WEBVTT - Trump Losing His Twitter Megaphone Would Be A Big Blow: SocialFlow CEO 0:00:01.360 --> 0:00:04.120 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, along 0:00:04.120 --> 0:00:06.200 with my co host of Bonnie Quinn. Every business day 0:00:06.240 --> 0:00:10.360 we bring you interviews from ceo, market pros, and Bloomberg experts, 0:00:10.400 --> 0:00:13.600 along with essential market moving news. Find the Bloomberg Markets 0:00:13.600 --> 0:00:17.000 Podcast on Apple Podcasts or wherever you listen to podcasts, 0:00:17.000 --> 0:00:21.000 and on Bloomberg dot com. Well, yesterday was a busy 0:00:21.079 --> 0:00:22.680 day in Washington, to say the least, but it was 0:00:22.720 --> 0:00:27.120 also a busy day for social media platforms. Twitter suspended 0:00:27.160 --> 0:00:31.240 President Trump's Twitter feed for twelve hours, required deletion of 0:00:31.240 --> 0:00:35.120 the offending tweets, and then threatened a band. Facebook suspended 0:00:35.120 --> 0:00:37.600 the President's ability to post for twenty four hours, but 0:00:37.720 --> 0:00:39.839 said nothing about a permanent band. To get the latest 0:00:40.240 --> 0:00:43.760 on how the social media platforms are reacting to yesterday's news, 0:00:43.760 --> 0:00:47.040 we welcome to Jim Anderson, CEO of Social Flow. Jim, 0:00:47.080 --> 0:00:49.839 thanks so much for joining us here. So, you know, 0:00:49.880 --> 0:00:53.280 it's some pretty dramatic moves there by Facebook and Twitter. 0:00:53.320 --> 0:00:56.200 What do you make of it? Yeah, Paul, it is 0:00:56.280 --> 0:00:59.480 dramatic moves. I mean, in many ways we're unprecedented territory. 0:00:59.720 --> 0:01:02.800 I will say that a suspension is not yet a band. 0:01:02.960 --> 0:01:06.200 But there there's an air of inevitability to this that 0:01:06.240 --> 0:01:08.800 I haven't seen before, where you know, you've got a 0:01:08.840 --> 0:01:12.160 situation where the president was inciting violence. You know that 0:01:12.160 --> 0:01:14.280 that will be much discussed whether that was his intent 0:01:14.440 --> 0:01:16.800 or not, but certainly that was the outcome. And the 0:01:16.920 --> 0:01:20.400 social media platforms have always taken sort of refuge saying, hey, 0:01:20.440 --> 0:01:23.080 we we are not in a position to suppress the 0:01:23.200 --> 0:01:26.840 voice of a duly elected president. But now they you 0:01:26.880 --> 0:01:29.520 saw Twitter sort of move from one policy to another, 0:01:29.520 --> 0:01:31.840 say well, the threat of violence now has caused us 0:01:31.880 --> 0:01:33.480 to use this in a different light, and that's what 0:01:33.600 --> 0:01:36.480 led to the suspension. And so the real question in 0:01:36.520 --> 0:01:39.280 my mind is, you know, President Trump needs to sort 0:01:39.280 --> 0:01:41.600 of back down, and because Twitter said if you continue 0:01:41.640 --> 0:01:43.720 to do this, we may ban your account permanently. And 0:01:43.760 --> 0:01:45.759 when have we ever known President Sumps to back down 0:01:45.800 --> 0:01:50.160 from something? Yeah, I mean, is this something that is 0:01:50.200 --> 0:01:53.920 happening because he is the outgoing president at this point, 0:01:54.000 --> 0:01:58.360 so there is less at stake. Yeah, Bonny, without a doubt. 0:01:58.400 --> 0:02:01.360 I mean, he's got what thirteen twelve states left in office. 0:02:01.480 --> 0:02:04.400 And it's interesting, you know, outgoing presidents, or we'll call 0:02:04.440 --> 0:02:07.280 them former presidents traditionally in the United States have had 0:02:07.320 --> 0:02:10.320 sort of irrelevance. I mean, I don't mean that pejoratively. 0:02:10.520 --> 0:02:12.320 You know, that's sort of the nature. You retire, you 0:02:12.360 --> 0:02:16.119 become an elder statesman, You sort of after a while, 0:02:16.200 --> 0:02:18.560 write a book, you open a library, and that's about 0:02:18.639 --> 0:02:20.840 what you hear from former presidents. And I don't think 0:02:20.880 --> 0:02:23.880 anybody expects that from President Trump. You know, he's even 0:02:24.080 --> 0:02:26.519 you know, already teased the idea that he may run again. 0:02:26.600 --> 0:02:29.320 So he may be a former president and a future candidate, 0:02:29.639 --> 0:02:32.760 but once he is no longer president, and we're clearly 0:02:32.840 --> 0:02:35.280 coming up on the point where he is no longer president, 0:02:35.680 --> 0:02:37.760 you know, he's very clearly going to be treated with 0:02:37.800 --> 0:02:39.560 a different set of rules. And I think Twitter more 0:02:39.560 --> 0:02:42.080 specifically has been quite quite a bit more aggressive than 0:02:42.120 --> 0:02:44.880 Facebook and saying, look, we may just stand your entire account. 0:02:45.680 --> 0:02:48.160 So you know, I have a lot of folks on Twitter, 0:02:48.240 --> 0:02:51.440 on social media have been calling for Facebook and Twitter 0:02:51.840 --> 0:02:55.840 too permanently, been President Trump. And even Kara Swisher, one 0:02:55.880 --> 0:02:57.520 of the more of the New York Times, one of 0:02:57.520 --> 0:03:01.040 the more influential tech observers over the last couple of decades, 0:03:01.240 --> 0:03:06.080 has done the same here. What are the expectations post 0:03:06.280 --> 0:03:09.600 January twenty one or more of these social platforms might 0:03:09.680 --> 0:03:12.520 just in fact ben President Trump. Yeah, I think so. 0:03:12.680 --> 0:03:14.040 The first thing we need to do is we need 0:03:14.080 --> 0:03:16.880 to separate Twitter from Facebook. They are obviously two different companies. 0:03:16.919 --> 0:03:18.799 We tend to talk about them to theay what Twitter doing, 0:03:18.800 --> 0:03:21.560 What's Facebook doing? But but remember, you know, Facebook is 0:03:21.680 --> 0:03:23.960 you know, sort of twenty times larger or so than 0:03:24.000 --> 0:03:27.160 Twitter in terms of market cap. I just checked this morning. Um, 0:03:27.240 --> 0:03:29.399 and Facebook has got a lot more to fear from 0:03:29.400 --> 0:03:32.560 regulation and antitrust and those kinds of things than than 0:03:32.600 --> 0:03:35.640 Twitter does, just sort of simply from from the size 0:03:35.680 --> 0:03:38.720 and scale of their operation. You know, they're both private companies, 0:03:38.720 --> 0:03:40.360 and there's a case to be made that they can, 0:03:40.520 --> 0:03:42.880 you know, sort of choose to operate the platforms in 0:03:42.960 --> 0:03:45.760 whatever manner they see fit because it's private, you know, 0:03:45.760 --> 0:03:48.720 it's a private platform and private speech. Um, but I 0:03:48.720 --> 0:03:51.920 think Twitter is definitely being more aggressive. You know, President 0:03:51.920 --> 0:03:54.560 Trump has eighty nine million followers on Twitter. But to 0:03:54.640 --> 0:03:57.440 the degree he's ever had a social media superpower, it's 0:03:57.480 --> 0:04:00.400 not his ability to tweet. It's a need to get 0:04:00.400 --> 0:04:02.800 the media to cover what he tweets, and so if 0:04:02.800 --> 0:04:05.760 you take that megaphone away from him, which Twitter may 0:04:05.880 --> 0:04:08.400 very well do, um, he's going to have a really 0:04:08.600 --> 0:04:11.840 deep hill decline. Certainly, he's got many supporters. Seventy plus 0:04:11.880 --> 0:04:14.080 million people voted for him. It's not that he will 0:04:14.120 --> 0:04:17.120 become you know, irrelevant, but but you know, losing that 0:04:17.160 --> 0:04:20.640 Twitter megaphone would be a very significant load to him. 0:04:20.880 --> 0:04:23.600 Facebook similarly, he's got a large audience there, but he's 0:04:23.640 --> 0:04:26.200 not nearly as prolific on Facebook, and that doesn't seem 0:04:26.200 --> 0:04:28.120 to be able to drive the media narrative nearly as 0:04:28.200 --> 0:04:30.080 much as what he's tweeted has been able to do. 0:04:30.960 --> 0:04:35.279 What happens under a Biden presidency is Twitter as used? 0:04:35.800 --> 0:04:39.440 Do people still gather there too, you know, incite each 0:04:39.440 --> 0:04:43.159 other if you like. Well, the Twitter certainly will be used, 0:04:43.200 --> 0:04:47.880 and people do and probably still will incite on on 0:04:47.880 --> 0:04:49.920 on Twitter and do other things what you won't see 0:04:49.920 --> 0:04:53.040 as President Biden, of course tweeting like President front then, right, 0:04:53.040 --> 0:04:56.960 I mean it's just a completely different, uh personality. President 0:04:57.040 --> 0:05:00.640 He will be a user of social media, I'm quite certain, 0:05:01.160 --> 0:05:02.880 or at least his staff will, but but in a 0:05:03.000 --> 0:05:06.000 much less provocative way. Right, It's different kind of politicians. 0:05:06.000 --> 0:05:09.280 So I don't suspect that we will be having many 0:05:09.360 --> 0:05:12.919 conversations about what President Biden tweeted this morning like we 0:05:13.000 --> 0:05:16.080 have with President Trump. And so it's it's just it's 0:05:16.120 --> 0:05:18.600 sort of going to be a much more normal or 0:05:18.720 --> 0:05:21.440 traditional lot. I guess i'll call it view of the 0:05:21.480 --> 0:05:25.360 presidency and how they conduct, you know, briefings of the public. 0:05:26.680 --> 0:05:30.239 All right, Jim, thank you so much. Jim Anderson's always 0:05:30.240 --> 0:05:32.640 a pleasure to speak with you. Jim Anderson's CEO of 0:05:32.760 --> 0:05:36.360 a Social Flow and of course Bloomberg Media and other 0:05:36.400 --> 0:05:41.800 parts of Bloomberg works with Social Flow. That's just a disclaimer, Yeah, Paul, 0:05:41.880 --> 0:05:46.839 I mean I've been pretty you know, ignorant of Twitter 0:05:46.920 --> 0:05:48.839 over the last few days. I haven't really wanted to 0:05:48.839 --> 0:05:50.520 see the back and forth. I mean some of them 0:05:50.520 --> 0:05:54.080 are pretty graphic and and pretty nasty. Yeah, it really was. 0:05:54.120 --> 0:05:56.839 And there is a call for regulation, but you bounce 0:05:56.880 --> 0:06:00.120 that against the censorship issues, uh, And that's kind d 0:06:00.160 --> 0:06:02.120 of the challenge out there in the marketplace and for 0:06:02.160 --> 0:06:06.560 the regulators as well. Well. This week, among other things, 0:06:06.560 --> 0:06:10.680 we had Impossible Foods deciding to cut the prices on 0:06:10.880 --> 0:06:14.960 their foe meat or fake meat products by fift percent. 0:06:15.400 --> 0:06:19.279 Of course, so Impossible makes burger is essentially from a 0:06:19.320 --> 0:06:23.279 magic ingredient that is essentially modified yeast. Time to bring 0:06:23.320 --> 0:06:26.320 in Dennis Woodside, president of Impossible Foods, and Dennis, thank 0:06:26.360 --> 0:06:28.080 you so much for joining. It's been a busy day. 0:06:28.120 --> 0:06:31.320 I know that we just had news breaking that you 0:06:31.360 --> 0:06:36.120 now have an interim CFO as your previous gentleman went 0:06:36.279 --> 0:06:38.760 to app Harvest to head up a harvests. So I'm 0:06:38.760 --> 0:06:40.760 sure it's been a very busy few days for you. 0:06:40.839 --> 0:06:43.800 But talk to us about why you decided to reduce 0:06:43.839 --> 0:06:46.160 the price of your products by fiftcent at a time 0:06:46.160 --> 0:06:50.080 when it must be difficult to do that. Yeah, thanks 0:06:50.080 --> 0:06:52.680 for having me. So the price reduction is part of 0:06:52.680 --> 0:06:57.279 an ongoing strategy to get down ultimately to the price 0:06:57.400 --> 0:07:02.160 of of ground beef. So you have you have at 0:07:02.160 --> 0:07:05.039 the very high end products like wandboo beef and like 0:07:05.120 --> 0:07:08.560 nine bucks a pound. We're currently priced with this reduction, 0:07:08.680 --> 0:07:11.160 closer to what you would pay for grass fed. But 0:07:11.240 --> 0:07:13.880 ultimately we need to compete with the mass of the market, 0:07:13.920 --> 0:07:17.400 which is which is buying what's called ground beef, and 0:07:17.480 --> 0:07:20.080 that's even lower than where we are now. Uh, so 0:07:20.320 --> 0:07:23.560 you you should expect continuing price reductions from us over 0:07:23.640 --> 0:07:25.880 time as we get scale, and we can pass the 0:07:25.880 --> 0:07:29.360 benefits of that that scale onto our restaurant partners and 0:07:29.480 --> 0:07:33.920 onto consumers ultimately. Uh, Dennis, what's the elasticity there on 0:07:34.120 --> 0:07:36.360 the price cuts for you? It seems in this market 0:07:36.400 --> 0:07:40.560 that you've had pretty strong unit sales, perhaps strong enough 0:07:40.600 --> 0:07:42.200 that you don't need to cut prices. Give us a 0:07:42.200 --> 0:07:46.000 sense of how that dynamiccause working for you, guys. Yeah, yeah, 0:07:46.040 --> 0:07:49.080 you know the market isn't The elasticity is incredibly high. 0:07:49.160 --> 0:07:54.680 The vast, vast majority of of consumers purchase beef in 0:07:54.760 --> 0:07:57.840 the three to six dollar range, and we're we're just 0:07:57.920 --> 0:08:01.600 outside that now. Uh. We expect, as I said, to 0:08:01.640 --> 0:08:03.800 get down there over time as we continue to scale 0:08:03.800 --> 0:08:07.960 our production. Uh. If you think about the economies of scale, 0:08:08.080 --> 0:08:10.920 you know, you you build a plan or you stand 0:08:10.960 --> 0:08:14.040 up a supply chain. The more you put through that plant, 0:08:14.080 --> 0:08:16.120 the more lines you can run, the more ships you 0:08:16.120 --> 0:08:18.600 can run. Uh. You know, your fixed costs are just 0:08:18.680 --> 0:08:22.360 amortized over over a larger revenue base. And and so 0:08:22.400 --> 0:08:25.440 we've been able to as our as our productionist scale, 0:08:25.440 --> 0:08:28.040 as our volume scale, We've been able to get those 0:08:28.040 --> 0:08:30.800 economies over the last year. But we don't see that stopping. 0:08:30.840 --> 0:08:33.880 We just see our footwork continue to continue to expand 0:08:34.600 --> 0:08:38.800 and continue to pass that benefit onto onto our partners 0:08:38.800 --> 0:08:41.719 and consumers. Now, you said just at the end of 0:08:41.800 --> 0:08:43.400 last year that you're going to be doubling your R 0:08:43.440 --> 0:08:45.959 and D team over the next twelve months. Important to 0:08:46.000 --> 0:08:48.439 get into the Chinese market as well, to grow your 0:08:48.480 --> 0:08:51.360 base and also keep competitors at bay, like beyond meat 0:08:51.480 --> 0:08:55.000 and you know meat makers and other countries in the world. 0:08:55.240 --> 0:08:58.440 You've also had seven fundraising rounds. Where are you in 0:08:58.520 --> 0:09:03.800 terms of capital needs? We're we're actually quite quite good 0:09:03.880 --> 0:09:07.520 right now. We raised a couple hundred million uh in 0:09:07.520 --> 0:09:11.120 in May time frame, and then several million prior to 0:09:11.160 --> 0:09:14.320 that um. But look, you know, the market that we're 0:09:14.320 --> 0:09:16.959 going after is enormous. Our our mission is to replace 0:09:17.480 --> 0:09:20.840 all animal based protein products and that is a literally 0:09:20.960 --> 0:09:25.800 a one trillion pound market roughly four to over four 0:09:25.920 --> 0:09:29.320 trillion dollars globally, and and we're competing now in a 0:09:29.400 --> 0:09:31.960 relatively small part of it, which is primarily ground beef. 0:09:32.000 --> 0:09:35.680 We have a sausage product as well, but primarily ground beef. 0:09:35.720 --> 0:09:39.240 But we see opportunity in many other meat products. Um 0:09:39.320 --> 0:09:42.160 and you know it's not it's not a surprise that uh, 0:09:42.280 --> 0:09:46.040 ground steak, chicken, fish, all these are interesting to us 0:09:46.040 --> 0:09:49.880 over time. For us to be competitive in those those markets, 0:09:49.920 --> 0:09:52.440 we need to invest in R and D and create 0:09:52.480 --> 0:09:55.000 the same kind of wow product that we did when 0:09:55.080 --> 0:09:58.280 we launched The Impossible Burgher. Dennis talked to us about 0:09:58.320 --> 0:10:02.520 kind of your distribution directed tumor versus restaurants. Where are 0:10:02.520 --> 0:10:04.600 you now? You know, where do you want to be? 0:10:04.760 --> 0:10:07.000 Where's the real growth? Talk us about, you know, kind 0:10:07.000 --> 0:10:11.440 of your revenue story. Yeah, we're in over thirty thousand 0:10:11.920 --> 0:10:15.840 restaurants in the US. We're in over seventeen thousand retail 0:10:15.880 --> 0:10:18.360 doors and and that's up from like two hundred a 0:10:18.440 --> 0:10:20.640 year ago. So we made a big move into retail 0:10:20.679 --> 0:10:22.600 over the last year. But at the same time, we 0:10:22.600 --> 0:10:25.120 have a limited products that we have to retail products 0:10:25.160 --> 0:10:27.920 now most if you if you look at beef products, 0:10:28.240 --> 0:10:31.120 you know, anybody's selling beefs to to a to a 0:10:31.160 --> 0:10:34.480 retailer probably has ten to fifteen different skews. And we're 0:10:34.480 --> 0:10:37.880 in the process of building a much broader portfolio to 0:10:37.920 --> 0:10:40.800 go to to expand that retail presence. So it's still 0:10:41.120 --> 0:10:43.800 even though we're we've we've got good presences, still pretty 0:10:43.840 --> 0:10:47.600 early days. There's well over three thousand restaurants in the US, 0:10:48.000 --> 0:10:49.679 and that's just the U S which is less than 0:10:49.720 --> 0:10:53.040 fiftent of all beef consumption. So it's very early days 0:10:53.080 --> 0:10:55.559 for the industry. You know, most of our consumers are 0:10:55.600 --> 0:10:59.480 are the vast majority, like of them are uh meat eaters. 0:10:59.760 --> 0:11:03.360 Uh and and they're shifting a small portion today of 0:11:03.440 --> 0:11:08.760 their meat um meat meat eating into plant based Over time, 0:11:08.800 --> 0:11:10.920 that share is just going to grow and grow as 0:11:10.920 --> 0:11:13.679 they see the benefits, the health benefits as well as 0:11:14.040 --> 0:11:16.640 the environmental benefits of moving to a plant more of 0:11:16.679 --> 0:11:20.120 a plant based meat UH diet Dennis and announcing this 0:11:20.360 --> 0:11:24.520 price reduction, Yours Books person said that now the lowest 0:11:24.520 --> 0:11:26.760 price for your burger product is six dollars and eight 0:11:26.880 --> 0:11:29.680 cents per pound. How much of that is pure profit 0:11:29.720 --> 0:11:35.120 and much of what people are buying is basically, you know, 0:11:35.800 --> 0:11:41.280 helped by private equity funding. Uh So the economic unit 0:11:41.320 --> 0:11:44.720 economics of the business are quite good actually, and it's 0:11:44.720 --> 0:11:46.440 not the kind of the case where this is you know, 0:11:46.440 --> 0:11:49.120 we're selling at a loss. Um and like I said, 0:11:49.240 --> 0:11:53.000 at the the the growth of the business has has 0:11:53.080 --> 0:11:56.320 enabled us to get the scale uh in order to 0:11:56.520 --> 0:11:59.600 in order to sell product at a at a reasonable margin, 0:11:59.760 --> 0:12:01.760 but also reduced our prices. And you think about the 0:12:02.200 --> 0:12:04.240 you know, the inputs that we we have to the 0:12:04.280 --> 0:12:08.600 product are our plants, and those plants are much lower 0:12:08.640 --> 0:12:12.520 cost than than the animal because you don't have the 0:12:13.160 --> 0:12:16.600 all of the um labor that goes into rating cows, 0:12:16.600 --> 0:12:18.440 you don't have the transportation and so forth. So the 0:12:18.559 --> 0:12:21.920 unit economics are actually quite good, especially as you start 0:12:21.960 --> 0:12:23.959 to get the scale. Hey, Dennis, thanks so much for 0:12:24.000 --> 0:12:27.600 joining us. Really appreciate the update. Dennis Woodside, president of 0:12:27.760 --> 0:12:33.200 Impossible Foods, based in Menlo Park, California, continuing to grow 0:12:33.240 --> 0:12:39.280 that plant based food business. Well, there are many questions 0:12:39.320 --> 0:12:41.600 that will need to be answered about what occurred in Washington, 0:12:41.679 --> 0:12:46.480 d C. Yesterday. Chief among them is security or lack 0:12:46.600 --> 0:12:50.080 thereof that allowed the whole event to take place to 0:12:50.200 --> 0:12:52.200 the scale at which it did, and we can maybe 0:12:52.200 --> 0:12:54.199 begin to start answering some of the asking some of 0:12:54.240 --> 0:12:57.040 those questions right now at Jordan Strauss, Managing director of 0:12:57.080 --> 0:13:00.439 Business Intelligence and Operations for Cruell, which is a vision 0:13:00.480 --> 0:13:03.400 of Duff and Phelps based in Philadelphia, Jordan. Thanks so 0:13:03.480 --> 0:13:06.640 much for joining us here. The images we saw of 0:13:07.679 --> 0:13:10.280 the inability of the Capitol Police and the and the 0:13:10.400 --> 0:13:14.080 d C Police UH to secure the Capital grounds, and 0:13:14.080 --> 0:13:16.160 in fact it seemed at times some of the videos 0:13:16.200 --> 0:13:18.880 suggest that they were letting them in and not even 0:13:18.920 --> 0:13:22.760 trying to stop the folks that were coming into the Capitol. 0:13:23.120 --> 0:13:25.840 What do you make of all that? Thanks Paul and 0:13:26.040 --> 0:13:28.200 happy to be here. Look what we saw yesterday was 0:13:28.240 --> 0:13:31.679 one of the darkest days in American history. This was predictable, 0:13:31.800 --> 0:13:34.520 it was preventable, and it represents an almost total lack 0:13:34.640 --> 0:13:38.160 of preparation. We should expect to see investigations about this 0:13:38.600 --> 0:13:43.120 for probably generations to come, and changes in the near future. 0:13:43.160 --> 0:13:44.800 I will tell you talking to our clients all over 0:13:44.840 --> 0:13:47.839 the world about contingency planning in the last twenty four hours. 0:13:47.920 --> 0:13:49.800 The big takeaway here is that there just didn't seem 0:13:49.800 --> 0:13:52.439 to be any well what it's changed. Who's protecting the 0:13:52.480 --> 0:13:58.640 capital today? So, Nnie, the Capitol Police are a very small, 0:13:58.679 --> 0:14:01.680 but very elite unit that's a little bit unusual in 0:14:01.679 --> 0:14:04.760 the American law enforcement inventory. Like the Supreme Court Police. 0:14:04.800 --> 0:14:07.760 They're one of the only two law enforcement organizations that 0:14:07.840 --> 0:14:10.720 don't that aren't part of the executive branch. They work 0:14:10.840 --> 0:14:14.160 for the Congress. So in order to get extra help, 0:14:14.280 --> 0:14:17.719 in order to plus up, they need to get additional 0:14:17.760 --> 0:14:22.440 resources from executive branch agencies. So another branch of the government. Similarly, 0:14:22.520 --> 0:14:26.000 the Metropolitan Police Department in Washington doesn't really have jurisdiction 0:14:26.000 --> 0:14:27.840 on the capital grounds because it's it's part of the 0:14:27.880 --> 0:14:32.760 federal the federal sovereign. So what's so frustrating about this? 0:14:33.160 --> 0:14:35.360 And this was work I used to do along with 0:14:35.520 --> 0:14:39.480 many many others in government that we do now for clients. 0:14:40.000 --> 0:14:42.920 You know, the capital is a space that's very easy 0:14:43.000 --> 0:14:45.480 to protect in the sense that we do it at 0:14:45.560 --> 0:14:47.720 least every year for the State of the Union. And 0:14:47.760 --> 0:14:51.680 there are these very complex, very well thought out plans 0:14:51.720 --> 0:14:54.240 that the Federal Interagency puts together towards things that are 0:14:54.240 --> 0:14:57.720 called national Security Special Events and s s s the 0:14:57.800 --> 0:15:01.240 highest tier of of of the stick security events, so 0:15:01.320 --> 0:15:04.720 things like the UN General Assembly, a presidential inauguration, the 0:15:04.760 --> 0:15:07.880 State of the Union, sometimes the Super Bowl. Right, there's 0:15:07.920 --> 0:15:11.240 a plan on the book that gets revisited every time 0:15:11.240 --> 0:15:13.280 there's a new one. And I know that there's been 0:15:13.320 --> 0:15:16.520 expensive planning going on for President of like Biden's inauguration 0:15:16.600 --> 0:15:18.760 for at least the last couple of weeks. This is 0:15:18.800 --> 0:15:21.760 something we should be good at, we should be well 0:15:21.760 --> 0:15:24.720 practiced at, and we should be able to do in layers. 0:15:24.920 --> 0:15:28.440 And given the threat environment that existed, the known threat 0:15:28.520 --> 0:15:32.320 environment that existed going into yesterday, the fact that that 0:15:32.480 --> 0:15:34.760 didn't happen is just beyond a belief. Jordan, Can I 0:15:34.800 --> 0:15:38.280 just jump in and ask who gives that command? Because 0:15:38.360 --> 0:15:40.200 right now we just learned the Chad Wolf is no 0:15:40.280 --> 0:15:42.640 longer in position. He has resigned. He was the acting 0:15:42.880 --> 0:15:47.160 Homeland Security director. Who who gives the orders and who 0:15:47.320 --> 0:15:50.280 who will do it now in his absence? Sure, Vonny, 0:15:50.320 --> 0:15:53.200 that that's a great question. So for things like national 0:15:53.240 --> 0:15:56.400 security special events, which this was not, the Department of 0:15:56.400 --> 0:15:59.760 Homeland Security through the Secret Service, is the lead coordinating agency. 0:16:00.320 --> 0:16:04.160 So you know, for a planned, coordinated deployment of people, 0:16:04.360 --> 0:16:06.640 like for the inauguration, it's usually going to be the 0:16:06.680 --> 0:16:09.480 Secret Service coordinating a lot of local law enforcement in 0:16:09.480 --> 0:16:13.120 the district Maryland, Virginia area, uh, and the entire sort 0:16:13.120 --> 0:16:16.560 of arsenal a federal law enforcement I understand that the 0:16:16.640 --> 0:16:19.800 FBI and the hostage rescue team got there relatively quickly 0:16:20.200 --> 0:16:23.520 that the Metropolitan Police Department around the perimeters of the 0:16:23.520 --> 0:16:25.320 capital is able to use what's called an iMac and 0:16:25.400 --> 0:16:29.680 Emergency Management Assistance Compact to get two hundred troops from Virginia. 0:16:29.760 --> 0:16:32.360 As to who does this now, there has to be 0:16:32.840 --> 0:16:36.560 a cognisant official, be it the Attorney General, the FBI director, 0:16:36.960 --> 0:16:39.640 the Secret Service director, or others that agrees to send 0:16:40.000 --> 0:16:42.800 their people in, or a National Guard deployment, which, although 0:16:42.800 --> 0:16:45.000 it was delayed for reasons which I suspect, will be 0:16:45.000 --> 0:16:48.160 investigated and will become clear uh in the coming weeks. 0:16:48.720 --> 0:16:52.720 UM work closely with again the very elite but clearly 0:16:52.840 --> 0:16:56.080 overmatched and overwhelmed officer and Capital police in a situation 0:16:56.120 --> 0:16:58.480 like this, Jordan, what do you say to the argument 0:16:58.520 --> 0:17:04.160 that perhaps a the less forceful defense of the Capitol 0:17:04.240 --> 0:17:08.600 yesterday resulted in relatively fewer casualties than there might have 0:17:08.760 --> 0:17:11.240 been had they taken a much stronger stance than in 0:17:11.359 --> 0:17:14.520 fact it was. You know, I think there are four fatalities, 0:17:14.520 --> 0:17:16.040 but it could have been so much worse. Is that 0:17:16.080 --> 0:17:20.560 a reasonable argument to make? I don't understand why the 0:17:20.600 --> 0:17:23.640 capital was not locked down? Uh? You know, a forceful 0:17:23.720 --> 0:17:27.320 response doesn't have to look like shooting people. It doesn't 0:17:27.359 --> 0:17:29.760 have to look like mass arrests. If you think about 0:17:29.760 --> 0:17:31.560 these sorts of things in advance, it might look like 0:17:32.119 --> 0:17:35.280 just making sure that the Capitol building is well secured, 0:17:35.400 --> 0:17:37.159 and it should be well secured, because there were a 0:17:37.240 --> 0:17:39.960 ton of upgrades after the September eleventh attacks, after the 0:17:39.960 --> 0:17:43.760 first Capitol Hill shooting, uh, and after the tragic shooting 0:17:43.880 --> 0:17:47.600 representatives police at a softball game making it harder to 0:17:47.640 --> 0:17:51.480 penetrate and then pushing layers of security out. It's not 0:17:51.560 --> 0:17:54.760 clear why those layers of security failed and why they 0:17:54.760 --> 0:17:58.959 weren't stop leading into the capital. Yeah. I mean, we're 0:17:58.960 --> 0:18:00.800 gonna have to fill some of these open positions, or 0:18:00.800 --> 0:18:04.399 at least designate somebody to take on their responsibilities for 0:18:04.440 --> 0:18:07.000 the next two weeks. Jordan's thank you so much for 0:18:07.000 --> 0:18:10.000 giving us those explanations. It is very important to understand 0:18:10.040 --> 0:18:12.720 the ins and outs of what actually happens. Jordan, of course, 0:18:13.880 --> 0:18:16.720 managing director at a crull, former White House and a 0:18:16.800 --> 0:18:19.000 Sea official and director of Preparedness in response for the 0:18:19.040 --> 0:18:21.359 National Security Division of the U s d O j 0:18:21.720 --> 0:18:24.600 and Jordan's strouss in Philly which also is you know, 0:18:24.880 --> 0:18:27.879 very very divided right now Philadelphia, Pennsylvania, I should say, 0:18:27.920 --> 0:18:32.080 with the final hurdle in counting electoral College votes last evening, 0:18:32.600 --> 0:18:34.960 I do want to mention as well that the incoming 0:18:35.400 --> 0:18:38.000 majority leader, Chuck Schumer has now called for the removal 0:18:38.160 --> 0:18:43.639 of President Trump. Well, it is time to look cross 0:18:43.680 --> 0:18:46.560 asset because as the NASTAG rises above at two percent, 0:18:46.640 --> 0:18:49.120 we also have the tenure yield almost at one point 0:18:49.200 --> 0:18:52.119 zero eight percent, we have a muted VIX and a 0:18:52.160 --> 0:18:54.760 Donar index that's again approaching in ninety. It is time 0:18:54.760 --> 0:18:58.520 to bring in Sarah Ponzac Crocess, that reporter here at Bloomberg. Sarah, 0:18:58.560 --> 0:19:01.119 what catches your eye most day as an expression of 0:19:01.119 --> 0:19:03.919 what's been happening in the country overnight, Well, it really 0:19:04.119 --> 0:19:07.840 is remarkable, and it feels like you're in two different worlds. 0:19:08.040 --> 0:19:11.320 Yesterday with the images of what we were seeing on 0:19:11.400 --> 0:19:14.080 Capitol Hill, and then you look at what was happening 0:19:14.080 --> 0:19:16.399 in markets before four pm, and yes, we saw some 0:19:16.440 --> 0:19:20.000 pairing of gains in equity markets, but nothing too remarkable. 0:19:20.160 --> 0:19:22.080 We didn't even see a loss of more than one 0:19:22.119 --> 0:19:25.479 percent in to day. And it can seem cold, and 0:19:25.560 --> 0:19:27.840 this is also almost an extension of what we've been 0:19:27.880 --> 0:19:31.160 talking about for almost a year now with the real 0:19:31.200 --> 0:19:35.199 economy with COVID nineteen and the stark differential when it 0:19:35.240 --> 0:19:39.080 comes to financial markets. But when you speak with investors 0:19:39.119 --> 0:19:42.440 on why we see this disconnect, why we're not seeing 0:19:43.600 --> 0:19:48.040 these images really affecting investors moods is Peter Bookvar, he's 0:19:48.040 --> 0:19:50.280 over ablicely advisory. I'll read you what he said this morning, 0:19:50.280 --> 0:19:52.840 and he said it very plainly. He said, there should 0:19:52.840 --> 0:19:54.960 be no mystery as to why the markets didn't care 0:19:54.960 --> 0:19:58.600 about what happened in the capitol yesterday. However disturbing, disgraceful, 0:19:58.600 --> 0:20:00.639 and embarrassing it was. It's because it is no bearing 0:20:00.680 --> 0:20:03.359 on the direction of the economy, earnings, an in trace 0:20:03.600 --> 0:20:05.840 interest rates. It's that simple. And like you mentioned, you 0:20:05.840 --> 0:20:09.240 look at the tenure this morning, just continuing it's climb higher. 0:20:09.359 --> 0:20:12.240 The tenure yield this morning is still up another more 0:20:12.240 --> 0:20:15.760 than four basis points. Yeah, we're seeing the yield curve steping. 0:20:15.760 --> 0:20:17.960 Easy point out, Sarah, and that's caused a couple of 0:20:17.960 --> 0:20:22.040 strategists want a Glomo Sax and dud and Um Jonathan 0:20:22.040 --> 0:20:26.119 Golubt credit Swiss to kind of upgrade their view of 0:20:26.280 --> 0:20:30.120 the big banks right, and Jonathan Golove's view. He also 0:20:30.240 --> 0:20:32.720 upgraded his view and his year in target for the 0:20:32.840 --> 0:20:36.080 SMP five hundred from forty two hundred. And it was 0:20:36.119 --> 0:20:39.000 an interesting take because he has been talking about how 0:20:39.040 --> 0:20:43.560 this rotation from growth to value was possibly over. That 0:20:43.640 --> 0:20:46.439 we had seen value out performance on a couple of 0:20:46.480 --> 0:20:49.000 solid days, that those being the days in which we 0:20:49.119 --> 0:20:52.240 got positive vaccine news when Janet Yellen was nominated to 0:20:52.280 --> 0:20:56.879 be Treasury secretary. Whoever, today he's overweighting cyclical assets. Like 0:20:56.920 --> 0:21:00.040 you mentioned, we see financials flying higher yet again and 0:21:00.160 --> 0:21:03.000 today up more than two percent. But we do see 0:21:03.040 --> 0:21:06.879 this interesting change today because you don't see this clear 0:21:06.960 --> 0:21:11.879 cut cyclical defensive tilt. Yes, we do see defensive equities 0:21:12.160 --> 0:21:15.120 under performing utilities pretty much flat on the day's staples, 0:21:15.119 --> 0:21:18.520 your second worst performing sector, however, still higher at the 0:21:18.560 --> 0:21:20.880 top of the pack, though you have tech and consumer 0:21:20.920 --> 0:21:24.560