Speaker 1: This is Bloomberg Business Week from Bloomberg Radio. Hi Jason
Speaker 1: Kelly and I'm Carol Masser. Welcome to the weekend edition
Speaker 1: of Bloomberg Business Week. This week we'll bring you some
Speaker 1: of the most important and informative coronavirus conversations we've had
Speaker 1: throughout the week on our daily radio show. And I
Speaker 1: was thinking, Jason, here we are week ten. When we
Speaker 1: began working from home, spring was just getting underway, and
Speaker 1: now here we are kind of the unofficial start to
Speaker 1: summer Memorial Day weekend. Yeah, it's really fascinating to think
Speaker 1: about and the whole notion of ten weeks of doing this.
Speaker 1: I mean, what was last week and last time, rather
Speaker 1: you did something for ten weeks you know, something really uh,
Speaker 1: supremely and radically different. Our world has changed, and that
Speaker 1: is for sure, right, And this week involved so many
Speaker 1: conversations over what is turning out to be one of
Speaker 1: the most difficult questions of our time. It's about reopening
Speaker 1: the economy. Do we do it too soon or too late?
Speaker 1: And what will be the call of either decision? That
Speaker 1: in fact is our cover story of the magazines double
Speaker 1: issue this week. We'll have more on that a little
Speaker 1: bit later on, well, and we heard from some really
Speaker 1: interesting people, some very familiar names, folks you've heard on
Speaker 1: our air before, and some new voices. Klaus Zelmer he's
Speaker 1: the president CEO of Porsche Cars North America. Also Ian Shreeger, Yeah,
Speaker 1: Ian traeger Man. When it comes to hospitality and innovation
Speaker 1: in hotels and really living overall, this is the guy.
Speaker 1: He has been at it for fifty years. So we
Speaker 1: caught up with him about the impact and really what
Speaker 1: everything is going to look like, especially for big cities, right,
Speaker 1: what it looks like. Later on, we also heard from
Speaker 1: Facebook's Cheryl Sandberg, author of Lean In, and we felt
Speaker 1: like we were leaning in to this notion of what's
Speaker 1: going to happen to small businesses that is one of
Speaker 1: the biggest questions facing the US economy. First up, though,
Speaker 1: we spoke with Dr Bill Hasletine. He is the chairman
Speaker 1: and president of Access Health International. Incredibly well known in
Speaker 1: the world of medicine. He has worked on some of
Speaker 1: the biggest medical questions of our time. Right, He's now
Speaker 1: got a nonprofit, but let's not forget he found in
Speaker 1: more than a dozen companies, including Human Genome Sciences. He
Speaker 1: reminds us that testing, tracing and strict isolation will be
Speaker 1: the only way we really beat the virus. I see
Speaker 1: it as a small step forward and a lot of hype. Interesting,
Speaker 1: tell us more, Yeah, explain why? Well, there are eight
Speaker 1: pages that they reported. The data is not public, we
Speaker 1: can evaluate it. We don't know what actually happened, and
Speaker 1: there are other reports of published papers by scientists around
Speaker 1: the world who have uh done thet least what they've
Speaker 1: done and perhaps more so. That's why I say it's
Speaker 1: a little bit of news and a lot of hype.
Speaker 1: And so when you look at that, is this just people, really,
Speaker 1: the market in particular, and maybe us just as human
Speaker 1: beings looking and grabbing onto to some sliver of hope
Speaker 1: here Dr hazeltine. You know, hope has been the handmaid
Speaker 1: of scoundrels for generations. It's what allows us to be conned.
Speaker 1: We need hope, but hope is also dangerous. We have
Speaker 1: to be careful with it. I'm not saying that that
Speaker 1: vaccine won't work. I'm just saying it's a very slender
Speaker 1: thread to move on the market. Well, having said, go ahead, no, no, no,
Speaker 1: well you know what, let me just because we want
Speaker 1: to continue this line of thought, we did. They catch up.
Speaker 1: Our Bloomberg News team on the TV side caught up
Speaker 1: at the Modernity CEO Stefan bontell Um and talked about
Speaker 1: Phase three the trial, specifically that they expect by July.
Speaker 1: Let's just listen to a snippet of that interview. We
Speaker 1: are finalizing the protocol for a Phase three, which is
Speaker 1: the last clinical study before Provolo, which we are hoping
Speaker 1: to stop in July of this year. Of the study
Speaker 1: will be several thousand, has the subjects across many contries.
Speaker 1: We are finalizing the post code as we speak with
Speaker 1: the v and we're hoping that people can start in July.
Speaker 1: As these all plans. So Phase three, as we know,
Speaker 1: and you certainly know, Dr Hazeltine is an important process.
Speaker 1: But but it reminds us that there's still a lot
Speaker 1: to be known, right, There's a lot to be known. No,
Speaker 1: as far as we know, there's been no real challenge
Speaker 1: and a human being. And I can say that I've
Speaker 1: been reviewing the literature of vaccine efforts over many years,
Speaker 1: first with Stars, then with MERSU and other coronaviruses. This
Speaker 1: is not a simple problem. Um. There are a number
Speaker 1: of different attempts that have been made, there are results
Speaker 1: that look at least as good as these results from
Speaker 1: two other laboratories. Uh, and so it's it's very premature.
Speaker 1: Doesn't mean it's not gonna work. I don't want to
Speaker 1: say that I have any information about whether it's at
Speaker 1: work or not. All I can say is the kinds
Speaker 1: of signals they're getting are expected at this stage. They
Speaker 1: don't necessarily mean that the vaccine will protect anybody, or
Speaker 1: if they do protect it, how long they will protect them.
Speaker 1: There's a lot of questions that remain to be done,
Speaker 1: and eight people is a far too small study, you know,
Speaker 1: whether it's even safe. So you know, I think making
Speaker 1: a big announcement that moves the market on a first
Speaker 1: in human study for a people is an extraordinary event
Speaker 1: in biomedical science. It just doesn't happen. Uh. The fact
Speaker 1: that this has happened puts I think we all understand
Speaker 1: why we're all desperate to see an end to this disease.
Speaker 1: We have friends, we have children and grandchildren were deeply
Speaker 1: worried about. UH. We're all upset about the economy and
Speaker 1: the way this has changed our lives, and we are
Speaker 1: hoping for an act, but hope is not the answer.
Speaker 1: Really hard data is the answer to what's what we
Speaker 1: need and we haven't seen that yet. And that's Dr
Speaker 1: Bill Hazeltine, Chairman, President of Access Health International, that historical perspective,
Speaker 1: but also hearkening back to our theme last week, Carol,
Speaker 1: a little bit of a reality check. We caught up
Speaker 1: with him, and it's important to note, you know, these
Speaker 1: were conversations that we taped throughout the week. We were
Speaker 1: talking to him on a day where the market was
Speaker 1: a bulliant over the Maderna vaccine results as very early results.
Speaker 1: And I liked what he said because it made us,
Speaker 1: I think, take a much more realistic view. And the
Speaker 1: week really pour that out well, and I love what
Speaker 1: he said, Hope is not the answer. We need real
Speaker 1: hard data. Ultimately, that is what we need to get
Speaker 1: ahead of this virus. All right, you're listening to Bloomberg
Speaker 1: Business Week coming up a conversation about small business with
Speaker 1: Facebook CEO Cheryl Sandberg and the survey that they have
Speaker 1: done that shows one third of small businesses they have
Speaker 1: stopped operating a bleak landscape. For sure. This is Bloomberg.
Speaker 1: This is Bloomberg Business Week with Carol Masser and Jason
Speaker 1: Kelly from Bloomberg Radio. Well, today we're bringing you some
Speaker 1: of the most important, we hope informative conversations we had
Speaker 1: on our daily Bloomberg Business Week radio show this week.
Speaker 1: We're talking about an economy reopening, but we're also talking
Speaker 1: about an economy Carol, that is totally and fundamentally and
Speaker 1: maybe permanently changed. Yeah, and nowhere do you see that
Speaker 1: more starkly than with small business. Facebook, in fact, had
Speaker 1: some news Jason this week about a recommitment to commerce
Speaker 1: with small business. They announced a new digital storefront, it's
Speaker 1: called Shops. They also released the results of a survey
Speaker 1: about the viruses impact on small business and for that, Jason,
Speaker 1: we caught up with Facebook CEO Cheryl Sandberg. We heard
Speaker 1: more about the survey results, and she brought along a
Speaker 1: small business owner, Seemi at Abajo, owner of Eco. They
Speaker 1: both joined us from the West coast. Survey is quite devastating,
Speaker 1: you know. We started working on this actually before coronavirus
Speaker 1: with a small business round people and we thought we'd
Speaker 1: put a survey out, you know, the state of small
Speaker 1: business and it would be very very positive. Right. Unemployment
Speaker 1: a historically low levels entrepreneurship thriving, and then coronavirus hit
Speaker 1: and the picture we got back was sobering. But I
Speaker 1: think even more important, more than a third of small
Speaker 1: businesses have stopped operating entirely expects to fail if things
Speaker 1: don't change within the next few months. And the stat
Speaker 1: that really hit me was more than half of small
Speaker 1: business owners don't think they're going to be able to
Speaker 1: rehire their employees. Absolutely. So, see me, you had this
Speaker 1: exact experience, so help us understand exactly what happened. I mean,
Speaker 1: your story has something of a happy ending, But that
Speaker 1: devastation that that Cheryl talked about, I mean you experienced
Speaker 1: it firsthand right off the bat. Um. Yeah, so I
Speaker 1: experienced the first time because one deful thing hit. I
Speaker 1: had to let both my whole team and shut down
Speaker 1: my business for the first three before we UM. And
Speaker 1: it's not of me, I guess all restaurant owners and
Speaker 1: small businesses in San Francisco, especially because of the overhead
Speaker 1: that comes with being a business in the city. Um,
Speaker 1: once you have one week, two weeks without customers or
Speaker 1: your usual stream of revenue, you are hemorrhaging funds. UM.
Speaker 1: And I saw very quickly. My restaurant is located in
Speaker 1: the so my neighborhood. UM. Once my business closed, I
Speaker 1: started to see all the other restaurants and corner stores
Speaker 1: around starting to take the same lead. UM. Fortunately for me,
Speaker 1: I connected to an organization that's a nonprofit that's feeding
Speaker 1: the homeless and the elderly and generally vulnerable populations in
Speaker 1: the city right now. So I was able to within
Speaker 1: the past two weeks rehire my cord team. UM. And
Speaker 1: you know, that's a positive story. But UM, that's not
Speaker 1: going to be the case for many small businesses UM
Speaker 1: who are just not gonna be able to rehire their
Speaker 1: course BA another issue, or maybe it's not an issue,
Speaker 1: but one main problem that small business owners are having
Speaker 1: getting their teams back lies within the fact that, UM,
Speaker 1: the employes are sometimes making more unemployment than they would
Speaker 1: be making coming to work, especially now which California is
Speaker 1: a different six dollar payment. UM, there's really no incentive
Speaker 1: for them to go back for work. So it's a
Speaker 1: tough time all around the small businesses right now. So, Cheryl,
Speaker 1: when you see the results of the Facebook survey, and
Speaker 1: we've been talking often a lot about you know, what
Speaker 1: needs to be done especially for small business We just
Speaker 1: came off a conversation you know about you know, our
Speaker 1: backbone is small businesses and it's going to be tough
Speaker 1: for them to resist going back. So what do you
Speaker 1: see as kind of the necessary components to protecting our
Speaker 1: small business community, making them safe so that they can
Speaker 1: come back safely when the environment changes. So look, you know,
Speaker 1: of it is bridging until we get there. So obviously
Speaker 1: the government loans matter. We put a hundred million dollars
Speaker 1: to work and just gramps small businesses all around the world.
Speaker 1: We hearmarked forty million of that for the United States
Speaker 1: and half of that for women, minority and veteran owned businesses.
Speaker 1: Because we all know that when crisis hits, the most
Speaker 1: vulnerable get hit the hardest, and so we all need
Speaker 1: to do everything we can to bridge. We're working on
Speaker 1: more products that helps small businesses go online if they
Speaker 1: weren't online before to the extent they can. They need
Speaker 1: to do more online. Were reaching customers online. We're providing
Speaker 1: services online and then once they come back to work,
Speaker 1: how do we do that safely? We see curb side checkouts,
Speaker 1: we see people doing art classes online. There's an amazing
Speaker 1: story of a bookstore that um located in University City, Missouri.
Speaker 1: They're called I See Me and they're really for black
Speaker 1: children to discover world models and learn about African American history.
Speaker 1: But it's very much community based thing where everyone went
Speaker 1: there in person. They're now doing those same storylines online.
Speaker 1: Local businesses are going to have to be able to
Speaker 1: morph to do more things online, and that's what we're seeing. So, Cheryl,
Speaker 1: I wonder what you make Especially given your background you
Speaker 1: worked at the Treasury Department. You understand the inner workings
Speaker 1: of government really well, the balance between the public and
Speaker 1: the private. What does the government need to do in
Speaker 1: the short and mid term to ensure that private efforts
Speaker 1: like the one that you just described can be successful
Speaker 1: in the long term. What do we need from the
Speaker 1: government at this point? Well, when you ask that question,
Speaker 1: I feel like it's really all hands on, Jack. When
Speaker 1: we need local government, state government, national government to be
Speaker 1: helping bridge for companies, which they are, but also helping
Speaker 1: us keep safe. You know, as we open up, how
Speaker 1: do we do it to protect everyone, make sure our
Speaker 1: hospitals don't don't get overrun, make sure that information is
Speaker 1: clear and flowing. I think you know We've been through
Speaker 1: a lot, but there is a lot at us and
Speaker 1: it has to again be everyone doing their part. And
Speaker 1: I do think about what's interesting is this is a time,
Speaker 1: as you know, I feel like the tech industry was
Speaker 1: largely on everyone's radar, a lot of scrutinyous happening. Do
Speaker 1: you see this time, you know, you talk about the
Speaker 1: things that you guys are doing to help bridge the
Speaker 1: gaps for small businesses? Is this a time to kind
Speaker 1: of potentially, you know, improve your image. You know, the
Speaker 1: government has been looking and and you politicians, I'm just
Speaker 1: curious how you see that. So we've been trying to
Speaker 1: do the right thing all along, and when we've made mistakes,
Speaker 1: were hard to correct them and prevent them next time.
Speaker 1: You know. Right now, we're just rolling up our sleeves
Speaker 1: and doing everything we can to help small businesses get
Speaker 1: through it. Roll up products that can help them, you know,
Speaker 1: things like fundraisers for small business. You know, we had
Speaker 1: fundraisers for nonprofits, we had fundraisers for you know, people,
Speaker 1: but we never would have rolled up fundraisers for small
Speaker 1: business until this crisis. We are just focused on putting
Speaker 1: our efforts to what can help and believe that we
Speaker 1: do the right thing, people will figure that out and
Speaker 1: believe that we are over time. That's Facebook CEO Cheryl
Speaker 1: Sandberg and small business owners see me at a bajo,
Speaker 1: owner of Eco talking really about small businesses, what's going
Speaker 1: on and what needs to happen to help them stay
Speaker 1: alive and come back. I have to say, you know,
Speaker 1: I was thinking back over that conversation, and I think
Speaker 1: you mentioned this later on in the week. You know,
Speaker 1: this notion that you know, Cheryl Sandberg, we talked with
Speaker 1: her about the personal effect. You know, she has been
Speaker 1: sheltered in place like so many people, and yet her
Speaker 1: fiance's family, part of her family, you know, frontline healthcare workers.
Speaker 1: So she has a sense, as many of us do,
Speaker 1: about what it's like beyond our you know, sort of
Speaker 1: cocted worlds that we are fortunate to live in, that
Speaker 1: there are people really fighting this every day. And certainly
Speaker 1: that goes back to small businesses who many in many
Speaker 1: cases if you're talking about restaurants and even some retailers,
Speaker 1: they're on the front lines as well. Yeah, no doubt
Speaker 1: about it. And by in line, she said in terms
Speaker 1: of small business is more than we're going to have
Speaker 1: to morph and go online to really survive. You're listening
Speaker 1: to Bloomberg this week. Coming up staying with tech, we
Speaker 1: hear about a new e commerce app that just launched
Speaker 1: this week, Gets Bold. Yeah, absolutely, coming into a rough environment.
Speaker 1: This is Bloomberg. This is Bloomberg Business Week with Carol
Speaker 1: Masser and Jason Kelly from Bloomberg Radio. We'll bring you
Speaker 1: some of the most important and informative conversations we had
Speaker 1: throughout the week on our daily radio show. And of
Speaker 1: course we have to remind everybody news was happening constantly
Speaker 1: crossing the Bloomberg So all of this happening in real
Speaker 1: time well, and a reminder Carol that business marches on
Speaker 1: and also in times of crisis and in times of disruption,
Speaker 1: some of the biggest ideas emerged. We caught up with
Speaker 1: Julie Bornstein. She launched her new e commerce eports called
Speaker 1: The Yes this week. They delayed it back in March.
Speaker 1: She has an incredible history in the world of retail
Speaker 1: and eco comer. She worked at Nordstrom. She was the
Speaker 1: CEO of stitch Fixed. Check it Out CS is a
Speaker 1: new shopping platform that makes shopping for women's fashion more
Speaker 1: fun easier and smarter than anything that exists today. So
Speaker 1: the idea is it's an app that is tuned to
Speaker 1: each user. You come onto the app and you fill
Speaker 1: out a profile that's a fun Q and A, and
Speaker 1: then you see brands and themes and styles that you
Speaker 1: like in your own home feed, and everybody's home feed
Speaker 1: is different, and you can search on anything that you're
Speaker 1: looking for. You can discover new brands. We always recommend
Speaker 1: what size you should get, and it's free shipping both ways,
Speaker 1: so to buy and to return. We're going to talk
Speaker 1: a little bit more about it, but I just curious
Speaker 1: about the launch. Did you think about holding off or
Speaker 1: did you feel like this was an ideal time because
Speaker 1: there are so many people home at this point. We
Speaker 1: actually did hold off, were originally planning to lodge in
Speaker 1: late March because of COVID hitting, we needed to step
Speaker 1: back and reevaluate, and then we kind of watched what happened.
Speaker 1: But we were noticing that obviously, UM with retail closing,
Speaker 1: a lot of our brands were losing sales that they
Speaker 1: would have gotten otherwise. And we have small brands and
Speaker 1: big brands UM and their cancel their orders were being
Speaker 1: canceled UM for the fall, and so we really felt
Speaker 1: like we wanted to step in and help. And the
Speaker 1: truth is people need a little levity in their life
Speaker 1: and it's a really fun app to play with. So
Speaker 1: we did decide to make a donation for every download
Speaker 1: to Good Plus Foundation to help families in need UM
Speaker 1: but we decided that this time was as good as
Speaker 1: any given how crazy the world has become. Our guest
Speaker 1: at this hour is Julie Bornstein. She is someone who
Speaker 1: understands the retail industry. Former chief operating officer of stitch Fists,
Speaker 1: former chief digital officer. It's a flora uh, and she
Speaker 1: just launched today her e commerce startup. It's called The
Speaker 1: Yes And you know, Julie, we were just getting into
Speaker 1: it and and it's tailor made experiences and you use
Speaker 1: sophistic sophisticated algorithms. How exactly does it work on the
Speaker 1: back end? What's happened is we've built um UH, an
Speaker 1: algorithm that really understands fashion deeply. So we built a
Speaker 1: very deep taxonomy to understand every dimension of fashion, which
Speaker 1: includes all the style elements and the price and the
Speaker 1: brand and the construction UM And so we've started to
Speaker 1: understand fashion in a way that we can train data
Speaker 1: models to understand. And then we spent time learning about
Speaker 1: customers and we ended up building a tool that is
Speaker 1: ultimately kind of what Spotify is to you for music
Speaker 1: and so UM, the consumer can come on, they answer
Speaker 1: some Q and A, and then they have a home
Speaker 1: feed that is really built around them. And the more
Speaker 1: that you yes and no items in the home feed
Speaker 1: and in your search results, then you tune the app
Speaker 1: to you. So it really creates this very great and
Speaker 1: very hyper personal experience. UM. And of course we need
Speaker 1: a very large assortment of brand so we have over
Speaker 1: a hundred and fifty of the best fashion brands, from
Speaker 1: very high end to jim Me to and Ralph Lauren
Speaker 1: to kind of great everyday brands like Levis and made Well,
Speaker 1: so you can shop high and low or however you like.
Speaker 1: So what's the biggest lesson? I mean, what what do
Speaker 1: you take from all of that experience that that Carol
Speaker 1: laid out about sort of the shopper and and especially
Speaker 1: synthesizing in uh, Julie, sort of what's going on now
Speaker 1: with our behavior and our sort of whole world's being
Speaker 1: upside down? How do you pun intended sort of stitch
Speaker 1: all that together, um into something new. It's a great question.
Speaker 1: This is something we've been working on for two years,
Speaker 1: primarily because, as we've all seen, as e commerce grows,
Speaker 1: the more product that's sold online, the more websites there are,
Speaker 1: the more overwhelming shopping because and I think now in
Speaker 1: you know, this moment in time when we can't go
Speaker 1: to stores yet, um, we are more reliant on shopping
Speaker 1: online than ever, and the experience for most users is
Speaker 1: very overwhelming, especially in a category like fashion that's so nuan.
Speaker 1: Then there's so many options, and so really our goal
Speaker 1: was how do we help each user kind of cut
Speaker 1: through the clutter and surface the relevant product for them,
Speaker 1: whether it's things they know and love, or it's new
Speaker 1: brands they may never have heard of. And that's Julie
Speaker 1: Born seen from the Yes. My only disappointment Carol is
Speaker 1: that they're only selling women's clothes right now. As we
Speaker 1: jatted with her about joked with her about like I
Speaker 1: need a new place to buy my T shirts and jeans. Yeah,
Speaker 1: exactly what I thought was great about this conversation. There
Speaker 1: was a lot of retail news this week. Overall, we
Speaker 1: heard from the retailers across the nation. What she said, Ultimately,
Speaker 1: she doesn't think brick and mortar is going to go away,
Speaker 1: but some stores will not make it. But she thinks
Speaker 1: ultimately e commerce is going to get better as a
Speaker 1: result of the virus. Well, and this whole notion that
Speaker 1: one of the things we love about going shopping is
Speaker 1: that sort of serendipity, that discover ability and if you
Speaker 1: can figure out from an artificial intelligence perspective, essentially how
Speaker 1: to teach a machine to surprise you, I feel like
Speaker 1: that's kind of cool. It is cool. You're listening to
Speaker 1: Bloomberg Business Week. Coming up, we catch up with the
Speaker 1: president and CEO Porsche Cars North America. Class Selmore back
Speaker 1: with us. He reminded us Jason of our time with
Speaker 1: him last fall. Remember when he brought porches first fully
Speaker 1: electric sports car to our offices, the Takon Man. That
Speaker 1: seems like a decade ago, it really does. It's a
Speaker 1: cool car and they're actually selling out of them. This
Speaker 1: is Bloomberg. This is Bloomberg Business Week with Carol Masser
Speaker 1: and Jason Kelly from Bloomberg Radio. Well, today we'll bring
Speaker 1: you some of our favorite conversations from our Bloomberg Business
Speaker 1: Week daily radio show from this week real time news
Speaker 1: obviously Carol and the theme certainly is reopening. It is reopening,
Speaker 1: and with that in mind, we caught up with Klaus Selmore,
Speaker 1: the presidency of Porsche Cars North America. He liked most
Speaker 1: of us and his team. It is his tenth week
Speaker 1: from working from home and yet most of their dealers
Speaker 1: are back in March. Beginning of March we had a
Speaker 1: big event of Media Island, which classic cars and lots
Speaker 1: of fun, and then there's crisis hit us. So I'm
Speaker 1: personally now in my tenth week working from home, with
Speaker 1: the whole of port Car's North America basically working from home.
Speaker 1: The good thing is that our dealers are now back
Speaker 1: opening up the operations that we are at of back
Speaker 1: to business throughout the country and the May retails actually
Speaker 1: look pretty promising in the first half of this month.
Speaker 1: But yes, we had to take, of course, also a
Speaker 1: big hit in April where more than our and half
Speaker 1: of our that's where actually closed for sales. Talk us
Speaker 1: a little bit more about mat May. You said, May
Speaker 1: is starting to look promising. What are you seeing in
Speaker 1: terms of what are you hearing about activity of people
Speaker 1: getting out there looking at cars, maybe even you know,
Speaker 1: signing on the data line to to place in order.
Speaker 1: I think we're seeing a new normal. I think we're
Speaker 1: seeing people that, of course digitally engage. They want us
Speaker 1: to respect their safety. They want us to sanitize their car.
Speaker 1: They want us to pick up their cards for service
Speaker 1: or repair and bring them back without ever touching them.
Speaker 1: They want us to deliver a new car that they
Speaker 1: have purchased online to their house, dropping the keys, and
Speaker 1: then doing a video explanation of how the car works.
Speaker 1: So I think it's it's two things. It's one that
Speaker 1: our dealers are back in business, but they have adapted
Speaker 1: to the new normal, which just involves a lot more
Speaker 1: digital business. And and how does it change the does
Speaker 1: it or does it change clauss the economics of that
Speaker 1: process mean, does it change the type of staff you hire,
Speaker 1: the amount of staff that you hire, the investments that
Speaker 1: a dealer has to make. Like walk us through the
Speaker 1: implications of that sort of changed process. Well, I think
Speaker 1: the short term effect is that it is more expensive
Speaker 1: from a cost point of view to conduct that type
Speaker 1: of business because you still have your fixed assets, you
Speaker 1: have your investment you have your depreciation that you have
Speaker 1: to handle in your balance sheet, so you know you
Speaker 1: can't drop that from one day to the other. And
Speaker 1: of course, um you know, there's a lot of work
Speaker 1: involved in keeping everything clean super clean, you know, cleaning
Speaker 1: cars every time, like for you know, service incidents every time,
Speaker 1: any anybody who touches them. You know, your your productivity
Speaker 1: of your space is limited because you have to keep
Speaker 1: social distancing, uh priority. So short term it's going to
Speaker 1: be higher costs. Longer term, if people really consider this
Speaker 1: being their preferred way of conducting business, then of course
Speaker 1: you you have to invest less. But Portia I can
Speaker 1: say that people actually like the personal interaction and the relationship,
Speaker 1: and I hope that stay is going forward. What's interesting
Speaker 1: is I do love how you guys literally have kind
Speaker 1: of tapped into what is going on where more people.
Speaker 1: Obviously you have to do social distancing, but more people
Speaker 1: are doing things either virtually or socially. Umline, you guys
Speaker 1: have a new app you put out on how individuals
Speaker 1: and consumers can track their purchase of a new Porsche.
Speaker 1: Tell us a bit about that and why you did it.
Speaker 1: Does it is it just kind of playing into what's
Speaker 1: going on in this world. I think it just fits
Speaker 1: into this new world because you know, you want to
Speaker 1: know what's going on out there. And you know, a
Speaker 1: purchase of a Porsche is more driven by your heart
Speaker 1: than by your brain, and so you know you want
Speaker 1: to be engaged with that car being built. And now
Speaker 1: we actually provide with this track, your dream app. We
Speaker 1: provide the possibility to see when the car is in production,
Speaker 1: when it leaves to our production site in Germany, when
Speaker 1: it's on the vessel. You can even see a picture
Speaker 1: on that app off the vessel where your car currently is,
Speaker 1: when it arrives in America and your port, and when
Speaker 1: it's stand in transition from the port to the dealership,
Speaker 1: and when it's ready to be picked up. So you
Speaker 1: can basically follow through the whole process of ordering the car,
Speaker 1: the car being produced, until it's actually in your own garage.
Speaker 1: And so Claus tell us about demand from a regional perspective,
Speaker 1: because you know, one of the things we know, and
Speaker 1: we're just talking to one of our colleagues down in
Speaker 1: your neck of the woods, it is, you know, the
Speaker 1: view is a little bit different in the southeast versus
Speaker 1: the northeast, versus the Midwest versus the West Coast. Help
Speaker 1: us understand you know how that has affected you know
Speaker 1: where you're selling and maybe where you're seeing sales a
Speaker 1: little slower. Um. Actually, of course, you know New York
Speaker 1: has been hit hard, and we can see that in
Speaker 1: our sales numbers. But if you we have four areas
Speaker 1: we subdivided the United States in which is Central, which
Speaker 1: is basically central, and North and then West, East and
Speaker 1: South pal has actually been prody stable, uh, and East
Speaker 1: has been hit the hardest, and then West and then Central,
Speaker 1: which is Central and North is not not such a
Speaker 1: strong area for us in terms of sales. So where
Speaker 1: April really hurt was on either side of this country.
Speaker 1: Let's get back to our conversation with Klaus Zelmer. He is,
Speaker 1: of course president and CEO of Porsche Cars North America,
Speaker 1: joining us on the phone from Atlanta, And as we
Speaker 1: discussed a little bit earlier, one of the ways we
Speaker 1: got to know Claus was with the introduction of the Tykon,
Speaker 1: both with a visit to our Blueberg headquarters, but also
Speaker 1: it was the subject of a Super Bowl advertisement that
Speaker 1: Claus talked to us about. So class give us a
Speaker 1: Tykon update. What's happening with the car, Well, the car
Speaker 1: is performingxtremely. Well, Yeah, bringing downside of it is that
Speaker 1: we will not be able to fulfill the demand that
Speaker 1: we can be still see in the market here in
Speaker 1: North America. So our supply will be short, um, which
Speaker 1: is of course missed opportunities, but it's better this way
Speaker 1: than the other way around. Yeah, So how short can
Speaker 1: you quantify that for us? Um? Well, you know that's
Speaker 1: really difficult. Our order bank kon it's about double the
Speaker 1: cars that we will be able to deliver to North
Speaker 1: America at this point of time. But of course, you know,
Speaker 1: you you can not always be sure about the orders
Speaker 1: reflecting the real demand, because some people put various orders,
Speaker 1: but various steal us because they want to increase their
Speaker 1: chances to then get the cars. But we certainly know
Speaker 1: that our demanding seats are supplied and we will be
Speaker 1: able to get from Germany this year. Hey, class, what
Speaker 1: do you make though of like supply chains? Are you
Speaker 1: guys rethinking any of that because of what's happened with
Speaker 1: the virus and also on a day when we heard
Speaker 1: from President Trump earlier about you know, whether it's the
Speaker 1: you know, medical equipment that's needed. You know, God forbid
Speaker 1: that we go through something like this in the future,
Speaker 1: that everything needs to be made, you know in America.
Speaker 1: I just wonder how you are looking at things and
Speaker 1: like I said, global supply chains right now, Yeah, I
Speaker 1: think of course, you know, everybody wants to be in
Speaker 1: If you sell in a country, you want to produce
Speaker 1: in that country. But it also has to financially makes sense.
Speaker 1: Porsche is such a small car company. If you if
Speaker 1: you take the US for example, our market share is
Speaker 1: zero point three percent. So if you take a thousand
Speaker 1: cards that are sold new at any point of time,
Speaker 1: three of those are Porsche. So we don't have the
Speaker 1: scale to have factories across the globe. We only have
Speaker 1: factories in Germany at this point of time. So we
Speaker 1: will have to live for the foreseeable future with the
Speaker 1: fact that we produce cars where it makes sense in
Speaker 1: terms of quality, assurance, our investment, and you know, getting
Speaker 1: our money back there and then shipping the cars over.
Speaker 1: As much as we would love to have a bigger
Speaker 1: scale and then produce in the United States as well,
Speaker 1: financially that's not viable. And so when you think about
Speaker 1: sort of the mega trends that are underneath all of this.
Speaker 1: Especially you know you've spoken with this before about you know,
Speaker 1: the the overall companies and the North American divisions, you know,
Speaker 1: pretty aggressive move towards electrification and sort of the the
Speaker 1: industry is certainly moving that way. What does this mean
Speaker 1: for that sort of overall plan. Does it slaw it down,
Speaker 1: does it accelerate it a little bit? How it or
Speaker 1: does it change it in any way? Well, I think
Speaker 1: the overall new car demand this year will of course
Speaker 1: be way below last year's the mat so it could
Speaker 1: be anything between fifteen possibly thirty less new cars solved
Speaker 1: this year. Now, if you take the gas price at
Speaker 1: the moment, and some people actually buy an electric car
Speaker 1: because the electricity is cheaper than the equivalent you need
Speaker 1: to invest in gas to run your car, that's you
Speaker 1: take that away. So battery electric vehicle as a whole
Speaker 1: are not really being pushed the way that we would
Speaker 1: like to see them, awarding than the investments that have
Speaker 1: been made by the industry. But I see that something
Speaker 1: that is a short a short term effect. We hopefully
Speaker 1: get back to the normal situation with gas for isis
Speaker 1: uh and of course with cars that technologically advanced and
Speaker 1: the demand for that in the second half of the year.
Speaker 1: Are you rethinking your electrification plan at all? No, you can't,
Speaker 1: because we make odd decisions. You know, with any car
Speaker 1: that you launched this year, the decision has been made
Speaker 1: five years ago. UM. And that's the same for any
Speaker 1: car manufacture. Developing a car from scratch is a foard
Speaker 1: to five year cycle that you will have to calculate
Speaker 1: in So anything that happens right now is happening because
Speaker 1: we made those decisions forward to five years ago. That's
Speaker 1: class Zelmer the presidency of Porsche Cars North America. And
Speaker 1: you know what's interesting is, like the rest of us, UM,
Speaker 1: they are adapting. His dealers, he talked about adapting to
Speaker 1: more with consumers and Porsche owners online. He says it's
Speaker 1: more expensive, and Jason, you know, they're gonna have to
Speaker 1: wait and see if that continues longer term and whether
Speaker 1: they're going to have to make a big shift. Well,
Speaker 1: and it's also impacted their ability to make and deliver cars.
Speaker 1: But they've got a backlogs, which in normal times is
Speaker 1: good news. And he's happy about the fact that demand
Speaker 1: is there for that ticon that we have had an
Speaker 1: experience with at least sitting in it. We've never been
Speaker 1: able to He's never given us one to drive around.
Speaker 1: So maybe on the other side of this pandemic, we'll
Speaker 1: get to take it for a test drip. And that
Speaker 1: wraps up the first hour of the weekend edition of
Speaker 1: Bloomberg Business Week from Bloomberg Radio. I'm Jason Kelly and
Speaker 1: I'm Carol mass Or. Planning coming up in our next hour,
Speaker 1: including when you want to know about the hospitality industry,
Speaker 1: You've gotta check in with Ian Schrager. Plus we take
Speaker 1: you inside the magazine's cover story. It's provocative and asked
Speaker 1: the question are we gambling on a resurrection? Right? And
Speaker 1: looks at maybe another way of coming back. This is Bloomberg.
Speaker 1: This is Bloomberg Business Week with Carol Masser and Jason
Speaker 1: Kelly from Bloomberg Radio. Hello, I'm Carol Masser and I'm
Speaker 1: Jason Kelly. Today we're bringing you some of our favorite
Speaker 1: conversations we had during the week on our daily Bloomberg
Speaker 1: Business Week Radio show, Carol. Week ten, we're still obviously
Speaker 1: enveloped in all senses physically, economically by the impact of
Speaker 1: this virus, but we're starting to think about the way forward,
Speaker 1: and it is complicated. Jason, I'm just gonna say, get
Speaker 1: ready everybody for some thoughtful and very thought provoking conversations,
Speaker 1: including one with Tom Siebel. He's a founder and CEO
Speaker 1: at C three dot Ai. Tom is just one of
Speaker 1: those thinkers that you want to sit down and talk
Speaker 1: to for hours. That's exactly right. And someone we were
Speaker 1: also very excited to catch up with was Ian Schrager.
Speaker 1: He visited with us about a year ago. My how
Speaker 1: the world has changed. Well, And I'm just gonna say, everybody,
Speaker 1: get ready to learn about hustle and float. You may
Speaker 1: never work the same again. We're gonna catch up with
Speaker 1: ra Half Harfush. She has a new book at and
Speaker 1: a concept about productivity and really how to work smarter.
Speaker 1: This one definitely stuck in my brain. You and I've
Speaker 1: been quoting this back to each other ever since we
Speaker 1: had that conversation. But first up, we take you inside
Speaker 1: the magazine. The cover story. It's by economics editor Peter Coy.
Speaker 1: It's got a provocative title. The headline alone, Trump is
Speaker 1: gambling on a resurrection with lives and livelihoods. He also
Speaker 1: presents an alternative way forward. We spoke with Peter and
Speaker 1: magazine editor Joe Weber. So Peter and I have been
Speaker 1: sure of having ongoing conversations um about obviously the biggest
Speaker 1: story in the world right now, which is not only
Speaker 1: the virus, which I think he's done an amazing job covering,
Speaker 1: but um, the economy, which is the other thing that
Speaker 1: he covers really well. And I basically sort of asked
Speaker 1: him to say, like, Okay, what's our what's our take,
Speaker 1: what's this gonna mean going forward? And and the you know,
Speaker 1: the outlook, um is the thing that as business leaders,
Speaker 1: I think everyone's wrestling with, like what what's this thing
Speaker 1: gonna look like going forward? And so when we started
Speaker 1: talking about that, UM, I said, you know, I think
Speaker 1: one of the things that we have to bring in
Speaker 1: here is a conversation about resident in Trump and and
Speaker 1: sort of this mismanagement of the virus from the outset
Speaker 1: and also now almost the mismanagement of perhaps reopening too
Speaker 1: soon and if if that goes um you know, uh not,
Speaker 1: well that's going to have a serious impact on the economy.
Speaker 1: It's also a gamble for his re election campaign. And
Speaker 1: when I when we started talking about that, Peter goes, well,
Speaker 1: there's this thing called gambling on a resurrection you should
Speaker 1: know about, and I'll use that as a way to
Speaker 1: transition to Peter. Peter, what's gambling on a resurrection? Right?
Speaker 1: Term from game theory. So the idea would be, if
Speaker 1: you're behind in a game, it could be any game.
Speaker 1: It could be uh football game or running for election
Speaker 1: or a laboratory experiment, then you, uh, if you just
Speaker 1: play by conservative normal rules, you'll probably lose. Whereas if
Speaker 1: you gamble, take a big chance, there's some chance that
Speaker 1: it will pay off and you'll be very happy. And
Speaker 1: if it doesn't pay off, well, you're gonna lose anyway,
Speaker 1: So no big deal. Um. And so a lot of
Speaker 1: you'll see that a lot of executives who are losing
Speaker 1: money and wanted trying to keep their jobs will gamble
Speaker 1: for resurrection, and up to the shareholders to discipline them
Speaker 1: and make sure they don't, you know, gamble too much
Speaker 1: in a way that ends up harming the company. So
Speaker 1: I said, well, we can carry that analysis over to
Speaker 1: the United States the federal government. Trump is taking a
Speaker 1: fairly big risk that this reopening will will work, that
Speaker 1: there will be relatively few extra deaths and the economy
Speaker 1: will rebound and then he can win reelection. That's good
Speaker 1: for him. It's also good for the country if if
Speaker 1: it actually works out that way. But let me just
Speaker 1: finish on the downside quickly. The downside scenario is that
Speaker 1: he um loses, which he probably might have done anyway,
Speaker 1: but the country loses more than it would have under
Speaker 1: a conservative approach, as they're more deaths and the economy
Speaker 1: does not reopen quickly because you're getting resurgences and re
Speaker 1: shutdowns and people are afraid to stay at home. Exactly like,
Speaker 1: it gets to this whole idea, you know, by postponing,
Speaker 1: do you improve or reduce the impact by delaying the
Speaker 1: open I feel like it's the big question that everybody
Speaker 1: is debating. The problem is, this isn't a game. This
Speaker 1: is you're dealing with people's lives and livelihoods. So I
Speaker 1: do wonder, you know, kind of how you see it,
Speaker 1: what's the alternative way of kind of approaching this versus
Speaker 1: maybe what we're getting from President Trump, Well, what we're
Speaker 1: hearing from a lot of epidemiologists is that you need
Speaker 1: to have UM, you need to move gradually open the
Speaker 1: things that are most critical and where the risk of
Speaker 1: new outbreaks the smallest, and then keep shut the things
Speaker 1: that where they're the upside of reopening is relatively small
Speaker 1: and the risk is great. For example, we've heard Trump
Speaker 1: recently thinking can't wait to see, you know, stadiums, sports
Speaker 1: stadiums filling up again, And I'm thinking, really, that's exactly
Speaker 1: the last thing you should want to open, just because
Speaker 1: there's so much exposure. Once one person asymptomatic person carrying
Speaker 1: the virus could expose dozens or hundreds of people in
Speaker 1: a single afternoon watching a football game or something. And
Speaker 1: that's Economics editor Peter Coy, and of course Bloomberg Business
Speaker 1: Week editor Joel Weber. This is a big one in
Speaker 1: many ways. And Peter Coy, he's incredibly prolific. He also
Speaker 1: every now and again goes hard. Yeah. Absolutely, And I
Speaker 1: do feel like Jason, it's the question debate of our time,
Speaker 1: reopening the U S economy too soon? One are the
Speaker 1: health risks too late? Then? What cost to the economy
Speaker 1: and the livelihood of Americans. Peter really devels into maybe
Speaker 1: a better way of doing it. All right, you're listening
Speaker 1: to Bloomberg Busines Week coming up, Tom Siebel, another very
Speaker 1: thoughtful guy. He's the founder and CEO of C three
Speaker 1: dot AI, of Worse as well as his namesake eponymous
Speaker 1: company that was so famous really set the standard in
Speaker 1: many ways in the software business in Silicon Valley. He's
Speaker 1: got a new project and it is fascinating, right. It's
Speaker 1: all about COVID nineteen data collection and sharing that with
Speaker 1: the world to help end the pandemic. This is Bloomberg.
Speaker 1: This is Bloomberg Business Week with Carol Masser and Jason
Speaker 1: Kelly from Bloomberg Radio. We're bring us some of the
Speaker 1: most important and informative conversations we had throughout the week
Speaker 1: on our daily radio show. There were so many of them.
Speaker 1: These are just some of our favorites. And just to reminder,
Speaker 1: everybody was happening in real time as the news continued
Speaker 1: to evolve around us, and we got to catch up
Speaker 1: with Tom Cebell Carroll. I really enjoyed talking to him.
Speaker 1: So thoughtful. He's the CEO now of C three dot AI.
Speaker 1: He's the author of a book that we had talked
Speaker 1: about when it came out, Digital Transformation, Survive and Thrive
Speaker 1: in an Era of Mass Extinct And also, of course
Speaker 1: you know by the name the founder of Civil Systems,
Speaker 1: one of the best known and most influential companies in
Speaker 1: the history of Silicon Valley. But he's got a new
Speaker 1: company and this whole concept of a data lake. It's fascinating.
Speaker 1: In northern California, I would say that we've been there's
Speaker 1: really been very little impact from COVID In the county
Speaker 1: that I'm in, San Mateo County. There are this would
Speaker 1: be everything right in north of Polo Alto and Silicon Valley.
Speaker 1: We have three quarters of a million people, there's a population,
Speaker 1: there are seventeen hundred hospital beds, and on any given
Speaker 1: day there might be fifty people hospitalized with COVID. If
Speaker 1: they look at Santa Clara County, which is the county
Speaker 1: immediately south of US where there's roughly two million people,
Speaker 1: that would be everything from Polo Alto to San Jose
Speaker 1: there's about two million people, four thousand hospital beds. On
Speaker 1: any given day, there'll be a hundred and fifty people
Speaker 1: hospitalized for COVID. In San Mateo County. I believe there
Speaker 1: are no people on it. Later's most people in the
Speaker 1: town that I live in, Woodside, there have been ten
Speaker 1: people diagnosed with COVID, so it kind of missed us. Well.
Speaker 1: I mean, there's an argument meant to be made, I think, Tom,
Speaker 1: and I'm guessing some of your local lawmakers would make it,
Speaker 1: which is you guys did the right thing. I mean
Speaker 1: you sort of shut it down pretty early in the
Speaker 1: entire Bay area, right, We did shut it down early,
Speaker 1: and it kind of you know, I think the purpose
Speaker 1: for shutting it down was to keep from overwhelming the
Speaker 1: hospital systems, and we never got close to that. I mean,
Speaker 1: out of seventeen hundred hospital deads on an e given day,
Speaker 1: fifty might be occupied with in this county, fifty might
Speaker 1: be occupied with COVID patients. So it you know, maybe
Speaker 1: it worked. I'm you know, there's lots of different opinions
Speaker 1: on this, but it kind of never happened here. Yeah. Interesting. Interesting.
Speaker 1: Well let's hope it stays that way. Yeah, exactly. Um,
Speaker 1: lesson learned, you know, in terms of a playbook for
Speaker 1: for how to do it. Are you guys in the
Speaker 1: studio or are you doing this from Paul, We're doing
Speaker 1: it from home. We're from you guys are a professional operation.
Speaker 1: It's seamless professionalists of congratulations. Well, thank thank you. Yeah,
Speaker 1: we well, we've gotten good at it. We're at the
Speaker 1: end of our ninth week doing this from home, so
Speaker 1: I mean kudos to our team who got us all
Speaker 1: set up. But it is sort of it's an amazing
Speaker 1: tribute to technology, Tom, which you know far more about
Speaker 1: than we do. So let's talk about how technology is
Speaker 1: maybe helping us get our arms around this. We were
Speaker 1: talking with you earlier in the year about cyber attacks.
Speaker 1: We've got a different sort of attack on our hands now, uh,
Speaker 1: And I do wonder how technology and this whole concept
Speaker 1: of a data lake help us understand how that's being
Speaker 1: used here. You know, you recall that one of the
Speaker 1: things we spoke of when I was with you last
Speaker 1: in New York was the area of precision medicine. Okay,
Speaker 1: and precision medicine, unquably will be one of the largest
Speaker 1: commercial and industrial applications of artificial intelligence. So we can
Speaker 1: use this for a disease prediction, adverse drug reaction, genome
Speaker 1: specific medical protocols, AI assisted diagnosis. So this is the
Speaker 1: largest and most rapidly growing segment of the U S
Speaker 1: economy and many economies, and AI is going to impact
Speaker 1: medicine in a huge way. Now enter COVID. So this
Speaker 1: is a really unique opportunity UH to apply AI to
Speaker 1: contribute to this dialogue. And we looked at all the
Speaker 1: you know, everybody has just been guessing. And you know,
Speaker 1: as you change from you to one TV channel to another,
Speaker 1: and you listen to Neil Ferguson at King's College or
Speaker 1: the person at Stanford, and one person says the morbidity
Speaker 1: rate is going to be between two percent and five percent,
Speaker 1: and another expert with the same level of expertise says,
Speaker 1: the more ability rate is going to be going to
Speaker 1: be like, you know, one one thousand, one percent. What
Speaker 1: is a policymaker to do. Well, what we did is
Speaker 1: we formed a coalition that we call the C three
Speaker 1: AI Digital Transformation Institute, and we founded this with Microsoft.
Speaker 1: We funded this to a tune of about four hundred
Speaker 1: million dollars, and we aggregated the human capital at m
Speaker 1: I T. Carnegie, Mellon Princeton, the University of Chicago, the
Speaker 1: University of Illinois, and UM and UC Berkeley to engage
Speaker 1: in large scale research on applying AI to mitigate COVID pandemic.
Speaker 1: And so this is AI and machine learning models to
Speaker 1: mitigate disease, bioinformatics, modeling and simulation of propagations. So that's
Speaker 1: a that's a major initiative. It's underway. It's really exciting
Speaker 1: and that is one of the efforts that we've been
Speaker 1: engaged to. Tom. You really laid out what data like
Speaker 1: is all about. What's your goal? So this is you know,
Speaker 1: COVID nineteen data collection. What are you hoping that it
Speaker 1: does or what do you expected to do? And what's
Speaker 1: a time timeline on it. Well, in order to perform
Speaker 1: data science, in order to get accurate predictions, whether it
Speaker 1: be course of disease or the efficacy of social mitigations,
Speaker 1: these scientes need data. So what we have done in
Speaker 1: the past month is we have taken the twenty two
Speaker 1: largest data sources that are available in the world about
Speaker 1: COVID from Johns Hopkins and coord nineteen and the New
Speaker 1: York Times, in the Milligan Institute and what have you.
Speaker 1: These are ct scans, these are mortality data, core morbidity
Speaker 1: coursive disease, and we have aggregated those data into a unified,
Speaker 1: federated image that we've made available. This is called the
Speaker 1: C three AI COVID nineteen Data Lake and we've made
Speaker 1: this resource available to the world at no cost to
Speaker 1: be able to do research, and we've we've had so
Speaker 1: this is by far the world's largest copus UH corpus
Speaker 1: of COVID data available researchers. This is being powered by
Speaker 1: our friends at AWS who provided the the cloud platform
Speaker 1: to do it. And I think this will be an
Speaker 1: enormously important resource for people to research, to do research,
Speaker 1: understand the course of the disease and control the this
Speaker 1: epidemic and other epidemics like it. And that's Tom People's
Speaker 1: CEO of C three dot AI. I gotta tell you, Carol,
Speaker 1: this is one of those conversations that stuck with me.
Speaker 1: Part of it is tone, part of it is substance.
Speaker 1: And you know, this was a guy that we clearly
Speaker 1: sort of caught it a moment where he's been thinking
Speaker 1: big thoughts. Well, when we've had so much nationalism going on,
Speaker 1: populism going on, he is saying, this has got to
Speaker 1: be a global effort, and you know it's all about
Speaker 1: large social research. None of this in terms of attacking
Speaker 1: the virus can be done in a vacuum. And he
Speaker 1: reminded us, and he's not only reminding us he's actually
Speaker 1: making an effort to share all of the data so
Speaker 1: everybody can be working on a solution to COVID nineteen.
Speaker 1: And that, of course was just a part of the
Speaker 1: conversation that we had with Tom Siebel. For the full interview,
Speaker 1: be sure to check out our Business Week Extra podcast.
Speaker 1: You're listening to Bloomberg business Week. Coming up entrepreneur, hotelier
Speaker 1: and real estate developer Ian Schrager. He's a legend. This
Speaker 1: is bloombergs is Bloomberg business Week with Carol Masser and
Speaker 1: Jason Kelly from Bloomberg Radio. Well, today we're bringing you
Speaker 1: some of our favorite conversations from the week on our
Speaker 1: Bloomberg business Week daily radio show. Check that out two
Speaker 1: pm Wall Street every day. And Carol, this week it's
Speaker 1: about the road back. Well, it is about the roadback.
Speaker 1: And I have to say a story across the Bloomberg
Speaker 1: about a hotel in Times Square, New York times where
Speaker 1: which we know the city is shut down while this
Speaker 1: hotel is shutting down, and it brought us back to
Speaker 1: Ian Schrager, who has come to our studio several times.
Speaker 1: He's an entrepreneur, hotelier and real estate developer. So I
Speaker 1: really wanted to get his perspective, someone who has seen
Speaker 1: so many different cycles in the city, wanted to get
Speaker 1: his perspective on where we are and what life looks
Speaker 1: like after the virus. The hotel's uh the hotel businesses
Speaker 1: on the Siege Public has closed, as well as a
Speaker 1: lot of the additions, but I look forward to them
Speaker 1: opening soon. I feel that, uh, we've seemed light at
Speaker 1: the end of the tunnel and will be Uh There'll
Speaker 1: be a lot of uncertainty involved, but I'm quite confident
Speaker 1: that uh, you know, we will return to ther own business.
Speaker 1: We'll get back and uh we'll see APPI games again. Well,
Speaker 1: and Ian, you know, one of the reasons we wanted
Speaker 1: to make sure to talk to you beyond just your
Speaker 1: general wisdom and expertise, is but because you guys had
Speaker 1: to make the tough decision to close the Time Square
Speaker 1: edition about a year ago, give or take. You were
Speaker 1: with us talking about it opening a lot of promise
Speaker 1: there and Times Square you know, in a totally different
Speaker 1: uh place than it was when you opened it decades before. Now,
Speaker 1: obviously the city has been brought to a standstill. Help
Speaker 1: us understand what led ultimately to that decision. Well, unfortunately
Speaker 1: we had to end into a dispute between the owner
Speaker 1: of the property and it's financial institutions. The hotel is
Speaker 1: part of a larger component with a lot of retail,
Speaker 1: a big signage component as well as um um lots
Speaker 1: of office space to just do have nothing to do
Speaker 1: with us. We hope it'll get resolved. The hotel was
Speaker 1: doing better than we expected. Huge world Wide to call
Speaker 1: a claim and we're okay. We did close it for
Speaker 1: the pandemic and we're hoping uh to welcome everybody back
Speaker 1: so that the pandemic is over under control. So it's
Speaker 1: not a case though than e enough, because I know
Speaker 1: there's been some thoughts about I think there was another
Speaker 1: hotel that closed in the area that you know, problems
Speaker 1: for Times Square, especially in a post virus our post
Speaker 1: COVID nineteen world. Do you see it that way or no, No,
Speaker 1: I don't see it that way. You know, I've been
Speaker 1: hearing the pundits everybody talking about a paradigm shift, and
Speaker 1: you know, you know my experience, and I think since
Speaker 1: Biblical times, you never see a paradigm shift. Life finds
Speaker 1: a way, they make adjustments, they hold on. Nothing changed
Speaker 1: yet to nine eleven. Nothing changed at the World War
Speaker 1: two and so on and so forth. We always find
Speaker 1: a way and we get back to normal, and we
Speaker 1: at the supper, all these predictions from all the intellectual people.
Speaker 1: I I think so I I see things. Look, it's
Speaker 1: gonna take a while, We're gonna have to make an adjustment.
Speaker 1: We hopefully have to get a vaccine. But we'll be
Speaker 1: older the way we've dealt with every other cloudy in
Speaker 1: the history of the humanity. And it will return to
Speaker 1: normal when New York is still in New York and
Speaker 1: Times Square is still Times Square and uh, just a
Speaker 1: question of writing it out and being proved, uh and
Speaker 1: making adequate plans and uh and waiting for it to happen.
Speaker 1: And I don't see it being a long term ramp
Speaker 1: up back the business. I see it being you know,
Speaker 1: I can't tell for sure, obviously, but I think it's
Speaker 1: looking in terms of months. I think the bars in
Speaker 1: the restaurants will get started soon. Uh. There was a
Speaker 1: pent up demand because you know, the pandemic ends of
Speaker 1: the people before and at a different date than when
Speaker 1: the pandemic ends scientifically, and the people are aware and
Speaker 1: to go and you can see that when the bars
Speaker 1: opened up, and with times there and in other places
Speaker 1: they're they're packed. So you know, I'm I'm not an
Speaker 1: optimist by nature. I'm a realist and I I see this.
Speaker 1: Uh you no attorney to normal, Jackie when I can't say, but, um,
Speaker 1: you know, I think things will go back to normal.
Speaker 1: That's Ian Schraeger and Jason. We know he's been building hotels,
Speaker 1: he's been changing the model for over five decades. He's
Speaker 1: now building residential buildings. It was so good to get
Speaker 1: his perspective on how things change and how we come back.
Speaker 1: He really understands crisis and rebuilding well. And he understands
Speaker 1: New York. He understands city, and I dare say he
Speaker 1: understands human beings. I mean, this is a guy who
Speaker 1: was one of the creators of Studio fifty four. In
Speaker 1: many ways, he also redefined the way we think about hotels.
Speaker 1: And let me tell you, we got to think about
Speaker 1: hotels and travel and even just being human in a
Speaker 1: whole different way. Now you had me at Studio fifty four. Man,
Speaker 1: that was a great human experiment. I'm just gonna put
Speaker 1: that out there. It absolutely was. You're listening to Bloomberg.
Speaker 1: This week. Coming up, we hear from the author of
Speaker 1: a new book. We've been quoting this back and forth
Speaker 1: to each other all week, Hustle and Float Reclaim your
Speaker 1: Creativity and Thrive in a World Obsessed with Work. I
Speaker 1: love it. It's a reminder that, like Michael Jordan's, we
Speaker 1: all need an offseason. This is Bloomberg. This is Bloomberg
Speaker 1: Business Week with Carol Masser and Jason Kelly from Bloomberg Radio.
Speaker 1: So we're bringing you some of the most important and
Speaker 1: informative conversations, those that really stuck with us throughout the week.
Speaker 1: They happened on our daily radio show, and of course
Speaker 1: all related back to the virus. Jason. Well, and it's
Speaker 1: a reminder that this has changed us as human beings.
Speaker 1: It's changed the way we relate to each other, it's
Speaker 1: changed the way we relate to our work. It's been
Speaker 1: a time of deep reflection for many. So a timely
Speaker 1: new book. It's by rahaf Har Food. She's a digital anthropologist,
Speaker 1: a professor. Her new book is called Hustle and Float,
Speaker 1: Reclaim your Creativity and Thrive in a world obsessed with work.
Speaker 1: In order for you to have the perfect whitewater rafting trip.
Speaker 1: You have to have the right amount and the equal
Speaker 1: balance between the hustle when you paddle as hard as
Speaker 1: you can and the float where you lift your paddle
Speaker 1: up and let the river do the work. And if
Speaker 1: you do a trip with too much hustle, you'll get tired, exhausted,
Speaker 1: make mistakes for yourself in danger, And if you don't
Speaker 1: have enough hustle and too much float, you'll end up
Speaker 1: aimlessly going where the river takes you and not where
Speaker 1: you want to go. And that really stuck with me
Speaker 1: as a professional creative and knowledge worker, because I think
Speaker 1: there's a lot that we can learn in terms of
Speaker 1: how we approach our own work and our own creative tasks.
Speaker 1: So much hustle, I mean, is it is so true? Um?
Speaker 1: We all see it. We see it in each other.
Speaker 1: We see it in our partners and our families, and
Speaker 1: and in our colleagues especially, you know, especially working in
Speaker 1: big cities, and and we definitely want to discuss of
Speaker 1: where we are in this you know, upside down world.
Speaker 1: But but I do want to ask you how did
Speaker 1: we get to this point in your estimation where we
Speaker 1: just eyes productivity so far above everything else the book
Speaker 1: took about three years to research, so I'm gonna try
Speaker 1: to summarize that and maybe you know fifteen to don't
Speaker 1: the seconds tore you, but perfectly created this very complicated
Speaker 1: story where we took the powerful first of all our
Speaker 1: powerful history. So think about the Puritan work ethics, think
Speaker 1: about the Industrial Revolution, and then think about the American dream,
Speaker 1: which is like one of the most powerful ideologies that
Speaker 1: I've been exported all over the world, this idea that
Speaker 1: if you work hard enough, you will be successful. And
Speaker 1: what's happened is that over time all of these ideas
Speaker 1: have kind of merged together, where now we have started
Speaker 1: to associate our identities are self worth, our contributions to
Speaker 1: society through this productive lens. And then we think, oh, well,
Speaker 1: if I'm successful, it's because I'm really busy, or if
Speaker 1: I'm successful, it's because I'm really productive. And what we
Speaker 1: don't say is if I don't feel like I'm productive enough,
Speaker 1: it must be because I'm not working hard enough. So,
Speaker 1: in essence, we've created a story that's supported by the
Speaker 1: media by how we talk about successful people, by how
Speaker 1: hard they work, by what time they wake up in
Speaker 1: the morning, by how late they stay at the office.
Speaker 1: We've sort of created this idea that whatever we're doing
Speaker 1: is never quite enough, and if we want to reach
Speaker 1: that next pinnacle of success, the answer is obviously more hours,
Speaker 1: more time, more hustle. When the science actually says the
Speaker 1: office that the science says, it's you want to do more,
Speaker 1: you actually have to work less. But that's a message
Speaker 1: that's so hard for people to absorb when we're being
Speaker 1: told the opposite through social media and then the books
Speaker 1: that we read and the people that we hold up
Speaker 1: on a pedestal drilled down into that science because you
Speaker 1: know how many books have we all read about someone
Speaker 1: who has achieved so much and it's like the first
Speaker 1: twenty years of their life all they did was work.
Speaker 1: You know, they didn't know their family, they didn't know anything.
Speaker 1: But look at the success that they have achieved. What's
Speaker 1: the science tell us. The science tells us that creativity
Speaker 1: acquires unstructured periods of time that cognitive tasks to get
Speaker 1: drain on your mind and you cannot just sit there
Speaker 1: and do highly complex, highly intest intense tasks for hours
Speaker 1: out of time. So if you want to do more,
Speaker 1: more work, you have to create a performance system that
Speaker 1: is built for your brain instead of just packing your
Speaker 1: day school of work. That is what the sign says.
Speaker 1: So I had a friend just text me, Ralf, a
Speaker 1: friend of the show. Uh he's the president of his
Speaker 1: own company, and he said, all right, so how much
Speaker 1: use and how much float? What's the right mix? Good question.
Speaker 1: I think it really depends on the individual. Everyone has
Speaker 1: their own different cycles. But I love that he's asking
Speaker 1: the right question. The right question is how do we
Speaker 1: create systems that reframe high performance in a way that
Speaker 1: actually works with us and not systems that we just
Speaker 1: adopted from like historical baggage. So there's no you know,
Speaker 1: easy fix, but it's it's the right question to start asking.
Speaker 1: So so okay, so this is like I feel like
Speaker 1: own little session here. So what are the things like
Speaker 1: you should be looking at to say, Okay, I gotta
Speaker 1: take this offine plant, I gotta take this offline plate,
Speaker 1: Like how do you approach it? You have to approach
Speaker 1: it by recognizing that we've all been sort of brainwashed,
Speaker 1: because this isn't about me coming on the show and
Speaker 1: being like, hey guys, take a break or hey take
Speaker 1: a nap, like we all know. We all know that
Speaker 1: this is what we should be doing. The bigger question
Speaker 1: is why don't we do it even though we know
Speaker 1: it's in our best interests. And it's when you start
Speaker 1: unraveling this complicated relationship that we have with being successful
Speaker 1: and hustling and being hyper productive and being secretly proud
Speaker 1: that we're so busy and so tired all the time.
Speaker 1: When you start to get into why that relationship would
Speaker 1: work exists, and what that represents in our lives, then
Speaker 1: you can start making these positive changes, like I'm not
Speaker 1: coming around saying, hey, guys, I've got this crazy new idea.
Speaker 1: You know, take a nap and don't work so much.
Speaker 1: It's we all know that we have to do that.
Speaker 1: High performers don't because we are so used to linking
Speaker 1: any time that's not spent working as time that's not
Speaker 1: spent striving towards our goals, and that's not true. There
Speaker 1: are Silicon Valley companies. I remember visiting Pisar years ago
Speaker 1: and there were basketball cards, and there was a basketball
Speaker 1: course excuse me, and a barbecue pit. And they made
Speaker 1: it so that if somebody wanted to work in the
Speaker 1: wee hours, they could do it if they wanted to
Speaker 1: at two in the afternoon, go out and play a game.
Speaker 1: You could do it, like, is it that kind of
Speaker 1: atmosphere that we need to be embracing or you're talking
Speaker 1: something a little bit more different. Even companies that have
Speaker 1: these types of features, oftentimes they'll notice that workers won't
Speaker 1: take them, not and won't use them, not because they're
Speaker 1: afraid of what their bosses would say, but they're you're
Speaker 1: they're afraid of what their colleagues would think and about
Speaker 1: how their colleagues were perceived, you know, their dedication to
Speaker 1: the job. So again, it's not just about having these
Speaker 1: features available, it's about really understanding that you have to
Speaker 1: reframe how you think about high performance, that investing in
Speaker 1: intentional recovery. Time you guys talked about Michael Jordan. Michael
Speaker 1: Jordan has sole off these right, there's a whole off
Speaker 1: season for him to recover, and he's very intentional about that.
Speaker 1: For him to push his body in that way, he
Speaker 1: needs to rest. We have to approach high performance the
Speaker 1: same way because what we're all doing is we don't
Speaker 1: have any off seasons. We just pretend like we're working
Speaker 1: as hard as Michael Jordan all year round, and then
Speaker 1: we wonder why burnout has become a global situation, you know,
Speaker 1: as categorized by the World Health Organization. Yeah, it's a
Speaker 1: really interesting point that the whole notion of an off
Speaker 1: season so rab. You know, as I think about where
Speaker 1: we are in the in this pandemic, we've all had
Speaker 1: this experience of our world's being turned upside down. And
Speaker 1: I think for some of us who are very fortunate,
Speaker 1: you know, there has been in some ways less work
Speaker 1: or less commute or you know, sort of less time
Speaker 1: devoted to certain things that that ate up a lot
Speaker 1: of our hours. And that's been very eye opening. At
Speaker 1: the same time, and I know you've seen this and
Speaker 1: and you've studied it much more in depth than we have.
Speaker 1: We've also seen this notion of the line to have
Speaker 1: blurred so completely because our home is our office, and
Speaker 1: our office is our home, and you know, folks are
Speaker 1: trying to educate their kids and get their work done
Speaker 1: and get on the right zoom call and things like that.
Speaker 1: How does this all net out? How do we make
Speaker 1: this at time? Again for those of us who can
Speaker 1: have that luxury to to reset a bit, it goes
Speaker 1: back to that intentionality, and it goes back to understanding
Speaker 1: the role that productivity plays in your lives. For many people,
Speaker 1: productivity and being busy has been seen as a psychological
Speaker 1: coping mechanism. We were told if you're busy enough and
Speaker 1: successful enough and productive enough, you'll be safe. And now
Speaker 1: we're experiencing economic turbulence and suddenly people don't know what
Speaker 1: to do with themselves, and so they're redirecting a lot
Speaker 1: of that productivity into their personal life, not realizing that
Speaker 1: it's also training them. And let's not forget in terms
Speaker 1: of economic turbulence, people are going to work more because
Speaker 1: they're scared to show their boss that you know, that
Speaker 1: that they're indispensable, so that's what they want to do.
Speaker 1: So you also have a lot of psychological fear behaviors
Speaker 1: that are making people not speak up when they should
Speaker 1: have because they think, I'm so lucky to have a job.
Speaker 1: I'm not going to raise my hand and say I'm
Speaker 1: not going to answer this email. So I think we
Speaker 1: really have to start at the top with leaders and
Speaker 1: companies recognizing that high performance requires intentional recovery period and
Speaker 1: that requires rethinking performance metrics, business like how the businesses is,
Speaker 1: business goals and the realistic tasks that can be accomplished.
Speaker 1: Considering that many companies think, oh, everyone's working at home,
Speaker 1: It's like, no, this is not normal times. These are
Speaker 1: not normal circumstances, and so we should not be acting
Speaker 1: like everyone should be doing the same level of work
Speaker 1: they were doing before the entire world went into lockdown.
Speaker 1: Like that's just not realistic. So does start with leaders?
Speaker 1: It has to, Yeah, because no matter what I tell you,
Speaker 1: if your boss sends you an email at ten pm
Speaker 1: or on Sunday night, most people are going to answer.
Speaker 1: You're not gonna say no to your boss. Right, So
Speaker 1: there's a pressure that comes explicitly down that if it's
Speaker 1: not clarified in terms of boundaries. Again, I can give
Speaker 1: you all the tips and all the map rooms and
Speaker 1: all the foosball tables, but if your boss is acting
Speaker 1: in a way that is generating these signs of overwork
Speaker 1: because they don't have clear expectations or boundaries, you're going
Speaker 1: to go along with it because you don't feel a
Speaker 1: sense of strong enough security right now to be able
Speaker 1: to say anything. Because people are very lucky to have
Speaker 1: a job and they're very afraid of losing their jobs.
Speaker 1: Just got thirty seconds final thoughts for everybody. Final thought
Speaker 1: is look at your sense of resistance and look at
Speaker 1: how you talk about your business and whether you're really
Speaker 1: upset that you're busy or you're kind of secretly glad
Speaker 1: that you're busy. To ask yourself, how much is what
Speaker 1: I do linked to who I am? And start the
Speaker 1: work there, and I guarantee you if you dig deep
Speaker 1: into it, you will produce your best work. And that
Speaker 1: reps up the weekend edition of Bloomberg Business Week from
Speaker 1: Bloomberg Radio. Thanks so much for joining us. I'm Carol
Speaker 1: Masser and I'm Jason Kelly. Be sure to tune into
Speaker 1: Bloomberg Business Week Radio. It's live Monday through Friday starting
Speaker 1: at two pm Wall Street Time. You can also watch
Speaker 1: the show live on YouTube. Just search for Bloomberg Global
Speaker 1: News and be sure to check out our Bloomberg Business
Speaker 1: Week Extra podcast. That's right, it's plural. This week we're
Speaker 1: bringing you to We talked about Tom Siebel. You want
Speaker 1: to check that one out, but also Richard Edelman. He
Speaker 1: is the founder and CEO of the Global Communications from Edelman.
Speaker 1: He talked about the company's spring update to its annual
Speaker 1: trust barometer and how work and workers may be different
Speaker 1: on the other side. What I love about both of
Speaker 1: them is they are looking at a world perspective when
Speaker 1: it comes to our life after the virus and actually
Speaker 1: tackling the virus. All right, everyone, we'll be back next week.
Speaker 1: At the same time, do stay safe. This is Bloomberg.