WEBVTT - Berkshire Hathaway Slashes Amazon Stake 0:00:00.240 --> 0:00:10.559 Bloomberg Audio Studios, podcasts, radio news. You're listening to the 0:00:10.600 --> 0:00:14.560 Bloomberg Intelligence podcast. Catch us live weekdays at ten am 0:00:14.600 --> 0:00:17.880 Eastern on Apple Coarcklay and Android Auto with the Bloomberg 0:00:17.920 --> 0:00:21.040 Business App. Listen on demand wherever you get your podcasts, 0:00:21.360 --> 0:00:23.560 or watch us live on YouTube. 0:00:24.400 --> 0:00:26.599 All right, we got to Scarlet Foot Paul Sweeney live 0:00:26.600 --> 0:00:28.720 here in our Bloomberg Interactive Broker Studio or streaming live 0:00:28.720 --> 0:00:32.600 on YouTube and at Bloomberg dot com. Buffett goes out 0:00:32.640 --> 0:00:37.479 like a bear with five billion dollars in Q four sales. 0:00:37.479 --> 0:00:40.640 That's according to the thirteen f's Matthew Palizola Joints is 0:00:40.680 --> 0:00:43.680 here senior alys who covers the insurance companies, including Berkshire 0:00:43.680 --> 0:00:47.480 Hathaway for Bloomberg Intelligence. He's covered that company for decades. 0:00:47.520 --> 0:00:52.239 Here was this the last quarter where Warren Buffett was 0:00:52.320 --> 0:00:55.440 actively managing maybe I guess the account along with his 0:00:55.520 --> 0:00:57.640 co managers there. So this is maybe the last time 0:00:57.840 --> 0:01:00.560 we can say Warren Buffett sold this or bought this. 0:01:00.720 --> 0:01:01.240 Yes it is. 0:01:01.320 --> 0:01:04.039 So he was the CEO as of the fourth quarter. 0:01:04.440 --> 0:01:06.920 So these moves that were looking at in the thirteen 0:01:07.080 --> 0:01:09.280 F took place in the fourth quarter. Of last year. 0:01:10.240 --> 0:01:13.160 To be totally fair, he's been stepping back. He probably 0:01:13.200 --> 0:01:15.440 wasn't behind a lot of this anyway, but this is 0:01:15.880 --> 0:01:18.640 actually the last quarter that you could even attribute these 0:01:18.640 --> 0:01:21.080 things to him. He remains chairman, so you never know 0:01:21.120 --> 0:01:23.880 he'd be looming behind the scenes, but his last quarter 0:01:23.880 --> 0:01:24.360 is CEO. 0:01:25.080 --> 0:01:27.520 And the thing about his husband in Apple was that 0:01:27.760 --> 0:01:30.160 he famously said he was only investing in things that 0:01:30.200 --> 0:01:33.520 he understood in that typically did not include technology companies. 0:01:33.840 --> 0:01:35.880 But Apple, I guess he saw more as a consumer 0:01:36.000 --> 0:01:37.120 company than anything else. 0:01:37.240 --> 0:01:37.760 Yeah, I think so. 0:01:37.880 --> 0:01:40.520 And I think the you know, his thing was motes, 0:01:40.640 --> 0:01:45.280 right and probably still is, but the iPhone mote and 0:01:45.319 --> 0:01:47.800 the infrastructure built in I think those were appealing things. 0:01:48.160 --> 0:01:50.600 They have been pairing that that investment, as we know, 0:01:52.000 --> 0:01:54.240 part of that, and you know, it's it's kind of 0:01:54.240 --> 0:01:56.160 a twist because he had said this said of the 0:01:56.160 --> 0:01:59.240 annual meeting a couple of meetings ago, that it was 0:01:59.760 --> 0:02:01.880 a kind of tax reasons that they had these huge 0:02:01.960 --> 0:02:04.920 unrealized gains in there, and he thought taxes. 0:02:04.560 --> 0:02:05.400 Would be going up. 0:02:05.560 --> 0:02:07.640 Now they're certainly not going to go up under the 0:02:07.640 --> 0:02:10.720 current administration kind of anytime soon. But Buffett is always 0:02:10.720 --> 0:02:13.160 long term thinking, so I think that's what he was 0:02:13.200 --> 0:02:15.880 looking at as we've got, you know, tens of billions 0:02:15.880 --> 0:02:18.200 of dollars of unrealized gains that will be taxed. And 0:02:18.520 --> 0:02:21.959 I think it does still hold true that in ten 0:02:22.040 --> 0:02:24.440 years from now, probably the corporate tax rate could be higher, 0:02:24.480 --> 0:02:26.520 and I think that was his concern and part of 0:02:26.520 --> 0:02:28.560 the reason they were taking down those those big gains 0:02:28.560 --> 0:02:29.560 in those big positions. 0:02:30.440 --> 0:02:34.040 The Conglomberate also cut its Amazon steak by seventy five percent. 0:02:34.240 --> 0:02:39.079 They so Amazon. They initially got into Amazon him in 0:02:39.080 --> 0:02:41.519 twenty nineteen. That was one of his investment deputies, I 0:02:41.520 --> 0:02:45.320 think brought it to him. Then again also like tech, 0:02:45.400 --> 0:02:50.520 but a retailer. Right that position we calculated was up 0:02:50.560 --> 0:02:52.400 about one hundred and thirty to one hundred and forty 0:02:52.400 --> 0:02:56.200 percent over the time. They hold it nice but kind 0:02:56.200 --> 0:02:58.440 of in line with the S and P five hundred, 0:02:58.600 --> 0:03:02.360 So it didn't really outperform. So I think it was 0:03:02.480 --> 0:03:03.680 kind of taking some money off the table. 0:03:03.680 --> 0:03:04.000 I sold. 0:03:04.080 --> 0:03:06.880 I believe like one point seven billion worth of that 0:03:06.960 --> 0:03:10.160 stock cut, cutting most of the position, so that one 0:03:10.160 --> 0:03:13.000 I think was probably a company specific didn't really outperform. They 0:03:13.040 --> 0:03:16.600 bought four billion of Alphabet last quarter, so you know, 0:03:16.800 --> 0:03:19.800 the kind of tech aversion you know may be changing 0:03:19.840 --> 0:03:20.320 over time. 0:03:20.639 --> 0:03:22.079 What did he increase takes in? 0:03:22.880 --> 0:03:27.680 So two big ones, Chevron and Chubb. So Chevron is 0:03:27.680 --> 0:03:32.160 they their fifth biggest holding. I think they interestingly, I 0:03:32.160 --> 0:03:36.320 don't know if they were kind of betting on US 0:03:36.400 --> 0:03:39.360 intervention in Venezuela, which happened kind of after the quarter, 0:03:39.440 --> 0:03:41.320 so you can't say that like murderer got taken out 0:03:41.320 --> 0:03:42.760 and this stuff happened, and they did it and reaction 0:03:42.840 --> 0:03:45.200 they did it before. But maybe they were reading the 0:03:45.240 --> 0:03:49.080 tea leaves there. I don't know. It's a big holding 0:03:49.120 --> 0:03:52.040 for them. I think the the kind of geopolitical energy 0:03:52.920 --> 0:03:56.320 play makes total sense. The other one is Chubb, which 0:03:56.800 --> 0:03:58.560 you know, I don't want to get too excited thinking 0:03:58.600 --> 0:04:03.800 about insurance mega deal here, but they are now the 0:04:03.840 --> 0:04:07.240 second well they've been the second largest holder of Chub stock. 0:04:07.320 --> 0:04:08.880 Chub makes total sense. 0:04:09.000 --> 0:04:11.720 It is, in our view, BI a cream of the 0:04:11.720 --> 0:04:17.279 crop insurance company, Global reach, still growing nicely, great management. 0:04:17.440 --> 0:04:19.400 It's a company that Berkshire would want to own. 0:04:19.760 --> 0:04:22.920 Now Berkshire's got their own massive insurance business. 0:04:22.960 --> 0:04:23.239 Yes. 0:04:23.360 --> 0:04:26.800 The interesting thing is you've got two massive insurance businesses. 0:04:26.839 --> 0:04:27.760 They're actually quite. 0:04:27.720 --> 0:04:30.320 Complimentary if one were to want to put them together. 0:04:30.400 --> 0:04:33.800 So the Berkshire business very big personal atto in Geico, 0:04:34.160 --> 0:04:38.440 very big reinsurance, kind of global global reinsurance. Those are 0:04:38.440 --> 0:04:42.600 two businesses that Chubb is not really in. There's some 0:04:42.640 --> 0:04:45.440 overlap in the kind of US specialty businesses that they're 0:04:45.480 --> 0:04:51.080 both in, but it would be phenomenally complementary of those 0:04:51.120 --> 0:04:53.800 two businesses. I think there's probably a lot of hurdles 0:04:53.839 --> 0:04:57.880 to some sort of you know, total deal there Chubb's 0:04:58.200 --> 0:05:01.560 Chubb's market cap is one hundred thirty billion. Berkshire has 0:05:01.600 --> 0:05:03.960 three hundred billion of cash, so they theoretically could buy 0:05:04.240 --> 0:05:06.960 Chubb in cash if they wanted to. But I think 0:05:06.960 --> 0:05:09.880 it's probably some cultural issues and would Shubb really want 0:05:09.880 --> 0:05:12.159 to sell as the other thing? But you know, it 0:05:12.240 --> 0:05:15.440 is something as a stock something Berkshire would want on. 0:05:15.600 --> 0:05:18.560 Is that a strategy that Berkshire actually follows through on 0:05:18.640 --> 0:05:21.400 where it starts off with a steak and then eventually decides, 0:05:21.440 --> 0:05:22.480 you know what, we're just going to buy. 0:05:22.360 --> 0:05:22.760 The whole thing. 0:05:22.920 --> 0:05:24.200 Scarlett, Yeah, they do do that. 0:05:24.320 --> 0:05:26.520 So I think with Burlington Northern, which is a little 0:05:26.520 --> 0:05:28.480 bit before time when they bought it. They did things 0:05:28.520 --> 0:05:31.120 like that where they acquire the public steak and then 0:05:31.120 --> 0:05:33.080 they build it over time. That's why there was a 0:05:33.080 --> 0:05:35.960 lot of speculation about occidental. Buffett then came out and 0:05:35.960 --> 0:05:37.960 threw cold water on it, saying that, but it seemed 0:05:38.000 --> 0:05:40.520 like it was going along with their playbook of huge 0:05:40.560 --> 0:05:41.799 acquisitions that they made before. 0:05:41.839 --> 0:05:43.960 So now that warns out, can we have a serious 0:05:44.000 --> 0:05:45.200 discussion about a dividend? 0:05:46.040 --> 0:05:49.000 We can? I think, you know, we'll get you on 0:05:49.000 --> 0:05:50.640 the phone, grig Able. Let's see what he says. 0:05:51.800 --> 0:05:54.520 You know, I think our take has been in the 0:05:54.680 --> 0:06:00.880 early years. Able will probably adhere to the ethel of Berkshire. 0:06:00.920 --> 0:06:02.320 And I don't think he's going to come in and 0:06:02.360 --> 0:06:05.640 start breaking down walls. I don't think anyone would like 0:06:05.680 --> 0:06:08.840 to see that, especially Buffet's still there. I mean, they 0:06:08.880 --> 0:06:12.760 have tremendous excess capital. Buffett is praised Able as being 0:06:13.040 --> 0:06:16.920 a great capital allocator, great capital manager, and they've also 0:06:16.920 --> 0:06:19.480 said we literally can't there's so much money, we can't 0:06:19.480 --> 0:06:23.039 put it to work in a reasonable way. So it 0:06:23.080 --> 0:06:26.320 would make sense to see something happen there. And I think, look, 0:06:26.520 --> 0:06:28.320 the other thesis is they're not going to be as 0:06:28.360 --> 0:06:31.520 good as anything anymore. Right, there's no better investor than Buffett. 0:06:31.600 --> 0:06:31.960 Give a g. 0:06:32.160 --> 0:06:34.680 Jayne, who is the head of the insurance operations. He's 0:06:34.720 --> 0:06:36.640 been selling a lot of stock. Perhaps he's getting close 0:06:36.640 --> 0:06:38.360 to retirement, so not going to be good at any 0:06:38.400 --> 0:06:40.560 of these things anymore. Some sort of capital which are 0:06:40.560 --> 0:06:41.480 gonna be a big catalyst. 0:06:42.279 --> 0:06:45.440 Stay with us. More from Bloomberg Intelligence coming up after this. 0:06:49.279 --> 0:06:52.960 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:06:53.080 --> 0:06:56.159 weekdays at ten am Eastern on Apple, Cocklay and Android 0:06:56.160 --> 0:06:59.440 Auto with the Bloomberg Business App. Listen on demand wherever 0:06:59.480 --> 0:07:02.800 you get your or watch us live on YouTube. 0:07:03.400 --> 0:07:05.960 Apple's correlation to the Nasdaq one hundred in next has 0:07:06.000 --> 0:07:09.880 tumbled to zero point two to one, it's lowest since 0:07:09.920 --> 0:07:12.320 two thousand and six, as the company's decision to mostly 0:07:12.400 --> 0:07:15.600 sit out the AI arms race has turned it into 0:07:15.640 --> 0:07:19.560 an outlier. Ryan of Lastelka, he's an equities reporter for 0:07:19.600 --> 0:07:22.600 Bloomberg NewCity Space out there in Chicago. Ryan, is this 0:07:22.640 --> 0:07:26.360 a good thing for Apple? A bad thing? Because historically 0:07:26.360 --> 0:07:28.640 it's been like, Hey, Apple, when are you guys going 0:07:28.720 --> 0:07:31.520 to get on this AI bandwagon? And then maybe now 0:07:31.560 --> 0:07:33.560 it's kind of working out to their benefit that they're 0:07:33.600 --> 0:07:34.320 not so much on that. 0:07:35.480 --> 0:07:38.200 Yeah, So in this market, obviously, there has been a 0:07:38.320 --> 0:07:41.480 lot of AI related volatility. There's been a lot of 0:07:41.520 --> 0:07:44.360 concern about the amount of money that big tech companies 0:07:44.400 --> 0:07:47.360 are spending on AI, but Apple isn't really spending on 0:07:47.440 --> 0:07:49.600 AI in that way. There's been a lot of concern 0:07:49.640 --> 0:07:53.800 about AI disrupting software companies. Apple isn't really software. There's 0:07:53.840 --> 0:07:56.680 a lot of concerns about AI disrupting all parts of 0:07:56.760 --> 0:08:00.800 the market, whether it's financial services, legal services, data, all 0:08:00.800 --> 0:08:03.520 these kinds of things, none of which really involve Apple. 0:08:03.600 --> 0:08:06.360 But at the same time, Apple is probably going to 0:08:06.400 --> 0:08:10.160 be the major way that people access AI services on 0:08:10.200 --> 0:08:12.400 their phones, on their computers, on their tablets, so on, 0:08:12.440 --> 0:08:14.760 and so forth, which means it has a certain amount 0:08:14.800 --> 0:08:18.640 of upside potential related to the technology without having to 0:08:18.680 --> 0:08:23.160 spend on it the way companies like Microsoft or Alphabet 0:08:23.240 --> 0:08:26.000 or Meta are. So it's kind of perfectly positioned in 0:08:26.080 --> 0:08:29.760 this current environment when there's concern about both AI spending 0:08:29.920 --> 0:08:31.240 but also AI disruption. 0:08:31.720 --> 0:08:33.880 So it kind of worked out that Apple hasn't made 0:08:33.960 --> 0:08:37.600 very much progress on AI, but on overall, the fact 0:08:37.640 --> 0:08:39.520 that it didn't do a lot on AI was kind 0:08:39.520 --> 0:08:42.360 of falling behind. In fact, losing talent was something that 0:08:42.480 --> 0:08:44.840 was a drag on the stock, say a year ago. 0:08:45.400 --> 0:08:47.760 Yeah, people were concerned about this. But a few weeks 0:08:47.760 --> 0:08:50.840 ago it announced a multi year partnership with Alphabet, where 0:08:50.880 --> 0:08:54.120 Google is going to be providing the technology behind Apple's AI, 0:08:54.320 --> 0:08:56.840 including Siri. That was seen as a way for the 0:08:56.880 --> 0:08:59.040 people to feel really relieved that they are going to 0:08:59.080 --> 0:09:01.560 be involved with a I have some kind of offering 0:09:01.600 --> 0:09:06.080 from a highly respected, you know, AI lab model provider 0:09:06.200 --> 0:09:09.800 in Alphabet without having to you know, pay for it 0:09:09.920 --> 0:09:12.480 or have developed their own in house stuff, which is 0:09:12.480 --> 0:09:16.520 obviously an area of huge competition, heavy expenses. I think 0:09:17.160 --> 0:09:19.400 the four major spenders this year are spending six hundred 0:09:19.400 --> 0:09:21.240 and fifty billions, so they are stepping out of that 0:09:21.280 --> 0:09:22.480 and they don't have to worry about that. 0:09:23.280 --> 0:09:26.439 Stay with us. More from Bloomberg Intelligence coming up after this. 0:09:30.320 --> 0:09:34.040 You're listening to the Bloomberg Intelligence podcast. Catch us live 0:09:34.120 --> 0:09:37.160 weekdays at ten am Eastern on Apple, Cocklay and Android 0:09:37.200 --> 0:09:40.520 Auto with the Bloomberg Business App. Listen on demand wherever 0:09:40.559 --> 0:09:43.680 you get your podcasts, or watch us live on YouTube. 0:09:44.280 --> 0:09:46.600 What the big gainers today and it happened even before 0:09:46.600 --> 0:09:50.080 the market open. Paul is MSG s MSG Sports. It 0:09:50.120 --> 0:09:52.240 is the owner of the Knicks and the Rangers, not 0:09:52.360 --> 0:09:54.880 the owner of MSG Networks because that's another business. Yes, 0:09:55.120 --> 0:09:57.560 so there's a whole bunch of businesses within MSG. I 0:09:57.559 --> 0:09:59.240 mean it's difficult to follow. 0:09:59.600 --> 0:10:02.960 Yeah, and after they sold their cable business years ago, 0:10:03.600 --> 0:10:05.080 so now they just focus on their entertainment. 0:10:05.120 --> 0:10:07.440 And then there's Sphere Entertainment, which is the big spere 0:10:07.440 --> 0:10:10.280 in Las Vegas. Awesome, So all of James Dolan's media 0:10:10.360 --> 0:10:14.760 properties and assets in this suite of publicly traded companies. 0:10:14.840 --> 0:10:16.079 Let's bring in Randall Williams. 0:10:16.200 --> 0:10:18.600 He is our business of sports reporter here at Bloomberg 0:10:18.679 --> 0:10:21.600 and Randall, you have been following this story about this 0:10:21.720 --> 0:10:23.720 potential split of the New York Knicks and the New 0:10:23.800 --> 0:10:27.080 York Rangers within MSG Sports. This is something that a 0:10:27.080 --> 0:10:29.440 lot of people have been calling for for a long time. 0:10:29.960 --> 0:10:30.160 Yeah. 0:10:30.200 --> 0:10:33.040 You look at the enterprise value of the Knicks and 0:10:33.120 --> 0:10:35.200 Rangers and what they're traded at its seven billion dollars. 0:10:35.240 --> 0:10:36.880 But you look at what the Lakers sold for a 0:10:36.920 --> 0:10:39.760 loan ten billion dollars, and I think the Knicks obviously 0:10:39.760 --> 0:10:41.760 are in a larger market than New York. The Lakers 0:10:41.800 --> 0:10:44.280 have won more titles, but New York is New York, 0:10:44.320 --> 0:10:46.640 and so both the Knicks and the Rangers I think 0:10:46.640 --> 0:10:50.720 would carry a tremendous value, maybe twelve billion dollars combined, 0:10:50.720 --> 0:10:52.280 and that's on the low end. 0:10:52.480 --> 0:10:57.199 So is this maybe a first step for selling one 0:10:57.200 --> 0:10:59.600 of the teams? Selling a piece of one of them? 0:10:59.640 --> 0:11:03.040 Get to speculatative territory with James Dolan, that's always a 0:11:03.080 --> 0:11:06.120 fun place. Look, I mean Silver Lake owns a piece 0:11:06.240 --> 0:11:10.040 of MSG Sports, so that's five percent. It's a ten 0:11:10.120 --> 0:11:12.800 percent stake, but probably five percent each. And when you 0:11:12.800 --> 0:11:15.880 think about someone wanting to buy into that, you would 0:11:15.920 --> 0:11:20.000 want to know how much each individually is worth. If not, 0:11:20.280 --> 0:11:22.240 you're buying into something and it's like you could be 0:11:22.280 --> 0:11:26.240 buying in at a supreme price or maybe something that's 0:11:26.280 --> 0:11:28.440 a little bit lower. And I think buyers who are 0:11:28.559 --> 0:11:31.600 interested in there have been several over the years, want 0:11:32.120 --> 0:11:35.000 want a more precise price, and so do the shareholders 0:11:35.000 --> 0:11:35.880 of MSG Sports. 0:11:37.720 --> 0:11:40.840 So what's held up the company from being split up 0:11:40.920 --> 0:11:42.840 up until now because there's been a lot of calls 0:11:42.840 --> 0:11:46.480 for the enterprise value trading at a discount to the 0:11:46.520 --> 0:11:49.160 actual value of each franchise has been there for a while. 0:11:49.240 --> 0:11:53.960 I know the answer for voting stock is from the 0:11:54.000 --> 0:11:54.760 Dolan control. 0:11:54.840 --> 0:11:59.000 Yeah, I think that James Dolan has long been the 0:11:59.040 --> 0:12:02.120 controlling person for all of these companies. He decides where 0:12:02.160 --> 0:12:04.840 for worse, yes, exactly, he decides, you know what he 0:12:04.920 --> 0:12:06.679 wants to do. And there is a board of directors 0:12:06.679 --> 0:12:08.600 that voted on this. But this would have never been 0:12:08.720 --> 0:12:11.400 up been up for a vote had James Dolan and said, 0:12:11.400 --> 0:12:13.839 you know what, maybe we should consider this, and then 0:12:13.880 --> 0:12:15.400 from there on, you know, things happen. 0:12:15.280 --> 0:12:17.720 And then they vote on this. Madison Square Garden, James Stone, 0:12:17.760 --> 0:12:20.640 did they own the garden itself? The building? I believe so, yeah, 0:12:20.640 --> 0:12:22.480 because that's always a big that's always a big part 0:12:22.520 --> 0:12:24.520 of it too. Do you own the arena they plan or. 0:12:24.840 --> 0:12:28.560 Yes, a different publicly traded company. Exactly, the exactly. 0:12:28.600 --> 0:12:31.360 And I had a Bloomberg terminal reader and the original 0:12:31.360 --> 0:12:33.800 copy that I wrote this morning. I said Madison Square 0:12:33.840 --> 0:12:37.360 Garden was one of the most famous in the world, 0:12:37.600 --> 0:12:40.040 and someone quickly, someone quickly replied and said, no, it 0:12:40.320 --> 0:12:43.240 is the most famous arena in the world. So Madison 0:12:43.280 --> 0:12:46.080 Square Garden is a huge you know, attraction. When you 0:12:46.120 --> 0:12:48.280 think about arenas in New York. There's the Barclay Center, 0:12:48.280 --> 0:12:50.720 of course, which is newer, but the legacy of New 0:12:50.800 --> 0:12:53.560 York is often rooted in MSG and the events that 0:12:53.600 --> 0:12:55.360 it's held over many many years. 0:12:55.720 --> 0:12:57.679 Yeah, I mean, first of all, and they also put 0:12:57.760 --> 0:12:59.959 in I think close to a billion dollars in renov 0:13:00.320 --> 0:13:03.160 several years ago, so they've really upgraded the garden. What's 0:13:03.280 --> 0:13:04.800 one of the many great things about going to the 0:13:04.800 --> 0:13:08.160 garden is they have the photos on the wall, the concourses, 0:13:08.400 --> 0:13:13.440 all the great events, whether it's a concert, a game, whatever, 0:13:13.679 --> 0:13:15.240 and there's thousands of them. 0:13:15.240 --> 0:13:17.800 There's no there's no venue that has a greater history, 0:13:17.840 --> 0:13:20.080 I would argue than Madison Square Garden that is still 0:13:20.120 --> 0:13:23.560 you know, open and operational. And that's that's part of this. 0:13:23.600 --> 0:13:25.439 I mean, you think about the Knicks playoff end last year. 0:13:25.480 --> 0:13:27.719 You think about the Rangers and what they've done not 0:13:27.920 --> 0:13:31.120 the past coming the past two seasons, but in the 0:13:31.160 --> 0:13:34.199 seasons before that, all of these things. When they eventually win, 0:13:34.400 --> 0:13:37.160 you know, God willing, it isn't MSG. It isn't one 0:13:37.160 --> 0:13:38.719 of the deals where you know they're in away game 0:13:38.720 --> 0:13:40.280 and then they have to come back. If it happens 0:13:40.280 --> 0:13:42.480 in MSG that will probably be the biggest moment in 0:13:42.480 --> 0:13:44.560 that arena in the last twenty five years, and so 0:13:44.920 --> 0:13:48.160 whoever wants to buy into that potentially is going to 0:13:48.200 --> 0:13:49.199 want a good value at it. 0:13:49.559 --> 0:13:51.720 There is also a note from light Shed that pointed 0:13:51.720 --> 0:13:53.480 out that there's a new tax law that goes into 0:13:53.520 --> 0:13:56.319 effect for the twenty twenty eight fiscal year that were 0:13:56.360 --> 0:14:01.000 public companies limits deductions on one million dollars two one 0:14:01.000 --> 0:14:02.440 million dollars per covered employees. 0:14:02.440 --> 0:14:04.240 For sports teams, it's easy. 0:14:03.960 --> 0:14:06.240 To find a lot of employees that make at least 0:14:06.280 --> 0:14:09.560 a million dollars a year. So once this goes through 0:14:09.600 --> 0:14:12.360 in twenty twenty eight, that's going to put the company 0:14:12.400 --> 0:14:16.320 in a negative free cash flow situation unless the Knicks, 0:14:16.360 --> 0:14:18.120 for instance, go deep into a playoff run or the 0:14:18.200 --> 0:14:20.680 Rangers go deep into a playoff run. So it also 0:14:20.720 --> 0:14:23.000 allows the company, you know, for tax reasons, to be 0:14:23.040 --> 0:14:23.800 in a better position. 0:14:24.080 --> 0:14:25.240 Absolutely absolutely. 0:14:25.240 --> 0:14:26.960 I mean there's not a lot of publicly traded sports 0:14:27.000 --> 0:14:29.920 companies out there for this reason in particular, and you 0:14:29.920 --> 0:14:31.760 think about all of the big ones. You think about 0:14:31.760 --> 0:14:34.960 the Cranky Sports and Entertainment which houses the Rams, the Nuggets, 0:14:35.000 --> 0:14:38.560 I believe another soccer team and so many more. It's private, 0:14:38.760 --> 0:14:41.360 and that's that's for a reason. But this one is unique, 0:14:41.400 --> 0:14:43.600 and Madison's Square Garden is Madison Square Garden. The Knicks 0:14:43.600 --> 0:14:45.080 to the Knicks and the Rangers of the Rangers. 0:14:45.320 --> 0:14:48.640 Another big trade that a lot of people are thinking 0:14:48.640 --> 0:14:50.760 about in professional sports is in the NFL with the 0:14:50.760 --> 0:14:53.960 Seattle Seahawks. Yes, what's the status to that? Because that 0:14:54.040 --> 0:14:55.880 the NFL teams don't come along very often. 0:14:55.920 --> 0:14:59.000 Sure, so, the NFL's finance committee has been talking about 0:14:59.000 --> 0:15:01.160 this for over a year, and I think things just 0:15:01.240 --> 0:15:04.720 are at a point now where the ownership group in Seattle, 0:15:04.920 --> 0:15:07.480 the trust of Paul Allen, the former co founder of Microsoft, 0:15:07.680 --> 0:15:09.040 is at a point where they're ready to sell. 0:15:09.440 --> 0:15:10.760 Hired some lawyers, right they have. 0:15:10.840 --> 0:15:13.480 That's reported by SBJ. I don't believe the paperwork is 0:15:13.520 --> 0:15:17.400 signed just yet, but I trust beneficher, and you know, 0:15:17.440 --> 0:15:19.240 I think that that will happen later this year, whether 0:15:19.280 --> 0:15:21.880 that's at the NFL league meetings and Phoenix around the 0:15:21.960 --> 0:15:24.480 end of March and April, and then I think NFL 0:15:24.520 --> 0:15:27.200 owners would like to have a new owner by the 0:15:27.200 --> 0:15:28.400 time the new season starts. 0:15:28.680 --> 0:15:30.920 How much of a stake do they own in the Seahawks. 0:15:30.960 --> 0:15:33.920 I mean, is this, you know, like super stake or 0:15:33.960 --> 0:15:34.240 is it. 0:15:34.280 --> 0:15:36.160 Just you know, it's a control stake in the team. 0:15:36.480 --> 0:15:39.280 And that wouldn't have happened in you know, since the 0:15:39.320 --> 0:15:42.000 Commanders are sold for six billion dollars. So whoever buys 0:15:42.200 --> 0:15:44.880 the Seahawks shots? Yeah, exactly. 0:15:45.040 --> 0:15:48.000 And is it any sense whether it's going to be 0:15:47.680 --> 0:15:51.760 a billionaire financing group? 0:15:52.400 --> 0:15:53.760 Look, there's so many The. 0:15:54.360 --> 0:15:58.040 NFL's finance structure sees that a controlling owner has to 0:15:58.080 --> 0:16:00.160 have thirty percent of a team upfront. So it is 0:16:00.160 --> 0:16:02.480 in a situation where you know, you can take on 0:16:02.560 --> 0:16:05.000 some debt, but not a lot and thirty percent. 0:16:05.000 --> 0:16:05.760 I would imagine. 0:16:05.800 --> 0:16:08.160 I said this earlier, I think the Seahawks will trade 0:16:08.160 --> 0:16:11.000 for at minimum eight billion dollars. Thirty percent of that 0:16:11.160 --> 0:16:13.160 is going to be around two and a half in cash. 0:16:13.400 --> 0:16:15.640 There's not a lot of people who are willing to 0:16:15.760 --> 0:16:17.360 just write a two and a half billion dollar check 0:16:17.360 --> 0:16:19.760 in cash and then raise the money around it, because 0:16:19.800 --> 0:16:22.600 it isn't just raising the money, it's communicating to those 0:16:22.640 --> 0:16:24.800 people that you're trying to bring in your ownership group. Today, 0:16:25.040 --> 0:16:27.080 I run this, but you're welcome to come on board 0:16:27.080 --> 0:16:28.640 the ship, so long as you understand that you're not 0:16:28.680 --> 0:16:30.560 the captain. And that's tough for a lot of people. 0:16:30.640 --> 0:16:32.840 Josh Harris did it, but he did it without private equity. 0:16:33.000 --> 0:16:36.000 Private equity is an option now. And so whoever buys this, 0:16:36.400 --> 0:16:39.320 whether it be you know, Jeff Bezos or whoever who 0:16:39.360 --> 0:16:41.920 Jeff Bezos considered buying the commanders, is going to have 0:16:42.000 --> 0:16:43.000 to write they have to check. 0:16:45.120 --> 0:16:47.920 Stay with us. More from Bloomberg Intelligence coming up here 0:16:47.960 --> 0:16:48.160 for this. 0:16:51.240 --> 0:16:54.960 You're listening to the Bloomberg Intelligence podcast. Catch us live 0:16:55.040 --> 0:16:57.720 weekdays at ten am Eastern on Apple cor Play and 0:16:57.720 --> 0:17:01.000 Android Auto with the Bloomberg Business app. Listen on demand 0:17:01.040 --> 0:17:04.600 wherever you get your podcasts, or watch us live on YouTube. 0:17:05.240 --> 0:17:07.520 Let's talk a little technology here. I got the SMP. 0:17:07.680 --> 0:17:09.840 I mean I get the Nasdaq, which is where you 0:17:09.880 --> 0:17:11.600 find a lot of the tech names. It's up one 0:17:11.600 --> 0:17:14.440 point four percent today, so that's a nice move. And 0:17:14.480 --> 0:17:16.840 there's always news in the text sector, which is why 0:17:16.880 --> 0:17:19.280 we have to chat with men deep Singing and on 0:17:19.400 --> 0:17:22.119 around run and all the folks at Bloomberg Intelligence to 0:17:22.200 --> 0:17:25.879 cover the tech space. So often. Meta platforms agreed to 0:17:25.920 --> 0:17:31.440 deploy millions of Nvidia processes over the next few years. Mandy, 0:17:31.600 --> 0:17:34.720 what does this mean? Is it new? What's going on here? 0:17:35.200 --> 0:17:38.719 Well, I mean it's not really new because Meta is 0:17:39.040 --> 0:17:43.120 among the top two customers for Invidia chips. So it's 0:17:43.280 --> 0:17:45.880 more to do with the fact that not only are 0:17:45.920 --> 0:17:50.280 they using the GPUs from Nvidia, they're also using the 0:17:50.440 --> 0:17:54.679 CPUs now and Intel and MD used to own that 0:17:54.880 --> 0:17:59.159 market off server CPUs, and what Nvidia is saying is 0:18:00.119 --> 0:18:03.439 give you a better throughput, a better performance if you 0:18:03.600 --> 0:18:09.919 end up using our GPU cluster complement CPUs. And I 0:18:09.920 --> 0:18:13.720 think overall, I mean that's Meta's way of making sure 0:18:13.800 --> 0:18:16.760 they get the supply from Nvidia, because we heard that 0:18:16.880 --> 0:18:20.200 at least ten times from Jensen this year. The demand 0:18:20.280 --> 0:18:24.040 is really strong, and you know, they get to decide 0:18:24.240 --> 0:18:27.080 who they allocate their chips to. So this is one 0:18:27.119 --> 0:18:29.360 way that Meta is making sure they have the upline. 0:18:29.680 --> 0:18:31.119 Yeah, all makes a lot of sense. 0:18:31.800 --> 0:18:35.639 So again the hyperscalers spending more and you know, striking 0:18:35.680 --> 0:18:38.320 up new deals. Let's talk a little bit about uber 0:18:38.560 --> 0:18:40.720 It's planning to spend more than one hundred million to 0:18:41.480 --> 0:18:45.240 really supercharges robotaxi charging stations. How do you think about 0:18:45.280 --> 0:18:47.879 whether This changes the profile of what Uber is as 0:18:47.920 --> 0:18:48.359 a company. 0:18:49.160 --> 0:18:52.920 I think for Uber, given the scale of their rides, 0:18:52.960 --> 0:18:56.040 you know, they do over thirteen billion rides a year. 0:18:56.480 --> 0:18:59.560 Compare that to a Weveimo that just did twenty million 0:18:59.640 --> 0:19:00.400 rides year. 0:19:00.720 --> 0:19:03.600