Speaker 1: This is Bloomberg Business Wait inside from the reporters and
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Speaker 1: global business finance and tech news. The Bloomberg Business Week
Speaker 1: Podcast with Carol Messer and Tim Stenebeck from Bloomberg Radio
Speaker 1: Boom Bank.
Speaker 2: A lot of wide oppoot spaces that are filled with
Speaker 2: a lot of people. As I look around us, we're
Speaker 2: so delighted to be back here at the US Open
Speaker 2: and delighted to have back with us. Kirsten Corio, she
Speaker 2: is chief Commercial Officer of USTA, and we were talking.
Speaker 2: You've actually been with the organization now for.
Speaker 3: For seven years. This is actually my eighth US Open.
Speaker 4: And yes we do count the twenty twenty pandemic US
Speaker 4: Open because it did occur.
Speaker 2: We did work, but we just weren't here well. And
Speaker 2: I will say last year felt like all right, everybody
Speaker 2: was back in a big way. You guys are having
Speaker 2: some record numbers to get this year.
Speaker 4: We are, We thought after twenty twenty two, the most
Speaker 4: spectacular US Open ever, Serena evolving away from tennis and
Speaker 4: the mania around Gosh, we got to see her one
Speaker 4: last time. How do we top that in twenty twenty three,
Speaker 4: and then here we are. You mentioned it, Tim, no
Speaker 4: Big Three, no Serena. You know, we've wondered us that
Speaker 4: are in the business, those of us that are fans,
Speaker 4: what will happen when they're no longer with us? And
Speaker 4: the truth is we've been just astonished at the demand
Speaker 4: we've experienced.
Speaker 5: Well, so, why do you think that is?
Speaker 4: You know, I think the new stars began to break
Speaker 4: through a bit more last year, the Electric Carlos Alcarez,
Speaker 4: Cocoke Goff, There's so many others, and I think people
Speaker 4: have just rediscovered tennis is amazing. There are new stars
Speaker 4: all the time. And also the US Open is just
Speaker 4: a fantastic experience and there's so much more to do
Speaker 4: than just watch tennis. The tennis, of course is the anchor,
Speaker 4: but it's also just a great event for food and beverage,
Speaker 4: for experience, for being out in a beautiful day.
Speaker 5: Carol mentioned record crowds here earlier this week yesterday top
Speaker 5: seventy three thousand people for the first time. What's capacity here?
Speaker 5: How much bigger could you get if you wanted to
Speaker 5: get bigger?
Speaker 3: I honestly think this is it.
Speaker 4: We're kind of at the cap right we want everyone
Speaker 4: to ensure that they have a great experience, that they
Speaker 4: can get around and get to the different courts, and
Speaker 4: I'm not sure we can expand.
Speaker 5: More than Actually I kind of agree with you, just
Speaker 5: based on my I was here Tuesday night and it
Speaker 5: was super crowded that night too, And you get to
Speaker 5: the point where you know you want to get in
Speaker 5: Court seventeen and you can't actually get in Court seventeen
Speaker 5: because it's full, but there are so many other places
Speaker 5: to go. So I guess I do wonder is like
Speaker 5: how you balance the experience of making sure that people
Speaker 5: get there with money's worth, without maximizing, you know, without
Speaker 5: putting at risk sort of being comfortable here.
Speaker 3: Yeah, and so I think that's it.
Speaker 4: I think we'd love to be able to welcome everyone
Speaker 4: that wanted to come, but at the same time, we've
Speaker 4: got to protect the experience. And that's where the fan
Speaker 4: Week experience becomes really important too.
Speaker 2: How do you you know? I was curious actually thinking
Speaker 2: about early metrics and did you guys quickly get an
Speaker 2: idea what the event was going to be, like, what
Speaker 2: was early demand? Like?
Speaker 4: The earliest one we saw is when we went out
Speaker 4: with the full series subscriber renewal. That's kind of your
Speaker 4: season ticket holder, right if you're a team, And we
Speaker 4: renewed it better than ninety five percent, and at that moment,
Speaker 4: that was in late January, we said wow.
Speaker 2: So literally almost right after.
Speaker 4: Yeah, and at that point in time, you know, you
Speaker 4: don't know who's playing. You know, you know that certain
Speaker 4: players have retired and we'll not be back, but that
Speaker 4: was really just the first indicator of Wow, this is
Speaker 4: going to be big again.
Speaker 2: Kirsten talked to us too about the people who come
Speaker 2: and remind us of how diverse it is, and people
Speaker 2: coming from all over the world.
Speaker 4: Yeah, and the international travel, you know, we've seen it
Speaker 4: in New York is just seems to be really back.
Speaker 4: In a typical pre pandemic year, we'd be anywhere from
Speaker 4: twenty to twenty five percent international attendees at the US Open,
Speaker 4: and we're back to that number. We're back to around
Speaker 4: twenty percent, maybe more. But it's just so so great
Speaker 4: to see.
Speaker 5: So that's something that you actually can't even describe. You
Speaker 5: kind of have to be there to feel it, like
Speaker 5: you're you're on one of these courts and you're seeing
Speaker 5: two players play from not the US, they don't speak
Speaker 5: English as their first language is. And what you have
Speaker 5: as fans who are from those countries or perhaps even
Speaker 5: from New York City, and they're cheering them on and
Speaker 5: in their native languages, and it's like like, this is
Speaker 5: New York. This is New York at its past.
Speaker 6: It is.
Speaker 4: Yeah, you really feel it, and I'm glad you experienced
Speaker 4: that on the outside.
Speaker 5: That's pretty cool.
Speaker 2: Yeah, all right, So talk to us about sponsors, right,
Speaker 2: you have to think about who you're sponsoring. And I
Speaker 2: feel like you have people that are companies and entities
Speaker 2: that have been with you from year to year, but
Speaker 2: how you continue to evolve that or grow that.
Speaker 3: So we have twenty four sponsors.
Speaker 4: We have few long term, very loyal, very deep partnerships
Speaker 4: with these sponsors. Over half of them have been with us,
Speaker 4: actually seven have been with us for more than thirty years,
Speaker 4: very long term partnerships. It's really been extraordinary for us
Speaker 4: to experience. And these partners are are long term. We
Speaker 4: were new at long term, and we want to sure
Speaker 4: that they can meet their objectives here, that they can
Speaker 4: activate their brands and waves that are fantastic, and I
Speaker 4: really hope that you can experience it when you get
Speaker 4: out there watching tennis.
Speaker 3: Stop in some of the sponsor booths as well.
Speaker 6: I bought a.
Speaker 2: Shirt like a Ralph lahmert like I do think about.
Speaker 2: It's not just about somebody slapping a logo.
Speaker 3: No, it's a really deep activation.
Speaker 4: They're really out here interacting with the fans and enhancing
Speaker 4: the experience for the fans in really diverse ways.
Speaker 5: What did you hear from your sponsorship staff this year
Speaker 5: in terms of the ease of getting these renewals, of
Speaker 5: going and getting new sponsors. There are some new partners
Speaker 5: here this year. We like to talk to people like
Speaker 5: you because you have a good read on the entire economy.
Speaker 5: You get those updates each quarter from your staff, But
Speaker 5: what did they tell you throughout the year as they
Speaker 5: were trying to secure these partnerships.
Speaker 4: So in all of our partnerships, I'll say the intent
Speaker 4: to renew is incredibly strong. It's just a question of
Speaker 4: what are your objectives and how do you see them
Speaker 4: evolving over the next term, and how can we help
Speaker 4: you meet those objectives. So that hasn't really been a
Speaker 4: question for new partners. We've seen more demand than we
Speaker 4: can satisfy. We do reach a point where we sell
Speaker 4: out of partnership positions, and we've reached that, and so
Speaker 4: we've got more inbound demand than we can satisfy on
Speaker 4: the partnership front. And that's really an indicator of how
Speaker 4: valuable the audience is to them.
Speaker 2: Do you ever, though you said twenty four, right, is
Speaker 2: there ever, Okay, let's make it twenty six or is
Speaker 2: there do you think about let's not make it where
Speaker 2: we're slapping things, you know what I mean?
Speaker 3: Yes, it's very deliberate.
Speaker 2: Yeah, And so so you do have like kind of
Speaker 2: a top point that you just say that's in that
Speaker 2: we do.
Speaker 4: We want to protect the exposure for the few partners
Speaker 4: that we have at the level that they have and
Speaker 4: ensure that they get the exposure that that they've come
Speaker 4: to expect.
Speaker 2: One thing I want to ask you, because we're going
Speaker 2: to talk a lot. We have a book about Althia Gibson.
Speaker 2: We're going to talk a lot more about equality, university
Speaker 2: and thinking about Billy j and King. At the beginning
Speaker 2: of the week, former First Lady Michelle Obama, how in
Speaker 2: terms of what you do the importance of diversity and
Speaker 2: inclusion and thinking about that in our world and then
Speaker 2: when you think.
Speaker 4: About sponsors, Wow, it's all incredibly important. So okay, so
Speaker 4: you know, we're celebrating fifty years of equal prize.
Speaker 3: Fifty years.
Speaker 4: It's incredible, you know, when we're still seeing that fight
Speaker 4: for equal pay on many different stages and arenas, and
Speaker 4: especially in women's sports. So we're incredibly proud of that.
Speaker 4: But we also like to and our sponsors love this
Speaker 4: that men and women's stay. They play on the same stage,
Speaker 4: they play on the same stage. The best men in
Speaker 4: the world, the best women in the world. They're watched
Speaker 4: by men and women equally. They're watched in person. You know,
Speaker 4: women buy tickets, men buy tickets, they both watch together.
Speaker 4: We're one of the most gender neutral audiences that you
Speaker 4: could find in any sporting event, and so we're really
Speaker 4: proud of that, and our partners love that too, of course,
Speaker 4: they love reaching a very gender neutral and very female
Speaker 4: heavy when you think about sports audience that we offer.
Speaker 5: So, Kirsten, how do you take the momentum from this event,
Speaker 5: again a record setting event, and use that to parlay interest.
Speaker 5: It's the next four or five year olds, the people
Speaker 5: who are going to be the next Francis Tiafo's the
Speaker 5: people are going to be the next Coco Govs.
Speaker 3: So that's why we play, right, That's why we're here.
Speaker 4: This event is here to inspire people to play tennis
Speaker 4: in the United States.
Speaker 5: You make sure they get to experience it though, that
Speaker 5: everybody gets to experience it.
Speaker 4: So the qualifying tournament, which has played the week before
Speaker 4: the main draw, has been repurposed into Fan Week. Okay,
Speaker 4: so the qualifying tournament is the anchor of that Fan Week.
Speaker 4: We are free and open to the public that entire week,
Speaker 4: and all of the main draw players are here practicing
Speaker 4: on courts that are free and open to the public
Speaker 4: to come and sit up close and personal and watch them.
Speaker 4: And so we had a record audience that week. Over
Speaker 4: one hundred and fifty five thousand people came through the
Speaker 4: gates that week. And really we're able to experience some
Speaker 4: of the top pros in the world up close and personal,
Speaker 4: but also watch some incredibly competitive tennis in the qualifying side,
Speaker 4: and all fan activations with our partners, and opportunities for
Speaker 4: kids to get on courts and really hold a racket.
Speaker 4: Wilson distributed tens of thousands of free rackets. That's great
Speaker 4: free rackets to those that had registered for the free
Speaker 4: fan access pass, and so we're literally getting rackets into
Speaker 4: kids hands during that first fan week and it's just
Speaker 4: so gratifying for us to see them then take those
Speaker 4: into their communities and play.
Speaker 2: Just have about twenty five seconds left here. What have
Speaker 2: you seen in terms of the interest among a younger
Speaker 2: population in general, either coming to it and also just
Speaker 2: playing in tennis.
Speaker 4: Well, I think you may have some time with our CEO, Loocire,
Speaker 4: and we love to talk about the growth over the
Speaker 4: past three years that we've enjoyed in tennis. We've got
Speaker 4: over twenty three million active players in the United States,
Speaker 4: over thirty percent increase over the past three years, and
Speaker 4: much of that coming from diverse populations where we want
Speaker 4: tennis to look like America and feel like America, and
Speaker 4: that includes the.
Speaker 3: Youth population of the course as well.
Speaker 2: You're so fun.
Speaker 3: I love being here with you guys. Thanks for having me.
Speaker 2: We love talking to you.
Speaker 5: We just wish we could do this more than two
Speaker 5: days a year.
Speaker 2: Can be coming from you.
Speaker 5: We will.
Speaker 2: Absolutely Kirsten, thank you to be well. Thank you for
Speaker 2: having Kriston Courier, USTA Chief Commercial Officer right here at
Speaker 2: the US Open. You are listening and watching Bloomberg Business Week.
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Speaker 2: Call Master along with Tim Stenvik live at the US
Speaker 2: Open at the Arthur Ash Stadium. Literally right now, we're
Speaker 2: just in the midst of everything.
Speaker 5: I can hear, you can hear the officials, you can
Speaker 5: hear the crowd hearing. Yes, you can sometimes hear a
Speaker 5: passionate player maybe grunter or scream. That's all part of
Speaker 5: the fun here at the US Open.
Speaker 2: It's so much fun, it's so alive. It's just a
Speaker 2: blast to be here. Having said that, we're sorry to
Speaker 2: our Bloomberg News team in particular, who we know are
Speaker 2: fans of.
Speaker 5: That is so cruel. Okay, next year, you guys are
Speaker 5: coming here with us.
Speaker 2: Okay, all right, We've got two great stories. One is
Speaker 2: about former US First Lady Michelle Obama. She spoke at
Speaker 2: Arthur Ash earlier in the week advocating for equal pay
Speaker 2: for female athletes. And she's really the latest prominent figure
Speaker 2: to push for progress in women's sports. We talked about
Speaker 2: it a little bit with Kirsten about the importance of
Speaker 2: equality and diversity and then writing about how the US
Speaker 2: Open is a test for Carlos Alcoraz.
Speaker 5: Yeah, is he the next great tennis player? Now that
Speaker 5: the Big three is no longer the Big Three? We
Speaker 5: got Ira Bouduat joining us. He is Bloomberg News Global
Speaker 5: Business reporter on zoom in New York City. Also with
Speaker 5: us is Bloomberg News Senior reporter Jillian tan Back right
Speaker 5: now in our Bloomberg Interactive Brokers studio.
Speaker 2: I feel like, Jillian, we need to start with you
Speaker 2: because I feel like equality when it comes to sports
Speaker 2: remains an issue, and I know the USTA is working
Speaker 2: on it. But tell us about Misschelle Obama, the former
Speaker 2: First Lady, earlier in the week, because she had a
Speaker 2: pretty strong words.
Speaker 7: Yes, so she kicked off sort of Monday night action
Speaker 7: after Cocoa Golf one on Monday Night. She came out
Speaker 7: honored Billy Jan King, who where exactly you are? You
Speaker 7: guys are in the Billy Jing King National Tennis Center,
Speaker 7: and so Billy Jan King fifty years ago, went out
Speaker 7: found sponsors and was actually Bristol Meyer's squib that came
Speaker 7: up with equal prize money for women's tennis. The year earlier,
Speaker 7: in nineteen seventy two, she cashed a ten thousand dollars
Speaker 7: check her male counterpart, Gilli Nastazi twenty five thousand. So
Speaker 7: it was Billy Jinking fifty years ago pioneered you know,
Speaker 7: equal pay in sport. It took the other Grand Slams,
Speaker 7: you know, decades to catch up. The Australian Open only
Speaker 7: did it in two thousand and one, the French Open
Speaker 7: in six and Wimbledon was the last in two thousand
Speaker 7: and seven, with Venus Williams sort of helping get that along.
Speaker 7: But what's crazy is it's twenty twenty three and some
Speaker 7: of the like lead up tournaments to the US opened
Speaker 7: in Cincinnati, in DC, there's still you know, women are
Speaker 7: owning a fraction of what the men are earning.
Speaker 5: Yeah, I'm so glad you mentioned Cincinnati. I mean, it
Speaker 5: was remarkable to see that the women's prize pot is
Speaker 5: less than half of what men men get. I mean,
Speaker 5: but it's not just tennis, Julian. This is like I mean,
Speaker 5: think about the struggle of the US national women's soccer
Speaker 5: team and female soccer players that we've experienced here in
Speaker 5: the US.
Speaker 3: Yeah, exactly.
Speaker 7: So the World Cup recently has thrown a huge spotlight
Speaker 7: on it. Like our colleagues wrote about how in Spain.
Speaker 7: You know, there's a lot of debate, especially in Spain one.
Speaker 7: But it's not just in soccer, it's in basketball, It's
Speaker 7: in pretty much every sport across the globe. You know,
Speaker 7: tennis is one rare sport where prize money is equal,
Speaker 7: but it only in certain events like the one that's
Speaker 7: happening this fortnite at Flushing.
Speaker 2: IIRA. We want to bring you into the conversation. You've
Speaker 2: got a great story about Carlos Alcoraz, but before we
Speaker 2: get to it, you know, you cover sports, you love sports.
Speaker 2: What do you think about, you know, when it comes
Speaker 2: to still kind of this fight for equality between women
Speaker 2: and men when it comes to sports, you.
Speaker 8: Know, I think tennis is are really good. I mean,
Speaker 8: I don't think it's an accident that Billy jan King
Speaker 8: has been a pioneer in this and that tennis is
Speaker 8: really part of what has led the way for equal
Speaker 8: pay because it is an individual sport primarily, and the
Speaker 8: women have been a huge draw. Serena Williams one of
Speaker 8: the biggest athletes of our generation, male or female, and
Speaker 8: so I think they have some of that leverage and
Speaker 8: Billy Jing King really showed them how to use it.
Speaker 8: But the job is still not done. What it is
Speaker 8: surprising to see at this stage in the game that
Speaker 8: we still have competitions on the tour that are not
Speaker 8: with equal prize money.
Speaker 5: So the tour that's really surprising to oh, go ahead.
Speaker 3: You sorry, just to jump in.
Speaker 7: Like the tour actually has been feeling the heat from
Speaker 7: the whole world sort of saying, hey, what's going on, guys,
Speaker 7: And they've actually outlined a plan to have equal prize money,
Speaker 7: but not till twenty twenty seven at some of these
Speaker 7: big events.
Speaker 2: Why so long? Why is everything so long? All you
Speaker 2: have to do is like say.
Speaker 5: Give me the money, wit, just do.
Speaker 3: Sponsorship, Carol.
Speaker 7: So it's about you know, the sponsors. You know they
Speaker 7: don't believe the eyeballs. The viewership is there, but if
Speaker 7: you know, if your numbers are to believe, like the
Speaker 7: US up the soccer down in Australia, like the ratings
Speaker 7: were off, the charts.
Speaker 2: Well, we just talked with Curio. She is here, she's
Speaker 2: chief commercial officer, she's doing the sponsorships. We just talked
Speaker 2: to her about this issue. And even though you don't
Speaker 2: have you know, Serena here, you know that things are changing.
Speaker 2: The older you know, elite if you will, from tennis
Speaker 2: is moving on slowly. That still you're getting record numbers here.
Speaker 2: So it's just interesting about this idea that the eyeballs.
Speaker 2: I don't know, I feel like it's an old argument.
Speaker 2: Having said that, we do want to get to Ara
Speaker 2: your story. Talk to us about Carlos Alcarez. He's a
Speaker 2: young he's part of the next generation potentially.
Speaker 5: Yeah, I mean for sure.
Speaker 8: And this has been the question in men's on the
Speaker 8: men's side for decades. Now, what happens when Federer, Nadal
Speaker 8: and Djokovic you're done? And now that Feder's retired and
Speaker 8: the Doll's about to retire, Djokovic looks like he has
Speaker 8: some you know, left in the tank, but is obviously
Speaker 8: in his twilight years or entering them. Who's next? And
Speaker 8: I think Wimbledon and last year's Open, we kind of
Speaker 8: got a glimpse anyway at the answer and it's Carlos
Speaker 8: Alcaraz and what I was writing about is the opportunity
Speaker 8: that that presents him because if he can sort of
Speaker 8: consolidate that and dominate on the men's side for the
Speaker 8: next decade or two, because he is only twenty, he
Speaker 8: could very realistically be the next sort of billion dollar
Speaker 8: at fleet. You know, you look at Roger Federer's lifetime
Speaker 8: earnings on the court prize money, but also off it
Speaker 8: where you get the majority tennis players as in an
Speaker 8: individual sport, they can really cash in, and so Alcarez
Speaker 8: stands to really profit from his brilliant play recently.
Speaker 5: It's interesting, I right, tennis players can really cash in
Speaker 5: if they're the top of the top right five of
Speaker 5: the fifty highest earning athletes of all time. This is
Speaker 5: in your story according to estimates by Sportico are tennis players.
Speaker 5: The thing is is you have to be the top
Speaker 5: of the top and actually to actually make a living,
Speaker 5: because you know, there are so many players out there,
Speaker 5: many of whom qualified for the US Open this year
Speaker 5: that really, you know, essentially live tournament to tournament and
Speaker 5: paycheck to paycheck. Yeah, I mean, it is.
Speaker 8: A ruthless eat. What you kill sport and the pyramid.
Speaker 8: You know, the difference between one and ten is huge,
Speaker 8: and the difference between ten and one hundred and the
Speaker 8: rankings is even wider. It's just very difficult. But if
Speaker 8: you can get to the top with the mountain, the
Speaker 8: rewards are as rich as an in sport. And for Alcarez,
Speaker 8: it's interesting because in talking to marketing people, talked with
Speaker 8: guy Bob Dorfman, who does sports marketing and clinical advertising,
Speaker 8: he's saying, you know, the ceiling is the limit for
Speaker 8: him in terms of categories endorsement deals. Besides the obvious
Speaker 8: stay healthy, keep winning, he needs to sort of start
Speaker 8: to show his personality. Obviously, in US is the biggest market.
Speaker 8: Everyone's always waiting for the next US tennis star. But
Speaker 8: Alcarez can really capture that too if he works on
Speaker 8: his English a little bit more and just kind of
Speaker 8: let's let's the world see who he is. I was
Speaker 8: at this event at a low Ta Palace hotel before
Speaker 8: the Open, where they had him and a few other players,
Speaker 8: and he really was the star of the show. It's
Speaker 8: a little cocktail hour and he has a big, contagious smile.
Speaker 8: He clearly knew how to work a room. But I
Speaker 8: think we've get to see that kind of leveraged in
Speaker 8: a big way in endorsement deals and in marketing.
Speaker 2: You know, Jillian, As we look at the next round
Speaker 2: for men's players in tennis, the next general, I think
Speaker 2: about the next generation for women and we're starting to
Speaker 2: see that. We certainly saw it last time around. But
Speaker 2: I do think about last time that I was here
Speaker 2: at the Open, I watched Serena and Venus play in
Speaker 2: a doubles match, and I watched Serena.
Speaker 5: Play what you saw her last match?
Speaker 2: I saw her last match. You know, when I do
Speaker 2: think about the next generation for women, how are you
Speaker 2: thinking about it? And we really I think all did
Speaker 2: think Serena and Venus would make it so that there
Speaker 2: was more parody, and they definitely have moved it along.
Speaker 2: But we still have a ways to go.
Speaker 7: Yeah, I mean, I think there's a bunch of upcoming styles. Obviously,
Speaker 7: Coco's leading the way. Jessica Pagola, her dad owns the
Speaker 7: Buffalo Bills, She's the third seed. Her and Coco actually
Speaker 7: played doubles together. Like there's another American called Alicia Parks.
Speaker 7: Like the bench is deep and to our's point about
Speaker 7: you know upcoming US players. There's a couple that are
Speaker 7: really already stamping their foot on the map, Francis Tfo
Speaker 7: and then Chris Eubanks being one that've had had deep
Speaker 7: runs and slams.
Speaker 2: All right, well, great stuff.
Speaker 5: Looking forward to seeing a handful of those players today.
Speaker 2: Absolutely, absolutely, there's a lot right to look out for.
Speaker 2: Wish you guys both were here, but really fun to
Speaker 2: read both of your stories, So thank you so much
Speaker 2: for joining us today. Jillian tan of Courstinia, reporter at
Speaker 2: Bloomberg News back there in our interactive Brokers studio at
Speaker 2: Bloomberg Headquarters in Ira Boodway, Global Business Reporter and on
Speaker 2: zoom from New York City. That story a BusinessWeek story,
Speaker 2: so check it out to at Bloomberg dot com slash BusinessWeek.
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Speaker 8: On grass A play everyday.
Speaker 3: Okay, good time is ironic?
Speaker 9: Shall we say ball is in your court.
Speaker 2: Love it grass clay and they're playing it. It's not
Speaker 2: grass here though, Nope, not these days, Nope, nope, not
Speaker 2: these days. One of the things I don't know when
Speaker 2: it comes to you, I don't know if grass could
Speaker 2: be better with AI. Do you think it could be
Speaker 2: better with AI?
Speaker 5: Well, Wimbledon, Yeah, I guess so.
Speaker 2: Yeah. Anyway, we're gonna talk a little bit about AI,
Speaker 2: Artificial intelligence. It permeates everything that we do, including what's
Speaker 2: going on here at the US Open.
Speaker 5: Yeah. The US Open is actually harnessing AI through their
Speaker 5: partnership with IBM. So we've talked a lottle bit in
Speaker 5: the past, Carol about player analysis and predictions that are
Speaker 5: powered by IBM. But here's something cool that the tournament
Speaker 5: is doing this year. AI generated commentary for match highlights,
Speaker 5: so the USCA can quickly get the highlights out of
Speaker 5: fans around the world. You know, you have hundreds of
Speaker 5: thousands of people come to this event every year. Yeah,
Speaker 5: but you have millions of people who actually follow the
Speaker 5: event of the USTA website and also through the app,
Speaker 5: and they need to get quick updates. And I guess
Speaker 5: my question is, you know, are we going to be
Speaker 5: out of a job because they don't even need announcers anymore.
Speaker 2: No's laughing, We're not laughing.
Speaker 7: No.
Speaker 2: Psychon is abou Us. He's VP of Sports and Entertainment
Speaker 2: Partnerships at IBM. Once again back with us on site
Speaker 2: at the US Open.
Speaker 5: How are you I'm excellent.
Speaker 2: How are you guys doing well? So tell us about this.
Speaker 10: So AI commentary. There's a lot of tennis going on
Speaker 10: out here. There's seventeen courts of action, but there's only
Speaker 10: commentators on two or three courts. We know Patrick McEnroe,
Speaker 10: John McEnroe, Chris ever Well, a lot of videos captured
Speaker 10: from those courts, and the USTA really asked us, you know,
Speaker 10: how do we create a better experience for people who
Speaker 10: are who are seeing these highlight packages? How do we
Speaker 10: lay commentary on top of those packages? And so that
Speaker 10: was a great challenge. So when you go to the
Speaker 10: US Open dot org this week or download the app
Speaker 10: and you see these highlight packages for every singles match,
Speaker 10: what you'll see is AI generated commentary laid on.
Speaker 5: Top of them. When you say commentary, do you mean
Speaker 5: just text on screen or do you mean actual voice?
Speaker 10: We have voice commentary, So we'll provide a little texture
Speaker 10: about who those players are, maybe something about how they've
Speaker 10: played before, what countries there.
Speaker 5: Does it sound like a human being or does it
Speaker 5: sound like a robot?
Speaker 10: Well, I don't know what a robot sounds like anymore,
Speaker 10: but you know you're trying.
Speaker 5: I am that's what a robot sounds Definitely not.
Speaker 10: Look, we all have our GPS or our little smart
Speaker 10: devices and we have those voices and it sounds pretty
Speaker 10: much like that. But what we're excited about. In addition
Speaker 10: to what we're doing today, we're doing English language. But
Speaker 10: if you think about the players that come out here,
Speaker 10: they're from countries around the world. They have fans around
Speaker 10: the world. So next year we'll be doing multi language translation.
Speaker 10: So wherever you are in the world, you're going to
Speaker 10: get highlights in your language, which isn't available today.
Speaker 2: How does it work, Like, what's the pull of information
Speaker 2: that it's using to do that to make sure it's good.
Speaker 2: I'm sure you have people who are fact checking and
Speaker 2: reviewing it, But how does it all work?
Speaker 10: Yeah, So there's data feeds that come off the court, right,
Speaker 10: and that captures all the statistical data from the court
Speaker 10: from each competition. Then we use a large language model,
Speaker 10: which is the underpinning of our Watts next generative AI platform.
Speaker 10: That large language model knows language already. It's already been
Speaker 10: taught language. So what we teach it is tennis, what
Speaker 10: a passing shot is, what a winner is, what Arthur
Speaker 10: ash Stadium is versus Louis Armstrong Stadium, So it knows language.
Speaker 10: We bring in the data feed, we teach it what
Speaker 10: a winner is in all those different dimensions, and then
Speaker 10: we bring them together to generate the commentary. So it's
Speaker 10: the data coming off the court combined with large language model,
Speaker 10: combined with teaching tennis to the AI.
Speaker 5: I'm not being facetious with this question at all, but no,
Speaker 5: but I'm wondering about personality. You mentioned you know, the
Speaker 5: Macenroe brothers, Chris ever, like this is those people are
Speaker 5: great at what they do. Because they're great at what
Speaker 5: they do. I mean, if their personalities come across we
Speaker 5: know them by now. If you've been watching tennis, you
Speaker 5: know them. If you just watch the US Open for
Speaker 5: two weeks, you get to know them. How do you
Speaker 5: give these bots personalities?
Speaker 10: I don't know if person the right way to think
Speaker 10: about it, but you know, reflecting on some of the commentators,
Speaker 10: if you were out here at eight, nine, ten o'clock
Speaker 10: this morning, you'd probably see those commentators roaming around the
Speaker 10: practice courts. They know the players, they know the coaches, right,
Speaker 10: So there's texture that the commentators have. They'd probably have
Speaker 10: seen these players grow up. Frankly, there's texture that the
Speaker 10: commentators have that the AI probably doesn't have. What we
Speaker 10: give is a little bit of inflection. So the AI
Speaker 10: knows what a breakpoint is, So the commentary around a
Speaker 10: break point is going to have a little bit more substance,
Speaker 10: a little bit more flair, so to speak, than a
Speaker 10: different point or the end of the mat or end
Speaker 10: of the set, all of those different dimensions around tennis
Speaker 10: or what drives a little bit more inflection and texture.
Speaker 9: In the voice.
Speaker 2: How does generative AI change Watson?
Speaker 10: Well, I don't know if generative AI changes Watson, but
Speaker 10: the Watson X platform is going to change how AI.
Speaker 5: Is able to be created, meaning what speed.
Speaker 10: Speed, and the availability of large linelanguage model. So, like
Speaker 10: I said, we use one of these large anguish models
Speaker 10: that was already taught speech and language, so it's already there,
Speaker 10: pretty baked. Now tune it to your task. Your task
Speaker 10: may be tennis, your task may be creating a chatbot
Speaker 10: for a big bank to serve your customers better. So
Speaker 10: those underpinning development platforms have pre baked models that allow
Speaker 10: for more rapid development, more of raried use gives.
Speaker 2: I keep thinking of the Jeopardy example, and I bring
Speaker 2: this up because you were very involved in all of this,
Speaker 2: and I'm just thinking, like, what did it take to
Speaker 2: make that work as well as it did? And now
Speaker 2: how many years later we're like, oh my god, generated
Speaker 2: AI And I'm just curious how you guys are thinking
Speaker 2: about it and what it means like the next level.
Speaker 10: Well, look, yeah, I'm glad the world finally caught off
Speaker 10: to us, and the Jeopardy.
Speaker 2: Probably handed that to you. You're welcome.
Speaker 5: I'm glad that the world up, but I'm curious caught
Speaker 5: up to that.
Speaker 10: But you know, it's really a whole differ for an
Speaker 10: animal now from where we were, you know, years ago,
Speaker 10: and people are concerned about, you know, the challenging parts
Speaker 10: of AI, but the reality is, just like at the
Speaker 10: US Open AI is going to be assisting people that
Speaker 10: we're not replacing the commentators, We're adding new flavor We're
Speaker 10: adding you know, value into the white space the courts
Speaker 10: that weren't covered. And I think that's how businesses are
Speaker 10: going to be thinking about it as well. You know,
Speaker 10: how do I create new experiences that add value.
Speaker 2: It's been the uptick in that in terms of that.
Speaker 2: You've done that the coverage, right, you started it.
Speaker 10: Yeah, we started this actually at the Masters. Okay, we
Speaker 10: progressed at Wimbledon. Now we bring it at the USC
Speaker 10: So at Wimbledon we saw over two and a half
Speaker 10: million views of these videos, right, and we started with
Speaker 10: the commentary defaulted off and immediately we saw people turning
Speaker 10: them on and wanting to hear this commentary, and so
Speaker 10: it went to default on. We try to take a
Speaker 10: little slow start to anything, make sure that the users
Speaker 10: are having a positive experience, and we saw that at Wimbledon.
Speaker 5: They know the USTA and the US Open. You've had
Speaker 5: this more than thirty year relationship with IBM with them.
Speaker 5: How do you draw a line from the money you
Speaker 5: spend here to top line growth at the company.
Speaker 10: Yeah, Well, one of my most exciting moments is when
Speaker 10: we're with a client or a customer and we share
Speaker 10: what we're doing. Well, you know, how we created this
Speaker 10: engagement with fans or use large language models, and when
Speaker 10: the clients turn to us and say we need that,
Speaker 10: we need to bring that into our business. That's a
Speaker 10: direct line between what we do here and a client
Speaker 10: saying we need to work with.
Speaker 5: You more deeply. So what I'm hearing is upselling, not
Speaker 5: necessarily new customers.
Speaker 10: I think it's probably a little bit of both. You know,
Speaker 10: if you're experiencing this on a mobile application or a website,
Speaker 10: we get inbound demand like I want to know more
Speaker 10: about that semi setup and appointment with one of our experts.
Speaker 10: So it's a little bit of both, but certainly there's
Speaker 10: a big expansion that we see with existing clients.
Speaker 2: When you think about kind of where it goes next? Right,
Speaker 2: thirty years, you guys have been working and developing different
Speaker 2: things to kind of have fun when the customer experiences
Speaker 2: your clients, the IBM customers, So how do you think
Speaker 2: about kind of where it goes, like, what's next? What's
Speaker 2: after you've done?
Speaker 10: Your boss is like, yeah, I'm not a huge prognosticator,
Speaker 10: but I really just think about how how productivity is
Speaker 10: going to be accelerated with these capabilities.
Speaker 5: Think about coding.
Speaker 10: Coding is going to be one of the first places
Speaker 10: you know, AI generated code is going to Again we've
Speaker 10: talked about speed earlier. Yeah, if AI can help coders
Speaker 10: generate code to create new experiences more quickly, then businesses
Speaker 10: are going to be able to please their customers.
Speaker 2: If Microsoft hadn't made that investment and announcement, would we
Speaker 2: be talking as much about AI? In your view, would
Speaker 2: something else I've done it or would have I'm just curious,
Speaker 2: like all of a sudden, it's not like it's new.
Speaker 10: No, I don't know if it's a matter of the
Speaker 10: investment or not. I think it's a matter of when
Speaker 10: people touch these things, it just it just creates an
Speaker 10: extra level of interest. And I think some of the
Speaker 10: things we've seen with chat, GPT, where now people can
Speaker 10: literally get their hands on it.
Speaker 5: Yeah.
Speaker 10: You know, if you have a college student trying to
Speaker 10: write a college essay, now they're having a very visceral
Speaker 10: aperience with you know, how language can be used. But
Speaker 10: the reality is that trust is going to be really
Speaker 10: important in this era. Were using trusted data and that's
Speaker 10: what we really pride ourselves.
Speaker 2: We have a colleague, Matt miller Man. He's on top, what.
Speaker 5: He's doing on that thing, what he's doing asking it everything.
Speaker 2: Thank you so much, Thanks Ron, We always appreciate it.
Speaker 2: In to a psych in VP of Sports and Entertainment Partnerships.
Speaker 2: He's a busy guy here at IBM.
Speaker 1: This is Bloomberg Business Wait inside from the reporters and
Speaker 1: editors who bring you America's most trusted business magazine, plus
Speaker 1: gloom O Business Finance and tech news. The Bloomberg Business
Speaker 1: Week Podcast with Carol Messer and Tim Stenebeck from Bloomberg Radio.
Speaker 2: Carol Masser on Tim Steneviick live at the US Open.
Speaker 2: We're just outside Arthur ash Stadium, having really a lot
Speaker 2: of fun. And when she's not here at the Open,
Speaker 2: although she is right now, she comes every year all
Speaker 2: the time with her family. She's usually pretty busy reporting
Speaker 2: on some really important stuff.
Speaker 5: Yeah, she's got an education angle and economic one. And
Speaker 5: in the end, it's all about the big money in
Speaker 5: the form of college endowments or the big moves that
Speaker 5: are happening when it comes to some of these colleges
Speaker 5: and universities.
Speaker 2: See a move today, Bloomberg News Higher Education financial putter
Speaker 2: Janet Lauren here with us on site at the US Open. Hello, Hello, Hello,
Speaker 2: thanks for having me again. We love having you here.
Speaker 2: We love seeing your family. They're on the sidelines. Some
Speaker 2: news today Yale's president. What's going on?
Speaker 9: Yeah, Peter Salvey announced that he is retiring after eleven
Speaker 9: years of leading Yale in New Haven, Connecticut, and he's
Speaker 9: going to go back to being a professor. You probably
Speaker 9: don't know this, but he was one of the people
Speaker 9: who developed the idea of emotional intelligence.
Speaker 2: I did not know that. So why is he like done?
Speaker 9: Well, it's been a tough decade plus one in higher education.
Speaker 9: We had COVID, There's a lot of fundraising, and it's
Speaker 9: been a tough time. Finances are not so easy. This
Speaker 9: year we're going to talk about endowment returns. Last year
Speaker 9: was not a great year for endowment so the Yale
Speaker 9: of the Ivy League schools was the only one that
Speaker 9: was had a positive return.
Speaker 5: What is a typical tenure for a college professor, I
Speaker 5: mean a university president who oftentimes are start at.
Speaker 2: Of course they're always college professors.
Speaker 9: It used to be about ten years, but lately we've
Speaker 9: been seeing a lot of retirements. Keep in mind, one
Speaker 9: of the biggest jobs is not teaching, which is the
Speaker 9: fun part for them, but it's raising money.
Speaker 5: It's like, come on, that's all they do is raise money.
Speaker 9: But right now dealing with some big issues affirmative action.
Speaker 9: Yale was not a litigant, but it's one of its rivals.
Speaker 9: Harvard was, and that's what a lot of them are
Speaker 9: trying to figure out how they're going to go about
Speaker 9: the school the next academic cycle where they're recruiting kids.
Speaker 9: Do you don't talk about race, but Harvard, you know
Speaker 9: their essay. They've changed their essay, and it's not going
Speaker 9: to be an easy time, although of course they've been
Speaker 9: expecting this for the last year.
Speaker 2: Yeah, it's funny that you say that. I was talking
Speaker 2: actually with Tom Keane and he's got a daughter who's
Speaker 2: getting ready or starting to think about college and so
Speaker 2: and so forth. But what's interesting is investment officer, I
Speaker 2: don't know you are hearing you have you have to
Speaker 2: figure out, right, bill Stone?
Speaker 5: Bill Stone, all right, they're going to get that next once.
Speaker 5: We're gonna keep talking to Janet.
Speaker 2: We are, we are, But he was talking about that.
Speaker 2: All of a sudden, they're thinking about training for kids
Speaker 2: for S A T S and P S. A TS again.
Speaker 2: I'm like, I thought they were done with that. He's like, no,
Speaker 2: Apparently colleges are finding that that's a good way of
Speaker 2: a good metric to figure out if kids can do
Speaker 2: well at their schools.
Speaker 9: Yes, well, m I T last year said we are
Speaker 9: bringing it back, and m I T is one of
Speaker 9: a few outliers. Many of the schools are still saying
Speaker 9: we're going to give it another couple of years. We
Speaker 9: want to evaluate how our kids are doing in their
Speaker 9: freshman year. But m I T is a place where
Speaker 9: you got to do the math and science in order
Speaker 9: to be successful. Purdue also announced that they are going back,
Speaker 9: and another school, Georgia Tech, only had a.
Speaker 3: Had the the pause.
Speaker 2: For one year of the requirement.
Speaker 5: Is that going to be the trend? Do you think
Speaker 5: we'll start to see colleges bring it back.
Speaker 3: It's unclear.
Speaker 9: Especially with the Affirnative Action ruling. There's a question of access,
Speaker 9: and everybody knows that wealthier kids tend to do better
Speaker 9: because they have more resources for test prep, they perhaps
Speaker 9: have more time, and so we'll see.
Speaker 2: It's it's been very interesting, you know.
Speaker 9: Harvard announced about a year and a half ago that
Speaker 9: they were going to have a four year moratorium before
Speaker 9: anybody else did, and you kind of think, well, what
Speaker 9: do they know that everybody else doesn't know. And while
Speaker 9: they were, they were preparing for what was the inevitable
Speaker 9: Afferative Action ruling a couple months ago.
Speaker 2: It's getting harder and harder right to run a university system.
Speaker 2: Go back to you were talking about endowments, So what
Speaker 2: are we seeing this year? Because they've had a tough year.
Speaker 9: Yeah, so this year we're hearing you know, eight point
Speaker 9: seven percent, which doesn't sound like a bad year, but
Speaker 9: then you throw in inflation and there's not really a
Speaker 9: lot left and considering last year was on average was
Speaker 9: a minus ten percent return, not such great time. So
Speaker 9: people say, but what are you talking about? Harvard has
Speaker 9: fifty billion dollars. How is that not enough money? Which
Speaker 9: is an excellent point, but they're you know, they're used
Speaker 9: to spending a lot. It's constrained. You know, if you
Speaker 9: get a get a gift for you know, the Yale
Speaker 9: hockey team, you can't spend it on a science building.
Speaker 9: So it'll be interesting to see, you know, we know
Speaker 9: that most of these big endowments are in an alternatives,
Speaker 9: in private equity and hedge funds, and you know, there's
Speaker 9: an influx huge amounts of money chasing the same deals
Speaker 9: and the returns aren't as great. And the smaller endowments
Speaker 9: this year actually did better. Look at the stock market,
Speaker 9: it was up eighteen percent in that same period.
Speaker 5: So when you have a college endowment that doesn't do
Speaker 5: as well as the benchmarks, how does it play out
Speaker 5: when it comes to admissions, How does it play out
Speaker 5: when it comes to investments at the college or university
Speaker 5: makes in terms of expanding the campus and access as well.
Speaker 9: So good question. They are going to say the same
Speaker 9: thing year after year. We don't look at the one
Speaker 9: year return. We're really more concerned at the ten you return.
Speaker 9: But that's also constrained if you look at some of
Speaker 9: the larger schools like Princeton, for example, is a really
Speaker 9: good example. They've had stuff returns year after year, and
Speaker 9: they decided several years ago that they're going to show
Speaker 9: that they're spending their money and they enlarged their class size.
Speaker 9: So I believe we're in the second year where they're enlarging.
Speaker 9: Each freshman class is bigger by several hundred students. They're
Speaker 9: building a brand new campus. If you walk in that school,
Speaker 9: around that campus, there's tons of construction. So they're saying
Speaker 9: to Congress, hey, we recognized we've got a lot of money,
Speaker 9: but look we're spending it because don't forget, they were
Speaker 9: taxed in the Trump techs era twenty seventeen. Endowment's had
Speaker 9: the worst fear was being text and they're still working
Speaker 9: on trying to repeal them.
Speaker 2: Speaking of a tax, we do wonder kind of the impact.
Speaker 2: I don't know if this is apples to apples, but
Speaker 2: what's going to happen as we start to see students
Speaker 2: having to pay back their student loans. Right, there's been
Speaker 2: a moratorium of post pandemic and during the pandemic obviously,
Speaker 2: but that's going to change, and we talk about it
Speaker 2: a lot in terms of the economic impact. You've been
Speaker 2: writing about this as well.
Speaker 9: Yes, So come September first interest starts accruing and come out.
Speaker 9: In October, first students will former students will start to
Speaker 9: see their bills come and it's a big change. After
Speaker 9: three and a half years there has been no interest accruing,
Speaker 9: no debt collection, and the and it's you know, you
Speaker 9: keep this in mind, if the US government was a
Speaker 9: bank it would be the fifth largest bank in America.
Speaker 2: That's the stat that stuck out for US, I think.
Speaker 9: So it's a lot of craziness within the Education Department
Speaker 9: trying to work with their loan services and try to
Speaker 9: let students know how much they're bank and there's so
Speaker 9: many different repayment plans, and it's kind of confusing.
Speaker 5: What's happened to the services over the servicers over the
Speaker 5: last three years.
Speaker 9: So a bunch of them have left and Naveant the
Speaker 9: big one is gone, formerly selling may and and they've
Speaker 9: been consolidated among smaller so it's you know, it's going
Speaker 9: it's kind of confusing when I believe it's at least
Speaker 9: three quarters of students are getting a new loan servicer.
Speaker 9: You know. The bottom line is you've got to be
Speaker 9: in touch with your servicer and not wait and be proactive.
Speaker 2: I feel like when we talk student loans, are we
Speaker 2: talking down because it's all just like Jennas of money.
Speaker 5: They'll find you, you know, That's what I know about
Speaker 5: these these student loan services. They'll find you that's so true.
Speaker 2: Or they'll garnish your wages back to that. It happens,
Speaker 2: all right, thank you. So much. Enjoying the most helping
Speaker 2: Janet Lauren of course at Bloomberg News, Higher Education Finance.
Speaker 2: For for joining us here at the US Open. Carol Masser,
Speaker 2: Tim Stenovic, And this is Bloomberg.
Speaker 6: Brother Marc.
Speaker 1: A journal How about you let me drive?
Speaker 5: Oh no, no, no, no, please going to drive, honey, please,
Speaker 5: I'll do gravels.
Speaker 1: Let's wat I want to drive.
Speaker 9: It's a good question.
Speaker 5: Try This is the drive to the Globes dot com.
Speaker 1: Think we'll buy around on Bloomberg Radio.
Speaker 2: All right, everybody's just about eighteen minutes left to go
Speaker 2: until we wrap up the Thursday trade and ice breeze
Speaker 2: blowing through us here at the US Open. And delighted
Speaker 2: to have with us to talk about the trade. Bill Stone,
Speaker 2: chief investment officer at Glenview Trust Company. Nice to have
Speaker 2: you back with us.
Speaker 6: Thanks for having me, Nice to be there.
Speaker 2: What should we talk tennis?
Speaker 5: Should we talk about tennis?
Speaker 2: What's what? What can you actually predict who's gonna win
Speaker 2: or where the markets.
Speaker 3: Are gonna go?
Speaker 6: I can do neither. You know, I was always a
Speaker 6: feederer guy, so you know, now I have to find
Speaker 6: a new you know, who's it gonna do? I don't know.
Speaker 5: I got some ideas.
Speaker 6: I think I'm since I'm old, I'm gonna pull for
Speaker 6: the old guys and go, you know, Djokovic for now
Speaker 6: while he's here. And but you know, it's really nice
Speaker 6: to watch Alcaraz. It's nice to see some new faces
Speaker 6: on me.
Speaker 5: He's still here.
Speaker 6: I just watched them for a little while.
Speaker 5: Yeah, that was good.
Speaker 6: Isner unfortunately knocked out, but enjoyed seeing him in his
Speaker 6: last her Ah. So you know, Tafo, Yeah, this is
Speaker 6: good to watch. I love tennis, so I can watch
Speaker 6: pretty much anything if it's you know, good tennis.
Speaker 2: Powell, you know, because a dead concert. I'm not sure
Speaker 2: if he plays tennis. I don't know that. You know,
Speaker 2: we kind of make a joke out of it. I
Speaker 2: know it's important in terms of what the Fed does,
Speaker 2: but on any give a day, the thinking around monetary
Speaker 2: policy where rates go can change in a heartbeat. So
Speaker 2: for investors, what do you think is really constructive to
Speaker 2: focus on?
Speaker 6: So I just try and figure out or think about
Speaker 6: how sticky this inflation is going to be, you know,
Speaker 6: I mean you can cut it a million different ways. Actually,
Speaker 6: maybe you asked me a question, what's constructive I'm not
Speaker 6: sure that's constructive, but that's what I spend time thinking
Speaker 6: about because I'm I just try and figure out, well,
Speaker 6: you know, the market's pricing in no more hikes. To me,
Speaker 6: it seems hard. I actually think we have at least.
Speaker 5: One more hike and maybe more in Why Why do
Speaker 5: you think that?
Speaker 6: Because I just think, well, and it all goes We'll
Speaker 6: keep preluding the job the jobs report tomorrow, But I
Speaker 6: just think that it's hard for wages to come down
Speaker 6: enough to then help out on kind of core inflation.
Speaker 2: It's sticky.
Speaker 6: Yeah, that's the last piece really, you know, because he
Speaker 6: talked about it in his speech, how that is at
Speaker 6: Jackson Hole where you know you're seeing some help a
Speaker 6: lot of other places, but wages yet still aren't there,
Speaker 6: and you know, maybe housing is picking back up again.
Speaker 6: It's it's it is a I thought about it this morning,
Speaker 6: and it seems as challenging as ever to figure out
Speaker 6: where we're at because you're at a point where then
Speaker 6: you also have to keep in mind, I mean, lately
Speaker 6: we've gotten economic data that's just accelerating, right, I mean
Speaker 6: you you probably have to pencil in three and a
Speaker 6: half percent real growth here for the third quarter, not
Speaker 6: that I don't think it's gonna come off from there,
Speaker 6: but still so you.
Speaker 2: Don't buy it what the Atlanta fet is predicting. It's
Speaker 2: a little bit more aggressive.
Speaker 6: Yeah, not quite that high, but because I think it
Speaker 6: come off, but still three and a half. I mean,
Speaker 6: how do you think inflations should slow down a lot
Speaker 6: when you're growing that fast?
Speaker 2: I was thinking about the conversation we had yesterday with
Speaker 2: Andy Brown and this whole concept that who'd have thunk
Speaker 2: that the US economy would be growing faster than the
Speaker 2: Chinese economy. That's pretty remarkable, yeah, terms of the metrics
Speaker 2: and things that are going on.
Speaker 6: Yeah, And I mean it just shows you, you know,
Speaker 6: again why everyone keeps looking at the at the job markets.
Speaker 6: As long as Americans have jobs, they like to spend,
Speaker 6: and as long as they spend, the economy keeps jugging along,
Speaker 6: you know, for all of our challenges. That's kind of
Speaker 6: the simple calculus of it.
Speaker 9: All.
Speaker 5: Right, Well, let's talk a little more about just what
Speaker 5: what August looked like. We thought for a while that
Speaker 5: it was kind to be going to be the doll
Speaker 5: drums of August, but looks like we're going to finish
Speaker 5: the month down on the S and P five hundred
Speaker 5: by only one point four percent, given that we were
Speaker 5: down last week by what negative five point five percent,
Speaker 5: that's pretty remarkable to see. In the short term, Where
Speaker 5: do you see the markets going well? I mean, you
Speaker 5: laugh like you know the answer.
Speaker 6: I don't know the answer, but I do think that
Speaker 6: the good news is that Bill.
Speaker 2: I don't know if you know about your chief investment
Speaker 2: officer at Glenday, your trust. I hope your bosses aren't listening.
Speaker 5: This is your job, quick, Bill, make something up.
Speaker 6: I forgot my magic coin that I flip.
Speaker 2: But this is what you do. You have you have
Speaker 2: to figure out right for your clients. So what is investment?
Speaker 2: What's actionable?
Speaker 5: Well?
Speaker 6: I mean I do think earnings have probably bottomed, so,
Speaker 6: you know, I think that is a positive for the
Speaker 6: stock side of the equation. You know, I'd probably lean
Speaker 6: a little bit more towards some of the less cyclical things.
Speaker 6: Some of the more stapleish kind of stuff that's been
Speaker 6: hasn't done nearly as well, you know, because you've got
Speaker 6: the AI stuff that's just been on fire.
Speaker 2: Do you know how many times we're gonna talk AI?
Speaker 2: I feel like today in terms of the convert.
Speaker 5: Even the sponsors are getting at AI, he us is
Speaker 5: getting at AI.
Speaker 6: I mean, it really has dominated the returns. Obviously, you
Speaker 6: know that it is there.
Speaker 5: There there.
Speaker 6: I think in the long run there is I just
Speaker 6: sit there and worry that, you know, you just like
Speaker 6: we saw it that I've been around long enough to
Speaker 6: been for the for the tech bubble, there wasn't there there, right,
Speaker 6: clearly the Internet it's a big deal, but it wasn't
Speaker 6: com Yeah, you're right, so you have to separate them out.
Speaker 6: But also things get overdone a lot of times, or
Speaker 6: speed video overdone. I will say we luckily owned it
Speaker 6: this year, just art the year. We've owned it for
Speaker 6: quite a while actually, so we're very happy. But we've
Speaker 6: trimmed it a bit because it's just tough it, you know.
Speaker 2: But you haven't sold out of it, No, we haven't.
Speaker 6: And I think part of the issue is you can
Speaker 6: make a good case if it continue to grow anywhere
Speaker 6: near that pace. Obviously it's not expensive, but that's a
Speaker 6: hard call. I mean, I've you know, I've listened to
Speaker 6: all the experts on it, and you know, I think
Speaker 6: I like.
Speaker 2: Holding some and they've actually been the numbers they are
Speaker 2: showing up in terms of their growth numbers, right and
Speaker 2: their outlooks.
Speaker 6: Yeah, I mean they're kind of the one firm I
Speaker 6: think that you can say has actually made money from
Speaker 6: AI so far. I mean everyone else kind of talks
Speaker 6: about it, but but there's not actually necessarily cash in
Speaker 6: the till from it yet.
Speaker 5: I think it'll come.
Speaker 2: Tim And I often say, you've got some new client
Speaker 2: comes to you institutional or a wealthy client and said,
Speaker 2: you know, here's a you know, we've got some money
Speaker 2: we want to put to work. How do you do
Speaker 2: it this environment, especially in an environment where you look
Speaker 2: at treasuries and I can put it there, make a
Speaker 2: decent healed and with not much risk. But what would
Speaker 2: you suggest? And I realize long term I get it,
Speaker 2: But what do you do?
Speaker 6: Yeah, I mean we own a lot of T bills
Speaker 6: at the moment, you know, and mixed with stocks, so
Speaker 6: we kind.
Speaker 2: Of two three, five, long term or shorter end on
Speaker 2: the stock the.
Speaker 6: Bills, Yeah, bills, a lot of bills. Because part of
Speaker 6: it is we think about it. We say, well, we
Speaker 6: generally have a good slog of stocks, so we think
Speaker 6: of those, you know, long duration assets we get paid.
Speaker 6: You know, we're okay holding some short duration assets on
Speaker 6: the other side. Plus, you know, you heard my kind
Speaker 6: of view that maybe inflation's a little stickier than they
Speaker 6: think it's going to be. So that's also tilted us
Speaker 6: towards staying towards the lower end of the duration, which
Speaker 6: has worked out really well. I mean it in terms
Speaker 6: of you know, relative.
Speaker 5: What about cash right now? Are you guys have a
Speaker 5: good portion and finds of a good portion in money
Speaker 5: market funds? You can get over five percent there too. Yeah.
Speaker 6: I mean it's i'd say the same thing, you know,
Speaker 6: T bills cash that's interchangeable essentially.
Speaker 5: Yeah, I mean what what percentage do you think is
Speaker 5: a typical account with you in terms of cash? I mean,
Speaker 5: is there I guess my question is is there still
Speaker 5: a lot on the sidelines?
Speaker 10: Yeah?
Speaker 6: I mean, i'd say our firm, there's generally a lot
Speaker 6: on the sidelines. But that's the normal for us because
Speaker 6: we're all ultra high networth high net worth primarily.
Speaker 5: So, Dave, we generally have a lot of catt.
Speaker 6: Thank you so much, Thank you, thanks for having me.
Speaker 2: Good to have you here. Go watch some more tun
Speaker 2: on Chief Investment officer.
Speaker 6: Just reminding me a great job with the weather.
Speaker 5: By the way, thank you.
Speaker 2: We we a BND you trust company. Of course, folks,
Speaker 2: we just have about ten minutes left in today's trading session.
Speaker 2: S and P five hundred just call it unchanged. The
Speaker 2: Dow just down about one hundred and ten. The NASDAK
Speaker 2: I gave him about sixty points. You are listening and
Speaker 2: watching Bloomberg Business Week Carol Master Long with Tim Steenevik
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