Speaker 1: This is Bloomberg Business Week. I'm Carol Masser and I'm
Speaker 1: Bloomberg Quick Takes Tim Stanovik. We're here every day bringing
Speaker 1: you the latest news from the world to business and finance,
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Speaker 1: You can also listen to our radio show at two
Speaker 1: pm Eastern Time on Bloomberg Radio, or watch us on
Speaker 1: YouTube search Bloomberg Global News. Well, I'm eager to get
Speaker 1: to our next guest, Dr lag Day Williams, who's Chief
Speaker 1: of Staff of Neurology at Columbia University. He's also the
Speaker 1: founder of Hip Hop Public Health. It works in the
Speaker 1: public sector to address health and equities and to bring
Speaker 1: vital information to underserved communities through the power of art,
Speaker 1: music and science. Dr lage Day Williams has joined us
Speaker 1: before on the show several times. Dr Williams, how are you.
Speaker 1: I'm doing well. Thanks for having me back. It's great
Speaker 1: to have you back. I want to start with we
Speaker 1: don't have a lot of time, so I want to
Speaker 1: get right to it. And what you're doing with hip
Speaker 1: hop public health, what you're focusing on right now is
Speaker 1: helping to reach underserved communities of color with the vaccine.
Speaker 1: And I'm looking right now at the New York City
Speaker 1: government website that shows data for different demographics with regard
Speaker 1: to how what portion of their population has been vaccinated. Um,
Speaker 1: white people in New York City have been vaccinated. That
Speaker 1: compares to of Hispanic and Latino and of Black New Yorkers.
Speaker 1: Why are we continuing to see this disparity? So it's
Speaker 1: a multiple reasons west seeing. But if you drill deeper
Speaker 1: into the numbers, that has been progressed across the board,
Speaker 1: but the disparity is still very real. Um, if if
Speaker 1: you extrapolate across the country, you look at the national data,
Speaker 1: we've actually, uh, Hispanics are doing very very well. Of
Speaker 1: his Flanics have been vaccinated according to recent trends, versus
Speaker 1: that total shaff the population, which is about seventeen percent.
Speaker 1: But still if you look at the if youok at
Speaker 1: the African American data among blacks, uh, you know we
Speaker 1: have also surpassed our share of the total population with
Speaker 1: about thirteen percent across the country been vaccinated versus you know,
Speaker 1: twelve percent to total share. But I completely agree there
Speaker 1: is still a tremendous amount of work that's left to
Speaker 1: be done. You know, I've always said that building trust,
Speaker 1: you know, isn't done overnight. It takes time. The real
Speaker 1: challenges that we are racing against time in this situation,
Speaker 1: we're racing against the variant, and so I think we
Speaker 1: just need to continue to increase, escalate an ant, intensify
Speaker 1: our efforts across multiple levels UM and get to the
Speaker 1: place where we actually get to a door to door
Speaker 1: vaccination campaign UM and UM and really hyper localifed messaging
Speaker 1: adored or vaccination campaign sort of like what we what
Speaker 1: we see with the census every ten years. If you
Speaker 1: don't fill it out, somebody comes to your door and
Speaker 1: knocks on it right exactly exactly. And that's difficult though
Speaker 1: to do, especially with the two shot vaccine. It works
Speaker 1: with a one shot vaccine, the Johnson and Johnson shot,
Speaker 1: but how do we know that somebody will be there
Speaker 1: the second time around. It's it's a challenge to it's
Speaker 1: a huge challenge. But you know, if I always said,
Speaker 1: this is you know, this is the United States of America.
Speaker 1: We have we have we have you know, robots on
Speaker 1: Mars right now. We you know, there's nothing beyond our
Speaker 1: capacity to accomplish. And I think that we just need
Speaker 1: to bring you know, the best minds together. But more
Speaker 1: importantly than the best minds, we need really glass roots
Speaker 1: approaches to the solution. I've always said, um, you know,
Speaker 1: the closer you are to a problem, you know, the
Speaker 1: closer you are to a solution. And so we need
Speaker 1: to get people who are actually living in and with
Speaker 1: the problem, and we need to figure out a way
Speaker 1: to work with them to attract you know, scalable solutions.
Speaker 1: And I'm sure there are examples in some smaller communities
Speaker 1: across across the country where success has been you know,
Speaker 1: has been seen in communities of color. Um. But you know,
Speaker 1: and so I think that we need to you know,
Speaker 1: take these best practices and scale them up. What are
Speaker 1: some of these best practices because you said it starts
Speaker 1: with trust and the idea of communicating. And I know
Speaker 1: several people that have yet to get a vaccine, and
Speaker 1: and and they're concerned, they have concerns, they want to wait,
Speaker 1: they say it's new. What's the right messaging here, Well,
Speaker 1: the right messaging is the for ust acknowledge and be
Speaker 1: non judgmental when discussing these issues with someone who is
Speaker 1: skeptical or hesitant or lacked confidence. I mean, we also
Speaker 1: have to acknowledge that there's certain people no matter what
Speaker 1: we say or do, UM will will continue to refuse.
Speaker 1: But I do think that there are still a number
Speaker 1: of people who can be persuaded. But again, it's gonna take, um,
Speaker 1: you know, really real, you know, personalized efforts UM to
Speaker 1: really identify uh you know networks UH, and leaders within networks,
Speaker 1: credible messengers, champions within these networks who are open to
Speaker 1: the vaccination message or or or have themselves being vaccinated
Speaker 1: and working with these you know, these these these leaders,
Speaker 1: these messengers, these uh you know, credible individuals with it
Speaker 1: what work with that networks? UM. And and it has
Speaker 1: to be one to one, it has to be one
Speaker 1: on one UH persuades. You know. At Columbia where I am,
Speaker 1: for example, UM, you know, we have multi layers of
Speaker 1: interventions all the way down to those one on one
Speaker 1: conversations with people that you trust. And I think that
Speaker 1: you know, I don't think that um uh, you know,
Speaker 1: copper carpet bombing messages are gonna work. I think we've
Speaker 1: already plucked all the low hanging fruits from that type
Speaker 1: of approach. I think we're now down to that door
Speaker 1: to door, that one on one conversations with people that
Speaker 1: people trust. Yeah, well this is where the real work
Speaker 1: really begins. And speaking of that, when we love about
Speaker 1: thirty seconds left, But I want to get to some
Speaker 1: of what else you're doing at Hip Hop Public Health
Speaker 1: because it's not just about the vaccine, oh absolutely not,
Speaker 1: absolutely not. You know, we address health disparities and health inequity, um,
Speaker 1: you know, as a as a whole, and we identify
Speaker 1: areas where communication that's been great comity of communications with
Speaker 1: certain communities, and we take our our approach, which is
Speaker 1: a really scientifically embedded, you can evident approach motivating the
Speaker 1: change in the community. Right, Dr Williams, we unfortunately have
Speaker 1: to leave it there this time this Dr lager Day Williams,
Speaker 1: chief of staff of Neurology, also found at Hip Hop
Speaker 1: Public Health. Bloomberg Philanthropies has provided in grant to Hip
Speaker 1: Hop Public Health. He's also a chief of staff Neurology
Speaker 1: at Columbia University chairs of d D SHO Shing d
Speaker 1: D and Inc. I should say, the parent company of
Speaker 1: d D SHO Shing Uh the a d r s
Speaker 1: right now lower by more than twenty point five per cent,
Speaker 1: absolutely plunging just a few days after going public. Here
Speaker 1: in the United States. Matt Turner is stocks reporter at
Speaker 1: Bloomberg News. He joins us now on the phone from
Speaker 1: wee Hawk in New Jersey. Matt, let's start at the
Speaker 1: beginning here, slide like this all because of regulatory crackdown
Speaker 1: in China. Give us the details here. What's going on?
Speaker 1: That's him, thanks. I mean, this all sort of started
Speaker 1: last week. We saw the we saw the idea where
Speaker 1: they raised four point four billion dollars um and you know,
Speaker 1: share us kind of climbed in the first few days
Speaker 1: of trading and really pulled their market cap up close
Speaker 1: to eight billion. But then, um, you know, Friday, we
Speaker 1: had regulators in China come out saying that they were
Speaker 1: going to launch this cybersecurity review into the company and
Speaker 1: they had halted the registration of new users, and we
Speaker 1: saw shares kind of trade lower on Friday, and then
Speaker 1: you that really escalated over the weekend, we saw they
Speaker 1: expanded that probe into two other firms, including d D,
Speaker 1: and they also have the app stores to actually remove
Speaker 1: their apps from the app stores completely. Um So, obviously
Speaker 1: that leads us into this morning where we saw you know,
Speaker 1: shares really really take a nose, that they were down
Speaker 1: as much in pre market, and then you know, as
Speaker 1: you said, now they're they're still down well over today. Look,
Speaker 1: this was obviously not priced in. When you see a
Speaker 1: a a decline like this, a move of this magnitude,
Speaker 1: this is something that was unexpected by regulator regulatory authorities.
Speaker 1: I'm thinking, you know about the timing here, right, just
Speaker 1: a few days after the company goes public. What do
Speaker 1: we know about what the Chinese government has said to
Speaker 1: d D and how they feel about it going public
Speaker 1: in the US. Yeah, I mean it's a little unclear.
Speaker 1: We've had the Wall Street Journal report earlier that the
Speaker 1: Chinese regulators may have actually warned d D as as
Speaker 1: far back as three months ago and had asked them
Speaker 1: to delay that i p O. Obviously that wasn't the case. Um.
Speaker 1: D D in fact even flagged in the regulatory filings
Speaker 1: for the I p O that there were some sort
Speaker 1: of you know, there were those anti trust concerns and
Speaker 1: they weren't actually sure uh you know, if those would
Speaker 1: be resolved fully, uh you know, if they were going
Speaker 1: to face more fines in the future. Um. So it
Speaker 1: was something that may not necessarily have been priced into
Speaker 1: the stock, but it was definitely um you know, if
Speaker 1: you kind of dug into the the filings and even
Speaker 1: uh you know, spoke to some of those people in
Speaker 1: analysts in China. Um, you know, it was a concern
Speaker 1: at least inside the company. There's also just the latest
Speaker 1: in sort of a crackdown on Chinese companies um as
Speaker 1: you and flip a right in the story, Investors worried
Speaker 1: that the latest security based probes have vopmened a new
Speaker 1: front in Xijian things broader campaign against China's internet giants
Speaker 1: that began in November with the collapse of Aunt Group
Speaker 1: companies thirty five billion dollar I p O and subsequent
Speaker 1: anti trust investigations into Ali, Baba and Matwan. I'm wondering
Speaker 1: how investors are digesting this news when it comes to
Speaker 1: other tow A d r s of other Chinese companies
Speaker 1: that are listed here in the US. Yeah, it's it's
Speaker 1: been a pretty broad based sell off today. UM. We
Speaker 1: we had looked earlier at you know, all these Chinese
Speaker 1: firms that have actually I POD this year. There are
Speaker 1: thirty seven that have started trading uh since we started. UM.
Speaker 1: And of that group, uh, thirty one of those were
Speaker 1: lower at this point, uh, you know, as about half
Speaker 1: an hour ago. So you know, it's a pretty broad
Speaker 1: based selloff. You know, even shares of Goldman and Morgan Stanley,
Speaker 1: who were both underwriters of this d D I p
Speaker 1: O we're lower today. So it's kind of it's hitting
Speaker 1: every everyone that's involved, and you know, even even some
Speaker 1: of those antilary stocks that are not obviously directly linked
Speaker 1: to d D. So does this make Chinese companies that
Speaker 1: are thinking about listening in the United States? Does this
Speaker 1: make them think twice about doing that? Yeah, I mean
Speaker 1: from everybody that we've talked to, you know, this is
Speaker 1: this is something that uh, you know, the analysts are
Speaker 1: saying is going to be a concern for some of
Speaker 1: these ideas that are going forward, even some of the
Speaker 1: ones that are are planned for later this year. UM.
Speaker 1: And it is part of that push that we've seen
Speaker 1: from from China and from Jun pink to to try
Speaker 1: and get these Chinese firms to list domestically, you know,
Speaker 1: in Hong Kong and in China as opposed to listening
Speaker 1: in the US market. Yeah, I I wonder match. Just
Speaker 1: in the last ten seconds, we have what analysts are
Speaker 1: saying about the business. How this actually affects the company's
Speaker 1: business if people can't new customers can't download the app, yeah,
Speaker 1: I mean for now, you know, it's a little unclear
Speaker 1: they're saying that. You know, like we've seen some of
Speaker 1: the other crackdowns. You know, the financials haven't really borne
Speaker 1: any of the impact, right, you know, that's something that
Speaker 1: they will be watching closely going forward. Matt Turner, stocks
Speaker 1: reporter at Bloomberg News. He joins us live on the
Speaker 1: phone from Wee Hawk in New Jersey, giving us the
Speaker 1: latest on d D Inc, The parent company of d
Speaker 1: D Sho Shang. Thanks so much, Matt for joining us.
Speaker 1: You're listening to Bloomberg Business Week with Carol Masser and
Speaker 1: Bloomberg Quick Takes Tim Stinovic on Bloomberg Radio. Well, here
Speaker 1: at Bloomberg Business Week, we've been covering the unequal distribution
Speaker 1: of vaccines around the world. What's happening here in the
Speaker 1: United States is certainly the exception, not the rule, with
Speaker 1: vaccines pretty much available for free to anyone who's eligible.
Speaker 1: But a new story in Bloomberg Business Week by James
Speaker 1: Peyton and John Lawerman talks about life saving vaccines becoming
Speaker 1: profit machines for drugmakers and for middle income countries protection
Speaker 1: from the virus can cost governments dearly. Joining me now
Speaker 1: is Joel Webber, editor at Bloomberg Business Week. He's with
Speaker 1: me in the Bloomberg Interactive Brokers studio. Also joining us
Speaker 1: is James Peyton, healthcare reporter for Bloomberg News. He joins
Speaker 1: us on the phone from London. Joel, this is a
Speaker 1: fantastic piece that that really dives into the cost, really
Speaker 1: what it costs countries around the world, uh, to actually
Speaker 1: get this life saving tonic, right, this life saving vaccine.
Speaker 1: And I'm wondering how much should they be getting charged
Speaker 1: by these for profit pharmaceutical companies that for decades have
Speaker 1: been boogeyman. That's what we're finding out right. And I
Speaker 1: think what what sticks out to you, um or to
Speaker 1: me at least in this story is is actually just
Speaker 1: what a big windfall COVID vaccines have become for pharma.
Speaker 1: I mean, we're looking at a hundred billion plus dollar
Speaker 1: business and depending on how things go, you could just
Speaker 1: imagine their booster shots look like another another wave of
Speaker 1: money for them. But there is this have and have
Speaker 1: not question that I think we we as a as
Speaker 1: a newsroom, have spent a lot of time thinking about
Speaker 1: and talking about and reporting about, and I think this
Speaker 1: story is another version of that. Because there are the
Speaker 1: the America's and granted there are a few countries quite
Speaker 1: like ours that can pull off pull off what we
Speaker 1: can pull off, and that leaves the rest of the
Speaker 1: world in a different predicament. And especially for the load
Speaker 1: of middle income countries, the options do not look great um.
Speaker 1: And these vaccines are not always cheap um. And so
Speaker 1: that brings in a question of soft power. Well, so, James,
Speaker 1: let's bring you in here. What what stands out to you?
Speaker 1: Um as you were writing about the story. Yeah, we'll
Speaker 1: get to be with you. I mean, I think you
Speaker 1: you nailed it, you know, in terms of the debate,
Speaker 1: because um, I think it's an important one to have.
Speaker 1: You know, these huge sales that you mentioned that are
Speaker 1: flowing to the vaccine makers raise that question right of
Speaker 1: what is a fair price and what is a fair
Speaker 1: profit UM in the middle of a raging pandemic. You know,
Speaker 1: and as you say, these vaccines are saving wives, they're
Speaker 1: rescuing businesses, allowing countries like the US and the UK
Speaker 1: where where I am, to reopen. Obviously that is mentally
Speaker 1: valuable to those countries that are UM fortunate enough to
Speaker 1: have vaccines, but you know, vast parts of the world
Speaker 1: have this limited UM access and some of the people
Speaker 1: I talked to for this story question, you know, what
Speaker 1: level of profits are are justified given that uneven dis
Speaker 1: abution we're seeing and given them many of these vaccines
Speaker 1: are heavily funded by governments, by the US, by the UK, Germany,
Speaker 1: and some nonprofits that themselves received funding from governments, and
Speaker 1: there is an interest beyond the humanitarian one is you know,
Speaker 1: as we've written a lot about and discussed UM, you know,
Speaker 1: there's a lot of steak from a from a health perspective,
Speaker 1: in an economic sense as well. If this virus keeps circulating,
Speaker 1: new variants could emerge that could be you know, problematic,
Speaker 1: and that could prolong the pandemic. So you know, this
Speaker 1: is an important issue and it's not just a question
Speaker 1: of the availability of vaccines to win these countries will
Speaker 1: get access to these shots, but also whether they'll be
Speaker 1: affordable uh when when they when they finally do get
Speaker 1: the chance to uh to purchase them. So I think
Speaker 1: it's a I think it's an important topic. Well, it's
Speaker 1: it's something that we're seeing play out right before our
Speaker 1: eyes with the delta variant, if we were able to
Speaker 1: you know, this is the variant that is is more
Speaker 1: concerning than other variants that were predominant here in the
Speaker 1: United States just a few months ago, and it's certainly
Speaker 1: ripping its way around the UK and indeed the predominant
Speaker 1: variant of new infections here in the United States, and
Speaker 1: it's certainly concerning. Um. I wonder about some of the
Speaker 1: examples that you write about. Take us into what you
Speaker 1: learned about Senegal for example. Yeah, Well, we looked at
Speaker 1: we looked at some countries around the world and um,
Speaker 1: you know, the thing on pricing is that there's a
Speaker 1: lack of transparency and there's very little disclosure about who
Speaker 1: is paying what. So some of the prices are starting
Speaker 1: to emerge. You know, We've looked at some regulatory filings Uh,
Speaker 1: you know, government statements and some of the sources that
Speaker 1: we've talked to, and you know, you can start to
Speaker 1: paint the picture. But you mentioned Senegal. You know it's
Speaker 1: a lower income UH country. They are paying uh, they
Speaker 1: agreed to pay about roughly twenty U S dollars a
Speaker 1: dose for Sign of Farms vaccine. Now, this is one
Speaker 1: of the Chinese vaccine makers that we talked about in
Speaker 1: our piece as well. And now you know, you can
Speaker 1: look at some of these prices and say, you know what,
Speaker 1: that doesn't sound like a lot given you know, the
Speaker 1: potential of vaccines, given what we're talking about, and also
Speaker 1: some of these costs, to be fair, you know, they
Speaker 1: pale in comparison to the the economic costs of of
Speaker 1: not vaccinating your population, right, I mean you consider the
Speaker 1: trillions of dollars globally that that's at stake. But for
Speaker 1: a country like Senegal, um, you know, I mean we
Speaker 1: look at some data showing that they're um annual per
Speaker 1: capita health spending is less than sixty U S dollars
Speaker 1: And for a lot of these for a lot of
Speaker 1: these countries, you know, they're they're grappling with multiple health threats. Uh.
Speaker 1: You know around the world. They're obviously diseases like malaria
Speaker 1: and HIV and many others, and these are you know,
Speaker 1: stretched health. But just that these countries are working with
Speaker 1: and you know, they're not in a position obviously to
Speaker 1: spend big vaccines. They might be able to do it,
Speaker 1: they might be able to pull it off, but then
Speaker 1: that raises the risk that they'll have to divert spending
Speaker 1: from other areas to to pay the bill for vaccines,
Speaker 1: and that could have a long term impact that will
Speaker 1: be writing about probably for years to come. And that
Speaker 1: Actually there's this great quote that I loved in here,
Speaker 1: which is this is essentially a seller's market. And that's
Speaker 1: a quote that refers not only to uh, what the
Speaker 1: US companies can charge, but also even the Chinese ones.
Speaker 1: What's I found surprising that in some cases the Chinese
Speaker 1: vaccines cost even more than the American ones, just bite
Speaker 1: maybe not having the same efficacy. Absolutely, And the China
Speaker 1: side to this, I think is is fascinating because there
Speaker 1: has been a focus you know, we have done some
Speaker 1: stories on this, but looking at the geopolitical benefits to
Speaker 1: China gets from exporting vaccines to the world, but overlooked
Speaker 1: perhaps is the financial benefit to China. You know, China,
Speaker 1: you may recall last year talked about vaccines being a
Speaker 1: global public good. You know, they wanted to treat vaccines
Speaker 1: as the global public good. And you know, we're finding
Speaker 1: now China, Chinese companies are finding now that they're also
Speaker 1: you know, turning out to be lucrative products for Chinese
Speaker 1: companies as well. And now, you know, one person I
Speaker 1: talked to with the counsel on Foreign Relations pointed out
Speaker 1: that China likely sees that as something that's actually beneficial.
Speaker 1: You know, they can benefit the world can benefit from
Speaker 1: uh their vaccines. But some of these vaccines are not
Speaker 1: cheap that the Chinese companies are selling well. It's a
Speaker 1: fantastic story by James Payton along with John Lawerman. You
Speaker 1: can read James a story on the Bloomberg and at
Speaker 1: Bloomberg dot com, Slash business Week. James Payton his healthcare
Speaker 1: reporter at Bloomberg News. Joe Webber, editor of Bloomberg Business Week,
Speaker 1: Joel's with me in the Bloomberg Interactive Broker Studio. This
Speaker 1: is Bloomberg Business Week with Carol Masser and Bloomberg Quick Takes.
Speaker 1: Tim Stinovic on Bloomberg Radio. Hello. Hello, it's Bloomberg Business Week.
Speaker 1: Tim Stinaback live in the Interactive at Broker's Studio in
Speaker 1: New York. Carol Masser taking a well deserved day off today. Well,
Speaker 1: Andy Jasse, it's day two for the brand new CEO
Speaker 1: of Amazon. Shares of Amazon are hired today by four
Speaker 1: point seven and nine percent as we speak, reaching a
Speaker 1: new intra day record. But he's got his work cut
Speaker 1: out for him long term. Jasse has to navigate Washington
Speaker 1: and European regulators, and of course appears a growing workforce
Speaker 1: of hundreds of thousands of warehouse employees. Heather are Younger
Speaker 1: as founder and CEO of employee Fanatics. It's an employee
Speaker 1: experienced consulting firm. She joins us now from Denver, Colorado. Heather,
Speaker 1: it's great to have you. How are you. I'm doing great,
Speaker 1: Thanks for having me on. So what is the advice
Speaker 1: that you would give Amazon's brand new CEO, Andy Jassy?
Speaker 1: Who mind you? Has been somebody who's been at Amazon
Speaker 1: for decades. He's most recently had of a WS in
Speaker 1: his first week of of being CEO. Well, I think
Speaker 1: no matter what, he needs to be really clear up
Speaker 1: what type of leader he's going to be, uh, and
Speaker 1: how he might be different from Paseos of course, and
Speaker 1: even though he's been there, you know, setting his mark,
Speaker 1: deciding what kind of leader he wants to be and
Speaker 1: how he's going to show up for all of those
Speaker 1: hundreds of thousands of people who are looking to him
Speaker 1: for leadership. That's that's one thing I think. Secondly, Um,
Speaker 1: he's going to need to take some real clear steps
Speaker 1: to listen to those people, because I'm not sure anybody
Speaker 1: has been listening and understanding what their needs are, what
Speaker 1: their complaints might be, and just to be committed to
Speaker 1: doing the right thing as it relates to them. It's
Speaker 1: so interesting that you said that that element of listening,
Speaker 1: because when I was reading the notes that our producer
Speaker 1: Paul sent to me, Um, you mentioned listening and it
Speaker 1: struck me because, as as I mentioned earlier in the show,
Speaker 1: I just finished We're Colleague brad Stone's new book about Amazon,
Speaker 1: and I was struck with many parts of it. But
Speaker 1: he shares this story from a little over a year
Speaker 1: ago April, when the United States, in the midst of
Speaker 1: this pandemic, Amazon is hiring so many new people. These
Speaker 1: are essential workers, the service quickly becoming essential to people
Speaker 1: who are in lockdown and need to get groceries and supplies.
Speaker 1: And Jeff Bezos made a surprise visit to one of
Speaker 1: Amazon's warehouses, but it was the first time that he
Speaker 1: had visited one of those fulfillment centers in years. Yeah,
Speaker 1: and I think that's a really big mistake. I'm hoping
Speaker 1: that Jesse says, you know what, I'm going to be
Speaker 1: the listening leader. I'm going to be going around and
Speaker 1: I'm gonna do a listening tour, go to as many
Speaker 1: as Sinners as I can, even if it's virtual or
Speaker 1: in person, but in person probably better, so we can
Speaker 1: really see how people are living in the in the
Speaker 1: way in which they have to work every day and
Speaker 1: trying to trying to get their work done. So yeah,
Speaker 1: I hope that would be his first step as listening tours,
Speaker 1: just going around, Um, you know, the listening is it's
Speaker 1: no It'll go a huge way for those people because
Speaker 1: they hadn't been listening to They people know when they've
Speaker 1: been heard, they know when they're cared for by the
Speaker 1: leaders who they look to for guidance, and that would
Speaker 1: build a level of trust that he needs right off
Speaker 1: the bat, particularly any new initiatives he's trying to get,
Speaker 1: you know, put through. How does he do this at
Speaker 1: scale though, because this is something that Amazon is a
Speaker 1: unique piast, right, it has fulfillment centers all over the world.
Speaker 1: Is that hundreds of thousands of employees. How does Jesse
Speaker 1: do this in a way that makes it look like
Speaker 1: he's going on He's going beyond just doing it for show. Yeah,
Speaker 1: I mean in the end, he doesn't have to do
Speaker 1: it all by himself. He can have the whole feast me.
Speaker 1: He can have outside consulting firms like my employee Fanatics
Speaker 1: right come in and help with some of the listening sessions.
Speaker 1: In the end, it's when they know that they are
Speaker 1: being heard and that there's an intent to act on
Speaker 1: at least some of what it is they're saying, and
Speaker 1: they see the results, and then you feed them back
Speaker 1: do action, telling them what it is you're doing for them.
Speaker 1: They know they've been heard. It makes it just makes
Speaker 1: a huge difference. It validates it. It It makes them feel
Speaker 1: that the world that they're doing is meaningful and they
Speaker 1: feel like there's more than just the day to day,
Speaker 1: but that there's it's leading to some bigger mission for
Speaker 1: the world. Okay, so apart from the listening tour, what
Speaker 1: else can Joss you do, especially when it comes to
Speaker 1: working with other executives to help build up that team. Yeah,
Speaker 1: I mean, I think you know, right off the bat,
Speaker 1: if he's able to establish with his leadership team that
Speaker 1: that things are going to change, that it is going
Speaker 1: to be about making sure that they're driving a more
Speaker 1: positive culture, and that every one of those people on
Speaker 1: the leisure team has to take responsibility so he's not
Speaker 1: in it all by himself. That will be super clear.
Speaker 1: Making sure that maybe he does put someone in charge
Speaker 1: that really is super focused on having the pulse for employees,
Speaker 1: suggesting really good avenues for cultural improvements um and making
Speaker 1: sure that they're always keeping those at the front line
Speaker 1: of the customer experience right at the front of all
Speaker 1: their cultural improvement so that they're you know, it's not
Speaker 1: so just coming from top down, but maybe he creates
Speaker 1: culture teams all throughout the organization and they report into
Speaker 1: this new person, but making sure that there's someone that
Speaker 1: has the pull. I think the other thing through all
Speaker 1: of this kind of cree time is making sure that
Speaker 1: that he and his team, and the the team members
Speaker 1: can be adaptable, less fearful, and they'll be less fearful,
Speaker 1: more adaptable when they're aware of changes that are coming
Speaker 1: down the pipes and being super open and communicative about this.
Speaker 1: You know, it's interesting that this is all happening at
Speaker 1: the tail end at least in the United States of
Speaker 1: the pandemic. And it was announced at the beginning of
Speaker 1: the year back in January, that Jeff Bezos would be
Speaker 1: doing this, but it's still the pandemic. And one thing
Speaker 1: that we're seeing happen around the US is employees uh
Speaker 1: leave firms for new jobs and in some cases, uh
Speaker 1: not even going into the office to be able to
Speaker 1: say goodbye to employee until their colleagues who they've known
Speaker 1: for years. Because of just where we are right now.
Speaker 1: What are the takeaways that we can learn from a
Speaker 1: transition like Bezos and Jassy's that that we can all
Speaker 1: apply to our own corporate lives. Mm hmm. I think
Speaker 1: is this idea of reinvention is a big one for reinventing.
Speaker 1: You know yourself as a leader, and then how do
Speaker 1: you and then if your over the organization as a
Speaker 1: beastly as Almazon, how do you kind of reinvent, but
Speaker 1: don't do it in the stylo and don't just do
Speaker 1: it at the leadership level. How do you? How are
Speaker 1: you more inclusive in your decision making? Um? I think
Speaker 1: that's gonna be the biggest thing for leaders coming forward.
Speaker 1: And and I'm not just talking from you know, the
Speaker 1: marginalized group side, I'm just talking about generally, how are
Speaker 1: we more inclusive in the decision making process that people
Speaker 1: feel bought into things? And when we're talking about these
Speaker 1: people that are not coming back, it's probably because leaders
Speaker 1: aren't getting a clue. They don't understand what it is.
Speaker 1: They're people needed from the beginning. They needed to be
Speaker 1: listening and they needed to be more inclusive. Thirty seconds Heather,
Speaker 1: we uh, you know, we know on Wall Street leaders
Speaker 1: of publicly traded companies are judged by returns. How are
Speaker 1: you going to judge Jesse? You know, I hate to
Speaker 1: say it, but those those news articles, the things that
Speaker 1: you see, the coverage that's happening with employees and sour
Speaker 1: paces leaving their mouth. I think I'm gonna judge him
Speaker 1: by how how that goes down and if it's gonna
Speaker 1: be if he's gonna be able to turn the tide
Speaker 1: of the negative culture and bad press that they're getting.
Speaker 1: What is he going to do us to his mark
Speaker 1: to create a more positive culture. Yeah, it's a really
Speaker 1: good metric to use. Heather are Younger is founder and
Speaker 1: its CEO of Employee Fanatics. It's a firm that works
Speaker 1: with companies to help employee experience. Heather joining us from Denver, Colorado. Heather,
Speaker 1: thanks so much for your time. I'm roc a journal Yeah,
Speaker 1: but you let me drive? Oh no, no, no no, no, honey, please,
Speaker 1: I'll do the riding revel with me. I want to
Speaker 1: drive all just drive, baby, the questions trying. This is
Speaker 1: the drive to the close community. Thanks, we'll driving us
Speaker 1: down on Bloomberg Radio. Yes, indeed it is that time,
Speaker 1: the drive to the clothes. We're just over ten minutes
Speaker 1: away from the is the market on this Tuesday, June
Speaker 1: Lie six. But I used to saying July. We are
Speaker 1: more than halfway done with the year, after all. Joining
Speaker 1: us now is Randy Watt's chief investment strategist at O'Neill
Speaker 1: Global Advisors, joining us on the phone from Miami. Randy,
Speaker 1: how are you this afternoon? Tim? I'm I'm well, I
Speaker 1: hope you and your family are well, and it's good
Speaker 1: to hear your boys. Yeah, it's good to hear yours
Speaker 1: as well. Thanks so much for taking the time. We're
Speaker 1: doing well. Thanks Randy. Take us into how how you're
Speaker 1: thinking about the market. I mean, look at what we're
Speaker 1: poised to do today, the sp five looking like it's
Speaker 1: going to snap a seven day winning streak, the Dow
Speaker 1: down today for the first time in five sessions. How
Speaker 1: are you reading into it? Well, I think technically there's
Speaker 1: a slight lag right now if the S and P
Speaker 1: versus the Nasdaq that's really being driven by a rotation
Speaker 1: into large cap growth stocks. The market, though, overall, is
Speaker 1: trending within a channel that has really dated back to November,
Speaker 1: with the upper end rising to about and the lower
Speaker 1: end of the fifty d m A which is about eleven.
Speaker 1: Well right now, the leadership is in tech, retail, and healthcare.
Speaker 1: Some of the more cyclical value groups like transports, materials,
Speaker 1: financials have been basically consolidating their gains from earlier in
Speaker 1: the year and probably need a little bit of time
Speaker 1: to go go sideways before they make another thrust up.
Speaker 1: How much higher does this bullmarket go. I think it
Speaker 1: depends on two things. It depends on earnings and it
Speaker 1: depends on yields. As you mentioned a minute ago, you know,
Speaker 1: the ten year back to one five because an awful
Speaker 1: lot of valuation support for stocks. I think the thing
Speaker 1: investors are wrestling with right now is coming out of
Speaker 1: that that first quarter earning season, earnings estimates went up
Speaker 1: quite a bit for the S and P. People are
Speaker 1: looking for a D eight dollars and earnings this year
Speaker 1: and two eleven for next year. If those earnings come through,
Speaker 1: I do think there's upside on the market because the
Speaker 1: market would be about twenty times next year's earnings. But
Speaker 1: I think what investors are wrestling with is two things.
Speaker 1: First is is there going to be a margin squeeze
Speaker 1: in the second quarter. So we've seen a lot of
Speaker 1: costs go up, whether that's raw materials excuse me, raw
Speaker 1: materials or average hourly earnings which are obviously labor costs
Speaker 1: are going up here. And then I think the second
Speaker 1: thing they're wrestling with is because there are so many
Speaker 1: supply shortages, both in materials and also in labor, are
Speaker 1: coming to am Able to meet their production schedules for
Speaker 1: the for the second quarter and for the third quarter,
Speaker 1: and so I think that's why you've seen a little
Speaker 1: bit of a move back to growth here, is that
Speaker 1: people aren't sure whether they should trust those earnings estimates. Well,
Speaker 1: where are you on the transitory versus not transitory debate?
Speaker 1: Because when you when you talk about the margin squeeze here,
Speaker 1: what you're talking about is higher input costs and to
Speaker 1: what extent those margins are going to be hurt by
Speaker 1: those and by a difficult time getting supplies and inputs.
Speaker 1: Um is this something that's here to stay or is
Speaker 1: this something that is indeed the word in the words
Speaker 1: of the FED transitory. I think it's less transitory than
Speaker 1: people people are. Why why do you think that? I
Speaker 1: think for two reasons. First is that because people are
Speaker 1: having to offer workers high wages and many jobs than
Speaker 1: they did before the pandemic. And once labor gets back up,
Speaker 1: it's not like they're gonna lower those wages. Right, So,
Speaker 1: if you had someone in the kitchen in a small restaurant,
Speaker 1: you're paying eighteen dollars an hour, and now you're paying
Speaker 1: him twenty, you're not going to cut it back to eighteen.
Speaker 1: Once there's a little bit more labor force, you're gonna
Speaker 1: keep paying him twenty and and the second is other
Speaker 1: elements like rent. Though it's been down in New York City,
Speaker 1: it's up in a lot of places around the country,
Speaker 1: residential rents. I don't think those are reverting down, you know,
Speaker 1: anytime soon. So I think there's some things that are
Speaker 1: going to be stickier than people suspect. So I do
Speaker 1: think inflation is going to run higher. To refresh for
Speaker 1: your for your listeners, inflation was five percent for twelve
Speaker 1: months at the end of May, So inflation is running high.
Speaker 1: It's been a problem. I think the FED and many
Speaker 1: central banks around the world are willing to let these
Speaker 1: economies run hot because they're worried about, uh, the slow
Speaker 1: down that we're coming out of. But I do think
Speaker 1: it's an issue. Yeah, And look, you're you're kind of
Speaker 1: reading my mind here because of the stories that I
Speaker 1: want to talk about in a few minutes is by
Speaker 1: our own Alex Tanzi talking about how storing us rents
Speaker 1: are the sticky part of inflation with staying power and
Speaker 1: according to Apartment List, the median national rent climb nine
Speaker 1: point two in the first half of UM that's according
Speaker 1: to apartment list. So so that raises the question. You
Speaker 1: talk about rising rents, you talk about rising wages. What
Speaker 1: are the other metrics that you're looking at to tell
Speaker 1: you whether inflation is sticky. Well, obviously commodities are up
Speaker 1: a great deal when you look at the commodity index,
Speaker 1: you know, oils up year to date, aluminums up twenty nine,
Speaker 1: coppers up twenty two, and a lot of these. Because
Speaker 1: the supply shortages are not going to instantly go back down,
Speaker 1: but they may go back down over time, but it's
Speaker 1: not like it's going to happen in the next month
Speaker 1: or two. So I think that's going to force companies
Speaker 1: to pay some issue with either they have to let
Speaker 1: their margins get squeezed or they're gonna have to raise price.
Speaker 1: And if they raise price, what is that going to
Speaker 1: do for demand? I do. I don't want to sound
Speaker 1: to bearish. The economy is recovering, we are growing. It's
Speaker 1: just like the market's got a lot of good news
Speaker 1: in it and we need those earnings as stims to
Speaker 1: come through for the market to continue be able to
Speaker 1: move higher. Rights So so you're saying the market's gotten
Speaker 1: a little ahead of itself. I think the market is
Speaker 1: a little ahead of its self right now, but it's
Speaker 1: been supported by those low yields. Now, if the tenure
Speaker 1: was higher, we'd be having a different conversation because there
Speaker 1: would be pressure. But I think the move back to
Speaker 1: growth stocks recently tells you that some investors are nervous
Speaker 1: about whether that out your number of two eleven is
Speaker 1: the right number. Yeah, look, I guess also the question
Speaker 1: is is really about how to be defensive and not
Speaker 1: necessarily that you need to be defensive, And that's not
Speaker 1: what I'm saying, what you're suggesting, but it does sound
Speaker 1: like that you know, you could be in for a
Speaker 1: quite the ride, and how would you position your portfolio
Speaker 1: right now? I mean, we do like some of the
Speaker 1: big cap growth stocks still. We do like healthcare. Healthcare
Speaker 1: in particular. We think it's going to have a better
Speaker 1: second half of the year as the utilization rate of
Speaker 1: health care services gets back to normal. Obviously, there are
Speaker 1: a lot of healthcare areas that suffered during the pandemic
Speaker 1: as people didn't want to go to the doctor. They
Speaker 1: didn't want to see their oncologists, they didn't want to
Speaker 1: see their they're cardiologists. So I think that's gonna that's
Speaker 1: gonna pick back up. We still like a lot of
Speaker 1: areas consumer discretionary. People have been pent up. There's an
Speaker 1: awful lot of consumer savings whity to get spent. People
Speaker 1: didn't buy a lot of clothes and shoes, etcetera. For
Speaker 1: a year. Now people are going back out. We like
Speaker 1: the travel space, hotels, airlines, etcetera. So I do think
Speaker 1: there's still a positive story with regards to this recovery.
Speaker 1: But I do think maybe some of the raw materials, transports,
Speaker 1: financials a little bit ahead of themselves, so I would
Speaker 1: shy away from those in the short term. Let's talk
Speaker 1: a little bit about some of the stocks that you
Speaker 1: are bullish on. Intuitive Surgical, the maker of the Da
Speaker 1: Vinci surgical device. Why are you so bullish on this?
Speaker 1: I think there's a real secular theme going there. There
Speaker 1: there's two things. There's a cyclical in the secular. The
Speaker 1: secular is that a lot more. They're a leader in
Speaker 1: laper scopy, so operations that are done very minimally invasive.
Speaker 1: They're the clear leader there. More and more operations are
Speaker 1: being done that way. There's a great expansion and that's
Speaker 1: going to continue. Second, people put off elective surgeries over
Speaker 1: the last year because of COVID, no one wanted to
Speaker 1: go to the hospital. And I think now you're going
Speaker 1: to see things like hip replacements, new replacements, etcetera start
Speaker 1: to pick up, and that's going to really provide a
Speaker 1: nice tail win too. What's already a good secular story
Speaker 1: for an industry leader. Okay, what about Nike. You know,
Speaker 1: Nike had had had a great number of last quarter.
Speaker 1: We're seeing we're seeing a pickup in demand. I think
Speaker 1: people are spending more money on both apparel and on footwear.
Speaker 1: They continue to do well overseas. They've done a great
Speaker 1: job with expanding in Asia. They've also done a great
Speaker 1: job with their digital marketing and e commerce, which is
Speaker 1: going to continue. So I think like Intuitive Surgical, they
Speaker 1: benefit from both the cyclical pickup what's going on right now,
Speaker 1: as well as with Nike as secular pickup as they
Speaker 1: expand into apparel more, they expand in Asia and they
Speaker 1: get more of their orders coming in digitally online. Randy,
Speaker 1: we are going to have to leave it there. It
Speaker 1: is always great to shot with you. Thank you so
Speaker 1: much for taking the time and joining us on a
Speaker 1: Bloomberg Business Week Radio. That's Randy Watts, chief investment strategist
Speaker 1: at O'Neill Global Advisors, joining us on the phone from Miami.
Speaker 1: Thanks for listening to Bloomberg Business Week. Download the podcast
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