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Speaker 1: This is Wall Street Week. I'm David Weston bringing you

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Speaker 1: stories of capitalism coming to an Internet near you. Artificial intelligence,

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Speaker 1: Will those helpful chatbots kill the search and advertising paying

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Speaker 1: for all that content that you enjoy.

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Speaker 2: And looked up of Falcony?

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Speaker 1: Plus the race to make money in space. Companies are

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Speaker 1: competing to launch one hundred thousand satellites in the next

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Speaker 1: five years, as China builds out its own space infrastructure

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Speaker 1: in Latin America and investing in Bolivia. A new regime

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Speaker 1: aims to be friendly to private enterprise. But when is

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Speaker 1: the right time for investors to dip their toe in

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Speaker 1: the water. But we begin with the continuing conflict in Iran.

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Speaker 1: Harvard professor and former I'M chief economist Ken Rogoff chronicled

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Speaker 1: the US dollars rise in the beginning of its decline

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Speaker 1: as a global currency in his latest book, Our Dollar,

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Speaker 1: Your Problem. It turns out that it's not just oil

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Speaker 1: and aluminium at risk in the Iran war. It also

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Speaker 1: may be the status of the dollar. Ken. In your book,

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Speaker 1: Our Dollar, Your Problem, you talk about the position of

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Speaker 1: the US dollar as declining, gradually retire in relation to

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Speaker 1: other currencies. We now have a conflict in Iran. Is

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Speaker 1: that affecting that decline?

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Speaker 3: I don't think there's any question that it will affect

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Speaker 3: the decline. It could go either way. It depends on

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Speaker 3: how it comes out. If the US comes out incredibly triumphant,

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Speaker 3: there's peace in the Middle East, everyone you know, looks

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Speaker 3: to the United States to maintain peace. That's one outcome.

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Speaker 3: Another outcome where's where it's viewed as a strategic defeat

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Speaker 3: and China gains. But you know, it's it's a step.

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Speaker 3: I don't think either way. It's changing a dynamic that

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Speaker 3: was going to happen anyways. There are things on the

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Speaker 3: outside that it influences. So it's definitely going to help

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Speaker 3: China accelerate getting other countries to use its currency, particularly

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Speaker 3: for Chinese imports for example, if China buys oil or

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Speaker 3: China buys anything, it's going to help in that dimension.

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Speaker 3: But it's also affecting global debt because everybody sees a

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Speaker 3: lot of need for military expending. The US is the

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Speaker 3: biggest debtor in the world. We lose the most when

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Speaker 3: global interest rates go up. So there are pressures from

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Speaker 3: the outside coming from everybody's trying to look for other

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Speaker 3: options and pressures from the inside that we're running this

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Speaker 3: big debt that is manageable if we wanted to, but

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Speaker 3: there's not a lot of will to want to.

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Speaker 1: It is the strength of a currency reflective of the

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Speaker 1: strength and doing military strength of the country. In your book,

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Speaker 1: you correctly to the Armada actually with Queen Elizabeth first

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Speaker 1: in the Spanish as is this potentially a barometer of

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Speaker 1: how the world is perceiving the relative military strength the

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Speaker 1: United States.

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Speaker 3: The military strengths a piece of being the dominant currency,

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Speaker 3: and here just to be clear, we're talking about the

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Speaker 3: dollars market share, which reached an incredible peak about ten

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Speaker 3: years ago. But also military strength gives you the ability

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Speaker 3: to affect negotiations. They can be over very unrelated things.

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Speaker 3: They can have to do with how the IMF works,

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Speaker 3: They can have to do with how global banking regulation works.

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Speaker 3: So having the military power at the end of the

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Speaker 3: day so as well you know, of course, of course

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Speaker 3: it matters for a lot of things. And if you're

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Speaker 3: looked at as weaker, it hurts you.

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Speaker 1: And part of the protection historically, going back to like

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Speaker 1: nineteen seventy four, was of the Gulf States, countries like

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Speaker 1: Saudi Arabia because of US military production. Now, as you say,

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Speaker 1: it depends on how this all plays out. But if

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Speaker 1: in fact the United States does not have a triumph

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Speaker 1: of some sort over Iran, does it really undermine the

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Speaker 1: confidence of the Golf States using the US dollar.

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Speaker 3: Well, the Golf States are really important anchor at the

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Speaker 3: US dollar. And you know, it's interesting you picked the

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Speaker 3: nineteen seventies because it really fell in the nineteen seventies.

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Speaker 3: Europe left the dollar, that's worth remembering. And the Golf

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Speaker 3: States when they sort of did their recycling of their

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Speaker 3: petro dollars through the United States and priced oil and dollars,

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Speaker 3: I think it was sort of helpful, although nevertheless, you

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Speaker 3: know that period was down. I don't want to overstate

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Speaker 3: the petro dollar. I want to be a little careful

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Speaker 3: about that because oil is a very flexible price. We're

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Speaker 3: all staring at Brent crude and it's still here. It

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Speaker 3: goes here, it can move very fast. So it's a

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Speaker 3: little bit like my paying visa master card. It matters

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Speaker 3: a lot more where the goods manufactured goods are priced

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Speaker 3: in dollars, but it's important. I mean, it fills a

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Speaker 3: lot of roles. The Gulf states use dollars. Saudi is

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Speaker 3: still pegged to the dollar. I don't know how long

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Speaker 3: that's going to last, but they still are. And because

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Speaker 3: so many of them are pegged to the dollar, rotate

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Speaker 3: around the dollar, they hold more dollars. They've been very

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Speaker 3: important to our business model. Not as important as China,

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Speaker 3: but they've been important. And it's unclear raw this is

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Speaker 3: playing out. I mean, I think a lot of the

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Speaker 3: Golf States are looking at us and saying, wait, I

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Speaker 3: thought you built those bases to protect us. I didn't

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Speaker 3: know you built those, you know, various military complexes in

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Speaker 3: our countries, so we could be target practice. And are

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Speaker 3: you on our side? Are you on their side?

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Speaker 1: Like?

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Speaker 3: What's going on? That's been a delicate dance. I think

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Speaker 3: we know how it comes out yet. So you know,

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Speaker 3: China's kind of playing it cool. A lot of people

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Speaker 3: say they may benefit, they might, but I just think

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Speaker 3: we have to see what the endgame of this is.

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Speaker 1: The Chinese might benefit, will the UN benefit Because we

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Speaker 1: see Aron saying we'll let oil through the street home

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Speaker 1: moves if you sell it in U one, for example,

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Speaker 1: and China certainly wants more transactions denominated.

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Speaker 3: They're doing quite a bit in crypto too. Also, by

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Speaker 3: the way, Yeah, I mean they get paid in dollars.

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Speaker 3: We can sanction them immediately. They're putting it hostage. Why

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Speaker 3: the heck should they do that. That's certainly significant. But

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Speaker 3: the big thing of the Iran war in the future

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Speaker 3: of the dollar is it's raised global interest rates. They

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Speaker 3: were going up and up and up. So if I

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Speaker 3: look at the dynamic of how I see things unfolding,

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Speaker 3: it's that there's this pressures from the outside that are

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Speaker 3: very slow moving, but they're happening to have a more

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Speaker 3: multipolar system and their problems on the inside, where we're

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Speaker 3: the richest country ever, ever, ever, but we still have

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Speaker 3: trouble paying our bills and running these crazy large debts.

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Speaker 3: There's no political consensus and either party. The Republicans don't

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Speaker 3: want to tax anyone. The Democrats think one percent of

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Speaker 3: people can pay, which doesn't add up, and so we

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Speaker 3: are racing towards having a fiscal problem, and then central

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Speaker 3: bank independence becomes a problem because when you have a

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Speaker 3: fiscal problem, you're kind of looking for the central bank

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Speaker 3: to bail you out. And if all that's happening, that's

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Speaker 3: sort of what happened in the seventies in a way

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Speaker 3: it undermines the dollar.

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Speaker 1: So what are the metrics that people should use in

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Speaker 1: figuring out where we are in the relative problemce of

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Speaker 1: the dollars?

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Speaker 3: What do you look at?

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Speaker 1: I mean, for example, were you surprised that the dollar

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Speaker 1: was not more of a safe harbor when they were

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Speaker 1: on conflict broke out?

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Speaker 3: So people in finance who are doing all these papers

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Speaker 3: showing that the premium we used to extract on longer

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Speaker 3: term debt is gone. So on short term debt, there's

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Speaker 3: still a premium to dollars. It's still the safest asset

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Speaker 3: long term debt, it's not there anymore. I mean, it's

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Speaker 3: safer than let's say, you know, some African or South

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Speaker 3: American countries debt, but if you compare it to many

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Speaker 3: European countries, Japan, it doesn't rank that way they used to.

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Speaker 3: And so there are ways in which what we're getting

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Speaker 3: out of the deal is going down. Now we can

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Speaker 3: crowd everything into short term borrowing. And Secretary bess And said,

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Speaker 3: I think interest rates are going to go down. I'm

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Speaker 3: going to borrow more short term. Okay, but that's very risky.

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Speaker 3: In fact, I think he was saying not to do

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Speaker 3: that ten years ago, and so we're losing. You see

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Speaker 3: that in many measures. On the other hand, you know,

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Speaker 3: these things are very slow moving. If you do fearign

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Speaker 3: exchange trading as overwhelmingly goes through dollars. If you do

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Speaker 3: a currency of denomination of debt, it's overwhelmingly dollars. Of course,

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Speaker 3: part of that's because more than fifty percent of the

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Speaker 3: debt of the advanced countries is ours. More than that

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Speaker 3: in global bonds it might even be sixty or seventy

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Speaker 3: percent is ours. So there's a lot of liquidity in it.

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Speaker 3: I still remember twenty years ago a prominent European economist

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Speaker 3: getting up at a meeting and saying, today is a

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Speaker 3: big day. There's more euro debt than dollar debt, which

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Speaker 3: was true that day. Well how did that work out?

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Speaker 3: You know? I mean it's I think this is a

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Speaker 3: slow moving thing. We're seeing it in the interest right spreads,

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Speaker 3: We're seeing it in reserves. So what countries are choosing

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Speaker 3: to do. We're seeing it in actions that the Europeans

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Speaker 3: and the Chinese are taking to develop independent systems. But

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Speaker 3: this isn't something the private sector is just going to do.

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Speaker 3: It's mostly the Chinese. The Europeans are leading the way.

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Speaker 3: We are digging our grave, so to speak, and it's

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Speaker 3: all the actions of the governments. It's not something that's

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Speaker 3: happening overnight.

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Speaker 1: Coming up. The content business made a long and difficult

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Speaker 1: transition from print to the Internet. But what happens if

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Speaker 1: scrolling online is now replaced by ai? We bringing the

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Speaker 1: story of another revolution in how we get our information

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Speaker 1: and entertainment. This is a story about big changes on

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Speaker 1: tiny screens. Since its inception, the Internet has become where

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Speaker 1: we turn for content. Content we mostly access through search,

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Speaker 1: and that's mostly free, but of course it's not really free.

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Speaker 1: When we searched on platforms like Google, we were directed

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Speaker 1: to web pages created by publishers who got paid for

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Speaker 1: all those ads we spent time looking at. Now all

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Speaker 1: that is changing, and as AI becomes the new gateway

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Speaker 1: to the Web, it's transforming the economics of the Internet.

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Speaker 4: We believe the high water mark for Internet traffic that

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Speaker 4: was sent out from social media and search and AI tools,

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Speaker 4: which are quite nascent at the time, was twenty twenty two. Essentially,

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Speaker 4: over the last four years, those numbers have been dropping.

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Speaker 1: Rand Fishkin is an author and entrepreneur who specializes in

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Speaker 1: online search, the main way that most of us interact

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Speaker 1: with the web.

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Speaker 4: I do a lot of research with clickstream data, which

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Speaker 4: essentially looks at devices and what they visit and don't visit.

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Speaker 4: Whereas in twenty eleven, Google was stending north of seventy

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Speaker 4: percent of all searches to a third party website, right

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Speaker 4: a website not owner controlled by Google, and today that

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Speaker 4: number is in the mid forties and falling. That clearly

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Speaker 4: indicates this zero click trend.

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Speaker 1: Zero click it's a term for an online search result

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Speaker 1: that doesn't lead to any other web pages. That can

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Speaker 1: be good news for users if their question has been

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Speaker 1: answered quickly and correctly, no need to spend time scrolling

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Speaker 1: through all that text and pages of ads. But if

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Speaker 1: you are a publisher counting on that click to bring

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Speaker 1: traffic to your website and to sell those ads, it's

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Speaker 1: very bad news, which means the creators of all that

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Speaker 1: web content have to rethink the game.

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Speaker 4: Long before AI, Google started disintermediating content providers by answering

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Speaker 4: questions right in the search results you search for the

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Speaker 4: mets score scores right at the top. An AI just

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Speaker 4: enhance their ability to do this.

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Speaker 1: For an idea of just how big this change is

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Speaker 1: for Google itself, here's the company's head of search talking

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Speaker 1: about incorporating AI just last month.

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Speaker 5: Now we're entering the next chapter of Google Search. We're incredible.

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Speaker 5: AI features aren't just in search. Google Search is AI

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Speaker 5: search through and through now. This is the biggest upgrade

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Speaker 5: to our iconic search box since its debut over twenty

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Speaker 5: five years ago.

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Speaker 6: The problem is that most people don't click on the

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Speaker 6: links Google.

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Speaker 1: Caitlin Petrie is author of All the News That's Fit

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Speaker 1: to Click and a professor at Rutgers who studies the

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Speaker 1: way algorithms shape online media.

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Speaker 6: News sites that were counting on referrals from Google for

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Speaker 6: their traffic, for their ad revenue to draw maybe subscribers

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Speaker 6: who might come to the site, get interested and then subscribe,

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Speaker 6: are now seeing, in some cases very dramatic decreases in

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Speaker 6: the traffic that they're getting from Google.

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Speaker 1: The move from print to the Internet, many people think,

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Speaker 1: actually eliminated some news sources. A lot of local newspapers,

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Speaker 1: for example, were eliminated partly because of the business model challenge,

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Speaker 1: the revenue challenge. Do we face a risk of that

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Speaker 1: with AI? That we will eliminate even further sources.

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Speaker 6: I think we do. I think it's a major concern.

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Speaker 1: It was really revealing. Perhaps nobody in the world has

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Speaker 1: a better view of these changes and what they mean

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Speaker 1: for online content creators than Neil Vogel.

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Speaker 7: What happened was our audience, right, and where we reach

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Speaker 7: half of America each month. Our audience on the Internet

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Speaker 7: was seventy five percent from Google Search twenty twenty two,

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Speaker 7: maybe a little bit more maletle less Footballpark that that

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Speaker 7: is now twenty five percent of our audience.

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Speaker 1: Vogel is CEO of People, Inc. The largest online and

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Speaker 1: print publisher in America. It reaches one hundred and seventy

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Speaker 1: five million people each month with dozens of publications whose

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Speaker 1: names you know well better Homes.

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Speaker 7: And Gardens, People Entertainment, Weekly, Travel and Leisure, Food and Wine.

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Speaker 7: And we put all these brands together because we believed

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Speaker 7: we understood how to run these classic heritage brands on

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Speaker 7: the Internet, and we've been proven right.

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Speaker 1: Although Vogel has had a front row seat to the

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Speaker 1: collapse in search traffic that AI has ushered in, he

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Speaker 1: also told us something surprising. His business is booming.

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Speaker 7: We're very profitable, and we're defying the narrative around publishing

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Speaker 7: that as publishers can't succeed in this world, and we're succeeding.

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Speaker 7: We feel really good and really optimistic about the future

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Speaker 7: of media.

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Speaker 1: Back in the day before there even wasn't internet, believe

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Speaker 1: or not, there was a time if you look at

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Speaker 1: a publisher, newspaper, magazine, their revenue came from two sources,

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Speaker 1: subscription and advertising. What's your revenue model?

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Speaker 7: If you look at the Internet, that is where we thrive.

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Speaker 7: That is our bread and butter. Ninety percent of our

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Speaker 7: profitability comes from our Internet and our online presence. That

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Speaker 7: is very much advertising, but it's also lots of other things.

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Speaker 1: Those other things include deals and branded products. But Vogel

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Speaker 1: says they've also got a new revenue stream.

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Speaker 7: We licensed content to lms and AI engines. We sat

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Speaker 7: with Sam Altman at OpenAI right before they could launch

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Speaker 7: the first commercial LM. This is the fall of twenty

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Speaker 7: twenty two, and we saw this LLM and we saw

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Speaker 7: what it could do and we were like, oh, like,

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Speaker 7: the world is going to be different from here, and

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Speaker 7: there's moments in your life we know the world's going

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Speaker 7: to be different, like you have your first kid, or

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Speaker 7: the Philiff Eagles win the Super Bowl, and you know that, like,

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Speaker 7: your world's going to be different from there. This was

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Speaker 7: one of those moments. This was like the business version

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Speaker 7: of that moment. And we took a look at this,

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Speaker 7: and our first reaction is, thank god we have brands.

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Speaker 7: Because what we knew was this was going to be

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Speaker 7: a new Paradigmond Media, and we knew they were going

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Speaker 7: to be risks and they're going to be opportunities. And

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Speaker 7: we made the bet and had the thesis that says,

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Speaker 7: if you have these intangible assets that really really mean

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Speaker 7: something to people, you have something that is going to

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Speaker 7: increase in value in an artificial era. And starting in

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Speaker 7: twenty two and twenty three, we started to build other ways.

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Speaker 3: To distribute our brands.

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Speaker 7: TikTok, Instagram, YouTube, our own emails, product licening, all of

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Speaker 7: these things we did and cut to today, five years later,

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Speaker 7: we've made ten straight quarters on Wall Street. We're growing

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Speaker 7: in an area where most publishers are struggling, and we

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Speaker 7: did it because we have these amazing brands that can

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Speaker 7: live in all these places, and our aggregate audience size

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Speaker 7: is multiples what it was when we started here.

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Speaker 1: You mentioned that you do have licensing arrangements with some

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Speaker 1: of the LFS Large language models. How does that work

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Speaker 1: for you? Is it real money?

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Speaker 7: So it's real money, it's material for us. I think

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Speaker 7: we made a decision. Maybe it's right, maybe it's wrong.

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Speaker 7: So far, I think it's right that we wanted to

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Speaker 7: see to the table. The important thing to understand and

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Speaker 7: realize is a I need three things. It needs power,

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Speaker 7: which has been a lot to talk about power. It

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Speaker 7: needs a model. It's been a lot to talk about models,

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Speaker 7: and it needs inputs. We are the inputs. We are

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Speaker 7: the training of the models. Now we believe, and I

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Speaker 7: think if you talk to any of these AI professionals, believe.

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Speaker 3: The Internet's been crawled.

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Speaker 7: All the data in the world is already in the models.

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Speaker 3: So the value should accrue.

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Speaker 7: To those of us that are still making substantial amounts

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Speaker 7: of new things that are needed for the search use case,

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Speaker 7: which is a very big use case, and are needed

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Speaker 7: for all the corporate clients. Someone needs LMS for their stuff.

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Speaker 7: So it could be something simple as we have fifty

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Speaker 7: new recipes of the avocados of them and avocados are

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Speaker 7: important too. I can tell you every single thing Kim

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Speaker 7: Kardashian did yesterday. But these are things that are very valuable,

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Speaker 7: these pieces of data. The other thing we did, which

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Speaker 7: is really important here is part of having a seat

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Speaker 7: at the table, is we wanted to control our own destiny.

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Speaker 7: Last summer in July, we made a decision and we

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Speaker 7: partnered with a group called a cloud Flyer to block

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Speaker 7: every AI crawler you could possibly block, so you cannot

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Speaker 7: get access to our content unless you pay us for.

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Speaker 1: It and given your model to license the training. Using

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Speaker 1: your content to an LLM is basically found money, right.

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Speaker 1: It's not taking away from your other business because that's

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Speaker 1: based on brand.

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Speaker 7: I mean, so it's interesting, is it.

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Speaker 3: It's funny.

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Speaker 7: We have this conversation all the time, and the answer

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Speaker 7: we always come back to is cash is cash.

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Speaker 3: It would be amazing if we.

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Speaker 7: Can make money the way we made money through four years,

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Speaker 7: it'd be super fun. I have a lot more free time,

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Speaker 7: but I don't, and we have to work hard.

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Speaker 3: So it is what it is.

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Speaker 1: For a publisher with strong, well established brands, even the

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Speaker 1: uncertain future with AI be bright. But for smaller publishers

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Speaker 1: and for the Web as a whole, the outlook may

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Speaker 1: not be as encouraging potentially in the longer run. What

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Speaker 1: could this mean for the Internet itself, Because the Internet

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Speaker 1: really has thrived on very rich production of content. If

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Speaker 1: content providers don't get paid for that, sooner or later,

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Speaker 1: there's not going to be as much content.

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Speaker 4: Yeah, this death spiral that you're describing has been something

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Speaker 4: that people have theorized over the last three or four

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Speaker 4: years with no discernible solution. I'm going to tell you

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Speaker 4: what I think is the most likely scenario, but it's

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Speaker 4: also the most tragic one, which is that in a

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Speaker 4: few years, AI tools find themselves unable to get enough

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Speaker 4: content to train on, whether it's video or text or

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Speaker 4: audio long form short form, and they decide to build

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Speaker 4: their own publishing departments and in years to come, a decade,

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Speaker 4: two decades from now, it would not surprise me if

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Speaker 4: an AI or anthropic looked a lot like TikTok, where

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Speaker 4: they have a creator fund and they pay creators a

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Speaker 4: certain amount based on the amount of traffic, page views

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Speaker 4: and value to the training set that these creators provide,

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Speaker 4: and so they are contract employing these creators, and we

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Speaker 4: get an AI shaped internet, right, an internet that is

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Speaker 4: built not only for but by AI tools, that seems

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Speaker 4: quite probable.

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Speaker 6: I think that that is something that if I worked

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Speaker 6: at an AI company, I would really be thinking about,

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Speaker 6: because if the traffic drops so significantly that we see

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Speaker 6: even more jobs and journalism be lost, we see even

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Speaker 6: more especially local outlets, but a lot of news outlets

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Speaker 6: shutter themselves because they can't stay afloat That diminishes the

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Speaker 6: amount of content that these lms can train on too. Right,

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Speaker 6: So this is something that I think we should all

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Speaker 6: be concerned about, not just journalists but also those work

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Speaker 6: at AI companies. Anyone who cares about the future of

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Speaker 6: democracy should be thinking about this right.

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Speaker 1: Now, tell me how broadly, apart from people beyond people,

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Speaker 1: how do you think generative AI is going to change

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Speaker 1: the nature of the Internet, the content on the Internet.

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Speaker 7: Right, So, we can end up being fairly myopic around

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Speaker 7: here and looking at our own use case. I am,

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Speaker 7: and I have to be. I'm like a crazy optimistic person,

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Speaker 7: and I'm very optimistic about AI for us. Right the

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Speaker 7: risk for AI for us is already out, it's already

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Speaker 7: killed our biggest piece of traffic from five years ago.

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Speaker 7: But we've built something even better over here that we

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Speaker 7: use AI to do more of like we are today.

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Speaker 7: We make about fifty percent more content than we made

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Speaker 7: when this whole process started for roughly the same cost.

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Speaker 7: And humans make every single thing you read and see

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Speaker 7: because we've been able to use AI in the background

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Speaker 7: to streamline so many processes. If you look at as

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Speaker 7: an opportunity, it's incredible for us, and we have no

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Speaker 7: choice but to look at it that way. If we

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Speaker 7: look at it any other way, it's too scary, and

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Speaker 7: it's sort of like riding a bike. Don't look down,

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Speaker 7: look towards the horizon like and you'll be fine.

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Speaker 1: Since we talked with Neil Vogel, people inks parent company

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Speaker 1: made an offer to buy the part of MGM it

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Speaker 1: doesn't already own, and making the bid, Chairman Barry Diller

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Speaker 1: emphasized the value of what he called real world assets

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Speaker 1: that AI cannot easily replicate, pursuing a part of the

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Speaker 1: media world very different from the online content brands that

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Speaker 1: Vogel continues to build up. Next, we've come a long

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Speaker 1: way from Cape Canaveral. Today there's a booming business in

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Speaker 1: space launches, which means a long waiting list for satellites

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Speaker 1: trying to get into orbit, and the latest opportunity may

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Speaker 1: lie one thousand miles south of Florida in the Dominican Republic.

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Speaker 1: This is a story about making money twenty two thousand

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Speaker 1: miles up, meeting a commercial need for tens of thousands

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Speaker 1: of satellites to be launched by twenty thirty. There is

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Speaker 1: a race on to get all those satellites into orbit,

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Speaker 1: but also a race with China, which has already built

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Speaker 1: a range of satellite ground stations in Latin America, something

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Speaker 1: that's gotten the attention of the US government.

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Speaker 8: So it's about forty five minutes on a helicopter flight,

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Speaker 8: it's probably about four or five hours driving.

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Speaker 1: In the western part of the Dominican Republic, on the

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Speaker 1: border with Haiti lies Pedernalis, a quiet coastal province that

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Speaker 1: will soon be home to the country's first spaceport and

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Speaker 1: what is slated to be the first US owned commercial

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Speaker 1: spaceport in Latin America.

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Speaker 8: If they were to identify this region as ideal or

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Speaker 8: commercial space, may be essentially the Straits of Verboos or space.

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Speaker 1: When we talk about the Strait of Horror moves, we

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Speaker 1: think of all that oil and fertilizer and aluminum trying

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Speaker 1: to get through a narrow sea channel. When it comes

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Speaker 1: to space, its satellites, and the choke point isn't the

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Speaker 1: sea passage, but launch pads that we simply don't have

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Speaker 1: enough of. How many pads are you going to have

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Speaker 1: for four pads here?

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Speaker 3: Yeah.

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Speaker 1: Burton Catledge is a former Air Force kernel who founded

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Speaker 1: aerospace company Launch on Demand in twenty eighteen.

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Speaker 8: The amount of support that they came back with was amazing.

438
00:25:35,320 --> 00:25:38,760
Speaker 1: He's now developing a six hundred million dollar commercial spaceport

439
00:25:38,880 --> 00:25:41,360
Speaker 1: in this remote part of the Dominican Republic.

440
00:25:41,440 --> 00:25:44,600
Speaker 8: The ecosystem of Cape Canaveral more or less is grown

441
00:25:44,640 --> 00:25:45,439
Speaker 8: out of ad Hoc.

442
00:25:46,000 --> 00:25:46,680
Speaker 3: Okay, it has.

443
00:25:46,760 --> 00:25:49,920
Speaker 8: It was not necessarily built with the idea for the

444
00:25:49,920 --> 00:25:52,720
Speaker 8: commercial space industry. The entire market has changed.

445
00:25:52,880 --> 00:25:53,040
Speaker 1: You know.

446
00:25:53,080 --> 00:25:55,920
Speaker 8: Space industry is something on the orders. Last time I checked,

447
00:25:55,960 --> 00:25:58,760
Speaker 8: it was like six hundred and fifty billion dollars. They's

448
00:25:58,800 --> 00:26:02,840
Speaker 8: supposed to be over a troll in by twenty thirty,

449
00:26:02,840 --> 00:26:04,479
Speaker 8: maybe a trillion and a half, and some people are

450
00:26:04,480 --> 00:26:05,600
Speaker 8: even saying that's pretty low.

451
00:26:07,000 --> 00:26:09,639
Speaker 1: To relieve the bottleneck and launching the growing number of

452
00:26:09,680 --> 00:26:12,920
Speaker 1: satellites we need, the US has to have more spaceports,

453
00:26:13,359 --> 00:26:16,560
Speaker 1: creating a business opportunity for companies like launch on demand.

454
00:26:17,160 --> 00:26:20,399
Speaker 1: Right now, there are over a dozen US spaceports across

455
00:26:20,440 --> 00:26:24,879
Speaker 1: the country and just one internationally Rocket Labs launch site

456
00:26:24,960 --> 00:26:26,000
Speaker 1: in New Zealand.

457
00:26:26,280 --> 00:26:28,680
Speaker 9: I think the United States, from the space economy perspective,

458
00:26:28,720 --> 00:26:31,719
Speaker 9: is in a position of extreme opportunity and they are

459
00:26:31,760 --> 00:26:32,480
Speaker 9: in a growth phase.

460
00:26:32,960 --> 00:26:36,520
Speaker 1: Ryan Bruckart is a senior partner at McKinsey who focuses

461
00:26:36,560 --> 00:26:39,840
Speaker 1: on global aerospace, defense, and space companies.

462
00:26:40,160 --> 00:26:42,800
Speaker 9: I think the infrastructure in the US is becoming a

463
00:26:42,800 --> 00:26:44,720
Speaker 9: bit stretched right If you look at our launch sites,

464
00:26:44,720 --> 00:26:47,680
Speaker 9: we're launching every day or a couple times a day

465
00:26:47,680 --> 00:26:50,280
Speaker 9: from some of these launch sites. There's a huge backlog

466
00:26:50,359 --> 00:26:54,199
Speaker 9: of US companies looking to launch things into space and

467
00:26:54,320 --> 00:26:56,800
Speaker 9: to be able to accomplish their mission and get the

468
00:26:56,800 --> 00:26:58,240
Speaker 9: return that their investors are looking for.

469
00:26:58,359 --> 00:27:02,359
Speaker 8: Right now, I've heard that it's about three year waiting

470
00:27:02,400 --> 00:27:03,840
Speaker 8: list to get a satellite on orbit.

471
00:27:04,280 --> 00:27:07,119
Speaker 1: What accounts for that demand ramping up so dramatically and

472
00:27:07,240 --> 00:27:10,040
Speaker 1: do you expect it's going to continue to increase that much.

473
00:27:10,119 --> 00:27:13,040
Speaker 8: Well, in order to have global coverage of the entire Earth,

474
00:27:13,240 --> 00:27:15,440
Speaker 8: you have to have a lot of satellites. Right now,

475
00:27:15,480 --> 00:27:20,480
Speaker 8: there's about fourteen thousand satellites in orbit. The FCC tracks

476
00:27:20,480 --> 00:27:22,840
Speaker 8: all the number of satellites that are going to be submitted,

477
00:27:23,200 --> 00:27:25,679
Speaker 8: and they're looking at over one hundred thousand satellites by

478
00:27:25,720 --> 00:27:28,600
Speaker 8: twenty thirty. So if we got fourteen thousand satellites and

479
00:27:28,640 --> 00:27:31,200
Speaker 8: it's twenty twenty six already and we have to launch

480
00:27:31,200 --> 00:27:34,920
Speaker 8: one hundred thousand satellites by twenty thirty, that's a lot

481
00:27:34,960 --> 00:27:36,960
Speaker 8: of launches that have to happen between now and then.

482
00:27:37,560 --> 00:27:41,280
Speaker 1: That may explain the need for moral launch sites, but where.

483
00:27:41,359 --> 00:27:43,399
Speaker 8: The goal for a rocket is to get to space

484
00:27:43,640 --> 00:27:47,600
Speaker 8: in the most efficient and effective way possible, and engineers

485
00:27:47,640 --> 00:27:51,399
Speaker 8: spend hundreds of millions of dollars trying to finesse what

486
00:27:51,440 --> 00:27:53,680
Speaker 8: does that efficiency look like, But eventually it comes down

487
00:27:53,880 --> 00:27:56,480
Speaker 8: to two things. How much fuel can I put on

488
00:27:56,560 --> 00:27:59,000
Speaker 8: the rocket and how much mass can I put on

489
00:27:59,040 --> 00:28:01,680
Speaker 8: top of the lift. They're always playing with that equation. Well,

490
00:28:02,160 --> 00:28:06,639
Speaker 8: the geography has an important part in here this because

491
00:28:06,640 --> 00:28:09,119
Speaker 8: in order to achieve escape velocity, a rocket has to

492
00:28:09,160 --> 00:28:13,120
Speaker 8: achieve seventeen thousand, five hundred miles per hour, and the

493
00:28:13,200 --> 00:28:16,800
Speaker 8: Earth closer to the equator spins faster than it does

494
00:28:16,840 --> 00:28:19,960
Speaker 8: at the poles. What that translates into is you could

495
00:28:19,960 --> 00:28:23,800
Speaker 8: put more satellites up with less of a smaller rocket.

496
00:28:24,680 --> 00:28:27,080
Speaker 8: And so the goal of most spaceports is to try

497
00:28:27,119 --> 00:28:30,080
Speaker 8: and get to the as close to the equator as possible.

498
00:28:30,119 --> 00:28:32,400
Speaker 1: But why does it take me to dominic or republic?

499
00:28:32,760 --> 00:28:35,240
Speaker 8: So what we ended up doing about three years ago

500
00:28:35,359 --> 00:28:38,240
Speaker 8: was doing a technical feasibility study. Well looked at everything

501
00:28:38,280 --> 00:28:41,080
Speaker 8: we could possibly look at. But as we did our analysis,

502
00:28:41,160 --> 00:28:44,960
Speaker 8: it started shifting to paired analysis, which has a relatively

503
00:28:45,000 --> 00:28:48,480
Speaker 8: low population. And because it's on the coastline, and because

504
00:28:48,520 --> 00:28:51,280
Speaker 8: people don't live in the water, we have almost a

505
00:28:51,280 --> 00:28:54,960
Speaker 8: straight shot to orbit without hazarding the public.

506
00:28:55,120 --> 00:28:57,040
Speaker 3: So if something goes wrong, it goes in the ocean.

507
00:28:56,800 --> 00:28:59,000
Speaker 8: That's right. So that's why a lot of our spaceports

508
00:28:59,000 --> 00:29:01,320
Speaker 8: are built next to the coast. Is not necessarily because

509
00:29:01,360 --> 00:29:04,080
Speaker 8: of the water, it's because of the low population. It's

510
00:29:04,120 --> 00:29:06,880
Speaker 8: not really about whether the rocket explodes or whether the

511
00:29:06,960 --> 00:29:09,040
Speaker 8: rocket gets to orbit, it's all about public safety.

512
00:29:09,240 --> 00:29:12,240
Speaker 1: Safety is no small concern in the new space race,

513
00:29:12,520 --> 00:29:15,440
Speaker 1: as we saw just last month when Jeff Bezos' Blue

514
00:29:15,440 --> 00:29:18,920
Speaker 1: Origin rocket tests blew up in spectacular fashion and looked

515
00:29:19,000 --> 00:29:22,040
Speaker 1: up along with the expected trillion dollar IPO of Elon

516
00:29:22,160 --> 00:29:25,320
Speaker 1: Musk's SpaceX. It's a reminder of just how public the

517
00:29:25,360 --> 00:29:29,200
Speaker 1: failures and successes can be in this business and how

518
00:29:29,240 --> 00:29:30,240
Speaker 1: big the players are.

519
00:29:30,360 --> 00:29:31,840
Speaker 8: The pad will be two miles to the coast.

520
00:29:31,960 --> 00:29:34,560
Speaker 1: That's one reason that Burton would rather work with them

521
00:29:34,800 --> 00:29:38,160
Speaker 1: than against them. You are thought competitive with SpaceX right.

522
00:29:38,040 --> 00:29:40,240
Speaker 8: Most of the feedback that we have gotten from all

523
00:29:40,280 --> 00:29:43,840
Speaker 8: the commercial operators is they would like the ground infrastructure

524
00:29:43,880 --> 00:29:47,840
Speaker 8: to be more responsive, to be more not we launch

525
00:29:47,920 --> 00:29:50,400
Speaker 8: on this day. We launch on readiness, and right now

526
00:29:50,440 --> 00:29:53,720
Speaker 8: the infrastructure and the processes are not designed that way.

527
00:29:53,920 --> 00:29:59,760
Speaker 8: So right now, statutorily, the office Commercial Space has six

528
00:29:59,840 --> 00:30:02,920
Speaker 8: more to review it and give you decision. We're going

529
00:30:02,960 --> 00:30:05,440
Speaker 8: to give you a license in forty five days. That's

530
00:30:05,560 --> 00:30:09,280
Speaker 8: very attractive. We don't look at ourselves as competitors to

531
00:30:09,320 --> 00:30:11,480
Speaker 8: the rocket customers. We look at us as enablers.

532
00:30:11,600 --> 00:30:14,200
Speaker 1: What's the attraction for investors and what's been your experience

533
00:30:14,240 --> 00:30:16,520
Speaker 1: so far on people stepping up.

534
00:30:16,600 --> 00:30:19,760
Speaker 8: There is a large appetite right now for space. This

535
00:30:19,840 --> 00:30:23,479
Speaker 8: is kind of like the early early Internet age, if

536
00:30:23,520 --> 00:30:26,600
Speaker 8: you will. The problem is there's not very many investment

537
00:30:26,640 --> 00:30:29,600
Speaker 8: opportunities or good investment opportunities to get into space. The

538
00:30:29,640 --> 00:30:31,840
Speaker 8: first phase of the spaceport is going to be about

539
00:30:31,880 --> 00:30:35,840
Speaker 8: six hundred million dollars of investment, and the response that

540
00:30:35,840 --> 00:30:38,240
Speaker 8: we've got has been really quite significant.

541
00:30:39,320 --> 00:30:42,480
Speaker 1: As Launch on Demand prepares to break ground later this year,

542
00:30:43,000 --> 00:30:46,959
Speaker 1: a larger race is already underway. In Latin America. Space

543
00:30:47,040 --> 00:30:51,160
Speaker 1: infrastructure has become a new front in the US China rivalry.

544
00:30:51,480 --> 00:30:57,640
Speaker 10: China is aggressively making investments in our hemisphere, particularly in

545
00:30:57,760 --> 00:31:02,160
Speaker 10: Lantin and South America, and so partnerships that they have

546
00:31:02,320 --> 00:31:10,640
Speaker 10: made with Caribbean nations to have aerospace applications, satellite demonstrations,

547
00:31:10,640 --> 00:31:15,840
Speaker 10: civilian applications, also with military application components to it.

548
00:31:16,080 --> 00:31:18,760
Speaker 1: A recent report from the Select Committee on the Chinese

549
00:31:18,760 --> 00:31:23,120
Speaker 1: Communist Party warned about China's growing space footprint in the region,

550
00:31:23,600 --> 00:31:28,600
Speaker 1: including more than ten satellite tracking stations. Congresswoman Haley Stevens

551
00:31:28,640 --> 00:31:30,840
Speaker 1: of Michigan is a member of the committee.

552
00:31:31,080 --> 00:31:33,920
Speaker 10: This is a call to double down on the way

553
00:31:34,040 --> 00:31:36,080
Speaker 10: our system works, and so we don't want to be

554
00:31:36,120 --> 00:31:39,680
Speaker 10: seeding ground to China. We don't want to see them

555
00:31:40,720 --> 00:31:46,240
Speaker 10: continuing to eat our lunch with our neighbors and we

556
00:31:46,440 --> 00:31:47,720
Speaker 10: can win this race.

557
00:31:48,000 --> 00:31:49,479
Speaker 11: I guess you could look at it as a marathon,

558
00:31:49,600 --> 00:31:51,719
Speaker 11: or maybe an ultra marathon, But I don't see an

559
00:31:51,840 --> 00:31:54,040
Speaker 11: end here. There is not a clear finish line.

560
00:31:54,160 --> 00:31:59,080
Speaker 1: Carrie Bingen is a director of csis's Aerospace Security Project.

561
00:31:59,200 --> 00:32:02,240
Speaker 11: Well, I thought what was really interesting in the decades

562
00:32:02,280 --> 00:32:05,320
Speaker 11: that we were competing against the Soviet Union, so much

563
00:32:05,360 --> 00:32:08,000
Speaker 11: of what was happening in space it was fueled by government.

564
00:32:08,200 --> 00:32:10,400
Speaker 11: I think what you're seeing now, which really sets this

565
00:32:10,560 --> 00:32:13,800
Speaker 11: current era apart, is so much of what's happening in

566
00:32:13,840 --> 00:32:17,040
Speaker 11: space is commercial. Over eighty percent of the satellites on

567
00:32:17,120 --> 00:32:21,240
Speaker 11: orbit today are commercial systems, a lot from the United States,

568
00:32:21,760 --> 00:32:26,160
Speaker 11: SpaceX Starlink, but many other countries are now players in space.

569
00:32:26,440 --> 00:32:30,920
Speaker 11: The technology is much more distributed across the globe. Launch

570
00:32:30,960 --> 00:32:33,760
Speaker 11: costs are a lot cheaper, so any country or even

571
00:32:33,880 --> 00:32:36,680
Speaker 11: entity can put something in orbit, and much of that

572
00:32:36,760 --> 00:32:40,760
Speaker 11: is now fueled by private capital, not just tax payer dollars.

573
00:32:41,080 --> 00:32:46,800
Speaker 11: China has ambitions to be the world's space power. Their

574
00:32:46,880 --> 00:32:51,080
Speaker 11: presence and their capabilities in Latin America are part of

575
00:32:51,120 --> 00:32:55,200
Speaker 11: that strategy. They want access, they want influence, they want

576
00:32:55,240 --> 00:32:58,080
Speaker 11: to be able to band together with these countries in

577
00:32:58,160 --> 00:33:02,520
Speaker 11: bodies like the United Nations to start shaping where the

578
00:33:02,600 --> 00:33:03,320
Speaker 11: standards are.

579
00:33:03,480 --> 00:33:07,120
Speaker 8: We started this program well before people realize that China

580
00:33:07,480 --> 00:33:11,360
Speaker 8: was very interested in taking over real estate in Latin America.

581
00:33:11,520 --> 00:33:16,080
Speaker 8: As we have gotten, the Trump administration and President of

582
00:33:16,120 --> 00:33:20,640
Speaker 8: been the Their's administration together they are aligned on what

583
00:33:20,760 --> 00:33:24,040
Speaker 8: has been called, you know, the pivot to the Western Hemisphere.

584
00:33:24,560 --> 00:33:27,760
Speaker 8: So I would call the spaceport more of an artifact

585
00:33:28,080 --> 00:33:31,840
Speaker 8: of the decision to pivot to the Western hemisphere rather

586
00:33:31,880 --> 00:33:35,840
Speaker 8: than anything else. And we emphasize this is run by

587
00:33:35,880 --> 00:33:39,680
Speaker 8: a US company that is designed to be commercial, that

588
00:33:39,840 --> 00:33:44,160
Speaker 8: is complementary, not competitive with the spaceport and the United States,

589
00:33:44,680 --> 00:33:46,720
Speaker 8: and we work very very hard to make sure that

590
00:33:46,760 --> 00:33:49,920
Speaker 8: they understand we're a friend, not a foe, and so

591
00:33:49,920 --> 00:33:53,360
Speaker 8: so much so that when we have talked to the

592
00:33:53,400 --> 00:33:57,120
Speaker 8: President and there we said we want to adopt the

593
00:33:57,240 --> 00:34:02,200
Speaker 8: US safety standards for launching re entry and he agreed,

594
00:34:02,560 --> 00:34:04,440
Speaker 8: And so if you're a customer that launched from the

595
00:34:04,520 --> 00:34:06,840
Speaker 8: United States, the standard will be the same if you

596
00:34:06,960 --> 00:34:08,279
Speaker 8: launch from the Dominican Republic.

597
00:34:08,600 --> 00:34:11,320
Speaker 11: We have holes. We never thought that missiles would be

598
00:34:11,400 --> 00:34:14,600
Speaker 11: launched across the southern hemisphere. So we did not put

599
00:34:14,640 --> 00:34:17,800
Speaker 11: a lot of radars down in South America or in Africa,

600
00:34:17,800 --> 00:34:21,960
Speaker 11: for example, But we're realizing we need to have coverage

601
00:34:22,360 --> 00:34:26,319
Speaker 11: of everything that's happening in orbit. We're seeing China, We're

602
00:34:26,320 --> 00:34:31,440
Speaker 11: seeing Russia maneuver satellites much more frequently. Are they benign

603
00:34:31,680 --> 00:34:34,759
Speaker 11: or do they have a hidden weapon? We don't know,

604
00:34:34,840 --> 00:34:37,120
Speaker 11: but we know that they're testing these kind of capabilities,

605
00:34:37,160 --> 00:34:38,520
Speaker 11: and so you need to be able to monitor that.

606
00:34:38,760 --> 00:34:41,200
Speaker 1: Are there restrictions on who can use your spaceboard?

607
00:34:41,480 --> 00:34:47,160
Speaker 8: We want to stay in line with US foreign policy

608
00:34:47,680 --> 00:34:49,960
Speaker 8: and what do I mean by that? So even though

609
00:34:50,000 --> 00:34:52,600
Speaker 8: I'm a US company operating a Dominican republic, I need

610
00:34:52,640 --> 00:34:55,799
Speaker 8: to make sure that my host country, the US in

611
00:34:55,840 --> 00:34:59,120
Speaker 8: this case, is aligned with what I'm doing. So if

612
00:34:59,120 --> 00:35:01,680
Speaker 8: I sort of, you know, went kind of off the

613
00:35:02,200 --> 00:35:05,239
Speaker 8: beaten path, I would essentially be cutting myself up from

614
00:35:05,239 --> 00:35:07,759
Speaker 8: the largest commercial market in the world, which doesn't make

615
00:35:07,840 --> 00:35:08,320
Speaker 8: much sense.

616
00:35:09,920 --> 00:35:12,640
Speaker 1: Launch on demands. Being aligned with the US government on

617
00:35:12,680 --> 00:35:16,400
Speaker 1: the geopolitics of space infrastructure in Latin America is important

618
00:35:16,400 --> 00:35:20,040
Speaker 1: to catledge, But make no mistake, at its heart, this

619
00:35:20,280 --> 00:35:24,120
Speaker 1: US Spaceboort Company is a business one that catledge believes

620
00:35:24,160 --> 00:35:25,360
Speaker 1: will be a good one.

621
00:35:25,440 --> 00:35:28,479
Speaker 8: So we estimate that by about the ten year point

622
00:35:28,480 --> 00:35:30,799
Speaker 8: after we hit full operations, we'll be generating about eight

623
00:35:30,800 --> 00:35:34,280
Speaker 8: billion dollars. And so this will be the first private

624
00:35:34,719 --> 00:35:37,839
Speaker 8: revenue generating spaceport in the world. And the reason why

625
00:35:37,880 --> 00:35:40,920
Speaker 8: is was because we're leveraging all the technology that's been invented.

626
00:35:41,080 --> 00:35:42,160
Speaker 8: We're bringing that here.

627
00:35:43,600 --> 00:35:47,120
Speaker 1: Coming up from the Dominican Republic to Bolivia for a

628
00:35:47,160 --> 00:35:50,680
Speaker 1: look at another Latin American country chasing US investment. With

629
00:35:50,760 --> 00:36:07,000
Speaker 1: the president trying to shake things up. This is a

630
00:36:07,040 --> 00:36:11,440
Speaker 1: story of rebranding a country. Rodriguo Paz was elected president

631
00:36:11,560 --> 00:36:14,560
Speaker 1: of Bolivia in November, marking a major shift for the

632
00:36:14,600 --> 00:36:18,440
Speaker 1: country following two decades of socialist rule. Pause has a

633
00:36:18,480 --> 00:36:22,160
Speaker 1: mandate of economic reform, closer relations with the United States,

634
00:36:22,520 --> 00:36:26,279
Speaker 1: and increased foreign investment. But as our colleague David Goura

635
00:36:26,400 --> 00:36:32,160
Speaker 1: found out, ideas and execution are sometimes very different things.

636
00:36:34,840 --> 00:36:37,800
Speaker 2: The Salar Day of Uni in Bolivia is the country's

637
00:36:37,840 --> 00:36:41,960
Speaker 2: crown jewel. It's a sprawling salt flat on the Indian Altiplano,

638
00:36:42,440 --> 00:36:44,600
Speaker 2: so large it's visible from space.

639
00:36:45,120 --> 00:36:45,680
Speaker 3: We are at.

640
00:36:47,280 --> 00:36:51,600
Speaker 12: Three thousand, six hundred and fifty meters above sea level very.

641
00:36:51,480 --> 00:36:54,320
Speaker 3: High, very high.

642
00:36:54,560 --> 00:36:57,560
Speaker 2: Bolivia's economy benefits from the tourists who flocked to the

643
00:36:57,600 --> 00:37:00,920
Speaker 2: salar from all over the world. With the Tree's leadership

644
00:37:01,120 --> 00:37:05,320
Speaker 2: is banking on is what's underneath this snowlike layer of salt.

645
00:37:05,560 --> 00:37:08,640
Speaker 12: So the lithium mining that's not down on the circle.

646
00:37:09,000 --> 00:37:12,080
Speaker 12: The idea of the government was like those are manufacturing

647
00:37:12,239 --> 00:37:17,359
Speaker 12: batteries or electric cars, things like that. But you know

648
00:37:17,400 --> 00:37:19,279
Speaker 12: it takes a long time, of course, and also we

649
00:37:19,320 --> 00:37:21,840
Speaker 12: need some technology or from outside.

650
00:37:21,840 --> 00:37:23,799
Speaker 2: You know, we're standing on top of one of the

651
00:37:23,920 --> 00:37:28,279
Speaker 2: largest lithium resources in the world, and President Rodrigo pad

652
00:37:28,360 --> 00:37:31,399
Speaker 2: says if the country can develop these reserves, it will

653
00:37:31,440 --> 00:37:35,680
Speaker 2: transform Bolivia's struggling economy, improving the lives of some twelve

654
00:37:35,760 --> 00:37:36,719
Speaker 2: million Bolivians.

655
00:37:37,000 --> 00:37:42,000
Speaker 13: Peru, Peru, Bolivia, and Chili collectively holds the largest concentration

656
00:37:42,080 --> 00:37:48,640
Speaker 13: of minerals in the world. Perue generates fifty billion dollars annually,

657
00:37:48,719 --> 00:37:51,800
Speaker 13: Chili generates sixty five billion dollars annually.

658
00:37:52,760 --> 00:37:57,040
Speaker 5: Go mil mionis de dol Alana Bolivia.

659
00:37:57,400 --> 00:38:01,000
Speaker 13: Bolivia possesses the highest concentration of innerals of the three,

660
00:38:01,520 --> 00:38:04,680
Speaker 13: yet we generate only six billion dollars.

661
00:38:04,320 --> 00:38:06,040
Speaker 3: Per year la preundace.

662
00:38:06,360 --> 00:38:08,840
Speaker 13: The question is why do we choose to be poor?

663
00:38:09,960 --> 00:38:13,640
Speaker 2: After he was elected last October, President Pause signaled Bolivia

664
00:38:13,840 --> 00:38:17,239
Speaker 2: is open for business. But as we discovered, there is

665
00:38:17,280 --> 00:38:20,880
Speaker 2: a disconnect between his rhetoric and the realities on the ground.

666
00:38:21,480 --> 00:38:23,480
Speaker 2: We arrived in the Pause to sit down with the

667
00:38:23,480 --> 00:38:28,600
Speaker 2: president as violent protests erupted across the country, shut down

668
00:38:28,600 --> 00:38:30,640
Speaker 2: parts of the city. We got the go ahead to

669
00:38:30,680 --> 00:38:33,880
Speaker 2: climb through barricades part of a police perimeter that protected

670
00:38:33,880 --> 00:38:38,520
Speaker 2: Bolivia's parliament building and presidential palace. We were told to

671
00:38:38,520 --> 00:38:42,800
Speaker 2: wait in a cafe on a mostly empty plaza, and

672
00:38:42,880 --> 00:38:46,160
Speaker 2: as the hours ticked by, we could hear protesters just

673
00:38:46,200 --> 00:38:52,239
Speaker 2: a few blocks away throwing dynamite. Tear gas hung in

674
00:38:52,280 --> 00:38:58,640
Speaker 2: the air. President Pause, we learned, was locked in tense negotiations.

675
00:38:59,160 --> 00:39:01,200
Speaker 2: Just before midnight, we got word from one of his

676
00:39:01,280 --> 00:39:06,120
Speaker 2: advisers the President would have to postpone our interview. One

677
00:39:06,120 --> 00:39:08,759
Speaker 2: week later, we finally got our chance to talk with him.

678
00:39:09,000 --> 00:39:11,959
Speaker 3: It's been a busy week. Three weeks, three weeks.

679
00:39:12,200 --> 00:39:15,160
Speaker 2: Many of these protesters are calling on you to resign,

680
00:39:15,480 --> 00:39:17,959
Speaker 2: to step down, and I'm wondering if there's a point

681
00:39:17,960 --> 00:39:20,440
Speaker 2: at which that will become something that you would consider

682
00:39:20,880 --> 00:39:22,120
Speaker 2: the Akia sink.

683
00:39:23,040 --> 00:39:26,640
Speaker 13: In five years from now, when we conclude our administration,

684
00:39:27,239 --> 00:39:31,120
Speaker 13: Bolivia will be an advanced nation, grounded in a modernity

685
00:39:31,239 --> 00:39:34,600
Speaker 13: made necessary by new institutions.

686
00:39:34,880 --> 00:39:38,600
Speaker 3: On this on a lucha frontal con.

687
00:39:39,920 --> 00:39:44,080
Speaker 13: A frontal assault on corruption, a controlled fiscal deficit, and

688
00:39:44,120 --> 00:39:48,440
Speaker 13: a clear path towards growth within an open economy governed

689
00:39:48,480 --> 00:39:49,319
Speaker 13: by clear.

690
00:39:49,160 --> 00:39:50,560
Speaker 3: Laws glad us.

691
00:39:51,280 --> 00:39:56,240
Speaker 13: But moreover, it will be a country where racial, regional,

692
00:39:56,280 --> 00:39:59,960
Speaker 13: and cultural differences are not exploited to feel political conflict,

693
00:40:00,719 --> 00:40:03,360
Speaker 13: where I hope I will leave behind a government characterized

694
00:40:03,400 --> 00:40:05,040
Speaker 13: by pluralistic participation.

695
00:40:05,840 --> 00:40:10,200
Speaker 3: Don de spero jarungovierno de participas plural.

696
00:40:11,160 --> 00:40:14,879
Speaker 2: At a precarious moment for his presidency, Ridrico Pas has

697
00:40:14,880 --> 00:40:18,640
Speaker 2: gotten public support from the Trump administration Secretary of State

698
00:40:18,719 --> 00:40:22,120
Speaker 2: Marco Rubio that the United States stands squarely in support

699
00:40:22,160 --> 00:40:25,520
Speaker 2: of Bolivia's government. Trump and his team have embraced PAS's

700
00:40:25,600 --> 00:40:28,520
Speaker 2: new vision for Bolivia, as they've welcomed wins by other

701
00:40:28,719 --> 00:40:30,680
Speaker 2: center right politicians in Latin America.

702
00:40:32,200 --> 00:40:35,960
Speaker 13: PRESIDENTA Trump I met with President Trump. There is a

703
00:40:36,000 --> 00:40:41,720
Speaker 13: relationship regarding the geopolitical and geoeconomic vision on the continental level.

704
00:40:42,680 --> 00:40:47,360
Speaker 13: Bolivia's vision is very clear. Pragmatic is everything that is

705
00:40:47,400 --> 00:40:51,040
Speaker 13: functional for the development of our economy, of the economy

706
00:40:51,080 --> 00:40:53,400
Speaker 13: of the people. We will be seated so that we

707
00:40:53,480 --> 00:40:55,960
Speaker 13: can collaborate and be part of a global vision.

708
00:40:57,800 --> 00:41:00,920
Speaker 14: I think that investors in general, we should have the

709
00:41:00,960 --> 00:41:05,640
Speaker 14: patience to follow the situation and see, you know, how

710
00:41:05,760 --> 00:41:06,959
Speaker 14: well he pulls it off.

711
00:41:07,480 --> 00:41:11,719
Speaker 2: Hans Humes had spent his career investing in frontier Markets's

712
00:41:11,760 --> 00:41:14,560
Speaker 2: the chairman and CEO of gray Lock Capital, and.

713
00:41:14,600 --> 00:41:22,000
Speaker 14: The markets generally give a pretty positive tailwind when a

714
00:41:22,040 --> 00:41:25,560
Speaker 14: writ of center government comes in. So getting the enthusiasm,

715
00:41:25,719 --> 00:41:28,440
Speaker 14: putting it out there, saying we're open for investment, great,

716
00:41:28,920 --> 00:41:31,440
Speaker 14: and then tapping the markets when they did, raising a

717
00:41:31,480 --> 00:41:33,600
Speaker 14: billion dollars. I think, you know, it's a good signal.

718
00:41:33,800 --> 00:41:38,719
Speaker 14: Everybody knows the Olivia story. It's an incredibly you know,

719
00:41:39,040 --> 00:41:43,440
Speaker 14: commodity wise, it's kind of hard not to see it

720
00:41:43,480 --> 00:41:45,960
Speaker 14: as a really easy place to make money. It's just

721
00:41:46,480 --> 00:41:49,440
Speaker 14: the sort of the ethnic tensions there that have always existed,

722
00:41:49,880 --> 00:41:51,719
Speaker 14: and the fact that they have a tradition of going

723
00:41:51,719 --> 00:41:53,440
Speaker 14: out in the streets. There's been a lot of turnover

724
00:41:53,480 --> 00:41:56,280
Speaker 14: of governments and as we're seeing now, it's pretty easy

725
00:41:56,680 --> 00:41:59,320
Speaker 14: to sort of choke the economy.

726
00:41:59,520 --> 00:42:02,319
Speaker 2: Doing business in Bolivia has not been easy, and there's

727
00:42:02,360 --> 00:42:06,120
Speaker 2: been talk of harnessing its lithium for decades. Today, a

728
00:42:06,160 --> 00:42:08,680
Speaker 2: lithium plant owned by the state is running at just

729
00:42:08,760 --> 00:42:12,640
Speaker 2: fifteen percent of capacity, and contracts that Chinese and Russian

730
00:42:12,680 --> 00:42:16,960
Speaker 2: companies signed with Pauz's predecessor haven't been ratified by Bolivia's Congress.

731
00:42:18,040 --> 00:42:20,799
Speaker 2: In the near term, Bolivia wants to boost tourism as

732
00:42:20,840 --> 00:42:23,960
Speaker 2: a source of revenue, but the longer term vision is

733
00:42:24,000 --> 00:42:25,760
Speaker 2: to do more with its minerals.

734
00:42:25,800 --> 00:42:25,960
Speaker 5: Well.

735
00:42:25,960 --> 00:42:29,880
Speaker 15: The country's never been closed for business, right. There's always

736
00:42:29,960 --> 00:42:34,279
Speaker 15: been foreign investors coming in and there's always been the

737
00:42:34,360 --> 00:42:37,520
Speaker 15: ability to do business, but there was always difficulties with

738
00:42:37,680 --> 00:42:38,640
Speaker 15: the administration.

739
00:42:39,360 --> 00:42:42,160
Speaker 2: Jorgeen Chaustay is a senior partner at the law firm

740
00:42:42,280 --> 00:42:45,040
Speaker 2: Denton's based in La Paz, and he spends a lot

741
00:42:45,080 --> 00:42:48,040
Speaker 2: of his time working with foreign investors on deals involving

742
00:42:48,080 --> 00:42:49,560
Speaker 2: Bolivia's natural resources.

743
00:42:50,080 --> 00:42:54,359
Speaker 15: Foreign investors are a little weary and concerned right that

744
00:42:54,400 --> 00:42:57,160
Speaker 15: their rights won't be respected right and they won't be

745
00:42:57,200 --> 00:42:59,759
Speaker 15: able to carry out the project and the terms that

746
00:42:59,800 --> 00:43:03,719
Speaker 15: they that they want. One of the main things in

747
00:43:03,760 --> 00:43:05,600
Speaker 15: some strategic sectors.

748
00:43:05,719 --> 00:43:06,520
Speaker 3: Was that you needed to.

749
00:43:06,440 --> 00:43:09,719
Speaker 15: Be in an agreement with the government, and to the

750
00:43:09,760 --> 00:43:15,080
Speaker 15: extent that you weren't able to have a security that

751
00:43:15,080 --> 00:43:18,000
Speaker 15: the government was going to actually, you know, comply with

752
00:43:18,040 --> 00:43:21,960
Speaker 15: their side of the agreement. That was a complicated situation.

753
00:43:22,400 --> 00:43:25,640
Speaker 15: If the government had too much of a say right

754
00:43:25,719 --> 00:43:28,600
Speaker 15: and you were not in a position to you know,

755
00:43:30,360 --> 00:43:35,080
Speaker 15: make your rights upheld, then of course that gives everyone pause.

756
00:43:35,760 --> 00:43:39,839
Speaker 15: The fact that the Bolivia left the Exit Convention and

757
00:43:40,480 --> 00:43:45,920
Speaker 15: was reluctant to enter into international arbitration agreements that gave

758
00:43:45,960 --> 00:43:47,200
Speaker 15: a lot of investors pause.

759
00:43:47,480 --> 00:43:48,120
Speaker 3: What needs to.

760
00:43:48,080 --> 00:43:50,799
Speaker 2: Happen over the course of the next year. President Pause

761
00:43:50,840 --> 00:43:53,600
Speaker 2: as a five year term, but for Bolivia to get

762
00:43:53,680 --> 00:43:55,080
Speaker 2: on track in the way that he wants it to,

763
00:43:55,400 --> 00:43:57,840
Speaker 2: what needs to happen in a year's time they need to.

764
00:43:57,840 --> 00:44:01,200
Speaker 15: See results of some sort, right, so some of those

765
00:44:01,239 --> 00:44:05,120
Speaker 15: results have already been seen. Right, We need to stabilize

766
00:44:05,120 --> 00:44:05,799
Speaker 15: the economy.

767
00:44:06,960 --> 00:44:10,239
Speaker 2: To do that, Bolivia has turned to the International Monetary Fund.

768
00:44:10,600 --> 00:44:14,239
Speaker 2: It's in negotiations for a three billion dollar package that

769
00:44:14,360 --> 00:44:19,120
Speaker 2: Pause says would go towards social organizations, entrepreneurship, and economic development.

770
00:44:20,520 --> 00:44:24,000
Speaker 2: But just six months into preston Pause's term, Many Bolivians

771
00:44:24,080 --> 00:44:27,400
Speaker 2: seem to be running out of patients. Protests have followed

772
00:44:27,400 --> 00:44:30,560
Speaker 2: his decision to cut fuel subsidies, and with inflation at

773
00:44:30,600 --> 00:44:34,760
Speaker 2: fourteen percent as recently as April, the pressure has mounted.

774
00:44:35,400 --> 00:44:38,359
Speaker 2: But the calls for Pause to step down go beyond economics.

775
00:44:38,760 --> 00:44:41,920
Speaker 2: Some opposition groups have sought to force him from office entirely,

776
00:44:42,200 --> 00:44:46,960
Speaker 2: and the blockades they've erected are now causing shortages of food, gasoline,

777
00:44:47,080 --> 00:44:51,520
Speaker 2: and medical supplies. Do you see any missteps things he

778
00:44:51,520 --> 00:44:53,680
Speaker 2: could have done differently or should have done differently?

779
00:44:53,840 --> 00:44:58,200
Speaker 14: Pulling away subsidies, it's a uh. It's the right thing

780
00:44:58,239 --> 00:45:02,799
Speaker 14: to do, it's a wrong thing to do if you

781
00:45:02,800 --> 00:45:05,759
Speaker 14: don't manage it well. One of the problems that you

782
00:45:05,880 --> 00:45:10,560
Speaker 14: see in a lot of these countries, whether it's Ecuador, Bolivia,

783
00:45:11,280 --> 00:45:14,160
Speaker 14: is you know, you want to head off people going

784
00:45:14,440 --> 00:45:17,319
Speaker 14: into the street, so maybe.

785
00:45:17,040 --> 00:45:19,000
Speaker 3: They're He should have.

786
00:45:21,280 --> 00:45:26,040
Speaker 14: Tried to have a bit of a negotiation on the

787
00:45:26,080 --> 00:45:32,560
Speaker 14: timing of removing subsidies, slowwalking it. He probably should have

788
00:45:32,800 --> 00:45:37,200
Speaker 14: recognized it. Stylistically he might have wanted to do with Malay,

789
00:45:37,640 --> 00:45:43,879
Speaker 14: but practically speaking, he didn't have you know, he didn't

790
00:45:43,920 --> 00:45:48,360
Speaker 14: have the national support that Malay did.

791
00:45:49,640 --> 00:45:52,200
Speaker 2: I imagine there are investors outside the country who are

792
00:45:52,200 --> 00:45:56,680
Speaker 2: watching what's unfolding in Bolivia and wondering how much has changed,

793
00:45:56,840 --> 00:45:59,279
Speaker 2: if it's still status quo, that there were protests and

794
00:45:59,320 --> 00:46:03,799
Speaker 2: demonstration and overarching uncertainty. What would you say to those

795
00:46:03,840 --> 00:46:07,120
Speaker 2: investors or those prospective investors about what Bolivia is like

796
00:46:07,160 --> 00:46:09,560
Speaker 2: today and how welcoming Bolivia is of outside investment.

797
00:46:10,800 --> 00:46:12,960
Speaker 3: Nos prometiro beanos.

798
00:46:13,280 --> 00:46:17,040
Speaker 13: We were promised twenty years of the possibility of becoming

799
00:46:17,120 --> 00:46:21,000
Speaker 13: a Switzerland. That was the promise made twenty years ago.

800
00:46:21,840 --> 00:46:25,880
Speaker 13: Twenty years later, they have left behind a shattered economy,

801
00:46:26,320 --> 00:46:30,120
Speaker 13: stripped of the natural resources such as hydrocarbons that we

802
00:46:30,160 --> 00:46:36,920
Speaker 13: would otherwise export, but a politic we possess abundant hydrocarbon reserves.

803
00:46:37,200 --> 00:46:40,520
Speaker 13: Yet they have left us without the necessary investments and

804
00:46:40,560 --> 00:46:44,080
Speaker 13: without the security required to ensure that those wishing to

805
00:46:44,160 --> 00:46:49,320
Speaker 13: invest in Bolivia find clear rules and laws during this transition,

806
00:46:49,920 --> 00:46:56,200
Speaker 13: laws that would foster an investment safe environment in Bolivia.

807
00:46:56,560 --> 00:47:00,239
Speaker 2: President Pause is pushing for changes to Bolivia's legal framework

808
00:47:00,280 --> 00:47:03,439
Speaker 2: to make the country more business friendly. He's still making

809
00:47:03,440 --> 00:47:07,040
Speaker 2: his pitch to the Bolivian people and also to outside investors.

810
00:47:07,560 --> 00:47:10,480
Speaker 2: The country just held its first dollar denominated bond sale

811
00:47:10,640 --> 00:47:13,440
Speaker 2: in almost five years. What would it take for you

812
00:47:13,480 --> 00:47:16,880
Speaker 2: personally to invest in Bolivia at this point in time.

813
00:47:16,719 --> 00:47:18,520
Speaker 14: We own some of the bonds. I mean, we're already

814
00:47:18,520 --> 00:47:20,640
Speaker 14: in there. We're bond guys. I'm not gonna buy a

815
00:47:20,680 --> 00:47:22,920
Speaker 14: lithium mine. I have friends who might be. You know,

816
00:47:23,040 --> 00:47:25,239
Speaker 14: I just wouldn't know what to do with it. But yeah,

817
00:47:25,280 --> 00:47:27,880
Speaker 14: I think the risk reward now, it's tricky. I'm not

818
00:47:27,920 --> 00:47:30,880
Speaker 14: gonna put fifty percent of the portfolio in it, but

819
00:47:30,920 --> 00:47:33,239
Speaker 14: I think it's a good risk return. We've had a

820
00:47:33,280 --> 00:47:36,680
Speaker 14: lot of bad headlines. I'm willing to keep the focus

821
00:47:36,719 --> 00:47:39,080
Speaker 14: there because the Macros story is a.

822
00:47:39,080 --> 00:47:41,000
Speaker 3: Good one.

823
00:47:42,040 --> 00:47:43,839
Speaker 1: That does it for us Here at Wall Street Week,

824
00:47:44,080 --> 00:47:47,040
Speaker 1: I'm David Weston. See you next week for more stories

825
00:47:47,160 --> 00:48:00,000
Speaker 1: of capitalism.