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Speaker 2: This is Bloomberg BusinessWeek inside from the reporters and editors
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Speaker 1: Hi, everyone, Welcome to the Bloomberg Business Week Weekend podcast.
Speaker 1: Top of Mind. This week, former President Donald Trump was
Speaker 1: convicted on all thirty four counts in his New York
Speaker 1: hush money trial, a landmark jury verdict, making him the
Speaker 1: first former American president to be found guilty of felony crimes.
Speaker 1: His sentencing now set for July eleventh. All the details
Speaker 1: can be found on Bloomberg dot com and of course,
Speaker 1: on the Bloomberg terminal.
Speaker 3: Our focus is on presidential candidate Donald Trump, now that
Speaker 3: we are about five months away from the November US election,
Speaker 3: and on the concerns of some voters about Trump forever.
Speaker 3: We'll explain what that means in a moment.
Speaker 1: Plus, Jamie diamond says there could be held to pay
Speaker 1: if one all asset class sours. We talk private credit
Speaker 1: with the folks over at Moody's.
Speaker 3: And how money and markets really work in this economy.
Speaker 3: That's the title of a new book by financial educator
Speaker 3: commentator in Bloomberg Opinion contributor Kylas Scanlon. Now, if her
Speaker 3: name sounds familiar, it's because she coined the word and
Speaker 3: the whole concept of the vibe session.
Speaker 1: Yeah, great conversation coming up there. All of that to come.
Speaker 1: We begin with the November presidential race. As a rematch
Speaker 1: between Joe Biden and Donald Trump draws closer, political professionals
Speaker 1: are detecting an unusual concern for some undecided voters, the
Speaker 1: fears of not just four more years of Donald Trump,
Speaker 1: but Trump forever.
Speaker 3: And as far fetched as it may sound, the prospect
Speaker 3: of Donald Trump, should he find himself back in the
Speaker 3: Oval office and then never leaving, is weighing big time
Speaker 3: on the minds of some voters, so writes our Bloomberg
Speaker 3: BusinessWeek national correspondent Josh Green. His story featured in the
Speaker 3: latest edition of BusinessWeek Magazine, out on newstands now, on
Speaker 3: the Bloomberg Term and at Bloomberg dot com slash BusinessWeek.
Speaker 1: Josh is also the author of The Rebels Elizabeth Warren,
Speaker 1: Bernie Sanders, AOC and The Rise of the New Left,
Speaker 1: also author of Devil's Bargain, Steve Bannon, Donald Trump and
Speaker 1: the Storming of the Presidency.
Speaker 3: We spoke to Josh before the Trump verdict.
Speaker 4: I've been talking to a Republican and Democratic strategist recently
Speaker 4: who'd mentioned that they were seeing something strange in the
Speaker 4: focus groups and polls they were conducting, and that is
Speaker 4: that a lot of swing voters were worried that Trump
Speaker 4: was going to declare himself president for life if he's
Speaker 4: reelected in November. And as I did some reporting on
Speaker 4: the source of these worries, basically this is something that
Speaker 4: Trump likes to joke about. Of course, there was the
Speaker 4: January sixth riots that gave a lot of people pause.
Speaker 4: But it's a factor that I think isn't being paid
Speaker 4: a lot of attention to. But both Republican and Democratic
Speaker 4: strategists are seeing it and wondering if this is going
Speaker 4: to have an effect on the outcome in November.
Speaker 1: You know, it's interesting, and Josh, we don't certainly have
Speaker 1: to tell you, but this idea that Donald Trump will
Speaker 1: say something and people be like, well that's Donald Trump,
Speaker 1: you know what I mean, they're kind of dismissive. Is
Speaker 1: there something though different as he runs for a second
Speaker 1: go at the White House.
Speaker 3: Yeah, I think there are a couple of things.
Speaker 4: I mean, as you mentioned, the Trump people sort of
Speaker 4: laugh this off as this is just Trump being Trump.
Speaker 4: You know, he likes to say outrageous things to get
Speaker 4: a rise out of liberals. He's talked a little bit
Speaker 4: about well should I maybe serve three terms? But while
Speaker 4: a lot of people write it off as just Trump
Speaker 4: being Trump, this particular group of voters seems to be
Speaker 4: listening to it and worrying about it. And as strategists
Speaker 4: have kind of plumbed the reason for this, they've come
Speaker 4: up with some interesting theories, and the best one I
Speaker 4: heard was that it was really what was driving the
Speaker 4: sphere was the Supreme Court's decision to overturn Roe versus Wade.
Speaker 4: A Democratic strategist told me that what that did was
Speaker 4: convince a lot of ordinary voters that things they wouldn't
Speaker 4: have imagined possible, like Rovers' way being overturned or Trump
Speaker 4: abolishing term limit suddenly seemed real enough that these voters
Speaker 4: were worrying about it, and it seemed to be pushing
Speaker 4: at least some of them back into Joe Biden's camp.
Speaker 3: Well, you get into the piece that the idea of
Speaker 3: president serving only two terms, whether consecutive or not, hasn't
Speaker 3: been in the Constitution since the days of the Founding
Speaker 3: Fathers by any means. It was ratified in the nineteen
Speaker 3: fifties after FDR served more than two terms. Can you
Speaker 3: talk a little bit about the history of presidents since
Speaker 3: nineteen fifty talking about the potential repealed the twenty second
Speaker 3: Amendment or at least alluding to the idea of serving
Speaker 3: more than two terms.
Speaker 5: Yeah.
Speaker 4: Absolutely, I mean, as I did a kind of a
Speaker 4: deep dive in this piece, what was interesting was almost
Speaker 4: immediately when the twenty second after the twenty second Amendment
Speaker 4: was passed, popular presidents and their advisors in both parties
Speaker 4: have kind of objected to it. Ronald Reagan said in
Speaker 4: nineteen eighty seven he would like to overturn it. Democrats
Speaker 4: in the House of Representatives twice, once during Bill Clinton's
Speaker 4: presidency once during Barack Obama's tried to push legislation overturning it.
Speaker 4: So it's something that popular presidents sort of chafe at.
Speaker 4: But that being said, that the hurdle to actually get
Speaker 4: it overturned in abolished urn onm It's is almost unthinkably difficult.
Speaker 4: It would require large majorities in both houses of Congress,
Speaker 4: that would require large majorities of state legislatures to approve it.
Speaker 4: So it's not something that's plausibly going to happen. And
Speaker 4: yet still people have learned that Trump is a norm breaker.
Speaker 4: It's something that gives them pause and it's weighing on
Speaker 4: them as they make their decision on who to vote
Speaker 4: for in November.
Speaker 1: Hey, Josh, there are focus groups, and then there are
Speaker 1: focus groups by those who have been doing them for
Speaker 1: some time that maybe you sit up a little bit
Speaker 1: straight and take note, like I just do. Wonder is
Speaker 1: there something that just makes everybody kind of be like,
Speaker 1: wait a minute, there's something different this time around.
Speaker 4: Yeah, I think that's exactly what's going on. I mean,
Speaker 4: if you go back to twenty twenty and the January
Speaker 4: sixth uprising, it's sort of shaken a lot of people
Speaker 4: and made them realize that, well, maybe things aren't as
Speaker 4: smooth as we expect. Historically, when we conduct these focus
Speaker 4: groups and we throw out these kind of wild scenarios,
Speaker 4: voters usually push back and say, oh, that could never happen.
Speaker 4: I was able to sit in on a couple of
Speaker 4: these and sort of see this myself, and people are
Speaker 4: just much more willing to believe that crazy things can happen,
Speaker 4: and that maybe one of those crazy things will be
Speaker 4: Trump declaring himself president for life. As implausible as that sounds,
Speaker 4: I think to most voters.
Speaker 3: Well, it was struck by a woman who you spoke
Speaker 3: to who actually said that she would vote for Biden
Speaker 3: even if he is in a coma, despite the fact
Speaker 3: that back in twenty sixteen she voted for former President
Speaker 3: Trump during that election. Talk to me a little bit
Speaker 3: about her thinking, Josh, and how this could move the
Speaker 3: needle with the undecided voters.
Speaker 4: Yeah, Well, the people I was focusing on in this
Speaker 4: piece really were that narrow group of undecided voters who
Speaker 4: are going to decide the election. A lot of committed
Speaker 4: Republicans like it when Trump talks about abolishing term limits.
Speaker 4: A lot of Democrats like to get upset about it,
Speaker 4: but their votes aren't really up for grabs on either side.
Speaker 4: So the focus of these focus groups and the voters
Speaker 4: that I talked to were people who had either been
Speaker 4: former Trump voters former Biden voters, were now undecided.
Speaker 3: The woman.
Speaker 4: You mentioned, Laura McCammon as a grandmother in Wisconsin I
Speaker 4: talked to voted for Trump in twenty sixteen, but as
Speaker 4: she's witnessed January sixth, she's listened to, you know, maga
Speaker 4: media figures like Steve Bannon talk about multiple terms. It
Speaker 4: scared her into deciding that she wouldn't risk another vote
Speaker 4: for Donald Trump. And she told me, as you said,
Speaker 4: she's planning to vote for Biden in November no matter what.
Speaker 1: Hey, you know, while we have you, and one thing
Speaker 1: we wanted to ask you, and this was certainly a
Speaker 1: story that we've been talking about this week a lot,
Speaker 1: and this has to do with Donald Trump. A video
Speaker 1: posted to his social media account, the report Yeah to
Speaker 1: his that referenced a unified Reich as a potential news
Speaker 1: headline if you won a second term. You know, Devil's
Speaker 1: Bargain bestseller. You know, you really got inside Steve Bannon
Speaker 1: and the road to the White House for Donald Trump
Speaker 1: the first go round. How are you thinking about some
Speaker 1: of the terminology that's being you the rhetoric that's being
Speaker 1: used by Donald Trump.
Speaker 4: Well, this is something that we've seen going all the
Speaker 4: way back to Trump's first run in twenty fifteen and
Speaker 4: twenty sixteen that kind of winking at the far right,
Speaker 4: either through phrases or memes or videos or what have you.
Speaker 4: I don't know whether this was intentional or not, but
Speaker 4: you know, given Trump's background, given the praise he heaped
Speaker 4: on some of the Charlottesville protesters in twenty seventeen, another
Speaker 4: earlier controversy over anti Semitism, It's something that people in
Speaker 4: the press and people in the elector I think are
Speaker 4: very alert to. So something like this pops up in
Speaker 4: a Trump video, you see the media pouncing, you see
Speaker 4: the attention to it, and it's something that the Trump campaign,
Speaker 4: either intentionally or unintentionally, hasn't really managed to fix and
Speaker 4: bottle up and kind of clean up their campaign. But
Speaker 4: I think we can see based on this it's something
Speaker 4: that we're going to have to keep an eye on going.
Speaker 1: Forward, right, and certainly those undecided voters are keeping an
Speaker 1: eye on too. That maybe explains what you just talked
Speaker 1: to in your story. Hey Bloomberg, Bloomberg BusinessWeek national correspondent
Speaker 1: Josh Green, Josh, thank you so much.
Speaker 2: You're listening to the Bloomberg Business Week podcast. Catch us
Speaker 2: Live weekday afternoons from two to five pm. Easter Listen
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Speaker 1: Also this past week, JP Morgan CEO Jamie Diamond says
Speaker 1: he expects problems to emerge in private credit and warned
Speaker 1: that there could be hell to pay. That's a quote,
Speaker 1: particularly as retail clients gain access to the booming asset class.
Speaker 3: JP Morgan and other lenders have been competing with the
Speaker 3: one point seven trillion dollar private credit industry, with giants
Speaker 3: such as Apollo Global Management taking on ever larger deals.
Speaker 3: We got an update and talked risks with on Arsov,
Speaker 3: global head of Private Credit and Financial Institutions at Moody's
Speaker 3: Investor Service.
Speaker 6: Everybody wants a piece of the action, meaning either to
Speaker 6: invest in the business or build a business, and we
Speaker 6: went when the business is relatively mature, and particularly now
Speaker 6: with the opening of the leverage finance market and I'm
Speaker 6: talking about direct lending specifically, we are worried that created
Speaker 6: terms will suffer and eventually there will be deals who
Speaker 6: are done maybe less prudentially. When there was less competition,
Speaker 6: particularly between the public and the product markets and leverage lending.
Speaker 6: So we are concerned and we're seeing actually created terms
Speaker 6: of seriation. We are seeing competition for talent as well,
Speaker 6: and at the same time a lot of dry powder
Speaker 6: being raised that has to be deployed and maybe deploy
Speaker 6: the terms that are going to be less favorable for
Speaker 6: credators in the near term and media term.
Speaker 1: All right, so bummer for the creditors, right, the folks,
Speaker 1: you need to borrow the money. But having said that,
Speaker 1: as we kicked it off with Anna, the idea that
Speaker 1: so many people want to be a part of it.
Speaker 1: Doesn't that I'm playing devil's advocate a little bit, But
Speaker 1: doesn't that kind of spread around the risk in the
Speaker 1: private credit market so that there's not just one entity,
Speaker 1: one lending entity, if you will, that's kind of stuck
Speaker 1: holding the bag if things go wrong.
Speaker 6: It is Diversification is always good at risks. The issue
Speaker 6: is that our statistics have shown that the biggest fundraising
Speaker 6: actually is going now.
Speaker 1: Increasingly to the largest players.
Speaker 6: So therefore this is becoming a more concentrated market. Sorry
Speaker 6: for this has been a more concentrated market, both on
Speaker 6: the private equity side, but particularly private credit fundraising is
Speaker 6: indeed going to the largest and more established players. So
Speaker 6: with that being said, we are diversification is very interesting
Speaker 6: because it is the same pension funds, an insurance companies
Speaker 6: who are investing on the private equity side, and also
Speaker 6: over sovereign funds are also investing in the private credit
Speaker 6: and so they're all increasing their exposure. The good thing
Speaker 6: is here this from a systemic risk perspective, these are
Speaker 6: different funds with different investment than underlying so there is
Speaker 6: not that big concentration of one type of a risk
Speaker 6: let's call it, you know, subprem mortgage, US suprem mortgage,
Speaker 6: or US office commercial real estate in one type of
Speaker 6: fund is diversified to many real moneys that have a
Speaker 6: long term perspective and long term investment horizon and also
Speaker 6: without necessarily immdiate liquidity call or risk. So that's the
Speaker 6: good about this market. You're absolutely right the specification of
Speaker 6: the investment community and also not imminent liquidity draw that
Speaker 6: these kind of investors are coming in with.
Speaker 3: When I'm wondering, are you going to come on our
Speaker 3: show and say that private credit is not hot? When
Speaker 3: does that happen?
Speaker 6: You know what? That's so if you think about where
Speaker 6: we are in what eating. A lot of us have
Speaker 6: been talking about private credit as equivalent to direct lending,
Speaker 6: and direct lending is just another middle market now expanding
Speaker 6: to larger middle market leverage trends business, but private credit
Speaker 6: is beyond that. There's a lot of talk about potentially
Speaker 6: the abs private credit market, which you know, if you
Speaker 6: listen to various pondents in anywhere between ten and forty trivia,
Speaker 6: any kind of asset from any bank that potentially can
Speaker 6: be sold. Is that auto, is that aircraft receivables, is
Speaker 6: that actually data centers or explained as even you know,
Speaker 6: commercial real estate that the potentially can be packaged in
Speaker 6: a private securitizations that will have basically be deployed into
Speaker 6: the kind of the investner community, same insurance companies, pension funds,
Speaker 6: summer funds. So therefore, if you take a broader picture
Speaker 6: of private credit or any credit provision that's not done
Speaker 6: by the banks but financing our economy, that means that
Speaker 6: this is going to be here to stay for quite
Speaker 6: a long time.
Speaker 1: So Moody's, we know who you are, and you guys
Speaker 1: look at these things and try to assess risk. So
Speaker 1: where's the risk and the private credit market today.
Speaker 6: So the risks are really again they are mostly housed
Speaker 6: again within institutional investors that are sophisticated investors and the
Speaker 6: sub funds and again pension funds have the largest part
Speaker 6: of this, then insurance companies, then sovereign funds. The growth
Speaker 6: into retail funds and is what we are being raising
Speaker 6: as a particular concern. Look at where the new BBC
Speaker 6: Information and Business Development companies for benefit of your of
Speaker 6: your viewers here is that there is like the largest
Speaker 6: funds that have been grown is with retail or high
Speaker 6: net worth money. And the question there is these type
Speaker 6: of funds have a different kind of liquidity calls if
Speaker 6: you were, an ability for retail investors to basically call
Speaker 6: their money on a quarterly basis, right, And that's where
Speaker 6: the biggest growth has been. So one can say, you
Speaker 6: can be Teble's advocate, Well, shouldn't retail and high netword
Speaker 6: individual also benefit from the growth of private markets.
Speaker 7: And the answer to that is of course.
Speaker 6: But the second one it's done in the prudential way
Speaker 6: sufficiently with the right disclosure, so afterwards they really know
Speaker 6: what they're getting and then they cannot get their money overnight.
Speaker 1: It's so funny that you said this. I was just
Speaker 1: having a discussion with someone in preparation for a panel,
Speaker 1: and this whole idea of even a credited investors, do
Speaker 1: they understand liquid versus ill liquid?
Speaker 8: Right?
Speaker 1: Because private credit not as long liquid is certainly kind
Speaker 1: of your bread and butter investments, and so do they
Speaker 1: understand going into one of them, or going into a
Speaker 1: private credit fund that if they need the money or
Speaker 1: want the money, it's not so easy to pull out? Correct?
Speaker 6: Exactly? So typically how these fonsor are orchestrated.
Speaker 1: And just got about thirty seconds.
Speaker 6: Yeah, yes, you can have a quarterly you know, small
Speaker 6: portion of liquidity is funds that have established or beck
Speaker 6: in this space have a provision of bank clients to
Speaker 6: provide for that and more liquid access. But not the
Speaker 6: point being is that investors need to really be aware
Speaker 6: that this is any liquid access and they're locked for
Speaker 6: some period of time and they cannot take their money back,
Speaker 6: and growth in that area can create disclosure risks.
Speaker 9: Risks that's what the fonds to watch for.
Speaker 1: Yeah, it's just, you know, certainly a topic that fascinates
Speaker 1: us in a big way. Put a private credit story
Speaker 1: on the most on the Bloemberg, and it tends to
Speaker 1: be among the most right a.
Speaker 3: Million bucks a year salary. Some of those folks the.
Speaker 1: Firm, Anna are so global head of private credit financial
Speaker 1: Institutions at Moody's Investors Service, always fund to check and
Speaker 1: with you really appreciate it.
Speaker 2: You're listening to the Bloomberg Business Week podcast. Listen live
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Speaker 1: Dell was an interesting stock this week, closing at a
Speaker 1: record before earnings and then plummeting after earnings after its
Speaker 1: first revenue increased since twenty twenty two wasn't enough to
Speaker 1: impress investors high expectations for the company's AI server business.
Speaker 3: We recently heard how Dell is expanding its AI factory
Speaker 3: with Nvidia to include new servers, edge workstations, solutions and
Speaker 3: services advancements that speed AI adoption and innovation. You may
Speaker 3: recall to you that CEO Michael Dell has talked about
Speaker 3: aipcs being quote pretty standard in twenty twenty five.
Speaker 1: I will say some industry watchers and analysts are a
Speaker 1: little suspect about not just for Dell, but the whole
Speaker 1: thing out AI PCs.
Speaker 3: Maybe AI phones come sooner, yeah.
Speaker 1: Exactly, and maybe from Apple all right. In general, though,
Speaker 1: we wanted to hear more about what Dell is up
Speaker 1: to when it comes to AI, which you know, has
Speaker 1: been around for a long time, they've been working on it.
Speaker 1: For that, we turned to John Rose, he's Global Chief
Speaker 1: Technology Officer at Dell Technologies.
Speaker 3: We spoke to him before the release of Dell's latest
Speaker 3: earnings report.
Speaker 9: Last year, the first year of the AHI era, you know,
Speaker 9: I think most enterprises were trying to figure out what
Speaker 9: should they do, and largely most of the large enterprises
Speaker 9: did a lot of experimentation. This year is different. This
Speaker 9: year many of those initial experiments which we're really trying
Speaker 9: to figure out where to apply this technology for the
Speaker 9: best return. You know, if you're an enterprise, you could
Speaker 9: apply aid to anything, but if you apply it to
Speaker 9: your supply chain or your product development cycle, or something
Speaker 9: that really moves the needle from an economic perspective, that'll
Speaker 9: have a bigger impact. So I think today most enterprises
Speaker 9: are triangulating on where to apply it, which then gets
Speaker 9: them to the discussion of how to apply it. And
Speaker 9: that's where you know, the panel we add when we
Speaker 9: were chatting kind of went, which is, this is not
Speaker 9: a workload that's sitting on the side used by three people.
Speaker 9: This is the center of your enterprise. It's going to
Speaker 9: run NonStop, seven x twenty four. It's going to power
Speaker 9: your sales process, is going to power your customer satisfaction.
Speaker 9: And so choosing the right place to run it, whether
Speaker 9: you know that gives you the best economic outcome, the
Speaker 9: best control, doesn't get you into compliance and regulatory challenges,
Speaker 9: is really the dialogue that's happening now. And so a
Speaker 9: lot of the work we're doing that you mentioned on
Speaker 9: the intro around with our ECOSYSTM around Nvidia and Meta
Speaker 9: and everybody else, is how do we reduce the complexity
Speaker 9: to make that decision, How do we make it easier
Speaker 9: for people to get started, to not have to do everything,
Speaker 9: and to really get the platforms in place where they
Speaker 9: need them. In our opinion, one of the best places
Speaker 9: to do some of this stuff is clearly in their
Speaker 9: own owned infrastructure. One it tends to be a CAPEX model.
Speaker 9: And two, it's in your control and it's much more predictable.
Speaker 5: John.
Speaker 3: For years, we've heard about the cloud being what's nimble
Speaker 3: and the cloud being the place that we can do
Speaker 3: this stuff in it secure, cure do this stuff for
Speaker 3: less expensive. I'm wondering the shift on premise is not
Speaker 3: a shift. It's been around for since before the cloud.
Speaker 3: But why are we seeing and talking so much about
Speaker 3: the shift right now?
Speaker 9: Yeah? This is Remember the cloud era was all about
Speaker 9: taking your existing workloads, your web servers, your email, your
Speaker 9: office productivity, and maybe trying to figure out a different
Speaker 9: way to operate if by a cloud wasn't just public cloud.
Speaker 9: The cloud model pervade everything, and so you know, the
Speaker 9: shift autonomous, automated elastic infrastructure happened with a set of
Speaker 9: applications that we understood.
Speaker 8: Well.
Speaker 9: The things we're building now look nothing like that. A
Speaker 9: large scale generative AI system for an enterprise is arguably
Speaker 9: the most demanding and complex workload you will create in
Speaker 9: your lifetime. And so you know, we're You could argue that,
Speaker 9: you know, an optics driven as a service model that
Speaker 9: gives you lots of agility, but you pay by the
Speaker 9: drip is not a very good outcome. If the thing
Speaker 9: you're running runs seven x twenty four at enormous performance levels,
Speaker 9: you know you don't want that meter running. You want
Speaker 9: that meter to be predictable, and so it's just a
Speaker 9: different class of workload. By the way, we're big proponents
Speaker 9: in multi cloud. A lot of the time, the best
Speaker 9: place to develop your AI system is in one of
Speaker 9: the cloud providers because they have a great tool chain.
Speaker 9: The best place to test it might be there, Maybe
Speaker 9: the best place to train your models might be there
Speaker 9: because you only need the infrastructure for a short period
Speaker 9: of time. But the minute it becomes inference that you're
Speaker 9: putting it into production and it's using your data, which
Speaker 9: by the way, most of that is on prem even today,
Speaker 9: then it starts to become a very different discussion, which
Speaker 9: brings kind of this modern on prem architecture that we
Speaker 9: talk about with the AI factory into play as probably
Speaker 9: one of the more logical places to start.
Speaker 1: Well, what is exactly the concept of an AI factory?
Speaker 9: Yeah, here's the important thing for people to realize. AI
Speaker 9: is a new workload, and by the way, it actually
Speaker 9: needs a new class of infrastructure, the type of compute
Speaker 9: is not CPUs, it's GPUs. The type of data is
Speaker 9: not traditional databases, it's vectorized data that lives in large
Speaker 9: language models. The kind of tools you use are different.
Speaker 9: And so what we talked about a Dell Technologies world
Speaker 9: was not a new set of products exclusively. It was
Speaker 9: you really probably need to have a separate type of
Speaker 9: infrastructure for your AI than you do for the traditional
Speaker 9: things that you do those workloads that went through the
Speaker 9: kind of cloud migration we talked about, And what the
Speaker 9: AI factory is is it's an articulation of what that
Speaker 9: infrastructure looks like. That it is accelerated compute, that it's
Speaker 9: a different kind of data architecture, it's a better and
Speaker 9: different type of networking architecture, and that it probably lives
Speaker 9: in a different footprint because it itself has different requirements
Speaker 9: than your legacy applications and the other applications you run
Speaker 9: in either a public cloud or a private environment. And
Speaker 9: so the AII factory is how do you create a
Speaker 9: methodology and organize all the technology to put that in play,
Speaker 9: whether it's at a rack level or even an entire
Speaker 9: data center, that builds you the optimal infrastructure to run
Speaker 9: these new workloads that you're going to need. So think
Speaker 9: of it as just a paradigm shift. We're going to
Speaker 9: have to build new infrastructure for this new workload. It
Speaker 9: might be redesigning or optimizing what we have, and it
Speaker 9: might be in fact being your data center build out.
Speaker 1: And it's really interesting and I think we might have
Speaker 1: talked about this at the Bloomberg Intelligence event, but about
Speaker 1: you know, technology companies, they compete, they work with each other,
Speaker 1: and it was interesting at Dell Tech World the keynote
Speaker 1: stage to see Jensen Wang and Video's CEO up there,
Speaker 1: and so there's really you know, you can see the partnership.
Speaker 1: You can see there's clearly a show support from in
Speaker 1: Video to you guys at Dell. What is the nature
Speaker 1: of this partnership, especially when they make their own AI
Speaker 1: server racks, which makes you competitors to some degree.
Speaker 9: Remember, Dell is a unique company. We are obviously very large,
Speaker 9: and you could argue we're the largest technology integrator in
Speaker 9: the world. Now it means something to different people, but basically,
Speaker 9: like I don't build my own CPUs or GPUs, but
Speaker 9: what I do is I organize that technology into consumable
Speaker 9: units of it that my customers across the world can consume.
Speaker 9: Now when you look at what in Video is doing,
Speaker 9: they clearly are the provider of some of the better
Speaker 9: GPUs in the world. There are other choices that we
Speaker 9: also work with. They also have organized their stack in
Speaker 9: a way that makes it very easy to consume, and
Speaker 9: I think that did a great job there. And so
Speaker 9: they have an early lead and it's importantly that they're
Speaker 9: they're making it much more consumable and they're keeping the
Speaker 9: innovation cycle up. However, their ability to engage with the
Speaker 9: large enterprise across the world. They don't have the we
Speaker 9: OWT much larger salesforce. We have a global services capability,
Speaker 9: We have the largest supply chain that's secure in the
Speaker 9: world and technology and so. And by the way, you
Speaker 9: also don't just need the GPUs, you need the advanced
Speaker 9: storage services. You need to integrate it with your existing infrastructure.
Speaker 9: You need to talk to your existing data, which by
Speaker 9: the way, rides pretty much on Dell Technology storage systems.
Speaker 9: And so the nature of the relationship is, look, hey,
Speaker 9: you're trying to build an AI factory. There are some
Speaker 9: leading edge parts that absolutely have to be produced. And
Speaker 9: one way to actually make sure that they happen correctly,
Speaker 9: is to integrate them into a system, an early system
Speaker 9: like what Nvidia does. However, those parts are decomposable and
Speaker 9: then they can reassemble into other form factors that companies
Speaker 9: like Dell can take to a much more scalable market.
Speaker 9: The announcements around edge and other areas. We have the
Speaker 9: ability to reach more customers than anybody in the world.
Speaker 9: We need partners to help us build the technology to
Speaker 9: bring it to them.
Speaker 1: Is your partnership with Nvidia a little bit different? Is
Speaker 1: it a deeper one because you do have partnerships with
Speaker 1: other server manufacturers as well in others? Is it a
Speaker 1: deeper relationship or how would you call it?
Speaker 9: Yeah, we worked with you know, we worked with a
Speaker 9: lot of companies, and what I will tell you is
Speaker 9: the first one. It was the deepest. Last year we
Speaker 9: announced Project Helix, which was the first time anybody articulated
Speaker 9: putting all the parts together into something people could consume.
Speaker 9: So it has a significant first mover advantage. However, you know,
Speaker 9: like I said, we work with a lot of companies
Speaker 9: and we have a lot of partners.
Speaker 3: Yeah, I'm wondering how big John, the AI server opportunity
Speaker 3: is for Dell in twenty twenty five, and then how
Speaker 3: big it could be over the next few years. What
Speaker 3: are you folks talking about internally and externally?
Speaker 9: Well, so I'm a CTO, so I'm not going to
Speaker 9: talk about people.
Speaker 1: But are you really busy?
Speaker 2: John?
Speaker 9: I am extraordinarily busy. But let me paint a picture
Speaker 9: that's a little longer term, you know, and that is Look,
Speaker 9: we are, as I mentioned, we're in now year two
Speaker 9: of the AI cycle, the modern AI cycle, and year
Speaker 9: one was all about surprise, get organized. Year two is
Speaker 9: about the first kind of enterprise deployments and kind of
Speaker 9: the prototypes. What that means is that the enterprise buildout
Speaker 9: hasn't actually begun. And if we look at the size
Speaker 9: of the AA market today and what's going on, it's
Speaker 9: a pretty interesting market. What's happening is we're building the
Speaker 9: foundational technologies, we're training the large language models that this
Speaker 9: is a very robust ecosystem right now, we are developing
Speaker 9: the tool chains, and as you can see from you know,
Speaker 9: just the state of the industry, it's a pretty exciting
Speaker 9: and a pretty significant shift that is in front of
Speaker 9: the enterprise cycle where conservatively, you know, most most people
Speaker 9: we look up with a long term The AI cycle
Speaker 9: is about rebalancing a sizable portion of the work in
Speaker 9: the world into the machine layer, and so as that occurs,
Speaker 9: you know, it represents you know, sometimes we use the
Speaker 9: phrase we're in the training era. Now we're about to
Speaker 9: enter the infront ra for enterprise, which is AI gets
Speaker 9: put into production. When it does, you know, you can
Speaker 9: calculate imagine a world where you know, a third of
Speaker 9: the work is now happening in a machine layer. It's
Speaker 9: being done by a machine an AI system. What does
Speaker 9: that look like? How big is that? Well, you can't
Speaker 9: calculate it accurately, but you know it's a gigantic number.
Speaker 9: And it's as big as the Internet build out, it's
Speaker 9: as big as the Industrial revolution. In many of the
Speaker 9: discussions that we have, the timing on it, it's an
Speaker 9: extended cycle. This will be a twenty year cycle, but
Speaker 9: we're about to enter that phase. And what it tells
Speaker 9: us is it's a significant amount of replumbing of enterprise.
Speaker 9: It's building out AI factories, it's rethinking your data strategy,
Speaker 9: it's rethinking your footprint in the multi cloud, and all
Speaker 9: of that tends to give it our breath and depth
Speaker 9: in our ecosystem, drag us into an awful lot of
Speaker 9: customer conversations in a pretty active world, even in advance
Speaker 9: of the significant buildouts occurring on the inference side.
Speaker 3: So okay, So if we're only in year two when
Speaker 3: it comes to AI, where are corporates in their AI journey?
Speaker 3: How do they adopt their technology? We know Dell want
Speaker 3: a meaningful chunk of Tesla's AI rolled out, for example,
Speaker 3: but where are corporates in their AI journey?
Speaker 9: Yeah, the corporate As I mentioned before, last year, it
Speaker 9: was all about getting your feet on the ground, understanding
Speaker 9: the technology of earning what a large language model, earning
Speaker 9: what RAG was, and this year it's all about finding
Speaker 9: those first projects. The first projects are largely under development
Speaker 9: in most large enterprises, and some of them are emerging
Speaker 9: as chat thoughts and other services that we're starting to see.
Speaker 9: And there are definitely early examples of technology that have
Speaker 9: been deployed as new offerings. But the full pivot where
Speaker 9: a company now declares that I am in the center
Speaker 9: of my business, you know, building my product, selling my product,
Speaker 9: servicing my product, engaging with my customers based on primarily
Speaker 9: an AI architecture that is still work to be done,
Speaker 9: and so I think you know at this point, we're
Speaker 9: still right now in most large enterprises, in the first
Speaker 9: proof of concepts, the first prototypes. But one of the
Speaker 9: things that's different about AI is it does not take
Speaker 9: three years to build one of those. You can go
Speaker 9: from idea based on the tool chains available to having
Speaker 9: something in production that you can start to really do.
Speaker 9: And we're doing that inside of Dell make your developers
Speaker 9: more productive in a matter of months. And so the
Speaker 9: velocity of this cycle is something that we've never seen before,
Speaker 9: which means the gap between getting your feet on the
Speaker 9: ground and being in production and transforming your enterprise is
Speaker 9: not a ten year cycle.
Speaker 1: Hey, John, I keep hearing you know, you've said it,
Speaker 1: and I've had other guests, but when they talk about
Speaker 1: AI and in inference, right, am I saying it correctly?
Speaker 3: Yeah?
Speaker 8: Right?
Speaker 1: How is that different from AI training? And is that
Speaker 1: kind of a new concept or is that just something
Speaker 1: more complicated when it comes to generative AI.
Speaker 9: No, they're part of the same cycle that the idea
Speaker 9: behind AI is. Look, you're trying to have a machine
Speaker 9: do some kind of cognitive work, you know, answer a
Speaker 9: service call, sell something build a right code. In order
Speaker 9: to do that, the first step is that you must
Speaker 9: have that machine have some access to the knowledge necessary
Speaker 9: to do that, which is what training is about. The
Speaker 9: difference in large language models is that we've developed techniques
Speaker 9: that allow us to instead of trying to as human beings,
Speaker 9: decide how to code, we've learned that if you just
Speaker 9: expose these new techniques, these new technologies, large language models,
Speaker 9: to a gigantic set of coding, just examples of coding,
Speaker 9: they will classify them, organize them, and create a neural
Speaker 9: network and interestingly enough, they will then be able to
Speaker 9: replicate that intelligence, that behavior. And so the training phase
Speaker 9: is about taking gobs of data in the current phase,
Speaker 9: it's the entire Internet and run it into these models
Speaker 9: that create systems that can understand or communicate human language,
Speaker 9: that can code, And all that is is them deriving
Speaker 9: from a gigantic data set the knowledge that's contained within
Speaker 9: it to create a set of skills. That's training. Inference
Speaker 9: is totally different. Inference is that once you have that model,
Speaker 9: now you want to do something with it. You have
Speaker 9: a thing that can code great well. Inference is when
Speaker 9: you tell it to code a program, to actually produce
Speaker 9: source code that does something. So they're just two halves
Speaker 9: at the same coin. One is learning to create the capability,
Speaker 9: the other is the act of using the capability and production.
Speaker 1: Hey, listen, something I got to ask you. It's a
Speaker 1: story that's on the Bloomberg and this has to do
Speaker 1: with Nobel Laureate. He's also an economics professor. We're talking
Speaker 1: about Paul Romer, and he was talking with our team
Speaker 1: here and he said, runaway confidence and artificial intelligence risks,
Speaker 1: repeating the mistakes of the crypto hype bubble of only
Speaker 1: two years ago. He says, right now, there's way too
Speaker 1: much confidence about the future trajectory of AI. When people
Speaker 1: project this phote, I think they're at risk of making
Speaker 1: a very serious mistake. Do you think that there's too
Speaker 1: much confidence about AI? Do you think there's too much euphoria.
Speaker 9: And two answers to that in the general population. I
Speaker 9: think it's a very confusing space because we have basically
Speaker 9: the human race is maybe susceptible to science fiction, and
Speaker 9: we think that what we're producing is artificial general intelligence,
Speaker 9: and we're producing these these these sentient beings, these are
Speaker 9: non sentient beings.
Speaker 3: These are Yeah, technologies.
Speaker 9: Yes, yeah, maybe sometimes we all believe there's a path AGI,
Speaker 9: it's just not in the near term. That whole dialogue
Speaker 9: in that let's call it the consumer general market, which
Speaker 9: is primarily where most of the big public AI players play,
Speaker 9: is a risk because people think these have personalities. They
Speaker 9: don't understand the technology. When you come to the enterprise world,
Speaker 9: it is far more conservative. There is no enterprise in
Speaker 9: the world that's trying to build the terminator or a
Speaker 9: sentient being. What we are doing is we're applying the
Speaker 9: techniques that we're pioneered in the public AI world large
Speaker 9: language model space to very specific problems within a corporation
Speaker 9: that could benefit from it, writing code, finding your customers,
Speaker 9: engaging to solve problems. Those are the things that are mattering.
Speaker 9: So enterprise is kind of boring, to be perfectly honest,
Speaker 9: versus what is in the art of the possible in
Speaker 9: the public world. However, as you know, our industrial complex
Speaker 9: is quite large and the impact is much bigger.
Speaker 1: Great stuff already looking forward. The next time we get
Speaker 1: to catch up, John, Thank you so much. B well.
Speaker 1: Don Rose his global Chief Technology Officer Dell Technologies, joining
Speaker 1: us from New Hamps. You are listening and watching Bloomberg
Speaker 1: Business Week Carol Masser along with Tim Stanovic, and this
Speaker 1: is Bloomberg.
Speaker 2: You're listening to the Bloomberg Business Week podcast. Catch us
Speaker 2: live weekday afternoons from two to five pm Eastern. Listen
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Speaker 3: Well, Carol, if you've seen her or even uttered the
Speaker 3: word vibe session, then you can thank our next guest. Yes, okay,
Speaker 3: because she's the one who coined it. She's a former
Speaker 3: Associated Capitol Group. She's now a TikTok star. She's a
Speaker 3: financial educator and commentator. She's a blogger, she's a Bloomberg
Speaker 3: Opinion contributor. And she's the author of a new book.
Speaker 3: It's out now. It's called In This Economy, How Money
Speaker 3: and Markets Really Work. We got with us Kyla Scanlon.
Speaker 3: Kylo welcome, How are you.
Speaker 7: Oh, I'm good, Thanks for having me.
Speaker 3: Congratulations on the book. People are putting out books about
Speaker 3: the economy quite a bit, you know, they're trying to
Speaker 3: answer a lot of the questions that people have. Trying
Speaker 3: to explain this. You take a different approach. What was
Speaker 3: the white space that you saw when you were sort
Speaker 3: of putting this all together.
Speaker 1: Yeah.
Speaker 7: I mean the book is largely inspired from the content
Speaker 7: that I do, which just meant to be like fun
Speaker 7: and accessible, and so the book has sixty illustrations. The
Speaker 7: language is also accessible, and so I just really wanted
Speaker 7: to write a foundational guide to the economy that was fun,
Speaker 7: and so that's what the book is meant to be.
Speaker 1: Fun but smart, because these are important issues, right right, Yeah.
Speaker 9: Yeah.
Speaker 7: It talks about inflation, the labor market, gp all of
Speaker 7: those things, and so it's meant to talk about the
Speaker 7: important issues in a way that doesn't feel overbearing or complicated.
Speaker 1: Well, what's your interaction? Like, I feel like I have
Speaker 1: a bunch of nieces that are probably in their their
Speaker 1: in twenties, like early thirties and stuff, and there are
Speaker 1: ones that are very accomplished too, and they'll be like,
Speaker 1: you know, when it comes to money and all this stuff,
Speaker 1: like people feel lost. Why do you totally stop?
Speaker 8: Oh?
Speaker 7: I mean I think we do a disservice to people
Speaker 7: in terms of how we give them information about the economy.
Speaker 9: Yeah.
Speaker 7: I think it just can feel very convoluted, very complex,
Speaker 7: and I think often it's hard to get the right
Speaker 7: information that you need. And the economy is such a
Speaker 7: personal experience too, so a lot of people are like,
Speaker 7: I'd just rather avoid that then think about it. But
Speaker 7: I think if you give them the tools, like they'll
Speaker 7: know how to dig a hole or whatever, and so
Speaker 7: I think it's just overwhelming, But if you distill things
Speaker 7: down in an accessible way, it'll make it a little
Speaker 7: less overwall.
Speaker 1: Right, So how do you approach something like this because
Speaker 1: there's some really serious stuff in here, including monetary policies,
Speaker 1: So think like how did you kind of initially think
Speaker 1: about how you wanted to get into it?
Speaker 7: Yeah, Also I rewrote the book three times, so that's.
Speaker 1: That happens, right, Yeah, No, it was a.
Speaker 7: Grind, but like the whole idea was to use the
Speaker 7: illustrations as kind of a backbone of the book, and like,
Speaker 7: if you buy the audiobook.
Speaker 1: There's a visual like society right especially today.
Speaker 7: Oh yeah, and if you buy the audiobook, there's a PDF.
Speaker 7: But the book starts with the Economic Kingdom, which is
Speaker 7: kind of like the tape story of the economy, showing
Speaker 7: how everything is interconnected. Because I think that's like the
Speaker 7: most confusing part is like how do all these like
Speaker 7: what is the FED and what is monetary policy? I
Speaker 7: don't care? And how does that interact? So everything kind
Speaker 7: of stems from that first drawing, and then the rest
Speaker 7: of the book is sort of an exploration of all
Speaker 7: those those topics with like little jokes interspersed and so, yeah,
Speaker 7: it's just it's been to be fun.
Speaker 1: I love that you go to the Federal Reserve because
Speaker 1: I do feel like if you bring it up in circles,
Speaker 1: are like, yeah, whatever, but you talk about interest rates, right,
Speaker 1: and then everybody like comes alive.
Speaker 7: Yeah. I just I think that people don't like, it's
Speaker 7: not anybody's full like economics education is not that accessible
Speaker 7: to use that word quite a bit, but I think
Speaker 7: that that's like you just have to talk about these things.
Speaker 7: And you know, I think part of the reason you know,
Speaker 7: to go to the BIB session topic that part of
Speaker 7: the reason that people freak out is like I live
Speaker 7: in a system that I don't understand or I feel
Speaker 7: like I don't have the tools to understand. And that's
Speaker 7: the FED is really important to at least have a
Speaker 7: grasp on.
Speaker 3: Can you talk a little bit about how you got
Speaker 3: into it, because you were an associate at Capitol Group
Speaker 3: earlier in your career. You also sold cars at one point. Yeah,
Speaker 3: but talk a little bit about you know, your education
Speaker 3: and then how you how you got into this.
Speaker 7: Yeah, so you're up in Kentucky and I didn't have
Speaker 7: like I didn't even know you could major in economics
Speaker 7: until I got to college. And so for me, it
Speaker 7: was just kind of like, Okay, there needs to be
Speaker 7: some sort of tool out there that people can access,
Speaker 7: like me when I was at age that you can
Speaker 7: understand the world around you. And then when I was
Speaker 7: in college, I had a whole blog and like options trading,
Speaker 7: and so I've always wanted to bring people alongside a
Speaker 7: learning journey and now it's really about the.
Speaker 1: Economy and just you didn't go to Wall Street.
Speaker 7: Well, I guess Capitol Group is like the by side.
Speaker 3: You didn't, but you didn't stay there. I mean like
Speaker 3: you're could have been, like you could have been like
Speaker 3: a terminal subscriber, like.
Speaker 7: You know I was at one point.
Speaker 1: But exactly, so why didn't you stay with it?
Speaker 7: So I graduated into the pandemic and it was kind
Speaker 7: of like it's a personal journey, right, but like for me,
Speaker 7: I was like my life I think is about economics education,
Speaker 7: Like I really weirdly care about this so deeply, and
Speaker 7: I just wanted to bring people up to speed with
Speaker 7: the knowledge that I felt was important for them to
Speaker 7: get access to.
Speaker 1: We're interesting, I'm thinking about we're having this conversation because
Speaker 1: it's also a time, you know, with politics a little on,
Speaker 1: you know, a little crazy is that people say we
Speaker 1: need civic lessons again to really kind of understand how
Speaker 1: government works. But I also agree the same thing, like,
Speaker 1: you're right, we're taught algebra, calculus and all these different things,
Speaker 1: but really understanding how money works and flows and how
Speaker 1: the economy. I studied economics too, and it was because
Speaker 1: I was interested in like understanding how this all works,
Speaker 1: and it really gives you such a great understanding of
Speaker 1: your own picture, but just more broadly, how it all
Speaker 1: plays together.
Speaker 7: Yeah, I mean, I think it's super important, and like
Speaker 7: I said, I think if you don't understand it, it can
Speaker 7: be just really overwhelming. And so yeah, that's the the
Speaker 7: goal of the book.
Speaker 1: So what is the economic kingdom?
Speaker 7: The economic kingdom is all that picture. Yeah, it's all
Speaker 7: the castles, and so it's maybe like a little reductive
Speaker 7: of an image of the economy. You could probably spend
Speaker 7: several pages on it, but it's just been to show
Speaker 7: the interconnectivity between everything. So there's a federal reserve castle
Speaker 7: or a monetary policy castle, like firing a caton into
Speaker 7: inflation meant to represent rate likes. And Yeah, it's just
Speaker 7: like I do think that economics is so fun, And
Speaker 7: whenever I say that to my friends, they're like, please
Speaker 7: get away from us. But I do think like it
Speaker 7: can be really fun and interesting and it doesn't have
Speaker 7: to be so big, and it can have knowledge about
Speaker 7: it that is digestible.
Speaker 3: Well, we're seeing the effects of it play out right
Speaker 3: now with the difference in the way that people feel
Speaker 3: versus what the economy is telling us about historically low unemployment,
Speaker 3: a stock market that is at records, but people just
Speaker 3: don't feel good about inflation. People don't feel good about
Speaker 3: their situation in poll after poll. At the end of
Speaker 3: the day, it's about vibes, you argue, So talk a
Speaker 3: little bit about vibes and the importance of vibes when
Speaker 3: it comes to thinking about the economy.
Speaker 7: Yeah, and to caveat all the vibe discussion, like structural
Speaker 7: affordability is a massive issue, like we have a housing crisis,
Speaker 7: healthcare like child cares up like thirty two percent of
Speaker 7: twenty nineteen. Elder care is ten thousand dollars a month,
Speaker 7: And so that's not meant to reduce the conversation about
Speaker 7: the issues that we're facing as a society that has
Speaker 7: an economy. But you know, the polls are hard, But
Speaker 7: like there was a poll that was released that said
Speaker 7: that fifty five percent of people think that we're in
Speaker 7: a recession, forty nine percent and people think the stock
Speaker 7: market is down.
Speaker 5: Yeah.
Speaker 3: I think there was a Harris poll last week, Hairst Guardian.
Speaker 7: Yeah, forty nine percent think unemployment is at a record high,
Speaker 7: and it's like the opposite, stock market's up twelve percent.
Speaker 7: We're not in a recession. Unemployments at a record low.
Speaker 7: And so I think it really is like, yes, we
Speaker 7: can acknowledge that the economy is tough, and there are
Speaker 7: parts of it that are tough, but you also have
Speaker 7: to acknowledge an element of reality. And I think that's
Speaker 7: where this ViBe's conversation is really important. How people feel
Speaker 7: about the economy really really matters.
Speaker 1: The sentiment matters, right. We see it certainly in the
Speaker 1: financial markets when you talk with individuals, and when you
Speaker 1: were thinking about this book, like, what is the number
Speaker 1: one thing that people just kind of miss in kind
Speaker 1: of understanding how the economy works.
Speaker 7: I mean, I think it's their importance within it. Like
Speaker 7: everything that we do is an economic transaction. Like I
Speaker 7: bought a cup of coffee this morning, That's an economic transaction.
Speaker 7: Like took the subway here economic transaction. And so I
Speaker 7: think people oftentimes will reduce their own importance and this
Speaker 7: big thing that we're all part of.
Speaker 3: You've got an entire chapter on here about housing in
Speaker 3: the American Dream. We just had a story about this.
Speaker 3: It's one of the most read on the Blomberg Terminal
Speaker 3: about how that American dream is slipping away. What are
Speaker 3: your thoughts around owning versus renting right now?
Speaker 7: Yeah, I think it's a really tough discussion. I think
Speaker 7: that it's really a wealth building discussion. So there's a
Speaker 7: chart from the Federal Reserve the distribution of financial assets
Speaker 7: that shows that the bottom fifty percent have all of
Speaker 7: their wealth tied into their home, the top ten percent
Speaker 7: have stock in like business ownership. And so I think
Speaker 7: the way that we think about housing probably has to change.
Speaker 7: It's a speculative investment that we live in, and it
Speaker 7: has to probably be one of the two. It can't
Speaker 7: probably be both. And so I think that's kind of
Speaker 7: the conversation that we have to have around housing. But
Speaker 7: that's an extremely hard conversation.
Speaker 1: In terms of the chapters, is there one that was
Speaker 1: like the trickiest for you or that you were like
Speaker 1: really stewed over or didn't just rewrite it three times?
Speaker 7: Maybe even more? Yeah, I mean the problems chapter was
Speaker 7: hard because you don't want to come off as really
Speaker 7: negative and you also want to provide solutions to It's
Speaker 7: very easy to like sit and talk and be like, oh,
Speaker 7: things are bad, but it's much harder to provide proper solutions.
Speaker 7: And so I think it was hard to discuss the
Speaker 7: problems that we're facing because there are so many. But
Speaker 7: then the opportunities chapter was so much fun to write
Speaker 7: because there are ways to fix the issues we're facing.
Speaker 3: I'm wondering if you you know, you have you have
Speaker 3: the sub stack, you have YouTube, you have TikTok, you
Speaker 3: have Instagram, you have Twitter, slash x slash whatever it's
Speaker 3: called right now, how did you get a book deal?
Speaker 1: Yeah?
Speaker 7: No, that's a good question. So I wrote this piece
Speaker 7: back in July twenty twenty two about the Vibe session,
Speaker 7: and I didn't really think it would be any different
Speaker 7: than any of my other newsletter pieces. But then the
Speaker 7: New York Times was like the opinion section was like,
Speaker 7: would you want to publish with us? And I was
Speaker 7: like yeah, And then Penguin Random House reached out and
Speaker 7: they were like, have you ever thought about writing a book?
Speaker 7: And I wrote books all throughout my childhood, Like my
Speaker 7: first book was when I was eight, about a penguin,
Speaker 7: and so I was like, yes, of course I want
Speaker 7: to write a book.
Speaker 3: Was that one Penguin Random House published I wish?
Speaker 7: Yeah, it was very I'm not like super woo, but
Speaker 7: I was like that's pretty boo boo.
Speaker 5: Yeah.
Speaker 7: Yeah, And so that was how the book deal came about.
Speaker 7: And then I really wanted to provide a static information
Speaker 7: guide rather than social media videos.
Speaker 1: What if, you know, if a younger generation doesn't get
Speaker 1: it right, or people in general don't get it right
Speaker 1: and understand their role in the economy, there's a cost.
Speaker 7: Yeah, totally. I mean I think there's a cost to
Speaker 7: like how we interact with on another, like the polarization
Speaker 7: I think some of the polls are super disparaging and concerning.
Speaker 7: And then I think also like if you don't understand
Speaker 7: the economy, I don't think you understand the potential that
Speaker 7: you might have, like you kind of get stuck in
Speaker 7: certain places or what.
Speaker 1: Do you mean by that? Carry that out for me?
Speaker 7: Yeah, I mean I think it's just like if you
Speaker 7: don't understand like the power that you might have to
Speaker 7: move jobs, like the strength of the labor market, relatives
Speaker 7: like quits and jolts, et cetera, that could hold you back.
Speaker 7: So I think that's a big part of it. I
Speaker 7: think not understanding that inflation going down doesn't mean that
Speaker 7: prices are going down, right, the strength of the economy.
Speaker 7: And I think like mortgage rates are super important to understand,
Speaker 7: like why they're going up when it's a good time
Speaker 7: to buy home, etc.
Speaker 1: What do you think though, in terms of like we
Speaker 1: would talk about with mortgage rates and you know, people
Speaker 1: think it's too high, it's too expensive, can't do the
Speaker 1: American dream. Having said that, historically they're still kind of low. Yeah, Well,
Speaker 1: like how do you like, how do we like, how
Speaker 1: should we be thinking about that, or how do we teach.
Speaker 7: About that well, I think it's like relative, right, Like
Speaker 7: right now they're really high relative to where they've been.
Speaker 1: But the zero or the barely was the abnormal part.
Speaker 7: Right, But you get used to the abnormal part, right,
Speaker 7: You get used to it. And I think like we
Speaker 7: got very used to easy money. You see, like the
Speaker 7: startup industry right now they're really flailing around because money
Speaker 7: is very, very expensive. And I think also like homes
Speaker 7: didn't used to be the place to go to make
Speaker 7: a bunch of money. Like I think it's from eighteen
Speaker 7: sixty to nineteen sixty, they only grew by like zero
Speaker 7: point to zero six percent, And now we really expect
Speaker 7: homes to do a lot of work in terms of
Speaker 7: building wealth, and so I think it's just all relative
Speaker 7: and relative to where we've been. We're in a weird spot,
Speaker 7: but we're always in a weird.
Speaker 3: Spot, and we do have these weird thirty more year
Speaker 3: mortgage products here in the US that are like, you know,
Speaker 3: kind of unique to us. Also, the housing market, we
Speaker 3: could do an entire show it's just about the housing market.
Speaker 3: I want to shift gears a little bit because I
Speaker 3: think a lot of people know you from your TikTok videos,
Speaker 3: especially post Federal Reserve days, where you've been known to
Speaker 3: portray one Jerome Powell on TikTok and it's they're great.
Speaker 3: People love them. I love them. Have you heard from
Speaker 3: J Pellell?
Speaker 7: No, not directly, not directly.
Speaker 3: Okay, what do you mean by not directly?
Speaker 7: Well, I've had the opportunity to interview Mary Daley, who's
Speaker 7: the president and CEO of the San Francisco Bead, and
Speaker 7: she hasn't like said that anything about Jerome Powell, like
Speaker 7: knowing about the videos. But I know her and that's like,
Speaker 7: you know, second degree, and she's great. I really enjoyed.
Speaker 1: She doesn't say he kind of like he does.
Speaker 3: So he's on the terminal. He's on the terminal, so
Speaker 3: you can, you know, and you're you know, you're a
Speaker 3: Bloomberg Opinions triber, so you can always if he.
Speaker 7: Wants to say hi, i'd I'd love to chat.
Speaker 3: But not yet, No, no J pal yet. Who knows.
Speaker 3: Maybe when he writes his memoir, you know you're making
Speaker 3: the parents. Who knows?
Speaker 1: You do write about problems? What did you want to
Speaker 1: do with that?
Speaker 7: Why? Why I wrote about problems? I mean, I think
Speaker 7: the big thing with the problem section is to address.
Speaker 7: I think it's really important to like recognize, yeah, like
Speaker 7: you should feel the way that you do, and like
Speaker 7: there is validity to the feelings that you're having about
Speaker 7: like social media, the algorithms, the onliness crisis, mental health,
Speaker 7: et cetera. Like you have to talk about problems, but
Speaker 7: then you also have to talk about solutions. And so
Speaker 7: that's why paired you know, problems and opportunities together, because
Speaker 7: I think it's doing a disservice to not talk about
Speaker 7: the issues that we're facing.
Speaker 3: So talk about the social media side of this, because
Speaker 3: you do have a section in the chapter und Problems
Speaker 3: just about social media, about social media making it worse.
Speaker 3: One challenge with that in your life, I would imagine,
Speaker 3: is that you have to be on social media and
Speaker 3: you have to be very visible because that's how you
Speaker 3: build your brand, that's how you build your business. What's
Speaker 3: been your experience with social.
Speaker 7: I mean it's been great, Like I don't think I'd
Speaker 7: be in this room without social media, so like I
Speaker 7: have to congratulate it for that. But then I think
Speaker 7: the way that I think about social media is that
Speaker 7: a lot of bad things do come from it, and
Speaker 7: that's why you have to create good things on social
Speaker 7: media to contract the bad things. And so that's why
Speaker 7: I'm on social media and I do social media videos,
Speaker 7: is because that's where people go for news, that's where
Speaker 7: people get their information, and so you have to be
Speaker 7: where people are, especially if you want to educate them
Speaker 7: about the economy. And so that's how I think about
Speaker 7: social media.
Speaker 1: How do you think that it kind of plays out
Speaker 1: eventually that we social media in terms of acknowledging that
Speaker 1: my data, your data, Tim's data is really valua. It's
Speaker 1: what makes them ticket, it's what's made them into the
Speaker 1: largest market cap companies out there. Like how does that
Speaker 1: play out eventually? Like do we get recognition at some
Speaker 1: point for all?
Speaker 7: No, seriously, No, I think you're right. I mean there's
Speaker 7: been a lot of conversations about like getting paid for
Speaker 7: the data usage. I mean, I think it's kind of
Speaker 7: absurd that they're able to sell it and benefit so
Speaker 7: bigly from that and then you don't really have a
Speaker 7: say and where it goes and what you're being sold on.
Speaker 1: And I think that or just sold more stuff and
Speaker 1: like bombarded more stuff to get more data.
Speaker 7: And I think that's the issue, is that people are
Speaker 7: very tired of being constantly sold to, like everything is
Speaker 7: an advertisement, the attention economy, like your eyeballs are commodities,
Speaker 7: and I think that creates a lot of exhaustion under
Speaker 7: the surface.
Speaker 3: I'm wondering about economic decisions that you kind of make
Speaker 3: every day now that you didn't make before you wrote
Speaker 3: this book, Like how have looking how has looking into
Speaker 3: this stuff changed your own behavior?
Speaker 7: Oh, I mean I think that for me, I've always
Speaker 7: been sort of aware of what's going on, but I
Speaker 7: think now I pay attention to what people are saying
Speaker 7: a little bit more in terms of the book, like
Speaker 7: what they're thinking about inflation, because I think that you
Speaker 7: have to. I used to be very data driven, and
Speaker 7: I used to be like, inflation is going down, and
Speaker 7: you should feel better. But now I'm much more likely
Speaker 7: to weigh opinion versus data. And I've yeah, yeah, because
Speaker 7: I've been you know, there's a lot of good papers
Speaker 7: on scrutinizing the data, like is the data actually represented?
Speaker 7: And of course data is a tapestry, right, Like we
Speaker 7: look at a lot of data points to figure out
Speaker 7: what's going on, but I think that they're there. It
Speaker 7: just deserves a little bit closer.
Speaker 1: Looking to now you do think about right sentiment, how
Speaker 1: important it is, But I do also wonder, you know,
Speaker 1: where a data driven company and there are data points
Speaker 1: that do tell what is going on, right, So there's
Speaker 1: that balance of you know, same thing. Like I always
Speaker 1: feel like in journalism you can always find the data
Speaker 1: points to tell any story, but there is also truth
Speaker 1: and information, right that's actually a representative of what's happening.
Speaker 7: Yeah, And I think that's why the Harris Guardian poll
Speaker 7: was so disheartening to see. And you have stick poles
Speaker 7: with the grain of salt, but like to to see
Speaker 7: that people think that the stock market is going down
Speaker 7: when it's just objectively not. Like that's really important to understand,
Speaker 7: and like that's where reality is. You can't have an
Speaker 7: opinion on things that are objectively true. And I think
Speaker 7: that's where that conversation gets really hairy.
Speaker 1: Yeah, you can debate the valuation and maybe say it's
Speaker 1: not right, Sue, but the move is the move right.
Speaker 1: It's just kind of this wacky time, really cool book.
Speaker 1: Like I said, I feel like I have a million
Speaker 1: people in my life that I want to give this too,
Speaker 1: because I think it's it's a really useful book and
Speaker 1: trying to understanding a lot of stuff. Congratulations, thank you
Speaker 1: so much, good stuff.
Speaker 3: Kyla Scanlan is the author of In This Economy, How
Speaker 3: Money and Markets Really Work. The book out today. She's
Speaker 3: a TikTok star and a contributor to Bloomberg Opinion, as
Speaker 3: well as a financial educator and so much more.
Speaker 2: You're listening to the Bloomberg Business Week podcast. Listen live
Speaker 2: each weekday starting at two pm Eastern on applecar Play
Speaker 2: and ANDROYD Auto with the Bloomberg Business Ad. You can
Speaker 2: also listen live on Amazon Alexa from our flagship New
Speaker 2: York station Just Say Alexa play Bloomberg eleven thirty plenty
Speaker 2: ahead in.
Speaker 1: Our second hour of the weekend edition of Bloomberg Business Week,
Speaker 1: including lessons from former CEO and co founder of Whole
Speaker 1: Foods Market John Mackie, unconscious capitalism and whether selling out
Speaker 1: to Amazon was it a good idea?
Speaker 3: Plus legendary guitarist and founding member of the guests Who
Speaker 3: and Bachman Turner Overdrive. Randy Bachman on taking care of
Speaker 3: business by auctioning off over two hundred of his guitar.
Speaker 1: I believe you have to say taken care of biz
Speaker 1: I was trying.
Speaker 3: To Readay, I don't know if we have the rights
Speaker 3: to that.
Speaker 1: I think I kept it within a limited amount, actually,
Speaker 1: and I would all say thank you that I didn't think.
Speaker 3: I don't think any court or jury would confuse that
Speaker 3: iteration of its being anywhere close to the original.
Speaker 1: Some people might be upset with creative expinking, though, that's
Speaker 1: my point. Oh okay, all right. Also this summer it's
Speaker 1: all about brightly colored gemstones. Courtesy of Bloomberg Pursuits.
Speaker 3: First up, he changed how we think about groceries. John
Speaker 3: Mackie co founded Whole Food's Market forty years ago, staying
Speaker 3: on until twenty twenty two years after selling to Amazon.
Speaker 1: John also co authored the New York Times bestseller Conscious Capitalism,
Speaker 1: his new book The Whole Story Adventures in Love, Life
Speaker 1: and Capitalism. He began our Chat at the beginning of
Speaker 1: Whole Foods, founded with his then girlfriend, Renee loss It.
Speaker 8: By the time in open I was twenty five, her
Speaker 8: name was twenty one, So I didn't have a business background,
Speaker 8: neither did she. But we were we were very young
Speaker 8: and idealistic and energetic, and we in the first stor
Speaker 8: was actually called Safer Way back in nineteen seventy eight.
Speaker 8: It was vegetarian store, and we just wanted to sell
Speaker 8: healthy food to people, earn a living, and have some
Speaker 8: fun in a lot of ways. That continued all through
Speaker 8: Whole Foods Market's destiny. We didn't have big growth plans.
Speaker 8: That kind of came along after we relocated that first store,
Speaker 8: which was in an old Victorian house on a non
Speaker 8: commercial street. It was not a great place for a store,
Speaker 8: but the first real whole foods market. When we also
Speaker 8: emerged with another small natural food store, there were our
Speaker 8: friends and together we changed the brand a Whole Foods Market,
Speaker 8: fantastic location, and the store just took off. And then
Speaker 8: we had a terrible flood. We knew we built in
Speaker 8: the one hundred year flood zone, but we had one
Speaker 8: hundred year flood in the first year and first and
Speaker 8: it had been seventy years since there had of been
Speaker 8: a flood like that in Austin. So that caused us
Speaker 8: to need to get a second store, and then that
Speaker 8: was successful too, and then a third store, and then
Speaker 8: I suppose we really started thinking bigger Back in nineteen
Speaker 8: eighty nine, when we opened our first store in California.
Speaker 8: We were California dreaming, and we opened one in the
Speaker 8: Bay Area in Palo Alto, California that took off, and
Speaker 8: it's kind of like, wow, maybe we could even be
Speaker 8: a national company. So it's just changed a lot. But
Speaker 8: it wasn't like we were MBA students that had done
Speaker 8: this market research and decided we were going to build
Speaker 8: this national company. We were just young kids kind of
Speaker 8: having fun, and.
Speaker 3: For lack of a better term, it was much more
Speaker 3: organic than that very very good tim We've got. Thank you.
Speaker 1: Would you have liked anything to have gone differently? Like
Speaker 1: if you could change things?
Speaker 5: You know?
Speaker 8: A question I get asked a lot by media is
Speaker 8: something like, if you could go back and tell your
Speaker 8: younger self, what would you want to tell your younger self?
Speaker 8: And I kind of have three jokes that go along out.
Speaker 8: The first joke is it wouldn't matter, he wouldn't have
Speaker 8: listened to me, And the second joke is I would
Speaker 8: have told him not to get involved with that woman.
Speaker 8: And the third one is is the truth. I don't
Speaker 8: think I would tell him anything because I mean not
Speaker 8: that I didn't make any mistakes, I mean a ton
Speaker 8: of mistakes, and I could have saved that younger self
Speaker 8: from making mistakes, but then I wouldn't have learned the
Speaker 8: lessons I needed to learn. And it all turned out
Speaker 8: so well. Right, So even in the sale to Amazon,
Speaker 8: you're I think so, I mean yeah, I mean, people
Speaker 8: ask me if I have regrets. Do you regret selling
Speaker 8: to Amazon? And the answer is no, I regret the
Speaker 8: circumstances that that made that the best alternative for us.
Speaker 8: It was the best alternative. If I could go back
Speaker 8: to that time, I'd make the same exact decision. And
Speaker 8: the deal has worked out pretty well for Whole Foods.
Speaker 8: I mean, people don't realize that Amazon let us drop
Speaker 8: our prices. We needed to lower our prices to combat
Speaker 8: the whole paycheck narrative, and they helped us. We could
Speaker 8: have done that on our own as a pro public company,
Speaker 8: not easily. It would have been the markets wouldn't have
Speaker 8: tolerated the short term sell off in the stock, but
Speaker 8: we dropped it four times in the first two years.
Speaker 8: Under Amazon. They took the long term view, and then
Speaker 8: they also raised the pay of everybody in our company.
Speaker 8: In the first six months they made you know, they
Speaker 8: went in with a fifteen dollars minimum wage and everybody
Speaker 8: else had to go up from there, so Amazon, and
Speaker 8: then when COVID hit, I mean, how could ah Foods
Speaker 8: have possibly done a lot of delivery Amazon's technology? So
Speaker 8: Amazons was a great partner for Whole Foods.
Speaker 3: It's been a couple of years since you retired as CEO,
Speaker 3: and I'm wondering if today you can walk into a
Speaker 3: Whole Foods and just buy something.
Speaker 1: A couple of points.
Speaker 8: The first one is if you're an entrepreneur and you
Speaker 8: create a business, it's a little bit like you're a
Speaker 8: parent and you have a child. Your child grows up
Speaker 8: and you can guide that child, but the child's not you,
Speaker 8: and the child's going to make some choices you don't
Speaker 8: agree with, and that's okay.
Speaker 3: You still love your child.
Speaker 8: So his Whole Food's doing exactly everything I would if
Speaker 8: I was still CEO. And the answer is, of course not.
Speaker 8: But one of the gifts that I gave to my successor,
Speaker 8: Jason Beekle, who who is the one I wanted.
Speaker 9: I picked Jason, and one of.
Speaker 8: My gifts to him was not to be hovering and
Speaker 8: watching and second guessing him. Just you know, as I
Speaker 8: have a mantra. Now it's not my problem any longer.
Speaker 8: And that's a gift to Jason, because then people aren't
Speaker 8: coming to me complaining about stuff they know I'm not
Speaker 8: going to listen to them.
Speaker 1: Conscious capitalism. You co founded that movement and simply put,
Speaker 1: it's right. You know, we're thinking about business benefiting everybody,
Speaker 1: multiple stakeholders. Many would argue, you know, we talk about
Speaker 1: it in the business environment too, right, a lot of
Speaker 1: investors saying, I think about multiple stakeholders. The business Roundtable
Speaker 1: like talks about it. So you know, I feel like
Speaker 1: we talk a lot John about the wealthier individuals at
Speaker 1: a company are doing really, really well and it's not
Speaker 1: necessarily trickling down. Has conscious capitalism, I'm curious how that
Speaker 1: has evolved in thought for you if it still holds, I.
Speaker 8: Mean conscious capitalisms Now, I feel like it's being attacked
Speaker 8: on two fronts.
Speaker 3: It's being attacked.
Speaker 8: The traditional capitalists are attacking it because they're concerned they
Speaker 8: don't want the owners to lose control of the business,
Speaker 8: and rightly so the owners and the investors get paid last,
Speaker 8: after all the other stakeholders are paid. But then on
Speaker 8: the we'll say on the left, the anti capitalists, there's
Speaker 8: what time to weaponize it in order to take power
Speaker 8: from traditional capitalism. And it's like, no, no, conscious capitalism
Speaker 8: is not an economic system. It's a management flows fee.
Speaker 8: It just really has some very basic principles. First principle
Speaker 8: is is that every business has this potential for higher
Speaker 8: purpose besides only making money. I mean, my body produces
Speaker 8: red blood cells. If I just stop producing them, I'm
Speaker 8: going to die. But that's not my purpose in life
Speaker 8: to produce red blood cells. Business must make money or
Speaker 8: it will die. But that's not exactly why it exists.
Speaker 8: Why does it exist to create value for its customers.
Speaker 3: That's why it exists.
Speaker 8: Doctors heal people, teachers educate, Architects design things, Engineers construct
Speaker 8: things for customers. So do is business and so it
Speaker 8: has this higher purpose and it should articulate that higher
Speaker 8: purpose that unifies stakeholders together.
Speaker 1: Well, then do you think there's enough of conscious capitalism
Speaker 1: going on in society? There's capitalism going on, but do
Speaker 1: you think there's enough of conscious capitalism going on?
Speaker 3: I would like there to be.
Speaker 8: First of all, there's a lot of what I call
Speaker 8: unconscious conscious capitalists. They don't know that they're conscious capitalism.
Speaker 8: But the second key principle or that the stakeholders are interdependent.
Speaker 8: That doesn't mean all stakeholders are equal, no, I mean
Speaker 8: the customers are obviously the most important stakeholder, that's why
Speaker 8: the business exists. And who's second most important, Well, probably
Speaker 8: the investors are, and then probably the team members are third.
Speaker 8: After that, then you have suppliers, and you have the
Speaker 8: communities that we're all.
Speaker 5: Part of it.
Speaker 8: They're all important, they're all interdependent, and a conscious business
Speaker 8: is going to take care of all of them, recognizing
Speaker 8: there is a ranking, there is a hierarchy, and there
Speaker 8: should be businesses. Not people judge business because it doesn't
Speaker 8: act altruistically all the time. And it was like, what
Speaker 8: part of our society does. It's human nature to be
Speaker 8: both both self interested in looking out for yourself and
Speaker 8: looking out for your families first and then, but also
Speaker 8: generous and caring and compassionate.
Speaker 5: We're both.
Speaker 3: We're complex beings.
Speaker 8: This bifurcating people and they're either all completely altruist or
Speaker 8: they're completely selfish and greedy bastards. That's just wrong. That's
Speaker 8: not the way human nature is, and business isn't that way.
Speaker 8: But no other part of our society is either.
Speaker 3: You talk about this in your book, and you learned
Speaker 3: a tough lesson. I think it was back in two
Speaker 3: thousand and nine and you were hiking on a trail
Speaker 3: and you found that the Wall Street Journal had published
Speaker 3: editorial that you had written. They called it the Whole
Speaker 3: Foods Alternative to Obamacare, Eight things we can do to
Speaker 3: improve healthcare without adding to the deficit, and it got
Speaker 3: you in some hot water at the time, people boycotting
Speaker 3: your stores. My question for you is not about is
Speaker 3: not about that. It's about what do you think you
Speaker 3: can say now that you are no longer CEO of
Speaker 3: Whole Foods that you weren't able to say during your
Speaker 3: entire career because you were worried about people boycotting stores
Speaker 3: or people coming after you.
Speaker 8: It's a great question, and my big learning from that
Speaker 8: experiences is that people do not separate the CEO from
Speaker 8: the company, or at least the founder or the entrepreneur company.
Speaker 8: I thought, look America, free speech. I'm expressing my personal views.
Speaker 8: But no one saw it that way.
Speaker 3: They saw it.
Speaker 5: This was Whole Foods views.
Speaker 8: And so there were boycotts and there were bycotts, and
Speaker 8: there was hundreds of letters coming into maybe even thousands
Speaker 8: of letters and emails coming into our board demanding I
Speaker 8: be fired. So I kicked a hornets nest and it's like,
Speaker 8: so I went away from that realizing, Okay, I get it.
Speaker 8: I can't. I don't want to hurt my child, you know,
Speaker 8: So I'm not going to speak up. The board actually
Speaker 8: instructed me never ever again write an op ed piece
Speaker 8: that we haven't signed off and approved.
Speaker 3: So so what could I say today?
Speaker 8: I could say anything I wants to say, except I'm
Speaker 8: a place in my life where I've concluded that political
Speaker 8: talk just gets people so riled up. Today we're like
Speaker 8: these two big tribes that hate each other, and people
Speaker 8: are constantly trying to sort you out which tribe are
Speaker 8: you in because do I love you or do I
Speaker 8: hate you? And it's like, I'm kind of not in
Speaker 8: either one of those tribes because I really believe I
Speaker 8: believe in capitalism, I believe in I believe in personal
Speaker 8: liberty and freedom of speech and freedom of thought, and
Speaker 8: I don't fit into the two big tribal boxes. So
Speaker 8: I can now speak about politics only I'm more or
Speaker 8: less decided I don't want to.
Speaker 1: But is it an interesting coming off the pandemic where
Speaker 1: and George Floyd, the killing of George Floyd, where we
Speaker 1: did see CEOs come out and take positions, and I
Speaker 1: feel like employees wanted their CEOs and leaders to take positions,
Speaker 1: and we talked about the importance of it. So what
Speaker 1: is the balance for a leader who is running a
Speaker 1: company and maybe there are some really important issues out
Speaker 1: there where they should take a stand.
Speaker 8: Here's what I did at Whole Foods during that period
Speaker 8: of time, and this is what I'd actually recommend for
Speaker 8: other CEOs to do as well. First of all, if
Speaker 8: an issue is directly related to the purpose of your business,
Speaker 8: you like you should take a stand. Whole Foods took
Speaker 8: stands on animal welfare, seafood sustainability, things that direct the
Speaker 8: organic agriculture, regenerative agriculture. These are things that are directly
Speaker 8: important to our purpose and why we exist. So I
Speaker 8: think definitely those are things appropriate to speak up on.
Speaker 8: But then it's like all the social justice stuff that's
Speaker 8: not really Whole Foods markets. We can't solve all the
Speaker 8: problems in the world. We've got our We're a mission
Speaker 8: driven business and we have to focus on our business.
Speaker 8: So I remember telling team members that were wanting me
Speaker 8: to speak up on these issues, and I said, listen,
Speaker 8: I believe in freedom of speech. So whatever you want
Speaker 8: to do when you're not at work at Whole Foods,
Speaker 8: you should do that. You want to advocate for certain
Speaker 8: political changes, you should do it. But while you're working
Speaker 8: for our company, we want you to focus on the
Speaker 8: purpose for why we exist. And we're here to nourish
Speaker 8: people in the planet, and so that's a big cost
Speaker 8: to help people be healthier, eat healthier food. Work on
Speaker 8: that on our time, and then do whatever you want
Speaker 8: on your time. And because I can't separate myself as again,
Speaker 8: I don't, As I told you from the two thousand
Speaker 8: and nine thing, there's no way I'm going to come
Speaker 8: out and take these political stands. I can't even my
Speaker 8: board and wouldn't let me do it anyway. We got
Speaker 8: kicked really hard on that one. I'm never going to
Speaker 8: do it again.
Speaker 3: I understand that idea of sort of staying in your
Speaker 3: lane when you're at business, but I also think that
Speaker 3: in this day and age, there are issues that can
Speaker 3: affect a business even if you don't think they will.
Speaker 3: We were talking about affordable housing earlier and the fact
Speaker 3: that the majority of New Yorkers don't earn enough to
Speaker 3: live in New York City at a rate that would
Speaker 3: be deemed you know, affordable thirty percent of your salary.
Speaker 3: So what happens to a business if it can't find
Speaker 3: employees because the people can't live in that area where
Speaker 3: the business is.
Speaker 1: I did a whole piece when you Guys opened in Detroit,
Speaker 1: like it was a big deal to go into that area.
Speaker 8: First of all, I do I really empathize for that position,
Speaker 8: because I know when I was CEO Whole Foods that
Speaker 8: most of our team members that work in our Manhattan
Speaker 8: stores don't live in Manhattan, right They're living in the
Speaker 8: Bronx or Queen's or Brooklyn or some other place.
Speaker 5: So I am.
Speaker 3: Empathetic to that.
Speaker 8: However, I have a different you know, I mean, I'm
Speaker 8: going to speak up on politics.
Speaker 5: Really briefly.
Speaker 8: I mean, the reason we don't have enough affordable housing
Speaker 8: is because we've regulated it out of existence. And I
Speaker 8: always people ask me what to do about this problem.
Speaker 8: I say, we ought to create just like some countries
Speaker 8: create enterprise zones where the rules don't apply, there'd be
Speaker 8: so if a city like New York would set aside
Speaker 8: and places in Manhattan. That would be sort of free
Speaker 8: building zones where they wouldn't have any taxes for housing.
Speaker 8: Affordable housing would not be taxed, would be no real
Speaker 8: estate taxes. You'd have different sets of regulations, say on
Speaker 8: the disability acts. You go to Europe and you don't
Speaker 8: have all of the you don't have to put an
Speaker 8: elevator in everywhere and.
Speaker 5: These areas.
Speaker 8: I'm not saying those regulations aren't good, but I'm saying
Speaker 8: if we want to have more affordable housing, that really
Speaker 8: drives the cost of housing up. And thirdly, manufactured housing
Speaker 8: is the way to do it, to make affordable housing.
Speaker 8: If you look at where most poor people in America live,
Speaker 8: they live in mobile homes. They live in manufactured housing,
Speaker 8: which is far more affordable. That's not really legal inside
Speaker 8: many cities. But if we allowed manufactured housing to come
Speaker 8: in and deregulate some of these areas, you would find
Speaker 8: Manhattan could have plenty of affordable housing.
Speaker 1: Interesting, we have forty five seconds left. Your book is
Speaker 1: called The Whole Story. There's so much more in there,
Speaker 1: and I wish we had more time. I don't know,
Speaker 1: why do you want people to read this book?
Speaker 8: This book is first of all. It reads like a novel.
Speaker 8: It's fun, it's full of joy, it's full of love.
Speaker 8: I mean the things that I talk about in the
Speaker 8: book or creativity, entrepreneurship and love, and this trace is
Speaker 8: my own personal growth both emotionally, psychologically as a leader
Speaker 8: and spiritually. It's a fun read. I really think people
Speaker 8: read it, they're going to like it.
Speaker 1: I hope you can come back because you obviously have
Speaker 1: lots to say and it's really engaging and fun. So
Speaker 1: good luck with it. Maybe when it comes back to
Speaker 1: the coaper book paperback. Rather have you come back? John Mackie,
Speaker 1: he's co founder of Whole Foods Market, joining us here
Speaker 1: in studio his latest book. His new book is entitled
Speaker 1: The Whole Story Adventures in Love, Life, Life and Capitalism.
Speaker 1: So joining us here in our studio.
Speaker 2: You're listening to the Bloomberg Business Week podcast. Catch us
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Speaker 1: Released in nineteen seventy, covered many times over since, just
Speaker 1: one of the many songs from the talented guitarist, songwriter
Speaker 1: and performer rockstar Randy Bachman, who founded two rock bands,
Speaker 1: The Guests Who and rockman Turner Overdrive, writing hits such
Speaker 1: as American Woman, let It Ride, you Ain't Seen Nothing Yet,
Speaker 1: and of course taking care of business.
Speaker 3: And this past week he auctioned off over two hundred
Speaker 3: of his guitars, some of which he used to perform
Speaker 3: some of those iconic songs. It all went down at
Speaker 3: the Julian's Auctions Music Icon sale at the Hard Rock
Speaker 3: Cafe here in New York City.
Speaker 1: And tim we got a glimpse into his rock and
Speaker 1: roll lifestyle and why he decided to auction off many
Speaker 1: of his iconic guitars. Here's Reddy Bachman joining us in
Speaker 1: studio about life on the road.
Speaker 10: When the gig is done and the thousands of screaming, Yeah,
Speaker 10: you're in a car with a bunch of guys where
Speaker 10: you've been on the road for two months and you
Speaker 10: don't really like each other anymore, and everyone else is
Speaker 10: going home with their loved one to a snugly home
Speaker 10: bid and the kids with a babysitter and the fireplace burning,
Speaker 10: and you're all alone on the damn road for thirty
Speaker 10: sixty ninety days and it's that's the flip side. The
Speaker 10: other side is wonderful. It's your teenage dream. You want
Speaker 10: to believe like Jimmy Hendricks or the Beatles, er Lady
Speaker 10: Gag or whatever you want to be. Yeah, you go
Speaker 10: and be that because you have this little talent that
Speaker 10: you've been given as a kid. And it's really amazing
Speaker 10: when you get to do what you want and make
Speaker 10: a living at it.
Speaker 5: That's the good side of it.
Speaker 1: It'd be really successful.
Speaker 5: As what the travelers killer.
Speaker 3: What was the point for you that it sort of
Speaker 3: shifted from living out that teenage dream to feeling like, Okay,
Speaker 3: I want to be home.
Speaker 5: It happens every tour.
Speaker 10: It happens daily, But did it happen earlier teenage dream?
Speaker 10: Now I'm here on this great thing. I'm plugging with
Speaker 10: my guitar sale.
Speaker 3: But look, to be fair, you're traveling a ton, still
Speaker 3: got to go tour.
Speaker 10: You get home, you get anxious to go on the road.
Speaker 10: You get in the road, you get anxious to go home.
Speaker 10: If you ask an actor do you like movies or stage?
Speaker 10: They say yes, You're like one or the other each time,
Speaker 10: and you've got to do kind of both to be
Speaker 10: fully rounded. You can't make a living in this business.
Speaker 10: I can't be an athlete and play a home game
Speaker 10: every all the time. You got to go away. So
Speaker 10: all these glamorous gig regards of getting hundreds of millions of
Speaker 10: dollars to play baseball, there's a downside.
Speaker 5: But the episode's big.
Speaker 1: Now we feel that sometimes, right, We love travel, we
Speaker 1: love our jobs, but you know, it's nice to be
Speaker 1: home and we love that. We're gonna talk about the
Speaker 1: auction in the moment, but I want to ask you.
Speaker 1: In researching, we came across that Elvis Presley's motto taking
Speaker 1: care of Business was inspired by your band song. Have
Speaker 1: you heard this?
Speaker 5: Yes?
Speaker 10: I was a big fan of Elvis. I played crossco
Speaker 10: violin from the age of five to fourteen, and I
Speaker 10: got tired of playing classical music audition for the Winnipeg
Speaker 10: School Junior Symphony and flumt quit playing.
Speaker 5: Went home. That's it.
Speaker 10: I'm never playing the violin again. The next day I
Speaker 10: saw Elvis on television and said, what is that. Oh,
Speaker 10: it's called rock and roll. That's called the guitar, and
Speaker 10: that's called Elvis. All you play on violin is melody.
Speaker 10: You're playing the top line. So my cousins had a guitar.
Speaker 10: I got their guitar. I could play everything because I
Speaker 10: was playing violin by ear. Even in the classical music,
Speaker 10: my teacher played first Chaikovski or Chopin, and I would
Speaker 10: play it. So I started playing lead guitar boom, and
Speaker 10: then I'm in the guests who and then here I am.
Speaker 10: Because of Elvis. A few years ago, after he passed away,
Speaker 10: Priscilla was doing an HBO special in Graceland. She said,
Speaker 10: oh yeah, we were driving to the La airport to
Speaker 10: fly back to Memphis, and Elvis heard a song on
Speaker 10: the radio by a Canadian band, taking Care of Business.
Speaker 10: He went, boom, I want that TCB lightning bolt right away,
Speaker 10: but a big butt of boom, and that became his
Speaker 10: model for his band. It's on his tombstone. Nobody else
Speaker 10: can use that. I wrote the song. I can use
Speaker 10: taking care of Business. He can use it.
Speaker 5: And that's pretty cool.
Speaker 10: I have a buddy. He's waiting somewhere for me to
Speaker 10: show up. Incredible dude singing taking care of business together. Okay,
Speaker 10: not too soon.
Speaker 1: That's pretty cool.
Speaker 3: The auction is something we want to talk about. Yeah,
Speaker 3: two hundred guitars.
Speaker 5: Yeah, and I still have a couple hundred.
Speaker 3: That's that's that's what I wanted. All your care's the
Speaker 3: shoes you.
Speaker 5: Have in your closet.
Speaker 3: You don't know.
Speaker 5: I don't know how many guitars I have.
Speaker 1: I don't even tell my husband. No, it's interesting. My
Speaker 1: husband also plays guitar, not you know, but a lot
Speaker 1: of fun. But it's like, you can never have enough guitars?
Speaker 1: What is that?
Speaker 5: How many shoes do you have? All?
Speaker 2: Right?
Speaker 1: Don what it's done? You not to justify? So why
Speaker 1: are you selling even some.
Speaker 10: Of them when you travel? I want to be like
Speaker 10: Chuck Barry or a lot of these other guys. You
Speaker 10: have a home in London, home in la So you don't.
Speaker 10: We're sick of motels. You'll drive three or undred nights
Speaker 10: to sleep in your own bed for a couple of hours.
Speaker 10: So at home in London, Covent Garden, Santa Monica, Toronto,
Speaker 10: outside of Toronto, Oakfield and Victoria can't.
Speaker 5: Go to them.
Speaker 10: Shut down for three or four you can't go to
Speaker 10: your home. You sell everything, ship it to me. You
Speaker 10: end up with four lawnmowers, four toasters, hundreds of knives
Speaker 10: and forks and hundreds of guitars all coming to your house.
Speaker 10: You got to rent a storage space and you can't
Speaker 10: see them. They're all in a storage so you've got
Speaker 10: to open a door and go in and look at
Speaker 10: your stuff in storage. So it was time to sell it.
Speaker 3: These guitars, though each one of them has a story.
Speaker 5: A lot of these do a lot of them.
Speaker 10: My American Woman nineteen fifty nine less Paul is a
Speaker 10: rare guitar to begin with. You only made a couple
Speaker 10: hundred each year, and the fifty eight, fifteen, nine, and
Speaker 10: sixty are very rare because they were the last time
Speaker 10: they made it with a certain glue that when they
Speaker 10: put the neck in the body, that glue permeated the
Speaker 10: wood in the pores and then petrified. The guitar has
Speaker 10: this brain and it's very heavy. Guitar weighs fifteen pounds.
Speaker 10: You imagine that on your shoulder for four hours every day.
Speaker 10: You end up doing this all the time. It's just
Speaker 10: dynamic tension. Your muscles do that. And I had to
Speaker 10: get a lighter guitar. But I played that one sitting down.
Speaker 10: But it's the sound of an American woman and no time.
Speaker 10: All the guests who hits and a lot of bto
Speaker 10: guitar solos were that guitar. I just didn't play it
Speaker 10: on stage, was too heavy to stand up. So then
Speaker 10: I start to play strat Fender stratocaster. So the two
Speaker 10: white strats I used with bt R, they're their number
Speaker 10: one guitars. They played on You Ain't Seen Nothing yet,
Speaker 10: Let It Ride. My Les Paul was an American woman, no time.
Speaker 10: So these are iconic guitars that have played a number
Speaker 10: one singles and then all the albums on both sides
Speaker 10: of it. So I'm hoping they get a good home
Speaker 10: because sooner or later, you leave home, or your kids
Speaker 10: leave home.
Speaker 5: My kids are leaving home. They don't necessarily want somebody
Speaker 5: adopts them.
Speaker 10: And the American homing guitar is bought by Slash or
Speaker 10: Lenny Kravitz, who deserve it, and it has another.
Speaker 5: Hit it plays.
Speaker 1: Has anybody reached out to you?
Speaker 10: There's a magic in these guitars. We just picked them up.
Speaker 10: They were traveling with us all day and playing them.
Speaker 10: And when you plug it in and play it, you've
Speaker 10: heard the sound before, even though it's strange to you,
Speaker 10: you've heard it on the radio so many times, even
Speaker 10: the rhythm to let it Ride and things like that.
Speaker 10: There's a kaching when you hear it.
Speaker 1: When you play it again, is there any part of
Speaker 1: you that's like maybe in a min't to let it go?
Speaker 10: Yeah, they were handing for me one at a time.
Speaker 10: Last I was a little showcase and I go, shit,
Speaker 10: I don't want to sell this. But I haven't played
Speaker 10: it for eleven years. I'll probably never played for another
Speaker 10: eleven years. It's time for it to get a new
Speaker 10: It was flying for somebody to play them.
Speaker 1: You know, rather that than they're sitting in their cases
Speaker 1: right in a storage room or in your home, the.
Speaker 10: Legal lawyer's library. They don't go to the books anymore.
Speaker 10: It's all on the computer. This is like the guitars.
Speaker 10: You can't get to the guitar. They're all in storage.
Speaker 1: Unbelievable. Having said that, you need to share with our
Speaker 1: audience about the lost guitar. Tell us about that.
Speaker 3: It's one guitar that will not be auctioned off.
Speaker 10: No, I just got it back after being gone forty
Speaker 10: seven forty eight years. Oh, it was stolen from a
Speaker 10: hotel in Toronto or doing a bto album there ad
Speaker 10: vantaged there's no internet then, so I had to fax
Speaker 10: all the guitar stores. I ended up in a frenzy
Speaker 10: buying Gretz guitars. I went through my midlife crisis and
Speaker 10: buying grets guitars. I asked over three hundred and finally
Speaker 10: sold them to Fred Gretch. It became the Fred the
Speaker 10: Gretch Museum in Savannah. George job. But this one that
Speaker 10: was stolen I kept searching for and we got a
Speaker 10: notice back a couple of years ago. Tall and I
Speaker 10: my son were doing Back When, Back When train wreck
Speaker 10: every Friday night on YouTube because there were no gigs,
Speaker 10: and the guy said, I found your Gretch guitar. It
Speaker 10: was in Tokyo with a guy named Takeshi was like
Speaker 10: the Brian Setser of playing rockabilly on this big orange gretch. Yes,
Speaker 10: and my daughter in law is Japanisa. She got set
Speaker 10: up assuming him translated everything. He offered the guitar back.
Speaker 10: I went and founded Sister Guitar from the same year,
Speaker 10: two digits off in the Cereal numbers so I could
Speaker 10: trade him.
Speaker 5: I like guitar.
Speaker 10: We couldn't go to Tokyo, but the Canadian bassor said I'll
Speaker 10: get you as a as a diplomat. You don't have
Speaker 10: to do two weeks of isolation being COVID tests. That
Speaker 10: every day their Canada offered free tickets. Was like everybody
Speaker 10: doing a good deed.
Speaker 5: For this guitar. And we went there.
Speaker 10: They wouldn't let meet toa KESHI or see my guitar
Speaker 10: until I walked on stage on Canada Day, July, the
Speaker 10: first in the Canadian com So to the filming. This
Speaker 10: is being a film. They want to see my face
Speaker 10: when I saw this guitar. It's like if you your
Speaker 10: childhood bike or your dog got run over by a
Speaker 10: truck and then somebody later came to, Oh, your dog
Speaker 10: had poppies, and here's a poppy and it's just like
Speaker 10: your dog. It's Skippy is back, right, So get my
Speaker 10: guitar up.
Speaker 1: Skippy was back.
Speaker 10: They filmed it and it's going to be a film
Speaker 10: coming out very soon being edited right now.
Speaker 3: It's Netflix. Maybe maybe if they did high Okay.
Speaker 1: All right, well will you come back when.
Speaker 10: It's I will, that will be a whole different story.
Speaker 10: That's the guitar I've gotten out home. It was number
Speaker 10: one guitar with the guests, who and Beto with all
Speaker 10: their hits and albums, and maybe I'll have a number
Speaker 10: one again on Rotten Tomatoes or something when the film
Speaker 10: comes out. But my son and I cut an album
Speaker 10: that's coming out that's a soundtrack to the movie.
Speaker 5: Of the Lost Guitar. You never know, you never know.
Speaker 5: It might be my magic feather, might be my dumbbow.
Speaker 5: You can fly. Here's your magic guitar. Another hit song.
Speaker 1: Do you have a favorite hit song of your own?
Speaker 10: I think it might have to be taking care of Business.
Speaker 10: But many teachers come to me that teach handicapped kids,
Speaker 10: altruistic kids, very advanced kids, and to get all their
Speaker 10: attention in the morning, they always play taking care of Business.
Speaker 5: All these little kids left your attention deficit or whatever.
Speaker 5: And also guys going in desert.
Speaker 10: Storm in their tanks to battle playing taking care of
Speaker 10: Business or playing American women in their tanks.
Speaker 5: They're going to fight.
Speaker 10: When the Canadian astronaut was in there, he played taking
Speaker 10: care of Business. I got to say that song thanks
Speaker 10: to Elvis and me.
Speaker 1: He's like, wow, got to feel pretty cool about this.
Speaker 1: Got thirty forty seconds left here. What do you want
Speaker 1: people to know about the auction?
Speaker 5: Well, there's guitars.
Speaker 10: Some of them are on display at the hard Rock
Speaker 10: You can't afford a guitar, Go down to the camera,
Speaker 10: take a picture of the guitar. Some of they're going
Speaker 10: to sell for millions of dollars. The fifty nine that's Paul.
Speaker 10: They're all going Mark and Authors went for one point
Speaker 10: four million pounds or.
Speaker 5: Something like that.
Speaker 10: This was a replica reissue. Mine's a real one from
Speaker 10: fifty nine?
Speaker 1: Are you You stopped playing violin and went this way?
Speaker 5: A should get beat up with the violin I put
Speaker 5: under my armor startday morning. All the guys would beat
Speaker 5: me up. We're playing hockey. It's winter peg.
Speaker 3: Right our thanks to Randy Bachman, founding member of the
Speaker 3: bands the Guests, Who and Bachman at Turner Overdrive. Not
Speaker 3: every day that we get a real life rock star
Speaker 3: now Bloomberg Studio.
Speaker 1: That was so cool. We could have kept on going
Speaker 1: because I feel like even after the mics were off,
Speaker 1: we just kept talking with him and it was pretty
Speaker 1: cool stuff.
Speaker 9: All right.
Speaker 1: Still ahead on Bloomberg Business Week, we say goodbye to
Speaker 1: quiet luxury this summer and delve into bold high design,
Speaker 1: gem setting, gold shaping and very expensive to Laurie.
Speaker 3: Yeah, I'm not going to say goodbye to quiet luxury.
Speaker 1: Okay, Hey Tim, you do you Okay, but we're gonna
Speaker 1: do us.
Speaker 3: Bloomberg Pursuits is next. This is Bloomberg.
Speaker 2: You're listening to the Bloomberg Business Week podcast. Listen live
Speaker 2: each week day starting a two pm Eastern town Applecar
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Speaker 2: New York station, Just say Alexa Play Bloomberg eleven thirty.
Speaker 1: It is time for Bloomberg Pursuits, and this week it
Speaker 1: is the Jewelry Special, featured in Bloomberg BusinessWeek magazine, which
Speaker 1: is out on newsstands, now, online, on Bloomberg dot com,
Speaker 1: and of course always on the Bloomberg terminal. It is
Speaker 1: Tim about loud and shiny accessories.
Speaker 3: Loud, I love it. We're talking eighty two. Thanks well.
Speaker 3: Aluminum and white gold of brace. Let's say one hundred
Speaker 3: and seventeen thousand dollar necklace some men's jewelry. This is
Speaker 3: really interesting and a much more affordable. Thirty six hundred
Speaker 3: dollars yellow gold and titanium pendant. All in this week's
Speaker 3: section of Bloomberg.
Speaker 1: Pursuits here with more the editor of Bloomberg Pursuits, Chris Rouser,
Speaker 1: along with Bloomberg contributing jewelry writer and founder of law Patiala,
Speaker 1: the Luxury encyclopedia Kristin Shirley. Guys, So good to have
Speaker 1: you here with us, Chris, you guys have done these
Speaker 1: sections before. I always feel like it's fun to go over.
Speaker 1: But how are you guys thinking about it? And how
Speaker 1: did you realize it was going to be about kind
Speaker 1: of Boulder kind of accessories for this summer.
Speaker 3: Yeah.
Speaker 11: So we do this jewelry special in BusinessWeek every year,
Speaker 11: and we cover jewelry throughout the year, but then around
Speaker 11: in summertime, we usually try to think see what the
Speaker 11: trends are, what's out on the market, what people are
Speaker 11: being to the big jewelry shows. And Kristin is an
Speaker 11: industry expert and she goes to these shows and she's
Speaker 11: a great jewelry writer. So basically I call her up, Kristin,
Speaker 11: what's going on? Well, what are you saying out there?
Speaker 11: And she said, this year people are having fun.
Speaker 3: Come on in, Kristin, because I'm curious about how they're
Speaker 3: expressing their fun. How is this fun? Manifesting in jewelry
Speaker 3: because you argue that quiet luxury is out the window
Speaker 3: this summer, and in its place is stuff that's loud
Speaker 3: and fun.
Speaker 1: Yeah.
Speaker 12: I think there has been historically a lot of danky
Speaker 12: jewelry that people have been wearing, wearing lots of armstacks,
Speaker 12: you know, layering necklaces, and then a lot of Demi
Speaker 12: find companies got into the mix selling things that were
Speaker 12: more affordable, so everyone kind of looks the same, even
Speaker 12: if you've spent a lot of money on your pieces.
Speaker 12: So now collectors are really looking for ways to express
Speaker 12: themselves with significant pieces that a demi fine jeweler really
Speaker 12: can't recreate, and that's coming out with really bold gemstones,
Speaker 12: big chunky pieces of jewelry, and really fun, exuberant design.
Speaker 1: Hey, Kristin, before we get into some of the pieces,
Speaker 1: I mean, and I really like big and bold, but
Speaker 1: I agree, like you go to Instagram and it's like
Speaker 1: everybody layering necklaces and rings, and it's all kind of
Speaker 1: smaller pieces. How much of what we're going to talk
Speaker 1: about in just a moment often then kind of finds
Speaker 1: its way into the broader consumer space and style space.
Speaker 12: This will all be coming probably to the regular consumer space,
Speaker 12: I would say in a couple of years, but they'll
Speaker 12: never be able to recreate the same looks of these
Speaker 12: absolutely fabulous gemstones and amazing diamonds. That's one reason why
Speaker 12: Demi Fine jewelers do so well with real small diamonds,
Speaker 12: smaller crystals, because you can't really tell the difference on
Speaker 12: a small scale. Once you get to really significant gemstones,
Speaker 12: there's really no way to replace that.
Speaker 11: So on the opener page of our section, there is
Speaker 11: this photograph that I really love by Joanna McClure, and
Speaker 11: it's of these three huge necklaces, one by Briany Raymond,
Speaker 11: one by Bell Parone and one by Retrovi and their
Speaker 11: gold their beads. There's one with these sort of plum
Speaker 11: colored calsenite beads and I feel like Kristen. First of all,
Speaker 11: these are very price upon request and very expensive, but
Speaker 11: it's the kind of look, right that could be reproduced
Speaker 11: all the way down to a J Crewe at some point.
Speaker 12: Oh yeah, I mean, you know, J Crew would always
Speaker 12: do those big beads, but the look will be different
Speaker 12: because it will be you know, plastic beads or beads
Speaker 12: covered by ceramic, not like these absolutely stunning gemstones. Yeah,
Speaker 12: I mean, you know, brass gold plated for sure, but
Speaker 12: I don't think you'll ever get quite that safe look,
Speaker 12: especially if you're a collector.
Speaker 1: Wait, we're not going to get the bib necklace. I
Speaker 1: really love the bib necklace.
Speaker 12: What is it?
Speaker 1: Nineteen seventy I mean that is so cool.
Speaker 9: M hmm.
Speaker 12: Yeah. So Briany she collects the State Jewelry and sells
Speaker 12: a really beautiful curation from her Manhattan showroom. And this
Speaker 12: piece is so stunning, you know, it could have been
Speaker 12: released today. You look at it and you're like, oh wow,
Speaker 12: that's from the nineteen seventies, and you really have no idea.
Speaker 3: Can we talk about price upon request for a second,
Speaker 3: because usually in Bloomberg pursuits we get prices, and I
Speaker 3: was surprised to see in the section this time, Kristen
Speaker 3: that there are a few instances where the price isn't there.
Speaker 3: It says price upon request. I'm requesting to know the
Speaker 3: price of these things. What's going on?
Speaker 12: Well, a lot of the times it's because they don't
Speaker 12: want to publicize this because they want to keep their mystery.
Speaker 12: But sometimes it's because they want to be able to
Speaker 12: negotiate with top clients. You know, if you buy XYZ,
Speaker 12: this will be a little less expensive, And they don't
Speaker 12: ever want to seem like they're getting this discounts because
Speaker 12: then clients will always express discounts. In the high jewelry world,
Speaker 12: it used to be you can negotiate on pretty much anything.
Speaker 12: So a lot of brands have pulled back on publishing
Speaker 12: prices so that they don't appear to be getting discounts
Speaker 12: even though they really are.
Speaker 3: So it's not famously if you have to add, I
Speaker 3: know this is grad but if you have to request it,
Speaker 3: then maybe you can because maybe it's negotiable. Yeah, well,
Speaker 3: apparently you do have to ask, Hey, we'll talk about
Speaker 3: men's jewelry a little bit, or did you want to
Speaker 3: talk about one else first?
Speaker 1: I just want to just give a few seconds, if
Speaker 1: you will, to the Greek jewelry designer that you guys like,
Speaker 1: spend a page talking about what's significant about this individual
Speaker 1: and what he's been doing.
Speaker 8: So.
Speaker 12: Nikos Coolis is an absolutely amazing independent Greek jewelry designer.
Speaker 12: He has a really defined aesthetic. If you're in the
Speaker 12: jewelry world, you look at a piece, you automatically know
Speaker 12: that it's Necos and I think that's really hard to
Speaker 12: do to stand out as a designer because there are
Speaker 12: so many independ the designers and a lot of what
Speaker 12: people are doing really looks the same. But he has
Speaker 12: a really unique vision. I love the way that he
Speaker 12: sets gemstones. There's a ring on the page, and instead
Speaker 12: of placing the diamond in the center, it's offset on
Speaker 12: the top. Same on the collar that you see on
Speaker 12: the bottom. This stunning emerald isn't set inside the necklace,
Speaker 12: it's set on top and above it, which is kind
Speaker 12: of unusual. You'd think you'd see it sort of dangling
Speaker 12: down like a pendant or set into the middle. So
Speaker 12: I just think it's really interesting what he does. He's
Speaker 12: at the top of his game right now. He's having
Speaker 12: tons of press, really having a moment with his high jewelry,
Speaker 12: and he's about to open two new boutiques in Athens,
Speaker 12: including a maid to Measure attelier for he crafts the
Speaker 12: most incredible pieces using really rare jumpstones.
Speaker 1: And Beyonce wore him recently for her Cowboy Carter tour,
Speaker 1: So yes, yeah, little props there.
Speaker 3: Speaking of having a d men's jewelry is having a moment,
Speaker 3: and we're not just talking about like that chain that
Speaker 3: Mark Zuckerberg wore a few weeks ago that people are
Speaker 3: talking about. That's not what we're talking about. Only did you.
Speaker 4: Hear, Chris?
Speaker 3: He said, only you would be talking about that. You're right,
Speaker 3: you know. At first when I started reading this, I
Speaker 3: was like, are they going to mention Zuck? And they did.
Speaker 3: So Chris talk a little bit about who's who's kind
Speaker 3: of at the forefront here.
Speaker 11: So I am at the forefront.
Speaker 3: I don't see jewelry right in that.
Speaker 9: I'm wearing a.
Speaker 3: Bracelet, Okay.
Speaker 11: I We in the section have been pushing jewelry for
Speaker 11: men for a long time, particularly brooches or pins, And
Speaker 11: over the past couple of years, you've seen on red carpets,
Speaker 11: especially Hollywood celebrities wearing men wearing tons of brooches. And
Speaker 11: then athletes, particularly NFL players, either when they show up
Speaker 11: for the draft or even before games or when a
Speaker 11: couple of them went to the met Gala, they wear
Speaker 11: statement necklaces, they wear rings, they wear bracelets, And this
Speaker 11: is trickling down to kind of regular guys who see
Speaker 11: these men and look up to them, and big jewelry
Speaker 11: companies are now getting into the business of what they're
Speaker 11: calling high jewelry, which isn't really hy jewelry. Hi jewelry
Speaker 11: is really like the big things that we were just
Speaker 11: talking about, but price on requests exactly, but more elevated
Speaker 11: stuff with eighteen care of gold with diamonds, expecting that
Speaker 11: men going forward are going to spend more money on
Speaker 11: jewelry and on like very noticeable, unsubtle jewelry.
Speaker 1: High design watches, Chris, that's a big thing.
Speaker 11: Yeah, So jewelry watches, watches with gemstones and kind of
Speaker 11: like avant garde designs have sort of been in the
Speaker 11: background in the watch world because sports watches are really
Speaker 11: big vintage watches, and this year kind of marked by
Speaker 11: a sale that Sotheby's did the of what they call
Speaker 11: rough diamonds, which were vintage high design, high jewelry watches.
Speaker 11: This has become a trend where both in the vintage
Speaker 11: market and at retail for new watches, people are really
Speaker 11: getting into kind of high design, really weird looking stuff,
Speaker 11: including this Cardier cuff, which is like is a bracelet
Speaker 11: that has two flat ends on one end has a
Speaker 11: watch and you can look at the time through the
Speaker 11: reflection on the other end, and there's just very cool, striking.
Speaker 1: Kristin, I mean watches, right, Like, I feel like we've
Speaker 1: gone through cycles with watches where they're practical, they're electronic,
Speaker 1: their technology, and then they're pieces of art again.
Speaker 12: Yes, I think that now that more women are collecting watches,
Speaker 12: brands are investing more in really beautiful, high jewelry watches.
Speaker 12: A lot of them have mechanical movements as well, so
Speaker 12: we're seeing, if you already have everything, what else can
Speaker 12: you have? And they're creating these watches that are really
Speaker 12: so striking, Like when you see them, when I saw
Speaker 12: a lot of them in Shanda, they really do take
Speaker 12: your breath away because you're wondering how they work, how
Speaker 12: do they get the mechanics in there, and they're just
Speaker 12: really stunning the way that they look at time. You know,
Speaker 12: if you have everything, what do you get a really
Speaker 12: wild watch?
Speaker 11: That should be our new Pursuits tagline. If you already
Speaker 11: have everything, what else?
Speaker 1: Think that?
Speaker 3: How about how about a one of a kind ultra
Speaker 3: modern necklace design that uses two crossing strands of eighteen
Speaker 3: carrot rose gold that end asymmetrically in bright ceramic swoops.
Speaker 12: Kristin, I love that necklace. So this is by tap In,
Speaker 12: a New York based jeweler known for using beautiful gemstones
Speaker 12: and colored ceramic in really unique and interesting ways. And
Speaker 12: this piece is incredible. It uses aquamarine and each one
Speaker 12: is about seventy five carrots, which is massive. You could
Speaker 12: never make a necklace with dim under emerald of the
Speaker 12: size because it would be you know, tens of millions
Speaker 12: of dollars if they even exist. So it's just really,
Speaker 12: really a stunning piece. If I ever saw anyone wearing this,
Speaker 12: I would fall over.
Speaker 1: It's gorgeous. I'm partial to aquamarines and it's off the charge.
Speaker 11: Queen has a really amazing tr with huge aquamarines because
Speaker 11: it's the collector. Christen said, they can be so big
Speaker 11: and they're so beautiful.
Speaker 3: It's one.
Speaker 11: It's one of my favorites.
Speaker 1: It's gorgeous. It's it's like looking in the ocean is
Speaker 1: what I love. All right, you got to go there, loafers.
Speaker 1: I feel like I could see them both on you,
Speaker 1: Chris and on you well not maybe two, but just quickly,
Speaker 1: let's wrap up with Twinkle for your toes.
Speaker 11: Yeah, we were thinking about you know what else, what
Speaker 11: else fits with this say goodbye to quiet luxury theme
Speaker 11: and bright colors and bold patterns and a big thing
Speaker 11: this summer is colorful loafers, penny loafers, you know, regular loafers,
Speaker 11: boat shoes, but with high quality like materials and cool
Speaker 11: crazy colors. And so we found really a bunch of
Speaker 11: great ones from Belgian shoes, from Ferragamo, from Taft and
Speaker 11: really like them.
Speaker 3: Come on, Tim, I'm just looking at him.
Speaker 1: Just looked at my looked at Chris's shoes.
Speaker 3: Chris, He's wearing very practical like I, you know, dropped
Speaker 3: my daughter off at school before I took the subway
Speaker 3: into work from Brooklyn shoes.
Speaker 1: But even Bass has a two tone color chechnicolor loafers.
Speaker 3: They're in this year, the end of quiet luxury.
Speaker 1: Carol, Kristin, are you in on two tone colored loafers
Speaker 1: or colorful loafers?
Speaker 9: Why not?
Speaker 3: Good answer?
Speaker 1: I love a little Papa color.
Speaker 2: All right.
Speaker 1: We gotta rap guys really fun stuff and as we
Speaker 1: kick off the summer, I really appreciate it.
Speaker 3: Hey, a big thank you to Kristin. Shirley Bloomberg's contributing
Speaker 3: Jewelry Ryder and founder of La Patiala, and to the
Speaker 3: editor of Bloomberg Pursuits, Chris Rouser.
Speaker 2: This is the Bloomberg Business Week podcast, available on Apple, Spotify,
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