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Speaker 1: Welcome to the Bloomberg Penl podcast. I'm Paul swing you

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Speaker 1: along with my co host Lisa brahma Witz. Each day

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Speaker 1: we bring you the most noteworthy and useful interviews for

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Speaker 1: you and your money, whether at the grocery store or

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Speaker 1: the trading floor. Find a Bloomberg Penl podcast on Apple

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Speaker 1: podcast or wherever you listen to podcasts, as well as

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Speaker 1: at Bloomberg dot com. Earlier this morning, we heard some

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Speaker 1: really interesting discussion uh with FED Chairman j Pale to

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Speaker 1: Peterson Institute talking about the impact of the coronavirus on

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Speaker 1: the economy, and Chairman Pal warns of a broad virus

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Speaker 1: danger and he certainly batted down any expectations of negative

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Speaker 1: rates out there, but certainly a somber longer term view

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Speaker 1: from the chairman to get a sense of kind of

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Speaker 1: what some of the details are there that we should

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Speaker 1: be paying attention to. We welcome Neil Dada ahead of

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Speaker 1: US Economics at Renaissance Macro Research. So Neil, thanks so

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Speaker 1: much for joining us. What was the key takeaway or

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Speaker 1: key takeaways for you from what we heard from Chairman

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Speaker 1: Pal this morning. Well, I think the most important takeaway

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Speaker 1: is that he's leaning into fiscal authorities quite hard. U.

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Speaker 1: He sounded pretty somber and um, you know, downbeat about

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Speaker 1: the outlook. In my view, I think he kind of

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Speaker 1: needs to do that. It's almost by design. If he

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Speaker 1: sounds upbeat, that takes the pressure off on the heat

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Speaker 1: off the ciscal authorities. If he sounds more negative, UM,

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Speaker 1: I think he keeps the pressure on them. So UM.

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Speaker 1: So to me, that, well, that's what was important. I

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Speaker 1: also thought it was quite interesting they talked about how

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Speaker 1: liquidity crises now can evolve into solvency problems later. Um. Again,

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Speaker 1: that sort of speaks to this idea that the less

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Speaker 1: they do now, the more pain there can be later.

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Speaker 1: So that kind of speaks to the sort of second

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Speaker 1: and third order effects from the initial shock um that

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Speaker 1: I think a lot of people are worried about right now.

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Speaker 1: So UM, I thought it was a pretty um you know.

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Speaker 1: I mean, like like I said, I think I think

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Speaker 1: he's negative. I think it's by design. Um. I think

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Speaker 1: I think it's important for fiscal um you know, for

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Speaker 1: our politicians to kind of um not declare victory too soon.

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Speaker 1: And in my view that means really two things. And

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Speaker 1: the most immediate term, UM, it means we need some

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Speaker 1: kind of a stay in local aid package. UM, you know,

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Speaker 1: from the federal government, you need to kind of backstop

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Speaker 1: the revenue shortfalls that states are seeing. And UM, I

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Speaker 1: think number two in the summer, when things presumably will

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Speaker 1: feel a little bit better than they do right now. UM,

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Speaker 1: we've kind of set up a cliff type scenario with

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Speaker 1: with respect to fiscal policy, because we're going to see

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Speaker 1: a robust unemployment insurance program evaporate for many millions of people.

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Speaker 1: And these are individuals in many cases that UM work

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Speaker 1: in industries like leaving, hospitality, retail that will be slow

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Speaker 1: to come back. UM. And they also have very high

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Speaker 1: propensities to consume. They usually spend what they get. So UM,

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Speaker 1: those are the two things I think on the fiscal

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Speaker 1: side that I'm kind of keeping an eye on right now.

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Speaker 1: And I think Powell's right to kind of say that, UM,

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Speaker 1: you know, while their costs to doing this, UM, the

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Speaker 1: benefits probably away the cost at this point. Neil, I

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Speaker 1: love speaking with you because when I sometimes feel gloomy,

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Speaker 1: you often bring an optimistic view to the table, and

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Speaker 1: I'm trying to find the optimistic view right now, especially

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Speaker 1: after fed Share Powells testimony. I know that this is

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Speaker 1: by design, but some of the statistics themselves all throughout

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Speaker 1: one among people who are working in February, almost of

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Speaker 1: those in households making less than forty tho dollars a

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Speaker 1: year had lost a job in March. Meanwhile, Stan druck

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Speaker 1: and Miller, the billionaire who has been very successful, said

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Speaker 1: that the risk reward calculation for equities right now is

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Speaker 1: the worst he's seen in his career. What do you

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Speaker 1: have to say about that? So? I think, Um, I

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Speaker 1: don't buy into this idea that the markets have priced

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Speaker 1: in some kind of of you know, glory V shaped

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Speaker 1: style of recovery and it's off to the races. Um.

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Speaker 1: I think that's sort of a red herring that people

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Speaker 1: are talking about. It's like everyone's looking for a V

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Speaker 1: shaped recovery except for me. You know, I don't. I

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Speaker 1: don't buy that at all. I mean, I think the

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Speaker 1: markets in the economy are more or less telling you

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Speaker 1: the same thing. We've done a reasonably good job of

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Speaker 1: clipping off the left tail rist scenario. I don't think

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Speaker 1: in L shape recovery is likely to happen on the

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Speaker 1: other end of this. At the same time, we've opened

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Speaker 1: things up a little, things have loosened a bit. Um.

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Speaker 1: The process is going slowly and gradually, and we've had

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Speaker 1: our initial bounce off belows and we're kind of treading water.

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Speaker 1: So I think the stock market and the economy are

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Speaker 1: more or less giving you the same message you asked

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Speaker 1: for something optimistic. There's always been somewhere Lisa, and um

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Speaker 1: and and and I'll tell you that. You know, it's

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Speaker 1: pretty obvious to me that the economy bottomed sometime in

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Speaker 1: the middle of April, meaning the level of activity isn't

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Speaker 1: getting any worse. If you look at specific sectors, loively, housing,

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Speaker 1: there's some evidence that things are reviving a little bit

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Speaker 1: more rapidly than originally anticipated. As an example, mortgage purchase

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Speaker 1: applications are up now four weeks in a row. This

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Speaker 1: preceded the sort of expiration of some of these formal

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Speaker 1: shels formal formal shelter in place orders, right, So, um,

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Speaker 1: the housing market recovery started even before these orders went,

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Speaker 1: you know, expired, and it's still recovering. It's up four

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Speaker 1: weeks in a row. Um, we've recouped about two thirds

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Speaker 1: of the loss since mid March. So um, that's that's

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Speaker 1: a surprise. Um, and it's you know, I mean the

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Speaker 1: fact that homebuying demand is picked up. I think it's

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Speaker 1: a it's a good thing, it's an interesting sign. So

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Speaker 1: it's something we're keeping an eye on. Yeah, Neil Data,

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Speaker 1: thank you so much for being with us as always. Uh,

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Speaker 1: it's always wonderful to get your perspective, Neil Data, head

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Speaker 1: of US economics at Renaissance Macro Research. And I will

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Speaker 1: tell you in the housing market, Paul, I wonder how

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Speaker 1: bifurcated it is with now on urban centers getting the

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Speaker 1: bulk of the purchasing right now. We hear so much

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Speaker 1: about this in Denise PELAGRENI was talking about this how

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Speaker 1: people are looking to get out of the city right now,

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Speaker 1: perhaps because they've been sheltering in place in a studio

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Speaker 1: or concerned about the density factor, but that seems to

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Speaker 1: be something persistent. I wonder if it's going to be

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Speaker 1: your diehard city personally, you're not considering leaving the city. Well,

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Speaker 1: I'm I'm born and raised here and I've lived outside

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Speaker 1: of the city, but you know, for for the time being,

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Speaker 1: I'm here, and it will be interesting to see how

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Speaker 1: the city transforms, especially if it gets cheaper for individuals

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Speaker 1: to live here. How that affects things especially, I'm not

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Speaker 1: going to get into it. Vanguard is known as the

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Speaker 1: firm that really pioneered the index fund, that really has

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Speaker 1: led the charge into passive investing. So it came as

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Speaker 1: a surprise to some people in February when it announced

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Speaker 1: a partnership with Harbor Vest UH Strategic Partnership to provide

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Speaker 1: qualified investors with access to private equity, which is decidedly

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Speaker 1: not indexible in the same kind of way as public equities.

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Speaker 1: The question is, then the world got turned on its head.

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Speaker 1: What is the opportunity now in private equity joining us now?

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Speaker 1: I'm so glad to say fran Can i Ree, principle

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Speaker 1: and global head of Private Investment at Vanguard frand thank

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Speaker 1: you so much for being with us. I would love

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Speaker 1: to start just first with how strong or weak demand

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Speaker 1: has been for private equity at a time when some

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Speaker 1: of the smaller businesses that these firms invest in are

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Speaker 1: getting incredibly challenged by the pandemic and related shutdowns. Oh yes,

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Speaker 1: thank you. And the supply coming in and the client

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Speaker 1: interests coming in continues, despite as you mentioned, the health

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Speaker 1: crisis and the market volatility. UM. I think a lot

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Speaker 1: of investors see the case for private equity UM. The

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Speaker 1: case also has extended in full and bear markets. So

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Speaker 1: private equity tends to be a replacement to public equity

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Speaker 1: or a compliment. And we've seen in other bear market

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Speaker 1: environments where private equity has held its own. So Frank

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Speaker 1: gives a sense of kind of the thinking behind at Vanguard. Again,

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Speaker 1: as Lisa was saying earlier, you guys are the big

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Speaker 1: giant player and indexing, and what's the thinking behind getting

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Speaker 1: into the private equity business. Yeah, thanks, Um. I think

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Speaker 1: most people may now mel us as indexing, but when

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Speaker 1: we started Vanguard, Jack Bogel started Vanguard, we started as

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Speaker 1: an actively managed shop and our first offerings were active

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Speaker 1: uh in nature. And so while we get very well

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Speaker 1: known for our indexing, I'm very proud of our indexing franchise.

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Speaker 1: We're actually one of the largest active investors on the

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Speaker 1: public equity side. We're also by far one of the

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Speaker 1: largest active managers on the fixed income side, both taxable

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Speaker 1: fixed income and tax exempts. So for us, we've always

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Speaker 1: been a very large, vibrant, active shop, and private equity

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Speaker 1: just extends that from the public markets. For the private

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Speaker 1: markets fran This was the rage heading into this crisis,

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Speaker 1: or right before it, where a vast amount of money,

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Speaker 1: record sums were flooding into private equity firms public private

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Speaker 1: debt funds, the idea being that public markets were still

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Speaker 1: flush with cash, that really the private markets were the

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Speaker 1: ones that still held opportunity. I'm wondering, though, liquidity and

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Speaker 1: solvency are different, and there are people who are saying

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Speaker 1: that private equity hasn't sold off to the same degree

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Speaker 1: that public markets have, but it's simply a function of

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Speaker 1: there not trading as much. Would you agree with that?

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Speaker 1: Do you think that private equity has seen the same

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Speaker 1: scope of declines, we just may not be able to

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Speaker 1: see them in the same way. Yeah, that's probably correct.

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Speaker 1: There's three maybe main components. One, you have appraisal based

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Speaker 1: valuation versus with the public markets are priced instant caneatives

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Speaker 1: for liquidity at that second, so it's the price that

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Speaker 1: will clear supply and demand. And whereas private equity is

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Speaker 1: a much longer duration investment, so the investors and the

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Speaker 1: investments themselves are much longer duration investments and they don't trade,

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Speaker 1: so a very small amount trades relative to its float,

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Speaker 1: which is very different from the public equity market. So, Frank,

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Speaker 1: give us a sense of kind of as you look

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Speaker 1: at the market today, it must be really difficult to

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Speaker 1: get a sense of where true value is. How are

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Speaker 1: you and in your team kind of trying to work

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Speaker 1: through that challenge. But the great thing for us at Vanguard,

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Speaker 1: we launched on March five, and so for us, it's

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Speaker 1: for us it's a new uh. So we actually have

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Speaker 1: no money in the ground, So we actually see this

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Speaker 1: as very opportunistic for Vanguard investors because we're not We

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Speaker 1: were not buying in November, December, January. We would have

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Speaker 1: if we were in the market, but we are entering

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Speaker 1: actually at a pretty good time because the valuations have reset.

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Speaker 1: So where are you seeing the potential opportunities here? So

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Speaker 1: we very much like our roots on the public equity

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Speaker 1: side and public fixed income side, are offering is going

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Speaker 1: to be very broad based, very global. Um will likely

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Speaker 1: have thirty to forty gps inside this offering, with seven

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Speaker 1: to eight hundred different holding companies, it'll globally diversified. I

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Speaker 1: don't want to interrupt you, Fran, but this sounds a

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Speaker 1: lot like an index fund of private equity is that

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Speaker 1: what it's aiming to be? Did we just lose frand

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Speaker 1: did he just hang off on that question He was saying,

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Speaker 1: I don't think so. I think we just lost him.

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Speaker 1: But that's sort of the question that some people have

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Speaker 1: is that are we going to end up getting some

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Speaker 1: sort of indexing factor among private equity funds and could

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Speaker 1: Vanguard's entrance into it be that. I mean, that's not

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Speaker 1: what he said. We didn't get his response on that.

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Speaker 1: We will have to have him back to discuss it,

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Speaker 1: because it is a really interesting point. In other words,

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Speaker 1: how much mainstreaming are you gonna end up seeing in

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Speaker 1: the private equity industry? Paul, Yeah, And you know some people,

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Speaker 1: you know, they see Vanguard and the likes of the Vanguards,

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Speaker 1: you know, get into private equity that say top of

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Speaker 1: the market when you know, as you were mentioning earlierly. So,

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Speaker 1: there's so much capital flowing into the private equity space

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Speaker 1: in the in the period before the pandemic, and there's

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Speaker 1: not that many places to find good deals, and we

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Speaker 1: saw this cash kind of piling up on the sidelines

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Speaker 1: and the question is is there too much cast chasing

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Speaker 1: too few deals? Uh? Pushing the prices up and returns down.

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Speaker 1: I think the days of getting I R are those

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Speaker 1: are certainly gone. And the questions can you get double

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Speaker 1: digit consistent returns in the private equity market? If anything, though,

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Speaker 1: Paul I will say that this downturn gives certain private

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Speaker 1: equity firms certainly raising funds now a better chance of

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Speaker 1: getting that I are going forward just given some of

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Speaker 1: the valuations. Yes, and I think we're seeing a lot

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Speaker 1: of money flow into a stress credit funds and uh,

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Speaker 1: you know, you really if you can do your credit work, Uh,

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Speaker 1: you know, certainly some returns there. So we thank fran

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Speaker 1: Fran Canary, principle and global head of Private Investments at Vanguard,

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Speaker 1: joining us here to talk about the private equity business

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Speaker 1: and the opportunities in a pandemic world. This is Bloomberg.

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Speaker 1: The people are starting to debate how this coronavirus and

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Speaker 1: the will change economic will change consumer behavior? Is it

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Speaker 1: changing consumer behavior and to what degree and across which

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Speaker 1: activities you know, people are you know, as it relates

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Speaker 1: to purchasing goods and services, people are doing more and

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Speaker 1: more of it online and then when they do, in

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Speaker 1: fact venture out to the stores, are they using more

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Speaker 1: or less cash, deborit cards, credit cards, all that type

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Speaker 1: of things. Fascinating to see how this pandemic will impact

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Speaker 1: consumer behavior going forward as we think about payments and

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Speaker 1: how we actually buy stuff when we're out in the stores. Uh.

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Speaker 1: We're really fortunate to have Lynda Kirkpatrick, President for the

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Speaker 1: U s issuers at MasterCard UH joining us. So, Lynda,

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Speaker 1: give us a sense of what you're seeing in terms

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Speaker 1: of the credit and debit card activity on your network.

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Speaker 1: How is consumer behavior changing? Thanks? Called, Well, we've seen

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Speaker 1: an increase in contactless payments in particular over the past

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Speaker 1: couple of months. And you know, the payments industry has

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Speaker 1: been investing in contact with capabilities for a while. So Linda,

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Speaker 1: sorry to interrupt, but you know, to find what is

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Speaker 1: contactless payments, because I find that it's much less prevalent

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Speaker 1: in the US than it is, saying Europe. Yeah, that's right.

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Speaker 1: Calls contactless is where you have technology that's embedded into

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Speaker 1: a typical credit or debit cards that allows a consumer

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Speaker 1: to tap their card at a terminal rather than inserting

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Speaker 1: it or swiping it and avoiding contact with the terminal altogether.

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Speaker 1: So it's using technology that prevents that contact with the

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Speaker 1: with the register and it's just the safe and secure

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Speaker 1: is every other product on the marketing fact that it

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Speaker 1: has the safest UH technology embedded into into the card.

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Speaker 1: UH and it's really a fast and easy way for

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Speaker 1: consumers to go about their day and their purchases UH

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Speaker 1: in general. So in with those with those payments, we've

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Speaker 1: seen them in crease over the past few months. UH

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Speaker 1: and and we believe this is a reflection of the

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Speaker 1: current environment. We wanted to really under better understand how

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Speaker 1: these consumer behaviors were changing and how we can support

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Speaker 1: consumers and merchants as we moved through uh COVID nineteens.

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Speaker 1: So we actually conducted a survey seventeen thousand people nineteen

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Speaker 1: countries around the globe and UH of those we've surveyed,

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Speaker 1: nearly of consumers say that they're now using some form

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Speaker 1: of contactless payments and they cite safety, health and security

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Speaker 1: reasons as as key drivers of that. And you know,

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Speaker 1: Mastercard's own data shows that our contactless transactions grew twice

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Speaker 1: as fast globally and three times as fast in the

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Speaker 1: US as non contactless transactions in grocery and drug stores

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Speaker 1: in particular. UH. So we are seeing arise in contactless

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Speaker 1: both here in the US as well as markets outside

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Speaker 1: the US. Even in our in our first quarter contactless

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Speaker 1: transactions group forty per cent. I'm wondering, Linda, how easy

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Speaker 1: it is to determine the shifts in the market right now,

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Speaker 1: given how many people are staying at home and aren't

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Speaker 1: spending as much, And if you could just speak to

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Speaker 1: the not spending as much aspect a little bit as well,

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Speaker 1: that might give people a sense of just how much

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Speaker 1: spending has contracted. Yeah, you know what we're seeing with

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Speaker 1: respect to consumer spending is it's really being focused in

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Speaker 1: the food and pharmacy areas. So people are still absolutely spending.

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Speaker 1: If you look at our transaction data and our purchase

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Speaker 1: volume data, we're seeing, uh, we're seeing spend and we're

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Speaker 1: seeing growth as of the end of the first quarter

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Speaker 1: and into the second, but we're seeing it very concentrated

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Speaker 1: in category that are everyday items and necessity items, and

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Speaker 1: certainly digital and e commerce transactions have grown exponentially as well,

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Speaker 1: So we've really seen a shift from uh, certain categories

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Speaker 1: to other categories. But we are seeing sustained periods of

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Speaker 1: spend and growth, and again, contactless Uh, ways to pay

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Speaker 1: are are really on the rise because it you know,

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Speaker 1: it's a product that lends itself to an environment where uh,

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Speaker 1: you know, the CDC and other health officials are encouraging

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Speaker 1: consumers not to come in contact with with cashiers and terminals.

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Speaker 1: It's it's really the rough product at the right time, Linda,

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Speaker 1: I'm wondering how difficult it is to get some of

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Speaker 1: the stores that you partner with to invest in contact

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Speaker 1: lists equipment now given their cash struggles. Yes, so the

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Speaker 1: good news is that most merchants in the US have

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Speaker 1: invested in contact with capability already. The upgraded the terminals

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Speaker 1: to accept ship several years ago, and at this point

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Speaker 1: we have six of our volume at MasterCard, actually close

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Speaker 1: to sixty happening at terminals that have contactless capabilities. So

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Speaker 1: acceptance by and large is is there. Uh. And we

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Speaker 1: actually had great commitments from are issuing financial institutions to

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Speaker 1: issue those contactless cards, and many of them now are

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Speaker 1: already in market. Uh. So we're now seeing the benefit

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Speaker 1: of that investment on the merchant side and the bank

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Speaker 1: side as consumers are using these products more readily. You know,

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Speaker 1: we wouldn't have anticipated when we started this journey UH

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Speaker 1: several years ago towards you know, chip and contactless that uh,

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Speaker 1: that we would have a pandemic that would make it

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Speaker 1: ever more relevant. But but certainly now we have the

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Speaker 1: health benefits in additions to safety and security benefits that

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Speaker 1: contactless spring. Linda Kirkpatrick, thank you so much for being

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Speaker 1: with US. President of US issue or as at MasterCard

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Speaker 1: based in New York, Well shares of grub Hub yesterday

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Speaker 1: searched as much as thirty nine percent after reports that

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Speaker 1: Uber was planning to buy the food delivery company grub Hub.

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Speaker 1: The question is a will it get through and be

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Speaker 1: What is the goal in the combination of both of

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Speaker 1: these companies joining US now as man Deep Singh, senior

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Speaker 1: tech industry analyst at Bloomberg Intelligence, So what would Uber

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Speaker 1: be looking to do with an acquisition of grub Hub. Sure,

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Speaker 1: so one of the things that they are targeting is

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Speaker 1: you know, positive even profitability. Obviously they set the goal

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Speaker 1: for for Q twenty. We don't think that's going to

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Speaker 1: happen even by the way, a whole lot of second,

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Speaker 1: I'm not letting you get away with that. Basically, they're

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Speaker 1: hoping to actually turn a profit at some point in

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Speaker 1: life while they were trying to. But I think they

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Speaker 1: were hit really badly with this COVID situation. Uh, Sadara

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Speaker 1: say his businesses recession proves, but it seems, uh, you know,

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Speaker 1: the volumes are done about fifty to sixt in core

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Speaker 1: ride sharing, and now it's a matter of can this

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Speaker 1: be a growth company? And investors are rethinking the whole

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Speaker 1: notion of you know, Uber having a long addressable market

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Speaker 1: where it can keep growing you know, every year. That

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Speaker 1: is out of the window simply because white sharing at

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Speaker 1: its core is declining, like I said, in volume, and

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Speaker 1: we don't know when it will come back. Yes, the

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Speaker 1: social distancing will be in effect for the foreseeable future,

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Speaker 1: and even if things open up, the volumes are not

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Speaker 1: going to come back right away. So we are talking

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Speaker 1: about desoleration of pronounced deceleration in top line. And I

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Speaker 1: think this is just an attempt to boost in organic growth.

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Speaker 1: So grub hub kind of gives them one point five

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Speaker 1: billion dollars in revenue, It helps them consolidate market share

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Speaker 1: and really lower cash burn. That's key because they were

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Speaker 1: losing fifty cents on every dollar of revenue in Uber red.

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Speaker 1: So this kind of at least helps them lure that

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Speaker 1: cash burn, which I think is extremely important given you know,

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Speaker 1: the concern around liquidity for both Uber and Left so

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Speaker 1: many deposition you know, acquisition, potential acquisition of growth hub.

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Speaker 1: Kind of a tacit admission that the core right sharing

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Speaker 1: business will not return to the growth rates it was

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Speaker 1: before the pandemic, that maybe consumer behavior will be permanently altered,

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Speaker 1: and one of the areas that may be altered. Is

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Speaker 1: this the whole concept of right sharing. I wouldn't call

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Speaker 1: it permanently altered, but I think for the foreseeable future,

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Speaker 1: right sharing isn't coming back to the historical levels we

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Speaker 1: have seen. And the fact that Uber is doubling down

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Speaker 1: on food delivery, which is a lower growth margin business

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Speaker 1: where they're losing money, just goes to show how desperate

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Speaker 1: they are to at least push that top line. Because

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Speaker 1: the last thing you want as Uber, you know, a

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Speaker 1: company that has got scale and network effects, is to

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Speaker 1: have you know, decline in top line growth. And that

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Speaker 1: is very much of a possibility if this doesn't happen,

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Speaker 1: because the core business is, like I said, declining at

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Speaker 1: least for the next two quarters. There's a question Mandy

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Speaker 1: it's a larger question about whether the sharing economy that

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Speaker 1: was touted by so many of these tech startups and

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Speaker 1: growth companies is dead in an era post pandemic. When

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Speaker 1: you talk to individuals and when you look at the

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Speaker 1: actual traffic at Uber and Left and how it's starting

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Speaker 1: to recover in places that might be exiting the lockdown.

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Speaker 1: There aren't many where Uber and Left have presents, But

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Speaker 1: just in terms of the path forward, what are you

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Speaker 1: hearing on that front? Well, so look at Airbnb and

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Speaker 1: you know pretty much everybody, uh you know on the

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Speaker 1: food delivery side is also part of the economy, and

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Speaker 1: I think they do serve a purpose at the end

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Speaker 1: of the day. They're all part of going digital and

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Speaker 1: you know, helping improve utilization. The problem is just the

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Speaker 1: cash burn. These business models are just not sustainable, and

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Speaker 1: I think what covid situation has done is really brought

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Speaker 1: the whole aspect you know of these companies just burning

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Speaker 1: through cash quarter after quarter, not even trying to generate

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Speaker 1: a profit. And really now the question is who can

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Speaker 1: hold on to the cash for long enough? And we

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Speaker 1: think Lift, for example, is really in a precarious situation

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Speaker 1: where they're burning about two million dollars of cash every

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Speaker 1: month and they have you know, about two point five

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Speaker 1: billion dollars in liquidity, so it just takes them up

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Speaker 1: to a year if the situation doesn't change. And I

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Speaker 1: think liquidity is really the main focus right now for

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Speaker 1: investors who can survive this period, which is at least

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Speaker 1: going to be you know, I believe sticks to a

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Speaker 1: twelve months if not, you know what, you know what

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Speaker 1: this feels like to me? It feels like people are

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Speaker 1: going to be paying a lot more to get the

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Speaker 1: food delivered. I think so, yeah, exactly, And and it

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Speaker 1: kind of goes to the point, uh, may man deep

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Speaker 1: as we compare Uber to Lift, which investors are are

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Speaker 1: wont to do? You know, lift that the Lift story

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Speaker 1: was were simplified, were core ride sharing? Uh? To the

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Speaker 1: extent that that business maybe permanently altered or maybe not

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Speaker 1: permanently but certainly significant offered over a longer period of time.

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Speaker 1: What's the feeling about the Lift story now? Is it

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Speaker 1: still the clear story or to still the one that

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Speaker 1: needs to diversify? Yeah, I think the diversification aspect is

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Speaker 1: clearly not being diversified is clearly hurting them right now.

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Speaker 1: And I will compare you know, Lift to somebody like Amazon.

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Speaker 1: You know, both Uber and Lift have been uh cutting costs.

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Speaker 1: They have been laying off employees. There is Zone is

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Speaker 1: hiring hundred house and employees. Both of them are doing

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Speaker 1: last mild delivery. So and and granted, uh, you know,

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Speaker 1: Lift is a more one sided business model where they're

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Speaker 1: just doing right sharing. But why can't they adapt? I'm

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Speaker 1: just kind of really baffled here that they weren't able to,

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Speaker 1: you know, offer grocery delivery quick enough to offset that

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Speaker 1: they decline in right volume. Why did they have to

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Speaker 1: just go in the towel and start laying off people.

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Speaker 1: And and I think their business model there kind of

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Speaker 1: premise all along was personal mobility and they haven't really fulcated.

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Speaker 1: This is just you know, a one dimensional company just

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Speaker 1: doing white sharing where they're they're supposed to have a

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Speaker 1: lot of data where they can anticipate the demand and adapt.

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Speaker 1: You know, they should have been able to do grocery

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Speaker 1: delivery too, delivery much more quickly than than they have.

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Speaker 1: And and that to me is surprising. Here Men Deep Seeing,

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Speaker 1: thanks so much for joining us. We appreciate you bringing

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Speaker 1: us up to date on Uber Grubhub, Lift and all

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00:26:05,840 --> 00:26:08,440
Speaker 1: that ride as sharing. Uh, it's going to be interesting

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Speaker 1: to see how this shakes out. Man Deep seeing senior

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Speaker 1: tech industry analys for Bloomberg Intelligence, and it's interesting. Lisa.

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Speaker 1: You know, I kind of was always joking with friends.

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Speaker 1: I just said, you know, Uber and Lift, the whole

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Speaker 1: ride sharing thing was one of the greatest inventions of

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Speaker 1: all time, never thinking that it would have to deal

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Speaker 1: with something like a pandemic and how that might you know,

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Speaker 1: really really alter the way people do some of these

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00:26:29,119 --> 00:26:34,040
Speaker 1: sharing activities like rides and or Airbnb. Yeah. I'm hesitant

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Speaker 1: to make sweeping characterizations or extrapolations from this moment because

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Speaker 1: the world changes when there is some sort of vaccine

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Speaker 1: and people feel comfortable going out and about that's you know,

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00:26:44,720 --> 00:26:47,399
Speaker 1: the big caveat here. Yeah, exactly, So we'll see. But

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Speaker 1: the you know, uh, Uber definitely dug doubling down on

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Speaker 1: that diversification to food delivery business to Uber Eats, with

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Speaker 1: potentially an acquisition of competitor grow Up. So will follow

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Speaker 1: that story as it develops going forward, along with Lee

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Speaker 1: so Bramo Wits. I'm Paul Sweeney and this is Bloomberg.

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Speaker 1: Thanks for listening to the Bloomberg pen L podcast. You

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Speaker 1: can subscribe and listen to interviews at Apple Podcasts or

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00:27:10,119 --> 00:27:13,119
Speaker 1: whatever podcast platform you prefer. I'm Paul Sweeney. I'm on

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00:27:13,160 --> 00:27:15,760
Speaker 1: Twitter at pt Sweeney. I'm Lisa Abram. Why it's I'm

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Speaker 1: on Twitter at Lisa Abram. Whit's one before the podcast.

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Speaker 1: You can always catch us worldwide. I'm Bloomberg Radio