Speaker 1: I'm Caroline Higher Bloomberg's world headquarters in New York, and
Speaker 1: i'md Ludlow in San Francisco. This is Bloomberg Technology. Well.
Speaker 1: Biger's return as Disney CEO comes as the company deals
Speaker 1: with challenges both internal and external. Ahead the biggest priorities
Speaker 1: for the comeback King of Content and Genesis is warning
Speaker 1: of a bankruptcy without new funding. As coin base hits
Speaker 1: a record low, the entire industry faces a liquidity crunch,
Speaker 1: and we've learned US prosecutors opened a probe of FTX
Speaker 1: months before its collapse. Plus will break down how tech
Speaker 1: layoffs create a wave of issues for non US citizens
Speaker 1: that worked for Silicon Valley giants. But first and foremost,
Speaker 1: let's get to the breaking news. As Bloomberg is reporting
Speaker 1: the digital asset brokerage, as you just said, the Genesis
Speaker 1: struggling to raise fresh cash for a lending unit and
Speaker 1: it's potential investors that it may we say, may need
Speaker 1: to fall for bankruptcy if it's efforts fail. So according
Speaker 1: to sources, and say best I can said, because she
Speaker 1: was indeed one of the byelines on the story. One
Speaker 1: of the key reporters, and Shally told us thus fall
Speaker 1: Genesis coming back and saying, look, this is an imminent
Speaker 1: but they have been trying to raise funds for some
Speaker 1: while now right, they have been trying to raise funds
Speaker 1: four days. Remember they had halt and withdrawals at the
Speaker 1: lending unit just last week, in the middle of last week,
Speaker 1: and since then they have been in talks with investors,
Speaker 1: including now we're reporting finance now. Funding has so far
Speaker 1: failed to materialize, and they've been warning a group of
Speaker 1: investors that they may need to file for bankruptcy, certainly
Speaker 1: at lending unit, if those talks do not materialize into
Speaker 1: funding now. Remember Genesis is a huge player in the
Speaker 1: institutional space. Their trading desk has separately reported an exposure
Speaker 1: to f t X. But we are now starting to
Speaker 1: see more effects of what has happened here that you
Speaker 1: could argue was contagion that started back to three arrows,
Speaker 1: let alone current A. When it comes to the ft
Speaker 1: x A vocals SINALI. What's happening behind the scenes? How
Speaker 1: much cash do the Genesis think they need? Is this
Speaker 1: happened in the last twenty four hours, in the last
Speaker 1: two weeks? What's happening behind closed doors? Days? Remember they
Speaker 1: halted withdrawals in the middle of last week, let's say Wednesday,
Speaker 1: and then they had over the days after that starting
Speaker 1: to look for money. With the way that my sources
Speaker 1: describe what was happening was that a lot of these
Speaker 1: talks really amplified into the weekend. H And again remember
Speaker 1: that this is still they have not filed yet. They're
Speaker 1: not said that they're going to file yet. They have
Speaker 1: told us on the record, by the way, that they
Speaker 1: don't have plans to file imminently, and their goal is
Speaker 1: to resolve the current situation consensually without the need for
Speaker 1: bankruptcy filing. But as we know that this is still
Speaker 1: a huge risk. Now remember there are benefits to bankruptcy
Speaker 1: as well. It would contain a situation here and remember
Speaker 1: this is part of the broader Digital currency Group empire,
Speaker 1: where we do not have indications that this is a
Speaker 1: broader problem when you look at this empire that was
Speaker 1: built by Barry Silberg. So I think that as very
Speaker 1: important part of this story here which assets within that
Speaker 1: empire we are talking about, and how far that contagion
Speaker 1: can potentially go as we as we plan for a
Speaker 1: potential bankruptcy for this unit. Yeah, just talked to us
Speaker 1: a little bit about Digital Currency Group as well, and
Speaker 1: the efforts that will already be made by Barry Silbert
Speaker 1: too will propop that in time DISR group because thus
Speaker 1: far it has been noted that money has been to
Speaker 1: put that to ensure that suddenly post Three Arrows the
Speaker 1: implications weren't too destructive. It's an important question. Remember after
Speaker 1: Three Arrows, a part of the empire here was said
Speaker 1: to have been a creditor to the Three Arrows Group.
Speaker 1: So why is that so important today? Because as investors
Speaker 1: look at this asset, to the point that you are
Speaker 1: getting at here is that they do want to untangle
Speaker 1: the relationship between Genesis Lending, Genesis Trading, and the rest
Speaker 1: of Digital Currency Group. Now, remember the rest of the
Speaker 1: empire is super important to the crypto space that includes
Speaker 1: a GBTC, the Gray Scale Bitcoin Trust, Great Scale as
Speaker 1: a company. But right now, what we do know and
Speaker 1: I would say I work about tune us over at
Speaker 1: the Bloomberg Intelligence has been brilliant at pointing this out.
Speaker 1: The company itself spits off a lot of money based
Speaker 1: on what they are getting in terms of managing the
Speaker 1: assets for the Great Scale bus Coin Trust. So That's
Speaker 1: why again it's so important here to say what is
Speaker 1: revenue generating, what is still okay today and what parts
Speaker 1: of the business here are we more concerned about. But
Speaker 1: then importantly for investors, what is the relationship between all
Speaker 1: the entities at the end of the day. All right,
Speaker 1: bloombergs Shinali Bassek, thank you. Let's tend now to Disney
Speaker 1: after the bombshell announcement that Bob iger is coming back
Speaker 1: to the company Rosco, that is CEO and co founder
Speaker 1: of Gerba Kawasaki, two billion dollars in assets under management,
Speaker 1: and importantly Caroline a Disney shareholder. So ross your reaction.
Speaker 1: I was so happy when I saw the news last night.
Speaker 1: I thought I was dreaming and and it was like
Speaker 1: my dream came true. Bob Japeck had been running the
Speaker 1: business into the ground and had made some crucial errors
Speaker 1: in handling some very difficult situations. But it's time to
Speaker 1: really refocus the business back on creating great content for
Speaker 1: a reasonable cast. Okay, So ross in terms of your
Speaker 1: prioritization here, and I want to bring to our audience
Speaker 1: a poll that we went to Twitter with. I know
Speaker 1: you're a big player on Twitter with hundreds of thousands
Speaker 1: of followers, But we've been shining a light on what
Speaker 1: they think the prioritization should be. Now, is it the
Speaker 1: cost controls? Is it more thinking about content the streaming
Speaker 1: perspective at the moment? Is it ross? Actually? Of course,
Speaker 1: what is the internal management of this business because Bob
Speaker 1: Chapeck himself had made some well, very criticized decision making
Speaker 1: when it came to the politics within Florida and what
Speaker 1: the company stands for. From your perspective, streaming strategy is
Speaker 1: number one for our audience right here, right now. Is
Speaker 1: it number one for you? Yeah? For sure. I mean
Speaker 1: the streaming business that they've built over the last several
Speaker 1: years is amazing, and it was really led by Igor
Speaker 1: at the beginning to get into streaming, and and so
Speaker 1: they got to this point where they now have hundreds
Speaker 1: of millions of subscribers, but their losses have balloon, And
Speaker 1: I'm not really sure why there was such a lack
Speaker 1: of focus on the cost controls, especially last quarter, because
Speaker 1: the rest of the business like parks and resorts and
Speaker 1: and and as well as the hotels and and the
Speaker 1: cruise ships, many elements of the business are booming right now.
Speaker 1: And hugely profitable. So we actually expected Disney to beat
Speaker 1: profits nicely this quarter, and it was like, where did
Speaker 1: this extra billion uh spent on on the streamers go?
Speaker 1: And so you know, Disney, Disney Plus and and Hulu
Speaker 1: have are great assets. ESPN Plus, they're great assets, and
Speaker 1: they've had a lot of money investment. But it's time
Speaker 1: to make this business profitable and and and make sense economic.
Speaker 1: Let's bring you son of what Bob said in a
Speaker 1: statement Sunday night when he was named to see a first.
Speaker 1: Of all, he seems as surprised as the rest of us,
Speaker 1: using the word amazement, but he also talks about these
Speaker 1: times remain quite challenging. I suppose you're referring to macro
Speaker 1: conditions you talked about profit is it's just you can't
Speaker 1: just turn the tap off and suddenly the losses from
Speaker 1: streaming go away and everything's dandy. How materially does he
Speaker 1: fix things at Disney? Well, I think you've got, really
Speaker 1: I would say three main issues that Disney faces. So
Speaker 1: the first, which we've been discussing, is how do we
Speaker 1: build a streamer with the right economics? And it's actually
Speaker 1: not that hard because you do have a certain level
Speaker 1: of certainty of what your revenue is going to be
Speaker 1: because it's a reoccurring revenue model. So Disney and Apple
Speaker 1: just recently raised prices on their streamers, so they can
Speaker 1: pretty well guess what they're going to take in revenue
Speaker 1: wise over the next twelve months. And they just need
Speaker 1: to right size the budget for it so that that
Speaker 1: isn't that big of a deal. You just have to
Speaker 1: do the right math. The second thing Disney needs to
Speaker 1: address is China. This is the really big difficult challenge
Speaker 1: that many of my companies are facing, whether it be
Speaker 1: the MGM and Macau or Tesla and Shanghai. You know,
Speaker 1: we're just facing so much uncertainty in the Shanghai park
Speaker 1: is closed again and this is a big challenge for them,
Speaker 1: despite the rest of the park's business doing extremely well.
Speaker 1: And then the third thing is what are they going
Speaker 1: to do with their sports business. I personally love the
Speaker 1: ESPN brand in business, and I think that they need
Speaker 1: to be deeper in sports and deeper in sports betting,
Speaker 1: and and if not, just get out of the sports
Speaker 1: business and and spin it off or sell the ESPN brand.
Speaker 1: But I think they need to make a decision on
Speaker 1: what they're going to do with sports in the future. Now,
Speaker 1: I think Disney should stay in the sports business. But
Speaker 1: but I think I will assess these things and make
Speaker 1: some great decisions, and soon enough we'd like you to
Speaker 1: see the monetization in some parts of Disney plus lust.
Speaker 1: I'm interested in the people behind Disney plus the executives.
Speaker 1: I mean, we know that bomb Iger might well be
Speaker 1: thinking of his lgbt Q plus community and how response
Speaker 1: to them post the politicization of all of that, But
Speaker 1: talk to us about the executives who institute do the roles.
Speaker 1: Talk about the people who perhaps were given a backseat
Speaker 1: unto Chapec, and how that changes. So this part of
Speaker 1: Disney was going back to Igor's days when they bought Fox.
Speaker 1: So when they integrated Fox, there was just like almost
Speaker 1: a lot of the Disney people left and Fox people
Speaker 1: on the television and the movie side sort of stayed
Speaker 1: and and and that's been good, I think for Disney.
Speaker 1: But I think Chpec really was not great with talent,
Speaker 1: and I don't think he had any vision for the
Speaker 1: artists or the artistry part of making the magic of Disney.
Speaker 1: And that's what Igor has that that is really hard
Speaker 1: to quantify. So so I think this is like a
Speaker 1: really big thing. Is I do think they have great
Speaker 1: executives managing their businesses, but I think they need some
Speaker 1: direction as far as content is concerned, and and sort
Speaker 1: of like somebody would taste, and that's what Iger has
Speaker 1: that Chapex certainly doesn't. But I still think the integration
Speaker 1: of Disney and Fox in a way is still not
Speaker 1: a d percent complete, and I think there needs to
Speaker 1: be this finality to it. Ross. Did you buy more
Speaker 1: Disney shares on Monday? Well, you know, I run a
Speaker 1: public E t F. G K is my e t
Speaker 1: F and and I did buy Disney today and and
Speaker 1: I don't know if that's been actually posted yet, um,
Speaker 1: but but it's posted anyways at five o'clock Eastern, so
Speaker 1: the markets are closed. So I did by Disney aggressively today.
Speaker 1: All right, let's think about the other company. I think
Speaker 1: it's wildly undervalued. I think it's wildly undervalued. And and
Speaker 1: with Eiger back, I think it's a whole another business
Speaker 1: to look at. Now, another business to look at Twitter,
Speaker 1: you're an investor in the private entity. Bloomberg reported that
Speaker 1: layoffs continued Monday, focus on sales and marketing. What do
Speaker 1: you make of that? Well, I think you're going to
Speaker 1: see the same thing at Disney. So I think if
Speaker 1: you look at tech companies across the board, um, Twitter
Speaker 1: and Fluted and probably more extreme than most, is we're
Speaker 1: seeing this resizing of the tech industry across the entire industry.
Speaker 1: And and that's really part of that is from the
Speaker 1: pandemic boom to now bust. Uh and now you know,
Speaker 1: also just a more realistic view of what costs and
Speaker 1: content are going to be used and achieved. But Twitter
Speaker 1: was wildly overstaffed and and now they're going to move
Speaker 1: to a staff level that's probably wildly understaffed, and then
Speaker 1: they're gonna build, and they're gonna build by hiring. So
Speaker 1: I think people are thinking like, oh, this is gonna
Speaker 1: like be the permanent size of Twitter will be extremely small,
Speaker 1: and I don't think that's correct. What this is going
Speaker 1: on is a corporate restructuring where a new culture is
Speaker 1: being built at Twitter, and one that will be much
Speaker 1: more productive for the company, the users, and its shareholders.
Speaker 1: Your perspective there was I'm interested in what though might
Speaker 1: occur with a luck says wildly understaffed all their risks
Speaker 1: all their concerns while it is so well, I've been
Speaker 1: you know, monitoring Twitter, you know, very closely from my
Speaker 1: own experiential, uh point of view to see if there
Speaker 1: has been any change, and I've actually would argue that
Speaker 1: Twitter is better now that Ellen has taken over then before.
Speaker 1: The engagement on Twitter has been off the charts over
Speaker 1: the last couple of weeks. Not to mention all the
Speaker 1: news and information, but Twitter is still the most incredible
Speaker 1: source of news besides Bloomberg. When you're looking at Sam
Speaker 1: Banquin Freed live tweeting during his fraud, you know it's
Speaker 1: it's only on Twitter. And so whether if I want
Speaker 1: news on Ukraine, I'm sorry, I have to go to Twitter.
Speaker 1: And so it's a crucially important news and information site
Speaker 1: and one that Ellen is working very hard to protect.
Speaker 1: Its integrating and I think twitters as good as ever
Speaker 1: Russ as an investor in Twitter who wants a long
Speaker 1: term return, one thing you want to see Elon must
Speaker 1: do with the platform ad add creator engagement opportunities. So
Speaker 1: by adding YouTube and you know these kind of features
Speaker 1: where creators can get on the platform and make a living. Um,
Speaker 1: we post a lot of video on on Twitter and YouTube,
Speaker 1: and and everybody has to monetize through YouTube. So I
Speaker 1: think the creator opportunity on Twitter as a platform is enormous,
Speaker 1: and I think YouTube should be scared. All Right, Rosco,
Speaker 1: the CEO and co founder of the Kawasaki Thank You,
Speaker 1: coming out. We'll have the latest on the ticket Master
Speaker 1: and Taylor Swift debacle and the d j's role in
Speaker 1: all of this. This is blamed. Let's talk about Live
Speaker 1: Nations ticket Master, the system crash that of course dashed
Speaker 1: the hopes of Mania. Taylors were found for a concert ticket.
Speaker 1: Turns out, long after the Justice Department started probing into
Speaker 1: all of this to think whether Live Nation is a
Speaker 1: using its power of the live music industry. That's all
Speaker 1: according to sources, and pleased to save new meg intelligences.
Speaker 1: And Jennifer Ree is here when more on this end
Speaker 1: because we want to be discussing with Jennifer the great
Speaker 1: deck that she put out full blue Meg Intelligence about
Speaker 1: why aren't you reminding us this isn't the first time
Speaker 1: the d o J has got interested in what was
Speaker 1: an emin ad done years ago. Jennifer, Yeah, so you
Speaker 1: know this has been going on for a really long time.
Speaker 1: You know, I think the Taylor Swift debacle kind of
Speaker 1: brought this to the headlines. But honestly, there have been
Speaker 1: critics of Live Nation and groups that have called for
Speaker 1: the deal that was closed in two thousand ten to
Speaker 1: be unwound by the d J really ever since it closed.
Speaker 1: And the DJ started investigating after settling with the companies
Speaker 1: in two thousand ten, probably as early as two thousand twelve,
Speaker 1: only a few years after they actually were merged, because
Speaker 1: they believed that they were already violating in consent agreement
Speaker 1: that they signed in two thousand ten. Now I don't
Speaker 1: know exactly when that investigation started, but what had ended
Speaker 1: was in two thousand nineteen, and the d o J said,
Speaker 1: in fact, we do believe they've been violating these terms
Speaker 1: they were supposed to behave in a certain way towards venues.
Speaker 1: They promised to behave in that way, not to force
Speaker 1: or coerce the venues to use Ticketmaster, allow them to
Speaker 1: use rivals to Ticketmaster, and in fact they've renigged on that.
Speaker 1: So we're going to enter another settlement with them. And
Speaker 1: that settlement was signed in late two thousand nineteen. And
Speaker 1: now I think what's going to happen. Is the d
Speaker 1: J is going to look again to see are they
Speaker 1: still violating that newer amended agreement from two thousand nineteen,
Speaker 1: and are they even doing more in the market that's
Speaker 1: anti competitive? Jen, what's the threshold this time around? What
Speaker 1: is it that they'd be looking for that would be
Speaker 1: enough for an enforcement action? You know, that's a good question,
Speaker 1: and they actually have two different thresholds because the consent
Speaker 1: order that they agreed to in two thousand nineteen lowered
Speaker 1: the threshold. This is something Live Nation agreed to for
Speaker 1: the d o J to show that they've been violating
Speaker 1: that consent order. So if they're trying to show that, hey,
Speaker 1: they agreed to this, they're not abiding by these terms,
Speaker 1: we have a pretty low threshold to prove that that's
Speaker 1: what's happening in court. So that's why threshold um. I
Speaker 1: think this is the kind of proof and evidence that's
Speaker 1: fairly easy for the d o J to collect. They
Speaker 1: just go out and talk to venues and find out
Speaker 1: what their communications have been with Live Nation and with Ticketmaster.
Speaker 1: But I think the second thing the d o J
Speaker 1: might be looking at is more broadly is Live Nation
Speaker 1: and Ticketmaster entering into exclusive agreements with so many big
Speaker 1: venues that they're basically blocking out smaller rivals who can
Speaker 1: no longer contract with those venues because they're exclusive to Ticketmaster.
Speaker 1: That's a little bit of a higher threshold something I
Speaker 1: think they could also prove in court though. If you
Speaker 1: are a company with market dominance, and it's alleged here
Speaker 1: that Live Nation does have market dominance, it is illegal
Speaker 1: to tie up more than about thirty five of the outlet,
Speaker 1: And if that's what they're doing with these exclusive agreements
Speaker 1: or quasi exclusive agreements, that would violate the antitrust laws. Jennifer,
Speaker 1: when the measure had is a long time ago. Yes,
Speaker 1: told to us about the speed at which any of
Speaker 1: this I could unfold, Well, it's really slow. I mean,
Speaker 1: as you heard, the mergers in according to the d
Speaker 1: o J when they came out with papers in two
Speaker 1: thousand nineteen, the deal had been violated since two thousand twelve, right,
Speaker 1: and they didn't settle into till two nineteen. So these
Speaker 1: investigations can go for two or three years. But I
Speaker 1: think that the DJ investigation that's ongoing now did start
Speaker 1: a few years ago. You know, I went back and
Speaker 1: I looked at how often we at Bloomberg Intelligence had
Speaker 1: published about antitrust problems Live Nation could have, and we
Speaker 1: wrote in two thousand eighteen, we wrote in two thousand nineteen,
Speaker 1: and we wrote in two thousand twenty. So I think
Speaker 1: it's very possible something could happen next year in two
Speaker 1: thousand twenty three, and enforcement action more likely than a settlement.
Speaker 1: All right, Bloomberg Intelligence is Jennifer Ree, Thank you, Thank
Speaker 1: you time now for our top tech calls. Moffatt Nathanson
Speaker 1: upgrading Disney to outperform, expecting the company to re examine
Speaker 1: a streaming strategy after reinstating bob IgA to the top job.
Speaker 1: Self driving tech name Mobili initiated with the street high
Speaker 1: seventy seven dollar price target. It's City Group. The firm
Speaker 1: has put a by rating on Mobili, saying there's a
Speaker 1: path to hitting fifty billion dollars of revenue by and finally,
Speaker 1: Argust downgrading online and car vending machine company car Varna
Speaker 1: to sell. The firm says the company will struggle to
Speaker 1: make a profit as used car prices continue to drop.
Speaker 1: Those of your top techles welcome back to putting back technology.
Speaker 1: Some breaking news, of course, to fall out after the
Speaker 1: reappointment of Bob Iger at Disney. We understand that at
Speaker 1: the moment he's asking Disney managers to reconsider the corporate structure. Already,
Speaker 1: we've started to see that the distribution chief, Kareem Daniel,
Speaker 1: is stepping deep down. We understand, of course this executive
Speaker 1: was particularly close to Bob Jpeck. So Bob Igor is
Speaker 1: announcing changes in a company memo as it stands, So
Speaker 1: Kareem Daniel, being the chairman of Media and Entertainment Distribution,
Speaker 1: will continue to bring you all the latest when it
Speaker 1: comes to dis Knee and some of the restructuring there. Meanwhile, though,
Speaker 1: there's restructure and going across technology more broadly, mass tech
Speaker 1: layoffs have left hundreds of workers living right here in
Speaker 1: the United States on just temporary visas, were little or
Speaker 1: next to no time to find another job, and indeed
Speaker 1: they have to leave the country. And how could this
Speaker 1: change the U S tech landscape more broadly, Yeah, it's
Speaker 1: an interesting one. Tech companies rely on the H one
Speaker 1: B visa for computer engineering talent right from all around
Speaker 1: the world. The numbers behind this Bloomberg analysis of fascinating
Speaker 1: H one B vis has captin a five thousand per year.
Speaker 1: This group of six tech companies on your screen are
Speaker 1: behind forty five thousand of them, both new and renewed
Speaker 1: over the last three years. Just those six names, alan
Speaker 1: As you can see from the chart, H one bees
Speaker 1: make up a significant okay, not a majority, but a
Speaker 1: significant amount of the overall workforce. So to answer your question,
Speaker 1: if a tech workers laid off and they have to
Speaker 1: return home to their home nation as a result of
Speaker 1: losing their job, there's a cost to the lawyer that
Speaker 1: has to be covered for the travel back to that
Speaker 1: home nation. The cost is also a big part of
Speaker 1: this story, right, Why are layoffs happening? Cost saving measures
Speaker 1: are a part of it. H one B visas also
Speaker 1: carry higher average pay. Generally speaking, the national average for
Speaker 1: H one B in terms of pay, if we bring
Speaker 1: up that next chart, is around a hundred and six
Speaker 1: thousand dollars per H one B visa employee. But you
Speaker 1: look across the tech sector again those same six names,
Speaker 1: that average pushes higher and higher in terms of the
Speaker 1: salary than an H one B visa employee can command.
Speaker 1: And things are changing. Think about all the reports we've
Speaker 1: done recently, Caroline on Twitter, those staff that have been
Speaker 1: laid off here in the United States, and the reporting
Speaker 1: that the Bloomberg has done about them trying to find
Speaker 1: new roles talking with recruiters. I really encourage the audience
Speaker 1: go on Bloomberg dot com, get your Business Week magazine
Speaker 1: hard copy and take a look at this story. Fascinating
Speaker 1: data analysis and all over linked in many getting onto
Speaker 1: communication with across WhatsApp using any technology outlet really possible
Speaker 1: to try and find mind a new sponsor. I used
Speaker 1: to White Dixon White Chief people Officer and legal advisor
Speaker 1: can bring us her expertise, of course, previously held legal
Speaker 1: and HR positions at Disney. At we work and are
Speaker 1: used to. This is a really emotional time for many.
Speaker 1: The dependency of certain people upon their companies to sponsor them,
Speaker 1: to let them remain a mortgage pair in the US,
Speaker 1: their children remain at school here. Overall the company the
Speaker 1: building box of a life they make. We're hearing that
Speaker 1: certain companies are taking different ways of supporting them. We
Speaker 1: know that Meta for example, trying to find ways to
Speaker 1: delay some of that overall notification and notice period that
Speaker 1: people serve. What are the best ways companies can make
Speaker 1: this transition, I think the best way is to a
Speaker 1: be honest about what they can do, what they can
Speaker 1: have fund in, what they can afford right now. I
Speaker 1: think that if you are on an H one B
Speaker 1: visa and you are in the middle of your visa stay,
Speaker 1: trying to get on with another tech company will be
Speaker 1: amazing at this point, although it seems like the largest
Speaker 1: tech companies are setting for a layoff right now, so
Speaker 1: maybe looking at a smaller tech company that still has
Speaker 1: a budget and the ability to sponsor. But I think
Speaker 1: from a company standpoint, companies are looking at the talent
Speaker 1: that they cannot lose no matter what and keeping those
Speaker 1: people sponsored. And for other people, they are trying to
Speaker 1: get them an extension for as long as they can,
Speaker 1: because there are so many people who have adjusted their
Speaker 1: lives believing that they would be in the US sponsored
Speaker 1: by an employer. From a more macro perspective, time and
Speaker 1: time again, everyone's wondered when this is going to show
Speaker 1: up in the numbers, when the non farm payrolls are
Speaker 1: going to show some of the job layoffs. So we're
Speaker 1: seeing in technology and the response I've been getting is, look,
Speaker 1: these are very talented individuals who will find it very
Speaker 1: quick to find another role. Is that the case are
Speaker 1: we awashed with jobs at the moment, because I seem
Speaker 1: just this tear of job freezes in the tech world.
Speaker 1: So in the tech world, I think, honestly, of the
Speaker 1: people who are being laid off will find another job
Speaker 1: very quickly. What is how opening, is that there are
Speaker 1: layoffs and there are a lot of job freezes at
Speaker 1: this point, even if and it's the holiday season, right
Speaker 1: the holiday season is a very very slow time for
Speaker 1: hiring all around the US. So what we have here
Speaker 1: is two things that are working against people. One is
Speaker 1: layoff and freezes. The second is the holiday season. But
Speaker 1: I think even if we look at once, we look
Speaker 1: at January or February, we're only really talking about the
Speaker 1: people receiving jobs again, because everyone isn't a software engineer
Speaker 1: that's being laid off. It is across the spectrum in HR, legal,
Speaker 1: finance operations, and so all of those jobs, even though
Speaker 1: they're intagg don't necessarily get picked up as quickly. I
Speaker 1: want to leverage your professional background, your experience. You've done
Speaker 1: a lot of reporting here at Bloomberg about what has
Speaker 1: happened at Twitter right down the road from me and
Speaker 1: Market Street people being locked out of the building, the
Speaker 1: HR department being let go, and so those administering the
Speaker 1: layoffs not being sort of qualified HR people. You know,
Speaker 1: Elon must tweeted over the weekend pictures of him working
Speaker 1: late into the night with this new team of engineers.
Speaker 1: But what is your assessment of how that process was handled?
Speaker 1: I want to be completely honest and transparent. This was
Speaker 1: probably the worst mass layoff I've ever seen in my
Speaker 1: twenty years of being an employment lawyer. I think, you know,
Speaker 1: Ellen came in as an individual versus a businessman and
Speaker 1: really look to take over a company and is using
Speaker 1: it like it's a toy versus a company. At this point.
Speaker 1: He did not come in and work with the chief
Speaker 1: people Officer, who is the chief people and Diversity officer,
Speaker 1: to determine the skills that he had within the company,
Speaker 1: the knowledge base he had within the company, so he
Speaker 1: could really make it born decisions about who to let
Speaker 1: go and who to stay. And everything is showing that
Speaker 1: he's let go of people who is he's asking to
Speaker 1: bring back at this point. I mean, there's so many
Speaker 1: things that he has done that have been really unfortunate
Speaker 1: and it's playing with people's lives, their salaries, their medical benefits,
Speaker 1: and their retirement benefits. I mean, this just kind of
Speaker 1: goes against everything that we say is in best practice
Speaker 1: of HR and it's really unfortunate. On the other hand, Aisha,
Speaker 1: he does have a track record of getting the best
Speaker 1: out of people, especially when they're under duress. Does the
Speaker 1: end justify the means? Absolutely not, Absolutely not. I I mean,
Speaker 1: and I would eat my words in six months to
Speaker 1: a year if something is different. But honestly, right now,
Speaker 1: he's working with a bare bones crew, a crew that
Speaker 1: doesn't appear to be diverse, a crew that is looking
Speaker 1: like they're going to burn out. And honestly, a number
Speaker 1: of people that I know who have continued with Twitter
Speaker 1: are looking and they're just looking for their next best opportunity.
Speaker 1: I think the landscape of employment has changed considerably since COVID.
Speaker 1: No one wants to work and work until they drop anymore.
Speaker 1: It is just not that type of employment landscape. And
Speaker 1: so I understand that Ellen has had people who stick
Speaker 1: along with him for this ride for a short duration,
Speaker 1: but I do not believe that he has created enough
Speaker 1: goodwill or that he has a good enough reputation even
Speaker 1: within Tesla, to bring people from Twitter who had really
Speaker 1: kind of dedicated their skills and everything to Twitter, to
Speaker 1: bring them alongside what he's trying to do. He's just
Speaker 1: not communicating enough. He's not really showing the roadmap to
Speaker 1: everyone and the things that he's done, from laying off
Speaker 1: people at the top all the way down with no severance,
Speaker 1: no notice. It's not a way to keep a company
Speaker 1: going or employing morale. It's interesting just to play devil's
Speaker 1: advocate here. You say, the landscape has changed, but the
Speaker 1: economic landscapes changing with it, And before we really had
Speaker 1: the pendulum swing in the direction of talent of employees. Well,
Speaker 1: now we've got to slow down in the economy and
Speaker 1: people are more fearful of their jobs. Is there a
Speaker 1: risk here that the focus on diversity, on inclusion, the
Speaker 1: realignment of what we thought our purpose for what it was,
Speaker 1: does shift again as we start to get more fearful.
Speaker 1: I don't think it it will shift. I think that
Speaker 1: some things will take a pause. I definitely believe that
Speaker 1: budgets within the d E and I space, the budgets
Speaker 1: within the culture space, are going to pause. I think
Speaker 1: they really are because in some companies they believe that
Speaker 1: that is nice to have versus a must have. But
Speaker 1: in terms of what we need, honestly, from a bare
Speaker 1: bones perspective to have a company run, which is top talent.
Speaker 1: Top talent can go anywhere, and the question is why
Speaker 1: would they want to work for you. Ellen at this
Speaker 1: point is not offering increased salaries, increase flexibility, nothing. He
Speaker 1: is saying, hey, please buy into this dream that I
Speaker 1: have of how I can really make Twitter something even
Speaker 1: better than it already was. And I don't know if
Speaker 1: he has a lot of people along for the ride.
Speaker 1: In terms of the other tech companies, there are some
Speaker 1: tech companies that have really done it right who are
Speaker 1: not abandoning d E and I and some of the
Speaker 1: other things like strife. I think that you don't abandon
Speaker 1: these principles, but sometimes you do need to take a
Speaker 1: pause budget terrant LYE in order to focus on operations. Okay,
Speaker 1: Aisha White Dixon White, Chief people Officer and legal adviser,
Speaker 1: Thank you now, bloom Bags Camera Leach is on the
Speaker 1: case with the Twitter saga and reported more layoffs today.
Speaker 1: Camp what do we learn? It's been a lot that's
Speaker 1: been happening over the past thirty six to forty eight
Speaker 1: hours for employees at Twitter. We could say even from
Speaker 1: our own reporting, starting off on Sunday, workers woke up
Speaker 1: to a to a to a new calendar invite Sunday morning,
Speaker 1: and then by midday Sunday there was all hands meeting
Speaker 1: affecting basically just trying to give a new direction for
Speaker 1: where Twitter was going to go. By the time it
Speaker 1: came around to Monday, workers had learned that they've been fired.
Speaker 1: They had been let go, which only until January that
Speaker 1: they'd get uh, they'll still be paid and considered to
Speaker 1: be an employee as well too. And more specifically, this
Speaker 1: affected the sales team, and this came as a complete shock,
Speaker 1: specifically because the sentiment was that you know, they had
Speaker 1: been and shield it from some of these layoffs that
Speaker 1: we have been reporting. Not only have our viewers been
Speaker 1: watching this, employees that Twitter have been watching our reporting
Speaker 1: as well too because they didn't know what was coming
Speaker 1: up next. But the whole thought process in the sentiment
Speaker 1: was that they wouldn't be affected by these layoffs because
Speaker 1: one thing that Twitter needed was revenue, and the cells
Speaker 1: team was the main driving force behind those things. So
Speaker 1: this came out a complete show for a lot of
Speaker 1: workers camera at the moment. I think at the bottom
Speaker 1: of the story, it really shows that at one point
Speaker 1: it was seven thousand workers before masks were now looking
Speaker 1: at an employee internal counter of two thousand, seven hundred
Speaker 1: and fifty. How much is that still to go? How
Speaker 1: much do we inherently need to support a overall social
Speaker 1: media and part such as Twitter. There's going to be
Speaker 1: real concerns. Hi, Yeah, I mean we've all been, you know,
Speaker 1: tracking a lot of these you know, technology companies, the
Speaker 1: big tech companies, and we know for sure that Twitter
Speaker 1: has been a revenue losing company for some time now,
Speaker 1: and they've just had to cut costs, you know. I
Speaker 1: think they only got down to a less than a
Speaker 1: billion just last year, and that was over they were
Speaker 1: losing about more than a billion dollars. So it's so
Speaker 1: much money they have to cut, and it seems like
Speaker 1: Ellen thinks that salary is the best way to do
Speaker 1: that by decreasing his head account. Um. I think the
Speaker 1: wheels are definitely spending over there. I think nobody knows
Speaker 1: where this roller coaster is headed next, and everybody's on
Speaker 1: their toes walking on the eggshells. Well, Kin, that's what
Speaker 1: I wanted to ask you about, you know, you and
Speaker 1: I and the team. We have heard from a lot
Speaker 1: of former and current employees right A lot of sources
Speaker 1: inside the company have been confused about what's going on.
Speaker 1: What is the sentiment among staff that are left at Twitter. Yeah,
Speaker 1: even for those that are left that Twitter, they as
Speaker 1: you know your guests in the last segment said they
Speaker 1: are still looking externally. They're keeping the the training wheels
Speaker 1: going um, because there is no direction There seems to
Speaker 1: be a lot of confusion going forward. Spoke to a
Speaker 1: source earlier today and apparently there should be a final
Speaker 1: all hands meeting happening today that kind of gives the
Speaker 1: direction where Twitter two point oh we'll be going. And
Speaker 1: apparently those are the just only the staff members that
Speaker 1: are left and that Ellen will be keeping with. But
Speaker 1: that was supposed to be the thought with the last
Speaker 1: all enhanced meetings, So you never know if this could
Speaker 1: be the next one, if this could be the final one. Um,
Speaker 1: so nobody knows. We're sticking close to the situation and
Speaker 1: we'll want tote it on Bloomberg dot com as well. Comer,
Speaker 1: thank you so much for bringing us your inside track
Speaker 1: in the moment, Cameron Leach, as always, we thank him
Speaker 1: and you ed across whether all your reporting coming up
Speaker 1: crypto contagion, it worsens Genesis wanting up the possible bankruptcy.
Speaker 1: More on that moment. This is Bloomberg, two major bloomberg
Speaker 1: scoops in the world of crypto. On Monday, Genesis has
Speaker 1: warned of a potential bankruptcy if it doesn't get funding,
Speaker 1: and federal prosecutors in Manhattan were already looking into fd
Speaker 1: x is operation months before it's collapse. That according to sources,
Speaker 1: Luckily Bloomberg Shnali Bassak is here with all the details.
Speaker 1: Let's start with that ft X investigation. What do we
Speaker 1: know about regulators and what they were doing with f
Speaker 1: t X. Regulators were concerned about the ft X empire.
Speaker 1: Of course, regulators in the United States would be worries
Speaker 1: about worried about the ft X empire. I would also say,
Speaker 1: they'll remember, this is all happening. The bloomberg scoopa that
Speaker 1: we are discussing here is all happening on the back
Speaker 1: of a lot of dispute here ed between the Bahamas
Speaker 1: and the United States and bringing Sam Bankman Freed here
Speaker 1: to questioning for regulators and lawmakers publicly as we wait
Speaker 1: to hear what's going to happen with the House Financial
Speaker 1: Services Committee and the Center Banking Committee, who also want
Speaker 1: to bring in Sam Bankman Freed for testimony as well
Speaker 1: as his deputies. I would say separately, as we think
Speaker 1: about what's happening with regulators tomorrow, there's going to be
Speaker 1: a hearing in a Delaware bankruptcy court starting eleven am.
Speaker 1: And so you're hearing both the issues of the f
Speaker 1: t X empire and ravel at the same time as
Speaker 1: we hear about authorities and their concerns. According to sources,
Speaker 1: between the links between f t X and al Amda,
Speaker 1: Let's of course go to further links. Let's go to
Speaker 1: further contagion. Let's go Shnali to genesis right now, because
Speaker 1: you're scooped just before us coming on. Add the fact
Speaker 1: that they may have to fail far off the bankruptcy.
Speaker 1: The focus right now is this is not imminent and
Speaker 1: they're looking for other sources of funds. Now. Remember something
Speaker 1: that's interesting about not just the breaking news that we
Speaker 1: have today as well as what we've had as we've
Speaker 1: been talking about U S authorities looking at f t
Speaker 1: X over months. This is just another indication that some
Speaker 1: of these issues go back many months, that they go
Speaker 1: back to Three Arrows for example, and whoever had a
Speaker 1: relationship with them. Remember, Genesis is one of those companies
Speaker 1: that did have links to both Three Arrows and f
Speaker 1: t X. At this point in time, they are a
Speaker 1: large creditor when you looked at their relationship to Three Arrows.
Speaker 1: And now let's talk about it in the vein of
Speaker 1: f t X for a second, because we know the
Speaker 1: trading desk had had about a hundred seventy five million
Speaker 1: dollars tied up with f t X, but the lending
Speaker 1: business separately has had to pause withdrawals. So here come
Speaker 1: the questions, what were the relationships then between Genesis Lending
Speaker 1: and Genesis Trading, Genesis Lending Trading and the rest of
Speaker 1: the Visual Currency Group empire. How much does that actually
Speaker 1: matter at the end of the day. And are some
Speaker 1: of these questions not just a matter of you know,
Speaker 1: customer money tied up in one exchange or one lender,
Speaker 1: but is there a broader systemic issue here in the
Speaker 1: way customer funds are being used among crypto companies? More
Speaker 1: largely as it comes to lending and trading activities. Okay,
Speaker 1: so one that we continue to ask questions on and
Speaker 1: of course cost no expersions, but continue to dig deep
Speaker 1: as you do with all the relative reading tentacles of
Speaker 1: this business. We thank you. Shanna m now going viral.
Speaker 1: Let's stick with FIFA. Let's stick with seven national football
Speaker 1: teams including England, who will not wear a rainbow Arman
Speaker 1: showing solidarity with LGBTQ plus rights, bowing instead de pressure
Speaker 1: from FIFA because players might receive a yellow card for
Speaker 1: the show of support. Cutter has been under intense scrutiny
Speaker 1: leading up to the World Cup, of course, over of
Speaker 1: course the treatment of migrant workers, as well as concerned
Speaker 1: with human rights and its criminalization of homosexuality. Now one
Speaker 1: gay rights group Stonewall says that by threatening sporting sanctions
Speaker 1: and stopping players from wearing the One Love Our Band's,
Speaker 1: FIFA are brushing criticism of human rights abuses under the
Speaker 1: carpet human rights campaign, and Peter Tatchell noted, look two
Speaker 1: days ago few for presidents spoke of inclusivity about this
Speaker 1: ruling shows actually his true colors. I urged the team
Speaker 1: captains at their post match process conferences to spend just
Speaker 1: thirty seconds to speak out for the rights of women,
Speaker 1: lgbt s and migrant workers. That would have a huge impact,
Speaker 1: he says for me. Also the Iranian team not singing
Speaker 1: their national anthem, and of course over the course of
Speaker 1: this weekend going viral that shocking news out of Colorado springs.
Speaker 1: It makes it a very intense time for the lgbt
Speaker 1: Q plus community, particularly in the US. Yeah, and we
Speaker 1: see on social media it's having an impact on the
Speaker 1: arm bands, you know, Captain saying that they thought that
Speaker 1: they would face a fine rather than something relating to
Speaker 1: kit rather than a sporting sanctioned serious things, That does it, Caroline.
Speaker 1: For this edition of Bloomberg Technology on Tuesday, though, we've
Speaker 1: got zoom CFO Kelly Steckelberg to discuss earnings and the
Speaker 1: growing competition in video conferencing. Don't forget check out our podcast.
Speaker 1: You can find it on the terminal as well as
Speaker 1: on Apple, Spotify and on iHeart. This is Bloomberg