WEBVTT - Investing Beyond Earth 0:00:00.800 --> 0:00:04.040 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside 0:00:04.040 --> 0:00:06.920 my co host Matt Miller. Every business day we bring 0:00:06.960 --> 0:00:11.520 you interviews from CEOs, market pros, and Bloomberg experts, along 0:00:11.560 --> 0:00:15.600 with essential market moving news. Find the Bloomberg Markets Podcast 0:00:15.600 --> 0:00:18.479 on Apple Podcasts or wherever you listen to podcasts, and 0:00:18.480 --> 0:00:22.319 at Bloomberg dot com slash podcast. All right, let's say 0:00:22.320 --> 0:00:27.040 you want Matt to invest in space as in the Cosmos, 0:00:27.480 --> 0:00:29.720 there is an e t F for that to procure 0:00:30.000 --> 0:00:33.839 space et F ticker symbol you guessed it, u f O. 0:00:34.040 --> 0:00:37.680 Andrew Shannon, chief executive Officer procure a M joins us 0:00:37.680 --> 0:00:40.519 this morning. Andrew a lot of interest growing in the 0:00:40.640 --> 0:00:45.680 commercialization of space working at the spaces x launched last Friday. 0:00:45.840 --> 0:00:49.839 Talk to us about your space et F. What's in 0:00:49.960 --> 0:00:53.239 your space et F? Thanks so much for having me. 0:00:53.360 --> 0:00:57.280 So we launched UFO back in April of and we've 0:00:57.320 --> 0:01:01.120 seen the space industry go through some dramatic changes. That's 0:01:01.120 --> 0:01:04.600 really opening up for the commercialization of the space industry. 0:01:04.959 --> 0:01:08.160 And so someone looking to invest in UFO will notice 0:01:08.200 --> 0:01:11.000 that the underlying index that are fund tracks um actually 0:01:11.040 --> 0:01:14.840 focuses with at least eighty percent of the weight of 0:01:14.920 --> 0:01:18.280 the fund is actually in companies deriving a majority of 0:01:18.360 --> 0:01:22.200 their revenues from space, while up to of the underlying 0:01:22.200 --> 0:01:25.920 index can focus on some more diversified companies that are 0:01:26.080 --> 0:01:29.839 major players in the space industry. Think you're diversified aerospace 0:01:29.880 --> 0:01:33.479 and defense names your Lockeeds and Bowings, um. But because 0:01:33.560 --> 0:01:37.240 it's not the largest driver of their revenues, that entire 0:01:37.280 --> 0:01:40.280 tranche is capped at. So you're really looking at companies 0:01:40.319 --> 0:01:43.959 that are driving significant revenues from space. So satellite companies, 0:01:44.240 --> 0:01:48.280 launch providers, companies that are relying upon space based systems 0:01:48.280 --> 0:01:52.960 and services, so communications is a major driver UM, as 0:01:53.000 --> 0:01:58.680 well as satellite operators and manufacturers as well. So I see, um, 0:01:58.840 --> 0:02:03.120 your top ten holdings in include Dish Network, which makes 0:02:03.160 --> 0:02:08.840 sense because the satellites garment. I guess also um uh 0:02:09.120 --> 0:02:11.480 Serious x M, which a lot of people are listening 0:02:11.520 --> 0:02:15.520 to us on Serious x M. What about the explorers 0:02:15.520 --> 0:02:20.040 like Virgin Galactic for example, or I know Blue Origin 0:02:20.360 --> 0:02:25.520 and Space x aren't publicly accessible, but do you see 0:02:25.520 --> 0:02:27.760 a future in which we can be owning you know, 0:02:27.840 --> 0:02:32.480 companies that make rockets and take people to outer space. Well, 0:02:32.480 --> 0:02:35.480 so you're already getting exposure to those companies in the funds, 0:02:35.560 --> 0:02:38.480 so many people aren't familiar. But Boeing and Lockey to 0:02:38.520 --> 0:02:41.720 actually have a joint venture called the United Launch Alliance, 0:02:41.760 --> 0:02:46.240 which helps you send send things to outer space. Virgin Galactic, 0:02:46.320 --> 0:02:49.520 like you mentioned, is a holding specializing in space tourism. 0:02:49.919 --> 0:02:52.480 Um that they're still working on their product and experience 0:02:52.520 --> 0:02:54.680 to be able to safety bring people to outer space. 0:02:54.919 --> 0:02:57.240 But some of those kind of topics that you're already 0:02:57.240 --> 0:03:00.360 mentioning are things that are already in the fund. And 0:03:00.400 --> 0:03:03.680 so although SpaceX being a private company, isn't in the fund, 0:03:04.000 --> 0:03:06.799 their ability to help lower the cost of sending things 0:03:06.800 --> 0:03:10.079 to outer space is actually benefiting many companies in the portfolio. 0:03:10.160 --> 0:03:12.519 So I think the company like max Are, which helps 0:03:12.680 --> 0:03:16.120 build satellites well to the extent that someone can now 0:03:16.200 --> 0:03:18.880 purchase the satellite from max Bar and send it to 0:03:18.880 --> 0:03:21.400 outer space for significantly less than they could maybe even 0:03:21.440 --> 0:03:24.800 just five years ago, is now opening up for significantly 0:03:24.840 --> 0:03:27.959 more clients for the space industry. So they're already having 0:03:28.080 --> 0:03:29.919 knock on effects. And then you look at this launch 0:03:29.960 --> 0:03:31.600 that you know they helped NASA send people to the 0:03:31.600 --> 0:03:35.320 I s S. Just this past week, and you're it's 0:03:35.320 --> 0:03:38.120 almost like a Bogo special that SpaceX is offering for 0:03:38.200 --> 0:03:40.880 its clients. For NASSAIS to spend over eighty million dollars 0:03:40.880 --> 0:03:42.840 a seat to send an astronauts to the I s S. 0:03:43.080 --> 0:03:46.440 It's now coming in in the mid forty million dollar range, 0:03:46.600 --> 0:03:48.960 So that frees up more budget for space agencies like 0:03:49.040 --> 0:03:52.840 the E s A, NASA and beyond. So, Andrew, do 0:03:52.880 --> 0:03:56.840 you believe there will be more space oriented companies coming 0:03:56.880 --> 0:03:59.360 to the public markets, will be more opportunities for investors 0:03:59.360 --> 0:04:02.840 to to in eston what appears to be a growing 0:04:02.840 --> 0:04:06.560 commercialization of space. We certainly hope so. And you're already 0:04:06.560 --> 0:04:08.960 seeing in the stack market. There's been eight or so 0:04:09.080 --> 0:04:13.000 companies that have been named as the targets for potential 0:04:13.040 --> 0:04:16.760 SPACK mergers. Are Fund doesn't invest in a company that 0:04:16.920 --> 0:04:20.080 is a STACK until actually SPACs UM and and the 0:04:20.120 --> 0:04:23.360 merger has fully gone through. So there is opportunity for 0:04:23.400 --> 0:04:26.800 more companies as they go public, weather NEA, AD, SPACK 0:04:26.920 --> 0:04:29.640 and I p O or even spinoffs UM that could 0:04:29.680 --> 0:04:31.680 find their way into UFO. But right now there's over 0:04:31.760 --> 0:04:34.640 thirty companies from around the world UM, you know with 0:04:34.720 --> 0:04:36.520 a with a space focus that you could currently get 0:04:36.520 --> 0:04:38.880 exposure to in the fund, but we're not capped at 0:04:38.880 --> 0:04:40.599 the amount of companies that can be added, So we 0:04:40.680 --> 0:04:43.800 certainly will welcome more companies with a pure place space 0:04:43.839 --> 0:04:47.880 focus in the future. How big is this industry and 0:04:48.120 --> 0:04:52.760 what kind of growth should we expect? Yes, so the 0:04:53.160 --> 0:04:55.720 Space Foundation puts up the Space Report annually, and I 0:04:55.760 --> 0:04:58.400 believe in rough in July we should get the numbers 0:04:58.400 --> 0:05:02.440 for twenty In twenty nineteen it was roughly a four 0:05:02.240 --> 0:05:05.200 four billion dollar industry. And you look at different research 0:05:05.279 --> 0:05:09.240 houses and banks. Morgan Stanley is predicting by you know, 0:05:09.279 --> 0:05:12.000 over a trillion dollars by twenty forty. Bank of America 0:05:12.080 --> 0:05:14.680 actually for nix Um that the industry will be about 0:05:14.720 --> 0:05:20.400 two point seven trillion dollars right now. Roughly one third 0:05:20.520 --> 0:05:23.720 of the commercial market is actually communications companies. And if 0:05:23.760 --> 0:05:26.080 you look at what these different banks are saying is 0:05:26.080 --> 0:05:29.560 going to be the main driver for the space industry 0:05:29.680 --> 0:05:32.680 in the next twenty years or so, UM, they point 0:05:32.680 --> 0:05:35.760 to broadband internet and communications, and that's something that our 0:05:35.800 --> 0:05:39.279 our fund already has a pretty significant exposure to. So, 0:05:39.400 --> 0:05:42.240 you know, you can't really play the space industry without UM. 0:05:42.279 --> 0:05:45.680 You know, incorporating communications and broadband internet and some of 0:05:45.720 --> 0:05:47.839 these other companies that are going to be driving that, 0:05:48.520 --> 0:05:51.480 um your potential growth. So you know, right now that's 0:05:51.560 --> 0:05:54.200 kind of the composition of the funds, but certainly as 0:05:54.320 --> 0:05:58.480 more areas like even resource extraction and infrastructure build out 0:05:58.600 --> 0:06:01.919 and outer space UM, even the militarization and defense of space, 0:06:01.920 --> 0:06:03.920 which is something that hasn't gone that ton of attention, 0:06:04.200 --> 0:06:06.680 but it's clearly picking up all these are areas that 0:06:06.760 --> 0:06:11.480 people could potentially get exposure to currently and in the future. Andrew, 0:06:11.520 --> 0:06:15.200 is there any sense that space X will go public 0:06:15.240 --> 0:06:18.719 at any time in the future. Well, certainly Elon Musk's 0:06:18.839 --> 0:06:22.640 uh the likes to tease, uh, you know that bad idea. UM. 0:06:22.720 --> 0:06:25.640 He's mentioned that potentially he would spin off Starlink, which 0:06:25.680 --> 0:06:30.560 is our satellite network UM business before going public with SpaceX, 0:06:30.560 --> 0:06:32.880 and he even said that he wouldn't go public with 0:06:32.920 --> 0:06:36.279 SpaceX until um. You know, we have people on mars 0:06:36.680 --> 0:06:39.440 UM here who knows, you know, if those timelines are 0:06:39.480 --> 0:06:42.360 are accurate. But certainly there are some really ambitious hopes. 0:06:42.400 --> 0:06:44.440 But there's also plenty of the man for investing in 0:06:44.480 --> 0:06:47.159 space X through the private markets, and we've seen through 0:06:47.200 --> 0:06:50.240 stock and through debt. Um Your Canadian pensions have had 0:06:50.440 --> 0:06:53.200 a very huge interest in investing in space, even beyond 0:06:53.240 --> 0:06:56.640 just SpaceX. But yeah, they've been able to access Castle 0:06:56.720 --> 0:06:59.840 pretty easily and they've had some tremendous success. So you 0:07:00.120 --> 0:07:02.720 maybe not a real rush for them, but you know, 0:07:02.800 --> 0:07:04.880 if the time's right, you know, I wouldn't put a 0:07:04.880 --> 0:07:08.520 test Elon Musk to bring another company public, all right, 0:07:08.520 --> 0:07:12.160 we appreciate that, Andrew, really fascinating and discussionary Ander Shan 0:07:12.280 --> 0:07:15.600 and CEO of procure a m Again, they the only 0:07:15.680 --> 0:07:18.840 pure place space et f. It trades under the symbol 0:07:19.080 --> 0:07:22.200 u f O. So if you want exposure to space, 0:07:22.240 --> 0:07:25.720 Matt there you go. Yeah, and it seems like something, 0:07:25.880 --> 0:07:28.400 you know, the kind of exposure that you want to 0:07:28.440 --> 0:07:31.840 have on the very long term, right, you want to 0:07:31.880 --> 0:07:33.880 just take this put in your pocket and not look 0:07:33.920 --> 0:07:35.960 at it for I was gonna say twenty years, but 0:07:36.000 --> 0:07:39.040 probably ten years is um? You know we should be 0:07:39.080 --> 0:07:41.120 at Mars by then, right, ten? Yeah, it would be 0:07:41.160 --> 0:07:43.280 I'll tell you what, you know, it's it's nice having 0:07:43.480 --> 0:07:47.840 Elon Musk. They're supporting the commercial of space flight and 0:07:48.000 --> 0:07:51.440 uh space X. Ever or to consider going public, I 0:07:51.440 --> 0:07:53.640 think there would be a huge demand because A it's 0:07:53.680 --> 0:07:56.960 Elon Musk, but B it's space. It's pretty cool, and 0:07:57.000 --> 0:07:59.520 you can think about some of the commercial aspects going 0:07:59.560 --> 0:08:07.280 for Let's get over to a company called Emblem m 0:08:07.480 --> 0:08:12.280 L sorry m b L M Emblem. They've disemvoweled UM 0:08:12.320 --> 0:08:15.480 their name, which is very trendy lately. I think Aberdeen 0:08:15.480 --> 0:08:18.280 did the same. Uh. This morning, Mario Natarelli joins us. 0:08:18.280 --> 0:08:21.680 He's a managing partner at Emblem and Mario, you've recently 0:08:21.760 --> 0:08:28.600 done conducted your brand intimacy COVID study. Um, it's difficult, 0:08:28.760 --> 0:08:31.200 I think for listeners to imagine what that is. Brand 0:08:31.280 --> 0:08:35.520 intimacy makes my childish mind think of Victoria's secret. But 0:08:35.559 --> 0:08:37.839 when you put it together with COVID, I guess it 0:08:37.880 --> 0:08:40.760 makes sense with COVID also Netflix some chill, But what 0:08:41.360 --> 0:08:46.199 exactly is the brand intimacy study? Oh? Sure, disinvowelled and 0:08:46.720 --> 0:08:51.800 Victoria's secrets. That's a great interest. So yeah, listen, we 0:08:51.840 --> 0:08:54.920 make decisions based on a motion. Behavioral scientists have proven that, 0:08:55.240 --> 0:08:57.360 and yet most of what we do in the branding 0:08:57.400 --> 0:09:00.280 and marketing world is rationally driven. So what we wanted 0:09:00.320 --> 0:09:02.920 to do was measure, not just how brands perform, but 0:09:02.960 --> 0:09:04.720 how do people feel about the brands that they use 0:09:04.800 --> 0:09:07.560 and love. So if we're eleven years in on the 0:09:07.679 --> 0:09:10.640 science of understanding the bonds that we filled with the 0:09:10.679 --> 0:09:14.000 brands that we love, all right, what did we learn 0:09:14.080 --> 0:09:18.120 the pandemic? I'm guessing you know, obviously the pandemic upended 0:09:18.120 --> 0:09:21.960 our daily lives to so many different degrees. What did 0:09:22.000 --> 0:09:25.880 you find in terms of which brands performed well during 0:09:26.080 --> 0:09:29.520 this pandemic? Yeah, it was see. You know, we did 0:09:29.520 --> 0:09:32.079 the study twice pre impost pandemic, and we weren't sure 0:09:32.120 --> 0:09:35.080 what we were going to discover. What we found out 0:09:35.120 --> 0:09:38.160 is that people bonded with brands more during the pandemic 0:09:38.280 --> 0:09:42.400 than prior we thought would do extremely well like Apple 0:09:42.440 --> 0:09:45.240 and Amazon continued to thrive and of course did very well. 0:09:45.440 --> 0:09:49.400 And then no surprise to many, Zoom, uh Purel and 0:09:49.520 --> 0:09:53.200 Netflix were fast risers and took advantage of our you know, 0:09:53.280 --> 0:10:00.280 sequestered lives. So the biggest UH winners during the COVID 0:09:59.760 --> 0:10:04.160 per um we're U S A A. Is that right? Um? 0:10:04.320 --> 0:10:11.000 The United States Automobile Association. Now it comes to services, 0:10:11.480 --> 0:10:14.400 the insurance company. I got it, okay, uh U S 0:10:14.400 --> 0:10:16.599 a A. I'm reading as A as a gearhead is 0:10:16.640 --> 0:10:20.120 a different thing than the banking and insurance can conglomerate. 0:10:21.080 --> 0:10:24.120 How do they land in first place? Yeah, good questions. 0:10:24.160 --> 0:10:26.960 So financial services do historically very poorly in our study, 0:10:26.960 --> 0:10:29.120 which is that a little ironic that the people we 0:10:29.160 --> 0:10:31.920 trust with our money we don't have strong emotional bonds with. 0:10:32.400 --> 0:10:35.080 But U s a A UM finished first in our 0:10:35.160 --> 0:10:39.079 ranking post coded. This is a brand that really understands community. 0:10:39.160 --> 0:10:43.160 It's oriented around service members. UM really understands how you 0:10:43.320 --> 0:10:47.680 emotionally bond and connect with its stakeholders, So probably no surprise. 0:10:47.880 --> 0:10:50.040 It is interesting that most of the financial service brands 0:10:50.040 --> 0:10:53.920 that did well are not the typical iconic retail banks. 0:10:54.360 --> 0:10:58.280 So PayPal, U s a A, even TV Bank rose 0:10:58.360 --> 0:11:01.320 up in the rankings. UH, credit cards and and the 0:11:01.360 --> 0:11:03.959 big banks all did uh, you know, as poorly as 0:11:03.960 --> 0:11:06.000 they usually do in this study. I'm want to go 0:11:06.040 --> 0:11:08.800 out there and say, I think us A A does 0:11:08.840 --> 0:11:13.319 stand for United Services Automobile Association, although we just call 0:11:13.360 --> 0:11:16.760 it USA A. I think that's the actual name for it. 0:11:17.000 --> 0:11:19.280 All right, Well, at least Wikipedia is showing me that 0:11:19.400 --> 0:11:23.559 right now. Anyway, who else did well overall in the study. 0:11:23.559 --> 0:11:26.600 You know, it's interesting brands that sort of harken back 0:11:26.640 --> 0:11:28.720 to kind of fond memories of the past or kind 0:11:28.720 --> 0:11:31.720 of comfort related brands that Campbell's, for example, did extremely well. 0:11:31.760 --> 0:11:34.600 Plus COVID, Ben and Jerry's, for a brand that's all 0:11:34.600 --> 0:11:40.040 about indulgence, did extremely well. Um, automotive brands surprisingly withheld 0:11:40.760 --> 0:11:43.080 and did pretty well during COVID, which we thought would 0:11:43.320 --> 0:11:45.680 they would take a hit, but they didn't. So those 0:11:45.679 --> 0:11:48.000 are just some of the brands that were strong performers. 0:11:48.640 --> 0:11:51.120 All right, Mary, I'm a Wall Street guy. I don't 0:11:51.200 --> 0:11:54.640 don't care about brands. I think you know, marketing is 0:11:54.679 --> 0:11:57.959 just you know, paint of blue and sell it to me. Um, well, 0:11:58.080 --> 0:12:00.839 let me tell you why you're wrong the telling. As 0:12:00.840 --> 0:12:05.120 a stock investor, do I care about brand value. So 0:12:05.280 --> 0:12:08.839 here's the deal. We rank the most intimate brands and 0:12:08.880 --> 0:12:10.760 then we compare them to the top performer brands, and 0:12:10.800 --> 0:12:14.280 the fortune and center iforce indects our brands up foremost 0:12:14.320 --> 0:12:17.320 in revenue and profit every year, short term and long term. 0:12:17.559 --> 0:12:19.839 So if you aren't paying attention of this, you're missing something. 0:12:21.200 --> 0:12:23.400 I mean, the power of brands, Paul is huge. Look 0:12:23.400 --> 0:12:25.840 at Ferrari. You think Race could get a evaluation like 0:12:25.880 --> 0:12:29.040 that if it weren't for the brand. Yeah, against the 0:12:29.400 --> 0:12:32.360 margins help as well. So who who do you think 0:12:32.440 --> 0:12:36.400 is gonna stick in terms because you know, maybe post COVID, 0:12:36.480 --> 0:12:41.000 when the lockdown's over, we're not gonna see um consumers 0:12:41.080 --> 0:12:45.240 care as much about PayPal as they did during you know, 0:12:45.240 --> 0:12:49.959 their online shopping extravaganza. I think PayPal has done very 0:12:50.000 --> 0:12:52.200 well in our study over the ten years. Brands that 0:12:52.240 --> 0:12:55.400 are going to receive maybe Purell probably won't stick as long, 0:12:55.600 --> 0:12:57.839 or maybe Zoom may fade a little. I think those 0:12:57.880 --> 0:13:02.360 brands are working aggressively to build product that's gonna resonate 0:13:02.400 --> 0:13:05.000 with us beyond the pandemic. I think the brands that 0:13:05.200 --> 0:13:08.120 did extremely well, like Amazon and Apple, you know, increase 0:13:08.160 --> 0:13:12.560 their leads and build stronger kind of portfolios. I think 0:13:12.600 --> 0:13:16.640 they're gonna, you know, see that advantage continue. Obviously. Let 0:13:16.640 --> 0:13:18.760 me just say one more thing about brands. You know, 0:13:18.920 --> 0:13:22.520 what's interesting is that brands that are hardware related smartphones, 0:13:22.840 --> 0:13:27.080 brands do extremely well and better than the content or 0:13:27.160 --> 0:13:30.600 the apps or the services on the phone. So another 0:13:30.679 --> 0:13:32.280 thing to kind of think about is the role of 0:13:32.360 --> 0:13:36.240 technology plays and building intimacy. Hey, Mario, thank you so much. 0:13:36.280 --> 0:13:39.160 We really appreciate that. Very interesting study. Mario and not 0:13:39.240 --> 0:13:41.880 a Relly from Emblem talking to us about brand infacy 0:13:41.880 --> 0:13:45.280 and the value of brands. And uh, you know, Matt, 0:13:45.320 --> 0:13:47.080 I kind of asked that question of facetious because I 0:13:47.080 --> 0:13:50.000 have seen a lot of studies that show like positive 0:13:50.040 --> 0:13:54.199 correlation between brand value and shareholder returns here and you 0:13:54.280 --> 0:13:57.080 bring up a great example, you know, Ferrarians and some 0:13:57.120 --> 0:13:59.920 of these other mega brands that I heard this arcasm. 0:14:00.440 --> 0:14:03.760 I knew you were trying to play the devil's advocate 0:14:03.840 --> 0:14:06.400 to some extent, So I think it makes sense though, 0:14:06.440 --> 0:14:09.000 I mean especially I think we've learned more about the 0:14:09.000 --> 0:14:11.080 strength of brands during COVID than we than we need 0:14:11.120 --> 0:14:15.880 to be. All Right, thanks so much, appreciate it. All right, 0:14:15.920 --> 0:14:19.600 let's get our latest update on all things Wall Street. 0:14:19.600 --> 0:14:22.480 We do that with Shale Bassic Bloomberg Wall Street reporter 0:14:22.800 --> 0:14:25.200 Shinnali loves you talk to you about you know, E 0:14:25.400 --> 0:14:26.960 S G investing. It's kind of been a little bit 0:14:26.960 --> 0:14:29.080 of a theme today for us, and it comes on 0:14:29.120 --> 0:14:32.160 the heels of the Biden uh Climate Summit, of the 0:14:32.160 --> 0:14:36.400 Global Summit from last week here what's the perspective of 0:14:36.520 --> 0:14:40.000 kind of our own kicking off today exactly and kind 0:14:40.000 --> 0:14:42.400 of just get a sense of what's the the feeling 0:14:42.440 --> 0:14:45.920 from Wall Streets perspective as to is this really a 0:14:46.080 --> 0:14:49.000 long term investment theme that will be with us for 0:14:49.080 --> 0:14:51.240 some time? Well, yeah, that's the most important thing. It 0:14:51.320 --> 0:14:53.600 has to be long term because none of these things 0:14:53.720 --> 0:14:56.680 change over time. And with a lot of these issues right, 0:14:57.400 --> 0:15:02.240 namely climate and also what's so issues, namely race um, 0:15:02.560 --> 0:15:04.920 they have been problems that have been brewing for a 0:15:04.960 --> 0:15:08.800 long time, and frankly, the financial industry has exacerbated in 0:15:08.840 --> 0:15:11.240 a lot of ways. So you know, at the end 0:15:11.280 --> 0:15:14.240 of the day, you look back to the people who 0:15:14.320 --> 0:15:17.160 are counting on these investors, right that the people who 0:15:17.400 --> 0:15:20.040 have their pension funds at stake that have been very 0:15:20.120 --> 0:15:23.960 vocal and very loud and forcing these changes that you know, 0:15:24.120 --> 0:15:28.960 really the the large asset managers are are really starting 0:15:29.000 --> 0:15:32.160 to step up now, but hopefully kept to be held 0:15:32.160 --> 0:15:36.120 accountable too. So we have, as I said, this Green 0:15:36.200 --> 0:15:39.240 Summit kicking off today. It's a two day summit. Um. 0:15:39.280 --> 0:15:42.520 There's some huge names. I know. Francine Lackwa talked to 0:15:42.880 --> 0:15:45.400 Al Gore. He's got to be kind of the poster 0:15:46.440 --> 0:15:49.880 politician for UM the green movement. And you're going to 0:15:49.960 --> 0:15:55.000 talk to Melody Hobson later today, who runs Ariel Investments. 0:15:55.000 --> 0:15:58.520 But she's also I mean she's now she's the chairwoman 0:15:58.520 --> 0:16:01.280 of Starbucks, but she used to be the chair dream 0:16:01.320 --> 0:16:04.440 Works as well. A huge career here. What does she 0:16:04.520 --> 0:16:06.440 have to say about E. S G. Yeah, it's really 0:16:06.440 --> 0:16:10.000 interesting because she's a major board member right, a board 0:16:10.040 --> 0:16:11.800 of She's on the board of JP Morgan and as 0:16:11.840 --> 0:16:14.560 you said, share of Starbucks, So she has influence in 0:16:14.600 --> 0:16:17.520 that way. But they're also an investor right over at 0:16:17.520 --> 0:16:20.960 our Investments, and so how do they vote with their feet? Right? 0:16:21.040 --> 0:16:24.320 How do they hold companies to account? What we're finding 0:16:24.440 --> 0:16:28.000 is two sorts of approaches. Right, you have this terminal 0:16:28.040 --> 0:16:31.680 headline right now on black Rocks lettery seeking activism, right, 0:16:32.040 --> 0:16:35.680 forcing those changes. Uh, Hobson's firm is trying to work 0:16:35.680 --> 0:16:38.040 with companies to to really get them to be more 0:16:38.040 --> 0:16:41.680 constructive and change the way they hire suppliers, look at 0:16:41.680 --> 0:16:45.200 more minority owned businesses. When it comes down to it, 0:16:45.560 --> 0:16:49.400 our arial in itself is really trying to invest in 0:16:49.440 --> 0:16:51.920 more minority owned businesses as well as work at the 0:16:51.920 --> 0:16:56.000 companies they they invest in. There's something interesting happening that 0:16:56.080 --> 0:16:59.400 I wanted to point to this coming weekend, for example, 0:16:59.640 --> 0:17:04.719 is Warren Buffett's annual meeting. What they are facing is 0:17:04.880 --> 0:17:09.080 also company their own shareholders who are very frustrated with 0:17:09.320 --> 0:17:12.760 social issues that they're facing, the impacts of their business 0:17:12.920 --> 0:17:16.159 on the customers and employees around them, and as well 0:17:16.200 --> 0:17:20.400 as environmental issues. Right now, Newberger Berman has votes that 0:17:20.640 --> 0:17:23.160 are out there that are really trying to force change 0:17:23.560 --> 0:17:26.159 among one of the biggest investors in the world. So 0:17:26.200 --> 0:17:29.720 it's interesting we this is growing momentum clearly, Chanale for 0:17:29.920 --> 0:17:32.680 as you're reporting for uh E s G, and it 0:17:32.720 --> 0:17:35.280 seems like the focus has been on environmental maybe a 0:17:35.280 --> 0:17:37.760 little bit less so on social and governance. I mean, 0:17:37.760 --> 0:17:41.639 even though the tech company screen well on you know, environmental, 0:17:41.880 --> 0:17:43.800 you take a look at some of their supervoting share 0:17:43.840 --> 0:17:47.280 structures just for example, and that doesn't mark well a 0:17:47.359 --> 0:17:50.120 grade well for the governance issue, yeah, that's for sure. 0:17:50.119 --> 0:17:52.040 And there's a lot of pressure on the SEC to 0:17:52.119 --> 0:17:54.240 kind of change the way that they force people to 0:17:54.320 --> 0:17:56.520 disclose things, right because at the end of the day, 0:17:56.560 --> 0:17:59.560 a lot of this comes down to disclosure on top 0:17:59.720 --> 0:18:03.679 of you know, just companies saying that they're doing the 0:18:03.800 --> 0:18:06.840 right thing, and so you know, on the social issues 0:18:06.840 --> 0:18:09.560 in particular, you know, we're coming up on one year 0:18:09.600 --> 0:18:12.399 since George Floyd has been murdered, right, we are also 0:18:12.440 --> 0:18:15.400 coming up on a hundred years since the Tulsa race massacre. 0:18:15.920 --> 0:18:20.159 You know, these issues are very very real to a 0:18:20.320 --> 0:18:23.960 lot of people who are demanding not just change but 0:18:24.080 --> 0:18:26.760 also disclosure. And you know, on top of climate, you're 0:18:26.800 --> 0:18:30.879 seeing these social issues really come to the forefront of 0:18:30.920 --> 0:18:34.560 the investment community's minds and where can they use their 0:18:34.560 --> 0:18:38.120 own money to create change? And the race issues as well, 0:18:38.400 --> 0:18:41.879 um which we see in in all other facets of 0:18:41.920 --> 0:18:45.320 American life. It's interesting that Melody hops and when she 0:18:45.480 --> 0:18:48.960 was named the chairwoman of Starbucks, was the first black 0:18:48.960 --> 0:18:52.480 woman ever to be the chairwoman or chair well, I 0:18:52.520 --> 0:18:55.440 guess it could only be a chairwoman of of any 0:18:55.720 --> 0:18:59.359 SMP five companies. So she's making waves there. And of course, 0:18:59.840 --> 0:19:03.399 as you point out, running aerial investments can also vote 0:19:03.400 --> 0:19:06.119 as an investor. Shinnelli Boss, thanks very much for that. 0:19:09.800 --> 0:19:14.400 Let's bring in Kevin Tynon joins us from Bloomberg Intelligence. 0:19:14.480 --> 0:19:17.280 He's our go to guy when it comes to reporting 0:19:17.280 --> 0:19:22.159 on the automakers and um, a senior autos analyst. I 0:19:22.160 --> 0:19:27.280 don't know if you're titles guy analysts. Yeah, I'm I've 0:19:27.280 --> 0:19:30.280 been asking Kevin for advice on cars for at least 0:19:30.720 --> 0:19:35.120 fifteen years. I'd say, so, he's a he's got the crease. 0:19:37.000 --> 0:19:39.960 I actually, I actually, I know we're gonna talk about Tesla, 0:19:40.080 --> 0:19:42.280 but before we get to it, you, me and Paul 0:19:42.320 --> 0:19:46.000 have all been pretty interested in the mock E and Uh, 0:19:46.160 --> 0:19:48.480 I think that you've had a chance to drive Ford 0:19:48.560 --> 0:19:51.920 Mustang mach E. It's tough to get a dealership lots 0:19:51.960 --> 0:19:55.920 across America. It looks so cool, and I've heard positive reports. 0:19:55.960 --> 0:19:57.680 So I wanted to know, have you had a chance 0:19:57.720 --> 0:19:59.800 behind the wheel, and what do you think I have? 0:20:00.040 --> 0:20:03.040 I had it for um for about a week, a 0:20:03.080 --> 0:20:05.520 couple of weeks ago, maybe about a month ago. UM, 0:20:06.119 --> 0:20:11.760 and I guess I was totally whelmed, neither neither over 0:20:11.960 --> 0:20:15.560 nor underwhelmed by it. Um, and I have to say 0:20:15.600 --> 0:20:17.879 it was a little chilly. Well, let me give you 0:20:17.880 --> 0:20:19.680 two things that that kind of jumped out at me. 0:20:19.800 --> 0:20:22.200 One was I had to drive it to the office, 0:20:22.240 --> 0:20:24.119 and I don't live far from this office, and we 0:20:24.160 --> 0:20:28.760 have charging stations here because right right, So I wanted 0:20:28.800 --> 0:20:31.240 to give it back with to Ford with a full 0:20:31.320 --> 0:20:34.879 charge on it. So I had it charges at three 0:20:35.080 --> 0:20:39.800 miles of range per hour. So if I left it overnight, 0:20:39.840 --> 0:20:42.800 I would have had about, you know, forty miles of 0:20:42.960 --> 0:20:46.040 range on It's got to be a faster way there is. 0:20:46.080 --> 0:20:48.160 But I mean, I don't have a you know, a 0:20:48.240 --> 0:20:50.320 level two charger in my garage. That would have just 0:20:50.359 --> 0:20:53.200 been plugging it into the outlet you know where I 0:20:52.960 --> 0:20:56.120 where I plugged my compressor. So um, and then when 0:20:56.119 --> 0:20:58.200 it was full, it only read a hundred and eighty 0:20:58.240 --> 0:21:00.240 miles of range. And then the other thing was while 0:21:00.280 --> 0:21:04.200 I was driving it in that cold March morning, the 0:21:04.520 --> 0:21:07.480 you know, the big guy pad stuck to the dashboard froze, 0:21:08.320 --> 0:21:11.719 so I couldn't I couldn't change the radio station. I 0:21:11.760 --> 0:21:14.800 couldn't change the temperature. I couldn't, you know, because it's 0:21:14.800 --> 0:21:17.119 sort of like the way Tesla doesn't wear. Everything runs 0:21:17.119 --> 0:21:21.080 through that center that center screen. So once it froze, 0:21:21.119 --> 0:21:24.480 and it restarted right away and was fine after you know, 0:21:24.560 --> 0:21:28.040 I I restarted the car, but um, but it was 0:21:28.119 --> 0:21:31.000 just kind of strange that I couldn't do anything, you know, 0:21:31.080 --> 0:21:38.280 I had to listen to hair Nation blasted all right, Kevin, 0:21:38.520 --> 0:21:41.480 So are our good friend Elon musk Uh and Tesla 0:21:41.520 --> 0:21:43.760 report earnings after the clothes today. We know that the 0:21:43.840 --> 0:21:46.840 deliveries came in better than expected. What are you really 0:21:46.880 --> 0:21:50.520 gonna be looking for at this quarter? Um, you know, 0:21:50.560 --> 0:21:53.159 I think a lot the delivery number was similar to 0:21:53.200 --> 0:21:54.920 the fourth quarter, so you know, I think a lot 0:21:54.920 --> 0:21:58.200 of things will probably be sequentially in line with what 0:21:58.359 --> 0:22:00.879 we saw at the end of And I think I 0:22:01.240 --> 0:22:03.600 don't know what what other people want, but for me, 0:22:03.680 --> 0:22:06.360 I think what will be interesting will be the trajectory 0:22:06.440 --> 0:22:10.760 of the regulatory credit sales this year. Right. Those were 0:22:11.400 --> 0:22:15.520 one point six billion dollars last year and it put 0:22:15.600 --> 0:22:18.359 them at you know, one point two billion in profits. 0:22:18.400 --> 0:22:22.240 So you know, it'll be interesting to see how those, um, 0:22:22.280 --> 0:22:25.840 you know, reconciled to each other quartered a quarter as 0:22:25.840 --> 0:22:30.000