06:32.960 We've heard so much about you know, pipelines of talent 0:06:33.120 --> 0:06:36.599 to advancement being such problems. Can can you think of 0:06:36.640 --> 0:06:39.480 anybody in your experience that's really doing it well? Well, 0:06:39.480 --> 0:06:41.799 It's interesting because the boards that I've been on, they've 0:06:41.839 --> 0:06:44.520 always had a lot of women leaders. I had to 0:06:44.560 --> 0:06:47.080 say we had a lot of women leaders at dream 0:06:47.080 --> 0:06:50.360 Works and daily many of the people inside of production 0:06:50.400 --> 0:06:54.320 et cetera, um were women who were exemplary. I mean 0:06:54.360 --> 0:06:57.359 I could I could call out so many. Um. The 0:06:57.440 --> 0:07:00.960 same is true of Starbucks if you look at leaders there, 0:07:00.960 --> 0:07:03.479 I mean we have a general counsel that's a woman, 0:07:03.960 --> 0:07:08.280 head of human resources as a woman Ross Brewer, or 0:07:08.320 --> 0:07:10.440 a CEO of the company of the woman, the person 0:07:10.480 --> 0:07:13.200 who runs America for all the stories for the woman 0:07:13.240 --> 0:07:15.760 I mean the prison and went to China is a woman. 0:07:15.880 --> 0:07:18.320 I could just go on and on. So the leadership 0:07:18.520 --> 0:07:21.320 of women there and had a technology. I mean I 0:07:21.320 --> 0:07:24.360 could keep going and look at if you morgan the 0:07:24.400 --> 0:07:26.800 same sort of thing. If you look at that operating committee, 0:07:27.080 --> 0:07:30.000 it is has a very strong population of women at 0:07:30.000 --> 0:07:33.560 the top of that organization, and so um at least 0:07:33.560 --> 0:07:35.520 in the rooms that I've been in, that was certainly 0:07:35.560 --> 0:07:39.440 to invest the Lotter, which you know obviously as a 0:07:39.520 --> 0:07:43.600 company where ninety of their products are bought by women, 0:07:44.160 --> 0:07:46.920 women are really taking a very senior and leading role 0:07:46.960 --> 0:07:49.400 in that organization as well. So I had to say, 0:07:49.440 --> 0:07:52.600 I've been very fortunate that I haven't been in rooms 0:07:52.640 --> 0:07:56.440 where it was a problem that had to be addressed. More. 0:07:56.800 --> 0:08:00.360 I've been in rooms where there was real attention hate 0:08:00.360 --> 0:08:06.800 to gender leadership and where I saw real outcomes that 0:08:06.840 --> 0:08:09.600 were very very positive. I think it's something you always 0:08:09.600 --> 0:08:12.440 have to be intentional about, so you don't just sort 0:08:12.440 --> 0:08:14.680 of hope it happens. I think when it comes to 0:08:14.840 --> 0:08:18.600 gender and race, you have to make sure that you're watching, 0:08:18.920 --> 0:08:21.880 because you can find yourself falling backwards if you're not 0:08:22.000 --> 0:08:24.960 very careful. But fortunately the rooms that I've been in 0:08:25.520 --> 0:08:27.920 that if you live in front and centers on gender, 0:08:28.200 --> 0:08:30.280 and that's where I think right now we need to 0:08:30.280 --> 0:08:32.959 get to that same level as it relates to race. 0:08:33.240 --> 0:08:36.840 Whether it's the women or race. Is it. It sounds 0:08:36.880 --> 0:08:39.840 like it's like deeply grooted in the culture of a 0:08:39.920 --> 0:08:43.640 company that there is inclusion. Is that is that kind 0:08:43.640 --> 0:08:47.600 of what what you found? I think leadership matters, and 0:08:47.640 --> 0:08:49.840 you want to make sure you have people who believe 0:08:49.880 --> 0:08:53.360 in these values because if they don't, you're not the 0:08:53.440 --> 0:08:57.600 company is not going to represent or be representative of 0:08:57.679 --> 0:09:00.840 the society that we live in. I think words also 0:09:01.040 --> 0:09:05.800 have to be very intentional and they're questioning on these issues, 0:09:06.120 --> 0:09:09.319 and again make sure they hold organizations accountable. I always 0:09:09.360 --> 0:09:13.440 talk about if it matters, it counts. Start counting, just count. 0:09:13.880 --> 0:09:16.800 I love that saying math has no opinion. Look at 0:09:16.840 --> 0:09:19.880 the organization from top to bottom. Start at the board, 0:09:20.240 --> 0:09:24.720 look by ethnicity and gender. No multicultural umbrella where you 0:09:24.760 --> 0:09:27.600 put everyone together and you know, roll it all up 0:09:27.640 --> 0:09:31.320 so the numbers look great. By counting by ethnicity and gender, 0:09:31.600 --> 0:09:34.800 you see where the under representation is. You do the suite, 0:09:34.880 --> 0:09:37.760 C suite, you do the next level of executives all 0:09:37.800 --> 0:09:40.520 the way down. No patting yourself from the back giving 0:09:40.600 --> 0:09:45.640 some big ethnicity number when your ethnicity comes from the 0:09:45.679 --> 0:09:50.000 assistant level. That doesn't work. So if you count by level, 0:09:50.559 --> 0:09:53.360 starting at the board, making sure that the board is 0:09:53.360 --> 0:09:57.079 holding the organization accountable. I believe also you get what 0:09:57.160 --> 0:10:01.840 you incent and I think incentives type to diversity. Actually 0:10:02.360 --> 0:10:06.640 that loves the need all um because people are motivated 0:10:06.679 --> 0:10:09.760 by their own self interests and pay being one of them. 0:10:09.840 --> 0:10:12.840 And for most things in corporate America that matter, we 0:10:12.920 --> 0:10:17.200 have incentives tied to them, box office receipts, it could 0:10:17.240 --> 0:10:20.760 be eyeballs, it could be a product, lad could be earning, 0:10:21.240 --> 0:10:24.640 it could be profitability didn't go down all sorts of 0:10:24.640 --> 0:10:29.640 of um issues and seeing metrics and incentives tied to 0:10:29.720 --> 0:10:33.199 them in corporate America. So why should something is crucial 0:10:33.520 --> 0:10:36.480 as diversity, which we all say is a missuing critical, 0:10:36.960 --> 0:10:41.760 also have incentives tied or tied to it. You're like, 0:10:42.080 --> 0:10:48.680 you know, in writing measurable actionable goals of hiring, of content, 0:10:49.000 --> 0:10:51.520 of you know, whatever it be. Is your sense as 0:10:51.559 --> 0:10:53.880 an investor and as a board member like that that 0:10:54.000 --> 0:10:57.000 is becoming more the norm, or is it? We think 0:10:57.040 --> 0:11:01.480 that it's still something that the companies yet to fully embrace. 0:11:02.160 --> 0:11:04.120 I think it's early days, but I think the train 0:11:04.200 --> 0:11:06.600 is leaving the station on this one. So I think 0:11:06.640 --> 0:11:09.160 now the heat is on this issue is limited at 0:11:09.160 --> 0:11:12.360 the feet of corporate America, and there's nowhere to hide, 0:11:12.480 --> 0:11:15.319 there's nowhere to go. Um. I've really talked about I 0:11:15.320 --> 0:11:18.040 almost see this as as civil rights three point oh 0:11:18.040 --> 0:11:21.360 in America. You know, maybe the the Civil War was 0:11:21.400 --> 0:11:24.840 one version, the nineteen sixties one another, and this is another. 0:11:25.240 --> 0:11:29.439 That nine sixties version was around government, government policies, laws 0:11:29.880 --> 0:11:33.079 and the life. And this is now about corporate America 0:11:33.240 --> 0:11:35.400 and what is corporate America going to do? It is 0:11:35.440 --> 0:11:37.120 where that at the feet of corporate America in a 0:11:37.200 --> 0:11:41.200 very different way than ever before, and there's no avoiding 0:11:41.240 --> 0:11:44.720 it because of the viral nature of our society. Not 0:11:44.840 --> 0:11:48.160 only are our employees going to hold us accountable, our 0:11:48.280 --> 0:11:52.000 vendors are asking questions about it, our customers are asking 0:11:52.080 --> 0:11:56.640 questions about these issues. And the larger society is holding 0:11:56.720 --> 0:11:59.199 us accountable. And so I do think it's a new 0:11:59.280 --> 0:12:03.240 day and therefore on these issues, they're the ball is 0:12:03.400 --> 0:12:07.240 just getting rolling. But I think words to recognize, they 0:12:07.280 --> 0:12:12.920 have to be able to demonstrate, uh cause nfac just 0:12:12.960 --> 0:12:14.880 in general, as an investor right now, how do you 0:12:15.080 --> 0:12:18.160 size up the you know, the kind of the traditional 0:12:18.240 --> 0:12:23.320 entertainment industry it is going through seismic shifts. Is it's 0:12:23.400 --> 0:12:26.559 so disrupted right now that you would as an investor 0:12:26.640 --> 0:12:28.320 kind of shy away from it, or do you see 0:12:28.320 --> 0:12:31.680 a lot of opportunity and all of that dismantling. We 0:12:31.760 --> 0:12:34.160 see a lot of opportunity. Yeah, we don't try await 0:12:34.200 --> 0:12:37.559 from it at all. Remember we are we're countrarian investors, 0:12:37.600 --> 0:12:41.520 and we're looking to go where others, for whatever reason, 0:12:41.559 --> 0:12:44.320 we think they're missing something, they don't understand something, don't 0:12:44.400 --> 0:12:47.720 they don't see what we see. UM. Earlier this year, 0:12:48.040 --> 0:12:52.319 we've we've been in and out of viacom CBS now 0:12:52.440 --> 0:12:55.520 via com CBS. We bought our first years of those 0:12:55.520 --> 0:12:58.760 two companies when they were separate during the financial crisis, 0:12:59.280 --> 0:13:03.199 and that that being a phenomenally good investment for us, 0:13:03.280 --> 0:13:06.920 both of them. And then when the when the trip 0:13:07.000 --> 0:13:10.120 the murder happened between the companies or the acquisition, I 0:13:10.160 --> 0:13:14.320 should say, um, the stocks the stock just got humbled, 0:13:14.559 --> 0:13:18.079 as many people know UM and went to two times earnings, 0:13:18.520 --> 0:13:20.280 which is just like I mean, I say that with 0:13:20.320 --> 0:13:25.160 an exclamation point because that's just really cheap. And we 0:13:25.160 --> 0:13:29.400 we became aggressive buyers, especially in March, and that's been 0:13:29.480 --> 0:13:32.800 a really good uh return for us in a really 0:13:32.800 --> 0:13:35.400 good story in terms of what is in terms of 0:13:35.400 --> 0:13:37.680 what has happened there and that with that company. But 0:13:37.720 --> 0:13:40.240 there are other places that we've been in the media 0:13:40.280 --> 0:13:43.680 space over the years and and you know, it's it's 0:13:43.760 --> 0:13:46.960 it's a space we know very very well compared to 0:13:47.000 --> 0:13:52.280 other sectors. Is there in terms of evaluating success, evaluating 0:13:52.400 --> 0:13:56.240 leadership and goals? Is there anything challenging about Hollywood because 0:13:56.240 --> 0:14:02.080 the product is so different other types of of you know, manufacturing, 0:14:02.160 --> 0:14:05.880 our services, service business. I guess we don't see it 0:14:05.920 --> 0:14:08.800 that way. We see it as a very specific kind 0:14:08.840 --> 0:14:12.960 of product. And the challenge obviously of late has been 0:14:13.520 --> 0:14:18.360 the conversation around distribution. That challenge has been the conversation 0:14:18.440 --> 0:14:24.320 around competition, and that is also created opportunity. Uh. You know, 0:14:24.360 --> 0:14:27.360 obviously it's been a consolidating industry. We've seen the industries 0:14:27.360 --> 0:14:30.360 consolidate and then we've seen them break apart. This is 0:14:30.400 --> 0:14:33.960 not new. This is is a dissert in many ways 0:14:34.000 --> 0:14:37.160 in terms of what has happened time and time again 0:14:37.440 --> 0:14:40.600 in business. Um. But what we're looking at is you're 0:14:40.640 --> 0:14:43.920 looking for companies that are brands or franchises. We're looking 0:14:43.960 --> 0:14:46.040 for businesses that we think over the long term, they 0:14:46.080 --> 0:14:49.000 have a niche or remote around them that make them 0:14:49.560 --> 0:14:53.520 better than their competition. And as I suggested, we recognize 0:14:53.560 --> 0:14:56.720 in an in a world where everything has been disrupted, 0:14:57.280 --> 0:15:00.800 that does create some fallout and some wreckage, but also 0:15:00.880 --> 0:15:04.400 creates a tremendous amount of opportunity. You still have the 0:15:04.480 --> 0:15:08.360 domination of certain organizations that have only gotten stronger and better. 0:15:08.360 --> 0:15:11.720 In my view, Um, we don't at a real own Disney, 0:15:11.760 --> 0:15:15.000 but I watched Disney very closely, and Disney is an 0:15:15.000 --> 0:15:18.760 example of a company that's been very, very smart about 0:15:18.760 --> 0:15:23.080 what they've done as this industry is consolidated. You know, Pixar, 0:15:23.360 --> 0:15:28.040 starting with Pixar, Lucasville, Marvel, Um, and then what they've 0:15:28.080 --> 0:15:31.480 done with streaming. I mean there's Fox, I mean there's 0:15:31.640 --> 0:15:35.440 there's a bold Bibber has had some very bold leadership, 0:15:35.720 --> 0:15:41.200 bold ideas, and this next frontier around streaming. I think 0:15:41.360 --> 0:15:44.760 they've been bold about that too with their recent announcements. So, 0:15:45.640 --> 0:15:48.600 I mean, we don't see it as being harder than 0:15:48.640 --> 0:15:52.040 other things. It's just different. You know. I can tell 0:15:52.040 --> 0:15:54.480 you banks are hard, and I can go through all 0:15:54.560 --> 0:15:58.040 sorts of areas that are really really hard. Um, they're 0:15:58.120 --> 0:16:01.840 hard in their own way. Um, but not not not 0:16:01.920 --> 0:16:05.520 in a way that that makes it more challenging than 0:16:05.600 --> 0:16:10.520 analyzing other areas of American business or businesses around the 0:16:10.520 --> 0:16:13.320 globe for that matter. How does when you bring up 0:16:13.360 --> 0:16:17.360 Bob Iger, Um, we're obviously closely watching, you know, the 0:16:17.400 --> 0:16:21.760 transition at Disney. He is enormous CEO shoes to follow 0:16:22.360 --> 0:16:24.440 as a director when you go through that kind of 0:16:24.440 --> 0:16:27.200 a shift, especially from somebody having coming off a long 0:16:27.280 --> 0:16:30.720 run of a lot of success. Is there like a 0:16:30.720 --> 0:16:33.840 boot camp for new CEO s? Is there is there 0:16:33.960 --> 0:16:37.520 something that that, particularly at the governance level, that the 0:16:37.600 --> 0:16:41.320 board can do to you know, support a new CEO. 0:16:41.440 --> 0:16:45.000 I feel, you know, Bob Jpeg again, he's following Babe 0:16:45.040 --> 0:16:48.640 Ruth and lou garreg and Tom Brady. I'll rolled into one. Well, listen, 0:16:48.640 --> 0:16:50.920 I think that you know, he's worked along side of 0:16:51.280 --> 0:16:54.280 Bob Iger from what I understand, for quite a while. Um, 0:16:54.320 --> 0:16:56.040 I don't think there's a boot camp. I don't know 0:16:56.080 --> 0:16:58.600 how they run their board or their company. I could 0:16:58.640 --> 0:17:01.440 not in any way suggest to speak to how they're 0:17:01.480 --> 0:17:03.960 managing that transition. So far, so good. It looks like 0:17:04.040 --> 0:17:07.320 from the outside, and obviously by Biker is also still there. 0:17:07.840 --> 0:17:10.919 I think that um what I've been in companies that 0:17:10.960 --> 0:17:15.520 have had transitions. You know, that's what boards are for succession, 0:17:15.880 --> 0:17:18.159 That's what it all comes down to. That's one of 0:17:18.160 --> 0:17:20.919 the biggest jobs you have as a board is to 0:17:21.080 --> 0:17:25.119 understand who's going to run the company, who's next in line. 0:17:25.560 --> 0:17:30.120 Really having a good sense of leadership, that's essential at 0:17:30.119 --> 0:17:32.760 the end of the day. And so I think boards 0:17:32.840 --> 0:17:35.920 in general, no matter if you have a great leader, 0:17:35.960 --> 0:17:39.960 life lab viser, or a CEO that has struggled, I 0:17:40.000 --> 0:17:43.280 think they've been an equal amount of time on leadership 0:17:43.880 --> 0:17:46.680 and at the end of the day, that's what ultimately 0:17:46.840 --> 0:17:50.479 makes for success or failure with most businesses. Let me 0:17:50.880 --> 0:17:54.320 just in general, your sense of the macro economy are 0:17:54.440 --> 0:17:57.080 we Is it too soon to say that we're inching 0:17:57.080 --> 0:17:59.800 our way out of the worst of it? No? No, No, 0:18:00.080 --> 0:18:02.240 think the market is already. You know, everyone keeps saying, 0:18:02.600 --> 0:18:05.000 you know, how could this market be so strong? Well, 0:18:05.080 --> 0:18:07.280 part of it is the fangs, which we know plus 0:18:07.320 --> 0:18:11.520 Microsoft that it really dominated the large caps docks and 0:18:11.720 --> 0:18:13.840 a big part of the index at this point. But 0:18:13.920 --> 0:18:16.040 I think the other part of it is that the 0:18:16.119 --> 0:18:20.200 market anticipates the future, and the market anticipates the future 0:18:20.560 --> 0:18:24.440 with a vaccine, and that future is it feels like 0:18:24.560 --> 0:18:27.760 it's forever. But in the world of invest thing it's 0:18:27.800 --> 0:18:30.600 around the corner when you're thinking about next spring or 0:18:30.680 --> 0:18:34.080 next summer, and I think the most important thing is 0:18:34.119 --> 0:18:36.640 just to get to the other side. And it's interesting 0:18:36.680 --> 0:18:39.040 because I heard Bill Miller, who's a very very famous 0:18:39.119 --> 0:18:42.399 portfolio manager, say, you know, none of us gets on 0:18:42.480 --> 0:18:46.080 an airplane thinking about smallpox because we have a vaccination 0:18:46.160 --> 0:18:48.439 for it. And it will be like that, like that 0:18:48.480 --> 0:18:51.879 with COVID nineteen. At some point will be vaccinated and 0:18:51.920 --> 0:18:55.040 the world will move on and hopefully we'll be more 0:18:55.119 --> 0:18:59.480 prepared for the inevitable next time. But the bottom line is, 0:18:59.520 --> 0:19:02.400 I think it uh. There will be ups and downs. 0:19:02.480 --> 0:19:06.320 The election creates uncertainty for sure, and so there I 0:19:06.359 --> 0:19:09.560 can't say that we won't have volatility. We will likely 0:19:09.720 --> 0:19:14.480 have more volatility, not less. But I think big picture, 0:19:15.040 --> 0:19:18.120 big big picture, three to five years from now, when 0:19:18.119 --> 0:19:20.960 we're looking back on this, it'll be a distant memory. 0:19:21.320 --> 0:19:24.359 I've read a lot of concern about, you know, a 0:19:24.440 --> 0:19:27.080 new level of a new normal for the kind of 0:19:27.160 --> 0:19:34.439 chronically unemployed. Is the unemployment piece of this slowdown? Is 0:19:34.480 --> 0:19:37.800 that concerning to you at all? That? The rest concerning 0:19:37.880 --> 0:19:41.040 to thing to me right now is the stimulus chats. 0:19:41.680 --> 0:19:43.840 I mean that is where I feel like we could 0:19:43.920 --> 0:19:48.440 really really hurt ourselves. I think Congress did a very 0:19:48.480 --> 0:19:51.520 good job this summer of putting hands and money in 0:19:51.560 --> 0:19:55.879 the hands of people who needed it desperately. And I 0:19:55.920 --> 0:19:58.600 think now we're at the point where people are running 0:19:58.600 --> 0:20:03.800 through their savings and things are getting very, very very tight. 0:20:04.320 --> 0:20:07.960 That has me very worried about an economic recovery if 0:20:08.000 --> 0:20:10.840 we go too deep into the whole in terms of 0:20:11.240 --> 0:20:15.359 individual death and the life. And so I think that 0:20:15.840 --> 0:20:19.920 more than thinking about a big job story the most 0:20:20.040 --> 0:20:25.760 the more immediate issue to me is, uh, this economic stimulus. Now. 0:20:26.040 --> 0:20:28.200 The sad thing is it looks like we're not going 0:20:28.240 --> 0:20:31.440 to have it before the election. And this is this 0:20:31.520 --> 0:20:35.000 is this is just so sad because this is not 0:20:35.080 --> 0:20:39.280 about weeks. It's like everyday matters at this point, especially 0:20:39.320 --> 0:20:42.840 for those who have food insecurity and housing insecurity. It's 0:20:42.880 --> 0:20:46.399 just to me unconscionable what is happening right now. And 0:20:46.480 --> 0:20:50.400 it does have a longer term effect, but I think 0:20:50.480 --> 0:20:56.480 big picture. Once you get to a post vaccine economy, 0:20:56.560 --> 0:20:59.040 I think you will start to see, like we start 0:20:59.119 --> 0:21:02.400 with saw with someone opening in the summer, jobs come back. 0:21:03.040 --> 0:21:06.000 But I'm concerned about the poverty that will be created 0:21:06.040 --> 0:21:10.120 along the way, especially when you think about school children. 0:21:10.520 --> 0:21:14.000 It's just heartbreaking that to think that there's some that 0:21:14.119 --> 0:21:16.800 there's a new level of halves and have nots those 0:21:16.840 --> 0:21:19.040 that you know, we've seen the stories of people having 0:21:19.040 --> 0:21:22.640 to go outside of fast food places to get to 0:21:22.680 --> 0:21:27.680 get WiFi. It's that the the spotlight on the inequities 0:21:28.080 --> 0:21:31.160 is so is so great right now and and so 0:21:31.720 --> 0:21:34.280 and so magnified at a time when I think even 0:21:34.720 --> 0:21:39.480 people are more the the inequities and the kind of 0:21:39.560 --> 0:21:44.560 root causes have been put in such sharp relief. Um. 0:21:44.600 --> 0:21:50.240 You know again that you've spoken eloquently about the question 0:21:50.240 --> 0:21:54.000 of being color blind or color brave, the importance of 0:21:54.640 --> 0:21:59.960 addressing head on systemic issues, you know, long term problems. 0:21:59.840 --> 0:22:04.080 And the wealth gap is just the wealth gap between 0:22:04.119 --> 0:22:08.240 black families and white fat it's just unconscionable. And I 0:22:08.240 --> 0:22:10.760 know you've been been speaking out on this and as 0:22:10.800 --> 0:22:13.760 an investor, have done much. You touched on a little 0:22:13.760 --> 0:22:16.800 bit are there signs about this this period that we're 0:22:16.840 --> 0:22:20.399 living in that give you hope that there is a 0:22:20.520 --> 0:22:24.120 way to close the you know, make progress on closing 0:22:24.160 --> 0:22:28.000 the gaps that are so big in this country. Let's 0:22:28.000 --> 0:22:31.960 start off with we to help crisis, the pandemic that 0:22:32.119 --> 0:22:35.800 turned into a financial crisis, which we obviously know and 0:22:35.920 --> 0:22:40.000 of seeing firsthand, which has now also turned into a 0:22:40.040 --> 0:22:43.359 great deal of social unrest. We've been hit. It's a 0:22:43.400 --> 0:22:47.240 trifacta of bad there's no question about it. But the 0:22:47.280 --> 0:22:51.439 social undust is economic and people really do need to 0:22:51.520 --> 0:22:56.200 understand that economic inequality is what leads people to this tree. 0:22:56.760 --> 0:23:00.840 Economic inequality is what leads to anger and what causes 0:23:00.880 --> 0:23:04.000 people to loot and things like that. I am never 0:23:04.240 --> 0:23:08.359 a believer in violence ever. Ever. Ever, however, if your 0:23:08.440 --> 0:23:10.840 children were hungry, what would you do? That's what I 0:23:10.880 --> 0:23:13.600 ask people all the time, to put some of this 0:23:14.119 --> 0:23:19.919 angst and desperation into perspective. The gaps are growing greater 0:23:20.119 --> 0:23:26.000 every single day. The statistics suggests that of adults Black 0:23:26.040 --> 0:23:30.480 adults in this country right now are unemployed five oh. 0:23:30.680 --> 0:23:34.400 It is a stunning number, and we have to recognize 0:23:34.520 --> 0:23:37.680 unless we are very very again I use the word 0:23:37.680 --> 0:23:42.639 intentional and cognizant of this fact, no one wins. We 0:23:42.680 --> 0:23:46.399 will all be living in cities with retail stores more 0:23:46.400 --> 0:23:50.639 boarded up and and national guards having to be called 0:23:50.680 --> 0:23:53.159 in and things like that, and no one wants that. 0:23:53.880 --> 0:23:57.200 So what really? I do believe that we must impress 0:23:57.359 --> 0:24:02.880 upon government, in corporate leadership, etcetera, that this needs to 0:24:03.000 --> 0:24:07.480 narrow the wealth gap by making sure they're true diversity 0:24:07.480 --> 0:24:11.920 and inclusion inside of corporate America where jobs are created. 0:24:12.840 --> 0:24:17.359