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Speaker 1: Hi, everyone, Welcome to the Bloomberg Business Week Weekend Podcast.
Speaker 1: It was the final Federal Reserve meeting of the year.
Speaker 1: As expected, FED officials cut rates by one quarter of
Speaker 1: a point. There third consecutive interest rate reduction, and I
Speaker 1: kind of say the U Essential Bank also again saying
Speaker 1: that when it comes to the dual mandate, there are
Speaker 1: risks on both sides, and so it's a challenging environment
Speaker 1: for the Federal Reserve. The Fed also maintained their outlook
Speaker 1: for just one in twenty twenty six.
Speaker 3: This time, there were three descents from both ends of
Speaker 3: the policy spectrum, highlighting divisions among policymakers over weakness in
Speaker 3: the labor market or stubborn inflation. Vetcher Powell also emphasized
Speaker 3: the committee as in a wait and see mode. He
Speaker 3: noted that for the third FMC meeting in a row quote,
Speaker 3: there is no risk free path forward. We're calling it
Speaker 3: also a challenging situation.
Speaker 1: Yeah, we got the message. Jay Powell got it loud
Speaker 1: and clear. Hey, let's unpack. So for the latest do
Speaker 1: head over to Bloomberg dot com for the latest on
Speaker 1: what economists are expecting for twenty twenty six when it
Speaker 1: comes to monetary policy. As for this hour, we're going
Speaker 1: to talk about life at the FED after j Powell
Speaker 1: with Steve Moore, he's a former economic and strategic advisor
Speaker 1: to President Trump during both of his administrations.
Speaker 3: Plus how cutting rates may affect bank lending today and
Speaker 3: into next year. Also, we talk power with nexst Era
Speaker 3: and they're push to move into data centers and gas.
Speaker 1: I love this. This is one of the big stories,
Speaker 1: one of the big stories of the year, one of
Speaker 1: the big stories certainly of this week. All of that
Speaker 1: to come. We begin with this week's FED decision. President
Speaker 1: Trump is expected to announce a new Federal Reserve chair
Speaker 1: early in the new year, although there was some speculation
Speaker 1: it could come in the next couple of weeks. It's
Speaker 1: to say, a moving story, moving target. The next Fed
Speaker 1: chair will take over Jay Powell's term, which ends in
Speaker 1: May of next year.
Speaker 3: So with them mediate thoughts of this week's FED decision
Speaker 3: and on FED leadership come twenty twenty six, We've got
Speaker 3: a great roundtable. Steve Moore is with us. He's co
Speaker 3: founder and chair of the nonprofit Unleashed Prosperity. He's a
Speaker 3: former economic and senior policy advisor to Donald Trump in
Speaker 3: twenty sixteen and twenty twenty four, and served as Chief
Speaker 3: Economist and Distinguished Visiting Fellow at the Heritage Foundation for
Speaker 3: twelve years.
Speaker 4: Yeah.
Speaker 1: He's also written a bunch of books, including Trump Andomics
Speaker 1: Inside the America First Planned to Revive Our Economy? Also
Speaker 1: another one, The Trump Economic Miracle, And you might remember
Speaker 1: back in twenty nineteen, President Trump selected Steve Moore for
Speaker 1: the Federal Reserve Board of Governors, which more ultimately withdrew from.
Speaker 1: So we have a lot to unpack and talk about.
Speaker 1: Steve joins US from Beach, Florida. Great to have him here.
Speaker 1: Also with us is Bloomberg Economics US and Canada economist
Speaker 1: Stewart Paul. He's right here in our Bloomberg Interactive Broker Studio.
Speaker 5: Steve, I want to kick it off with you. Welcome.
Speaker 1: Nice to have you here on Bloomberg. Your key takeaways
Speaker 1: from FED decision.
Speaker 6: Well, it was certainly Wall Street was happy with what happened.
Speaker 6: It was very expected that that Fed did exactly what
Speaker 6: they announced. Trump, of course wants more rate cuts. You know, Look,
Speaker 6: inflation has come down, and it's still not where we
Speaker 6: wanted to be. We wanted to be at the two
Speaker 6: percent FED target, and so we're running about two point
Speaker 6: seven two point eight, So there's still work to be
Speaker 6: done to bring inflation down. Of course, if you bring
Speaker 6: inflation down, affordability goes up. But look, this is a
Speaker 6: booming economy right now. It is so hot. Trump is
Speaker 6: right about that, and twenty twenty six is going to
Speaker 6: be a monster year for growth and for incomes and
Speaker 6: I believe for equities.
Speaker 3: If you were on the FOMC and a voting member,
Speaker 3: how would you have voted? Would you have wanted to
Speaker 3: see I.
Speaker 6: Would have done exactly what they did.
Speaker 3: You wouldn't have gone fifty basis points like Stephen Myron.
Speaker 6: No, I'm a little bit more of an inflation hawk
Speaker 6: than Steve and Steven. I know Stephen, he's a smart economist.
Speaker 6: I lean towards making sure I think the top priority
Speaker 6: of the FED should be to make sure that we
Speaker 6: bring that inflation rate down to the target level. We're
Speaker 6: not there yet, and you know, look at the as
Speaker 6: a political matter, Trump really needs to continue to bring
Speaker 6: that inflation rate down because people are still angry about prices.
Speaker 7: Mister Moore, is really difficult to square the circle between
Speaker 7: being an inflation hawk and voting for or advocating for
Speaker 7: additional rate cuts. When you see somebody like President Trump
Speaker 7: focusing so much on affordability, but at the same time
Speaker 7: calling for the FED to cut rates even more, how
Speaker 7: do you really square the circle? How would you rationalize
Speaker 7: voting for a cut while also being an inflation hawk.
Speaker 6: I believe that Wall Street puts way, way, way too
Speaker 6: much influence and interest in FED rate cuts. I mean,
Speaker 6: nobody the short term interest rate has become almost irrelevant.
Speaker 6: So I really don't believe that it's all that important. Frankly,
Speaker 6: whether it was a quarter point or fifty percent, you know,
Speaker 6: fifty points or doing nothing, I don't think that it
Speaker 6: makes all that much difference. We should have learned the lesson.
Speaker 6: By the way, look what excuse mean? What we'd all
Speaker 6: like to see is for those mortgage rates to come down,
Speaker 6: in the ten year treasury interest rate to come down. Well,
Speaker 6: the FED doesn't control that. I know that may surprise
Speaker 6: people watching this. The Fed has no impact on the
Speaker 6: ten year treasury or the thirty year mortgage. And we
Speaker 6: know that, by the way, And what happened in twenty
Speaker 6: twenty four when the FED cut the discount rate and
Speaker 6: what happened to the I mean the FED funds rate,
Speaker 6: and what happened to the mortgage rate and the tenure
Speaker 6: treasury went up. So I don't overly obsess about Fed
Speaker 6: rate cuts. I think we're in a pretty good look.
Speaker 6: The most important thing is this incredibly healthy economy. We've
Speaker 6: got hundreds of billions of dollars coming into the US
Speaker 6: economy of foreign investment. We've got the highest s and
Speaker 6: P five hundred, the highest Dow, and the highest NASSE
Speaker 6: in the history of the country. People are making huge
Speaker 6: amounts of money, and this is a bet when the
Speaker 6: markets go up, this is a bet that policy will
Speaker 6: be well guided and that American companies are going to
Speaker 6: make money. So I have a hard time really having
Speaker 6: many much problem with the direction that we're going in
Speaker 6: with respect to this economy, and don't forget the starting
Speaker 6: in January, people will start to see the middle income
Speaker 6: people will start to feel the impact of those big,
Speaker 6: beautiful tax cuts that passed in terms of less money
Speaker 6: deducted from their paychecks and taxes, and the no tax
Speaker 6: on tips, the no tax on overtime. Those are all
Speaker 6: positive features that will help middle class Americans.
Speaker 7: That's a really interesting point that fiscal policy is going
Speaker 7: to be especially accommodative in twenty twenty six. And I
Speaker 7: think that one thing that's interesting is whether we're going
Speaker 7: to see monetary policy that's equally accommodative or even more so,
Speaker 7: And that's going to really depends on who we get
Speaker 7: as theft the next Chairman of the Federal Reserve and
Speaker 7: chairman of the FOMC. What do you make of the
Speaker 7: White House's floating of a trial balloon with Kevin Hassett
Speaker 7: about three weeks ago and then seeming to reconsider You know,
Speaker 7: if there's anybody in the world who recognizes how difficult
Speaker 7: a process it can be to make it through the Senate,
Speaker 7: it's you. And so I'm really interested to hear what
Speaker 7: your thoughts on what your thoughts are about what's going
Speaker 7: on in the White House and on Capitol Hill in
Speaker 7: terms of whipping up the votes to support someone perhaps
Speaker 7: like Hassett or wash.
Speaker 6: I like them both. I mean, I think the two Kevins,
Speaker 6: I've been saying this for two years now that you know,
Speaker 6: it should be one of those two as the FED chairman.
Speaker 6: I also like Larry Kudlow, but I don't think Larry
Speaker 6: probably is in the running things to do it. But
Speaker 6: he'd be an excellent FED share as well. But look,
Speaker 6: the two Covens are monetary experts. They're extraordinary economists. I
Speaker 6: really truly. Either one of them I think would be
Speaker 6: fantastic picks. And I think they would also keep their
Speaker 6: eye on the most important thing that the FED needs
Speaker 6: to do, which is defend the dollar. Defend the dollar,
Speaker 6: make sure that it's strong and stable. That's all the
Speaker 6: FED needs to do. It doesn't have to worry about jobs,
Speaker 6: it doesn't have to worry about climate change or any
Speaker 6: of these other things. The most important thing is to
Speaker 6: keep prices stable and the dollar strong, and I think
Speaker 6: both would do that.
Speaker 1: Steve, you have some great insight into President Trump behind
Speaker 1: closed doors. You know he did nominate you for a
Speaker 1: FED governor position. You ultimately backed out of it, But
Speaker 1: I'm just curious what were your conversations with President Trump
Speaker 1: or what insight can you give to our audience, an
Speaker 1: investing audience trying to understand read the tea leaves, because
Speaker 1: we do have a president that most would agree that
Speaker 1: he's transactional, and so I think we're trying to understand
Speaker 1: that in terms of any appointments. Is that seen as
Speaker 1: an expectation that you're going to do the President Trump's
Speaker 1: bidding and listen to him if you are at the
Speaker 1: FED in terms of what needs to be done in
Speaker 1: cutting rates, if that's what he wants.
Speaker 6: Well, look, my opinion is that it is it is
Speaker 6: valuable to have an independent FED, but I also believe
Speaker 6: the net the FED needs to be accountable, and in
Speaker 6: my opinion, it hasn't been accountable in the last few years.
Speaker 6: That's why we got, you know, a nine percent inflation
Speaker 6: under the current Joan Powell and well.
Speaker 1: When you say that that nine percent was the result
Speaker 1: of the pandemic and incredible demand, I mean there were
Speaker 1: some you know, unexpected events.
Speaker 3: That's crazcal policy too.
Speaker 1: Fiscal policy, there was a lot of money slashing around
Speaker 1: when you can see that that nine percent inflation, any
Speaker 1: president or any fed shair would have had to deal
Speaker 1: with that.
Speaker 6: Well listen. I mean, I do think that Trump made
Speaker 6: a big miss in that he passed a big, massive
Speaker 6: spending bill right before he left office. So could you
Speaker 6: make a good point, But it was catastrophic everything that
Speaker 6: happened under COVID. We made the biggest mistake in the
Speaker 6: history of the United States and shutting down our economy,
Speaker 6: shutting down our schools, shutting down our hospital It was
Speaker 6: outrageous and I think we've hopefully learned that level lesson
Speaker 6: that will never never do it again. But you are
Speaker 6: quite correct that what caused the inflation, and I hope
Speaker 6: we remember this lesson for many, many decades to come,
Speaker 6: is that when you massively spend four trillion dollars, guess
Speaker 6: what you're going to have inflation. And it didn't stimulate
Speaker 6: the economy. It caused huge, huge reductions and real incomes
Speaker 6: for middle class people. It destroyed middle class incomes. They
Speaker 6: lost massive amounts of money because we very stupidly printed
Speaker 6: all this money and spent it, dropped it out of helicopters.
Speaker 6: And that's a policy that's never worked.
Speaker 3: Look, I think I think it's an important you bring
Speaker 3: up a lot of important points about what happened during
Speaker 3: the pandemic and the causes of inflation. But to Carroll's point,
Speaker 3: you know, you do have this direct line to the
Speaker 3: White House and to the President. You advised him back
Speaker 3: in twenty sixteen, you advised him in twenty twenty four.
Speaker 3: How would you characterize relationship with him right now? And
Speaker 3: to what extent are you and how often are you
Speaker 3: speaking to him about economic matters that hit the United States.
Speaker 6: What I tell him is that I think the tax
Speaker 6: cuts have been enormously beneficial, and it's not a commen
Speaker 6: date of fiscal policy on the tax side. What it is.
Speaker 6: I mean, like one of the most important things we
Speaker 6: did in the Big Beautiful Bill was we are allowing
Speaker 6: businesses to, you know, instantly capitalize their expenditures and write
Speaker 6: them off instantly. And I believe that's one of the
Speaker 6: reasons we're seeing this capital boom in the United States.
Speaker 6: I mean, if you look at the last nine months,
Speaker 6: capital investment has been really strong as a result of
Speaker 6: this tax cut. So it wasn't really meant to just
Speaker 6: pump money. Economy was meant to incentivize through lower tax rates,
Speaker 6: lower lowering the corporate rate, giving expensing, lowering the individual
Speaker 6: income tax rate. Those are pro growth, pro supply side
Speaker 6: policies that actually help bring inflation down. I mean, it's
Speaker 6: very simple. If the economy produces more, prices go down.
Speaker 1: Hey, one of the things I do wanted to go
Speaker 1: back to this idea of transactional and again I'm going
Speaker 1: to go back to the insight that you have and
Speaker 1: having conversations with President Trump before he, you know, made
Speaker 1: a nomination for you to join the FED and be
Speaker 1: a governor. Because we've heard Jay, the President come out
Speaker 1: and say j. Powell has been very bad for our country.
Speaker 5: He's terrible.
Speaker 1: He's a terrible FED chair. I'd love for him to
Speaker 1: lower interest rate. I call him too late. I'd love
Speaker 1: to fire him.
Speaker 5: Tell us about.
Speaker 1: Would there be pressure by President Trump with who he
Speaker 1: appoints for the next FED share and would there be
Speaker 1: an assumption by the person who takes that position to
Speaker 1: kind of do the President's bidding. Give us some insight
Speaker 1: if you could.
Speaker 6: Well, I'll put it a little differently. It's a good question.
Speaker 6: First of all, when I was nominated to be on
Speaker 6: the FED. Trump never really, you know, asked me about well,
Speaker 6: would you cut rates or would you raise rates or
Speaker 6: so on. He just he had trusted in me as
Speaker 6: an economist that I would get it right, so there
Speaker 6: was no pressure to, you know, sort of do his bidding.
Speaker 6: Now with respect to Kevin Hassett or Kevin worsh which
Speaker 6: I think is a good chance it's gonna be one
Speaker 6: of those two. What he is doing is picking someone,
Speaker 6: you say, do his bidding. He's picking someone who agrees
Speaker 6: with his overall economic philosophy, and that's exactly what a
Speaker 6: president should do. I don't think that means undue influence
Speaker 6: on the independence of the FED, but I think it's basically,
Speaker 6: you know, presidents deserve the monetary policy they want, frankly,
Speaker 6: and so you know, I think they will they will
Speaker 6: do they agree with Trump on monetary policy, and that's
Speaker 6: one of the reasons one of the two of them
Speaker 6: will be chosen. But I can't think of two economists
Speaker 6: I admire more than Kevin Hassett and Kevin Warsh.
Speaker 7: It's interesting that you bring up President Trump's economic philosophy
Speaker 7: because I think that if you were to press him
Speaker 7: to describe his economic philosophy with regards to monetary policy,
Speaker 7: he would just say he's a low interest rate guy.
Speaker 7: So is the expectation going to be from you know,
Speaker 7: Kevin Hazard or Kevin Warsh that they will just deliver
Speaker 7: low interest rates.
Speaker 6: You know, you make a good point. The one thing
Speaker 6: that Trump has often said to me is that he
Speaker 6: likes low interest rates. And and I've always said, well,
Speaker 6: mister President, low interest rates are good, but we also
Speaker 6: want to make sure we don't cause inflation. And so
Speaker 6: that is the kind of dual competing interests here. But
Speaker 6: I think he gets it that you know what destroys
Speaker 6: a presidency is inflation for one of whatever. You know,
Speaker 6: we saw Jimmy Jimmy Carter lose because of inflation. We
Speaker 6: saw Jerry Ford lose because of inflation. We saw this.
Speaker 6: I think the major fat during this last of presidential
Speaker 6: election was inflation. Americans hate, hate higher prices. It's one
Speaker 6: of the reasons they're still in a foul mood on
Speaker 6: the economy. So I believe that Kevin Hassett and Kevin
Speaker 6: worsh either one of them, will be an inflation hawk,
Speaker 6: and they will, I predict, we will bring that inflation
Speaker 6: right down to two percent, But.
Speaker 1: One does wonder, since he's not running again, assuming no
Speaker 1: third term, that maybe he doesn't care if there's inflation.
Speaker 1: I'm just going to put that out there.
Speaker 5: Why don't you want to go somewhere?
Speaker 3: I mean, the Republicans certainly care, and affordability is going
Speaker 3: to be a key message for them in the mid
Speaker 3: for everybody in the midterm. Hey, we only have thirty
Speaker 3: seconds left, Steve. I just want to take a sharp
Speaker 3: turn here because, yeah, because you are an economist and
Speaker 3: you watch what's happening closely, the US taking a stake
Speaker 3: in publicly traded companies such as Intel, MP, Materials and others.
Speaker 6: I don't like it. Hey, wow, no, no, no, never.
Speaker 6: You know, I've spent most of my career trying to
Speaker 6: advertized not nationalized. So it's one of those issues I
Speaker 6: disagree with the President on. I don't want. I believe
Speaker 6: in separation of business and state, and the less you know,
Speaker 6: the government does to you know, to influence business decisions.
Speaker 3: I think the better your old school that way.
Speaker 6: Yeah, I am.
Speaker 3: It's a different it's definitely a different Republican Party, at
Speaker 3: least from a business perspective. Today.
Speaker 5: I think there's a.
Speaker 1: Lot of investors out there too who certainly would agree
Speaker 1: with you. Steve, Thank you so much, Really enjoyed this.
Speaker 1: Steve Moore, co founder and share of the nonprofit Unleashed Prosperity,
Speaker 1: and of course, as we said, a former economic and
Speaker 1: senior advisor to President Trump in both of his terms,
Speaker 1: and of course are great thanks to our own Bloomberg
Speaker 1: Economics US and candidate economist Stewart Paul.
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Speaker 1: Let's get more on this week's FED decision and really
Speaker 1: the macro environment when it comes to consumers and businesses,
Speaker 1: and also what we're seeing when it comes to bank
Speaker 1: lending today and maybe an outlook into the new year.
Speaker 1: One company, one bank paying close attention to this is
Speaker 1: Ohio based Huntington Bank Shares. The bank has a market
Speaker 1: cap of nearly twenty seven billion dollars in recently has
Speaker 1: been expanding with targeted acquisitions. It's had a pretty busy
Speaker 1: year tim.
Speaker 3: With perspective on interest rates, the consumer, and the twenty
Speaker 3: twenty six financial outlook. We turned to Zach Wasserman. He's
Speaker 3: chief financial officer of Huntington Bank Shares, and he joined
Speaker 3: us in the Bloomberg Interactive Brokers studio. Zach, great to
Speaker 3: talk with you again, especially appreciate you coming into the studio.
Speaker 3: Did the FED get it right?
Speaker 8: I think they did.
Speaker 9: You know, the analysis they did that showed the labor
Speaker 9: markets still, of course softening to some degree, but inflation
Speaker 9: pressures continuing to be present and with a potential for
Speaker 9: some higher price pressures as we go into the early
Speaker 9: part of next year. I think they got it right,
Speaker 9: and I think the outlook for they've said they'll probably
Speaker 9: one additional cut into twenty twenty six. The market, by
Speaker 9: the way, is making in two cuts for twenty twenty six.
Speaker 9: Somewhere in that range seems very likely and I think
Speaker 9: helpful for the economy at this point.
Speaker 5: All right, Zach, So if you were sitting down with J.
Speaker 10: Powell, what would.
Speaker 1: You want to ask him right now?
Speaker 8: That's a good question. What is he going to do
Speaker 8: after he leaves his job?
Speaker 3: Would you do you think he will leave his job
Speaker 3: in this ring?
Speaker 8: I would think so that's mine, that's myself.
Speaker 1: But do you think then also Kevin has it is
Speaker 1: a given like we're seeing that the President's meeting with
Speaker 1: Kevin warsh like, so it feels like things are still fluid.
Speaker 11: Well, I'm not a party to those discussions.
Speaker 9: I have no clue, but I certainly think that you know,
Speaker 9: as the uh uh, you know, as they as they
Speaker 9: think about how that how they're going to chart their
Speaker 9: course on interu straight policy, I think the path that
Speaker 9: they've chosen at this point appears to be the right one,
Speaker 9: very data reliant, appears to be you know, we're landing
Speaker 9: that the economy in a sweet spot.
Speaker 3: Okay, so can can Carol? Are you done with FED stuff?
Speaker 3: Can I talk em here?
Speaker 6: Yes?
Speaker 11: Okay?
Speaker 3: To you haven't been so acquisitive. I mean there's been
Speaker 3: a lot of M and A in your space. You've
Speaker 3: been much more aggressive than others in your peer group.
Speaker 3: Why now, in terms of the aggression aggressive posture.
Speaker 9: Well, I wouldn't characterize our posture as aggressive. It's really,
Speaker 9: you know, for.
Speaker 5: Us, expansive, that's for sure.
Speaker 8: Well, certainly it's expansive.
Speaker 9: It's been it's been a dynamic year for us, but
Speaker 9: primarily from an organic growth perspective, Huntington has been growing
Speaker 9: way faster than almost any other bank in the industry
Speaker 9: at this point from an organic perspective. And so when
Speaker 9: we think about these partnerships that we've announced, with the
Speaker 9: pleasure to announce two partnerships this year, it's really all
Speaker 9: in service of sustainable, long term organic growth.
Speaker 3: We want to call them partnerships, not acquisition.
Speaker 8: We really do, and that's intentional.
Speaker 9: The the partnerships we've created with Veritechs Bank and then
Speaker 9: Cadence Bank, UH really are in fact bringing these organizations together,
Speaker 9: making one plus one equals three and for us will
Speaker 9: be a powerhouse in Texas, will be present in a
Speaker 9: lot of terrific markets across the South, and and really
Speaker 9: together we're going to be a much stronger organization. So
Speaker 9: they really are partners and ultimately all in service of
Speaker 9: long term sustainable organic growth.
Speaker 1: So you know, I've got family in South Carolina. They've
Speaker 1: noticed some economic softness, and certainly the very Techs deal
Speaker 1: was about North Carolina and South Carolina. They've seen softness
Speaker 1: in real estate which had been on fire. I'm just
Speaker 1: curious your expansion plans there, your organic growth that you
Speaker 1: want to do there. I think you guys were looking
Speaker 1: to open more than fifty branches in those states, So
Speaker 1: is that impacting any of the growth? Are you on
Speaker 1: target for them?
Speaker 8: We're on target for that.
Speaker 9: In fact, next year we expect to open one branch
Speaker 9: every two weeks in the Carolina. So we've got some
Speaker 9: products for your family, and we'd love to take you
Speaker 9: on this customer. But we're really excited about that, and
Speaker 9: in fact, the market reception we've had so far has
Speaker 9: been tremendous.
Speaker 8: We've opened a.
Speaker 9: Several new branch locations just in the last few months,
Speaker 9: and each of them have beat their full year first
Speaker 9: year deposit plan before they've even opened, to give you
Speaker 9: a sense, because the market reception has been so strong.
Speaker 3: So with the look, I know, you know, I can
Speaker 3: ask the question. But in terms of what you have
Speaker 3: planned any more acquisitions? You know, look, how are you
Speaker 3: thinking about it?
Speaker 8: But the way we're thinking about it is if something
Speaker 8: comes up.
Speaker 1: Here hes you just said, they expect more, they expect
Speaker 1: more acquisitions to happen.
Speaker 5: Do you know.
Speaker 9: I think the industry has been consolidating for twenty years.
Speaker 9: It will continue to consolidate for us. If something comes
Speaker 9: up that's that's a creative to organic growth, that's a
Speaker 9: great fit for us, will consider it. But otherwise it's
Speaker 9: all about organic growth for us.
Speaker 3: Geographically, what's an area of the country that's of interest
Speaker 3: to you where you don't have a presence.
Speaker 9: We love the markets that we're in right now, our markets.
Speaker 9: We're going to be twenty one states covering more than
Speaker 9: fifty percent of the population of the country, and in
Speaker 9: markets collectively that are growing thirty percent faster.
Speaker 3: Than the national A lot of states you're not in.
Speaker 9: True, you know, I think our view is we're not
Speaker 9: trying to be a national bank.
Speaker 1: We're trying to you're not trying to be a national.
Speaker 9: Stake Explicitly, we want to be deeply present in the
Speaker 9: states that we're in.
Speaker 3: So would that mean that if there were more expansion,
Speaker 3: it would be within the states that you're already in,
Speaker 3: so you can become bigger in those place is rather
Speaker 3: than expanding the geographic foot printed places or something fit.
Speaker 8: I think that that's the right characterization.
Speaker 9: Okay, yes, but I think again that's not our Our
Speaker 9: objective is not m and a per se.
Speaker 8: Our objective is organic growth.
Speaker 1: The Goldman Financials Conference and I think that's part of
Speaker 1: also why the KBW Bank Index really rallied in a
Speaker 1: big way, our performance about two and a half percent higher.
Speaker 1: They many said, and you guys presented there too, that
Speaker 1: they're seeing a stable consumer despite worries of an economic
Speaker 1: slow down. What are you guys seeing?
Speaker 9: We're seeing the same. I think we just were up
Speaker 9: on stage this morning ourselves. That's the consumer stable, Consumer
Speaker 9: pipelines continue to be strong. From a lending perspective on
Speaker 9: both consumer and commercial profitability is very strong. Credit is
Speaker 9: very stable. It really looks like a solid economy from
Speaker 9: our perspective. If all you did was read our internal reports,
Speaker 9: it would belie what you're hearing in terms of the headlines,
Speaker 9: which is very encouraging as we go into the end
Speaker 9: of this year into next year.
Speaker 3: Why do you think you're seeing that distinction, like you're
Speaker 3: seeing something The anecdotes and indeed some data are showing
Speaker 3: softness in places. Why are you seeing strengths?
Speaker 9: Well, Look, I think in total, you're seeing consumer spending
Speaker 9: continues to grow. Corporations I think are more confident today
Speaker 9: than they would have been at the middle of this
Speaker 9: year when there was more uncertainties in the environment. We've
Speaker 9: had a tax bill pass, we've had more teriffs, certainty
Speaker 9: come into the environment. The government is now functioning again.
Speaker 9: I think as companies are looking forward into twenty six,
Speaker 9: they're seeing this is another year of growth.
Speaker 8: The Fed just came out today saying that.
Speaker 9: The outlook for economic growth next year was more than
Speaker 9: two percent GDP, and so that looks like an environment
Speaker 9: where we should continue to be investing, continue to be expanding,
Speaker 9: continue to be expanding. In from a commercial and consumer perspective,
Speaker 9: there is of course a bit of a so called
Speaker 9: K shaped shaped economy happening, and I think certain segments
Speaker 9: of the consumer environment have faced pressures, particularly from inflation
Speaker 9: and higher interest rates. Our bank does not have much
Speaker 9: exposure to that, and I think in many cases the
Speaker 9: net of growth is continued to be.
Speaker 1: Who is your typical consumer?
Speaker 9: You know, from us, we're focused on the mass affluent
Speaker 9: consumer base, and.
Speaker 1: That's more specifically target we do, okay, sorry forgive me
Speaker 1: go ahead.
Speaker 9: We target the mass affluent, and we've got a very
Speaker 9: strong base of consumers that are that are.
Speaker 8: In that segment.
Speaker 9: And then of course we also one of the large
Speaker 9: and largest small business banks and commercial banks in the
Speaker 9: country as well.
Speaker 3: What does mass affluent mean in your markets?
Speaker 9: You know, typically we're looking at customers who have a
Speaker 9: net worth of or income of more than a hundred
Speaker 9: thousand dollars, net worths that are that are high. And
Speaker 9: of course we we bank everyone, and we really our
Speaker 9: tagline is welcome to all, and we mean that. But
Speaker 9: for the most part, our business is concentrated in that
Speaker 9: mass affluent segment.
Speaker 1: From it, so loan origination activity, tell us about what
Speaker 1: you're kind of seeing since do you last reported?
Speaker 11: Yeah?
Speaker 9: In fact, we just this morning showed a quarter to
Speaker 9: date loan growth of two point eight billion dollars sequentially
Speaker 9: from last quarter. Yeah, we're growing at about eight to
Speaker 9: nine percent year on year right now, Uh, and actually
Speaker 9: exceeding our own forecast that we set just a month ago.
Speaker 3: In the brad press efforts today, I've found what jap
Speaker 3: Powis said about AI really fascinating. This idea of productivity,
Speaker 3: and it's going to get me to ask every single
Speaker 3: person I talked to about how not just how they're
Speaker 3: using AI, but like productivity increases at your bank, Like
Speaker 3: what are you seeing? How are they using it?
Speaker 9: We're doing a lot in AI actually increasing it sure is.
Speaker 9: I mean to give you a sense. Last year, in
Speaker 9: the fourth quarter, we had two GENAI projects going through
Speaker 9: our risk evaluation and implementation. Today we have thirty. There's
Speaker 9: about a dozen per month that are coming into the pipeline.
Speaker 9: Software engineering is being made much more more productive. We're
Speaker 9: seeing all manner of internal process improvement and now customer
Speaker 9: facing applications as well, things that make the loan approval
Speaker 9: process seamless and more effective, more personalized service.
Speaker 3: Is that going to increase earnings for you?
Speaker 9: Look, I think it will certainly create capacity for us
Speaker 9: to then invest more. You know, our modus operandi is
Speaker 9: to harvest and try to drive efficiencies in the baseline
Speaker 9: costs can deploy those expenses into investments.
Speaker 1: A few years ago, I used to actually drive up
Speaker 1: to make a deposit. I used to talk to a teller.
Speaker 1: I mean I was a kid at the time, you know,
Speaker 1: and had my little book. But having said that, I
Speaker 1: don't talk to a teller for the most part anymore.
Speaker 1: So will AI in your estimation? We are talking to CEOs.
Speaker 1: Our team, our tech team just did a big AI
Speaker 1: report and they're talking to executives across industries. Everybody seems
Speaker 1: to be in an AI, but in terms of VET JR. J.
Speaker 1: Powell saying AI hasn't really impacted the labor market yet,
Speaker 1: will it does?
Speaker 5: It has to?
Speaker 12: Right?
Speaker 9: Look, I think in the end AI will touch almost
Speaker 9: every element of human life and commercial activity and ultimately
Speaker 9: will supplant many of the more rote processes.
Speaker 8: That we use people to do. But it'll mean people
Speaker 8: could do other things. This will be a change in
Speaker 8: the in.
Speaker 9: The labor force in terms of what people are are doing,
Speaker 9: and there's things that people can uniquely do. Make judgments,
Speaker 9: be creative, interact with other people, lead organizations. I think,
Speaker 9: you know what's incumbent upon all employees And I think
Speaker 9: about this myself, is you know where can I shift
Speaker 9: my activities to where I uniquely add value?
Speaker 5: People matter?
Speaker 1: You matter?
Speaker 3: Ah, thank you, Thank you, Jan you matter.
Speaker 1: Zach Wasserman, thank you so much.
Speaker 8: With you.
Speaker 2: This is the Bloomberg Business Week Daily Podcast. Listen live
Speaker 2: each weekday starting at two pm Eastern on Apple car
Speaker 2: Play and the Android Auto with the Bloomberg Business app.
Speaker 2: You can also listen live on Amazon Alexa from our
Speaker 2: flagship New York station, just Say Alexa played Bloomberg eleven.
Speaker 1: Thirty So next with us, we want to get into
Speaker 1: what we have been talking about a lot this year, Matt,
Speaker 1: and that is the AI and data center build at
Speaker 1: It is really one of the biggest stories of really
Speaker 1: this year, but also I feel like the last few
Speaker 1: years question remains of where all the power needed for
Speaker 1: them will come from and who will pay for it?
Speaker 1: And on that we had next Era Energy. It's a
Speaker 1: clean energy company focuses on wind, solar, and battery storage energy.
Speaker 1: They announced plans to expand into net gas natural gas,
Speaker 1: including a power plant deal with Exceon and Google, and
Speaker 1: plans to buy the gas retailer Symmetry Energy Solutions. The
Speaker 1: company also anounce a deal with Meta to supply it
Speaker 1: with both clean energy and evaluate a new gas fired
Speaker 1: power plant out in the Midwest. And then don't forget back.
Speaker 1: In October, the company also made some headlines with plans
Speaker 1: to revive a nuclear power plant for Google's data centers.
Speaker 1: This has been an all in theme if you will,
Speaker 1: this year, So let's get into it with two of
Speaker 1: our team members Bloomberg News energy reporters Will Wait and
Speaker 1: Josh Saul, both here in studio. So, guys, I mean
Speaker 1: deals being made. We know that there's a lot going on, Josh,
Speaker 1: let me start with you in terms of significant changes.
Speaker 1: Is a lot of this just talk or we're starting
Speaker 1: to see action in terms of changes to the grid
Speaker 1: adding capacity?
Speaker 5: What are we seeing?
Speaker 13: Thanks, First, I'd say next Era not just a clean
Speaker 13: energy company. It's a huge utility. And then they have
Speaker 13: a big development arm that historically has done a massive
Speaker 13: amount of clean energy. It's changing is that they're going
Speaker 13: that development arm is going more and more into developing
Speaker 13: gas and then also turning on turning back on a
Speaker 13: nuclear power plant in order to power these data centers.
Speaker 13: So it's what we saw was really investors looking at
Speaker 13: that change and saying we're not sure that that change
Speaker 13: is happening fast enough and strong enough for what we expected.
Speaker 4: So but they are like a best in class developer
Speaker 4: of especially renewable energy right as well. Hence next Era
Speaker 4: can they become a best in class gas developer.
Speaker 13: The investors we talk to think that they can. But
Speaker 13: similar to what we've seen with some of the independent
Speaker 13: power producers, there's just a really big hunger among investors
Speaker 13: to see these deals coming faster and faster, and investors
Speaker 13: want more details. They're fine to see a big new
Speaker 13: announcement saying that we plan to do things with Google,
Speaker 13: but they want to see signed contracts for deals with
Speaker 13: price points and timelines. And when we don't see the
Speaker 13: those kind of details, we see big share drops.
Speaker 1: Well that's it, you know, we'll come on in on
Speaker 1: here because I think you know, some of what we
Speaker 1: were hearing. I was hearing for a while too, was
Speaker 1: that when it comes to companies, especially kind of the
Speaker 1: MAGSV and the big hyperscalars, they were signing up or
Speaker 1: announcing deals with a lot of different utility companies, but because.
Speaker 5: They wanted to make sure wherever they got.
Speaker 1: Their power, they got power, and that maybe not all
Speaker 1: of that would be carried out.
Speaker 5: In other words, they wouldn't get power from all of them.
Speaker 14: Yeah, we've seen just deal after deal after deal, all
Speaker 14: these tech companies. They need as much electricity as they
Speaker 14: can get it, and they need it, They need it yesterday.
Speaker 14: They can't bring it on fast enough. And we've seen
Speaker 14: a lot of people talking about building power plants, but
Speaker 14: we really need to see these plants actually getting built
Speaker 14: and getting connected to the grid and sending real electricity.
Speaker 5: Why aren't they getting built? Is it because they're expensive.
Speaker 1: There's regulatory issues, there's where you build them, issues like
Speaker 1: what is it?
Speaker 14: There's a lot of regulatory issues. They it used to
Speaker 14: be expensive, but tech companies have so much money to
Speaker 14: throw at the problem that I wouldn't say that's top
Speaker 14: of the list nowadays. But there's definitely connection problems. We
Speaker 14: need to build the wiring to deliver the power. There's
Speaker 14: just so much stuff that has to happen, you know that.
Speaker 4: I can't remember who wrote it, but a couple of
Speaker 4: years ago there was an insane Business Week story about
Speaker 4: how difficult it was to put up lines right from
Speaker 4: power developers to the end customer and it took, you know,
Speaker 4: years and years of trying to get through this regulation.
Speaker 4: Is there any sign that this administration is going to
Speaker 4: be getting rid of that regulations as it has, you know,
Speaker 4: wanted to do.
Speaker 11: I've written stories like that.
Speaker 13: There's a power line that was going through Colorado that
Speaker 13: had been planned for seventeen years to get the you know,
Speaker 13: to wind energy from Wyoming to you know, all the
Speaker 13: people in southern California was where that line was supposed
Speaker 13: to go, and it just kept getting hung up on
Speaker 13: different things. The Trump administration has made announcements and has
Speaker 13: executive orders about clearing out red tape and making all
Speaker 13: of this happen faster. But the actual, the actual grease,
Speaker 13: the actual what's needed to speed that up, I think
Speaker 13: takes even kind of deeper work in these regulatory agencies
Speaker 13: on It remains to be seen whether any of that,
Speaker 13: any of that bluster, actually ends up.
Speaker 4: To you big executive orders just canceling state regulations on
Speaker 4: this and taking over with federal control.
Speaker 5: Well that's the difference, right, because the states have some say.
Speaker 6: In all of this.
Speaker 14: They do, and the executive orders can't just wipe out
Speaker 14: existing laws. As much as Trump thinks sometimes he has
Speaker 14: that power, he doesn't have all the power he thinks
Speaker 14: he has.
Speaker 11: So all of.
Speaker 14: These things that the President has said, we're going to
Speaker 14: do this, it really bumps up against the realities of
Speaker 14: the regulatory process.
Speaker 4: It does seem like this administration is against certain forms
Speaker 4: of power generation wind for example. It's no secret that
Speaker 4: Donald Trump hates wind power. He cares a lot about birds,
Speaker 4: and he's worried about them.
Speaker 14: He's taken huge steps to make it much harder to
Speaker 14: develop wind power and solar power, and he really would
Speaker 14: love to see more gas and anything to do with
Speaker 14: fossil fuels. But it's it's a short sighted policy. We
Speaker 14: really do need everything, and you know, solar is the
Speaker 14: fastest thing we can build, but gas is pretty close
Speaker 14: to it, and that's probably what we're going to see
Speaker 14: a lot of real soon.
Speaker 4: But if we're going to build fifteen giga lots of
Speaker 4: power new power production in the next what seven years,
Speaker 4: don't we need to use every possible source.
Speaker 11: We definitely, we definitely do.
Speaker 13: But what we saw I was looking I was pouring
Speaker 13: through the Next Era release today and you see their
Speaker 13: renewable plans kind of going up through twenty thirty, but
Speaker 13: then there's the phase out, you know, the Trump phase
Speaker 13: out of clean energy tax credits, and then they sort
Speaker 13: of plateau.
Speaker 1: Well, the other thing is nuclear, and we've talked a
Speaker 1: lot about nuclear like this is not. Everybody's talking about
Speaker 1: it like it's going to just happen tomorrow, and it's
Speaker 1: that's not the case.
Speaker 5: This is years in the making.
Speaker 14: Still, the line I've been used about nuclear for the
Speaker 14: past few months is that there's a lot happening in
Speaker 14: nuclear and there's nothing happening in a nuclear So lots
Speaker 14: of people are talking about it. There's smart people trying
Speaker 14: to do smart things. It just moves slower than anything
Speaker 14: else we write about.
Speaker 4: So a nuclear I guess, must be almost as beloved
Speaker 4: as coal and natural gas by this administration. Is what
Speaker 4: we're seeing with next era is that kind of an
Speaker 4: admission that the clean energy, you know, renewable economics without
Speaker 4: these tax credits just don't really work out next year.
Speaker 13: It makes the point a lot that the clean energy
Speaker 13: is the fastest way to hook up new data centers.
Speaker 13: But I think they also see that with kind of that,
Speaker 13: with the headwind of the Trump tax credits going away,
Speaker 13: they need to in order to get the kind of
Speaker 13: earnings growth that investors expect, they have to expand beyond
Speaker 13: clean energy and do a lot more gas, which they've
Speaker 13: already done with their regular related utility, but they need
Speaker 13: to do with their unregulated development arm and they need
Speaker 13: to get this data center game really dialed down.
Speaker 5: But we've talked, right, guys.
Speaker 1: I mean, when it comes to wind solar, like these
Speaker 1: alternative energy, they financially make sense for a lot of
Speaker 1: businesses much more than they did initially. Right, They make
Speaker 1: sense in terms of the investment the Coster.
Speaker 14: Are you Wind and solar are the cheapest forms of
Speaker 14: new power to build, Yeah, have been for a while.
Speaker 5: So why aren't we doing also?
Speaker 4: I mean, try getting a turbine right now. I mean
Speaker 4: it's not glass turbine, no wind propeller, right isn't the
Speaker 4: waiting list years.
Speaker 14: It's the gas turbines that we're seeing the biggest waitlist
Speaker 14: for these days, and especially because the hostility of the
Speaker 14: Trump administration for the wind farms, I haven't heard as
Speaker 14: many complaints.
Speaker 4: So you can get the wind turbines, you can get
Speaker 4: the windmills.
Speaker 1: You can't get the turbine for your backyard, Okay, but
Speaker 1: it's hard to connect.
Speaker 14: There's still a years long wait to connect new power
Speaker 14: to the grid.
Speaker 13: Yeah, you run into the same sort of permitting and
Speaker 13: roadblocks that you do kind of with anything.
Speaker 5: Well, is the.
Speaker 1: Grid ready for all of this extra energy? I mean, Josh,
Speaker 1: I mean that's the other thing that we've talked about,
Speaker 1: I feel like for years.
Speaker 13: So that get says another thing that my team has
Speaker 13: been talking about the most recently, which is affordability. Just
Speaker 13: two steps to get there. Upgrading the grid in order
Speaker 13: to add all these new data centers and Also, all
Speaker 13: this new clean energy just takes a lot of upgrades,
Speaker 13: a lot of a lot of making the grid stronger, better, faster,
Speaker 13: more transmission lines running around to connect in both data
Speaker 13: centers and also to connect in new new new forms
Speaker 13: of power, whether it's a gas plan or solar. All
Speaker 13: those upgrades cost a lot of money. Those costs are
Speaker 13: spread out pretty broadly among all customers, so we're seeing
Speaker 13: big rate increases, both big bill increases UH for customers.
Speaker 13: And people are angry. People are really mad. And we
Speaker 13: saw that in elections in Virginia and New Jersey, yes,
Speaker 13: and we expect to see it in the mid terms
Speaker 13: next year.
Speaker 5: It's so funny.
Speaker 1: I was just with a bunch of family down like
Speaker 1: in South Carolina, and that's what we talked about power
Speaker 1: prices and how they are incented to do things like
Speaker 1: you know, air conditioning, do it, I guess at night
Speaker 1: or something and so and then turn it off like
Speaker 1: when they get up, so that the house stays cool,
Speaker 1: but they're not taxing the grid when everybody else is.
Speaker 13: Some of that's good, some efficiency is good, but the
Speaker 13: level of anger and people talking about it the way
Speaker 13: they've historically talked about gas gasoline prices or more recently
Speaker 13: eggs and groceries. The fact that that's now slashing over
Speaker 13: onto utilities is a rough thing for these companies to
Speaker 13: deal with.
Speaker 5: Is it just likely to get worse?
Speaker 1: Well, because it's just the demand is increasingly there.
Speaker 14: Yeah, we definitely think power prices are going to continue
Speaker 14: to go up. We'll hear a lot more about it
Speaker 14: next year during the elections. And don't forget about the
Speaker 14: cost to upgrade the grid to protect it from climate
Speaker 14: change issues, wildfires and hurricanes. That's another cost that's going
Speaker 14: to everyone is going to have to bear.
Speaker 13: One way an analysts put it to me is power
Speaker 13: bills are going up across the country different different reasons
Speaker 13: and different places. Might be going up in California because
Speaker 13: of wildfire resilience, might be going up in Baltimore because
Speaker 13: of the proximity to Data Center Alley, But power bills
Speaker 13: are going up almost entirely across the country.
Speaker 4: Can I just ask on on nuclear will because this
Speaker 4: is your bag, right, I get that there won't be
Speaker 4: too many new projects coming online anytime soon. Right, you
Speaker 4: were down at the opening of a new nuclear plant
Speaker 4: in Georgia.
Speaker 11: That was last year.
Speaker 12: I know but okay, I remember you talking about it.
Speaker 4: But what about recommission deal, what about decommissioned plants being
Speaker 4: brought back online, like three Mile, like Palisades, Like, how
Speaker 4: many of those are we going to see that will
Speaker 4: increase the nuclear power capacity.
Speaker 14: There is, it's a short list, and almost everyone on
Speaker 14: the list is it's happening now, like the next era one.
Speaker 14: That's the jang Armyl plants in Iowa. We heard about
Speaker 14: that just a little while ago. There are three Mile
Speaker 14: Islands coming on in twenty twenty seven. Palisades is coming
Speaker 14: on January February, and after that. There's just not that
Speaker 14: any that are good candidates. So we're going to hear
Speaker 14: more about the ones. I think people are exploring them.
Speaker 14: There's the VC Summer plant in the Carolinas, So people
Speaker 14: are looking at doing that for everyone that they possibly
Speaker 14: can make an economic case for doing it.
Speaker 11: COO.
Speaker 13: I mean some of the old ones, they cut them
Speaker 13: up and took them away. I went and toward one
Speaker 13: a few years ago in Vermont, a Vermont Yankee plant,
Speaker 13: and that plant was decommissioned when power prices were low.
Speaker 13: We were when we were long power, and I went
Speaker 13: up there and by the time I went up there,
Speaker 13: and I think twenty twenty three, we were starting to
Speaker 13: see some of the increase in power demand. And while
Speaker 13: I was there, I was a little like, you got
Speaker 13: sure you want to cut this up, but I mean
Speaker 13: the process that started it was decommissioned.
Speaker 11: They cut the thing apart.
Speaker 13: It was all taken on special trains to Texas where
Speaker 13: it's buried very deep in the Texas dirt. Because that's
Speaker 13: what you do with radioactive material, can't.
Speaker 5: Texas, I mean, you got to do something with this stuff.
Speaker 11: Can't fire that one back up?
Speaker 5: Hey, guys, thank you so much. Really enjoy this. I'm
Speaker 5: really smart. Joshaw Saul, energy reporter at Bloomberg News. Here
Speaker 5: in our Bloomberg Interactive Broker studio. Will Wait, also energy
Speaker 5: reporter at Bloomberg News.
Speaker 1: Also right here in studio.
Speaker 2: You're listening to the Bloomberg Business Weekdaily Podcast. Catch us
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Speaker 2: second hour of the weekend edition of Bloomberg Business Week,
Speaker 2: including the CEO of Compass Pathways, back with us.
Speaker 1: That's the company behind treating depression and PTSD using silocybin.
Speaker 1: We'll get an update on their route to FDA approval.
Speaker 3: Plus tips on organizing a loved one's of state and
Speaker 3: the perfect time piece gift. Yes, we're talking about watches
Speaker 3: for all types of people in your life. Price tag
Speaker 3: included courtesy of our watch guru, Chris Rouser.
Speaker 1: Had lots of gift ideas off of that one. Hey,
Speaker 1: first of this hour, It's called the Solar Sunbather.
Speaker 5: It has three wheels.
Speaker 1: It looks like it belongs in outer space. It could
Speaker 1: possibly though, hit the roads in twenty twenty six.
Speaker 3: No, it's not a SpaceX tricycle. We're talking about the
Speaker 3: futuristic looking solar powered vehicles behind Aptera Motors. This is
Speaker 3: a California based solar mobility company. It was formed back
Speaker 3: in twenty nineteen. It's in a testing phase to release
Speaker 3: its cars on the roads and select states next year.
Speaker 3: For more on the company's plans, Carol and our car
Speaker 3: lover and very serious driver too.
Speaker 1: Yes he is.
Speaker 3: Matt Miller caught up with the co CEO of Aptera,
Speaker 3: Chris Anthony.
Speaker 1: Hey, Chris, good to have you here with Matt and myself.
Speaker 1: I know he's going to take over in one minute
Speaker 1: because he's our car guy or one of our car guys.
Speaker 1: But tell us a little bit about where the company is.
Speaker 1: You're in your what sixth year, tell us about where
Speaker 1: the car is, where you're going, you're on the road,
Speaker 1: you're testing, tell us a little bit about it.
Speaker 15: Yeah, Terara's currently in final validation and we're looking to
Speaker 15: press into full production in twenty twenty six, and it's
Speaker 15: just exciting to see the vehicle come together and see
Speaker 15: solar mobility finally on the road.
Speaker 4: You know, clearly the current zeitgeist is not what you
Speaker 4: would consider pro solar car. The administration seems not to
Speaker 4: be the biggest fan of alternative energy or renewable energy.
Speaker 4: On the other hand, they've given you a ton of
Speaker 4: what I must believe are very incentivizing tax rules in
Speaker 4: the current one big beautiful bill, especially if you're going
Speaker 4: to manufacture in this country, which you are right, Yeah.
Speaker 15: We're manufacturing in Carlsbad, California. But you know, there is
Speaker 15: a global supply chain for vehicles like this, and we
Speaker 15: hope that you know, there's enough investment in the US
Speaker 15: to bring more and more of that supply chain. You know,
Speaker 15: over in time, what are.
Speaker 4: The critical pieces that you need, Like what do you
Speaker 4: need to import and pay tariffs on and what can
Speaker 4: you get from this country in order to build your car?
Speaker 15: You know, initially we partnered with LG. Kim in a
Speaker 15: company called CTNS in Korea to make our battery packs.
Speaker 15: But we're bringing cell manufacture over to Tennessee and bringing
Speaker 15: the equipment over to manufacture our battery packs here in Carlsbag, California.
Speaker 15: So that's been assisted by California Energy Commission grant and
Speaker 15: we hope to have all that production here in the US,
Speaker 15: hopefully by the end of twenty twenty six, maybe twenty
Speaker 15: twenty seven.
Speaker 1: What's the most difficult aspect of what you're doing and
Speaker 1: trying to create a market essentially for it and then
Speaker 1: ramp up, Like what is the trickiest part right here?
Speaker 15: Yeah, you know, most companies start with a minimum viable
Speaker 15: product and transportation. You know, it's kind of about the
Speaker 15: styling of the vehicle and how many cupholders it has,
Speaker 15: how many passengers. That's not really where we started. We
Speaker 15: started with how do we make the most efficient transportation possible?
Speaker 15: And then it became this solar powered masterpiece that we
Speaker 15: have now. But we really didn't know what kind of
Speaker 15: market there was. We weren't able to study the market
Speaker 15: for something that didn't exist, so we kind of had
Speaker 15: to just build what we wanted to bring to the
Speaker 15: world and then hope that people really liked it. And luckily,
Speaker 15: within the first couple weeks of announcing it, we had
Speaker 15: over four thousand orders. Now we have almost fifty thousand
Speaker 15: orders for the app Tarra, and you know, we think
Speaker 15: people are really excited about transportation built for efficiency's sake,
Speaker 15: and something that can be solar powered, something that you
Speaker 15: never have to worry about putting gas in at, something
Speaker 15: you never have to worry about plugging it in.
Speaker 5: Do you have to worry about range?
Speaker 15: The standard version of the app Terra gets four hundred
Speaker 15: miles of range, plus it gets the solar charging that
Speaker 15: it gets every day just by leaving it out in
Speaker 15: the sun. But we do offer larger range models of
Speaker 15: our app Teara up to one thousand miles.
Speaker 4: Of range, so that's easily enough for my daily commute.
Speaker 4: The car looks really, I mean, it looks cool, looks weird,
Speaker 4: looks different, it's a three wheeler. I guess that would
Speaker 4: be so that you can classify it as a motorcycle.
Speaker 4: Correct me if I'm wrong. And you've got these outboard
Speaker 4: fenders on the front, two wheels and then one wheel
Speaker 4: in the back.
Speaker 12: Tell us about the design.
Speaker 16: Yeah.
Speaker 15: You know what most people don't realize is that sixty
Speaker 15: to seventy percent of your fuel that highway speeds just
Speaker 15: goes to pushing air out of the way if you're
Speaker 15: in a typical suv or sedan. So we started, you know,
Speaker 15: with aerodynamics when it comes to making transportation more efficient.
Speaker 15: That's why it looks more like a fish than a box.
Speaker 15: And with something that looks so unique, you also want
Speaker 15: to eliminate any weight you can. So it's very light weight,
Speaker 15: and that made it three wheels, so there's less rolling resistance,
Speaker 15: less weight, and that three wheels has some unique advantages,
Speaker 15: and that we're classified as the motorcycle. But because it's
Speaker 15: three wheels, you don't have to have a motorcycle's license.
Speaker 15: Because you have something over your head, you don't have
Speaker 15: to wear a helmet. And in California, evs are no
Speaker 15: longer allowed. Brought us admission to the HOV Lane the
Speaker 15: High Occupy Vehicle lane, so will be the only EV
Speaker 15: that's able to drive in the HOV lane without it
Speaker 15: your restrictions.
Speaker 16: So that's interesting that you can get You can sort
Speaker 16: of weave through different regulations with a three wheeled vehicle,
Speaker 16: and that's why you've seen some of the coolest experimental vehicles,
Speaker 16: from the Morgan three wheeler.
Speaker 12: To this app Tara car.
Speaker 4: It's got us room for two people inside, right, as
Speaker 4: well as I guess luggage or a pet or whatever
Speaker 4: you want to bring along. What's it like when you're
Speaker 4: driving around? I mean, everybody must be rubbernecking.
Speaker 1: How come you haven't driven one yet?
Speaker 11: Yeah?
Speaker 12: How come I haven't driven one yet?
Speaker 15: Chris, Well, we need to get you in one soon, Matt.
Speaker 15: It's a pleasure to drive. It's super super quiet. It's
Speaker 15: kind of eerily quiet because a lot of the noise
Speaker 15: you hear in a typical suv or sedan is win
Speaker 15: noise buffeting off the vehicle at higher speeds, But because
Speaker 15: the Aptera cuts through the wind so nicely, you don't
Speaker 15: really get a lot of that. So it's very different
Speaker 15: kind of driving experience. It's quick, it's a zero to
Speaker 15: sixty and five seconds top speed one hundred miles an hour,
Speaker 15: and you know, it's definitely something that gets attention if
Speaker 15: you are an introvert to maybe this is not the
Speaker 15: vehicle for you initially because any Starbucks that you pull
Speaker 15: up to you're gonna bring a crowd.
Speaker 4: But you can take it off the beaten path, right.
Speaker 4: I mean, I'm sure I've seen the website because I
Speaker 4: recall pictures of maybe the Aptara on a beach or
Speaker 4: in the woods. It comes with or you can buy
Speaker 4: I guess camping gear or a kit that goes along
Speaker 4: with it so that you can get out there. And
Speaker 4: plus the fact that it's a solar charging you can
Speaker 4: charge with the sun up to forty miles a day, right,
Speaker 4: means that you can really take it off the grid.
Speaker 15: It's a little deceptive on the storage. There's actually thirty
Speaker 15: five cubic feet of storage.
Speaker 8: In the back.
Speaker 15: If you put the front seat forward and the passenger side,
Speaker 15: you have seven feet of space from the tail to
Speaker 15: the tips. You can put surfboards back there, mountain bikes,
Speaker 15: you can actually leave the hatch up, and there's a
Speaker 15: camping kit where there's a tent that goes over the
Speaker 15: back of the vehicle so you can camp to people comfortably.
Speaker 15: But most importantly, it's very cool to think that you
Speaker 15: can drive two hundred miles to your favorite camping spot,
Speaker 15: you can camp for a week, and you can come
Speaker 15: back with more energy in your app tear than you
Speaker 15: left with.
Speaker 5: Unless it rains or no.
Speaker 15: It does get less solar production, you know, if it's
Speaker 15: super cloudy or if it rains. You know, if it's cloudy,
Speaker 15: you can count on maybe half of the energy production.
Speaker 15: You know, if it's a white out snow, obviously you're
Speaker 15: not going to.
Speaker 3: Get much solar.
Speaker 15: But it's really a whole new vehicle category, a vehicle
Speaker 15: that creates its own fuel. There's never been anything like
Speaker 15: it where you purchased the vehicle and you're also purchasing
Speaker 15: a lifetime's worth of fuel with it.
Speaker 1: Yeah. Hey, we're talking with Chris Anthony, Co, chief executive
Speaker 1: officer of Aptera Motors, joining us from Carlsbad, California. You know,
Speaker 1: I mentioned that the company began in twenty sixteen, but
Speaker 1: it's really like an iteration of a company that goes
Speaker 1: back a while. I think going back to actually two
Speaker 1: thousand and six, it was a company. I think it liquidated,
Speaker 1: it came back as a second company, and now it's
Speaker 1: the third company. Or anything like if someone you know, googles,
Speaker 1: it might be like, God, this feels a little uncomfortable.
Speaker 1: Anything that connects you to kind of the history of
Speaker 1: this company from day one.
Speaker 3: Yeah, you know.
Speaker 15: I met Steve Fambreau in two thousand and five. He
Speaker 15: had a vision for how to make vehicles more efficient.
Speaker 15: It was a bit perplexed that there are some vehicles
Speaker 15: on the road that you would think should be efficient.
Speaker 15: You know, things that look aerodynamic. You know a VW bug.
Speaker 15: Why doesn't that get more than fifty miles per gallon?
Speaker 15: It really all comes down to the aerodynamic losses, the
Speaker 15: weight losses. So how would you make the most efficient
Speaker 15: vehicle possible? And that's what Steve and I set out
Speaker 15: to bring advanced engineering too, is if you really tackle
Speaker 15: the problem from a first engineering principles perspective, and what
Speaker 15: do you end up with? You end up with a
Speaker 15: vehicle looks more like a fish. It's about two thousand pounds,
Speaker 15: it has three wheels, and it has an electric power train.
Speaker 15: That's the most efficient way to get energy to the wheels.
Speaker 15: You know, by happenstance. We created something that it's some
Speaker 15: three hundred and fifty miles per gallon equivalent, and when
Speaker 15: you do that, you can put a relatively small solar
Speaker 15: package on top but get really useful range. We get
Speaker 15: about forty miles a day of free power just from
Speaker 15: leaving the app tear out in the sun. So if
Speaker 15: you're like the average American and you only drive thirty
Speaker 15: miles a day, forty miles a day of solar charging
Speaker 15: is great. You just never have to plug the vehicle in,
Speaker 15: You just leave it outside and takes care of all
Speaker 15: your average driving needs.
Speaker 1: So, Chris, is this something that you really see for
Speaker 1: local driving? I'm curious if it taps out at sixty
Speaker 1: five miles an hour or is it?
Speaker 11: Does it?
Speaker 1: How fast can it go and can it be on
Speaker 1: highways or what's your vmax?
Speaker 8: Dude?
Speaker 5: Thank you?
Speaker 11: Yeah, you're.
Speaker 15: The suspension handling characteristics are great. You know, it's a
Speaker 15: very spirited drive zero to sixty and five seconds, but
Speaker 15: you're actually faster, you know, at the upper ends of
Speaker 15: the speed. You know, thirty to sixty you know is faster,
Speaker 15: and a top speed of one hundred miles an hour.
Speaker 15: So definitely driving it on the highway. It's made to
Speaker 15: be a southern California vehicle. You know, lots of sun
Speaker 15: out here. It's made to be more than, you know,
Speaker 15: just a commuter vehicle. You can you know, take it
Speaker 15: and you know, do the family shopping. You can you
Speaker 15: pick up the kids from the school. You can do
Speaker 15: a lot with this vehicle. In terms of usability.
Speaker 4: I also see that it can fit individuals of up
Speaker 4: to six foot eight, which is important for.
Speaker 14: Me because you're six want I'm six four, but I
Speaker 14: want six.
Speaker 12: I need leg room, right, I don't.
Speaker 4: I get claustrophobic and normal cars and planes, so I
Speaker 4: need my space. And by the way, as you're to
Speaker 4: sixteen five seconds, when I was in college, that was
Speaker 4: what a nine to eleven was doing. So that's respectable,
Speaker 4: really respectable. I mean there's still a lot of cars
Speaker 4: that can't do that. Of course, you got the instant
Speaker 4: torquere getting up to one hundred miles an hour. I
Speaker 4: rarely exceed that speed when I'm driving to and from work.
Speaker 12: I try to come close when there's nobody around. How
Speaker 12: many orders have you got for this?
Speaker 4: I mean, how many people do you think you're going
Speaker 4: to sell this car to when it goes into final production.
Speaker 5: Justus twenty seconds.
Speaker 15: Yeah, we've got almost fifty thousand orders, but we hope
Speaker 15: to deliver up to a million Appteara in the next
Speaker 15: ten years. It took Tesla thirteen years to deliver their
Speaker 15: million vehicles. We hope to do it in ten.
Speaker 1: Well, I can't wait for Matt to try it out
Speaker 1: and report back, and then you can come back on
Speaker 1: with us. Chris Chris Anthony, co CEO of Epterra Mortars
Speaker 1: joining us.
Speaker 2: This is the Bloomberg Business Week Daily Podcast. Listen live
Speaker 2: each weekday starting at two pm Eastern on Apple car
Speaker 2: Play and Android Auto with the Bloomberg Business App. You
Speaker 2: can also listen live on Amazon Alexa from our flagship
Speaker 2: New York station, Just Say Alexa played Bloomberg eleven thirty.
Speaker 1: Well, remember when we couldn't stop talking about psychedelics and
Speaker 1: their potential use for treating a range of related mental
Speaker 1: and physical health conditions. Well this was during and just
Speaker 1: after the pandemic. But then in twenty twenty two we
Speaker 1: saw prices collapse. Money was pulling out investors off, and
Speaker 1: trial results weren't what they needed to be Well, it's
Speaker 1: now having a resurgence.
Speaker 3: Just this year, US Health and Human Services Secretary Robert F.
Speaker 3: Kennedy Junior said he could envision approval for psychedelic drugs
Speaker 3: as treatment for depression and trauma if clinical studies have
Speaker 3: been conducted. Plus Bloomberg Intelligence analysis estimates that the market
Speaker 3: could grow to seven billion dollars in sales by twenty
Speaker 3: thirty two. Analysts say that market potential quote is clear,
Speaker 3: but companies could still run into issues with regulators and
Speaker 3: in scaling up.
Speaker 1: Yeah, still not a straight path forward. Hey back with
Speaker 1: an update though, on his company's path two FDA approval
Speaker 1: for some of the psychedelic treatments we put up with
Speaker 1: Kabir Noth. He's chief executive officer of the small cap
Speaker 1: five hundred and fifteen million dollar market cap company Compass Pathways.
Speaker 1: Kaber joined us alongside Alexis Christopherus, who was filling in
Speaker 1: for Tip.
Speaker 17: So we're excited about the fact that we're now in
Speaker 17: a position to potentially accelerate getting this medicine to patients
Speaker 17: who so urgently needed. Let me remind that there are
Speaker 17: three million patients living with persistent depression in the US.
Speaker 17: Fewer than five percent of them today are treated with
Speaker 17: a medicine that was actually specifically studied for or is
Speaker 17: approved for treatment resistant depression. And this is depression that
Speaker 17: is chronic, it's refactory. Often people are unable to work.
Speaker 17: It has dramatic direct healthcare costs in terms of costs
Speaker 17: of emergency room admissions in psychiatric care, but it also
Speaker 17: has real social costs for these people. So what's changed
Speaker 17: is we've had a really excellent conversation with the FDA
Speaker 17: about their desire to see subject to us to continuing
Speaker 17: to produce really strong results in terms of efficacy and safety.
Speaker 17: Their desire to see this moved more quickly. We've completed
Speaker 17: the enrollment in our second final stage study, which we
Speaker 17: did ahead of expectations, which is really down.
Speaker 5: To the great Phase three.
Speaker 17: This is a Phase three. This is the second of
Speaker 17: our final stage studies. We've completed the enrollment of that.
Speaker 17: We expect to have the the primary data from that
Speaker 17: in first quarter of next year. That will give us
Speaker 17: the second of our final stage studies. And with that
Speaker 17: we are actually excited to be able to submit that
Speaker 17: to the agency and look to an accelerated approval.
Speaker 5: Wow, that sounds like a really big move.
Speaker 1: I'm curious just remind us and we were talking with
Speaker 1: our healthcare team, how you guys designed the trials or
Speaker 1: research program to avoid some of the pitfalls that we've
Speaker 1: seen with I think about the ecstasy and the mm
Speaker 1: MDMA drug application that was for PTSD. How did you
Speaker 1: guys avoid some of those pitfalls.
Speaker 17: So first we had the opportunity to learn from some
Speaker 17: of the lessons. We've been in an excellent dialogue with
Speaker 17: the FDA now for some six or seven years since
Speaker 17: we first started this time, since this process, Yeah, as
Speaker 17: we know drug developing new medicines takes a long time
Speaker 17: on a lot of commitment. Yeah, we've done this in
Speaker 17: a very robust and rigorous way. We are collecting full
Speaker 17: side effect data. We're collecting all the issues, not just
Speaker 17: your potential side effects such as headache and fatigue, which
Speaker 17: are transient, but also things like king and so on,
Speaker 17: to make sure that there is really no abuse potential
Speaker 17: for this, and we've been collecting that right from this.
Speaker 5: Is there any abusive potential for this?
Speaker 17: There is no history in psilocybin of people actually seeking
Speaker 17: it out or of any abuse potential with psilocybin, which
Speaker 17: is an important point.
Speaker 10: I'm putting my investor hat on for a moment, and
Speaker 10: I need to ask you about intellectual property and how
Speaker 10: you handle something like that, because psychedelic compounds don't sort
Speaker 10: of fit comfortably into that compound if you will, because
Speaker 10: a lot of them are natural, they can't really be
Speaker 10: patented if you will. So how do you deal with that?
Speaker 10: And to what extent is your medicine? You know, hold
Speaker 10: patents or have intellectual property.
Speaker 17: So our medicine comp. Three sixty is a fully synthetic
Speaker 17: formulation of psilocybin. Okay, we have polyfomorph patents that address that,
Speaker 17: and therefore we have robust protection till twenty thirty eight,
Speaker 17: with the potential for extension around that because again we
Speaker 17: went for a fully synthetic modern medicine.
Speaker 1: Have you talked to direct with the Health and Human
Speaker 1: sec Secretary Robert F.
Speaker 5: Kennedy.
Speaker 17: We are focused on an excellent relationship with the psychiatry
Speaker 17: division of the FDA. Okay, we've been working with the
Speaker 17: same folks for seven years.
Speaker 1: We have certainly made some commentary around this that has
Speaker 1: given you hopes and expectations that this would move along
Speaker 1: more rapidly.
Speaker 17: We're happy that there are senior figures in the administration
Speaker 17: who believe like us in the potential for psychedelic therapy.
Speaker 17: But we're really focused on delivering the right efficacy and
Speaker 17: safety through our studies and working directly with the division
Speaker 17: that's going to approve US.
Speaker 10: SO Trial three third phase next year. Early next year,
Speaker 10: give us an idea of a timeline. I mean, when
Speaker 10: might we see something like this come to market.
Speaker 17: We will get the primary data, as I said, in
Speaker 17: first quarter of next year. We will need to submit
Speaker 17: some more data later in the year, but we are
Speaker 17: looking forward to being in a position to complete a
Speaker 17: submission to the FDA in the latter part of next year,
Speaker 17: and then we'll work with them as expeditionally as possible
Speaker 17: on a potential regulatory approval.
Speaker 1: SO twenty twenty six, twenty twenty seven, Like, what's I know,
Speaker 1: this stuff all takes long, and I know we constantly
Speaker 1: am asking you, but I think because it's been so
Speaker 1: much out there for a while, a decade and then
Speaker 1: some right, I think we're all trying to do, certainly
Speaker 1: for an investing audience, understand when this actually hits the market.
Speaker 17: We are preparing to be ready for a commercial launch
Speaker 17: from the end of twenty twenty six.
Speaker 10: Ah, you said it, well, thank you.
Speaker 5: What is something like this? What is something like this cost?
Speaker 10: That's the question.
Speaker 17: So it's premature to discuss the pricing for this in
Speaker 17: the moment. First, we actually still need to see some
Speaker 17: of the longer term results from our studies. In particular,
Speaker 17: we need to see over the course of the first
Speaker 17: six months, what the potential for a second dose is
Speaker 17: and really therefore how many potential sessions that a patient
Speaker 17: may need to have in a given year.
Speaker 10: That's a great question because you're talking sessions. So this
Speaker 10: is not a drug that someone would continue to take
Speaker 10: or a lifelong sort of drug, if you will.
Speaker 17: Absolutely, and it's a really important point there. What we
Speaker 17: have shown in our studies so far is that a
Speaker 17: single session can produce a dramatic response that lasts for
Speaker 17: six weeks. Today, either it's a daily oral or there
Speaker 17: is a product esketomy which you will need to take
Speaker 17: maybe thirty to fifty times a year. What we are
Speaker 17: showing is truly transformative. Therefore for these patients with this
Speaker 17: infrequent session.
Speaker 1: So we're talking with Kabir or notth He's chief executive
Speaker 1: officer of Compass Pathways ticker is CMPs. He's here in
Speaker 1: our Bloomberg studio, Bloomberg headquarters, Kair. One of the things
Speaker 1: I think about then, is if all goes as you anticipate,
Speaker 1: and you've talked about the market for like who this
Speaker 1: is for specifically, then do you move on to other
Speaker 1: uses and other treatments, whether it's PTSD, whether it's drug addiction, Like,
Speaker 1: I'm just curious how far you can go with this.
Speaker 17: Yes, thank you, Carol, And we are designing have in
Speaker 17: fact already designed and finalized the design of a study
Speaker 17: in PTSD. PTSD affects thirteen million people in America, and
Speaker 17: while there's this view that it's prevalent among veterans and
Speaker 17: so on, it absolutely is that's actually only around fifteen
Speaker 17: percent of that.
Speaker 11: Population, only fifteen percent fifteen.
Speaker 17: Percent, actually sixty percent of people suffering with PTSD are women,
Speaker 17: and so this is a very large population. The only
Speaker 17: two drugs medicines approved for PTSD were approved in the
Speaker 17: last century, so this is something new, something different, and
Speaker 17: so we are very excited about that we have designed
Speaker 17: a study and that we will be kicking that off
Speaker 17: next year.
Speaker 10: I want to go back to the question of price.
Speaker 10: So what about insurance and how does that play a
Speaker 10: part in all of this?
Speaker 17: From the get go, Compass were set up in order
Speaker 17: to ensure broad and equitable access for patients, and that
Speaker 17: means the ability to work with insurers, both commercial and government.
Speaker 17: With the data, we've already shown, as I say, a
Speaker 17: single administration producing statistic significant result reductions in depressive symptoms
Speaker 17: after six weeks, we've already started to demonstrate the value
Speaker 17: that this.
Speaker 3: Can bring to the healthcare system.
Speaker 17: Patients living with persistent depression frequently end up in the
Speaker 17: emergency room. They sometimes have in patient's psychiatric care. There
Speaker 17: are direct costs to healthcare systems, and we have already
Speaker 17: started to demonstrate the value.
Speaker 5: You know, and forgive us Kamiir.
Speaker 1: We do keep going back to I know you can't
Speaker 1: talk about price or your guys are figuring that out.
Speaker 1: But we kicked off saying, according to our Bloomberg intelligence
Speaker 1: team that this market psychedelic drug development could go to
Speaker 1: seven billion dollars in sales by twenty thirty two. How
Speaker 1: much of that do you think is or how much
Speaker 1: of that market size do you think you could get?
Speaker 5: And I'm just trying to I'm curious.
Speaker 17: So we have the potential to be ahead of other
Speaker 17: companies in this market by two to three years, and
Speaker 17: we're excited about the opportunity to treat lots of patients.
Speaker 17: So for us, this is about the ability to make
Speaker 17: inroads into those three million patients that need a new
Speaker 17: treatment option. The only medicine that's actually approved and is
Speaker 17: being really promoted for this population today is treating maybe
Speaker 17: seventy to one hundred thousand patients, so that population of
Speaker 17: three million, So what we're excited about is the ability
Speaker 17: to bring this new medicine to those patients.
Speaker 5: Is it a billion dollar DOUG drug? Would you anticipate We.
Speaker 17: Would hope that if we can successfully treating.
Speaker 11: A large number of.
Speaker 1: Patients, especially if you get and you expand out, do
Speaker 1: you go for other uses?
Speaker 5: Yeah? Do you go alone?
Speaker 11: That's our intention.
Speaker 17: We've always said clearly that we believe that we can
Speaker 17: do this on our own in the US market, and
Speaker 17: that's our intention.
Speaker 10: All right, What about side effects? I mean, folks are
Speaker 10: listening to this, A lot of folks are hoping that
Speaker 10: this is all going to work and come to market
Speaker 10: sooner rather than later. What are some of the side
Speaker 10: effects though.
Speaker 17: So on the day of dosing, there's some headache, some nausea,
Speaker 17: and that passes by the second day at most, because
Speaker 17: this is a day in a treatment center. We have
Speaker 17: a fully independent group of scientists and clinicians that reviews
Speaker 17: all our safety data on a regular basis. They have
Speaker 17: access to data from all arms of our studies and
Speaker 17: they have seen no unexpected or concerning side effects.
Speaker 8: That have caused them to alter the course.
Speaker 17: Of the study in any way.
Speaker 1: And just remind everybody, and we just got about forty
Speaker 1: seconds co here. Right when it is given to a patient,
Speaker 1: there are folks around to really watch the process, make
Speaker 1: sure things go.
Speaker 10: You're not taking this into the bathroom by yourself.
Speaker 17: This is very much delivered in a safe environment, in
Speaker 17: a medical environment, with somebody in the room who is
Speaker 17: medically trained, who's there just to assure patient safety and comfort.
Speaker 5: Do you see the finish line.
Speaker 11: I absolutely do. And we're excited about that potential.
Speaker 1: I just think how long we've been reporting on it
Speaker 1: and talking about it. It's really fun to kind of
Speaker 1: be on this journey.
Speaker 5: I'm just with you.
Speaker 10: I'm just wondering quickly regulatory hurdles in twenty twenty six.
Speaker 10: Do you think that it is going to be a
Speaker 10: more friendly regulatory environment with the Chiatry division.
Speaker 17: We have an excellent relationship and that's been consistent of
Speaker 17: a six seven years, and we expected that to come.
Speaker 1: Yeah, it sounds like you've been talking to them for
Speaker 1: a long long time. Kabir, Thank you, Nice to have
Speaker 1: you in studio. Kabir not his chief executive officer of
Speaker 1: Compass Pathways joining us right here.
Speaker 2: This is the Bloomberg Business Week Daily Podcast. Listen live
Speaker 2: each weekday starting at two pm Eastern on Applecarplay and
Speaker 2: Android Auto with the Bloomberg Business App. You can also
Speaker 2: listen live on Amazon Alexa from our flagship New York
Speaker 2: station Just Say Alexa played Bloomberg eleven thirty.
Speaker 1: Over the next couple of decades, an estimated ninety trillion
Speaker 1: dollars in assets will be passed down from the Silent
Speaker 1: generation and Baby Boomers to their Gen X and millennial airs.
Speaker 1: But this so called great wealth transfer has a confounding corollary.
Speaker 1: Our parents haven't just been accumulating money, They've also been
Speaker 1: accumulating stuff, so much stuff, so writes Bloomberg Pursuits Editor
Speaker 1: at Large Chris Rouser.
Speaker 3: With us on tips on what to keep, sell and donate,
Speaker 3: and just the concept in general, the history of it,
Speaker 3: why as Americans and when we started collecting so much stuff?
Speaker 3: Is Chris Rouser. Chris's story is The Pursuit's cover story
Speaker 3: of the December issue of BusinessWeek magazine. It's available now online,
Speaker 3: on the terminal and on newsstands. I kind of want
Speaker 3: to start with PEZ dispensers, because that's how you start
Speaker 3: the piece. But this was a great piece, Chris. It's
Speaker 3: not just for people who have elderly people in their
Speaker 3: lives with a lot of stuff. It's also if you
Speaker 3: have a lot of stuff in your life, you can
Speaker 3: take a lot away because there's a lot tied up
Speaker 3: in physical things, memories, just feelings holding on to things, history, fear. Yeah,
Speaker 3: it's really complicated.
Speaker 18: It's very complicated. So starting with Pez, which is a great.
Speaker 3: Which is a great place to start.
Speaker 18: Nick Malice is a comedy writer in la who I
Speaker 18: encountered while reporting for this story, and his had these
Speaker 18: two great, big lofts and soho in New York. Sounds
Speaker 18: very glam but they were filled with stuff and it
Speaker 18: was a range of stuff that was like a little junkie,
Speaker 18: Like she would pick up shelves from the street and
Speaker 18: bring him into her apartment and then fill them with stuff.
Speaker 18: But a lot of that stuff was really good, Like
Speaker 18: she was an avid collector. She had like partied with
Speaker 18: Andy Warhol. She had some really good pop art. And
Speaker 18: Nick had to go through these two apartments that were
Speaker 18: jammed to the ceilings, and it took him years, and
Speaker 18: he found, throughout all of his exploration and dealing with it,
Speaker 18: ten thousand pez dispensers. Oh my god, you think that,
Speaker 18: like your parents have a lot of stuff. His mom
Speaker 18: had a ton of stuff, and it was very difficult
Speaker 18: to deal with. As I said, it took years, but
Speaker 18: throughout the process and he found that it actually brought
Speaker 18: him closer to her, going through all of her stuff
Speaker 18: and taking the time and learning about what she cared
Speaker 18: about and all the cool stuff that she left to
Speaker 18: him as his inheritance. So I went into this story thinking,
Speaker 18: all right, well, this is a problem that like we're
Speaker 18: all annoyed about, like both our parents' generations, my generationserations below.
Speaker 18: But also there's like there can be some upsides and
Speaker 18: there can be some beauty to it. So let's go
Speaker 18: in with a positive attitude.
Speaker 5: Well, I love what he said that in going through it.
Speaker 1: I'm sure he was incredibly overwhelmed at the beginning, right,
Speaker 1: but then understanding like as he went through them, like
Speaker 1: he got a better feeling about his mom, yeah, and
Speaker 1: who she was.
Speaker 18: And the key thing that Nick did, which everyone should
Speaker 18: consider doing, is he got help. He got his friends
Speaker 18: to come in and help. He paid people to come
Speaker 18: in and sort the best dispensers. He got someone from
Speaker 18: Antique's road show to look at that really good stuff.
Speaker 18: There's different tiers of help. But you can get an
Speaker 18: organizer to come in and do everything. You can get
Speaker 18: a junk company to come and get rid of everything,
Speaker 18: or you can go through stuff if you really want
Speaker 18: to and sort of set it up into different categories
Speaker 18: like valuable, not valuable, whatever.
Speaker 3: But a key thing is is help.
Speaker 1: I have to say, like both my parents have passed away,
Speaker 1: and I remember my mom was quite the collector. And
Speaker 1: it was Humbles, it was Gompere, it was Deal, it
Speaker 1: was a lot of stuff. Humbless are classic, and I
Speaker 1: just remember going through stuff and there was a point
Speaker 1: where we got so tired of going through stuff, like
Speaker 1: we were just putting stuff out on the curb, and
Speaker 1: in the process we threw out a clock that was
Speaker 1: actually pretty valuable, but we just were just so overwhelmed.
Speaker 1: So how do we kind of go, like, talk to
Speaker 1: us a little bit about the experts that are out
Speaker 1: there that help us with this process to figure out
Speaker 1: what's valuable, what do you keep, what do you pass on,
Speaker 1: what do you throw out?
Speaker 18: Yes, so there is a whole cottage industry that's set
Speaker 18: up to deal with exactly with this. Some people call
Speaker 18: it generational decluttering, which is not only when people are
Speaker 18: passing stuff down to the next generation, but maybe they're
Speaker 18: just downsizing because they retired, they don't need so much space,
Speaker 18: and they don't know what to do. So you can
Speaker 18: get an organizer who will really help you go through everything.
Speaker 18: They'll give you organizational tools, which we all need. They'll
Speaker 18: help you digitize photos. They have all these tools that
Speaker 18: like you don't even think about that will shrink the
Speaker 18: stuff that's in your house and they'll get this stuff
Speaker 18: out of your house. And these are people who are
Speaker 18: practiced at it. They're emotionally sensitive. I talked to some
Speaker 18: really cool people who have are really thoughtful, and it's
Speaker 18: hard to get stuff out of the house. You know people,
Speaker 18: you know, our parents, their parents were depression era, so
Speaker 18: they wanted to hold on to stuff. They want to
Speaker 18: hold onto paper records.
Speaker 1: Going to dacist because I think I think about, like
Speaker 1: why the heck do I I've actually talked about this
Speaker 1: with my therapists, like why do I have to hold
Speaker 1: on to so much stuff? Yeah, like even after my
Speaker 1: parents are passed, like it's like these aren't them anymore,
Speaker 1: but it's like silly things like even seeing their handwriting,
Speaker 1: Like why, But what is it about that we got
Speaker 1: to this point.
Speaker 18: It's a lot of things. So, like I said, our
Speaker 18: parents grew up with depressionary.
Speaker 1: Our parents.
Speaker 18: If you're like an aging millennial gen X, you grew
Speaker 18: up in a house where like people saved stuff against
Speaker 18: maybe future emergencies, like maybe your parents had nine flashlights
Speaker 18: in a drawer because like, you never know when you're
Speaker 18: gonna need it. Anyone younger than us, younger than thirty five,
Speaker 18: grew up with Amazon, so they are you know, and
Speaker 18: they grew up with the Internet, so they are everything
Speaker 18: is immediately available. Things are not as high quality as
Speaker 18: they were, like products, home products, especially as they used
Speaker 18: to be or as beautiful from like the early twentieth century,
Speaker 18: so they don't have that association of this is nice,
Speaker 18: we should keep it, whereas our parents and even us, like,
Speaker 18: it's hard for me to get rid of books.
Speaker 11: I feel like books should have a future.
Speaker 5: Yeah, have you seen my desk.
Speaker 1: I can't get rid of books.
Speaker 3: Oh, I've changed my thoughts completely on books.
Speaker 5: I know you have.
Speaker 3: You got to get rid of books. Everything's on my kindle.
Speaker 3: It just we live in New York City. There's not
Speaker 3: enough room for books. Do it all on your kindle
Speaker 3: and be done with it. Yeah, I mean I know
Speaker 3: it closed too.
Speaker 1: Can I just say though I thought it was interesting.
Speaker 1: I just was say, like the china collection and then
Speaker 1: the china cupboards. I remember my grandmother like a massive
Speaker 1: and then my mom had them, and it's like I
Speaker 1: have little ones. But it's it's like getting away from
Speaker 1: that that that you had these things then you displayed them.
Speaker 18: Yes, and that is that's a thing. When the middle
Speaker 18: class in America was born, and like starting in the
Speaker 18: mid nineteenth century, that when we started having factories and
Speaker 18: middle managers and all these people going in through the
Speaker 18: beginning of the twentieth century, That's when Tiffany started making silver.
Speaker 18: That's when people could afford it was either before that
Speaker 18: it was either like extremely rich people or working class. Right,
Speaker 18: and then there were oh, mass produced things could be
Speaker 18: actually beautiful and we could own a lot of them,
Speaker 18: and we should display them to show like where we
Speaker 18: have reached as a family. And then that created this
Speaker 18: like snowball of like we should show our China, we
Speaker 18: should have fine silver that we don't use, that goss
Speaker 18: us where we are today.
Speaker 3: I love the dive into the industrial revolution in this
Speaker 3: piece and really what brought the American middle class on
Speaker 3: our obsession or fascination with stuff. What I also love
Speaker 3: about the piece, Chris, is it required some self reflection
Speaker 3: from you and also some anecdotes from you about this
Speaker 3: happening while you were essentially thinking about this piece. Talk
Speaker 3: to us about your dad's gun collection.
Speaker 18: So my dad's gun collection was the reason why I
Speaker 18: thought of this piece. Actually, my dad has something like
Speaker 18: seventy guns he'd been collecting since he was a kid.
Speaker 18: So some of them are historical, some of them had
Speaker 18: a lot of emotional resonance, and he has a room
Speaker 18: in his house that we call the Second Amendment rooms
Speaker 18: full of guns, and my brother and I live in
Speaker 18: the city, in New York City, we don't want a
Speaker 18: lot of guns around.
Speaker 3: Well guns are not there as certain guns. It's very
Speaker 3: hard to legally have a gun in New York City.
Speaker 18: Yeah, and also a lot of them are hunting rifles
Speaker 18: and I don't hunt a lot. So my dad decided,
Speaker 18: he was like, you know what, I don't. I'm mostly
Speaker 18: just cleaning these, like I don't really use a lot
Speaker 18: of them that much, and it's time for me to
Speaker 18: get rid of them so my kids don't have.
Speaker 11: To deal with it.
Speaker 18: So he I was so proud of him. He photographed
Speaker 18: all of them. He made like a PDF. He put
Speaker 18: out an RFP to dealers to be like, who will
Speaker 18: give us me the best offer on this? All throughout
Speaker 18: New England. He lives in Maine, and then a guy
Speaker 18: at the Kittery Trading Post in southern Maine was like,
Speaker 18: this is my offer, and my dad said, that's great,
Speaker 18: And he asked my brother and my step siblings which
Speaker 18: guns we wanted, and then he just sold all the
Speaker 18: rest of them the guy at the Kittery Trading Post
Speaker 18: and I was like, this is amazing. I love this
Speaker 18: and so I told my mom and she was like, wow,
Speaker 18: that's awesome. What about all the wooden mallards.
Speaker 3: What's the market collected? Yeah, my dad, what's the market?
Speaker 3: What's the market for wooden mouth?
Speaker 11: So there is a.
Speaker 18: Market for wooden mallards, and there are markets for all
Speaker 18: these things. You think no one wants to silver, and
Speaker 18: you think no one wants china, and that's like in
Speaker 18: brown furniture, and that's sort of true. But like the
Speaker 18: elite stuff, the best stuff, actually there is still a
Speaker 18: market for it. So like you can, you can go
Speaker 18: through and find the people that want the wooden mallards.
Speaker 18: And I thought, okay, this is something I gotta do
Speaker 18: a story.
Speaker 5: Oh my god, I just I love it.
Speaker 1: I love it.
Speaker 5: I think it resonates for so many of us.
Speaker 1: Well, I'm just going to say, if you go through stuff,
Speaker 1: you might be able to pass it off as get
Speaker 1: gifts this holiday season.
Speaker 12: Yeah, or or if not.
Speaker 1: Actually, in our family we've sometimes done that, like passed down.
Speaker 3: Does anyone in your family have a watch collection.
Speaker 12: I have a little bit of a watch clo.
Speaker 3: Oh okay, well that's a perfect segue, So.
Speaker 1: Tell us about you actually give us a gift guide
Speaker 1: for every specific person in your life when it comes.
Speaker 3: To watching, which is a great way to organize it
Speaker 3: because it's not like, Okay, these are the best watches
Speaker 3: for under three hundred dollars, These are the best watches
Speaker 3: for under a thousand, These are the best watches that
Speaker 3: are one hundred thousand dollars. This is the best watch
Speaker 3: for this person in your life. I love that.
Speaker 18: Yeah, thanks, Yeah, you know, normally I do the price
Speaker 18: point gift GUIDs. This year, I was like, I'm going
Speaker 18: to actually go through specific situations that people have already
Speaker 18: come to me to ask for a gift or for
Speaker 18: a watch for themselves. My nephew recently asked he wants
Speaker 18: like a steel watch to take on job interviews because
Speaker 18: he's going to graduate college. So I recommended a Tiso,
Speaker 18: which is a very reasonably priced brand, really good Swiss watches.
Speaker 18: A lot of people ask me, they're like, I'm buying
Speaker 18: my first serious watch, and I send them to a
Speaker 18: multi brand store where they can look at a lot
Speaker 18: of different watches. They always come back either with a
Speaker 18: Rolex or an IWC, so I recommend some IWC's. One
Speaker 18: of my friends has got a new finance job, and.
Speaker 12: He love this one.
Speaker 18: Everyone in my office wears a different watch every day,
Speaker 18: of course, and I was like, I want to work
Speaker 18: in that office, So.
Speaker 1: Do you not have a watch to where every day different?
Speaker 5: That's what I'm saying.
Speaker 1: I'm thinking you you're on it. The nonprofit lawyer, can
Speaker 1: I just say for a nonprofit lawyer? I was curious about,
Speaker 1: like what you were going to come up with.
Speaker 18: I was not expecting still a lawyer, still a lawyer. True, this,
Speaker 18: it's funny. We actually went through and Felix on my
Speaker 18: team asked chat GBT for the same recommendations, and chat
Speaker 18: GPT came up. I think it must have scraped the
Speaker 18: story because although we don't let people scrape our stuff,
Speaker 18: but because it came up with a lot of the
Speaker 18: same recommendations. And for the non profit lawyer one, it
Speaker 18: came up with the exact same brand, no most class shoota,
Speaker 18: which is very it's like pretty obscure. I was like, CHATCHBT,
Speaker 18: you've been listening, but this is my friend is an
Speaker 18: immigration lawyer in Chicago, an incredible, incredible person, and he
Speaker 18: was like, I want to grown up watch to like
Speaker 18: celebrate my milestones and my marriage but I can't be
Speaker 18: like a crazy rich person watch.
Speaker 1: And so I love this watch. Yeah, I love it,
Speaker 1: really beautiful. But for all you guys out there, if
Speaker 1: you're looking to get something for the woman who wants
Speaker 1: an understated.
Speaker 3: Classic Cardia, that tank wise, it's always the tank.
Speaker 1: It's always the tank.
Speaker 3: All right?
Speaker 5: Do we have to go?
Speaker 1: We have to go, Chris Rouser, never enough time. Thank
Speaker 1: you so much. Happy holidays, So glad we could do that.
Speaker 3: Listen, how did you describe the Cardia tank?
Speaker 8: Oh?
Speaker 18: I said, If you're buying a woman an expensive watch
Speaker 18: and you're not considering a Cardia, you're a lunatic.
Speaker 3: There we go. Amen, Amen, Chris Rouser, Bloomberg Pursuits Editor
Speaker 3: at Large.
Speaker 1: And that wraps up our weekend edition, a Bloomberg Business
Speaker 1: freek from Bloomberg Radio. Thank you so much for joining us.
Speaker 1: I'm Tim Steinbeck and I'm Carol Masser. Have a good
Speaker 1: and safe weekend. Maybe clean out some stuff, just recommending.
Speaker 2: This is the Bloomberg Business Week Daily podcast, available on Apple, Spotify,
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