Speaker 1: From Mahart where Innovation, Money and Power Collie in Silicon Valley, NBN.
Speaker 1: This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.
Speaker 2: I'm Caroline Heine, Bloomberg's and World sid quarters in New York,
Speaker 2: and I'm Ed Ludlow not in San Francisco, side by
Speaker 2: side for the last time this week, and this is
Speaker 2: Bloomberg Technology coming up.
Speaker 3: Look.
Speaker 4: Microsoft poised the clear it's final.
Speaker 2: Hurdle for its sixty nine million dollar takeover of Activision.
Speaker 4: Blizzard. We'll dig in.
Speaker 5: And the UAW expands its strike against GM and Sotlantis
Speaker 5: as talks progress with Ford.
Speaker 3: We'll give you those latest details.
Speaker 4: Plus iPhone fifteen.
Speaker 2: Hence the shelves around the world today we'll get the
Speaker 2: read on.
Speaker 4: The state of demand for Apple's new products.
Speaker 5: The UK Competition and Markets Authority is essentially green li
Speaker 5: now microsoft sixty nine billion dollar purchase of Activision. They've
Speaker 5: looked at the compromise, which is to sell cloud gaming
Speaker 5: streaming rights to Ubisoft, the Paris or French based video developer.
Speaker 5: Earlier on Bluemberg Television, we had the UKCMA CEO on
Speaker 5: to react to that decision.
Speaker 3: Have a Listen, the.
Speaker 6: Content creation remains with that division, but the ability for
Speaker 6: Ubisoft now to take independent decisions about how that content
Speaker 6: is the distributed through third parties. So we know sort
Speaker 6: of previously Microsoft control and limit the distribution channels for example,
Speaker 6: that doesn't happen. Now that's all within the unilateral control of.
Speaker 4: Ubisoft CMA CEO.
Speaker 2: There. Now let's dig into well the ongoing narrative of
Speaker 2: this story. Mark Bergen is standing by in London and
Speaker 2: I mean, we still got months to go until it's
Speaker 2: formerly green lit.
Speaker 4: But you think we can read the tea leaves that
Speaker 4: this is going to be good to go.
Speaker 7: I think my impression is that microsoftops by October eighteenth,
Speaker 7: so that's even less than a month. But you know,
Speaker 7: these things, as always are up in the air, and
Speaker 7: the regulatory environment, and certainly in the UK and Europe
Speaker 7: can be a little bit more unpredictable when it comes
Speaker 7: to tech.
Speaker 5: You know, Mark, at the beginning of the summer, I
Speaker 5: don't think anyone thought this deal was going to go through,
Speaker 5: and they overcame the regulatory hurdles here in the United States.
Speaker 5: Now the UK CMA was the final hurdle. What was
Speaker 5: the CMA's argument or commentary on why they felt Ubisoft
Speaker 5: was a good enough compromise.
Speaker 7: I think this is a really interesting concession, and from
Speaker 7: my understanding, it's like they're basically looking for a third
Speaker 7: party that's not Microsoft here that can be making these
Speaker 7: decisions around around cloud gaming. If you buy that the
Speaker 7: Microsoft thesis, and certainly like other companies like Google have
Speaker 7: tried and probably will continue to try in this world
Speaker 7: of cloud gaming. Having giving Microsoft it feels like giving
Speaker 7: Microsoft control of that. If you if you have Uboseelf involved,
Speaker 7: then you have this third party company, a French company
Speaker 7: that can sort of deny the ability for Microsoft to
Speaker 7: manipulate the market.
Speaker 2: Microsoft Bradsmith in particular comes out saying that they're still
Speaker 2: going to be working towards this October the eighteenth deadline,
Speaker 2: as you point out, Mark, But what a different environment.
Speaker 4: I mean, this has been a.
Speaker 2: Year and a half since they first wanted to get
Speaker 2: this ninety five dollars a shared deal done.
Speaker 4: What's changed?
Speaker 2: I mean, it's still the business basis remaining the same.
Speaker 4: Is it's still all about mobile gaming.
Speaker 7: My impression there's an armchair of political analysis here, which
Speaker 7: is that the CMA was sort of the only organization
Speaker 7: in the US in even the EU, which is typically
Speaker 7: sort of a much more willing to block these sort
Speaker 7: of deals, gave the green light. What's happening here in
Speaker 7: two months in London is the Prime Minister is holding
Speaker 7: this big summer around AI, this focus on AI safety,
Speaker 7: but also trying to build out the UK as at
Speaker 7: home to innovation and industry. I think it was certainly
Speaker 7: seen the messaging for Microsoft is that if the CMA
Speaker 7: blocks this deal, that is very counterproductive to the ultimate aims,
Speaker 7: and so that probably was maybe one of the factors
Speaker 7: in this redirection here. And I'm sure we've we've done
Speaker 7: some ex and my colleagues have done some excellent reporting
Speaker 7: on what went on behind the scenes here. We saw
Speaker 7: this morning that I think the activision price is now
Speaker 7: back to where it would have been initially paid, which
Speaker 7: just means a lot of lawyers made a lot of
Speaker 7: money in the past year and a.
Speaker 4: Half and they always mart Bergen, thank you very much. Indeed,
Speaker 4: go have a good Friday night.
Speaker 2: Meanwhile, let's talk about what's happening elsewhere in terms of
Speaker 2: relationships between private and public. UAW expanding its strike against
Speaker 2: the lantis En GM as I was just saying, Look,
Speaker 2: the un union, in fact has announced that it's made
Speaker 2: some real progress with Ford in talks over a new
Speaker 2: labor contract for more.
Speaker 4: Let's bring in Bluemos, Gabrielle.
Speaker 2: Coverla and Gabby, we will try and put the tech
Speaker 2: lens on this. And you did it so expertly last
Speaker 2: time to shining a light and how much ev transition
Speaker 2: is an issue for these car makers. What do you
Speaker 2: think is the part of why Ford's making progress here?
Speaker 8: Well, I think Ford traditionally has had a better relationship
Speaker 8: with the UAW than the GM or Stilandis. The company
Speaker 8: has said they spend about a billion dollars more on
Speaker 8: labor than GM Orsialandis, and I think a big part
Speaker 8: of that is they have fewer temporary workers. And that
Speaker 8: is a key difference because there is basically a second
Speaker 8: class of workers in America's auto plants, and that is
Speaker 8: these temp workers who you know, they start out at
Speaker 8: about fifteen seventy eight sixteen bucks an hour and they
Speaker 8: talk out at twenty whereas if you're a full time worker,
Speaker 8: you start out at around eighteen dollars. If you can
Speaker 8: talk about at thirty two dollars. So for in some ways,
Speaker 8: Ford was already there, but they are still making significant concessions.
Speaker 8: They agreed to cost of living allowances, basically inflation protection
Speaker 8: for the workers. That's something that went away in two
Speaker 8: thousand and nine of GM and Chrysler and bankrupt. Ford
Speaker 8: agreed to put it back. That was a major thing
Speaker 8: for the union. And also another key thing is the union.
Speaker 8: Sean Fay, the UAW president, said, for the first time
Speaker 8: in history, the union has won the right to strike
Speaker 8: over plant closures during the course of the four year contract.
Speaker 8: Now that's a big deal because if you think about
Speaker 8: the ev transition and the push for you know, lower
Speaker 8: cost and lower labor costs. You know, there's been a
Speaker 8: lot of new auto vans, you know, coming up to Mexico.
Speaker 8: People all three of these companies are making electric cars
Speaker 8: in Mexico, at least some of them, you know the
Speaker 8: books saying it's made in Mexico. RAM has some of
Speaker 8: their delivery vans electric being made in Mexico. So, I mean,
Speaker 8: the UAW, I think, sees the writing on the wall
Speaker 8: and they are really.
Speaker 9: Pushing hard to stop that.
Speaker 8: And with four they've made some progress. I don't know
Speaker 8: if they're going to be able to pull that off
Speaker 8: from gmrs. The land is but more in at a certain.
Speaker 5: Open Gabby Sean Fain's kind of big picture argument has
Speaker 5: been billions of dollars from the Inflation Reduction Act is
Speaker 5: going into the infrastructure. The companies can take that, and
Speaker 5: he's basically saying, like the labor has to go with it.
Speaker 5: You know, you have to you have to take some
Speaker 5: of that money and invest in the workforce long term.
Speaker 5: My question is, like net net, do evs require the
Speaker 5: same number of jobs on the assembly line as a
Speaker 5: combustion edging a combustion engine card does well, you know.
Speaker 8: There's been studies that suggest that no, you know, they
Speaker 8: do require fewer workers, especially when you think about you know,
Speaker 8: longer ready to make engines you know, or you know,
Speaker 8: some of the transmission that you see in a combustion echin.
Speaker 8: But you know, I would argue that we still don't
Speaker 8: have a really clear picture on that. You know, it's
Speaker 8: still early days in this, and there are you know,
Speaker 8: there are new jobs. We look at the billions of
Speaker 8: dollars in investments, you know, the companies are making to
Speaker 8: build battery plants in the United States, know, I think
Speaker 8: GM has talked about they're actually bringing more of some
Speaker 8: of their kind of powertrain work in house so they
Speaker 8: can have a place for union workers to go to
Speaker 8: and the EV transitions.
Speaker 4: The Lands has talked about that as well.
Speaker 8: The question is what kind of jobs will those EV
Speaker 8: jobs be, and that you know, that question is crucial
Speaker 8: to the u a W members. It's crucial also to
Speaker 8: our national politics. And you know you saw that, you know,
Speaker 8: former President Donald Trump has come in the Detroit next week.
Speaker 8: This morning, Sean Grain officially invited President Biden to come
Speaker 8: visit the picket line. So whether or not these future
Speaker 8: EV jobs are good jobs is critical not just to
Speaker 8: the UAW and you know, these workers stand there living,
Speaker 8: but also it's going to play It's going to be
Speaker 8: a huge issue in our you know, presidential elections for
Speaker 8: the whole coming years.
Speaker 3: It's just a huge topic.
Speaker 5: Bloomberg's Gota Coppola out there in Detroit. Just so good
Speaker 5: to have you here on Bloomberg Technology bringing us the
Speaker 5: breaking is coming out from the show. We're going to
Speaker 5: talk about the broader health of the tech sector with
Speaker 5: Denise Chishom Fidelity.
Speaker 3: I love having Denise on the show. This is Bloomberg Technology.
Speaker 4: What a week.
Speaker 2: Whether you're looking at the FED, whether you look at
Speaker 2: the UN, whether you're looking at IPO windows, but notably
Speaker 2: also whether you're looking at money being drawn out of
Speaker 2: the stock market. We're seeing the S and P five
Speaker 2: hundred having the most amount of funds come out since
Speaker 2: we understand in December.
Speaker 4: That's according to Bank of American Merrill Lynch.
Speaker 2: But let's dig into whether that's really coming out of
Speaker 2: the tech sector, whether it should be Denise Chisholmers with us.
Speaker 2: She's Fidelity head of Sector Strategy.
Speaker 4: Denise is great to.
Speaker 2: Have some time with you, and I'm just interested as
Speaker 2: to when we've seen quite a hard shell off in
Speaker 2: the last three days.
Speaker 4: Today we steady a little bit. What do you make
Speaker 4: of these valuations?
Speaker 2: What do you make of a NASDAC basically was almost
Speaker 2: an oversold territory or down at almost thirty.
Speaker 10: Yeah, when you look back at the short term volatility
Speaker 10: we're seeing now is exactly a surprise given a really
Speaker 10: strong rotation we've seen in the overall market and then
Speaker 10: obviously an economically sensitive sec like technology, So a little
Speaker 10: bumping around over the short term isn't really a surprise
Speaker 10: given the strength of that move. I think history can
Speaker 10: help a little when you sort of step back and
Speaker 10: zoom out. What's likely to happen in the future and
Speaker 10: not the past is one hundred percent predictive of future performance.
Speaker 10: But the stronger that cyclical rotation into economically oriented sectors,
Speaker 10: the more likely it is to continue. And the reason
Speaker 10: behind that is it's more likely that when stocks have
Speaker 10: moved as strange as it seems, when earnings are actually
Speaker 10: currently contracting, stocks more often than not get it right
Speaker 10: and earnings do in fact recover, and then the risk
Speaker 10: reward for those cyclical sectors like technology actually is still positive.
Speaker 5: Hey, Denise Carrot kick us off with let's play a
Speaker 5: game of technology risk factor BINGO.
Speaker 3: Because you read everything out, so you add the IPO window.
Speaker 5: We had China most recently the FED and then some
Speaker 5: economic data in the twenty four hours that followed that
Speaker 5: said the Fed's going to stay the course. What's BINGO
Speaker 5: for you? Like, what is the biggest fact that you're
Speaker 5: thinking about as it relates to tech.
Speaker 10: Yeah, I think it all has to come back to earnings,
Speaker 10: and that's the biggest factor one.
Speaker 3: Sorry, So that's my pick for.
Speaker 10: Bingo earnings, not any of that. I mean, I think
Speaker 10: that the FED. It's interesting when you think about interest rates,
Speaker 10: and I think people do think that they're very, very
Speaker 10: correlated to technology stocks. And it's not to say that
Speaker 10: they're not over short term periods. We obviously saw that
Speaker 10: in twenty twenty two. But when you think about interest rates,
Speaker 10: it's a very shifting correlation because the why behind higher
Speaker 10: rates matters more than the level. Meaning when rates are
Speaker 10: actually rising and growth is accelerating, then the technology sector
Speaker 10: and the stock market overall really has had little problem
Speaker 10: with higher rates. The problem comes in when you have
Speaker 10: higher rates and lower growth. Now that's where we were
Speaker 10: in twenty twenty two. So I think that you could
Speaker 10: be looking at a very changing correlation where rates and
Speaker 10: the FED were the only variable that you cared about
Speaker 10: as an investor in inflation to a situation where that
Speaker 10: might be more or less in the rear view mirror
Speaker 10: and earnings needs to be the focus because if earnings
Speaker 10: are going to recover, then interest rates and even valuations
Speaker 10: is much much less predictive when you look at history.
Speaker 2: What's so interesting is I'm interested in where you think
Speaker 2: earnings I mean, upon us till what October thirteenth, I
Speaker 2: was just immniant JP Morgan.
Speaker 4: They sort of.
Speaker 2: Tends to kick things off in the banking sector. Got
Speaker 2: a couple of weeks to wait, We've just had a
Speaker 2: name big in your town. Clavio come to the market,
Speaker 2: Boston born and bred and now publicly traded. It's now
Speaker 2: trading what at thirty two thirty three dollars versus its
Speaker 2: pricing point? But where do we look for the investment
Speaker 2: opportunities within technology because it all seemed to be about AI.
Speaker 4: At one point.
Speaker 10: Yeah, I don't know as much as it was about AIS.
Speaker 10: We certainly saw the move and the stocks. I mean
Speaker 10: that is more of a forward earnings story. And for me,
Speaker 10: when I looked at the historical pattern, as much as
Speaker 10: people were talking about it being all about five stocks,
Speaker 10: really the historical pattern that we saw in technology is
Speaker 10: fairly typical when you actually see an earnings contraction in
Speaker 10: the stocks move before earnings growth does. And that's the
Speaker 10: trickiest part about looking at multiples or looking at valuation
Speaker 10: to see if whether or not that this move is done,
Speaker 10: because more often than not, trough earnings is coincident with
Speaker 10: peak multiples, and that isn't a great predictive factor when
Speaker 10: you look at forward earnings. So the biggest moves that
Speaker 10: you have seen in the technology sector from a forward
Speaker 10: perspective when you're saying net revisions be positive, is in
Speaker 10: semiconductors and software, and I think that that's the area
Speaker 10: of the market that investors would qualify as expensive. And
Speaker 10: the problem with that expensive is that it's usually not
Speaker 10: a problem historically provided that earnings recover. Now there is
Speaker 10: valuation support within technology, and that's more in the hardware sector,
Speaker 10: so it's a little bit of a across the board.
Speaker 10: The catalysts are slightly different. So for valuation support, you
Speaker 10: actually don't have really the earnings momentum that other areas have.
Speaker 10: But the places you have earnings momentum, you don't have
Speaker 10: valuation support. But that isn't necessarily negative.
Speaker 5: Learning from the earnings window just gone. You know, you
Speaker 5: think about Video and Apple, what they had in common
Speaker 5: twenty percent of sales coming from China, and they both
Speaker 5: kind of were talked about in the context of long
Speaker 5: term risk China. What's happening politically but also technologically right
Speaker 5: access to technology markets. What does your research there tell
Speaker 5: you about the risk in China.
Speaker 10: Yeah, from a long term perspective, I think that we've
Speaker 10: had a lot of risks in a lot of sectors
Speaker 10: over a lot of years. I mean, what you can
Speaker 10: see when you look back in the historical data for technology,
Speaker 10: and we've got data going back to nineteen sixty two,
Speaker 10: is each cycle, margins have been higher and higher. Right,
Speaker 10: So this secular trend has been fairly consistent, which is
Speaker 10: not to say that there won't be risks in the market.
Speaker 10: And in some ways I'm the wrong person to ask
Speaker 10: that question, because what I really focus on is not
Speaker 10: all the things that could go and trying to discount
Speaker 10: that back to present or even future earnings. But really
Speaker 10: I concentrate around what is being discounted in the stock
Speaker 10: market because we've seen and even over the last year,
Speaker 10: we've seen this tricky scenario where stocks can advance quite
Speaker 10: rapidly despite the fact that there is bad.
Speaker 4: News and that's the wall of worry.
Speaker 11: Right.
Speaker 10: So when you think about risk from China, how do
Speaker 10: I as an investor know if that's a wall of worry
Speaker 10: issue or a real earnings hit. And I think, in
Speaker 10: some ways, instead of sort of trying to figure out
Speaker 10: whether or not it is is to think about what
Speaker 10: the stocks have discounted.
Speaker 5: Let's go from the wall of warry and end on
Speaker 5: a happy note. This Friday, Caroline talks about claviy. I
Speaker 5: just wanted to ask you about Boston and for you
Speaker 5: to have the opportunity to give a shout out to
Speaker 5: the tech sector in Boston.
Speaker 10: Yes, I will definitely give a shout out to the
Speaker 10: tech sector in Boston.
Speaker 3: All right, Well, that was short and sweet. We love it.
Speaker 5: Denise Chisholm, facility head of Strategy.
Speaker 3: Thank you.
Speaker 4: Caro yea, all eyes on. What a global text story.
Speaker 2: Meanwhile, let's just go over to what we've been seeing
Speaker 2: the home today. I cycled past the New York shop
Speaker 2: of course store as you might call it in America
Speaker 2: of Apple and the new iPhones.
Speaker 4: They're on deck, the launchers there. Tim Cook was in town.
Speaker 4: It was busy, The cues were enormous.
Speaker 2: What does that signal about ali appetite for these particular
Speaker 2: new phones.
Speaker 4: I phoned fifteen in particular.
Speaker 5: All right, time for talking tech and first up in
Speaker 5: the news Canio. The logistics arm of Ali. Barber's planning
Speaker 5: to file for its Hong Kong IPO as soon as
Speaker 5: next week that according to sources, this would make it
Speaker 5: among the first of the Chinese tech firms units to
Speaker 5: go public. The company's sargoning a raise of at least
Speaker 5: one billion dollars in the share sale, and the Biden
Speaker 5: administration is limiting expansion in China by chip companies getting
Speaker 5: federal funds to build plants. In the US, the announcement
Speaker 5: comes as the Chips Program Office is getting ready to
Speaker 5: give about thirty nine billion dollars in grants and seventy
Speaker 5: five billion dollars in loans and loan guarantees. Plus, Amazon
Speaker 5: will run ads on its Prime Video service in key
Speaker 5: markets to help offset rising costs. Following the example, of course,
Speaker 5: of other streaming platforms that are looking to further monetize
Speaker 5: their content. The company says AD supporting streaming will be
Speaker 5: the default on Prime Video in the US, UK, Germany
Speaker 5: and Canada starting early next year.
Speaker 4: Caroline, another one bites the dust.
Speaker 2: Meanwhile, the iPhone fifteen, those watches they officially went on
Speaker 2: sale today in the latest test for resilient consumer demand
Speaker 2: here in the US and globally, and it's all about
Speaker 2: Apple's devices. We're going to see how strong the start
Speaker 2: has been. Let's bring in Bloomberg's Mark German and Mark.
Speaker 2: I cycled on my way on my city BikeE passed
Speaker 2: the one right by Central Park today and the queues
Speaker 2: were enormous.
Speaker 4: That's typical though, right, Yeah, we're.
Speaker 12: Actually seeing lines that are a bit longer than we
Speaker 12: did the last few years. Obviously, we had a few
Speaker 12: pandemic years, so that sort of sucked the wind out
Speaker 12: of you know, lines at Apple stores. But clearly and
Speaker 12: seemingly the line are bigger than the past two years,
Speaker 12: based on everything we're seeing from Mumbai to Sydney to
Speaker 12: Japan to Los Angeles. Clearly there's a little bit more
Speaker 12: momentum here. I think some of the reason is maybe
Speaker 12: some of these people tried to pre order online but
Speaker 12: they were quickly meant with delays into mid November or
Speaker 12: even later in some regions, so they had no choice
Speaker 12: if they.
Speaker 13: Wanted one on day one to line up.
Speaker 12: But clearly there is a strong amount of momentum, at
Speaker 12: least for the new pro phones this year.
Speaker 5: So here's the questions, right, the holiday season's key, So
Speaker 5: do you frontload, do you buy it now or do
Speaker 5: you wait? And then we call it iPhone fifteen? But
Speaker 5: they're four handsets to choose from. Do they go Pro,
Speaker 5: Promax or Base model.
Speaker 12: Yeah, I think the Promax is actually especially important this year. Obviously,
Speaker 12: they removed the one hundred and twenty eight gigabyte tier
Speaker 12: that was the base tier for the phone in terms
Speaker 12: of storage, that was eleven hundred dollars. Now they're starting
Speaker 12: at twelve hundred dollars by eliminating that tier and starting
Speaker 12: with a two hundred fifty six gigabyte model, and that
Speaker 12: has additional functionality in addition to the bigger battery and
Speaker 12: the bigger display. This new five X zoom on the
Speaker 12: camera for the telephoto ones. So I think we're going
Speaker 12: to see more people than typical upgrade to that biggest
Speaker 12: size for that extra camera improvement.
Speaker 2: Mark great to have for your expertise, online lengths and
Speaker 2: everything else.
Speaker 4: We appreciate it.
Speaker 5: Welcome back to Bloomberg Technology. I'm and Dadlow here in
Speaker 5: New York City, one last day.
Speaker 2: Meanwhile, I'm karenin high Let's get a quick check on
Speaker 2: these markets on this Friday play day. We're seeing currently
Speaker 2: up a percentage point. Now's that one hundred managing to
Speaker 2: get a little bit of risk appetite creeping in towards
Speaker 2: the weekend. Now there aren't catalysts, whether it be some
Speaker 2: slightly weaker economic data that means the Federal Reserve could
Speaker 2: potentially hold for the rest of the year. Many are
Speaker 2: betting on at least one more hike. But for now,
Speaker 2: we get over the Federal Reserve hunt day and move
Speaker 2: towards actually been of buying in the ten year yield.
Speaker 2: We of course have been at high's for years on out,
Speaker 2: but we're currently at four point four point four let's
Speaker 2: call it. On the tenure, We're currently down by some
Speaker 2: six basis points, so a little bit of appetite.
Speaker 4: Having seen those yields push wider.
Speaker 2: I'm interested with the China story, though, Crane shares that's
Speaker 2: particular The next that I'm looking at up almost four percent.
Speaker 2: These are internet names in China that are traded over
Speaker 2: here in the United States and they get a bid
Speaker 2: because actually, maybe tensions are easing a little bit between
Speaker 2: US and China. There's going to be working groups discussions,
Speaker 2: particularly at the Treasury level, between the United States and China.
Speaker 2: Could that be easing some of the heated conversation we've
Speaker 2: been having of late.
Speaker 4: Move on to the individual movers PDD doing well on
Speaker 4: the back of that Meta platforms.
Speaker 2: Interesting by note coming from City as we look ahead
Speaker 2: to meta Connects next week and.
Speaker 4: I'm looking at Warner Brothers Discovery.
Speaker 2: Not a huge amount of news lines around warners today.
Speaker 2: We're down by some thirty percent worse performer on the
Speaker 2: last that one hundred. Maybe we look towards whether those
Speaker 2: striking actions, particularly between writers could be alleviated a little
Speaker 2: bit more on the state of discussions.
Speaker 5: Another favorite risk asset of choice of ours here on
Speaker 5: the program, of course, is biggwen. I just checked it's
Speaker 5: still at almost twenty seven US dollars for token. One
Speaker 5: of Europe's largest cryptocurrency asset managers, coin Shares, is actually
Speaker 5: looking to expand here in America with the launch of
Speaker 5: a hedge fund division. Fortunately with us on set talk
Speaker 5: through it all Gean Marie Magnetti Coinshares CEO. One would
Speaker 5: imagine that if you're launching a hedge fund here in
Speaker 5: the US, there is demand on the other side for
Speaker 5: such a such an offering.
Speaker 13: Yeah, thank you, thank you for having me.
Speaker 14: You know, we started our journey in Europe and we
Speaker 14: are as you mentioned, europe large asset management company in
Speaker 14: crypto and you know, the US remain ninety percent of
Speaker 14: the AUM allocation in the world, so you have to
Speaker 14: get enough FORRON in the US. We focus our started
Speaker 14: of our journey in Europe, and it's time for now.
Speaker 13: To bridge into the US.
Speaker 14: And we don't want to go into the US with
Speaker 14: our traditional ETF program or ETP program like we get
Speaker 14: in Europe and trying to find something different. Yeah, we've
Speaker 14: been training our dna is asset management and hedgephone business.
Speaker 14: We're doing community business before that in a hedge fund style.
Speaker 14: So we say it's time to go back to our
Speaker 14: roots and you know, offer the US market hedgepron offering,
Speaker 14: especially when everybody is living in the US. So what
Speaker 14: a better time to get in the US when everybody
Speaker 14: is exiting.
Speaker 2: Okay, so you're taking a sort of controversial.
Speaker 4: Move because people are exiting because.
Speaker 2: They're worried about regulation in particular perhaps people building their
Speaker 2: businesses elsewhere. We're looking at Gary Gensler really talking tough
Speaker 2: against the industry, what institutional clients, investors talk saying about this.
Speaker 14: So I'm not sure if it's controversial or contrarian. You know, yes,
Speaker 14: when we started our journey in twenty thirteen in crypto,
Speaker 14: I guarantee you we were very contrariant and people were
Speaker 14: telling us what are you doing? So it's kind of
Speaker 14: part of our gain in DNA to be doing this
Speaker 14: kind of move. You know, we're not building the hedgephne business.
Speaker 14: A hedgeprohn not based in the US are distributed and
Speaker 14: available for US investors, and that's very, very different. And
Speaker 14: you know, our game is like how do we bring
Speaker 14: this product and extend offering into the US. Our legacy
Speaker 14: product and never been distributed in the US, never been
Speaker 14: available to US investors.
Speaker 13: This is the very.
Speaker 14: First time now that we can bring this product to
Speaker 14: market to a US audience, and there is an appetite
Speaker 14: for that in the US. There is a lack of
Speaker 14: product availability in the US. You obviously get the GBTC availability,
Speaker 14: but beyond that, there's a few little number of players.
Speaker 14: So bringing a bit of a diversity and different view
Speaker 14: and different thinking is a great advantage.
Speaker 2: Is it generally going to be exposure to bitcoin and
Speaker 2: some of the clearly not expected to be deemed securities.
Speaker 7: Yes.
Speaker 14: First of all, this liquid, so everything we do is
Speaker 14: like one hundred percent liquid. We don't do like ten
Speaker 14: years vcphone in that approach. So it's like liquid investments,
Speaker 14: monthly redemption, monster subscriptions, so very very kind of easy
Speaker 14: to invest. And you know, at the end of the
Speaker 14: day you have to be able to follow as well
Speaker 14: market capital market market capitalization and liquidity. So so you know,
Speaker 14: we're going to really focus on bigcoon if mainly, which
Speaker 14: are like kind of the big timative we are seeing
Speaker 14: interest from.
Speaker 5: The thing is like the fundamental question whatever corner of
Speaker 5: the investing university in is what is the value of
Speaker 5: holding bitcoin in a portfolio from an asset allocation standpoint,
Speaker 5: or if you're a retail investor, what's your argument.
Speaker 14: It's a very interesting point because if you look at
Speaker 14: our start of our journey, we come into it as
Speaker 14: a deep deep value investor in Conciare with our coin
Speaker 14: share eye. So we started buying bitcoin in twenty thirteen
Speaker 14: seeing how it will transform and how a shock on
Speaker 14: the demand side will have an immediate effect on the
Speaker 14: price because the offer is constrained by code, constrained by
Speaker 14: low it's twenty one million, nothing else, and fir ust
Speaker 14: it was a very appealing process. I think that the
Speaker 14: narrative got lost a little bit in the meantime because
Speaker 14: of the speculation happening around crypto, and we can see
Speaker 14: now that the stats on chain and also off chain
Speaker 14: are showing that people are starting to hold to.
Speaker 13: Their bigcoin and not letting them go.
Speaker 14: There is a Concier research which come out this week
Speaker 14: where we can see that the amount of bitcoin all
Speaker 14: on chain for one year, not moving two years, three years,
Speaker 14: four years up to five years are not at an
Speaker 14: all time high. So people are starting to realize and
Speaker 14: go back to the real principle of bitcoinferenceance. It was
Speaker 14: a reserve, kind of a reserve of value, a way
Speaker 14: of us storing value for them for long term and
Speaker 14: not kind of just like a training asset.
Speaker 13: So it's a very interesting.
Speaker 14: Part for portfoliocation strategy and in our cent share model,
Speaker 14: want people to be able to come to us say okay,
Speaker 14: we want to allocate bitter with you, and if you
Speaker 14: want to go beyond bitter, you go to our Hochelon
Speaker 14: division and have an azone overlay or a complete alpha strategy.
Speaker 3: What was it like setting up the business here?
Speaker 5: I spoke to Chris Laston three weeks ago, the Ripple
Speaker 5: co founder who you know he is one of the
Speaker 5: biggest advocate advocates for the underlying blockchain technology has his
Speaker 5: own token. But he told me the basically, the FED
Speaker 5: Royal government and the FED and the Biden administration have
Speaker 5: killed the prospects through regulation in this country.
Speaker 13: So you know, a presence in the US.
Speaker 14: Since twenty seventeen, we have a broker dealer in the US.
Speaker 14: Since twenty eighteen, we have grown up this brocer dealer SOS.
Speaker 14: We can distribute our product which are effectively offshore products,
Speaker 14: so they are available for onshore investors. So the capacity
Speaker 14: to do it is very available in the US. That's
Speaker 14: to be done properly, done with the right people and
Speaker 14: in the right manner. And if you just go on
Speaker 14: this journey and accept to go on the journey and
Speaker 14: not say we're just going to do it the way
Speaker 14: we want, then there is a kind of a clear
Speaker 14: bone that we can follow.
Speaker 2: Can you tell us on your journey you're out here marketing.
Speaker 13: I'm sure I'm not marketing.
Speaker 2: You're out here having discussions about the offering that you're
Speaker 2: going to be attracting investors.
Speaker 4: Towards, of course, and therefore who are you.
Speaker 9: Speaking to you?
Speaker 14: I think that the people who are interesting if it's
Speaker 14: kind of offering. You know, nothing we're doing here is
Speaker 14: for retail. It's all a created investors, qualified buyer and
Speaker 14: more sophisticated investors. And you can see like an interest
Speaker 14: going from you know, our IEA at the bottom of
Speaker 14: the stack up to very sophisticated. That's a management company
Speaker 14: who are looking for sleevel diversification because it's not very
Speaker 14: easy when you are a multi billion dollar hedphone to
Speaker 14: just create a pocket of liquidity just for that. So
Speaker 14: it's like, how do I find the right partner to
Speaker 14: be able to go and allocate Jeh.
Speaker 2: Mary create test some time with you on your journeys
Speaker 2: across the America.
Speaker 4: I have a feeling I'll be.
Speaker 2: Back a few more times Jr. When yes, he's coinschaes
Speaker 2: at CEO. Meanwhile, we did have a little bit of
Speaker 2: breaking news and we just want to get you ahead
Speaker 2: of what's happening next week. We understand that well the
Speaker 2: FTC is poised to sue Amazon for a trust violations
Speaker 2: as soon as next week.
Speaker 4: That have been a report by Politico. This could come
Speaker 4: as soon as Tuesday.
Speaker 2: To keep a close eye on, of course, the ongoing
Speaker 2: regulatory environment.
Speaker 4: With which some of these big tech companies find themselves.
Speaker 5: Well, yeah, and I think Bloomberg's now reporting that the
Speaker 5: FTC is going to do this next week. And remember
Speaker 5: this is going after the online retail part of the business,
Speaker 5: the most sort of consumer facing bit. In our colleague Lyarlyland,
Speaker 5: I think she reported in the first week of September,
Speaker 5: so we thought this would come.
Speaker 3: But yeah, specific right coming up here.
Speaker 5: On Bloomberg Technology, we're going to talk about the future
Speaker 5: of climate tech and how AI can impact that sector
Speaker 5: its potential but also possibil drawbacks and then their impact ventures.
Speaker 5: Zoey Pedden joins us. Next, this is Bloomberg Technology.
Speaker 15: You need to have a dialogue with countries like China.
Speaker 3: They're not going to go away, and there may be
Speaker 3: things that we can work.
Speaker 15: Together with China on, but you know, we have to
Speaker 15: be very realistic and we have to have those.
Speaker 13: Discussions with our eyes open.
Speaker 15: What we're trying to see is if we can get
Speaker 15: a global consensusus on how to make sure that artificial
Speaker 15: intelligence remains a massive force for good in the world,
Speaker 15: which I truly believe it can be.
Speaker 5: That was UK Chancellor of the Exchequer Jeremy Hunt there
Speaker 5: and as world leaders gathered at the UN General Assembly
Speaker 5: in New York City this week, everyone seemed to agree
Speaker 5: on one thing. Climate change is among the biggest problems
Speaker 5: facing the planet. Maybe that's where AI could be a.
Speaker 3: Force for good.
Speaker 5: On today's VC Spotlight, we're taking a look at climate tech,
Speaker 5: investing the impact of AI on that sector and much
Speaker 5: more with Ananda Impact Ventures, a European VC firm with
Speaker 5: two hundred and thirteen million dollars under management. They're investing
Speaker 5: in startups with scalable missions for the plant its future.
Speaker 5: Let's bring in an and a partner Zoe Peddam for more.
Speaker 5: And you know Zoe, these meetings, these big, high profile,
Speaker 5: week long, let's talk about the world kind of events.
Speaker 5: As somebody invests in the early stage, do you see
Speaker 5: a trickle down of benefit from something like that.
Speaker 11: I think it's good to put the topic on the
Speaker 11: world stage. The media, like yourself at picking it up
Speaker 11: and talking about it, and it really helps the startups
Speaker 11: that are already working in it to get some momentum
Speaker 11: and get people talking about certain sectors that perhaps haven't.
Speaker 9: Received such media.
Speaker 11: As such a media exposure, there's been a lot of
Speaker 11: focus on carbon and carbon accounting, but what about biodiversity,
Speaker 11: what about nature? This is being put on the radar now,
Speaker 11: so I think it's important that we do have these
Speaker 11: meetings at this global stage.
Speaker 2: What's interesting, as we just heard from Jeremy Hunt, meanwhile,
Speaker 2: his leader of the Prime Minister of the UK is
Speaker 2: getting a lot of heat for basically putting climate goals
Speaker 2: to one side. And I'm interested in perspective of the
Speaker 2: politicization of the space in with you work. I mean,
Speaker 2: certainly that's here in the United States as well.
Speaker 4: Has there been as.
Speaker 2: Much interest in backing funds that want to invest in
Speaker 2: climate startups?
Speaker 11: I mean I was looking at pitch book the other
Speaker 11: day and it reported that in Q one twenty twenty three,
Speaker 11: climate tech startups raised five point seven billion, so two
Speaker 11: hundred and seventy nine BC deals, which is a thirty
Speaker 11: six percent decline in deal value and thirty one percent
Speaker 11: that decline in deal count from the previous quarter. But
Speaker 11: that's a lag indicator for me, because when I'm out
Speaker 11: there and I see when we're raising our fund and
Speaker 11: I meet people who want to invest in Nanda, I
Speaker 11: don't see this hesitation. I just see more and more
Speaker 11: money coming from many different areas coming into climate. So
Speaker 11: I think the dip in climate investing of that last
Speaker 11: quarter is just a general reflection of the dip in
Speaker 11: VC funding overall and not an indicator of where things
Speaker 11: are going.
Speaker 2: So let's talk about how you stand out from the crowd.
Speaker 2: At one point it felt like a very busy crowd.
Speaker 2: But what's interesting about Nandrew is you sort.
Speaker 4: Of put your money where your mouth is.
Speaker 2: And you don't take fees unless, oh, the companies which
Speaker 2: you're backing are saying what they're going to do, and
Speaker 2: you're holding yourself towards some sort of transparency account Here
Speaker 2: is that something that's been pipped by the rest of
Speaker 2: the industry.
Speaker 11: It's increasingly being copied and we wanted that. It's called
Speaker 11: our Impact carry model. We created it back in twenty
Speaker 11: fourteen alongside the European Investment Fund, so it's a co
Speaker 11: creation where the carry is linked to the impact.
Speaker 9: So we have impact KPIs and we need to meet at.
Speaker 11: Least sixty percent of those targets from those predictions from
Speaker 11: those startups to be able to see any carrier at all.
Speaker 11: So it means you really values align and the founders
Speaker 11: really like it, and of course our investors do. I
Speaker 11: think it's really important that we have something like this
Speaker 11: around accountability and governance in impact investing to stop impact washing,
Speaker 11: which you know you've got green washing, thank you've also
Speaker 11: got impact.
Speaker 3: Washing, Zoe.
Speaker 5: What is the AI climate play for avenged capitalists like you?
Speaker 9: Oh, there's lots of different things.
Speaker 11: I think the biggest area is in machine learning.
Speaker 9: That's what we've seen for the last few years. So
Speaker 9: going from.
Speaker 11: Looking at computer vision that's tracking had thermal cameras with nanosatellites,
Speaker 11: being able to detect and look at prevention of wildfire
Speaker 11: massive area, and then down to being able to predicting wastewater.
Speaker 11: Wastewater surveilance is a big new area in climate tech,
Speaker 11: and pathogens and being able to start to track different
Speaker 11: pathogens like the covid virus which is viral but actual
Speaker 11: bacterial ones, and being able to predict which areas might
Speaker 11: not respond to antibiotics, so antibiotic resistance is massive. So
Speaker 11: that's when you start to see the environment crossover into
Speaker 11: population health and then regenitive ag what else. Lots of
Speaker 11: things going on in ocean tech, very difficult area at
Speaker 11: the moment and biodiversity nature as I was referring to.
Speaker 9: Before, are wonderful. Wonderful.
Speaker 11: You are in much more tangible to talk about carbon
Speaker 11: and I think there's a lot we can do around
Speaker 11: being able to track nature using environmental DNA on the
Speaker 11: ground and being able to predict and.
Speaker 9: What species have been removed either through.
Speaker 11: Infrastructure or mining or something in the water, anything that's
Speaker 11: being dug up and replacing that and making it better
Speaker 11: than it was before.
Speaker 9: Because those little microbes, So it's.
Speaker 11: Not that the big species that you think about big animals,
Speaker 11: it's actually the microbes in the water. They leave trails
Speaker 11: of pieces of DNA and we can detect all of those,
Speaker 11: and they're the ones that when you talk about our
Speaker 11: food and our soil systems, they're absolutely essential for the
Speaker 11: balance that we have in nature, and those are the
Speaker 11: ones that.
Speaker 2: Are anander impact venture partner, Zoe Peden, thanks for spending
Speaker 2: some time with us, really tooking us through some of
Speaker 2: the opportunities there.
Speaker 4: So it's the Global Citizen Festival.
Speaker 2: It's become the world's longest running global campaign calling for
Speaker 2: an end to extreme poverty ever since its first installment
Speaker 2: here in New York City in twenty twelve. Now for
Speaker 2: this iteration, three million actions have been taken by global citizens.
Speaker 4: Where it's app to ask global.
Speaker 2: Leaders to defend the planet, to defeat poverty, to fight
Speaker 2: for equity. Now, as we gear up for twenty twenty
Speaker 2: three Global Citis Investival taking place tomorrow, to bring in
Speaker 2: Michael Sheldren, his chief Policy Impact in Government Relations officer
Speaker 2: over at Global Citizen. And we're going to put the
Speaker 2: weather to one side, because it might be a little drizzily,
Speaker 2: but ultimately you're fighting because of weather elements, because of
Speaker 2: the climate, because of poverty. And what's so interesting about
Speaker 2: Global Citizen And you were born in an iteration where
Speaker 2: people used to perhaps tweet, or they'd write letters, or
Speaker 2: they'd send emails. How have you used social media to
Speaker 2: now bring your force to bear?
Speaker 13: Well, thank you for having me on.
Speaker 16: And the first thing I will just say, if anyone's
Speaker 16: coming tomorrow, the Global Citizen Festival continues, rain, shining, hail,
Speaker 16: doesn't matter.
Speaker 13: Everyone will be there.
Speaker 3: And you're absolutely right.
Speaker 16: Around the world, extreme weather events are impacting the most
Speaker 16: vulnerable communities. But the way to think about the Global
Speaker 16: Citizen platform is, yes, people know us for our festivals.
Speaker 16: But inherently we're a digital platform and we camp having
Speaker 16: three hundred and.
Speaker 3: Sixty five days a year.
Speaker 16: People engage with our content and we're always finding ways,
Speaker 16: novel ways to meet people where they're at. So we're
Speaker 16: on TikTok, we're on Instagram, We're finding ways to engage
Speaker 16: people who may not even have access to Wi Fi
Speaker 16: in developing countries as well. And what we're seeing is
Speaker 16: record levels of engagement. Even as social media becomes more fragmented,
Speaker 16: we're actually seeing our citizens looking for a way to
Speaker 16: express their agency to take action, such as calling on
Speaker 16: the UK government to follow through on its commitments around
Speaker 16: climate financing.
Speaker 2: So where does Rischie Sunac, who at the moment perhaps
Speaker 2: is getting a lot of criticism for not really focusing
Speaker 2: on the climate agenda.
Speaker 4: How do you tackle him?
Speaker 2: Where are your citizens going to how you present your
Speaker 2: case to Rishi that he should care.
Speaker 16: So we have global citizens in every single constituency across
Speaker 16: the United Kingdom, for instance, And what we see, and
Speaker 16: this is mirrored around the world, is two thirds of
Speaker 16: people around the world are saying that they favor clean power,
Speaker 16: particularly solar energy, over fossil fuelds.
Speaker 13: Right so we're actually seeing.
Speaker 16: If you look at where people are at, it's an
Speaker 16: entirely centrist message and we believe that the UK government,
Speaker 16: especially with the Prime Minister's remarks over the last few days,
Speaker 16: is on the wrong side of history and global citizens
Speaker 16: have been calling him out. They've been contacting their local
Speaker 16: member of parliament, and we're also calling on the Labor
Speaker 16: opposition Sir Keir Starmer, if he's elected Prime Minister, to
Speaker 16: stand up and not backtrack because you need Britain. Britain
Speaker 16: has been a leader on climate change and through our
Speaker 16: digital platform, it's a way for citizens not just too
Speaker 16: whining and complying.
Speaker 4: About these issues about that online pop I.
Speaker 13: Know, I know, but we can take action.
Speaker 16: We can actually do something and the data shows when
Speaker 16: you do something that also gives us hope as well.
Speaker 5: You know, Michael, in the last time when I was saying,
Speaker 5: this is like live aid. But in the in the
Speaker 5: social media era, we talk so much on the show
Speaker 5: Carry don't we about the health of social media platforms
Speaker 5: right now? Knowing that what stands out is authentic, legitimate,
Speaker 5: you know, how do you feel about that? Do you
Speaker 5: feel that you are able to get a direct message
Speaker 5: out through the content that you're sharing.
Speaker 16: So live Aid Bono, Bob Godoff. We always say we
Speaker 16: stand on the shoulders of giants, but our evolution, we
Speaker 16: see action as our currency. So rather than selling tickets,
Speaker 16: you know, we could make a few million dollars, or
Speaker 16: we can give people away to take action. And people
Speaker 16: can take action on our platform and then take an
Speaker 16: action their crew points and as we see tomorrow at
Speaker 16: the Global Citizen Festival, they can exchange those points for
Speaker 16: rewards like tickets as well. But we see people they
Speaker 16: like to be rewarded for their action take in, but
Speaker 16: they also like to they also like to engage throughout
Speaker 16: the year as well.
Speaker 2: So obviously you employ, well you don't employ, but you
Speaker 2: stand on the shoulders the celebrities to get your message across.
Speaker 2: How do you navigate the politicization of these social media outlets?
Speaker 2: How do you decide or we're going to remain on
Speaker 2: Twitter now x even though there seems to be a
Speaker 2: blow up around now who owns it? Or indeed the
Speaker 2: direction of travel of TikTok so I think.
Speaker 16: You know a really interesting example is John Cook, right
Speaker 16: of BTS fame. You know, they're citizens and you can
Speaker 16: see the engagement going on. To be honest, they don't
Speaker 16: really care which platform. I think what you see, whether
Speaker 16: it's on Instagram or you see it on Twitter, you
Speaker 16: see record numbers of engagement in the issues. And when
Speaker 16: John Cook shares something about the issues on all of
Speaker 16: his platforms, you see people not just engaging with their
Speaker 16: content but also coming back to the platform to take action.
Speaker 16: And I think for them, it's not about being political,
Speaker 16: it's not about being left or right. Often the sentiment
Speaker 16: is around the issues, and I think what they see
Speaker 16: is they trust many of these influencers, trust these artists,
Speaker 16: and so I think what they're seeing is the artists
Speaker 16: being trustful custodians of the message.
Speaker 2: Michael Sheldrick bringing your message today. We thank you, Chief Policy,
Speaker 2: Impact and Government Relations Officer at Global Citizen, Kip and
Speaker 2: I on that rainfall, it happens rainl shine apparently. Now
Speaker 2: that does it for this a edition of Bluebook Technology
Speaker 2: and the I can't get my words.
Speaker 4: Out because you're about to leave.
Speaker 5: I know, I'm going to go back to San Francisco,
Speaker 5: but it's been good to be in New York.
Speaker 3: Greek at the show.
Speaker 5: We love that you guys are listening to the podcast apples, Spotify, iHeart,
Speaker 5: wherever you get your podcasts.
Speaker 3: Long week in New York City. What a week to
Speaker 3: be in New York City.
Speaker 2: Now, the listing to the pops, the fact that we're
Speaker 2: going to be analyzing how that continues to evolve next
Speaker 2: week