Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside
Speaker 1: my co host Matt Miller. Every business day, we bring
Speaker 1: you interviews from CEOs, market pros, and Bloomberg experts, along
Speaker 1: with essential market moving news. Find the Bloomberg Markets Podcast
Speaker 1: on Apple Podcasts or wherever you listen to podcasts, and
Speaker 1: at Bloomberg dot com slash podcast. Coming into a lot
Speaker 1: of strategists, a lot of fund managers were saying, get
Speaker 1: ready for increased of volatility, and boy, it seems like
Speaker 1: at least for their first four weeks, they were right. Here,
Speaker 1: we've got a vix north of thirty one, we've got
Speaker 1: read on the screen here today, let's check in uh
Speaker 1: and see what we can expect going forward. Liz Young,
Speaker 1: she's head of investment strategy at so Far. Liz, thanks
Speaker 1: so much for joining us here. I guess one of
Speaker 1: the big issues you know that this market is trying
Speaker 1: to discount is the Federal Reserve. We know they're gonna
Speaker 1: raise rates, but now the question is by how much?
Speaker 1: How quickly? How do you guys think about that? Yeah?
Speaker 1: You know, I think first of all, you have to
Speaker 1: look at what the expectations are right now. And the
Speaker 1: reality of it is, we haven't moved yet, right. The
Speaker 1: Fed hasn't done anything yet, and they also haven't been
Speaker 1: all that clear about what they expect to have to
Speaker 1: do as far as rate hikes go. So it continues
Speaker 1: to be an uncertain and sort of convoluted picture, which
Speaker 1: is why the market is having so much trouble digesting
Speaker 1: it on a day to day basis. I think what
Speaker 1: actually happens is that they start to hike rates in
Speaker 1: spring of this year, but they're going to have to
Speaker 1: wait and see how much it affects things like inflation expectations,
Speaker 1: how much it affects things like the bond market. I
Speaker 1: think everybody's really hung up on how it's going to
Speaker 1: affect the equity market. But they're probably going to watch
Speaker 1: the bond market closer and then decide how much further
Speaker 1: they need to go with hikes through the rest of
Speaker 1: the year, so they'll remain basically data dependent UM, but
Speaker 1: I wonder how much they will care about they market.
Speaker 1: We were UM interviewing Greg Jensen from UM Bridgewater the
Speaker 1: other day and he said he thinks right now that's
Speaker 1: really not their main concern. In fact, um, the equity
Speaker 1: market they're probably a lot of speculative bubbles that have
Speaker 1: been blown up there that the Fed wooden't mind seeing
Speaker 1: deflated a little bit. Yeah, you know, I don't know
Speaker 1: that they're tasked with necessarily worrying about the speculative bubbles,
Speaker 1: but I would agree that they're not seeing the equity
Speaker 1: market as their first priority. And I said this on
Speaker 1: a show earlier this week. The Fed doesn't care about
Speaker 1: our feelings anymore, and I think that that's going to
Speaker 1: be the case. And you know, the equity market last year,
Speaker 1: we're looking at the SMP, it made seventy new all
Speaker 1: time highs. That's a pretty good place to come into
Speaker 1: the year on. So we can afford a pullback here.
Speaker 1: And the Fed's main mandate is to control prices, maintain
Speaker 1: stable prices, and maximum employment. So those are priorities number
Speaker 1: one and number two. The employment boxes all but checked,
Speaker 1: and now we're on two prices. Obviously there's an inflation
Speaker 1: problem that they need to deal with. I think that
Speaker 1: they're going to let the equity markets see volatility and
Speaker 1: they're not going to react to that unless it starts
Speaker 1: to threaten financial stability, which again ends up actually being
Speaker 1: more about the bond markets and the equity market. So
Speaker 1: what do you think we might see that the ten
Speaker 1: years it's gonna hit two percent before it hits one
Speaker 1: point five percent. How do you think about that, Liz? Yeah,
Speaker 1: you know, well, we've seen a huge run up in
Speaker 1: the ten year already this year, at thirty basis points
Speaker 1: since the beginning of the year, and that's pretty swift,
Speaker 1: which I think is another reason why the equity market
Speaker 1: is seeing so much of volatility. It has trouble with
Speaker 1: big spikes and yields. But I do think we could
Speaker 1: touch too. I think we could get above two and
Speaker 1: actually get even closer to two and a quarter before
Speaker 1: things sort of level out. Now we might have a
Speaker 1: little bit of a pause here because now the interesting
Speaker 1: part is we're in this waiting period. We're not going
Speaker 1: to hear from the Fed again until March sixteenth, and
Speaker 1: that's when everybody expects the first rate hike to happen.
Speaker 1: So there's a long period of time between now and
Speaker 1: then where the market has to kind of tredge through
Speaker 1: this uncertainty, and we might bounce around in a range
Speaker 1: on the tenure. But I think as we get closer
Speaker 1: and closer to rate hikes, you'll see the tenure get
Speaker 1: higher again, and I really do think that we can
Speaker 1: get above two in the first half of the year.
Speaker 1: Do you have any concern that we see I mean,
Speaker 1: I've looked back at rate hikes cycles for the last
Speaker 1: twenty years and you always get um the curve flattening,
Speaker 1: sometimes inverting. Is that a concern here? And do you
Speaker 1: think we'll hit a recession in Well, we've seen flattening
Speaker 1: already in the curve since Poul's statements earlier this week,
Speaker 1: So I think that the spread went from somewhere in
Speaker 1: the eight basis point basis point range down to the
Speaker 1: low sixties. Still pretty far from inverting. But that is
Speaker 1: one of those measures that I think the feed is
Speaker 1: going to watch. They don't necessarily watch the two tens.
Speaker 1: They might watch a shorter term measure versus the tenure,
Speaker 1: but they're not going to want the curve to invert,
Speaker 1: and they're very aware of that dynamic in the market.
Speaker 1: I don't think one or two rate hikes is going
Speaker 1: to invert the curve. But that's why I think, you know,
Speaker 1: the market suggesting that we're going to have five or
Speaker 1: more rate hikes this year is a little ahead of
Speaker 1: itself because that would probably cause an inversion, and I
Speaker 1: don't think the FET is going to do that, so
Speaker 1: they're going to keep their eye on it. I don't
Speaker 1: see a recession coming. I think Jerome Powell has been
Speaker 1: very careful trying to thread this needle, and he's going
Speaker 1: to continue to be careful. The idea is to allow
Speaker 1: the recovery to continue. Uh. One of the ways that
Speaker 1: you allow it to continue is to make sure that
Speaker 1: inflation doesn't get in the way. Liz thirty seconds kind
Speaker 1: of what's your best idea for where to be here
Speaker 1: in this rising interest rade environment? I mean you want
Speaker 1: to look at short duration assets that goes for equities,
Speaker 1: you know, thinking about UM, some of those cyclical sectors,
Speaker 1: some of the dividend payers that are going to do
Speaker 1: well here in the short term with volatility. I'd also
Speaker 1: look at health care for a long term idea. And
Speaker 1: in national I think this is the year where international
Speaker 1: investing has a revival, both in narrative and returns. Alright, Liz,
Speaker 1: thanks so much for joining us. A pleasure having you
Speaker 1: on and UM it's exciting to see what's going on
Speaker 1: at so far as well. So great to get your
Speaker 1: take this morning. Liz Young there, she is the head
Speaker 1: of investment strategy for so Far, and that is a
Speaker 1: business that it's growing. We saw them um get more
Speaker 1: licensed bank over the last week and so um they're
Speaker 1: offering uh, just a huge platform full of products. Uh
Speaker 1: and I guess the kids. It's just it's not just
Speaker 1: the kids anymore. I don't think so. I think I'm
Speaker 1: seeing a lot more about it, and uh, I think
Speaker 1: it's a certainly great option financial services. No, Matt, we
Speaker 1: talk a lot about fintech, financial technology, we talk a
Speaker 1: lot about crypto, but it's just it just seems to
Speaker 1: me that some of the traditional financial institutions are just
Speaker 1: slow to embrace the whole fintech thing. It just feels
Speaker 1: that way to me. I'm not sure that's look at
Speaker 1: look at the so Far exactly right. We're just talking
Speaker 1: to the so Far analyst. But you know, I saw
Speaker 1: the news recently that UBS agrees to buy robo advisor
Speaker 1: wealth Front, uh, kind of a fintech player, for at
Speaker 1: one point four billions. So that kind of gets your attention.
Speaker 1: But I'm gonna get a sense of how some of
Speaker 1: these traditional financial institutions are thinking about embracing and investing
Speaker 1: in financial technology. You can talk about that with Robin Vince,
Speaker 1: vice chair and CEO of Global Market Infrastructure for B
Speaker 1: and Y. Melon. Robin, you've been in the financial services
Speaker 1: industry for decades. You've seen it evolve. Do you feel
Speaker 1: like the traditional banks, financial institutions are fully embracing kind
Speaker 1: of fintech, crypto, some of the new changes in financial services. Well, first,
Speaker 1: it's great to be with you today, Paul and Matt
Speaker 1: um here here are being why Melon, We love the
Speaker 1: show and I'm speaking you to you today from our
Speaker 1: headquarters here in downtown New York City, which is really
Speaker 1: one of the centers of innovation that we've seen in
Speaker 1: the financial world over the course of our history of
Speaker 1: two and thirty seven years. But look to the point
Speaker 1: of old firms versus new we don't see it in
Speaker 1: that binary way. We just view our position at the
Speaker 1: very harder financial infrastructure allowing us to really be an innovator. Look,
Speaker 1: we touch one fifth of the world's investible assets, We
Speaker 1: service a super majority of global institutions, and so we're
Speaker 1: super well positioned at that exact intersection of the trust
Speaker 1: that we have from our franchise and that gives us
Speaker 1: the ability to innovate, and you can see that in
Speaker 1: a in a whole bunch of different things that we've
Speaker 1: been doing. We announced a crypto custody effort at the
Speaker 1: beginning of last year, the effort into e bills that
Speaker 1: we're doing with Verizon. There's just a whole long list
Speaker 1: of things that we're doing. And frankly, we think it's
Speaker 1: a strength to have the established franchise that we do
Speaker 1: today along with that innovation. Sure. I mean, I was
Speaker 1: gonna say in a lot of ways, b n Y
Speaker 1: Melon is on the cutting edge of this stuff. And
Speaker 1: you have been UM leaders. Tom Keane would probably say
Speaker 1: something like on the avant garde, UM, but you don't
Speaker 1: see that much enthusiasm from the rest of the street
Speaker 1: compared to UM where you see it in the city,
Speaker 1: where you see it in Miami. Um, what do you
Speaker 1: think we're gonna we're gonna end up with here? I mean,
Speaker 1: it's not gonna be just old Wall Street banks running
Speaker 1: our finances in the future. So uh, it's going to
Speaker 1: be a best of both worlds. And we welcome the
Speaker 1: competition and frankly, the push that all of these fintech
Speaker 1: and new industry players are really providing into the space.
Speaker 1: But for us, it's about taking that client franchise, we've
Speaker 1: got the trust that we enjoy with our clients and
Speaker 1: then innovating. So let me give you an example. So
Speaker 1: we we announced late last year the industry first collaboration
Speaker 1: with Verizon on real time e builds and payments for
Speaker 1: US retail clients. Now we're America's oldest bank, but we're
Speaker 1: the first bank to do real time payments and real
Speaker 1: time request for payments, which is enabling for the first time,
Speaker 1: real direct, real time payments from a consumer to a business,
Speaker 1: cutting out the interchange fees, cutting out the inefficiency, cutting
Speaker 1: out the environmental negative footprint of paper and fuel. And
Speaker 1: so that's a great example of exactly that type of innovation.
Speaker 1: And I'm gladn't to Fintake that did it. It was us.
Speaker 1: I'm glad you mentioned the environmental aspect because E s
Speaker 1: G has been kind of a buzzword and I'm sure
Speaker 1: there's going to be a lot of greenwashing. But you're
Speaker 1: also pushing for more diversity, to include women in your
Speaker 1: higher ranks to advanced junior bankers. Tell us about that
Speaker 1: push because it's really taken on a lot of meaning
Speaker 1: this year or last year. Yeah, and it really is
Speaker 1: a critical point. We have one of the most diverse
Speaker 1: boards in the industry and we're super proud of that.
Speaker 1: For the fifteenth consecutive year, we received a score of
Speaker 1: a hundred on the Human Rights Campaign Foundations Corporate Equality Index.
Speaker 1: It's the fifth year in the row that BN Y
Speaker 1: Melons included in the Bloomberg Gender Equality Index, and we're
Speaker 1: really proud to be named as one of those firms.
Speaker 1: It's really driving the equity and inclusion, and we're doing
Speaker 1: it at the top, and we're doing it through the organization,
Speaker 1: and it's the only way to be competitive over the
Speaker 1: course of the coming years, as well as being the
Speaker 1: right thing to do. Yeah, Robin, I worked on Wall
Speaker 1: Street for a long time and what I found in
Speaker 1: my experience and then even managing a business here at
Speaker 1: Bloomberg is you know you can bring in if you
Speaker 1: look at the entering analysts class at any investment bank,
Speaker 1: any financement institution UM over the last decade plus, it
Speaker 1: will look very representative of the marketplace. It will have
Speaker 1: a proper diversity UM. But then when you get up
Speaker 1: to the managing director ranks, the partner ranks. That's where
Speaker 1: the you know, the real glaring disparities you kind of
Speaker 1: show themselves. How do you think if an institutions can
Speaker 1: do to kind of improve that trend? Were You're right
Speaker 1: that that is the challenge. Being able to hire full
Speaker 1: range of diversity at the entry level is obviously sort
Speaker 1: of table stakes at this point. It's about development and
Speaker 1: retention and what what goes into development and retention. That's
Speaker 1: ultimately about opportunity training, giving people not only the pay
Speaker 1: but also the interesting problems to solve, and that for
Speaker 1: us is one of the things that we're very proud of.
Speaker 1: We have forty six trillion dollars worth of assets under custody.
Speaker 1: We touched twenty percent of the world's investible assets. We
Speaker 1: put ten trillion dollars of US treasuries through our platform
Speaker 1: every day, and we have this incredible franchise where we're
Speaker 1: proud to call fortune companies, uh, you know, our clients
Speaker 1: and of the top one hundred banks. And so when
Speaker 1: you have that type of relevance and you have interesting
Speaker 1: opportunities and problems for people to solve, that's how you
Speaker 1: retain great people through the life of their careers. Can
Speaker 1: I can I just get your take on the health
Speaker 1: of New York City? UM to finish up, because you're
Speaker 1: involved in civic service here in New York as well,
Speaker 1: and you mentioned at the top, do you think New
Speaker 1: York City is bouncing back from this pandemic with strength?
Speaker 1: With a bank of New York, We're never going to
Speaker 1: bet against New York City. And you know, I sit
Speaker 1: here in our office today in downtown New York and
Speaker 1: of course we're having to all deal with the challenges
Speaker 1: that Macron has presented to us all. But I'm excited
Speaker 1: for the fact that we're going to be welcoming our
Speaker 1: people back to the office in due course. And I'm
Speaker 1: a believer in the fact that the world has changed
Speaker 1: and it won't be five days a week, every day,
Speaker 1: everyone in the office all the time. We're going to
Speaker 1: take advantage of all these learnings that we've had over
Speaker 1: the course of the past couple of years. We're going
Speaker 1: to be a more hybrid organization that's going to go
Speaker 1: back to your prior point about retention. It's going to
Speaker 1: be important for that. But at the same time, being
Speaker 1: in the office some of the time at least together
Speaker 1: and contributing to the vibrancy of the city, but also
Speaker 1: contributing to that sense of culture and community, developing people,
Speaker 1: making them excited to be here. That's ultimately what our
Speaker 1: future looks like. All right, Robin, thank you so much
Speaker 1: for taking the time to join us. To really appreciate
Speaker 1: getting your perspective. Uh boy, long time at Goldman Saxon.
Speaker 1: Now at the Bank of New York, Melon, Robin Vince,
Speaker 1: Vice Chair and CEO of Global Market Infrastructure at b
Speaker 1: n Y Melon, and you know, a good broad perspective
Speaker 1: of financial services, um, and the pivot towards the I guess,
Speaker 1: the embracing of financial technology and in the office. Yeah,
Speaker 1: and in the office, I mean I think you know,
Speaker 1: the city is going to be coming back pretty aggressively
Speaker 1: over the next several weeks and months. We are going
Speaker 1: to talk a little bit about robots, and I will
Speaker 1: uh well, bringing Laura right right now. Um. She is
Speaker 1: a reporter slash producer, UM woman about town out of
Speaker 1: London and uh a friend of mine, I will say. Also,
Speaker 1: one of my good friends from San Francisco is going
Speaker 1: to join us, Ed Ludlow. He covers all things tech
Speaker 1: plus Tesla and Rivian for us. So the e V sector,
Speaker 1: I guess that includes Lucid and Nicola And looking at
Speaker 1: the stocks are they've been under pressure here, boy, they
Speaker 1: have been. And um, why don't we kick it off
Speaker 1: first with Laura because Tesla came out with earnings and
Speaker 1: they were a bit disappointing. Um in that UM, I
Speaker 1: guess the numbers themselves weren't so bad. Um, but the
Speaker 1: production plan doesn't seem to be anywhere near where we
Speaker 1: thought it should be, right Laura, Yeah, that's right, Matt. Well,
Speaker 1: the operational factories in Fremont, California and Shanghai, we learned
Speaker 1: that they've been under producing. The nightmare supply chain crunch
Speaker 1: that Elon Musk tweeted about at the end of last
Speaker 1: year has seemed to become a reality. So we knew
Speaker 1: going into these results right that Tesla had achieved record deliveries.
Speaker 1: It was a record profit in spite of the supply
Speaker 1: chain difficulties that will be ahead. Tesla did, however, maintain
Speaker 1: that delivery target of fi annual growth. And one interesting
Speaker 1: note from Morgan Stanley. They believe the bull case narrative
Speaker 1: hasn't really changed, but it wasn't a spectacular results, as
Speaker 1: we might have hoped, would change the balls minds on Tesla.
Speaker 1: I mean Tesla balls minds cannot be changed, so whatever. Um.
Speaker 1: The interesting juxtaposition to this ed, I think in a
Speaker 1: way is the story that you broke on Rivian now
Speaker 1: compares Rivillian Rivan's current production to that of Tesla when
Speaker 1: they first started. But the idea is these guys have
Speaker 1: it together in a slightly more I guess organized way. Yeah,
Speaker 1: I mean the stocks under pressure. It just hit fifty bucks.
Speaker 1: The more Stark has been crushed, but it's still fifty
Speaker 1: billion dollar company, which in me is shark right, and
Speaker 1: it's largely pre revenue, right. They just started booking revenue
Speaker 1: revenue of these things. But what sources tell me is
Speaker 1: that the end of fourth quarter was tough. You know,
Speaker 1: there were COVID outbreaks at the plant. They had an
Speaker 1: all hands on deck kind of scenario to get these
Speaker 1: pickup trucks, which I'm starting this scene now by the
Speaker 1: way in San Francisco on the streets. Um. And then
Speaker 1: they try to introduce a new product onto the assembly line,
Speaker 1: which they share an assembly line, and you know, production
Speaker 1: really slowed down. So what they did new year's day,
Speaker 1: Boom shut down the assembly line altogether fixed the problems
Speaker 1: restarted on January the nine, and since then they're ramping
Speaker 1: up like massively. You know, it's almost two trucks a
Speaker 1: week um, which is what are they making. They're making
Speaker 1: the R one T and the R N S is
Speaker 1: the S, but the R N S very modest volumes.
Speaker 1: In fact that the company's only publicly discussed that the
Speaker 1: CEO R J. Scarynge and the CFO claim mcdonna have one.
Speaker 1: No one else's publicly, you know, taking delivery of one yet.
Speaker 1: But I'm told they are building sailable vehicles. Sources say
Speaker 1: it's like, you know, a negligible number. So, Laura, what's
Speaker 1: the feeling in the EV marketplace as to boy the
Speaker 1: compety the competitive landscape is really beginning to change chairs.
Speaker 1: We have some of the you know, the big O E. M.
Speaker 1: S is, whether it's Volkswagener or Forward or General Motors
Speaker 1: really ramp up their EV game. What's the feeling about
Speaker 1: how the market share might shake out over the next
Speaker 1: several years. There is a feeling that competition is ramping up,
Speaker 1: and that poses questions long term for Tesla's volume and
Speaker 1: it's and its share price right. Focusing on Europe a
Speaker 1: little bit, Voxwagen. When we think of their total car sales,
Speaker 1: only five of fully electric. There's been a lot of
Speaker 1: hype about Ford recently they're pushing into electrification market shares
Speaker 1: surpassing one billion dollars for the first time. But Tesla
Speaker 1: is still by far the market leader for evs and
Speaker 1: for back trees. So the cyber truck, which I know
Speaker 1: Matt Miller will want to come onto that. What's concerned
Speaker 1: Initially that the new batteries which are more efficient used
Speaker 1: in the cyber truck that was the reason behind the delay.
Speaker 1: Turns out the batteries are fine and tells us planning
Speaker 1: to use those more efficient batteries across all their models.
Speaker 1: So it still has that competitive advantage with technology. I mean,
Speaker 1: the thing is five isn't very little, right. Volkswagen makes
Speaker 1: ten million cars a year, so that's different than Tesla,
Speaker 1: although they really ramped up their production right there. What
Speaker 1: was it add like nine hundred thirty six thousand um
Speaker 1: for the for the full year. That's doing what they're
Speaker 1: doing well and in that sense, but Laura mentions the truck,
Speaker 1: what a huge disappointment on so many levels. I mean,
Speaker 1: first he breaks the window with the bowling ball or whatever. Remember,
Speaker 1: so embarrassing, and but I thought they were going to
Speaker 1: come out with it eventually. Now Ford is going to
Speaker 1: beat them, Rivan is beat them. Looks like Chevy's gonna
Speaker 1: beat that. Everyone's beating the market with the truck. Well, look,
Speaker 1: they just find it that supply chain issues are disrupting
Speaker 1: current production of Model Y Model three. Right, the cash
Speaker 1: cows the profitable vehicles, so they can't justify a product
Speaker 1: launch if they're not able to service and get the
Speaker 1: parts that they need to build volume on existing vehicles. Um,
Speaker 1: but this is a comms issue. Guys like think about
Speaker 1: earning season broadly across the SMP. Beating on the top
Speaker 1: and bottom line hasn't really counted for much the streets
Speaker 1: looking for how strong is the current core to how
Speaker 1: strong is the year? Elon must tweets going into this
Speaker 1: earnings having sort of spectacular announced he doesn't want to
Speaker 1: do Earny schools anymore because he's too busy that he'll
Speaker 1: outline a product roadmap. He goes on the cool and
Speaker 1: does not outline a product roadmap. In fact, he does
Speaker 1: the opposite. Sorry, guys, these products are all on the
Speaker 1: back burner because of supply chain issues. Um, it's a
Speaker 1: comms issue, all right. Ed Ludlow, thanks so much for
Speaker 1: joining us. Ed Lulow, West Coast correspondent for Bloomberg News
Speaker 1: and Bloomberg TV. Produce a law right joining us from London,
Speaker 1: getting the latest on e VS the secrets under some
Speaker 1: pressure here, lots of pieces supply chain issues, competition, but
Speaker 1: you know that Matt Miller's all over it. And I'm
Speaker 1: Nathan Hagar in the Bloomberg room in Washington. We do
Speaker 1: all scream for ice cream and we're very excited to
Speaker 1: bring in the CEO of Dryer's Grand ice Cream, Kim
Speaker 1: Pedal regum with us this morning. Kim, thanks for being here.
Speaker 1: I got the long straw because I'm probably the biggest
Speaker 1: fan of ice cream there is. You don't think so.
Speaker 1: I don't believe that anyone eats more ice cream than me.
Speaker 1: If I eat, are gonna throw down over this a
Speaker 1: pint a night. My wife thinks I'm a diet Yeah,
Speaker 1: I admit I split the pints with my wife. Kim,
Speaker 1: I gotta ask though. You know we're we're coming up
Speaker 1: to this northeaster here, we're racing for a lot of snow.
Speaker 1: What advice do you have for ice cream fans like
Speaker 1: us as we're digging in for the old here? Same
Speaker 1: is perfect for any weather, any occasion. I firmly believe that.
Speaker 1: So I don't think you need to temper it because
Speaker 1: it's cold outside. Uh, you know, put it on vanilla
Speaker 1: hogandah on top of a dessert item might be a
Speaker 1: wonderful way to spend a cold evening. So, um, you know,
Speaker 1: be creative. I've always wondered, you know, I've always wanted
Speaker 1: to start my own ice cream shop. And I could
Speaker 1: use dryers or you know, um, I could be you know,
Speaker 1: I could be a vendor for you What what would
Speaker 1: I do in the winter because people just don't go
Speaker 1: into ice cream shops as much in the winter. And
Speaker 1: I've always wondered, do I do ice cream in the
Speaker 1: summer and then like bagels in the winter or coffee
Speaker 1: in the winter, ice cream in this summer? What do
Speaker 1: you what do you typically see people do with small
Speaker 1: town shops? We see, I mean people eat ice cream.
Speaker 1: You'd be surprised people have ice cream all year round, um,
Speaker 1: which we love for the you know loyalists, we absolutely
Speaker 1: love them are Hogan Dash shops. UM see consumers all
Speaker 1: years round, and so we have you know, seasonal flavors.
Speaker 1: What I would say is, UM, in the winter months,
Speaker 1: try things like Hagan Dash peppermint, bark flavors like that.
Speaker 1: We have pumpkin pie UM flavors with our dryers and
Speaker 1: eat these brands. And in the summer go through a drumstick,
Speaker 1: take your cone and you know, take a walk outside. UM.
Speaker 1: But there is a product for every time of year,
Speaker 1: for sure, Dryer's Grand ice Cream. If I look across
Speaker 1: the portfolio, we've got something for everyone and every occasion.
Speaker 1: Have you thought about UM selling more alcoholic beverages because
Speaker 1: I love a boozy milkshake. UM. I can't remember where
Speaker 1: I first tried a Hummer. I think I was at
Speaker 1: a wedding in Detroit, and uh, delicious way to imbibe.
Speaker 1: But you don't see it much at ice cream shops,
Speaker 1: you don't. We have it. Hogan Dust brand has a
Speaker 1: spirit's collection, so we do have some alcohol infused flavors. UM.
Speaker 1: You know, ice cream is a product, so Dryer's Grand
Speaker 1: ice Cream. When I look at the portfolio and who
Speaker 1: buys our products and loves our products. It's across all ages,
Speaker 1: so you know there's families, kids, older consumers, and so
Speaker 1: we do have spirits products, um. And you can certainly
Speaker 1: mix and make your own. If you look online and Pinterest,
Speaker 1: you'll find lots of recipes for Outshine fruit bars in Champagne.
Speaker 1: They're just delicious. Um. So if that's what you're interested in,
Speaker 1: there their recipes and all. If that's where, that's where. Um.
Speaker 1: All right, So Kim, if I go to a store
Speaker 1: and I go to the ice cream, all am I
Speaker 1: going to find product? There? Are you guys seeing supply
Speaker 1: chain issues like seemingly every other business is. So I
Speaker 1: will say we I'll start with kind of a broad statement,
Speaker 1: but I really mean it. We have no plans of
Speaker 1: flowing down at dryers Grand ice Cream. So while the
Speaker 1: world around us, you know, there are supply chain challenge
Speaker 1: us for sure, we have spent the last year to
Speaker 1: two years really making contingency plans, backup plans to make
Speaker 1: sure that we can still deliver ice cream to our customers,
Speaker 1: so to our retailers and consumers no matter what. And
Speaker 1: so we have in in the last three months we've
Speaker 1: opened up three new um selling locations for retailers to
Speaker 1: source products from, so hold storage locations across the country
Speaker 1: and what that allows us to do is move inventory
Speaker 1: there be closer to the warehouses of some of our
Speaker 1: our biggest and best customers so that we can get
Speaker 1: product to them faster. Right as there are distribution challenges,
Speaker 1: the closer proximity you are, the easier it is to deliver.
Speaker 1: We have made huge investments, i will say, in our factories.
Speaker 1: So we have four factories across the in the United States.
Speaker 1: We have announced in the last twelve months fifteen new
Speaker 1: production lines across those factories. We are building out walls,
Speaker 1: facilities in every location and that's all around being able
Speaker 1: to produce more product so that it is on shelf
Speaker 1: when you go into your store. I'm thrilled, I'm pleased
Speaker 1: with every single employee in our manufacturing facilities, in our
Speaker 1: distribution network. That is what they're focused on. And what
Speaker 1: I would say is it's our results in the marketplace
Speaker 1: are showing that those investments in the infrastructure production capability.
Speaker 1: Because we know that the challenges are likely to continue
Speaker 1: for a while, we are poised and ready and doing
Speaker 1: everything we can to meet growing demand for ice cream.
Speaker 1: And I will say ice cream demand is going up.
Speaker 1: I wonder about pricing. UM, surely you felt massive inflation
Speaker 1: for your on the input side. Are you able to
Speaker 1: pass it off? We are, so we are seeing inflation
Speaker 1: on our cost structure, right, UM, like everybody is. We've
Speaker 1: been trying to find creative ways around having to impact
Speaker 1: consumers as little as possible on that. So trying to
Speaker 1: find places where there might have been inefficiency in our
Speaker 1: organization and our operations to use, you know, any savings
Speaker 1: to be able to cover those costs. We think some
Speaker 1: of the costs over time, you know, we'll come back down. UM.
Speaker 1: And and we're really looking hard at that. Certainly in
Speaker 1: some areas, UM. You know you see prices going up
Speaker 1: everywhere and UM, but we're doing everything in our power
Speaker 1: to minimize that. We're leveraging our global network of our
Speaker 1: ice cream global company UM to source products UM or
Speaker 1: ingredients for things where we can't get them locally, to
Speaker 1: be able to source them and make them available UM,
Speaker 1: and trying not to impact consumer pricing. Just thirty seconds
Speaker 1: left here, Kim, But I miss the full half gallon.
Speaker 1: I mean, right, I mean when you think about the pricing.
Speaker 1: You can't make the packaging any smaller poster for kids exactly.
Speaker 1: We have plenty of large sized products UM, big containers,
Speaker 1: half gallons. We also, you know, what we're seeing is
Speaker 1: real growth in snack products, so cones and sticks and sandwiches,
Speaker 1: and we're making lots of different multi packed versions of
Speaker 1: that to get at you know, the volume you're looking for,
Speaker 1: UM at a price point that you will also feel
Speaker 1: good about. Thanks so much for joining us. I think
Speaker 1: we're all excited to talk about ice cream. Even in
Speaker 1: uh January, it just snow, it started snowing. I agree.
Speaker 1: I agree with Kim. It isn't it is never too
Speaker 1: cold to eat ice cream. Yeah, I'm with you, So
Speaker 1: we'll see. But that was fun to get Kim on
Speaker 1: talking about the ice cream business. The way, if you're
Speaker 1: wondering about the hummer the recipe, a little khlua, some
Speaker 1: light rum and some vanilla ice cream, Kim would probably
Speaker 1: recommend some kind of bourbon vanilla from Hoggendoss. Mix that
Speaker 1: up and you're good to go. And uh, but don't
Speaker 1: drink too many because they go down, they go down
Speaker 1: real easy, and then you don't realize until later that
Speaker 1: it may have been too much. Thanks for listening to
Speaker 1: the Bloomberg Markets podcast. You can subscribe and listen to
Speaker 1: interviews of Apple Podcasts or whatever podcast platform you prefer.
Speaker 1: I'm Matt Miller. I'm on Twitter at Matt Miller three.
Speaker 1: Pet On Fall Sweeney I'm on Twitter at pt Sweeney.
Speaker 1: Before the podcast, you can always catch us worldwide at
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