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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg

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Speaker 1: Surveillance Podcast. Catch us live weekdays at seven am Eastern

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Speaker 1: on Apple CarPlay or Android Auto with the Bloomberg Business app,

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Speaker 1: Listen on demand wherever you get your podcasts, or watch

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Speaker 1: us live on YouTube.

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Speaker 2: He is absolutely unique as a president, president, former president, governor,

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Speaker 2: vice chairman and chairman of the FED, and that no

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Speaker 2: one in the multiple years I've been covering it synthesized

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Speaker 2: Wall Street business.

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Speaker 3: And economics like Robert Kaplan. He was at the Dallas

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Speaker 3: FED with a.

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Speaker 2: Real sense of the border political economics, the heritage of

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Speaker 2: the Dallas Fed around Robert McTeer and the Georgia School,

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Speaker 2: their research capabilities, and were thrilled he could join us

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Speaker 2: this morning for an extended conversation. It's been way too long, Robert.

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Speaker 2: Let me cut to the chase, the definitive series which

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Speaker 2: Jerome Powell speaks of.

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Speaker 3: Is the Dallas trim mean?

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Speaker 2: You are expert on that with your research staff. Does

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Speaker 2: the Dallas trim mean for Robert Kaplan? Does it indicate

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Speaker 2: a vector of disinflation or a new worry back to

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Speaker 2: the time of say Wayne Angel in a higher inflation rate.

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Speaker 4: It probably suggests inflation is a new word sticky, meaning

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Speaker 4: it's kind of going sideways.

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Speaker 5: And we're not making improvement.

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Speaker 4: And I would guess that if prices edge up a

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Speaker 4: little bit, it's going to be more supply side issues

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Speaker 4: from here than demand side issues.

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Speaker 2: What I'm looking at, Robert Kaplan, is the ambiguity, the swirl,

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Speaker 2: if you will, of American economics with our politics is

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Speaker 2: a sum total of what our listeners and viewers understand

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Speaker 2: on this Friday. Is it towards a depressed real GDP

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Speaker 2: because of policy uncertainty?

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Speaker 4: Yeah, So there are five big structural changes going on

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Speaker 4: that's very unusual and'll just tick off. We're restructuring the

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Speaker 4: way we do fiscal spending and it's going to have

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Speaker 4: some jarring effect, but we're going to have less fiscal spending.

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Speaker 4: If they succeed, that would tend to lower growth. We're

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Speaker 4: going to do a regulatory review in every industry to

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Speaker 4: try to produce more productivity growth that actually might be helpful.

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Speaker 4: There's going to be an effort to control the workforce. Obviously,

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Speaker 4: no more people coming in across the border entering the workforce,

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Speaker 4: and we're going to deport that tends to lower growth

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Speaker 4: unless we have an effort to revitalize legal immigration, and

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Speaker 4: then we're going to try to restructured the energy ecosystem

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Speaker 4: in this country to lower costs.

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Speaker 5: That's probably helpful.

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Speaker 4: And then the last thing is the tariffs, and the

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Speaker 4: tariffs have a price effect. But I would guess these

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Speaker 4: tariffs and the uncertainty with them on margin lower growth.

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Speaker 4: So you've got a bunch of cross currents, and I

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Speaker 4: would guess the net of it all is I would guess, yeah,

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Speaker 4: growth is probably slowing a little bit right now. And

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Speaker 4: the uncertainty as well as when you cut government spending

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Speaker 4: and you reduce workforce growth or you reduce the growth

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Speaker 4: of it, you know, you you limit GDP growth. The

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Speaker 4: effort is I don't know if that's that concerning, and

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Speaker 4: that I think the effort of this administration is to

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Speaker 4: try to create more organic, more private sector growth, less

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Speaker 4: government led growth, so quote unquote healthier growth, but top

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Speaker 4: line growth probably is going to be somewhat weaker, I

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Speaker 4: would guess, so.

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Speaker 6: Robert, giving that back in the five big structural changes

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Speaker 6: that you just outlined, if I'm the Federal Reserve, do

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Speaker 6: I just sit on the sidelines and kind of let

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Speaker 6: it all play out because the market is kind of

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Speaker 6: suggesting that the Fed's not going to do a lot

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Speaker 6: this year.

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Speaker 5: Yeah, yeah, I think the right thing.

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Speaker 4: Yeah, the FED is quietly drifting stage left, and that's okay.

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Speaker 4: The center stage is structural changes, executive branch changes away

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Speaker 4: from the FED, and in a period like this, I

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Speaker 4: think the wisest thing the FED could do, yes is

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Speaker 4: be comfortable standing pat be careful about what they say,

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Speaker 4: because I think commenting too definitively on how these structural

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Speaker 4: changes are going to play out, It's too early to

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Speaker 4: do it.

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Speaker 5: Tariffs is a good example.

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Speaker 4: We don't even know what the tariffs are going to be,

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Speaker 4: and so yeah, I think the FED will do less.

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Speaker 4: I think that's fine, and I think Jay pals Can

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Speaker 4: communication on that has been good recently, where he's made

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Speaker 4: clear we're in no.

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Speaker 5: Hurry and people should be prepared.

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Speaker 4: Their focus should be more on what's going on at

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Speaker 4: the executive branch. And second comment I'd make, if there's

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Speaker 4: a rate I'm focused on, I'm much more focused on

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Speaker 4: the ten year treasury rate than i am the FED

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Speaker 4: funds rate.

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Speaker 6: It interesting. So, Robert, as we sit back here, and

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Speaker 6: we think about the economic backdrop here, how do you

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Speaker 6: view the consumer right here? I mean, we've heard about

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Speaker 6: and talked about and noticed in the data this K

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Speaker 6: shaped economy.

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Speaker 5: How do you think about the consumer? There's two big groups.

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Speaker 4: It's confusing because there's two big groups. Probably unlike maybe

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Speaker 4: anything I've seen in my career.

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Speaker 5: There's one group.

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Speaker 4: That's sixty five that's rough numbers, sixty five seventy million

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Speaker 4: workers that make fifty five grand a year or less,

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Speaker 4: and they are struggling to make ends meet. They've lost

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Speaker 4: at least twenty five percent purchasing power. They don't tend

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Speaker 4: to own financial assets. That group is spending, but they're

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Speaker 4: watching every dollar they're going to McDonald's and they're agonizing

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Speaker 4: over even McDonald's trading down. That's sixty five to seventy

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Speaker 4: million workers and consumers. There's another sixty five to seventy

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Speaker 4: million consumers fifty five and older, own their home, have

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Speaker 4: a fixed rate mortgage, have financial assets, and this recent

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Speaker 4: period has been pretty good. Yes, there's infliction, but their

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Speaker 4: financial appreciation their financial assets is offset it.

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Speaker 5: And because their.

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Speaker 4: Mortgage is fixed, they're really not that sensitive to higher rates,

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Speaker 4: and they are spending much more aggressive. I guess aggressively

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Speaker 4: on services and other products. And that's why when you

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Speaker 4: see corporate earnings reports, it's confusing. Which of these two

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Speaker 4: groups are you serving. If you're serving that first group,

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Speaker 4: you're likely seeing a much more challenging business. If you're

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Speaker 4: serving the second group, you know business looks better to you.

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Speaker 2: Robert Kaplan with us, of course, the vice chairman of

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Speaker 2: Goldman Sachs, with farm Wearer's relationship with the Dallas Fed.

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Speaker 2: All sorts of academics through the year at his Harvard

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Speaker 2: were thrill these with us, and we said good morning

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Speaker 2: to you on YouTube in your home, at your office,

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Speaker 2: all of Golden Sacks tuned in on YouTube. I mean,

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Speaker 2: you know that's happening right now. Robert Caplan, I got

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Speaker 2: in the New Foreign Affairs last night. It's a very

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Speaker 2: strong issue, folks in these tumultuous times. Marianna Mazakata, who

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Speaker 2: Robert Caplan is not on the same page with the

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Speaker 2: esteemed left economist, huge economic history student Marianna Mazacato with

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Speaker 2: a wonderful essay on where we need to go. And

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Speaker 2: Robert Caplan, I'm sure you don't agree with all that

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Speaker 2: Professor Mazacata wrote up in The New Foreign Affairs. But

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Speaker 2: the one thing she talked about, you're the most qualified

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Speaker 2: person I know, is the financialization that we've seen in

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Speaker 2: the last ten, twenty, even thirty years, even before the

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Speaker 2: Great Financial Crisis. How do you explain the financialization of

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Speaker 2: the American culture and the winners you just described in

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Speaker 2: the millions of losers out there that are a reality.

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Speaker 4: Well, so I'll put it. I'll put it this way.

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Speaker 4: And you've heard me talk about this before.

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Speaker 5: I listen.

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Speaker 4: I work on an a firm now, and we run

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Speaker 4: a business, and I've run other businesses. Human capital is

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Speaker 4: the most important asset you have. And that's true for

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Speaker 4: the United States. It's true for the state of Texas

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Speaker 4: and so on. And early childhood literacy, secondary education, skills training,

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Speaker 4: a digital divide, allowing people to be more productive. That

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Speaker 4: is key to a growing middle class in building the economy.

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Speaker 4: And what we're seeing a little bit in the last

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Speaker 4: numberumber of years is a divergence financially between that I

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Speaker 4: just mentioned those two groups. Working people that don't take

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Speaker 4: government money have probably been employed, done everything right their

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Speaker 4: whole career, but they don't have a lot of savings.

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Speaker 4: They may not own their home, and they're reading in

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Speaker 4: the newspaper about another group of people out there who

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Speaker 4: are rising by bounds in terms of their financial wealth

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Speaker 4: and financial assets, and it seems like capitalism isn't quite

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Speaker 4: working for them. And I think education is one of

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Speaker 4: the vehicles to try to address this. But one of

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Speaker 4: the issues with decelerating workforce growth is education tends to

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Speaker 4: be paid for at the state level and city level.

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Speaker 4: If you're a growing city or state, you got the

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Speaker 4: money to spend on the getting affordable childcare, full day

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Speaker 4: versus half day, pre.

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Speaker 5: K, all these critical things.

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Speaker 4: But if you're in a state which is probably forty

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Speaker 4: plus states whose populations.

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Speaker 5: Are flat to down, you may not have the money.

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Speaker 4: And then philanthropy, which I'm actively involved in, can help

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Speaker 4: pick up the slack. But I think we should be

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Speaker 4: focusing more on our human capital and a little less

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Speaker 4: on financial end and.

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Speaker 2: Paul, that's the common ground between Mazocato and Kapitlin, no

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Speaker 2: question about that.

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Speaker 3: The individual education effort. Robert.

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Speaker 6: I know in your role as vice chairman of Golden Sacks,

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Speaker 6: who speak to CEOs around the world, what is their

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Speaker 6: view of I don't know the ability to take risk

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Speaker 6: to maybe think about M and A as a growth scenario.

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Speaker 6: Where are they in terms of how they feel about

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Speaker 6: their business and their ability to take risk over the

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Speaker 6: next couple of years.

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Speaker 4: Okay, So on the positive side, I think the prospect

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Speaker 4: of a more balanced regulatory environment, more cost benefit analysis,

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Speaker 4: more in their words, more sensible regulation.

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Speaker 5: They're okay with tough regulation.

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Speaker 4: But there has to be a rationale for it. I

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Speaker 4: think they're excited about that. On the other hand, they're

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Speaker 4: dealing with another They're dealing with the trade uncertainty. And

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Speaker 4: if you're going to domicile more manufacturing, for example in

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Speaker 4: the United States, you really need the corridor of Mexico

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Speaker 4: and Canada for integrated supply chains and logistics. And when

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Speaker 4: they see threat of tariffs on for example Mexico, which

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Speaker 4: they hope doesn't happen, which could undermine logistics and supply chains,

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Speaker 4: it gives them pause and makes them want to just

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Speaker 4: slow down a little bit and be more careful. And

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Speaker 4: the other big thing is AI and technology. Now, we've

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Speaker 4: had technology innovation for years, but if you're a CEO

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Speaker 4: right now, you've got to spend on AI in your business.

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Speaker 4: You're not sure which use cases will work and which won't,

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Speaker 4: but you got to do it. And so I think

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Speaker 4: you're going to see though a lot of merger activity

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Speaker 4: by companies who feel that, boy, if we're going to

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Speaker 4: take share in the years ahead, if we're going to

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Speaker 4: grow in the years ahead, we're more likely to have

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Speaker 4: to take share, and we're gonna have to size and scale,

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Speaker 4: and the ability to ford AI investment is more important

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Speaker 4: than its ever and I think you're going to see

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Speaker 4: a desire for many companies bigger to try to deal

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Speaker 4: with that.

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Speaker 3: I gotta squeeze this in too important.

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Speaker 2: There seems to be another threat happens every two, three,

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Speaker 2: five years. It's not specific to mister Trump on FED independence.

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Speaker 2: How does the institution of the Fed, mister Kaplan protect

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Speaker 2: itself and stay independent versus the McChesney Martin challenges decades ago.

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Speaker 5: Yeah.

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Speaker 4: So the thing that's always challenging at the FED, and

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Speaker 4: this isn't new, is regulatory provisory policy at the FED

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Speaker 4: is not politically independent and has not been politic independent.

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Speaker 4: The tilt of it changes, whether it's Obama to Trump,

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Speaker 4: then back to Biden, now back to Trump, and that

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Speaker 4: you'll see on setting the FED funds rate, though, and

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Speaker 4: the stance of monetary policy. I think it's critical of

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Speaker 4: this country that stay politically independent. Now the president can

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Speaker 4: jawbone and pressure and that's not new. May be more

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Speaker 4: intense right now, and the FED will do its job

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Speaker 4: and should to try to extent. They can't ignore that

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Speaker 4: make decisions only. The biggest threat to the FED, I

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Speaker 4: actually think sometimes is not from outside. Then you have

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Speaker 4: to be careful as a governor or a president. Don't

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Speaker 4: try to say things publicly you think might go over better,

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Speaker 4: or worry about the pressure.

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Speaker 5: Just do what you think is right.

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Speaker 4: And as long as they manage themselves, I think they'll

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Speaker 4: through this in an independent way.

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Speaker 3: Out of time. Robert Kaplan. Next time you're on, We're

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Speaker 3: doing a complete hour on do we need the docks?

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Speaker 2: Robert Kaplan of the Dallas Fed, always in forever and

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Speaker 2: now vice chairman of his Goldman Sacks.

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Speaker 1: You're listening to the Bloomberg Surveillance Podcast. Catch us live

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Speaker 1: weekday afternoons from seven to ten am Eastern Listen on

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Speaker 1: Apple Karplay and Android Otto with the Bloomberg Business app,

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Speaker 1: or watch us live on YouTube right.

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Speaker 3: Now on oil.

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Speaker 2: It has been too long, and she is definitive on

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Speaker 2: Saudi inc. As we have the joy in the honor

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Speaker 2: of speaking with Edward Morris a few days ago, now

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Speaker 2: in honor to speak with Ellen Wald. Ellen, what does

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Speaker 2: the Saudi royalty want besides one hundred dollars barrel oil?

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Speaker 2: What's their desire? Given the new hydrocarbon politics of Washington.

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Speaker 7: You know, it's interesting right now it seems like they

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Speaker 7: really want to broker peace between Russia, Ukraine and the

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Speaker 7: US or Europe. They're really pushing themselves as these you know,

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Speaker 7: kind of neutral peace brokers. Of course, it isn't all

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Speaker 7: so altruistic here, because with an end to Russia Ukraine

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Speaker 7: hostilities could come some very interesting developments from the oil market,

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Speaker 7: and you can be sure that the Saudis are all

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Speaker 7: about that.

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Speaker 6: Ellen, Just give us with some hindsight here, with three

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Speaker 6: years into this wark where and the sanctions associated with that?

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Speaker 6: Where does the Russian oil? Where has it gone? How

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Speaker 6: does it get into the marketplace these days?

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Speaker 7: Yeah, that's that's a really great question, because it used

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Speaker 7: to go all over the place, and it's.

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Speaker 8: Still it still goes.

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Speaker 7: It just really mostly goes to two places. Now goes

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Speaker 7: to China and goes to India. India is just open

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Speaker 7: this massive, huge market for Russian crude oil. And what's

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Speaker 7: so fascinating about it is their refineries have been benefiting

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Speaker 7: immensely from cheap Russian crude. They buy a lot of it,

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Speaker 7: and they process it and they make a lot of diesel,

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Speaker 7: and then they go ahead and they sell it to Europe.

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Speaker 7: And Europe is more than happy to buy this. I

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Speaker 7: kind of like call it laundered Russian crude because they

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Speaker 7: know where it comes from.

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Speaker 8: They know that it's Russian crude. But as long as

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Speaker 8: you know the origin of the diesel.

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Speaker 7: That they're using, says India and not Russia, they're more

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Speaker 7: than happy to buy it and keep their their you know,

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Speaker 7: supplies up and from this cheap Russian oil.

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Speaker 2: I took out a chart in Bloomberg today Ellen Wild

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Speaker 2: It's an inflation adjusted Saudi light and essentially on an

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Speaker 2: inflation basis is a generalization the price of a barrel

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Speaker 2: of oils where.

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Speaker 3: It was forty years ago.

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Speaker 2: Do we overplay in the media, Do we overplay in

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Speaker 2: our own minds, all of us, the listeners and viewers,

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Speaker 2: the importanttons of oil. Has it become inconsequential to the

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Speaker 2: public because of its cheapness.

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Speaker 8: So that's that's a really good, good question.

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Speaker 7: I think that we do overplay the importance of oil

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Speaker 7: in some respects. I know, we overplay it in when

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Speaker 7: we look at say the Saudi budget. So you know,

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Speaker 7: every year the IMF comes out with these these you

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Speaker 7: know stats and say, oh, the Saudis need x price

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Speaker 7: or a barrel of oil to cover their budget. And

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Speaker 7: the fact is that that is a meaningless statement because

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Speaker 7: that's not how it works in Saudi Arabia. You know,

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Speaker 7: a ramco sells oil and then a ramco you know,

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Speaker 7: makes money, and then they the Saudi government gets uh

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Speaker 7: you know, they get royalties, they get rents, they get dividends.

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Speaker 7: Now they get you know, it's not just that they

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Speaker 7: don't just get the money from the barrel. There's a

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Speaker 7: lot more that goes into it, and so things are

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Speaker 7: a lot more complicated now.

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Speaker 8: Of course, if you look even farther back than forty

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Speaker 8: years ago, you know, when oil was like to to

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Speaker 8: you know, something.

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Speaker 7: A barrel, and you realize that in you know, what

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Speaker 7: what Opek was fighting for in the nineteen seventies was

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Speaker 7: like to increase it to you know, a price of

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Speaker 7: like six something, and that was considered obscene.

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Speaker 8: You know, the request was considered absolutely obscene, you know,

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Speaker 8: and we.

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Speaker 7: Think about that now and it seems rather ridiculous. But

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Speaker 7: you know, when you do consider inflation and you do

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Speaker 7: consider what we're using oil now, I mean, look, natural

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Speaker 7: gas is becoming more expensive such that we're seeing a

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Speaker 7: lot of switching over to gas oil interesting from natural

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Speaker 7: gas right now, which is not good for the environment

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Speaker 7: to begin with.

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Speaker 8: But it's you know, so oil is still very very

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Speaker 8: much a very important and I would.

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Speaker 7: Probably say maybe the key role in uh, you know,

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Speaker 7: in terms of the hydrocarbrid spectrum.

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Speaker 2: Today, I get ten seconds. When do we get a

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Speaker 2: new book? It's all anybody?

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Speaker 8: Oh, that's a good question.

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Speaker 7: Not not anytime soon, you know, thinking maybe I should

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Speaker 7: write a TV script considering how successful Land went.

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Speaker 3: There you go. Would you like to weigh in on this?

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Speaker 3: Joe Tucker can wait?

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Speaker 6: Oh, I know everything about bring the land, man. I'll

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Speaker 6: tell you what that Getting oil out of a ground

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Speaker 6: that is serious business.

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Speaker 5: That's not an easy job. That's my deal.

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Speaker 3: Idiots like Paul Sweeney and Tom Kane. The closest I've

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Speaker 3: done is a gas station.

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Speaker 2: It was forty four cents a gallon, and I worked

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Speaker 2: at a gas station, so it's not easy.

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Speaker 6: I'm ready to be a Senior Fellow of the Atlantic Council.

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Speaker 6: Now that's how smart I am.

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Speaker 2: Paul Sweeney, oil expert Ellen wald D, thank you, senior

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Speaker 2: Fellow at Atlantic Council, the author of Saudi That Life.

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Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday

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Speaker 1: starting at seven am Eastern on Apple Corplay and Android

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Speaker 1: Auto with the Bloomberg Business App. You can also listen

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Speaker 1: live on Amazon Alexa from our flagship New York station,

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Speaker 1: Just Say Alexa Play. Bloomberg eleven thirty out of the.

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Speaker 2: University of Michigan, he has crafted out the most important

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Speaker 2: job in tech journalism.

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Speaker 3: Lukas Shaw, I mean it's sort of close. I mean,

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Speaker 3: you know, I mean loses if they're on fire. Mark

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Speaker 3: Kerman joins us in studio here in New York on

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Speaker 3: his ownership of the Apple story.

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Speaker 2: Mark where I am on this going back to like

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Speaker 2: I was one of the first people to see Lisa

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Speaker 2: and the failure of Lisa and a lot of the

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Speaker 2: early Max stuff is to me always in forever, what

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Speaker 2: the media misses and you don't miss it is chips.

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Speaker 2: I don't want to hear about Tim Cook. I don't

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Speaker 2: want to hear about stupid videos, launch and stuff.

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Speaker 3: I'm gonna butcher the name. Who is Johnny Shrugie?

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Speaker 2: Who's going to give us the A eighteen A nineteen

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Speaker 2: chip this fall in the new Apple iPhone.

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Speaker 9: Well, first of all, Tim, you did not butcher the name?

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Speaker 9: That is right?

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Speaker 3: I can't close.

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Speaker 9: No, no, you got it right. It's Johnny Srugie.

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Speaker 10: Okay, nice, you were spot on as always once a year.

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Speaker 10: Sugie is probably the most important executive at Apple other

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Speaker 10: than Tim Cook. I agree about why at this point,

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Speaker 10: with so much commoditization in the technology industry, Apple's unique

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Speaker 10: differentiator that makes their products better.

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Speaker 9: Than the rest is their chips.

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Speaker 3: Thank you.

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Speaker 10: It allows them to differentiate the designs. They can have

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Speaker 10: thinner form factors, better power efficiency, unique components that all

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Speaker 10: enable new features. For instance, the artificial intelligence capabilities that

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Speaker 10: everyone is talking about today. That support started to be

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Speaker 10: built into their chips in twenty seventeen.

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Speaker 2: Okay, I know you're not in speaking terms of say

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Speaker 2: Uber bowl like dan ives, but if you add a

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Speaker 2: cup of coffee with Dan Eves at Webbush and with

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Speaker 2: your journalistic abilities. Is the chip is there a constraint

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Speaker 2: or a limit to it on a mathematical basis? Is

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Speaker 2: Johnny Strujie and the rest are they going to get

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Speaker 2: to a limit where they can't get better in the

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Speaker 2: stock levels or goes down?

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Speaker 10: Well, I think in terms of performance you've seen drop.

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Speaker 10: There was a time ten eleven years ago where you

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Speaker 10: were getting one hundred percent, seventy five percent, fifty percent,

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Speaker 10: even twenty five percent year over year performance agains. That's

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Speaker 10: not the case anymore. At most you're getting ten to

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Speaker 10: fifteen percent performance gains. And that's due to a combination

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Speaker 10: of the engineering and Apple, but also their secret sauce,

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Speaker 10: which is their deep partnership with TSMC, which year after

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Speaker 10: year is able to improve their both production capacity and

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Speaker 10: their production technology.

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Speaker 3: And Bok.

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Speaker 2: My book of the year was Chipwark. It's fabulous book

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Speaker 2: about the history semiconductors. If you're at three nanometers, don't

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Speaker 2: you have a constraint towards two nanimeters.

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Speaker 10: Well, you're going to get to two nanimeters. Eventually you're

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Speaker 10: going to get to one nanometer, half a nanometer and

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Speaker 10: then even smaller than that. These production technologies are only

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Speaker 10: going to improve. The bottleneck, however, is that they need

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Speaker 10: to do two things at once. Right now they need

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Speaker 10: to walk and chew gum. They need to improve that

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Speaker 10: production technology. But at the same time, they're in the

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Speaker 10: middle of a move from bringing chip production out of

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Speaker 10: time one to other places.

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Speaker 9: Soon you're going to.

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Speaker 10: See Apple at full steam at a plant in Arizona.

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Speaker 10: They're going to eventually work on some plants in Europe.

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Speaker 10: So you're talking about having to do two things at once,

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Speaker 10: make your production technology better and move it outside of

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Speaker 10: Taiwan because they need the additional production capacity. But there

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Speaker 10: are real concerns geopolitically in terms of world affairs, in

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Speaker 10: terms of potential world disasters. Why would we put all

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Speaker 10: of our chips in one location. If Taiwan goes down,

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Speaker 10: Apple goes down so to speak, for a long time.

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Speaker 9: So that needs to be resolved.

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Speaker 3: And our knew digital distribution on YouTube.

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Speaker 2: Subscribe to Bloomberg Podcasts with us an extended conversation our

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Speaker 2: chief correspondent Apple and Technology Mark German Paul Hey Mark.

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Speaker 6: A lot of folks feel like with China, maybe not

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Speaker 6: the growth story for Apple that it used to be

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Speaker 6: that the company really needs to look to India in

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Speaker 6: a bigger way and they need a lower cost phone

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Speaker 6: arguably to do that.

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Speaker 9: Is this sixteen E?

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Speaker 6: Is that the phone that they introduced this week, Is

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Speaker 6: that maybe something that could be really competitive in a

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Speaker 6: market like India.

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Speaker 10: First of all, I want to add to what you

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Speaker 10: said about China. So China, You're right, it's no longer

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Speaker 10: a growth story, but it's I would say a decline

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Speaker 10: story at this point. Right we saw sales fall eleven

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Speaker 10: percent on an annual basis. They're about eight billion dollars

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Speaker 10: less a quarter in revenue than they were just a

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Speaker 10: couple of years ago.

443
00:24:22,040 --> 00:24:23,040
Speaker 9: Wow, in that region.

444
00:24:23,080 --> 00:24:26,639
Speaker 10: And this when Tim Cook became CEO, replacing Steve Jobs

445
00:24:26,640 --> 00:24:29,880
Speaker 10: in twenty eleven, that was really the number one priority

446
00:24:30,160 --> 00:24:32,720
Speaker 10: was making things work in China. In his first few

447
00:24:32,800 --> 00:24:35,520
Speaker 10: years there, there was some real innovation when it came

448
00:24:35,600 --> 00:24:38,600
Speaker 10: to the iPhone. They brought the bigger iPhone six and

449
00:24:38,640 --> 00:24:40,639
Speaker 10: six plus to China just a few years after he

450
00:24:40,680 --> 00:24:44,280
Speaker 10: became CEO, and at the same time he himself struck

451
00:24:44,320 --> 00:24:47,359
Speaker 10: a deal with China Mobile, biggest carrier in China, so

452
00:24:47,400 --> 00:24:49,639
Speaker 10: they had the twofold they had that fablet sized device

453
00:24:49,680 --> 00:24:53,200
Speaker 10: that everyone loves, right in addition to access to more

454
00:24:53,240 --> 00:24:56,040
Speaker 10: consumers than they ever had before, and so that was

455
00:24:56,280 --> 00:24:59,040
Speaker 10: like a lightning bowl for them. But since then they've

456
00:24:59,080 --> 00:25:01,520
Speaker 10: sort of petered out of little bit there. India is

457
00:25:01,680 --> 00:25:05,320
Speaker 10: very important. They believe they have very small market share there,

458
00:25:05,359 --> 00:25:07,879
Speaker 10: it's sub five percent. The way they see it is,

459
00:25:07,920 --> 00:25:10,720
Speaker 10: they have ninety five percent left to go after, right,

460
00:25:10,760 --> 00:25:13,160
Speaker 10: and I think they're slowly growing there, but they are

461
00:25:13,200 --> 00:25:17,040
Speaker 10: going to gain some steam there. Unfortunately, to your point

462
00:25:17,040 --> 00:25:20,959
Speaker 10: the iPhone sixteen e. With that device, they've abandoned the

463
00:25:20,960 --> 00:25:24,000
Speaker 10: budget market, but there are some little tricks and levers

464
00:25:24,040 --> 00:25:26,040
Speaker 10: they can pull. So you're going to have that six

465
00:25:26,160 --> 00:25:28,320
Speaker 10: hundred dollars starting price for the iPhone sixteen eight. But

466
00:25:28,359 --> 00:25:30,359
Speaker 10: what I think you're going to see is a bigger

467
00:25:30,359 --> 00:25:34,159
Speaker 10: push into clearance phones, so the older phones, refurbished phones,

468
00:25:34,240 --> 00:25:36,800
Speaker 10: and some of the older models that they don't advertise

469
00:25:36,840 --> 00:25:39,200
Speaker 10: on their website that they're going to keep pushing through

470
00:25:39,240 --> 00:25:42,119
Speaker 10: resellers in India. We may not hear about it here

471
00:25:42,240 --> 00:25:44,880
Speaker 10: in the States or in Europe, but in India they're

472
00:25:44,880 --> 00:25:46,639
Speaker 10: going to be selling those things through resellers.

473
00:25:47,000 --> 00:25:50,399
Speaker 6: So how does the company view China. Is this a

474
00:25:50,960 --> 00:25:54,040
Speaker 6: they're managing a declining business or is this something that

475
00:25:54,080 --> 00:25:57,600
Speaker 6: they think they can salvage bird Potentially.

476
00:25:57,160 --> 00:25:59,959
Speaker 10: I think the optimists in the company believe that they

477
00:26:00,200 --> 00:26:01,320
Speaker 10: can salvag it.

478
00:26:01,320 --> 00:26:02,600
Speaker 9: It's a real problem for them.

479
00:26:02,960 --> 00:26:07,040
Speaker 10: You have the slowed sales in China, you have the

480
00:26:07,080 --> 00:26:11,600
Speaker 10: current tariffs situations, you have the geopolitical concerns, and oh,

481
00:26:11,640 --> 00:26:14,200
Speaker 10: by the way, at the same time that thirty years

482
00:26:14,240 --> 00:26:16,679
Speaker 10: we spent building up the world's biggest supply chain, the

483
00:26:16,680 --> 00:26:20,280
Speaker 10: most intricate supply chain, entirely based or not entirely based,

484
00:26:20,280 --> 00:26:22,480
Speaker 10: heavily based in China, by the way, we're in the

485
00:26:22,480 --> 00:26:30,800
Speaker 10: middle of moving that to more places US, India, Thailand, Malaysia, Vietnam, Indonesia.

486
00:26:30,960 --> 00:26:33,320
Speaker 6: What's the timeframe for that for exact Like again, you

487
00:26:33,320 --> 00:26:35,919
Speaker 6: said thirty years to build up that supply chain that

488
00:26:35,960 --> 00:26:39,720
Speaker 6: really was centered around China. Is it a similar timeframe

489
00:26:39,800 --> 00:26:41,760
Speaker 6: to try to decouple itself from China?

490
00:26:41,960 --> 00:26:44,159
Speaker 10: Yes, I mean that took a long time to build,

491
00:26:44,520 --> 00:26:48,240
Speaker 10: and so they've been working on decoupling themselves from China,

492
00:26:48,920 --> 00:26:51,560
Speaker 10: starting already, you know, six seven years ago, right even

493
00:26:51,600 --> 00:26:54,080
Speaker 10: eight years ago, towards the beginning of the Trump administration,

494
00:26:54,760 --> 00:26:58,240
Speaker 10: COVID gave it increased prominence in importance, but this is

495
00:26:58,280 --> 00:27:01,800
Speaker 10: going to take a while. They've really moved the needle

496
00:27:01,920 --> 00:27:04,120
Speaker 10: in terms of moving out of China, and by the way,

497
00:27:04,200 --> 00:27:06,200
Speaker 10: I don't expect them to fully move out of China.

498
00:27:06,280 --> 00:27:09,520
Speaker 10: This is about augmenting and growing. So if they think

499
00:27:09,520 --> 00:27:11,679
Speaker 10: they're going to double their user base in thirty years,

500
00:27:12,080 --> 00:27:15,280
Speaker 10: you need more capacity. They've probably filled up what they

501
00:27:15,320 --> 00:27:17,440
Speaker 10: can do in China and they need other places to build.

502
00:27:17,200 --> 00:27:19,560
Speaker 2: The rest when the release comes out. You've been very

503
00:27:19,560 --> 00:27:21,800
Speaker 2: good about this, but the rest of the streets touchy

504
00:27:21,920 --> 00:27:27,480
Speaker 2: feely soft questions about product I go log the growth

505
00:27:27,600 --> 00:27:33,080
Speaker 2: of services and iPhone revenue and services is growing so

506
00:27:33,280 --> 00:27:36,760
Speaker 2: steady and so large, it's literally back to just pre

507
00:27:36,920 --> 00:27:41,320
Speaker 2: pandemic iPhone revenue. Do you in your reporting see a

508
00:27:41,440 --> 00:27:46,720
Speaker 2: true persistency of services growth to justify the bulk case?

509
00:27:47,359 --> 00:27:49,919
Speaker 10: Yes, you have to ask yourself, Tom, what would the

510
00:27:49,960 --> 00:27:52,879
Speaker 10: case be for Apple? How it investors feel about Apple?

511
00:27:52,920 --> 00:27:55,199
Speaker 10: What would be saying about Apple if it wasn't for

512
00:27:55,280 --> 00:27:56,200
Speaker 10: the service's story?

513
00:27:56,280 --> 00:27:58,800
Speaker 9: Right now? They knew about a decade ago.

514
00:27:58,680 --> 00:28:02,199
Speaker 10: That they needed to augment their device sales with a

515
00:28:02,240 --> 00:28:05,840
Speaker 10: new growth story, and that is services Apple TV Plus.

516
00:28:05,880 --> 00:28:08,760
Speaker 10: I think there's an opportunity as early as next year

517
00:28:08,840 --> 00:28:12,000
Speaker 10: or the year after to release an ad supported version.

518
00:28:12,520 --> 00:28:14,359
Speaker 10: And I'm not saying I'm the biggest span of the

519
00:28:14,400 --> 00:28:17,080
Speaker 10: content on Apple tv Plus, but they have a lot

520
00:28:17,119 --> 00:28:20,520
Speaker 10: of fans, and they have some absolutely terrific shows, and

521
00:28:20,600 --> 00:28:22,920
Speaker 10: I think they're making some money on the ten dollars

522
00:28:22,960 --> 00:28:25,840
Speaker 10: per month subscription. But once they do an advertising model

523
00:28:25,920 --> 00:28:28,720
Speaker 10: and get people hooked to more great shows, I think

524
00:28:28,760 --> 00:28:30,320
Speaker 10: that's going to be the real money maker for them,

525
00:28:30,320 --> 00:28:32,159
Speaker 10: and that's ads. I think ads is sort of the

526
00:28:32,200 --> 00:28:33,480
Speaker 10: secret lever they can pull.

527
00:28:33,720 --> 00:28:35,240
Speaker 9: I actually wrote a few days.

528
00:28:35,000 --> 00:28:38,880
Speaker 10: Ago that they're seriously considering bringing ads to Apple Maps.

529
00:28:39,120 --> 00:28:41,280
Speaker 10: Apple Maps is one of the most used apps on

530
00:28:41,320 --> 00:28:44,880
Speaker 10: the iPhone ecosystem. Don't forget two billion plus device is

531
00:28:44,920 --> 00:28:48,440
Speaker 10: strong there, So I think there's opportunities putting ads in

532
00:28:48,480 --> 00:28:50,920
Speaker 10: some places that could be a nice little growth story

533
00:28:50,960 --> 00:28:51,280
Speaker 10: for them.

534
00:28:51,600 --> 00:28:56,280
Speaker 6: Have we moved past the period where if you're an investor,

535
00:28:56,320 --> 00:28:59,880
Speaker 6: you're just an Apple observer, it's about the next product launch,

536
00:29:00,040 --> 00:29:02,080
Speaker 6: what's going to changing, what's be the next new thing.

537
00:29:02,120 --> 00:29:05,440
Speaker 6: Have we kind of moved past that? Is that we

538
00:29:05,480 --> 00:29:06,880
Speaker 6: are kind of where we are, and now we need

539
00:29:06,920 --> 00:29:08,240
Speaker 6: to think about other areas of growth.

540
00:29:08,520 --> 00:29:11,080
Speaker 10: I think investors need to move past that. I'm not

541
00:29:11,120 --> 00:29:13,600
Speaker 10: moved past it because I always will still see Apple

542
00:29:13,640 --> 00:29:15,960
Speaker 10: as the company that brings out major new products and

543
00:29:16,000 --> 00:29:19,360
Speaker 10: revolutionizes things. But I think with the Vision pro and

544
00:29:19,480 --> 00:29:22,520
Speaker 10: the AI push has showed us that they're not able

545
00:29:22,600 --> 00:29:25,320
Speaker 10: right now, or they don't have that magic formula to

546
00:29:25,360 --> 00:29:27,520
Speaker 10: bring out that major hit that is a game changer,

547
00:29:27,680 --> 00:29:32,160
Speaker 10: like the iPhone was, the iPad was, the Apple Watch.

548
00:29:32,120 --> 00:29:32,840
Speaker 9: Was to some extent.

549
00:29:33,240 --> 00:29:35,520
Speaker 10: And so this is a company that instead of coming

550
00:29:35,560 --> 00:29:37,520
Speaker 10: out with a new hundred billion dollars a year device,

551
00:29:37,880 --> 00:29:39,360
Speaker 10: they need to come out with a bunch of smaller

552
00:29:39,400 --> 00:29:41,400
Speaker 10: bets that add up to the revenue that would come

553
00:29:41,640 --> 00:29:42,920
Speaker 10: from a bigger bet.

554
00:29:42,920 --> 00:29:44,520
Speaker 9: So let me give you a few of those, give

555
00:29:44,560 --> 00:29:44,960
Speaker 9: me a few.

556
00:29:45,040 --> 00:29:49,280
Speaker 10: Okay, Robotics, that's going to be a big endeavor. Tabletop robot.

557
00:29:49,680 --> 00:29:51,600
Speaker 9: Right, it's a top robot.

558
00:29:51,680 --> 00:29:53,720
Speaker 10: Yes, So it's a smart home hub, a big iPad

559
00:29:53,800 --> 00:29:56,080
Speaker 10: like display on a robotic arm that moves around on

560
00:29:56,120 --> 00:29:58,680
Speaker 10: your desk and has a personality. Right, it's like a

561
00:29:58,760 --> 00:29:59,840
Speaker 10: companion in your works.

562
00:30:00,560 --> 00:30:03,160
Speaker 3: Can you get the seventeen year old to empty the dishwasher.

563
00:30:03,560 --> 00:30:05,400
Speaker 10: Okay, well you may not be able to get your

564
00:30:05,440 --> 00:30:07,520
Speaker 10: seventeen year old tempty the dishwasher, but you may one

565
00:30:07,600 --> 00:30:10,280
Speaker 10: day be able to get an Apple humanoid robot tempty

566
00:30:10,360 --> 00:30:13,320
Speaker 10: or dishwasher. And the humanoid is so interesting. I know

567
00:30:13,360 --> 00:30:16,120
Speaker 10: it sounds ridiculous, but this is where the industry is going.

568
00:30:16,400 --> 00:30:18,880
Speaker 10: Meta is starting a multi billion dollar division as of

569
00:30:18,960 --> 00:30:22,080
Speaker 10: last week to develop humanoid technology. They want to be

570
00:30:22,160 --> 00:30:25,480
Speaker 10: the Intel Qualcom Android of the robotics industry. I'm telling

571
00:30:25,480 --> 00:30:26,880
Speaker 10: you this is the next big thing.

572
00:30:26,960 --> 00:30:29,000
Speaker 2: Okay, but you told you and others told us about

573
00:30:29,000 --> 00:30:31,920
Speaker 2: the stupid Goggle thing that went down in flames.

574
00:30:31,680 --> 00:30:33,280
Speaker 3: What's what's a human robot?

575
00:30:33,280 --> 00:30:35,200
Speaker 10: I'm not saying it's not going to go down in flames.

576
00:30:35,240 --> 00:30:36,200
Speaker 9: I'm saying it's coming.

577
00:30:36,440 --> 00:30:38,120
Speaker 3: Okay, fair, fair, nice distinction.

578
00:30:38,280 --> 00:30:40,960
Speaker 2: Mark German continues with us, thrilled to have him in

579
00:30:40,960 --> 00:30:44,760
Speaker 2: our New York studios, usually a sconced on the Left coast.

580
00:30:44,800 --> 00:30:47,600
Speaker 2: Mark Herman, of course driving all of our Apple coverage

581
00:30:47,880 --> 00:30:53,360
Speaker 2: and definitive around the world for his voice on Apple News.

582
00:30:53,400 --> 00:30:55,960
Speaker 2: Of course, very quiet about his sources, as he should be.

583
00:30:56,400 --> 00:30:58,800
Speaker 2: I want to go to what nobody ever talks about anymore.

584
00:30:59,320 --> 00:31:02,040
Speaker 2: I remember, like you know, forget about the way back Max,

585
00:31:02,440 --> 00:31:06,560
Speaker 2: but I remember being an absolute awe of sixteen megabytes RAM.

586
00:31:07,040 --> 00:31:09,080
Speaker 2: We got M four. I guess I got M five

587
00:31:09,240 --> 00:31:12,000
Speaker 2: coming now. I got in my music thing at home.

588
00:31:12,000 --> 00:31:15,400
Speaker 2: I got a big Mac Pro sixteen. You know, the

589
00:31:15,440 --> 00:31:18,800
Speaker 2: thing's got bells and whistles on it. Do computers still

590
00:31:18,960 --> 00:31:21,680
Speaker 2: matter to them and do they want to put out

591
00:31:22,040 --> 00:31:28,440
Speaker 2: a cutting edge commuter computer still for Creative America, Creative Globe.

592
00:31:29,160 --> 00:31:32,600
Speaker 10: Oh absolutely. I think that they were more than think.

593
00:31:32,720 --> 00:31:35,040
Speaker 10: They were teetering on the Mac about a decade ago.

594
00:31:35,080 --> 00:31:38,640
Speaker 10: There was a multi year periodfare twenty fifteen twenty eighteen

595
00:31:39,000 --> 00:31:42,239
Speaker 10: where they weren't really coming out with redesigned computers. They

596
00:31:42,240 --> 00:31:45,760
Speaker 10: weren't doing frequent updates, and the problem was twofold one.

597
00:31:45,800 --> 00:31:48,640
Speaker 10: They believed maybe too heavily in the iPad right, the

598
00:31:48,680 --> 00:31:51,840
Speaker 10: iPad of the future. But then Intel they were really

599
00:31:51,880 --> 00:31:54,400
Speaker 10: a laggard, not doing a great job with their chips,

600
00:31:54,440 --> 00:31:57,000
Speaker 10: not bringing the performance gains Apple wanted. And then you

601
00:31:57,080 --> 00:31:59,880
Speaker 10: compared the performance of phones and tablets compared to what

602
00:32:00,000 --> 00:32:01,480
Speaker 10: you're getting from the Mac. In terms of year of

603
00:32:01,600 --> 00:32:05,040
Speaker 10: year efficiency improvements. They were in different worlds, but Apple

604
00:32:05,080 --> 00:32:08,160
Speaker 10: moving to its own silicon. You mentioned Johnny's RUGI five

605
00:32:08,240 --> 00:32:10,680
Speaker 10: years ago in the Mac that really changed everything for them.

606
00:32:11,120 --> 00:32:13,200
Speaker 9: It had sales skyrocket.

607
00:32:13,400 --> 00:32:16,560
Speaker 10: You know last quarter was n well, yes, well, in

608
00:32:16,600 --> 00:32:18,480
Speaker 10: the last quarter it was about fifteen percent year of

609
00:32:18,520 --> 00:32:20,720
Speaker 10: a year ago for the Mac. And so that was

610
00:32:21,000 --> 00:32:23,440
Speaker 10: very significant. And so I think they now have the

611
00:32:23,480 --> 00:32:26,920
Speaker 10: resources and the confidence to even double down on the Mac.

612
00:32:26,960 --> 00:32:29,040
Speaker 10: So what I think you're going to see, Well, you're

613
00:32:29,040 --> 00:32:30,640
Speaker 10: going to see new pro machines this year.

614
00:32:30,760 --> 00:32:31,120
Speaker 9: Creatives.

615
00:32:31,160 --> 00:32:33,120
Speaker 10: You talk about creatives, you'll get your new Mac Pro.

616
00:32:33,200 --> 00:32:35,040
Speaker 10: You'll get in your new Mac studio with the M four,

617
00:32:35,120 --> 00:32:37,560
Speaker 10: M five. They've now moved the MacBook program.

618
00:32:37,640 --> 00:32:39,680
Speaker 3: You're talking to missus Keane right now, keep it up.

619
00:32:39,840 --> 00:32:40,959
Speaker 9: Yeah, yeah, the MacPro.

620
00:32:42,360 --> 00:32:45,000
Speaker 10: Yes, Tom needs his new M five or M four

621
00:32:45,040 --> 00:32:48,680
Speaker 10: Mac Pro. The iMac will get another update. They've moved

622
00:32:48,680 --> 00:32:52,040
Speaker 10: the MacBook Pro, which is not their most popular machine,

623
00:32:52,480 --> 00:32:54,719
Speaker 10: but a really hot seller and really importance. What I use,

624
00:32:54,800 --> 00:32:56,400
Speaker 10: it's what I think a lot of people here use,

625
00:32:56,480 --> 00:32:58,840
Speaker 10: a lot of people in college and schools use. They've

626
00:32:58,880 --> 00:33:01,840
Speaker 10: moved that to an annual cycle every November, like clockwork.

627
00:33:01,840 --> 00:33:03,760
Speaker 10: You're getting a new MacBook Pro, just like you get

628
00:33:03,760 --> 00:33:06,120
Speaker 10: a new iPhone every year. So that is a really

629
00:33:06,160 --> 00:33:08,520
Speaker 10: big deal and I think is really important. MacBook Air

630
00:33:08,680 --> 00:33:12,320
Speaker 10: that's the most popular mac Okay, last updated.

631
00:33:11,880 --> 00:33:14,320
Speaker 9: A year ago. Here's a scoop for your show.

632
00:33:15,480 --> 00:33:18,080
Speaker 10: Apple's preparing to put the new MacBook Air M four

633
00:33:18,200 --> 00:33:20,400
Speaker 10: on sale in March, so next month, in just a

634
00:33:20,440 --> 00:33:23,560
Speaker 10: few weeks from now. They've started preparations, they've started sending

635
00:33:23,560 --> 00:33:26,600
Speaker 10: materials to their retail stores, they've ramped up production, and

636
00:33:26,640 --> 00:33:29,840
Speaker 10: they're nearly ready to go on the M four thirteen

637
00:33:29,880 --> 00:33:33,440
Speaker 10: inch and fifteen inch MacBook Air, your most popular machine,

638
00:33:33,480 --> 00:33:34,560
Speaker 10: just in a few weeks from now.

639
00:33:35,240 --> 00:33:38,880
Speaker 6: One hundred and fifty thousand employees, Is this still the

640
00:33:38,960 --> 00:33:40,040
Speaker 6: cool place to work?

641
00:33:40,480 --> 00:33:42,280
Speaker 9: If you're in this big question?

642
00:33:42,480 --> 00:33:43,280
Speaker 3: Well, good question.

643
00:33:43,400 --> 00:33:44,520
Speaker 9: I'll answer that in a second.

644
00:33:44,880 --> 00:33:47,080
Speaker 10: But I think the way that I would see it

645
00:33:47,280 --> 00:33:51,040
Speaker 10: is you're working at a place where you're impacting two

646
00:33:51,080 --> 00:33:52,280
Speaker 10: billion plus consumers.

647
00:33:52,360 --> 00:33:53,520
Speaker 9: Yeah, that's a good way to think about it.

648
00:33:53,560 --> 00:33:57,200
Speaker 10: Yeah, and you're influencing the products that you probably use

649
00:33:57,240 --> 00:33:59,160
Speaker 10: on a daily basis. So I think that's at least

650
00:33:59,160 --> 00:34:01,760
Speaker 10: what the company he sells to their employees in terms

651
00:34:01,760 --> 00:34:04,760
Speaker 10: of like the cool stuff in order to keep engineers

652
00:34:04,800 --> 00:34:07,120
Speaker 10: at a company who've been there twenty thirty years like

653
00:34:07,280 --> 00:34:09,719
Speaker 10: still like interested, you need to give him some moonshot

654
00:34:09,760 --> 00:34:12,160
Speaker 10: since so the vision pro was a moonshot. Interesting self

655
00:34:12,239 --> 00:34:15,319
Speaker 10: driving car was a moonshot, And so they probably kept

656
00:34:15,360 --> 00:34:17,960
Speaker 10: around people at Apple who wanted to leave them quite

657
00:34:17,960 --> 00:34:20,279
Speaker 10: a bit longer just by throwing them on these new

658
00:34:20,320 --> 00:34:23,640
Speaker 10: projects and just pushing them from new moonshot to new moonshots,

659
00:34:23,719 --> 00:34:26,680
Speaker 10: new special project group, the new special project group, instead

660
00:34:26,680 --> 00:34:28,520
Speaker 10: of having him, you know, flee to Google or Meta.

661
00:34:28,800 --> 00:34:29,040
Speaker 5: Yeah.

662
00:34:29,080 --> 00:34:34,560
Speaker 2: Tim Cook Auburn, nineteen eighty two, just get that in

663
00:34:34,600 --> 00:34:38,040
Speaker 2: there for Duke. Who's after Tim Cook? I mean we

664
00:34:38,040 --> 00:34:41,800
Speaker 2: were fixated by Iiger in Disney. I don't see people

665
00:34:41,880 --> 00:34:44,399
Speaker 2: fixated about who's after Tim Cook?

666
00:34:44,440 --> 00:34:44,880
Speaker 3: Should we?

667
00:34:45,120 --> 00:34:47,520
Speaker 10: You're seeing one person right now who's fixated on who's

668
00:34:47,520 --> 00:34:50,920
Speaker 10: after Tim Cook? Because I think it's a fascinating story.

669
00:34:51,400 --> 00:34:54,600
Speaker 10: He's been there around three decades at this point, he's

670
00:34:54,640 --> 00:34:57,480
Speaker 10: been in the job since twenty eleven. He's going to

671
00:34:57,520 --> 00:35:00,359
Speaker 10: be pushing sixty five next year. But then you look,

672
00:35:00,480 --> 00:35:02,600
Speaker 10: you look at this, right, you have Jamie Diamond, he's

673
00:35:02,600 --> 00:35:03,440
Speaker 10: in his late sixties.

674
00:35:03,520 --> 00:35:05,320
Speaker 9: Right, You've got Iiger, who's.

675
00:35:05,120 --> 00:35:07,480
Speaker 10: In his almost going to be in his mid seventies.

676
00:35:07,880 --> 00:35:10,200
Speaker 10: You know, there's a universe that Tim Cook could stick

677
00:35:10,200 --> 00:35:13,239
Speaker 10: around at Apple for a ball Biger like ten here.

678
00:35:13,600 --> 00:35:17,120
Speaker 10: Now you know Iiger took a few Michael Jordan like breaks,

679
00:35:17,200 --> 00:35:19,400
Speaker 10: you know, in between, so that's a little bit unique.

680
00:35:19,480 --> 00:35:21,520
Speaker 10: I think Cook's got you know, three to seven years

681
00:35:21,520 --> 00:35:24,040
Speaker 10: there left in the tank. Now you look at Apple's

682
00:35:24,040 --> 00:35:28,320
Speaker 10: executive team. Here's the problem. They're all in their mid sixties,

683
00:35:28,400 --> 00:35:30,880
Speaker 10: are going to be in their mid sixties, late sixties

684
00:35:30,880 --> 00:35:31,239
Speaker 10: by the.

685
00:35:31,200 --> 00:35:32,239
Speaker 9: Time Cook retires.

686
00:35:32,320 --> 00:35:35,799
Speaker 10: Right, You've only got one person on that executive team

687
00:35:36,080 --> 00:35:38,000
Speaker 10: who has the ability to step in there in five

688
00:35:38,040 --> 00:35:40,520
Speaker 10: to seven years be CEO and stick in the role

689
00:35:40,560 --> 00:35:43,359
Speaker 10: for a decade. That is mister John Turnas, the senior

690
00:35:43,480 --> 00:35:47,239
Speaker 10: vice president hardware Engineering. He's in charge of the device's business, right,

691
00:35:47,280 --> 00:35:49,840
Speaker 10: He's not an operations guy. Maybe he's not a business

692
00:35:49,880 --> 00:35:52,719
Speaker 10: guy or design guy, but he's the one in charge

693
00:35:52,760 --> 00:35:53,840
Speaker 10: of their money makers.

694
00:35:54,160 --> 00:35:56,040
Speaker 3: We're out of time. Are you going to come back

695
00:35:56,040 --> 00:35:58,040
Speaker 3: to New York scent? We can do it. We can

696
00:35:58,080 --> 00:35:59,680
Speaker 3: do it remote from Michaelson.

697
00:36:00,239 --> 00:36:05,080
Speaker 6: The LA office is phenomenal. It is Century City, extraordinary.

698
00:36:04,480 --> 00:36:07,960
Speaker 2: Shay German Mark germant On behalf of all of us

699
00:36:07,960 --> 00:36:09,240
Speaker 2: on team Bloomberg Surveillance.

700
00:36:09,280 --> 00:36:10,399
Speaker 3: Thank you so much for your work.

701
00:36:10,800 --> 00:36:13,640
Speaker 2: It is definitive to be at midnight and there'll be

702
00:36:13,719 --> 00:36:16,680
Speaker 2: some story out of Taipei or Singapore.

703
00:36:17,120 --> 00:36:18,160
Speaker 3: German says.

704
00:36:23,440 --> 00:36:27,360
Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday

705
00:36:27,400 --> 00:36:30,400
Speaker 1: starting at seven am Eastern on Apple Corplay and Android

706
00:36:30,440 --> 00:36:33,399
Speaker 1: Auto with the Bloomberg Business app. You can also watch

707
00:36:33,520 --> 00:36:36,440
Speaker 1: us live every weekday on YouTube and always on the

708
00:36:36,480 --> 00:36:37,920
Speaker 1: Bloomberg terminal.

709
00:36:37,560 --> 00:36:41,560
Speaker 2: Bloomberg Surveillance in our front pages at Lisa Mateo moment, Lisa,

710
00:36:41,600 --> 00:36:42,240
Speaker 2: what do you got?

711
00:36:42,400 --> 00:36:44,880
Speaker 11: Okay, we all know Ferrari right hot brand. But the

712
00:36:44,880 --> 00:36:47,200
Speaker 11: Wall Street Journal has this really interesting look into the

713
00:36:47,320 --> 00:36:50,600
Speaker 11: crazy economics behind why it's dominating.

714
00:36:50,239 --> 00:36:51,280
Speaker 8: The luxury car market.

715
00:36:51,760 --> 00:36:54,800
Speaker 11: So it's worth about ninety billion, but it only delivered

716
00:36:54,840 --> 00:36:58,440
Speaker 11: about thirteen thousand, seven hundred vehicles just over that. So

717
00:36:58,480 --> 00:37:02,320
Speaker 11: they call this business model based on scarcity because sometimes

718
00:37:02,320 --> 00:37:05,120
Speaker 11: they only offer like a few select vehicles to collectors,

719
00:37:05,120 --> 00:37:07,040
Speaker 11: and the collectors love it because they're part of this

720
00:37:07,239 --> 00:37:10,640
Speaker 11: elite club. And then while most cars lose value, some

721
00:37:10,680 --> 00:37:12,440
Speaker 11: of these like select Ferraris.

722
00:37:12,480 --> 00:37:14,200
Speaker 8: They keep their value, they gain value.

723
00:37:14,360 --> 00:37:16,319
Speaker 11: Like the hypercar in twenty thirteen it was like one

724
00:37:16,360 --> 00:37:18,960
Speaker 11: point four million dollars. It now fetches about three point

725
00:37:19,040 --> 00:37:22,040
Speaker 11: eight million dollars and they show it. It's similar to

726
00:37:22,080 --> 00:37:24,400
Speaker 11: like the air May's the Burke and bags. You know,

727
00:37:24,440 --> 00:37:28,319
Speaker 11: everyone wants a Burke and Bags and that they they say,

728
00:37:28,360 --> 00:37:30,879
Speaker 11: it's a similar kind of thing. You know, it has

729
00:37:30,920 --> 00:37:33,359
Speaker 11: this thing that everybody just wants them, and that's what

730
00:37:33,400 --> 00:37:33,759
Speaker 11: it is.

731
00:37:33,880 --> 00:37:35,920
Speaker 6: So here goes tom Thing. I've got something picked up

732
00:37:35,960 --> 00:37:38,839
Speaker 6: for you, the twenty twenty five Ferrari F eighty Okay,

733
00:37:39,280 --> 00:37:42,320
Speaker 6: list price three point seventy four million.

734
00:37:43,600 --> 00:37:45,680
Speaker 3: You got to be Sir Lewis's height to get into

735
00:37:45,680 --> 00:37:45,960
Speaker 3: the things.

736
00:37:46,120 --> 00:37:48,360
Speaker 8: Yes, that's why they don't have the session.

737
00:37:48,600 --> 00:37:50,719
Speaker 6: They would get into the Ferrari and the Lamborghinis the world.

738
00:37:50,719 --> 00:37:52,960
Speaker 3: I don't know how many over the Martin store and

739
00:37:53,040 --> 00:37:54,960
Speaker 3: Park Evan. Once they threw me out of the store,

740
00:37:56,920 --> 00:37:59,800
Speaker 3: they nice try next.

741
00:38:00,080 --> 00:38:03,160
Speaker 11: Okay, this one. You pointed out this out to me,

742
00:38:03,200 --> 00:38:06,440
Speaker 11: tom So, about how restaurants are charging like deposits or

743
00:38:06,480 --> 00:38:08,440
Speaker 11: minimum amounts when you have to make a reservation.

744
00:38:09,200 --> 00:38:10,080
Speaker 8: Well, I found a story.

745
00:38:10,120 --> 00:38:13,919
Speaker 11: Actually London is starting to do this because higher number

746
00:38:13,960 --> 00:38:17,640
Speaker 11: of cancelations, no shows. They're also saying it's because of

747
00:38:17,680 --> 00:38:20,759
Speaker 11: those bots and resale websites that are taking up a

748
00:38:20,800 --> 00:38:24,400
Speaker 11: lot of the reservations. Then they have the social media

749
00:38:24,440 --> 00:38:27,600
Speaker 11: influencers who want the free meal in order to post

750
00:38:27,640 --> 00:38:30,040
Speaker 11: a picture. So they're saying that they're charging like one

751
00:38:30,120 --> 00:38:32,880
Speaker 11: hundred dollars like per person as a minimum, and you

752
00:38:32,880 --> 00:38:34,640
Speaker 11: have to pay it when you book the reservation.

753
00:38:34,800 --> 00:38:36,040
Speaker 6: Reservation squatting.

754
00:38:36,160 --> 00:38:39,920
Speaker 11: Squatting, that's another thing. Yes, it's like multiple bookings and

755
00:38:39,960 --> 00:38:41,040
Speaker 11: you don't you only go to one.

756
00:38:41,080 --> 00:38:44,600
Speaker 2: Wonderful restaurant to South Madison. Amiranth, good morning to Ammerth.

757
00:38:44,640 --> 00:38:46,640
Speaker 2: We were talking to Libby Cantrell about the new Van

758
00:38:46,680 --> 00:38:50,320
Speaker 2: Clea store and they set over Amreth, great food, great launch,

759
00:38:50,320 --> 00:38:53,440
Speaker 2: blah blah blah, and Amorth told me it's the plague

760
00:38:54,360 --> 00:38:57,960
Speaker 2: and they're they're battling what to do about.

761
00:38:58,200 --> 00:39:02,640
Speaker 6: Let's the old day the restaurant. Yeah, like a reservation

762
00:39:02,800 --> 00:39:03,360
Speaker 6: two people.

763
00:39:03,560 --> 00:39:05,719
Speaker 11: Yeah, sometimes you have to wait in line. Actually you

764
00:39:05,719 --> 00:39:10,040
Speaker 11: can't even call them one more. Okay, Big Sports Media News,

765
00:39:10,080 --> 00:39:13,000
Speaker 11: Major League Baseball, Walt Disney's ESPN. They're ending the broadcast

766
00:39:13,080 --> 00:39:15,400
Speaker 11: relationship at the end of twenty twenty five, so we

767
00:39:15,440 --> 00:39:18,160
Speaker 11: talked about it. The league said, to the mutual agreement,

768
00:39:18,480 --> 00:39:21,480
Speaker 11: ESPN kind of scale back their baseball coverage because they

769
00:39:21,480 --> 00:39:25,480
Speaker 11: want to pay less. They did, so there's a lot

770
00:39:25,480 --> 00:39:26,600
Speaker 11: of ways to watch baseball though.

771
00:39:27,800 --> 00:39:31,279
Speaker 6: End up, ESPN is looking at its costs and saying, hey,

772
00:39:31,480 --> 00:39:34,400
Speaker 6: baseball is a regional sport, not a national sport or

773
00:39:34,400 --> 00:39:37,120
Speaker 6: a national network. So the costs aren't worth it for

774
00:39:37,200 --> 00:39:40,000
Speaker 6: us right now. So like everything else, Tom, it's going.

775
00:39:39,880 --> 00:39:44,279
Speaker 3: To streaming, Amazon, Netflix, whatever. Yeah, and you know you

776
00:39:44,400 --> 00:39:47,239
Speaker 3: they spend over one billion on James Bond. What are

777
00:39:47,239 --> 00:39:49,280
Speaker 3: they going to spend on the Boston Red Sox?

778
00:39:49,800 --> 00:39:51,799
Speaker 6: Anything they want. They can afford anything they want.

779
00:39:52,120 --> 00:39:53,319
Speaker 9: So yeah, so it's.

780
00:39:53,239 --> 00:39:56,160
Speaker 6: Gone to the regional streaming story.

781
00:39:56,200 --> 00:39:58,640
Speaker 3: Why are we sewing Yankee footage on YouTube?

782
00:39:58,920 --> 00:40:03,520
Speaker 9: Yes, there you go. What else would you show? Exactly?

783
00:40:03,640 --> 00:40:04,479
Speaker 9: What else would you show?

784
00:40:04,640 --> 00:40:06,560
Speaker 3: You know you want to go work for Mark Kerman. Hurry,

785
00:40:06,680 --> 00:40:09,480
Speaker 3: that's just too much. You don't want it. Thank you

786
00:40:09,560 --> 00:40:13,440
Speaker 3: are that's the last Yankee imagery we do, Lisa Mateo,

787
00:40:13,520 --> 00:40:16,120
Speaker 3: thank you so much. The newspapers. I will put it

788
00:40:16,160 --> 00:40:17,760
Speaker 3: out on Twitter and LinkedIn.

789
00:40:18,360 --> 00:40:23,200
Speaker 1: This is the Bloomberg Surveillance podcast, available on Apple, Spotify,

790
00:40:23,320 --> 00:40:27,600
Speaker 1: and anywhere else you get your podcasts. Listen live each weekday,

791
00:40:27,719 --> 00:40:31,200
Speaker 1: seven to ten am Eastern on Bloomberg dot Com, the

792
00:40:31,280 --> 00:40:35,319
Speaker 1: iHeartRadio app, tune In, and the Bloomberg Business app. You

793
00:40:35,360 --> 00:40:38,719
Speaker 1: can also watch us live every weekday on YouTube and

794
00:40:38,920 --> 00:40:40,640
Speaker 1: always on the Bloomberg terminal