WEBVTT - Slow-Walking Regulation On Vaping Is Being Challenged 0:00:02.640 --> 0:00:05.320 Welcome to the Bloomberg Penl Podcast. I'm Paul Swinge You. 0:00:05.360 --> 0:00:07.680 Along with my co host Lisa Brahma Wicks. Each day 0:00:07.720 --> 0:00:10.240 we bring you the most noteworthy and useful interviews for 0:00:10.280 --> 0:00:12.520 you and your money, whether at the grocery store or 0:00:12.560 --> 0:00:15.480 the trading floor. Find a Bloomberg Penl podcast on Apple 0:00:15.520 --> 0:00:17.959 podcast or wherever you listen to podcasts, as well as 0:00:17.960 --> 0:00:21.759 at Bloomberg dot com. Time to check in with Bloomberg Opinion. 0:00:21.760 --> 0:00:25.640 We're joined by opinion columnist Max Neeson. Max covers biotech, pharma, 0:00:25.760 --> 0:00:28.280 and healthcare for Bloomberg Opinion. He joins us here in 0:00:28.320 --> 0:00:31.080 a Bloomberg eleventh three oh Studios. So, Max, yesterday the 0:00:31.080 --> 0:00:34.280 President came out swinging pretty hard against the manufacturers of 0:00:34.560 --> 0:00:38.479 vaping products. What's the story. Yeah, absolutely so. So this 0:00:38.600 --> 0:00:40.479 is kind of coming into the news and become more 0:00:40.520 --> 0:00:44.480 controversial lately because there have been a spade of illnesses 0:00:44.520 --> 0:00:48.599 and deaths related to to vaping, and then more broadly, 0:00:48.640 --> 0:00:51.720 over the past couple of years, we've seen the really 0:00:51.840 --> 0:00:55.120 rapid uptake of these products by by teenagers, many of 0:00:55.160 --> 0:00:59.440 them underaged, and a lot of them gravitating towards flavored products. 0:00:59.520 --> 0:01:03.200 So the residents announcement yesterday focused on those uh they're 0:01:03.200 --> 0:01:05.640 gonna move towards trying to clear the market of these 0:01:05.640 --> 0:01:08.720 flavored products that have been so popular and and also 0:01:09.040 --> 0:01:12.040 on top of that keep kind of press for for more, 0:01:12.240 --> 0:01:14.880 more more to be done on the safety issue, which 0:01:14.920 --> 0:01:17.920 is related but separate, I guess to the flavored and 0:01:17.920 --> 0:01:21.320 and the the use by teens. Max. How much is 0:01:21.400 --> 0:01:25.760 this relegated to illegal vaping products that have been tied 0:01:25.800 --> 0:01:30.560 to certain uses of oil that when uh evaporated into 0:01:30.560 --> 0:01:32.560 the lungs can cause all sorts of problems. How much 0:01:32.640 --> 0:01:35.600 is tied to the vaping products sold by the vehemoth 0:01:35.640 --> 0:01:39.720 tobacco companies, So that that's still very much up in 0:01:39.720 --> 0:01:42.080 the air, it looks like from the data we have, 0:01:42.120 --> 0:01:45.000 and this is very limited because you know, the investigation 0:01:45.080 --> 0:01:47.960 is still go ongoing. They're looking at samples in different products. 0:01:48.440 --> 0:01:51.480 But but there is some evidence to suggest that a 0:01:51.520 --> 0:01:53.960 lot of the kind of acute issues are tied to 0:01:54.000 --> 0:01:57.360 people using these sort of bootleg and black market products, 0:01:57.400 --> 0:02:01.960 specifically H T hc UM. So people vaping marijuana have 0:02:02.600 --> 0:02:06.000 been kind of overrepresented among those who've been sick. But 0:02:06.240 --> 0:02:08.200 at this point, you know, we we know so little 0:02:08.240 --> 0:02:11.400 about the safety of these products the long term impact 0:02:11.400 --> 0:02:14.519 that we can't really rule anything out. And then there's 0:02:14.520 --> 0:02:16.880 sort of the broader issue of you know, if if 0:02:16.919 --> 0:02:20.720 we have these potentially emergent safety issues, how how much 0:02:21.120 --> 0:02:23.720 should we be you know, letting these products get a 0:02:23.720 --> 0:02:27.040 relatively unrelated foothold on the market, which sort of in 0:02:27.080 --> 0:02:29.920 the case in the past couple of years. Um, you know, 0:02:29.960 --> 0:02:32.760 the the FDA has been sort of slow to to 0:02:32.840 --> 0:02:35.200 put a regulatory regime in place and then make companies 0:02:35.200 --> 0:02:37.840 apply for approval and and do some some kind of 0:02:37.880 --> 0:02:42.280 more rigorous testing. So I think even if the product 0:02:42.360 --> 0:02:44.679 the problem, you know, the most acute health problem is 0:02:44.720 --> 0:02:48.520 tied to these illegal products, uh, it's still probably behooves 0:02:48.919 --> 0:02:51.280 the US government to take a more active role. And 0:02:51.320 --> 0:02:54.959 then specifically comes to the flavor products, Um, there's you know, 0:02:55.040 --> 0:02:57.160 crystal clear evidence that that these are the ones that 0:02:57.200 --> 0:03:00.200 teams gravity towards so a band makes sense. They're so 0:03:00.320 --> 0:03:02.600 max That's kind of goes to you know, one of 0:03:02.600 --> 0:03:04.480 the areas I thought was very interesting, it's just how 0:03:04.480 --> 0:03:06.560 did some of these how did these products get to 0:03:06.639 --> 0:03:10.120 the market with It seems to me just fund the 0:03:10.120 --> 0:03:14.799 outside is little to know f D a analysis approval 0:03:15.320 --> 0:03:18.520 with so little known about the health risks. I'm just 0:03:18.560 --> 0:03:21.000 surprised that we've It's almost like shutting the door after 0:03:21.040 --> 0:03:24.799 the horses kind of fled. That's exactly what we're seeing here. 0:03:24.840 --> 0:03:29.040 So the FDA only gained sort of regulatory oversight over 0:03:29.080 --> 0:03:33.240 this market back in it had been sort of even 0:03:33.280 --> 0:03:35.640 more than it is now a no man's land, and 0:03:35.720 --> 0:03:38.000 so that that sort of began to the initial process 0:03:38.000 --> 0:03:40.920 of building a regulatory apparatus trying to figure out how 0:03:40.960 --> 0:03:44.200 to regulate these. Initially, companies were supposed to have to 0:03:44.240 --> 0:03:48.800 apply for approval by by two eighteen, but then when 0:03:48.840 --> 0:03:51.720 the Trump administration came to power, they bumped that deadline 0:03:51.760 --> 0:03:54.880 back and and that's the period when we saw Jewel 0:03:55.520 --> 0:03:57.720 kind of you know, hit the market and then create 0:03:57.800 --> 0:04:01.160 this whole sort of a big trans Asian And I 0:04:01.160 --> 0:04:04.240 think the motivation behind that wasn't necessarily a bad thing. 0:04:04.240 --> 0:04:07.760 It's this hope that this could be as valuable cessation 0:04:07.800 --> 0:04:12.840 device away for adult smokers to switch from combustible cigarettes. 0:04:13.160 --> 0:04:16.159 But we're now finding out with the embrace of this 0:04:16.279 --> 0:04:19.520 by by from you know, non smokers, uh, and the 0:04:19.520 --> 0:04:23.080 potential safety issues. I think that argument is sort of 0:04:23.120 --> 0:04:26.080 going out the window, which makes that that decision to 0:04:26.600 --> 0:04:30.320 slow walk the regulatory regime a little bit less defensible. 0:04:31.200 --> 0:04:33.800 So this is actually the implications of this are pretty vast, 0:04:33.800 --> 0:04:36.159 because you've seen the big tobacco companies come out and 0:04:36.160 --> 0:04:39.520 try to present vaping products as a safer alternative. I mean, 0:04:39.520 --> 0:04:42.200 that really has been the future of some of these 0:04:42.200 --> 0:04:46.040 tobacco companies. And I'm wondering, do you think that regulators 0:04:46.040 --> 0:04:49.640 are prepared to force tobacco companies to stop using that, 0:04:50.120 --> 0:04:53.760 to stop saying this is safer when there's not necessarily 0:04:53.800 --> 0:04:56.880 the evidence to back it. So I think that's beginning 0:04:57.279 --> 0:05:00.240 to a certain extent. I recently. I think earlier this 0:05:00.320 --> 0:05:02.720 week we saw the f D send a letter to 0:05:02.839 --> 0:05:06.520 Jewel about about some of its marketing practices, and then 0:05:06.520 --> 0:05:09.760 when they actually start having to apply for marketing approval, 0:05:10.000 --> 0:05:12.000 you know, that's not just about safety, but it's about 0:05:12.000 --> 0:05:13.880 what kind of claims you can make on the market. 0:05:14.120 --> 0:05:16.600 I think that's an area where where there's definitely room 0:05:16.680 --> 0:05:19.359 for the for a regulatory crackdown, And you know, it 0:05:19.400 --> 0:05:22.080 may very well be that over time that this does 0:05:22.200 --> 0:05:25.279 prove to be a safer alternative in some cases. I 0:05:25.320 --> 0:05:27.640 think the issue is that, you know, unlike Europe, where 0:05:27.640 --> 0:05:30.359 these are pretty well regulated and you can make a 0:05:30.360 --> 0:05:33.680 better a better case, potentially, we just have a lot 0:05:33.720 --> 0:05:35.800 of people that are using this for for something other 0:05:35.880 --> 0:05:39.400 than switching or cessation, and uh, until we have a 0:05:39.480 --> 0:05:43.440 much stronger marketing and regulatory regime where we're you know, 0:05:43.440 --> 0:05:45.840 it's it's not a market that that can really make 0:05:45.880 --> 0:05:49.000 that claim broadly. Thank you so much, Maxneis and Bloomberg 0:05:49.000 --> 0:05:51.680 Opinion healthcare columnist joining us, and of course you can 0:05:51.720 --> 0:05:54.159 read all of his columns as well as all the others. 0:05:54.160 --> 0:05:57.080 They're really fantastic. Read them on the Bloomberg terminal O 0:05:57.160 --> 0:05:59.200 P I n go, or you can read them at 0:05:59.200 --> 0:06:17.960 Bloomberg dot com slash Opinion. It's quantitative easing forever. That 0:06:18.080 --> 0:06:20.400 is the message from the European Central Bank, which cut 0:06:20.400 --> 0:06:23.719 illustrates further below zero today and revived bond purchase until 0:06:24.200 --> 0:06:28.600 whatever today in an announcement. Interestingly, the bond market reaction 0:06:28.839 --> 0:06:32.440 has been a full circle. Yields sharply higher on the 0:06:32.480 --> 0:06:35.599 front end in Germany. You've got the euro strengthening versus 0:06:35.600 --> 0:06:38.159 the dollar after initially weakening to try to help us 0:06:38.200 --> 0:06:40.080 make sense of all of these market moves and going 0:06:40.160 --> 0:06:42.520 forward what some of the e CPS actions will mean 0:06:42.920 --> 0:06:45.720 for the currency. Jukes joins US now Global Fixing come 0:06:45.720 --> 0:06:48.760 strategist for so see it's a general So kid, why 0:06:49.000 --> 0:06:52.919 is the market responding? Perhaps not the way that Mario 0:06:53.000 --> 0:06:58.200 Draggy would have wanted. Um, Well, the turnaround came pretty 0:06:58.279 --> 0:07:01.599 much after all. The news came in so um that 0:07:01.760 --> 0:07:05.360 he announced the quantity of easing details in the first 0:07:05.360 --> 0:07:08.480 ten minutes of his of his talking what they were 0:07:08.480 --> 0:07:12.440 going to do, the new lower revised forecasts on growth, 0:07:12.560 --> 0:07:15.520 concerns about inflation or all of that's in the front 0:07:15.560 --> 0:07:18.680 and we were going down at that point. And then 0:07:18.720 --> 0:07:21.880 after that, really there's no new negative news for the currency. 0:07:22.000 --> 0:07:24.920 That came through, just a Q and A session, a 0:07:25.000 --> 0:07:27.360 joke about how the one thing everyone agreed about was 0:07:27.440 --> 0:07:29.520 that the DISCO policy ought to do more of the 0:07:29.560 --> 0:07:32.320 work from now on in UM and the market just 0:07:32.400 --> 0:07:35.320 mounted back the other way. Hindsight trading would be a 0:07:35.360 --> 0:07:38.119 wonderful thing to be allowed to do, but the market 0:07:38.160 --> 0:07:40.120 was barrish to the euro has been for a long time. 0:07:40.680 --> 0:07:44.600 We were expecting something, We got a package, and we 0:07:44.720 --> 0:07:48.720 just needed a constant diet of of of euro negative 0:07:48.760 --> 0:07:51.960 news and and maybe this sort of summarizes up where 0:07:52.560 --> 0:07:55.920 Mario Mario dragging has got to as he as he 0:07:55.960 --> 0:07:59.760 closes out his time at ECB effectively, UM, it's really 0:08:00.000 --> 0:08:02.600 hard work to push the euro down any further. The 0:08:02.680 --> 0:08:05.600 minute you stopped talking, it just doesn't want to go 0:08:05.680 --> 0:08:10.440 on going down because we're really historical week levels. So kids, 0:08:11.320 --> 0:08:15.040 from your perspective, how effective do you think the moves 0:08:15.080 --> 0:08:18.360 we saw today from the ECB could really be on 0:08:18.840 --> 0:08:25.480 the European wide economy? UM? Pessimistic, but by instinct, I mean, 0:08:25.720 --> 0:08:28.600 you know, sort of the the caveat to that is 0:08:28.600 --> 0:08:30.600 what would happen if you didn't do them, in sense of, 0:08:31.200 --> 0:08:32.800 you know, what would happen in terms of the currency. 0:08:32.840 --> 0:08:34.640 If he'd come around and done nothing today, we might 0:08:34.679 --> 0:08:36.439 have shot that up, we might have shot Bundy olds that, 0:08:36.520 --> 0:08:38.280 we might have done things that would have been damaging 0:08:39.040 --> 0:08:43.880 to everybody except President Trump's happiness at breakfast. And so 0:08:43.880 --> 0:08:45.640 so you have to you have to start off them that. 0:08:45.720 --> 0:08:51.520 But I don't get a sense really that UM continuing 0:08:51.559 --> 0:08:56.319 to supply more and more bond buying, keeping bond shields 0:08:56.520 --> 0:09:01.280 really low, having further negative interest rates really has much 0:09:01.280 --> 0:09:03.520 of an impact. And I don't know underlying credit growth, 0:09:03.559 --> 0:09:07.160 which isn't really the problem that you know, Europe suffering 0:09:07.160 --> 0:09:09.560 from a world trade slowdown and suffering from a global 0:09:09.600 --> 0:09:13.600 disinflation problem. It's suffering Germany in particular, suffering from what's 0:09:13.640 --> 0:09:18.200 happening in China. Um, to my mind, if you want 0:09:18.200 --> 0:09:22.000 to offset weakness in China, why not offset it since 0:09:22.040 --> 0:09:25.240 it affects Germany most with easier fiscal policy in Germany 0:09:25.240 --> 0:09:28.480 to upgrade some of their roads and some of their infrastructure, 0:09:28.480 --> 0:09:31.160 that would be a fine thing to do from that country. 0:09:31.840 --> 0:09:36.160 But but but but putting the financial sectors of the 0:09:36.280 --> 0:09:38.640 point that's closer to the one where they're going to 0:09:38.720 --> 0:09:41.400 charge people. Um, they're going to charge people fees on 0:09:41.440 --> 0:09:43.880 their checking accounts if we push much further and so on. 0:09:44.440 --> 0:09:46.960 I don't know that that's I don't know that that 0:09:47.080 --> 0:09:51.680 really boosts economic activity much. Let's talk about QI forever. 0:09:51.880 --> 0:09:53.320 What's the easy to be going to buy? I mean, 0:09:53.360 --> 0:09:56.520 they own so much of the of the regions dead 0:09:56.559 --> 0:09:59.320 at this point, are they just basically going to own 0:09:59.360 --> 0:10:01.199 all of it at some point and then start buying 0:10:01.280 --> 0:10:05.480 up buildings and stocks and I think that's sort of 0:10:05.600 --> 0:10:08.240 the piece. I mean, this isn't QUEI forever until you 0:10:08.360 --> 0:10:10.400 change the capital key, until you turn around and you 0:10:11.200 --> 0:10:13.240 increase the pool of what it is they are allowed 0:10:13.280 --> 0:10:17.400 to buy. So this is this is qui with um, 0:10:17.400 --> 0:10:20.200 you know, slightly slower pace of bond buying than some 0:10:20.200 --> 0:10:22.400 people have expected. But for as long as for as 0:10:22.440 --> 0:10:24.480 long as they want to keep on going, or for 0:10:24.520 --> 0:10:26.199 as long as there's anything for them to buy, or 0:10:26.240 --> 0:10:28.480 for as long as there's anything to buy, until they 0:10:28.559 --> 0:10:30.880 change what they're allowed to buy. But they'll have to 0:10:30.960 --> 0:10:33.000 they'll have to cross that bridge. And in a sense, 0:10:33.040 --> 0:10:35.920 it was that piece. Is part of what happened today 0:10:36.000 --> 0:10:38.800 is saying, well, what does Quei forever mean? I'm only 0:10:38.840 --> 0:10:40.960 going to buy you know I can. I'm only going 0:10:41.000 --> 0:10:44.640 to buy these particular biscuits. I'll buy them forever. No, 0:10:44.800 --> 0:10:46.559 you'll buy the muntil they run out. And that's how 0:10:46.640 --> 0:10:49.600 it works. Um so so I think we we well, 0:10:49.679 --> 0:10:53.000 we'll cross that bridge another day. But I thought you 0:10:53.000 --> 0:10:55.200 could interpret this if you really wanted to, as a 0:10:55.240 --> 0:10:58.640 plea from Mario dractures were either going to really you know, 0:10:59.080 --> 0:11:02.079 challenge our man date by expanding what we buy or 0:11:02.200 --> 0:11:05.000 you guys in charge of fiscal policy, you've got to 0:11:05.040 --> 0:11:07.800 come and help. That's exactly where I want to go, 0:11:07.920 --> 0:11:12.120 kit were Marry Drawing made several references to the need 0:11:12.160 --> 0:11:14.920 for fiscal stimulus from some of the leading European economies. 0:11:15.200 --> 0:11:19.360 In reality, how much influence does the ECB have over 0:11:19.400 --> 0:11:25.199 individual countries in their fiscal policy. Um, she may be 0:11:25.400 --> 0:11:30.240 more with Christine Lagarde at the ECBs and with Mario 0:11:30.320 --> 0:11:33.360 Dragging in a sense that you know, um, she's a 0:11:33.760 --> 0:11:36.079 She's seven heavyweight. At every big I m F G 0:11:36.200 --> 0:11:38.720 seven meeting you've you've you've had She's She's been there, 0:11:38.760 --> 0:11:42.319 she you know, has been involved. Mayo drag has has been, 0:11:42.520 --> 0:11:45.760 you know, the savior of the Eurozone really sorting it out. 0:11:45.800 --> 0:11:47.319 Without him, I don't know where we would have been 0:11:47.320 --> 0:11:50.800 for the last um eight years since he since he 0:11:50.920 --> 0:11:53.400 turned up. Um So I think they have an influence. 0:11:53.480 --> 0:11:57.240 But counter to that, there's a lot of dogma in Europe. 0:11:57.400 --> 0:12:01.680 You know, politicians don't like aggressive fiscally, particularly in Germany. 0:12:01.679 --> 0:12:04.400 And if you remember back to the G seven meeting 0:12:05.040 --> 0:12:09.520 UM in southwestern France and Burrits, there was nothing in 0:12:09.559 --> 0:12:13.600 the communicuet about major threats to global growth. You know, 0:12:13.800 --> 0:12:17.120 there was plenty of things that were discussed, but I 0:12:17.520 --> 0:12:21.640 didn't I didn't hear President mac Hall talking about, you know, 0:12:21.840 --> 0:12:24.400 the dangers of another European recession anywhere in there and 0:12:24.440 --> 0:12:26.280 what they needed to get together to do for a 0:12:26.320 --> 0:12:29.480 big growth push. So I don't think the politicians are 0:12:29.520 --> 0:12:33.120 quite on the same page as the markets and central 0:12:33.160 --> 0:12:36.200 banks yet. I mean, Europe at least on growth, to 0:12:36.280 --> 0:12:38.880 be honest. But yeah, that's not to say that that's 0:12:38.920 --> 0:12:40.679 not to say they'll ignore Christine Lagarde. I think that 0:12:40.720 --> 0:12:42.680 would be wrong. The thing they do that. I do 0:12:42.760 --> 0:12:46.160 want to just bring you some breaking news. CNBC is 0:12:46.559 --> 0:12:49.160 coming out and reporting the White House is not considering 0:12:49.200 --> 0:12:52.320 an interim China deal, and you're seeing the rally and 0:12:52.400 --> 0:12:55.079 status pair back a bit with a NAZDAC up now 0:12:55.160 --> 0:12:57.240 just for tents of a percent in the SMP up 0:12:57.400 --> 0:12:59.600 two tenths of a percent. And I wonder when we 0:12:59.640 --> 0:13:02.640 talk of about headwinds to growth, whether we're really just 0:13:02.720 --> 0:13:05.559 talking about trade disputes. I mean, how much of what 0:13:05.640 --> 0:13:08.559 central banks do at this point kit will be dictated 0:13:08.720 --> 0:13:11.560 almost entirely upon whether there is some sort of easing 0:13:11.600 --> 0:13:15.760 and global trade tensions um. Yeah. The trouble with the 0:13:15.760 --> 0:13:17.480 global trade ens is they come and go and come 0:13:17.480 --> 0:13:20.000 and go and come and go, and time passes, if 0:13:20.040 --> 0:13:23.360 you like, in the sense that uh, you know that 0:13:23.520 --> 0:13:26.679 that that the impact on corporate profitability for example, just 0:13:26.760 --> 0:13:32.160 continues to um feeds through and that's not something it's 0:13:32.200 --> 0:13:34.800 going to go away. Beast planted on my desk a 0:13:34.800 --> 0:13:36.840 couple of hours ago from my colleague Albert Edwards, who 0:13:36.920 --> 0:13:38.839 is known as one of the big bears of most 0:13:38.880 --> 0:13:43.559 things in the markets, warning about you know what the 0:13:44.080 --> 0:13:47.040 profit cycle and what it means for recession risks and 0:13:47.040 --> 0:13:50.280 and my senses and I'm really sort of feels sitting 0:13:50.320 --> 0:13:53.360 in the UK every day that uncertainty about trade with 0:13:53.480 --> 0:13:56.800 deals on off, tariffs up, not uf postponed, but not 0:13:56.840 --> 0:14:00.080 postponed forever. What's going to happen? Time goes on in 0:14:00.120 --> 0:14:03.679 that process and on the procession risk grows globally. Kid 0:14:03.760 --> 0:14:08.280 Duke's chief Global ex Strategists for Society General, joining us 0:14:08.559 --> 0:14:11.120 from London, Thank you so much for your thoughts on 0:14:11.160 --> 0:14:13.960 the E C. B UH news we had this morning. 0:14:30.080 --> 0:14:32.520 This week, Lisa and I were in Boston for the 0:14:32.600 --> 0:14:35.640 Boston Fintech Week, where we met a lot of cool 0:14:35.800 --> 0:14:39.640 entrepreneurs bringing their technology to the financial services industry. One 0:14:39.640 --> 0:14:42.760 of the participants at the Boston Fintech Week is Mike Massaro, 0:14:42.920 --> 0:14:47.920 CEO of fly Wire. UM. Mike joins us here from Boston. Mike, 0:14:47.920 --> 0:14:51.200 thanks so much for joining us. So we think about finance, 0:14:51.280 --> 0:14:54.480 fintech and just bringing more technology to financial services. Give 0:14:54.520 --> 0:14:56.840 us a little sense of what your company, fly Wire 0:14:56.880 --> 0:15:00.720 is all about. Sure, thanks Paul, thanks for having me. Uh. 0:15:00.760 --> 0:15:05.040 Flywire really helps with global cross border payment challenges. So 0:15:05.200 --> 0:15:09.560 we look at vertical markets such as education, healthcare, travel, uh, 0:15:09.560 --> 0:15:11.640 and they're really complicated when comes to how money moves 0:15:11.680 --> 0:15:14.080 around the world and uh, and what we're doing is 0:15:14.120 --> 0:15:16.440 we're making that much much simpler. We're making it easy 0:15:16.520 --> 0:15:18.920 for people to pay, for instance, from China to attend 0:15:18.960 --> 0:15:21.960 a place like Harvard UM and and those transactions have 0:15:22.240 --> 0:15:25.200 typically gone over the banking rails historically. And what fly 0:15:25.320 --> 0:15:27.400 Wire has done is we've made it a lot easier 0:15:27.440 --> 0:15:31.760 for those institutions, uh, you know, educational, medical, or travel 0:15:31.800 --> 0:15:34.480 companies to to collect money all over the world. So 0:15:34.560 --> 0:15:37.440 what are some of the obstacles that make this much 0:15:37.480 --> 0:15:40.400 more difficult than people might imagine, Which is send over 0:15:40.440 --> 0:15:43.480 your money and be done with that. You know, one 0:15:43.520 --> 0:15:46.000 thing is the transaction size. Right, A lot of consumers 0:15:46.040 --> 0:15:47.840 we think about buying you know, five or ten or 0:15:47.840 --> 0:15:52.040 even things on e commerce when the transaction size goes 0:15:52.120 --> 0:15:54.800 north of thousands of dollars, sometimes tens of thousands of 0:15:54.800 --> 0:15:57.560 dollars um only so many consumers can even put a 0:15:57.600 --> 0:15:59.920 transaction of that size on a credit card, so they 0:16:00.000 --> 0:16:02.640 need other ways to pay, traditionally through their bank accounts 0:16:02.720 --> 0:16:05.880 or alternatives, um. And so it's really difficult for the 0:16:05.920 --> 0:16:08.440 billers or the receivers of money as well to manage 0:16:08.440 --> 0:16:11.600 all the changing dynamics and payments. Right, as much as 0:16:11.840 --> 0:16:14.880 everybody's trying to make payments easier, they're probably the most 0:16:14.880 --> 0:16:19.240 complicated they've ever been. Right, More global commerce, more regulation, 0:16:19.880 --> 0:16:24.320 more security vulnerabilities, all of those things make it more challenging. So, uh, 0:16:24.920 --> 0:16:27.680 you know, both the receivers have had a hard time 0:16:27.720 --> 0:16:29.600 with it, but it also the payers haven't had a 0:16:29.600 --> 0:16:32.160 great experience because there aren't great ways to pay outside 0:16:32.160 --> 0:16:35.520 the traditional international bank wire. So, Mike, one of the 0:16:35.520 --> 0:16:38.120 big issues I know for all of us, all consumers, 0:16:38.160 --> 0:16:41.600 as we transact more and more online, is security. Give 0:16:41.640 --> 0:16:43.360 us a sense of kind of how you guys approach 0:16:43.440 --> 0:16:45.400 security because you're talking about, as you mentioned, kind of 0:16:45.400 --> 0:16:48.640 some some bigger sums of money. Yeah, you know, it's 0:16:48.680 --> 0:16:51.880 critical to be part of that trusted environment, right. So 0:16:52.200 --> 0:16:55.440 you know, flyware doesn't help you send money anywhere. Right, 0:16:55.640 --> 0:16:58.720 it's very purpose built, so we work with the receivers. 0:16:58.720 --> 0:17:01.280 So it's a it's a trusted receiver on one side. 0:17:01.680 --> 0:17:04.400 In many ways, it's almost like a closed loop, right, 0:17:04.440 --> 0:17:07.160 because the money ultimately is going to Yale or Mass 0:17:07.240 --> 0:17:10.480 General Hospital, u c L A Medical Center um OR 0:17:10.640 --> 0:17:15.280 or you know somebody like um USC from an educational perspective, 0:17:15.480 --> 0:17:17.800 so you know that one side of the transaction, you 0:17:17.800 --> 0:17:19.159 know it's where it's going to go, and you know 0:17:19.240 --> 0:17:21.199 the purpose of those funds. So that in it in 0:17:21.280 --> 0:17:23.399 itself is a big game changer when it comes to 0:17:23.440 --> 0:17:26.360 cross border payments. And then the challenge that we had 0:17:26.359 --> 0:17:28.199 to do is we had to build a platform that 0:17:28.200 --> 0:17:31.439 could understand all the regulatory and security requirements within the 0:17:31.520 --> 0:17:34.520 various countries. Uh. So you know, for instance, in places 0:17:34.560 --> 0:17:37.960 like China, India, Korea, you have various kind of checks 0:17:37.960 --> 0:17:41.080 that have to occur either with the financial system or documentation. 0:17:41.119 --> 0:17:43.000 You have to collect to make sure the funds can 0:17:43.000 --> 0:17:45.800 securely move and so that's part of what we've done, 0:17:45.920 --> 0:17:48.960 is as as building Flower and the technology platform we've 0:17:49.000 --> 0:17:52.639 built in to really check that we're both satisfying the 0:17:52.680 --> 0:17:56.399 security and compliance requirements within the country, but also taking 0:17:56.440 --> 0:17:58.879 that effort in that those issues away from our clients, 0:17:58.880 --> 0:18:01.160 which are the ones receiving them. Any Mike, a lot 0:18:01.160 --> 0:18:04.000 of people going to blockchain and actually that these cross 0:18:04.040 --> 0:18:08.240 border payments are a key place for blockchain products crypto 0:18:08.320 --> 0:18:12.600 assets to play an important role to basically transfer something 0:18:12.640 --> 0:18:16.440 in a very easy, seamless way. Is that something that 0:18:16.640 --> 0:18:18.960 is on your horizon at all that your company is 0:18:18.960 --> 0:18:22.280 looking into? Yeah, you know, I think we're always I'm 0:18:22.280 --> 0:18:25.399 a big believer in the underlying blockchain technology associated to 0:18:25.680 --> 0:18:29.280 validating transactions or having a shared kind of global ledger. 0:18:29.600 --> 0:18:32.800 I think crypto has turned a little more into speculation lately. UM, 0:18:32.840 --> 0:18:35.240 And I think ultimately if you look years and years out, 0:18:35.640 --> 0:18:38.920 UM there is likely to be a digital cryptocurrency based 0:18:38.920 --> 0:18:41.560 off some kind of fiat currency. UM. I think how 0:18:41.600 --> 0:18:43.680 long that takes to develop? I think people have been 0:18:43.680 --> 0:18:45.960 wrong so far. UM. I think it's going to take time, 0:18:45.960 --> 0:18:47.679 But I think it will get there. Uh. And the 0:18:47.720 --> 0:18:49.880 way we look at the world is if people want 0:18:49.880 --> 0:18:52.320 to pay in a certain method, UM, we want to 0:18:52.359 --> 0:18:55.399 make sure Flywire has that method available, whether they're using PayPal, 0:18:55.480 --> 0:18:59.200 American Express, Visa, or their bank or something like Allie 0:18:59.200 --> 0:19:01.639 pay wee chat in China. We want to have all 0:19:01.640 --> 0:19:04.200 those methods there. So, you know, if crypto really takes 0:19:04.240 --> 0:19:07.240 off from a consumer perspective, UM, and the and they're 0:19:07.280 --> 0:19:10.720 looking for a certain cryptocurrency, UM, that's something that Flywire 0:19:10.720 --> 0:19:12.879 would definitely consider. So, Mike, what are some of the 0:19:12.960 --> 0:19:15.600 areas of growth for your company right now? Is more 0:19:15.640 --> 0:19:19.800 and more people transact online. You know, there's there's really 0:19:19.960 --> 0:19:23.600 uh it really falls into three different buckets. Geographic expansion 0:19:23.640 --> 0:19:25.560 for US UH. You know, if you look at the 0:19:25.600 --> 0:19:28.399 verticals were in education, healthcare, and travel, they are truly 0:19:28.440 --> 0:19:32.360 global industries. Uh. And so there are students crossing borders 0:19:32.640 --> 0:19:37.080 to study from places like UM China to Australia or 0:19:37.080 --> 0:19:40.440 New Zealand. Right there's obviously one point one million students 0:19:40.480 --> 0:19:43.919 coming to the United States every year. UM. International patients 0:19:43.920 --> 0:19:46.040 are the same way, They're crossing borders all the time 0:19:46.080 --> 0:19:48.840 for medical care. UH. And and anybody that lives in 0:19:48.840 --> 0:19:51.600 a majorly developed city. Um. You know, all the all 0:19:51.640 --> 0:19:55.000 the top hospitals in the United States have international patient programs. 0:19:55.000 --> 0:19:57.800 So geographic expansion really getting out there and making sure 0:19:57.840 --> 0:20:00.240 more people know about the fly Wire solution. And then 0:20:00.280 --> 0:20:03.760 I would say the second um is around more capabilities. 0:20:03.880 --> 0:20:06.080 Right where our clients asked us to help with cross 0:20:06.119 --> 0:20:09.760 border they're actually now looking because payments get more complicated, 0:20:09.760 --> 0:20:12.760 they're actually looking for us to just offload all their payments, right, 0:20:12.760 --> 0:20:15.800 and so we're starting to expand and do that as well. UM, 0:20:15.840 --> 0:20:19.400 So you've got kind of geographic expansion, you have providing 0:20:19.400 --> 0:20:23.200 more products and services related to payments for existing clients. 0:20:23.520 --> 0:20:25.960 And then it's the vertical expansion. Right. We just launched 0:20:26.000 --> 0:20:29.520 this travel sector a year ago. It's growing over year 0:20:29.560 --> 0:20:31.879 on year for us, and we're helping people as they 0:20:31.920 --> 0:20:34.320 travel around the world just make it easier to pay for, 0:20:34.560 --> 0:20:37.639 you know, an adventure trip or a luxury trip. Mike Massaro, 0:20:37.720 --> 0:20:39.919 thank you so much for being with us. Mike Massaro 0:20:40.000 --> 0:20:43.600 is chief executive officer of fly Wire, based in Boston. 0:20:43.720 --> 0:20:47.919 He is in Boston today for the Fintech Week conference 0:20:47.960 --> 0:20:50.720 and he's participating in it on a panel called a 0:20:50.800 --> 0:21:10.600 personalization of payments and a purpose driven market. There's more 0:21:10.640 --> 0:21:13.919 than a thirty trillion dollars of assets undermanaged that are 0:21:13.960 --> 0:21:18.639 subject to non traditional criteria such as environmental, social governance 0:21:18.640 --> 0:21:22.800 and impact analysis in order to determine where they are 0:21:22.840 --> 0:21:24.719 going to go. Where those dollars are going to go, 0:21:24.760 --> 0:21:28.640 the question is how much does this money actually change 0:21:29.280 --> 0:21:32.080 company behavior or create social value? Here to answer that, 0:21:32.480 --> 0:21:35.840 Vicram Gandhi, Professor at Harvard Business School. He also has 0:21:35.880 --> 0:21:39.160 been an investment banker for twenty three years at Morgan 0:21:39.240 --> 0:21:42.680 Stanley and Credit Swiss. You're also he's also on the 0:21:42.880 --> 0:21:46.879 board a senior advisor to the Canada Pension Plan Investment Board. 0:21:47.240 --> 0:21:49.239 Professor Gandhi, thank you so much for being with us. 0:21:49.240 --> 0:21:52.480 So let's start there. How much social value are these 0:21:52.600 --> 0:21:56.200