WEBVTT - Bloomberg Businessweek Weekend - January 24th, 2020 0:00:02.520 --> 0:00:06.360 This is Bloomberg Business Week from Bloomberg Radio. Hi, I'm 0:00:06.440 --> 0:00:08.760 Jason Kelly and I'm Carol Master. Welcome to the weekend 0:00:08.920 --> 0:00:11.680 edition of Bloomberg Business Week. Over the next couple of hours, 0:00:11.680 --> 0:00:13.880 we'll bring you news of the week, insights from the magazine, 0:00:14.040 --> 0:00:17.400 and more. And that includes an interesting story about trade. 0:00:17.480 --> 0:00:21.919 We've talked so much. Everyone has been for decades a proponent, Jason, 0:00:22.000 --> 0:00:24.840 a free trade. Now it might be that we're moving 0:00:24.840 --> 0:00:27.479 into the era of managed trade. Right. I wasn't really 0:00:27.520 --> 0:00:30.280 familiar with the nuances of this. We've talked, as you say, 0:00:30.320 --> 0:00:33.320 so much about trade, but this could be a major 0:00:33.400 --> 0:00:37.240 inflection point for how goods and services move throughout the world. 0:00:37.280 --> 0:00:39.519 We're also going to talk, speaking of goods and services, 0:00:39.560 --> 0:00:43.479 about credit cards, how you use them, and what may 0:00:43.479 --> 0:00:45.920 be going on on the other side of the equation 0:00:46.080 --> 0:00:50.280 with credit card companies raising the amount you can borrow. 0:00:50.440 --> 0:00:52.520 That could be our new debt trap. That's a little 0:00:52.520 --> 0:00:54.280 bit of a scary story. We finish up, though with 0:00:54.320 --> 0:00:56.920 something fun. Polly Moss ends did a story and it 0:00:56.960 --> 0:00:59.080 takes a look at the Goop Lab with Gwyneth Paltrow 0:00:59.160 --> 0:01:03.160 making its debut on Netflix. She watched this series. It's 0:01:03.160 --> 0:01:06.880 a series. Every episode Jason begins with a warning, so 0:01:07.480 --> 0:01:11.920 uh fascinating. Another fun bit is the exclusive look and 0:01:12.240 --> 0:01:15.640 exclusive sound of the new Super Bowl ad from Porsche. 0:01:15.680 --> 0:01:18.640 They haven't been in the big game for decades. They're back. 0:01:18.840 --> 0:01:21.200 First up, though, we talked about this week's issue with 0:01:21.240 --> 0:01:24.399 the editor of Bloomberg business Week, Jill Webber. Jill Webber, 0:01:24.480 --> 0:01:26.360 the editor of Business Week, here with us in New 0:01:26.480 --> 0:01:29.840 York City. Let's start with the cover and arresting image 0:01:29.920 --> 0:01:34.560 and a reminder that for all the haters against Tesla, 0:01:34.959 --> 0:01:37.759 that stocks doing awesome. Yeah, so the company's way up 0:01:37.880 --> 0:01:41.440 so far this year, but also over the past few months. Uh. 0:01:41.560 --> 0:01:43.880 This is the story of by Dana Hole about a 0:01:43.920 --> 0:01:48.600 really vocal minority of Tesla haters, Elon muskaters on Twitter 0:01:48.800 --> 0:01:52.840 go by uh tesla q. And these are short sellers 0:01:52.880 --> 0:01:56.400 who are really hurting right now because as this stock 0:01:56.520 --> 0:01:59.200 is swared, they've felt the front of that. Well, that's 0:01:59.200 --> 0:02:02.120 what I love about this. George, Like Danna gets to 0:02:02.480 --> 0:02:05.080 this one individual in particular who's really had a heated 0:02:05.120 --> 0:02:08.960 social media relationship with Elon muss. Yeah, it's an incredible 0:02:08.960 --> 0:02:12.160 story about sort of the battle between this one guy 0:02:12.360 --> 0:02:17.639 who really didn't like the company's fundamentals and his interactions 0:02:17.720 --> 0:02:22.880 with Tesla as a company, and how he really uh 0:02:23.240 --> 0:02:26.480 took things to a different place and sort did Tesla 0:02:26.520 --> 0:02:28.919 in response, right, I mean, and it's just a reminder 0:02:28.960 --> 0:02:31.400 of how binary this is. We talked about it, I 0:02:31.440 --> 0:02:33.600 feel like just about every day on our show, and 0:02:33.680 --> 0:02:36.400 we have the ball and we have the Theirs and 0:02:36.639 --> 0:02:39.080 never the Twain shall meet. I mean, there's nobody who 0:02:39.200 --> 0:02:42.480 essentially is like Tesla Ansca. Yeah, that's right. So what 0:02:42.680 --> 0:02:45.280 Danna's story really does well is like there is this 0:02:45.680 --> 0:02:49.000 wider community of haters and they're almost like hive minded 0:02:49.360 --> 0:02:52.160 with each other about the company. And it's sort of 0:02:52.200 --> 0:02:55.840 the case study of like one guy who actually you know, 0:02:56.320 --> 0:03:00.560 got into the ire of Elon and Tesla, and that's 0:03:00.600 --> 0:03:03.960 remarkable timing for this as the company goes through the 0:03:04.040 --> 0:03:06.880 roof in terms of evaluation. Well, it's safe to say 0:03:06.919 --> 0:03:08.920 that one of the reasons that Tesla has become so 0:03:09.000 --> 0:03:13.080 popular and is captured the imagination is the environment and 0:03:13.120 --> 0:03:16.720 people really caring about the impact of the planet, the 0:03:16.760 --> 0:03:22.040 car industry, etcetera, which leads us tog and Green and 0:03:22.040 --> 0:03:25.320 Bloomberg Green, which announced We've just announced this week big launch. 0:03:25.960 --> 0:03:28.840 This is the company really down the newsroomally doubling down 0:03:29.200 --> 0:03:31.680 on a space that we think there's going to be 0:03:32.080 --> 0:03:35.760 some amazing coverage around, all rooted in data. But look 0:03:35.840 --> 0:03:38.600 like climate change is the story of the moment um 0:03:38.640 --> 0:03:40.680 and it's not one that's going away, and we really 0:03:40.680 --> 0:03:44.280 wanted to root that story in in data and stories 0:03:44.440 --> 0:03:46.560 that are going to be really memorable. So that's what 0:03:46.800 --> 0:03:48.920 you should expect from Bloomberg Green. And in this issue 0:03:48.960 --> 0:03:51.520 of Bloomberg Business Week, we use that data as a 0:03:51.560 --> 0:03:54.800 centerpiece and a story about quants and how they're looking 0:03:54.840 --> 0:03:56.920 at is G data. Yeah, and if you think about 0:03:56.960 --> 0:03:59.240 who's got the most data is the quant and they're 0:03:59.280 --> 0:04:01.560 really good at using it, right, but the catches, not 0:04:01.760 --> 0:04:04.560 all of the data really completes the picture. And what 0:04:04.720 --> 0:04:07.440 quants are actually really good at our plugging those holes 0:04:07.520 --> 0:04:10.200 in smart ways, well, Bloombergreen kind of helping to complete 0:04:10.200 --> 0:04:13.000 the picture too, right. This is just an all in platform, 0:04:13.280 --> 0:04:17.279 you know, online TV radio, they have this incredible dashboard, 0:04:17.320 --> 0:04:19.760 but it's all about things that impact the environment and 0:04:19.800 --> 0:04:23.479 really tracking what's going on and bringing it back to data, 0:04:23.600 --> 0:04:25.800 like quantifiable things that we can look at and like 0:04:25.880 --> 0:04:29.040 where we're applicable, where are places that we can actually 0:04:29.040 --> 0:04:32.360 make change? And I think that will be that impact 0:04:32.400 --> 0:04:36.080 will be a really amazing element of this Bloombergreen project. 0:04:36.200 --> 0:04:38.279 A story of our time for sure. Another story of 0:04:38.279 --> 0:04:42.360 our time, obviously is China and sports. We love talking 0:04:42.360 --> 0:04:45.920 about it and a phenomenal profile by Ira blud Way 0:04:45.920 --> 0:04:49.520 of Joe Psi, the owner of the Brooklyn Nets, vice chairman, 0:04:49.640 --> 0:04:52.520 co founder of Ali Baba. Talk about a man in 0:04:52.520 --> 0:04:54.719 the center of it all. So what's interesting about this 0:04:54.800 --> 0:04:56.560 is that I don't think many people knew who this 0:04:56.640 --> 0:05:01.440 guy was until the NBA and nine of fiasco happened 0:05:01.480 --> 0:05:03.480 a couple of months ago. And that was immediately when 0:05:03.480 --> 0:05:06.360 we're like, wait, that guy who just acquired the nets 0:05:06.600 --> 0:05:10.000 Brooklyn Nets, now uh is the co founder Valley Baba. 0:05:10.279 --> 0:05:13.080 His story is even more remarkable than that. He's taiwan 0:05:13.120 --> 0:05:18.440 He's born Ivy League educated, lives in Hong Kong, speaks Mandarin, 0:05:18.640 --> 0:05:22.440 you know, billionaire and yet in the middle of this 0:05:22.520 --> 0:05:26.480 whole dilemma between how the NBA and China are gonna interact, 0:05:26.640 --> 0:05:29.640 he put out a really thoughtful note and it made 0:05:29.720 --> 0:05:31.640 us go, we want to talk to that guy, because 0:05:31.680 --> 0:05:36.680 he's really in the thick of everything that's transpiring between worlds. Well, 0:05:36.720 --> 0:05:38.280 and Ira not only got to talk to him, he 0:05:38.320 --> 0:05:40.760 got to talk to Jack mat and really presents this 0:05:40.920 --> 0:05:44.320 portrait of someone who represents the biggest story about time. 0:05:44.360 --> 0:05:46.680 As I said, and he looked at the Brooklyn Nets 0:05:46.680 --> 0:05:49.080 and said, you know what's the best investment better than 0:05:49.080 --> 0:05:52.320 a Park Avenue apartment? Professional sports and NBA, And that's 0:05:52.400 --> 0:05:56.480 Bloomberg Business Week editor Joel Webber the benefits of free trade, Jason. 0:05:56.520 --> 0:05:58.800 They have been touted for decades, and based on what's 0:05:58.800 --> 0:06:00.919 going on in the world, that era a free trade 0:06:00.960 --> 0:06:03.640 maybe coming to an end. So I learned something very 0:06:03.720 --> 0:06:06.240 interesting this week from reading this story. I always learned 0:06:06.240 --> 0:06:08.800 something from Peter Coy. He's here with us in New 0:06:08.880 --> 0:06:12.359 York City. Managed trade is a term that I don't 0:06:12.360 --> 0:06:15.560 think if I had heard, I really understood until I 0:06:15.600 --> 0:06:18.720 read your story. Tell us what it is. Managed trade 0:06:18.800 --> 0:06:21.080 is where, instead of started letting the chips fall where 0:06:21.120 --> 0:06:25.240 they may, letting private parties work things out for themselves, 0:06:25.440 --> 0:06:29.200 you sort of dictate terms. So, for example, the Voluntary 0:06:29.240 --> 0:06:31.920 Restraining Agreement on autos with Japan, that was a form 0:06:31.960 --> 0:06:35.880 of managed trade. It was quote unquote voluntary and effect. 0:06:35.920 --> 0:06:39.520 It was a quota on Japanese imports of cars. We 0:06:39.600 --> 0:06:43.080 seem to be going through another era of that now, 0:06:43.600 --> 0:06:46.440 and the US China Deal, the Phase one deal that 0:06:46.600 --> 0:06:50.560 was signed by Trump earlier this month, is an example 0:06:50.560 --> 0:06:53.560 of that. According to Gary Clyde Hoffbauer from the Peterson 0:06:53.640 --> 0:06:57.880 Institute for International Economics, recall, the deal has a provision 0:06:58.240 --> 0:07:01.000 that China will buy two billion in dollars worth of 0:07:01.080 --> 0:07:03.480 products from the US of a certain period of time. 0:07:03.920 --> 0:07:08.599 And there's a secret provision in that agreement, secret we 0:07:08.640 --> 0:07:13.840 haven't seen it, that specifies what products and what volumes. 0:07:14.600 --> 0:07:16.880 So this is not free trade by any means. This 0:07:16.960 --> 0:07:20.680 is an agreement between two countries where it's just hammered 0:07:20.680 --> 0:07:24.880 out in a in a back room, and you can 0:07:24.960 --> 0:07:26.880 argue as good or as bad. But it's clearly not 0:07:27.680 --> 0:07:30.240 ordinary less a fair free trade. So why are you 0:07:30.240 --> 0:07:32.320 writing about it? Why is it so significant? You think 0:07:32.320 --> 0:07:34.320 that maybe we be that we're pushing back on the 0:07:34.440 --> 0:07:36.600 error free trade and remind us of free trade was 0:07:36.600 --> 0:07:40.080 the whole concept right of nations doing what they do best, 0:07:40.840 --> 0:07:43.480 that buying what they needed, and everybody kind of doing 0:07:43.520 --> 0:07:47.520 the best that they could and everybody benefits. That's the 0:07:47.800 --> 0:07:50.920 ideal econ one a one version of trade, and it 0:07:50.920 --> 0:07:54.560 it can work, does work in many cases. Now, the 0:07:54.720 --> 0:07:57.960 argument in favor of managed trade would be, look, um, 0:07:58.040 --> 0:08:00.800 China is just not whole ending up its end of 0:08:00.840 --> 0:08:06.160 the bargain, and they're not a market economy, so why 0:08:06.200 --> 0:08:09.600 are we pretending they are a market economy. Let's just 0:08:10.240 --> 0:08:13.760 knock heads and get a deal done. And that is 0:08:14.200 --> 0:08:18.160 what the Robert Leightheiser, the U s Trade representative, and 0:08:18.200 --> 0:08:21.000 Trump seems to have concluded. Because I feel like it's like, well, 0:08:21.040 --> 0:08:25.040 sometimes a nation, maybe China, because they don't necessarily play 0:08:25.080 --> 0:08:28.320 like everybody else on the developed world stage, that maybe 0:08:28.320 --> 0:08:30.240 they need a little bit of nudging, Maybe they need 0:08:30.280 --> 0:08:35.800 some are so so that is the pro argument. The 0:08:35.880 --> 0:08:39.800 con argument is that there is harm done here, and 0:08:39.960 --> 0:08:43.040 one form of harm is that you end up um 0:08:43.120 --> 0:08:46.120 China is buying absurd amounts of things that doesn't really need, 0:08:46.160 --> 0:08:50.280 which course is not a US concerned, but it's just 0:08:50.480 --> 0:08:55.680 like creating inefficiencies on both sides. The other harm here 0:08:55.840 --> 0:08:58.560 is that let's say that the US we don't know 0:08:58.800 --> 0:09:01.400 what the terms of deal are, but I can imagine 0:09:01.440 --> 0:09:05.520 there's probably a lot of soybeans in there. So um, Canada, 0:09:05.960 --> 0:09:09.200 Brazil had captured a lot of the soybean market from 0:09:09.200 --> 0:09:12.720 the US. Now the US is kind of capturing it back. 0:09:13.080 --> 0:09:16.680 Well more generally speaking, what happens is that the country 0:09:16.720 --> 0:09:20.160 that is suddenly um frozen out of the market because 0:09:20.200 --> 0:09:24.240 the US is coming in as a legitimate complaint, can 0:09:24.240 --> 0:09:27.360 go to the World Trade Organization. In fact, the Europeans 0:09:27.360 --> 0:09:30.679 have already, uh we had Phil Hogan, he's the US 0:09:30.960 --> 0:09:35.040 I mean the European Union Trade commissioner in Washington this 0:09:35.200 --> 0:09:38.319 past week. He said, we haven't read it yet, or 0:09:38.320 --> 0:09:40.120 we'll take a close look at this, and if we 0:09:40.160 --> 0:09:42.960 believe that this is managed trade, which is against the 0:09:42.960 --> 0:09:45.960 principles of the World Trade Organization, we could bring a complaint. 0:09:46.280 --> 0:09:48.440 So one of the lines in your story that I 0:09:48.440 --> 0:09:52.120 think is really revealing in many ways, and I think 0:09:52.120 --> 0:09:54.720 we'll resonate with a lot of our readers, listeners and viewers, 0:09:54.920 --> 0:09:57.679 is that managed trade is about cutting deals rather than 0:09:57.720 --> 0:10:00.400 following the rules. And I think any one who has 0:10:00.440 --> 0:10:04.200 watched this administration will say, yep, that checks out right. 0:10:04.240 --> 0:10:07.520 I mean, this is the whole ethos of the Trump 0:10:07.520 --> 0:10:10.559 administration in many ways, and you know, makes no bones 0:10:10.559 --> 0:10:13.880 about it. That's what he wants to do. He's doing it. 0:10:14.400 --> 0:10:17.760 And uh, there are people who would say it's it's 0:10:17.800 --> 0:10:24.760 achieving certain objectives. Um. But in the broad picture, the US, 0:10:25.400 --> 0:10:31.319 going back to Franklin delan or Roosevelt pastor Recipolical Trade 0:10:31.320 --> 0:10:35.199 Agreements Act, that was about trying to pull back from 0:10:35.200 --> 0:10:38.080 the smooth holly terrorist which contributed to the onset of 0:10:38.080 --> 0:10:42.280 the Great Depression. The idea that we want to increase 0:10:42.400 --> 0:10:48.959 commerce between countries and the US for decades has generally 0:10:49.080 --> 0:10:51.760 been in the forefront of promoting free trade. We have 0:10:51.840 --> 0:10:54.839 the General givement on tarris and trade. That's gap. Then 0:10:54.840 --> 0:10:59.439 we then we had the World Trade Organizations successor and 0:10:59.440 --> 0:11:01.120 and I think we'll forget it. So I didn't run. 0:11:01.200 --> 0:11:02.880 But like the w t OH that was just created 0:11:02.920 --> 0:11:05.400 in the ninety nineties, right, I mean, that's a relatively 0:11:05.480 --> 0:11:11.880 recent invention, and the whole goal is to that everyone 0:11:11.960 --> 0:11:15.640 benefits when there's more commerce, and in fact we've seen that. 0:11:16.000 --> 0:11:19.440 I mean, certainly the rise of China and India lifting 0:11:19.520 --> 0:11:21.880 hundreds of millions of people from poverty, has a lot 0:11:21.920 --> 0:11:27.200 to do with their joining the World trade UH system. So, Peter, 0:11:27.320 --> 0:11:30.440 is this just something that the US is pursuing. Well, 0:11:30.480 --> 0:11:33.840 it's most conspicuous in the United States thanks to Trump's 0:11:34.200 --> 0:11:37.840 whole philosophy and trade. In fact, we've seen some examples 0:11:37.880 --> 0:11:43.520 of free trade elsewhere. There's a year ago the European 0:11:43.600 --> 0:11:46.720 Union in Japan struck a free trade agreement. Just in 0:11:47.200 --> 0:11:52.439 UH this month earlier January one, UH, China actually pulled 0:11:52.440 --> 0:11:55.320 back on some tariffs. So it's a it's a little 0:11:55.320 --> 0:11:57.080 bit of a jiu jitsu thing, you know. It's not 0:11:57.120 --> 0:12:00.400 that China is suddenly a free trade country, but they 0:12:00.440 --> 0:12:04.440 see the advantages of striking agreements like this. Now, I 0:12:04.480 --> 0:12:08.079 do believe that the United States is so influential that 0:12:08.160 --> 0:12:12.640 when managed trade starts to come into the U S agreements, 0:12:12.920 --> 0:12:14.720 there's a good chance that other countries could look at 0:12:14.760 --> 0:12:16.560 and say, hey, we can either fight this or we 0:12:16.559 --> 0:12:18.600 could join it, and I might start doing the same thing. Well, 0:12:18.640 --> 0:12:21.040 and I do wonder and you address this a bit 0:12:21.040 --> 0:12:24.280 in your story, Peter, how do you square or how 0:12:24.320 --> 0:12:28.319 does this managed trade phenomenon and the resurgence of it 0:12:28.480 --> 0:12:33.120 relate to the lack of multilateralism and sort of a 0:12:33.160 --> 0:12:36.200 move towards bilateralism is part of it. I talked to 0:12:36.240 --> 0:12:39.559 Myron Brilliant, He's the person who handles trade issues for 0:12:39.600 --> 0:12:41.760 the US Chamber of Commerce, and he said, you know, 0:12:41.960 --> 0:12:45.680 we had an air of multilateralism. Trump has been quite specific. 0:12:45.840 --> 0:12:50.040 He does not believe in multilateral bilateralism, and he believes 0:12:50.080 --> 0:12:53.120 that tariffs are a useful weapon. In fact, that's the 0:12:53.160 --> 0:12:55.800 card you will be able to play. He believes that 0:12:55.920 --> 0:12:57.880 since the US of the world's largest market, and it 0:12:57.920 --> 0:13:02.200 does that the best way to strike a deal is 0:13:02.240 --> 0:13:05.440 to threaten to withhold access to that market. That's Peter Coy, 0:13:05.600 --> 0:13:08.280 economics editor of the magazine. I think what's interesting. We've 0:13:08.280 --> 0:13:10.959 talked about free trade and how important it has been 0:13:11.040 --> 0:13:14.319 Jason to lifting so many people around the world out 0:13:14.360 --> 0:13:17.240 of poverty. But maybe that era is over well, and 0:13:17.480 --> 0:13:19.960 that era may be over for a long time. I 0:13:19.960 --> 0:13:21.839 think one of the things that Peter does a nice 0:13:21.920 --> 0:13:24.560 job of illustrating this story is these are not things 0:13:24.600 --> 0:13:27.600 that change overnight, and once a shift like this happens, 0:13:27.920 --> 0:13:30.319 we could be looking at a very different world for decades, 0:13:30.360 --> 0:13:33.120 maybe even a century to come. The protests in Hong 0:13:33.160 --> 0:13:35.440 Kong what now in their seventh month? Jason and the 0:13:35.480 --> 0:13:37.559 impact has been felt on a city that is known 0:13:37.600 --> 0:13:39.679 for its wealth and its high end retail and services. 0:13:39.800 --> 0:13:42.679 It's also well known for those who really know about it, 0:13:42.800 --> 0:13:47.240 for a vast sea of income inequality. It's amazing when 0:13:47.240 --> 0:13:50.640 you look at the numbers that disparity when it comes 0:13:50.640 --> 0:13:53.480 to how much people earn. Jim Allis is here, business 0:13:53.600 --> 0:13:57.440 editor for Bloomberg Business Week to alp us understand the 0:13:57.480 --> 0:14:01.439 employment and unemployment picture that is fast changing. I mean, 0:14:01.480 --> 0:14:03.880 a lot of people have always thought of Hong Kong 0:14:04.360 --> 0:14:06.959 not just as this sort of shopping mecca, but also 0:14:07.080 --> 0:14:10.360 is this place of extreme wealth in in Asia, particularly 0:14:10.400 --> 0:14:14.360 in China. And that's true. It has lots of millionaires. 0:14:14.400 --> 0:14:17.080 It's to play place for the rich. The issue is 0:14:17.080 --> 0:14:19.120 it has an awful lot of people who don't make 0:14:19.200 --> 0:14:22.400 much money. The minimum wage in um Hong Kong is 0:14:22.440 --> 0:14:25.880 actually a little less than five U S dollars. I 0:14:25.880 --> 0:14:29.480 mean that it comes out to being very low. It's 0:14:29.560 --> 0:14:32.360 also the lowest in the A C D. And it 0:14:32.400 --> 0:14:35.800 turns out that what what you have there is a 0:14:35.880 --> 0:14:40.200 gigantic income gap that really gets felt as the you know, 0:14:40.280 --> 0:14:43.560 slow down in the economy happens now because of the 0:14:43.600 --> 0:14:46.640 protests has the biggest inequality gap in the world. Right. 0:14:46.680 --> 0:14:48.720 I think it's is that the Jinny coefficient right where 0:14:48.720 --> 0:14:51.120 they measure that, So it's it's huge, it is a 0:14:51.240 --> 0:14:53.600 it's a it's a giant difference. And I think what 0:14:53.720 --> 0:14:57.200 happens is that you really see it now that the 0:14:57.280 --> 0:15:00.640 economy is slowing down rather dramatically because of the protests, 0:15:00.880 --> 0:15:04.040 all of a sudden employment. This is a place where 0:15:04.080 --> 0:15:07.600 employment has always been extremely high and unemployment has always 0:15:07.600 --> 0:15:11.960 been traditionally. Traditionally, unemployment is less than two percent in 0:15:12.080 --> 0:15:15.040 Hong Kong and UM. So when you see the kinds 0:15:15.080 --> 0:15:18.720 of employment numbers we're looking at now, in retail workers, 0:15:18.840 --> 0:15:24.160 unemployment has gone closer to five percent in UM restaurant workers, 0:15:24.160 --> 0:15:27.280 it's about six percent. Now, that sounds not that for 0:15:27.320 --> 0:15:29.920 a lot of economies, but for Hong Kong, that's double 0:15:30.200 --> 0:15:33.920 triple what traditionally is an unemployment rate. What's happening there 0:15:34.360 --> 0:15:38.040 is that people are discovering folks have stopped coming because 0:15:38.040 --> 0:15:40.520 of the protests and other reasons. So we're going to 0:15:40.560 --> 0:15:43.440 basically start firing people. And they have and they have, 0:15:43.600 --> 0:15:45.360 and they've been firing them, and now there's a fear 0:15:45.400 --> 0:15:48.320 in Hong Kong, that there will be more firings to come, 0:15:48.400 --> 0:15:52.480 simply because we're starting the Lunar New Year celebration. One 0:15:52.480 --> 0:15:55.280 of the quirks of that is that people get lunar 0:15:55.320 --> 0:15:58.600 near Lunar New Year bonuses and they'll get an extra 0:15:58.680 --> 0:16:02.120 month's salary. But a lot of people are afraid that, ah, 0:16:02.160 --> 0:16:04.240 they'll use that extra months salary that comes with the 0:16:04.320 --> 0:16:07.520 bonus to also count as your month severance that you're 0:16:07.520 --> 0:16:10.040 required to pay, and so as soon as you pay 0:16:10.080 --> 0:16:13.960 the bonus, you'll fire people. And that's the big fear well. 0:16:14.000 --> 0:16:15.440 And one of the things you pointed out in the story, 0:16:15.440 --> 0:16:18.240 which I find so interesting is this notion that there's 0:16:18.240 --> 0:16:20.720 a knock on effect too that if people aren't working, 0:16:20.720 --> 0:16:23.240 if the economy slows a little bit, even some of 0:16:23.280 --> 0:16:27.320 those essentially like safety net that exists, you know, meals 0:16:27.320 --> 0:16:30.080 being delivered and things like that, that starts to get cut. 0:16:30.360 --> 0:16:33.240 A lot of meals that were given um are sometimes 0:16:33.320 --> 0:16:37.160 given by restaurants for free. And but now the restaurants 0:16:37.200 --> 0:16:40.800 themselves have fewer visitors because tourism is so far down 0:16:41.080 --> 0:16:44.760 in Hong Kong since the time the protests started, I 0:16:44.760 --> 0:16:48.520 mean tourism has dropped, I guess in November dropped probably 0:16:48.800 --> 0:16:52.680 close to That's hard to imagine. I mean, what's happened 0:16:52.760 --> 0:16:55.680 is a lot of Mainlanders and they depend on Mainlanders 0:16:55.680 --> 0:16:59.080 for their tourism because of visitors to Hong Kong come 0:16:59.120 --> 0:17:02.240 from the mainland. A lot of them either afraid to 0:17:02.280 --> 0:17:06.159 come right now are They're angry that the protesters in 0:17:06.200 --> 0:17:09.240 Hong Kong seem to be anti China, and so from 0:17:09.240 --> 0:17:12.719 mainland there's this has become a nationalistic issue, and so 0:17:12.760 --> 0:17:14.879 they're saying, why should I spend why should I go 0:17:15.000 --> 0:17:17.840 over and uh, you know, do my vacation there when 0:17:17.840 --> 0:17:19.400 I can go elsewhere in the world. Well, and what's 0:17:19.400 --> 0:17:22.720 interesting too from a worker's perspective, if you're a banker, 0:17:23.119 --> 0:17:25.800 you're just picking up stakes and either moving back to London, 0:17:25.800 --> 0:17:28.840 New York or maybe you're relocating to Singapore if you 0:17:28.840 --> 0:17:31.320 want to stay generally in the region. That's what's happening. 0:17:31.320 --> 0:17:34.119 And a lot of banquages are saying, you know, is 0:17:34.160 --> 0:17:36.800 this worth that? Are A lot of companies are saying, 0:17:36.960 --> 0:17:39.760 do we really want to be around there right now 0:17:39.760 --> 0:17:41.919 while this term all is going on? And so the 0:17:41.920 --> 0:17:45.280 beneficiaries of that would be another financial center like Singapore 0:17:45.400 --> 0:17:49.200 are sometimes jobs just go back home. I have to say, though, okay, 0:17:49.280 --> 0:17:51.240 all right, as you say the bankers can find another 0:17:51.280 --> 0:17:53.399 place to live. I mean, what's great about this story? 0:17:53.480 --> 0:17:55.159 What's tragic about this story? And you guys give a 0:17:55.200 --> 0:17:58.000 lot of personal examples of people who don't live on 0:17:58.119 --> 0:18:00.639 much to begin with, right, and some of them they 0:18:00.640 --> 0:18:03.520 talk about these part time workers in the restaurant industry 0:18:03.680 --> 0:18:06.520 that are basically being told to take unpaid leave until 0:18:06.520 --> 0:18:08.920 the economy recovers. It's like, how do you do that? Well, 0:18:08.920 --> 0:18:11.399 there's not much you can do. Um. One of the 0:18:11.560 --> 0:18:15.360 interesting people in the story is a woman who pilots 0:18:15.400 --> 0:18:19.359 a boat that takes diners from the mainland to the 0:18:19.480 --> 0:18:22.680 jumbo restaurant that sits out in Hong Kong Harbor. We've 0:18:22.720 --> 0:18:25.520 all seen pictures of the red restaurant floating there, and 0:18:25.760 --> 0:18:29.800 she used to make thirteen, sometimes twenty six dollars a day. 0:18:29.920 --> 0:18:34.080 Now she's making many days nothing, and that's because fewer 0:18:34.080 --> 0:18:37.160 people are going. The restaurant itself, which is world famous, 0:18:37.400 --> 0:18:40.560 you know, has had to fire half of its employees, 0:18:40.840 --> 0:18:43.560 cut down the number of hours that it operates, and 0:18:43.560 --> 0:18:45.840 cut down the number of days a week that it's open. 0:18:46.160 --> 0:18:48.520 I mean, this is really serious business. And that's Jim 0:18:48.600 --> 0:18:51.520 Ellis talking about Hong Kong and of course Carrol. This 0:18:51.560 --> 0:18:55.800 story got only more complicated this week with the spread 0:18:55.880 --> 0:18:59.480 of that virus that started in Wuhan now has been 0:19:00.040 --> 0:19:03.320 commented in cases in Hong Kong and Singapore, even here 0:19:03.320 --> 0:19:06.480 in the United States. So the Chinese Lunar New Year 0:19:07.040 --> 0:19:09.800 off to a very difficult start, that city being impacted 0:19:09.840 --> 0:19:12.560 from so many different angles. Safe to say, one of 0:19:12.560 --> 0:19:16.240 the more polarizing stocks, companies and individuals is Tesla and 0:19:16.320 --> 0:19:18.639 Elon Musk. I think that is the understatement of the 0:19:18.720 --> 0:19:21.680 year that's going to take the cake, and so much 0:19:21.680 --> 0:19:24.119 of it plays out on Twitter. Absolutely it is the 0:19:24.119 --> 0:19:26.480 place to go if you want to figure out who's 0:19:26.640 --> 0:19:30.880 where on anything. We count a lot on Dana Hall 0:19:31.200 --> 0:19:33.840 to keep us on us on all things Tesla, all 0:19:33.880 --> 0:19:37.600 things Elon, and all things Twitter when it comes to 0:19:37.800 --> 0:19:41.040 this company. She joins us from San Francisco, an amazing 0:19:41.119 --> 0:19:44.560 story in this latest edition of the magazine. Dana, thanks 0:19:44.600 --> 0:19:47.359 so much for being with us. My pleasure, all right, 0:19:47.440 --> 0:19:52.280 So take us inside this confrontation. It feels like this 0:19:52.400 --> 0:19:57.560 ongoing confrontation between the two sides of the Tesla equation 0:19:57.600 --> 0:20:01.600 because there's a community that's essentially been created on Twitter 0:20:02.000 --> 0:20:07.960 that is, shall we say not fans. Yeah, so it's 0:20:08.000 --> 0:20:10.840 sort of known as Tesla Q, and the que is 0:20:10.880 --> 0:20:14.680 added to a company's stock symbol when it files for bankruptcy. Clearly, 0:20:14.760 --> 0:20:17.320 Tesla has not filed for bankruptcy, but there is a 0:20:17.359 --> 0:20:21.280 fairly significant group of people who sort of either feel 0:20:21.320 --> 0:20:24.040 like that's inevitable or they just are not buying what 0:20:24.080 --> 0:20:27.200 Elon Musk is selling. And you know, there have always 0:20:27.200 --> 0:20:30.399 been critics of Tesla on you know, Yahoo Finance and 0:20:30.440 --> 0:20:33.159 Seeking Alpha, but kind of over time, the criticism of 0:20:33.200 --> 0:20:36.960 Tesla migrated to Twitter and the and the hashtag tesla 0:20:37.040 --> 0:20:39.040 q really kind of came into vogue over the past 0:20:39.080 --> 0:20:42.359 couple of years. And with every big news announcement or 0:20:42.400 --> 0:20:45.080 big news event like when Ellen attempted to take the 0:20:45.080 --> 0:20:48.080 company private at fo share, you just saw the tesla 0:20:48.119 --> 0:20:50.520 q hashtag more and more. So it's this sort of 0:20:50.560 --> 0:20:55.240 fascinating world of people that are very critical of Musk. 0:20:55.400 --> 0:20:57.199 Some of them are short sellers, some of them are 0:20:57.240 --> 0:21:00.800 just critics, and it's almost like a alter bubble where, 0:21:00.840 --> 0:21:03.399 you know, if you just follow the tesla Q hashtag 0:21:03.480 --> 0:21:05.359 and you get a completely different view of the company 0:21:05.400 --> 0:21:08.399 that if you follow Musk and all of his adoring fans. 0:21:08.520 --> 0:21:12.080 There's one critic in particular data that you go into 0:21:12.200 --> 0:21:14.760 Randy Pothy. Tell us about him? Who is he? And 0:21:14.960 --> 0:21:17.240 how did he come to have such a big ward 0:21:17.320 --> 0:21:21.440 seems like Twitter war with Elon Musk? Sure, so, Randy 0:21:21.520 --> 0:21:24.840 Pothy is a really fascinating person. You know, tesla Q 0:21:25.080 --> 0:21:27.520 is filled with all kinds of people, and as I 0:21:27.560 --> 0:21:29.480 was kind of trying to explore this world, I was 0:21:29.520 --> 0:21:32.520 looking for a character who could kind of explain what 0:21:32.640 --> 0:21:36.840 this community was all about. And Heathy is an individual 0:21:36.880 --> 0:21:40.040 whose real claim to fame is that he really dogged 0:21:40.080 --> 0:21:44.000 tesla on production at their Fremont factory in eighteen and 0:21:44.080 --> 0:21:47.760 he would post these photographs of the logistics lot and 0:21:47.800 --> 0:21:50.320 the finished vehicle lot and he seemed to really have 0:21:50.400 --> 0:21:53.159 like a beat on daily production numbers. And everyone was 0:21:53.200 --> 0:21:55.560