1 00:00:13,880 --> 00:00:17,160 Speaker 1: Hello, and welcome to What Goes Up, a weekly markets podcast. 2 00:00:17,400 --> 00:00:20,320 Speaker 1: My name is Mike Reagan. I'm a senior editor at Bloomberg. 3 00:00:19,920 --> 00:00:22,680 Speaker 2: And I'm Moldona Hier, Across asset reporter with Bloomberg. 4 00:00:22,880 --> 00:00:25,279 Speaker 1: And this week on the show, Well, we hope you 5 00:00:25,360 --> 00:00:28,080 Speaker 1: had a good meal before you hit play on this podcast, 6 00:00:28,200 --> 00:00:31,880 Speaker 1: because we're going to be talking about food a lot 7 00:00:32,000 --> 00:00:36,360 Speaker 1: about food, but namely the opportunities and risks on the 8 00:00:36,400 --> 00:00:40,800 Speaker 1: investing table amid a swiftly changing global food supply chain. 9 00:00:41,440 --> 00:00:44,360 Speaker 1: Our guest is an executive at a major asset management 10 00:00:44,360 --> 00:00:47,519 Speaker 1: firm who recently helped write an in depth report on 11 00:00:47,640 --> 00:00:51,680 Speaker 1: this exact subject. But felt before we bring them in, 12 00:00:52,440 --> 00:00:54,160 Speaker 1: I have to ask the big buzz I think on 13 00:00:54,200 --> 00:00:57,680 Speaker 1: this topic lately cultivated. 14 00:00:57,040 --> 00:00:59,920 Speaker 3: Meat, cultivated meat, grown meat. 15 00:01:00,200 --> 00:01:01,120 Speaker 1: You're not a meat eater? 16 00:01:01,400 --> 00:01:04,720 Speaker 2: Correct, No, I'm not, and just the idea really, but 17 00:01:04,880 --> 00:01:07,119 Speaker 2: it excites you like well, I would feel like if 18 00:01:07,160 --> 00:01:09,560 Speaker 2: I were you, it would excite me. Has anybody had 19 00:01:09,640 --> 00:01:10,399 Speaker 2: lab grown meat? 20 00:01:10,720 --> 00:01:14,039 Speaker 1: Someone somewhere has one person? And I think so maybe 21 00:01:14,040 --> 00:01:15,759 Speaker 1: our guest knows the real answer. 22 00:01:15,880 --> 00:01:17,320 Speaker 2: Maybe he has had it. 23 00:01:17,560 --> 00:01:18,600 Speaker 1: We'll see. 24 00:01:18,880 --> 00:01:21,240 Speaker 2: I want to bring him in time or hightt he's 25 00:01:21,280 --> 00:01:24,039 Speaker 2: the chief operating officer for Pigeum. Thank you so much 26 00:01:24,080 --> 00:01:24,800 Speaker 2: for joining us. 27 00:01:25,080 --> 00:01:26,119 Speaker 3: It's a pleasure to be here. 28 00:01:26,200 --> 00:01:27,400 Speaker 2: Have you had lab grown meat? 29 00:01:27,800 --> 00:01:31,440 Speaker 4: I have not had lab grown meat, but very recently, 30 00:01:31,520 --> 00:01:35,560 Speaker 4: the FTA just announced that two companies are allowed to 31 00:01:35,640 --> 00:01:40,520 Speaker 4: start producing lab grown meat in the US and it's safe. 32 00:01:40,600 --> 00:01:42,679 Speaker 4: Until then, the only place you could get lab grown 33 00:01:42,680 --> 00:01:45,840 Speaker 4: meat was Singapore, where they introduced chicken nuggets a couple 34 00:01:45,880 --> 00:01:48,800 Speaker 4: of years ago. So Mike, you may be able to 35 00:01:48,840 --> 00:01:50,680 Speaker 4: have your wish sooner than you think. 36 00:01:50,760 --> 00:01:53,680 Speaker 1: But timer from reading your report, I don't get the 37 00:01:53,720 --> 00:01:56,160 Speaker 1: sense that you and your team are very bullish on 38 00:01:56,200 --> 00:01:59,280 Speaker 1: the concept of cultivated cultivated meat. Talk to us a 39 00:01:59,280 --> 00:02:02,320 Speaker 1: little bit about where you see that space going. 40 00:02:02,400 --> 00:02:04,280 Speaker 2: He said, it's more sizzle than steak. 41 00:02:05,280 --> 00:02:05,960 Speaker 1: That's pretty good. 42 00:02:06,040 --> 00:02:06,960 Speaker 2: Yeah, that's really good. 43 00:02:07,280 --> 00:02:11,240 Speaker 4: That is a podcast worthy pun. Yeah, their whole variety. 44 00:02:11,360 --> 00:02:13,240 Speaker 4: I mean, there are lots of areas we excited about 45 00:02:13,280 --> 00:02:17,160 Speaker 4: investing in, but they're definitely a bit like bitcoin and 46 00:02:17,720 --> 00:02:20,840 Speaker 4: other cryptocurrencies in the crypto space, there are definitely some 47 00:02:21,040 --> 00:02:25,440 Speaker 4: bubbles in the food chain as well, and cultivated meat 48 00:02:25,480 --> 00:02:28,960 Speaker 4: is maybe not a bubble. I think our main issue 49 00:02:29,000 --> 00:02:32,280 Speaker 4: as an investor is it's too early to invest. There 50 00:02:32,280 --> 00:02:35,200 Speaker 4: are literally hundreds of companies around the world that are 51 00:02:35,200 --> 00:02:38,079 Speaker 4: trying to do different kinds of cultivated meat, and it's 52 00:02:38,120 --> 00:02:40,880 Speaker 4: pretty much impossible at this stage to know which one's 53 00:02:40,919 --> 00:02:43,800 Speaker 4: going to win and which one's going to lose. So 54 00:02:43,840 --> 00:02:46,160 Speaker 4: we would say even as a venture capitalist, it's too 55 00:02:46,160 --> 00:02:49,760 Speaker 4: early to go in. There will be some winners over time. 56 00:02:50,120 --> 00:02:52,040 Speaker 4: They're the ones who are going to solve the scale problem. 57 00:02:52,080 --> 00:02:54,480 Speaker 4: It is just so expensive to get that chicken nugget 58 00:02:54,560 --> 00:02:57,839 Speaker 4: or that beef steak cultivated at this point that it's 59 00:02:57,919 --> 00:03:00,120 Speaker 4: just not feasible for it to become a mainstream in 60 00:03:00,200 --> 00:03:01,360 Speaker 4: food item around the world. 61 00:03:01,400 --> 00:03:04,480 Speaker 1: It actually costs some multiple of the real thing at 62 00:03:04,480 --> 00:03:05,919 Speaker 1: this point right way more. 63 00:03:06,000 --> 00:03:08,240 Speaker 4: And the only place where we see progress at this 64 00:03:08,280 --> 00:03:10,920 Speaker 4: point is actually not in that actual finish good where 65 00:03:10,960 --> 00:03:13,440 Speaker 4: you will want those charm marks on your steak and 66 00:03:13,480 --> 00:03:15,800 Speaker 4: you'll want all that flavor, and you won't get that 67 00:03:15,880 --> 00:03:18,400 Speaker 4: in cultivated meat yet. But they are taking things like 68 00:03:18,919 --> 00:03:22,680 Speaker 4: egg whites which go into cakes and pastries or way, 69 00:03:22,800 --> 00:03:25,440 Speaker 4: which is part of how they make yogurt in Israel 70 00:03:25,520 --> 00:03:28,679 Speaker 4: and other places, and that's where cultivated versions of those 71 00:03:28,720 --> 00:03:31,480 Speaker 4: products could be could get cheaper, quicker. So that's why 72 00:03:31,520 --> 00:03:34,000 Speaker 4: we're keeping an eye on first. That's where the first 73 00:03:34,040 --> 00:03:37,360 Speaker 4: investment opportunities will arise. But it's too early. It's not 74 00:03:37,400 --> 00:03:39,480 Speaker 4: a bad opportunity. You just don't want to be ten 75 00:03:39,560 --> 00:03:40,760 Speaker 4: years too early to something. 76 00:03:41,240 --> 00:03:43,120 Speaker 1: I'm already hungry with ol donna. 77 00:03:42,760 --> 00:03:46,320 Speaker 2: I've had the eggless mayonnaise or whatever. It's pretty good, 78 00:03:46,520 --> 00:03:49,680 Speaker 2: is it. Yeah? I know that's slightly different, but you know, 79 00:03:50,120 --> 00:03:53,520 Speaker 2: I can see trends evolving from all of the you know, 80 00:03:53,600 --> 00:03:54,280 Speaker 2: different branches. 81 00:03:54,480 --> 00:03:57,400 Speaker 4: There's a lot of changes in how consumers are behaving 82 00:03:57,440 --> 00:03:59,360 Speaker 4: around the world, and that's actually one of the big 83 00:03:59,400 --> 00:04:03,720 Speaker 4: drivers customent opportunities, including things that are more humane and 84 00:04:03,800 --> 00:04:06,520 Speaker 4: things that are more healthy. So eggless mail would definitely 85 00:04:06,560 --> 00:04:07,480 Speaker 4: fit that category. 86 00:04:07,520 --> 00:04:07,760 Speaker 1: Well. 87 00:04:08,200 --> 00:04:10,920 Speaker 2: Before we talk about all of this and the investment implications, 88 00:04:10,960 --> 00:04:12,880 Speaker 2: I actually want to ask you what made you look 89 00:04:13,000 --> 00:04:16,360 Speaker 2: into food as a topic, especially an investment topic. 90 00:04:17,000 --> 00:04:19,400 Speaker 4: I mean, beyond the fact that I'm a big foodie. 91 00:04:19,440 --> 00:04:23,240 Speaker 4: The reasons we as PGM went into this were a couple. 92 00:04:23,720 --> 00:04:28,200 Speaker 4: We think, first of all, that food is not just 93 00:04:28,240 --> 00:04:31,679 Speaker 4: ten percent of GDP, but forty percent of the labor force. 94 00:04:31,920 --> 00:04:34,080 Speaker 4: So a lot of people work in this industry, and 95 00:04:34,120 --> 00:04:38,120 Speaker 4: we're defining food as from farm to fork and everything 96 00:04:38,160 --> 00:04:41,800 Speaker 4: in between, processing, packaging, preparing the seeds all the way 97 00:04:41,839 --> 00:04:44,479 Speaker 4: to kind of end retail. So it's a big part 98 00:04:44,520 --> 00:04:46,159 Speaker 4: of the labor force, and there's been a lot of 99 00:04:46,160 --> 00:04:49,560 Speaker 4: focus on labor and inflation and so on. So that 100 00:04:49,680 --> 00:04:53,200 Speaker 4: was one driver. But the second one to really write 101 00:04:53,240 --> 00:04:56,560 Speaker 4: this report and to think about its investment implications was 102 00:04:57,320 --> 00:05:00,600 Speaker 4: that we think food is where the energy and this 103 00:05:00,640 --> 00:05:03,760 Speaker 4: whole talk about energy transition was about ten years ago. 104 00:05:03,960 --> 00:05:06,760 Speaker 4: We're like ten years behind in the thinking and it's 105 00:05:06,760 --> 00:05:09,200 Speaker 4: going to catch up because the current food system is 106 00:05:09,240 --> 00:05:12,080 Speaker 4: simply not fit for purpose. It is not going to 107 00:05:12,120 --> 00:05:14,000 Speaker 4: work for our planet. It's not going to work for 108 00:05:14,040 --> 00:05:16,800 Speaker 4: our consumption needs for a variety of reasons that we 109 00:05:16,800 --> 00:05:19,680 Speaker 4: can get into, and that debate on how do we 110 00:05:19,760 --> 00:05:22,359 Speaker 4: transition this, even if it takes twenty thirty years to 111 00:05:22,480 --> 00:05:25,160 Speaker 4: the new food system of the future, has happened their 112 00:05:25,200 --> 00:05:28,599 Speaker 4: carbon transition funds, there's renewable energy, there are opportunities, there's 113 00:05:28,640 --> 00:05:31,200 Speaker 4: Inflation Reduction Act and lots of money going there. It 114 00:05:31,279 --> 00:05:34,359 Speaker 4: hasn't happened to food yet, but we think it's about to. 115 00:05:34,520 --> 00:05:36,320 Speaker 4: And that's why we thought it was an interesting time 116 00:05:36,360 --> 00:05:37,000 Speaker 4: to write about it. 117 00:05:37,080 --> 00:05:40,159 Speaker 1: Yeah, absolutely fascinating topic, and I wonder if that making 118 00:05:40,240 --> 00:05:43,360 Speaker 1: that transition. It's one thing to get people to stop 119 00:05:43,640 --> 00:05:46,880 Speaker 1: driving gasoline cars if you can give them an electric 120 00:05:46,920 --> 00:05:50,599 Speaker 1: car that's just as fast, just as reliable. But food, 121 00:05:50,640 --> 00:05:52,760 Speaker 1: I feel like will be a little bit trickier. And 122 00:05:53,160 --> 00:05:55,919 Speaker 1: one pustion of this report that really caught my interest 123 00:05:56,320 --> 00:05:59,960 Speaker 1: was you talk about when a society becomes more app 124 00:06:00,400 --> 00:06:04,640 Speaker 1: when per capet income goes up, people's diets change, and 125 00:06:04,880 --> 00:06:06,520 Speaker 1: I've found that fascinating. Can you talk to us a 126 00:06:06,560 --> 00:06:09,479 Speaker 1: little bit about what changes in a diet as a 127 00:06:09,560 --> 00:06:12,800 Speaker 1: society sort of gains more income. Yeah. 128 00:06:12,920 --> 00:06:15,360 Speaker 4: Historically, the main reason we needed more food for the 129 00:06:15,400 --> 00:06:17,400 Speaker 4: span it was that there were just more people on it. 130 00:06:17,480 --> 00:06:22,120 Speaker 4: Population grows, everybody needs galleries, more food has to be created. 131 00:06:22,400 --> 00:06:25,200 Speaker 4: But an important shift is happening in one you hit mic, 132 00:06:25,240 --> 00:06:29,200 Speaker 4: which is now we have as perhaps an increasing influence 133 00:06:29,279 --> 00:06:33,000 Speaker 4: is the fact that particularly Asia is developing a new 134 00:06:33,080 --> 00:06:36,080 Speaker 4: emerging middle class and they have the same wants and 135 00:06:36,160 --> 00:06:40,240 Speaker 4: needs and desires as people in develop markets do. And 136 00:06:40,320 --> 00:06:44,080 Speaker 4: that means a not just more calories, but more protein 137 00:06:44,279 --> 00:06:47,159 Speaker 4: and more calories that are increasingly converging with what we 138 00:06:47,200 --> 00:06:50,640 Speaker 4: call the Western diet. So there's more more meat in it, 139 00:06:50,680 --> 00:06:53,919 Speaker 4: there's more chicken in it, there's more more pork in 140 00:06:54,000 --> 00:06:57,520 Speaker 4: that diet. And those are galleries that need to be exported. 141 00:06:58,120 --> 00:07:00,560 Speaker 4: You can't just all get them in via Knam or 142 00:07:00,600 --> 00:07:04,240 Speaker 4: in Thailand or in China. There's much more export supply chains, 143 00:07:04,279 --> 00:07:07,240 Speaker 4: ironically where everybody's trying to simplify them. After COVID are 144 00:07:07,240 --> 00:07:10,200 Speaker 4: going to get more complicated because people want the same 145 00:07:10,240 --> 00:07:12,360 Speaker 4: food in more and more countries of the world rather 146 00:07:12,400 --> 00:07:15,640 Speaker 4: than just the local food, and be that food itself 147 00:07:16,000 --> 00:07:19,040 Speaker 4: has a bigger climate footprint because of all the methane 148 00:07:19,080 --> 00:07:22,000 Speaker 4: and greenhouse gas emissions that come from the farming system, 149 00:07:22,320 --> 00:07:24,600 Speaker 4: and now more people want livestock, which is the key 150 00:07:24,640 --> 00:07:28,680 Speaker 4: creator of greenhouse gases, and see it means much more 151 00:07:28,680 --> 00:07:32,400 Speaker 4: pressures on the governments in these countries to provide the resources, 152 00:07:32,440 --> 00:07:34,920 Speaker 4: to provide the infrastructure so that people can get these 153 00:07:35,000 --> 00:07:38,640 Speaker 4: new forms of Western diets that are frankly maybe a 154 00:07:38,640 --> 00:07:41,840 Speaker 4: little less healthy for them as well definitely more costly, 155 00:07:42,200 --> 00:07:45,240 Speaker 4: require much more importing of things from around the world 156 00:07:45,320 --> 00:07:46,000 Speaker 4: than you did before. 157 00:07:46,000 --> 00:07:47,680 Speaker 3: So it's a pretty radical change. 158 00:07:48,360 --> 00:07:50,640 Speaker 4: And finally it does mean the food system doesn't just 159 00:07:50,720 --> 00:07:53,920 Speaker 4: need to cope with more population, it needs to provide 160 00:07:54,000 --> 00:07:56,640 Speaker 4: many more calories even to each person on the planet. 161 00:07:58,080 --> 00:08:00,600 Speaker 2: So you have all of these different fine one of 162 00:08:00,600 --> 00:08:03,000 Speaker 2: them is that climate change is causing a twelve percent 163 00:08:03,040 --> 00:08:05,640 Speaker 2: of climb and crop yields. So this is just I 164 00:08:05,680 --> 00:08:08,240 Speaker 2: make this point to show that there's really a lot 165 00:08:08,280 --> 00:08:10,960 Speaker 2: of geopolitical implications for this as well. 166 00:08:11,040 --> 00:08:15,560 Speaker 4: Right, Yeah, So the climate interlinkage is actually quite interesting 167 00:08:15,640 --> 00:08:18,560 Speaker 4: and complex because it goes both ways. First of all, 168 00:08:18,800 --> 00:08:22,280 Speaker 4: the fact that climate is changing is changing our food 169 00:08:22,600 --> 00:08:25,440 Speaker 4: supply chains. You know, you have less fish in the 170 00:08:25,480 --> 00:08:28,720 Speaker 4: ocean when oceans are warming up. You have new kinds 171 00:08:28,800 --> 00:08:33,680 Speaker 4: of fungi. Even if we haven't seen the HBO TV. 172 00:08:33,520 --> 00:08:35,679 Speaker 2: Series watching it right now, it's so scary. 173 00:08:35,840 --> 00:08:38,839 Speaker 4: Then new kinds of fungi, the new kinds of insects, 174 00:08:38,880 --> 00:08:43,640 Speaker 4: and that require new pesticides. Because of warming climate change 175 00:08:44,160 --> 00:08:47,320 Speaker 4: and with heat, it's harder for labor to work in 176 00:08:47,360 --> 00:08:49,880 Speaker 4: conditions in many kind of parts of the world where 177 00:08:49,920 --> 00:08:53,560 Speaker 4: you do have manual labor, eighty percent of Indian farms, 178 00:08:53,559 --> 00:08:57,199 Speaker 4: for example, and crop yields have declined. So, first of all, 179 00:08:57,240 --> 00:08:59,560 Speaker 4: you've got this effect from a change in climate. A 180 00:08:59,600 --> 00:09:04,000 Speaker 4: more stream climate, reduces crop yields, creates more variability, adds 181 00:09:04,040 --> 00:09:07,080 Speaker 4: new threats and risks. And then second you've got the 182 00:09:07,120 --> 00:09:09,439 Speaker 4: fact that the food system as we have it today 183 00:09:09,679 --> 00:09:12,920 Speaker 4: it self changes the climate. Something like thirty percent of 184 00:09:12,960 --> 00:09:16,600 Speaker 4: greenhouse gas emissions which cause global heating come from the 185 00:09:16,640 --> 00:09:20,920 Speaker 4: food system. Seventy percent of freshwater consumption. Is not all 186 00:09:20,960 --> 00:09:23,560 Speaker 4: of us drinking waters to you know, have our two 187 00:09:23,559 --> 00:09:26,200 Speaker 4: to six liters a day, but it is because the 188 00:09:26,240 --> 00:09:29,120 Speaker 4: food system needs it to grow crops and so on 189 00:09:29,200 --> 00:09:32,079 Speaker 4: and so forth. So you've got a very complicated inter 190 00:09:32,160 --> 00:09:36,160 Speaker 4: relationship and frankly, it's one that's unsustainable and need some 191 00:09:36,240 --> 00:09:39,080 Speaker 4: new ways to thinking about food to create a food 192 00:09:39,080 --> 00:09:40,920 Speaker 4: system that can meet our needs for the future. 193 00:09:41,480 --> 00:09:43,400 Speaker 1: So talk to us about some of the new ways 194 00:09:43,440 --> 00:09:46,760 Speaker 1: what's on the horizon that will alleviate some of these 195 00:09:46,760 --> 00:09:47,880 Speaker 1: issues that you're talking about. 196 00:09:48,240 --> 00:09:52,480 Speaker 4: So one that comes to mind is how agricultures change 197 00:09:52,559 --> 00:09:56,800 Speaker 4: what we call ag tech, And there's precision agriculture, which 198 00:09:56,840 --> 00:10:00,040 Speaker 4: is about how can you really take sensors and and 199 00:10:00,360 --> 00:10:04,600 Speaker 4: data from satellites and information on what's happening in the 200 00:10:04,720 --> 00:10:09,080 Speaker 4: roots of crops and make that available to farmers around 201 00:10:09,160 --> 00:10:12,160 Speaker 4: the world so that they can grow crops more quickly, 202 00:10:12,320 --> 00:10:15,680 Speaker 4: more productively at a higher level. Frankly, there hasn't really 203 00:10:15,720 --> 00:10:18,840 Speaker 4: been a revolution outside of the US and Latin America. 204 00:10:18,880 --> 00:10:23,320 Speaker 4: So in the big grain baskets of Ukraine and Asia 205 00:10:23,360 --> 00:10:26,760 Speaker 4: and Africa since the Green Revolution of the nineteen sixties, 206 00:10:27,080 --> 00:10:29,160 Speaker 4: that was when a lot of new seeds were introduced. 207 00:10:29,200 --> 00:10:30,800 Speaker 4: As long as you had a lot of irrigation, you 208 00:10:30,840 --> 00:10:32,800 Speaker 4: could really raise your crop output. 209 00:10:33,040 --> 00:10:34,559 Speaker 3: But in those parts of the world you. 210 00:10:34,520 --> 00:10:37,880 Speaker 4: Still have very manual, small farm holdings, and there really 211 00:10:37,920 --> 00:10:41,640 Speaker 4: hasn't been another revolution. The mechanization hasn't happened, and this 212 00:10:41,720 --> 00:10:44,960 Speaker 4: next generation technology hasn't come there. So you now have 213 00:10:45,040 --> 00:10:48,280 Speaker 4: this sort of world where US and Latin American farms 214 00:10:48,280 --> 00:10:52,640 Speaker 4: are taking all this new precision agriculture. You have seed throwing, 215 00:10:52,720 --> 00:10:55,800 Speaker 4: you have plantation, you have knowledge about when you need 216 00:10:55,840 --> 00:10:59,200 Speaker 4: to water, plants available at the fingertips of farmers in 217 00:10:59,240 --> 00:11:02,880 Speaker 4: these markets. And then you've got this like massive gulf 218 00:11:02,960 --> 00:11:07,080 Speaker 4: and another universe where things are still very basic. It's 219 00:11:07,200 --> 00:11:10,640 Speaker 4: manu labor. They may be like bullock drawn guards that 220 00:11:10,679 --> 00:11:14,040 Speaker 4: are kind of harvesting fields, and there is where there's 221 00:11:14,080 --> 00:11:17,080 Speaker 4: a massive opportunity to take all this data, take all 222 00:11:17,120 --> 00:11:20,040 Speaker 4: this information, get in on mobile phones because people don't 223 00:11:20,080 --> 00:11:25,000 Speaker 4: have fancy computers in emerging markets, and really revolutionize agriculture 224 00:11:25,040 --> 00:11:27,199 Speaker 4: and create much more food and galleries for the world. 225 00:11:28,120 --> 00:11:30,760 Speaker 2: Okay, so you said investing in the food system provides 226 00:11:30,800 --> 00:11:34,320 Speaker 2: opportunities for investors to further ESG goals and have a 227 00:11:34,320 --> 00:11:38,000 Speaker 2: measurable impact. So maybe can you talk about the ESG 228 00:11:38,160 --> 00:11:38,880 Speaker 2: aspect of this. 229 00:11:40,160 --> 00:11:40,439 Speaker 1: Sure. 230 00:11:40,559 --> 00:11:44,240 Speaker 4: So again, it's a great analogy to energy ten years ago, 231 00:11:44,720 --> 00:11:47,240 Speaker 4: where the first sort of reaction to energy was we're 232 00:11:47,240 --> 00:11:49,080 Speaker 4: going to stay away from the oil and gas sect 233 00:11:49,120 --> 00:11:52,520 Speaker 4: and we're just going to focus on solar and renewables 234 00:11:52,559 --> 00:11:56,520 Speaker 4: and hydro electrics. And then it became clear that solar 235 00:11:56,600 --> 00:11:59,720 Speaker 4: and wind and hydrop on its own wasn't going to 236 00:11:59,720 --> 00:12:02,760 Speaker 4: meet our need for the next twenty thirty forty years, 237 00:12:02,960 --> 00:12:05,800 Speaker 4: and so the carbon transition required investors not to just 238 00:12:05,880 --> 00:12:10,479 Speaker 4: separate and disengage from all the oil and gas producers, 239 00:12:10,880 --> 00:12:14,440 Speaker 4: but find what I like to call kind of the 240 00:12:14,440 --> 00:12:17,280 Speaker 4: the not the greenest of the green only, but stay 241 00:12:17,280 --> 00:12:19,440 Speaker 4: away from the brownest of the brown and kind of 242 00:12:19,440 --> 00:12:24,320 Speaker 4: find the in between. Khaki renewable and fuel providers, including 243 00:12:24,400 --> 00:12:27,280 Speaker 4: Shell and BP and the big companies, to encourage them 244 00:12:27,280 --> 00:12:32,240 Speaker 4: to make the transition. And the opportunity for the ESG 245 00:12:32,679 --> 00:12:36,840 Speaker 4: investor is not to move away from beef, not to 246 00:12:36,920 --> 00:12:41,040 Speaker 4: move away from livestock cultivation, but recognize that the livelihoods 247 00:12:41,080 --> 00:12:44,040 Speaker 4: of billions of people around the world and the calorie 248 00:12:44,040 --> 00:12:46,800 Speaker 4: needs of a rising Asia that does need its middle 249 00:12:46,800 --> 00:12:49,840 Speaker 4: class to be fed, requires that for a while, we 250 00:12:49,960 --> 00:12:54,240 Speaker 4: will need all these forms of production to be maximized. 251 00:12:54,520 --> 00:12:57,160 Speaker 4: But find better ways of doing that, find greener ways 252 00:12:57,160 --> 00:13:01,200 Speaker 4: of doing that. So engage rather than disage, but really 253 00:13:01,280 --> 00:13:04,400 Speaker 4: find Okay, if they're nitrogen visk fertilizers, which are not 254 00:13:04,440 --> 00:13:07,680 Speaker 4: particularly good for the environment, what's the next best option. 255 00:13:08,400 --> 00:13:11,040 Speaker 4: If somebody is using up too much water for their 256 00:13:11,040 --> 00:13:13,840 Speaker 4: farmland because they don't have modern technology, how do we 257 00:13:13,880 --> 00:13:17,640 Speaker 4: get modern technology there? And that requires ESG to engage 258 00:13:17,640 --> 00:13:20,440 Speaker 4: in all these sectors, not stay away. Another great example 259 00:13:20,520 --> 00:13:25,079 Speaker 4: is packaging, Like you still need packaging. People in developing 260 00:13:25,120 --> 00:13:28,840 Speaker 4: countries in emerging frontier markets want their food to be 261 00:13:28,880 --> 00:13:31,320 Speaker 4: as safe as we have in the US, and to 262 00:13:31,400 --> 00:13:34,400 Speaker 4: do that you need various kinds of safe modern packaging. 263 00:13:34,640 --> 00:13:37,679 Speaker 4: How do you invest in that in greener packaging, less packaging, 264 00:13:37,960 --> 00:13:40,280 Speaker 4: not withdraw from the sector. So we think there's a 265 00:13:40,360 --> 00:13:43,000 Speaker 4: huge role for the ESG sector, and I would say 266 00:13:43,080 --> 00:13:45,760 Speaker 4: even bigger data gap than exists in the energy world. 267 00:13:45,800 --> 00:13:48,560 Speaker 4: There's very little data on what's good what's bad. We 268 00:13:48,679 --> 00:13:51,880 Speaker 4: all confused as consumers. Investors are equally confused because the 269 00:13:51,920 --> 00:13:54,920 Speaker 4: data doesn't exist, and we really need to ask all 270 00:13:54,960 --> 00:13:58,000 Speaker 4: the food companies to start providing the same data that 271 00:13:58,040 --> 00:14:00,800 Speaker 4: the energy sector is now providing that people can make 272 00:14:00,800 --> 00:14:04,320 Speaker 4: informed decisions and investors can make informed decisions on ESG good. 273 00:14:05,040 --> 00:14:07,520 Speaker 1: I want to get back to that notion of geopolitics 274 00:14:07,640 --> 00:14:11,480 Speaker 1: as well, and obviously, from time to time, food security 275 00:14:11,520 --> 00:14:13,959 Speaker 1: can be a major geopolitical issue, you know, I'm thinking 276 00:14:14,000 --> 00:14:17,480 Speaker 1: of the Arab Spring a decade ago, even just more 277 00:14:17,520 --> 00:14:22,160 Speaker 1: recently with the war in Ukraine. Ukraine obviously a major 278 00:14:22,160 --> 00:14:24,920 Speaker 1: grain producer and there were all sorts of questions about 279 00:14:25,040 --> 00:14:29,479 Speaker 1: supplies from Ukraine. Do you see this sort of geopolitical 280 00:14:29,960 --> 00:14:33,800 Speaker 1: deglobalization that's happening in a lot of industries. Is that 281 00:14:33,840 --> 00:14:37,080 Speaker 1: going to hit the food the global food industry as well, 282 00:14:37,200 --> 00:14:40,120 Speaker 1: or is this sort of hunger for meat and protein 283 00:14:40,280 --> 00:14:43,360 Speaker 1: enough to allow the world to kind of stick closer 284 00:14:43,400 --> 00:14:46,760 Speaker 1: together when it comes to food, if not semiconductors and 285 00:14:46,800 --> 00:14:49,040 Speaker 1: other industries. You know, how do you see it going 286 00:14:49,520 --> 00:14:52,720 Speaker 1: as far as geopolitics and food is Is it going 287 00:14:52,760 --> 00:14:55,440 Speaker 1: to be a local market more so, or is there 288 00:14:55,760 --> 00:15:00,920 Speaker 1: potential for sort of multinational dominance from some multi na corporations. 289 00:15:01,880 --> 00:15:03,960 Speaker 4: So maybe a good chance to step back, and I'd 290 00:15:04,000 --> 00:15:07,560 Speaker 4: say we found four reasons why investors should care about 291 00:15:07,560 --> 00:15:10,800 Speaker 4: this food system, even if they're not foodies. And the 292 00:15:10,840 --> 00:15:12,960 Speaker 4: first one is if they care about ESG. 293 00:15:12,760 --> 00:15:14,000 Speaker 3: And many, many, many do. 294 00:15:14,680 --> 00:15:17,640 Speaker 4: There's a real connection between climate change and the food 295 00:15:17,680 --> 00:15:20,080 Speaker 4: system and their ways to help make it a better 296 00:15:20,120 --> 00:15:25,240 Speaker 4: food system. The second factor was simply the incredible investment 297 00:15:25,280 --> 00:15:28,360 Speaker 4: opportunities in the food sector, and we can talk about 298 00:15:28,360 --> 00:15:32,120 Speaker 4: a few of them that investors, regardless of their motivations, 299 00:15:32,120 --> 00:15:34,480 Speaker 4: may want to capture the risk return opportunities that are 300 00:15:34,480 --> 00:15:37,840 Speaker 4: available to them. There The third, which we haven't talked 301 00:15:37,840 --> 00:15:41,000 Speaker 4: about yet, is just how inextricably linked food prices and 302 00:15:41,040 --> 00:15:44,240 Speaker 4: inflation have become and therefore food supply and food demand, 303 00:15:44,240 --> 00:15:46,680 Speaker 4: what it means for food prices and therefore what it 304 00:15:46,720 --> 00:15:48,960 Speaker 4: means for inflation and all the headlines and all the 305 00:15:49,000 --> 00:15:52,360 Speaker 4: monetary policy decisions as you try and bring back inflation 306 00:15:52,520 --> 00:15:55,320 Speaker 4: in Europe, in the US and many countries around the world, 307 00:15:55,880 --> 00:15:58,320 Speaker 4: and you've got to figure out the food equation piece 308 00:15:58,360 --> 00:16:00,760 Speaker 4: of that. And the fourth is the one you mentioned, Mike, 309 00:16:00,800 --> 00:16:04,200 Speaker 4: which is if you want to understand geopolitics, both within 310 00:16:04,240 --> 00:16:07,400 Speaker 4: a country and between countries, you've got to understand food 311 00:16:07,440 --> 00:16:10,720 Speaker 4: because it's such a sort of primal important necessity that 312 00:16:10,840 --> 00:16:15,880 Speaker 4: everybody wants, and across borders, it's driven things. I think 313 00:16:15,920 --> 00:16:18,720 Speaker 4: it's come to like for two reasons. One, COVID and 314 00:16:18,840 --> 00:16:22,080 Speaker 4: everybody recognized that their food supply chains were too scattered 315 00:16:22,120 --> 00:16:25,560 Speaker 4: and too far away. And since COVID, I think food 316 00:16:25,600 --> 00:16:30,239 Speaker 4: security has become national security. And you've seen, for example, 317 00:16:30,520 --> 00:16:36,160 Speaker 4: in Congress lots of discussions around, for example, should Chinese 318 00:16:36,520 --> 00:16:41,440 Speaker 4: companies own US agricultural land, And that same debate is 319 00:16:41,480 --> 00:16:44,920 Speaker 4: being echoed around Latin America and Africa and Asia and 320 00:16:44,960 --> 00:16:48,160 Speaker 4: other parts where they're Chinese owners of the land system. 321 00:16:48,920 --> 00:16:51,840 Speaker 4: And then you're seeing it also playing out domestically. You 322 00:16:51,880 --> 00:16:53,880 Speaker 4: see it in Peru, you see it in India, you 323 00:16:53,920 --> 00:16:57,360 Speaker 4: see it in France, where farmers are a very important lobby, 324 00:16:57,920 --> 00:17:01,320 Speaker 4: and when you hit farms cities, which are massive in 325 00:17:01,360 --> 00:17:04,480 Speaker 4: some of these countries, you really get a massive political reaction. 326 00:17:04,920 --> 00:17:09,080 Speaker 4: So it's a big domestic stabilizing or destabilizing food potatoes 327 00:17:09,080 --> 00:17:11,280 Speaker 4: go up twenty percent in India, you could have a 328 00:17:11,320 --> 00:17:14,120 Speaker 4: new government at your hands, so it really makes a difference. 329 00:17:14,520 --> 00:17:17,760 Speaker 4: And then geopolitically, I think between COVID and Ukraine, there's 330 00:17:17,760 --> 00:17:20,320 Speaker 4: been a recognition that we need to figure out where 331 00:17:20,320 --> 00:17:22,560 Speaker 4: these supply chains are because we've got to get food 332 00:17:22,560 --> 00:17:27,320 Speaker 4: security for our own populations. 333 00:17:30,920 --> 00:17:34,240 Speaker 2: What is it about the food space as an investment topic? 334 00:17:34,400 --> 00:17:38,159 Speaker 2: Is it that there are these opportunities there or is 335 00:17:38,200 --> 00:17:40,760 Speaker 2: it that it's a space that not very many investors 336 00:17:40,800 --> 00:17:43,639 Speaker 2: have been thinking about. Hence you can maybe find some 337 00:17:44,400 --> 00:17:47,720 Speaker 2: hidden companies or investment opportunities. 338 00:17:47,880 --> 00:17:49,640 Speaker 3: It's probably a little bit of both. 339 00:17:49,640 --> 00:17:52,840 Speaker 4: Fieldane and I think they're definitely opportunities and I think 340 00:17:53,000 --> 00:17:56,960 Speaker 4: compared to certain other sectors that probably underrecognized and underappreciated, 341 00:17:57,000 --> 00:17:59,159 Speaker 4: which is one of the reasons Pijeum wrote this report. 342 00:17:59,600 --> 00:18:02,960 Speaker 4: And the unique ability because we have a big realistic 343 00:18:03,000 --> 00:18:06,240 Speaker 4: team private credit, we do fundamental equity, we do bonds, 344 00:18:06,520 --> 00:18:08,399 Speaker 4: so we kind of approach the topic from four to 345 00:18:08,400 --> 00:18:12,800 Speaker 4: five different anglesing where's the opportunity. So, for example, one 346 00:18:12,800 --> 00:18:16,159 Speaker 4: opportunity is cold storage. Everybody thinks of real estate and 347 00:18:16,200 --> 00:18:18,200 Speaker 4: the first thing that comes to mind is offices, and 348 00:18:18,520 --> 00:18:20,720 Speaker 4: nobody is going to offices any longer in the US 349 00:18:20,760 --> 00:18:23,399 Speaker 4: and Europe, and there's a crisis in the office sector, 350 00:18:23,480 --> 00:18:26,159 Speaker 4: and I think the are pressure is there. But cold 351 00:18:26,200 --> 00:18:30,159 Speaker 4: storage and the logistics and distribution that you need around 352 00:18:30,160 --> 00:18:33,840 Speaker 4: cold storage is a very significant opportunity with very high 353 00:18:33,920 --> 00:18:37,760 Speaker 4: growth rates in the real estate sector, that entire ecosystem 354 00:18:37,840 --> 00:18:41,280 Speaker 4: of real assets and then the storage for them is 355 00:18:41,280 --> 00:18:44,040 Speaker 4: a big opportunity. And it's really linked to the fact 356 00:18:44,119 --> 00:18:48,040 Speaker 4: that forty percent of food around the world is just wasted. 357 00:18:48,640 --> 00:18:51,680 Speaker 4: In the US, in Europe, it's wasted at the end 358 00:18:51,680 --> 00:18:53,760 Speaker 4: the end consumers all of us are probably not as 359 00:18:53,760 --> 00:18:57,080 Speaker 4: efficient with food as we should be, and in emerging 360 00:18:57,119 --> 00:19:00,359 Speaker 4: in frontier markets, it's all happening in production. Getting it 361 00:19:00,359 --> 00:19:02,840 Speaker 4: from the farm to the retail storefront is where you 362 00:19:02,880 --> 00:19:05,720 Speaker 4: lose all the food, and cold storage can absolutely be 363 00:19:05,760 --> 00:19:07,840 Speaker 4: critical in changing that. So we see that as very 364 00:19:07,920 --> 00:19:11,320 Speaker 4: much as a global opportunity. On the other end of 365 00:19:11,359 --> 00:19:15,560 Speaker 4: the spectrum, for debt holders, for bonds. There's some really 366 00:19:15,640 --> 00:19:19,960 Speaker 4: safe spaces. The consumption of energy, drinks and alcohol in 367 00:19:20,480 --> 00:19:24,399 Speaker 4: Kansas going up. You've seen all those apple sauce and 368 00:19:24,480 --> 00:19:27,760 Speaker 4: baby food things, and those pouchers that are openable and sealable, 369 00:19:28,200 --> 00:19:32,359 Speaker 4: so plastic manufacturers of these fairly specialized food equipments that 370 00:19:32,440 --> 00:19:35,439 Speaker 4: you really can't get other people to make very quickly 371 00:19:35,680 --> 00:19:39,080 Speaker 4: are a very safe place to be. Another good example 372 00:19:39,240 --> 00:19:41,239 Speaker 4: of a safe place to be where there's lots of 373 00:19:41,240 --> 00:19:45,680 Speaker 4: long term opportunity is all the franchise holders in developing countries, 374 00:19:45,760 --> 00:19:50,320 Speaker 4: the pepsicola butlers, the people who are making well recognized 375 00:19:50,320 --> 00:19:54,280 Speaker 4: foods and big emerging markets. Everybody's gearing towards them that 376 00:19:54,400 --> 00:19:57,920 Speaker 4: don't want to take a risk with smaller, less known brands. 377 00:19:58,320 --> 00:20:00,720 Speaker 4: And then we started this discussion with meat, and it's 378 00:20:00,720 --> 00:20:03,840 Speaker 4: probably worth mentioning it again again. As a dethold, you're 379 00:20:03,840 --> 00:20:06,120 Speaker 4: not going to get like equity like returns. Don't look 380 00:20:06,119 --> 00:20:09,240 Speaker 4: for cryptocurrency type returns, which by the way, don't exist 381 00:20:09,240 --> 00:20:10,080 Speaker 4: in cryptocurrency. 382 00:20:10,119 --> 00:20:11,320 Speaker 3: Don't look for them. Heyah. 383 00:20:11,520 --> 00:20:16,040 Speaker 4: But in meat production and the more humane, the more 384 00:20:16,280 --> 00:20:20,040 Speaker 4: esg friendly end of meat production, there's definitely another opportunity 385 00:20:20,080 --> 00:20:23,160 Speaker 4: because we've seen with plant based meats. If somebodep talked 386 00:20:23,200 --> 00:20:26,960 Speaker 4: about impossible burger, we've seen with cultivated meats at the 387 00:20:27,000 --> 00:20:30,200 Speaker 4: beginning of this discussion, they're either not going to succeed 388 00:20:30,280 --> 00:20:34,199 Speaker 4: based on demand and appetite, or they're going to be 389 00:20:34,200 --> 00:20:37,040 Speaker 4: a long way away, and therefore these core opportunities in 390 00:20:37,320 --> 00:20:38,399 Speaker 4: those sectors exist. 391 00:20:39,320 --> 00:20:42,040 Speaker 1: Yeah, there was so much hype about plant based meat 392 00:20:42,119 --> 00:20:44,080 Speaker 1: for a while. They're impossible burgers. 393 00:20:44,320 --> 00:20:46,200 Speaker 2: I like them, do you? Yeah? 394 00:20:46,400 --> 00:20:48,119 Speaker 1: I think you're in the minority, though, I don't think 395 00:20:48,119 --> 00:20:50,679 Speaker 1: they're really really touching on it. Seems like for a 396 00:20:50,680 --> 00:20:52,960 Speaker 1: while everyone was willing to try it. You know, the 397 00:20:53,720 --> 00:20:56,800 Speaker 1: whopper had an impossible whopper. What are you supposed to 398 00:20:57,400 --> 00:21:00,399 Speaker 1: happen there time? Or is it? Are they not quite 399 00:21:00,840 --> 00:21:04,679 Speaker 1: there yet where regular meat eaters will swap in an 400 00:21:04,680 --> 00:21:08,480 Speaker 1: impossible burger? What is sort of the headwind to plant 401 00:21:08,560 --> 00:21:11,720 Speaker 1: based meat that sort of didn't allow it to live 402 00:21:11,760 --> 00:21:12,280 Speaker 1: up to the hype. 403 00:21:12,359 --> 00:21:14,639 Speaker 4: I'd agreeved it did not live up to the hype. 404 00:21:14,640 --> 00:21:19,080 Speaker 4: There was all the headline, all the headlines around burggging 405 00:21:19,359 --> 00:21:24,520 Speaker 4: and McDonald's and everybody introducing plant based meats on their menu, 406 00:21:25,040 --> 00:21:27,840 Speaker 4: and I think some of them have silently retired that offering, 407 00:21:27,880 --> 00:21:30,320 Speaker 4: But in any case, the market is still a minuscule 408 00:21:30,400 --> 00:21:34,240 Speaker 4: portion of the meat market. It hasn't taken off, and 409 00:21:34,760 --> 00:21:37,520 Speaker 4: the stock prices of these companies have not lived up 410 00:21:37,520 --> 00:21:40,280 Speaker 4: to the hopes that some people had pinned on them. 411 00:21:40,680 --> 00:21:43,119 Speaker 4: And I think it comes down to something very simple, 412 00:21:43,240 --> 00:21:48,120 Speaker 4: which is people like the taste and the flavor and 413 00:21:48,280 --> 00:21:53,840 Speaker 4: the consistency of actual products right, and plant based meat 414 00:21:53,880 --> 00:21:57,119 Speaker 4: doesn't quite do it. And frankly, there might be more 415 00:21:57,160 --> 00:22:01,160 Speaker 4: opportunity in cultivated meat again not a vestment opportunity now 416 00:22:01,160 --> 00:22:04,080 Speaker 4: in the long term there And I'll tell you but 417 00:22:04,160 --> 00:22:06,640 Speaker 4: another thing that I think got a little overhype, which 418 00:22:06,720 --> 00:22:09,840 Speaker 4: is vertical farming. This is farming that doesn't happen in 419 00:22:09,880 --> 00:22:13,119 Speaker 4: a big field in Kansas, but is happening in an 420 00:22:13,200 --> 00:22:16,200 Speaker 4: urban center. Could be outside New York City, could be 421 00:22:16,240 --> 00:22:20,200 Speaker 4: outside Jakarta and Indonesia. Imagine an urban center, and you're 422 00:22:20,240 --> 00:22:23,240 Speaker 4: farming in a building where all the kind of factors 423 00:22:23,240 --> 00:22:25,879 Speaker 4: of production, all the things that create the end and 424 00:22:26,119 --> 00:22:30,760 Speaker 4: farm produce, is being provided by mechanically or digitally. So 425 00:22:30,800 --> 00:22:33,360 Speaker 4: you've got lighting and water that's fed to a vertical 426 00:22:33,440 --> 00:22:35,880 Speaker 4: farm that's grown in a small space in a peri 427 00:22:35,960 --> 00:22:39,680 Speaker 4: urban or urban location, and there was lots of hope 428 00:22:39,680 --> 00:22:43,359 Speaker 4: that this would change both food shortages and create a 429 00:22:43,440 --> 00:22:46,800 Speaker 4: new way of growing that was more sustainable. And the 430 00:22:46,840 --> 00:22:48,880 Speaker 4: honest truth is, while you know, I think it's still 431 00:22:48,920 --> 00:22:53,040 Speaker 4: a worthy social endeavor, it simply means that when the 432 00:22:53,040 --> 00:22:57,160 Speaker 4: most expensive factor of production in farming, which is light, 433 00:22:57,760 --> 00:23:00,760 Speaker 4: doesn't come for free as it does on big farms 434 00:23:00,880 --> 00:23:03,439 Speaker 4: or small farms around the world, but has to be 435 00:23:03,480 --> 00:23:07,800 Speaker 4: created by using up energy, it's no longer cost efficient 436 00:23:07,920 --> 00:23:11,399 Speaker 4: to create it that way, and therefore impossibly hard to 437 00:23:11,520 --> 00:23:15,240 Speaker 4: scale it. And that makes vertical farming not a great 438 00:23:15,280 --> 00:23:18,520 Speaker 4: investment opportunity at scale for investors. Of course, if they're 439 00:23:18,560 --> 00:23:21,000 Speaker 4: only looking for ESG goals, it might be, but from 440 00:23:21,000 --> 00:23:24,320 Speaker 4: a risk return perspective, like plant based meat, it hasn't 441 00:23:24,359 --> 00:23:25,040 Speaker 4: quite lived up. 442 00:23:24,960 --> 00:23:25,560 Speaker 3: To the hype. 443 00:23:26,000 --> 00:23:27,679 Speaker 2: I think I read a story they were trying to 444 00:23:27,880 --> 00:23:32,160 Speaker 2: grow strawberries this way in Newark, I think in New Jersey. Yeah, 445 00:23:32,520 --> 00:23:35,639 Speaker 2: but they were super expensive, right, they were really expensive. 446 00:23:35,880 --> 00:23:36,600 Speaker 3: Some of the stuff. 447 00:23:36,600 --> 00:23:38,440 Speaker 4: I've had a lot, and we have some very good 448 00:23:38,560 --> 00:23:41,879 Speaker 4: vertical farms in Newark because PGUM is headquartered there in 449 00:23:41,960 --> 00:23:44,880 Speaker 4: New Jersey. Some of the produce is really really good 450 00:23:45,359 --> 00:23:48,440 Speaker 4: and fresh, and it gets to consumers much quicker than 451 00:23:48,480 --> 00:23:50,560 Speaker 4: you know, your whole foods might if it's coming from 452 00:23:50,640 --> 00:23:54,000 Speaker 4: you know, three thousand miles away. But simply the cost 453 00:23:54,080 --> 00:23:55,960 Speaker 4: per unit isn't isn't there yet? 454 00:23:56,200 --> 00:23:59,960 Speaker 1: Yeah, you threw out a number there, and I remember 455 00:24:00,040 --> 00:24:02,960 Speaker 1: reading this and you report that is kind of mind 456 00:24:03,000 --> 00:24:07,119 Speaker 1: boggling to me. And that is forty percent of food 457 00:24:08,200 --> 00:24:11,480 Speaker 1: is wasted at some point in the supply chain between 458 00:24:11,480 --> 00:24:15,679 Speaker 1: production and getting to your refrigerator. I suppose to me, 459 00:24:15,960 --> 00:24:19,280 Speaker 1: if you believe in efficient markets, that seems like, wow, 460 00:24:19,480 --> 00:24:23,480 Speaker 1: there seems to be an opportunity just in reclaiming that 461 00:24:23,560 --> 00:24:25,560 Speaker 1: lost food. Am I crazy to think that? Is there 462 00:24:25,600 --> 00:24:29,160 Speaker 1: any sort of effort to say, hey, wait a minute, 463 00:24:29,359 --> 00:24:31,800 Speaker 1: where's all this food going? How do we reduce that 464 00:24:31,880 --> 00:24:33,880 Speaker 1: forty percent? Or how do we capitalize on that? 465 00:24:34,920 --> 00:24:37,720 Speaker 4: There are the one I feel has most promises. What's 466 00:24:37,720 --> 00:24:42,159 Speaker 4: happening in countries mainly emerging markets, frontier markets, But a 467 00:24:42,200 --> 00:24:44,840 Speaker 4: lot of food has grown where the food is lost, 468 00:24:44,880 --> 00:24:47,520 Speaker 4: and that wastage happens in trying to get it to you, 469 00:24:47,680 --> 00:24:51,320 Speaker 4: the end consumer. Yeah, and somewhere in that chain, either 470 00:24:51,400 --> 00:24:53,879 Speaker 4: at the farm, or in the storage at that farm, 471 00:24:54,000 --> 00:24:56,520 Speaker 4: or in the road transportation to get it to the city, 472 00:24:56,920 --> 00:24:58,800 Speaker 4: to move it from the warehouse in the city to 473 00:24:58,920 --> 00:25:02,120 Speaker 4: the end retail consum A lot of food gets wasted 474 00:25:02,119 --> 00:25:04,840 Speaker 4: in the process, and a lot of work is happening, 475 00:25:04,880 --> 00:25:08,600 Speaker 4: whether it's the World Bank and the development institutions or 476 00:25:09,119 --> 00:25:13,200 Speaker 4: venture capitalists, but the big food companies are really trying 477 00:25:13,200 --> 00:25:16,240 Speaker 4: to cut down that waste. And that's about the kinds 478 00:25:16,240 --> 00:25:19,560 Speaker 4: of seeds you use. It's about cold storage and the 479 00:25:19,560 --> 00:25:24,280 Speaker 4: opportunities in cold storage. It's quicker transportation, better retail packaging, 480 00:25:24,680 --> 00:25:26,400 Speaker 4: and I think there is hope for all of us 481 00:25:26,400 --> 00:25:29,960 Speaker 4: that we'll cut food wastage. There and eight hundred million 482 00:25:30,040 --> 00:25:33,560 Speaker 4: people who don't have enough food to eat as their 483 00:25:33,600 --> 00:25:36,199 Speaker 4: need every day. So there's a big opportunity not just 484 00:25:36,200 --> 00:25:39,280 Speaker 4: for investors, but probably also to create a better planet 485 00:25:39,320 --> 00:25:39,760 Speaker 4: we can be. 486 00:25:39,680 --> 00:25:41,880 Speaker 3: Proud of if you attack that absolutely. 487 00:25:41,920 --> 00:25:45,159 Speaker 4: The second piece is in the US, in our market, 488 00:25:45,280 --> 00:25:49,000 Speaker 4: in Europe, in develop markets where most of the food 489 00:25:49,119 --> 00:25:53,400 Speaker 4: is wasted at the restaurants or in the end household, 490 00:25:53,760 --> 00:25:55,960 Speaker 4: and that I think MIC is much harder to change. 491 00:25:56,000 --> 00:25:59,600 Speaker 4: That's changing end consumer behaviors. You are seeing an attempt 492 00:25:59,640 --> 00:26:02,320 Speaker 4: to take food waste and turn it into process food. 493 00:26:02,840 --> 00:26:06,040 Speaker 4: And you are seeing companies with names like misfit or 494 00:26:06,040 --> 00:26:08,000 Speaker 4: imperfect in it who are trying to take all the 495 00:26:08,000 --> 00:26:10,600 Speaker 4: food that is not considered. The tomato is not well 496 00:26:10,640 --> 00:26:13,320 Speaker 4: shaped enough for somebody to buy it and actually package that, 497 00:26:14,080 --> 00:26:16,960 Speaker 4: And I think there is some opportunity there, but I 498 00:26:16,960 --> 00:26:20,600 Speaker 4: think changing consumer behaviors is much harder than introducing cold 499 00:26:20,680 --> 00:26:24,720 Speaker 4: storage and improving the transportation chains and emerging markets to 500 00:26:25,119 --> 00:26:26,160 Speaker 4: counter food waste. 501 00:26:26,240 --> 00:26:28,639 Speaker 1: I'm doing my share. This is the dad in me speaking. 502 00:26:28,800 --> 00:26:31,440 Speaker 2: L don if you eat the ugly tomatoes, well, no. 503 00:26:31,560 --> 00:26:34,200 Speaker 1: If my kids leave forty percent of their dinner on 504 00:26:34,320 --> 00:26:36,560 Speaker 1: the table, I always end up eating it. 505 00:26:36,680 --> 00:26:38,359 Speaker 2: Yeah, I finished all and then I. 506 00:26:38,240 --> 00:26:40,080 Speaker 1: Add three kids. You do the math. I end up 507 00:26:40,080 --> 00:26:43,240 Speaker 1: eating that's one hundred and twenty percent of Yeah. 508 00:26:43,920 --> 00:26:47,199 Speaker 2: Yeah, for sure. But you mentioned emerging markets, and I 509 00:26:47,240 --> 00:26:49,600 Speaker 2: am one, and this is a big question, But like, 510 00:26:49,640 --> 00:26:54,280 Speaker 2: what are the implications for emerging countries or which ones 511 00:26:54,280 --> 00:26:55,120 Speaker 2: are you thinking about. 512 00:26:55,760 --> 00:26:58,359 Speaker 4: I think some of them are really around the fact 513 00:26:58,359 --> 00:27:03,560 Speaker 4: that emerging market consumers want fresher food and safer food, 514 00:27:04,000 --> 00:27:07,720 Speaker 4: and increasingly people both men and women in emerging market 515 00:27:07,760 --> 00:27:10,159 Speaker 4: households are not working at the home. They're working in 516 00:27:10,280 --> 00:27:13,280 Speaker 4: urban centers. Women are increasingly part of the workforce, so 517 00:27:13,320 --> 00:27:16,399 Speaker 4: they're not able to cook food from scratch, so ready 518 00:27:16,440 --> 00:27:19,280 Speaker 4: to make food not necessarily the ghost kitchens that we 519 00:27:19,320 --> 00:27:21,880 Speaker 4: talk about in the US, which is just for delivery, 520 00:27:22,160 --> 00:27:25,919 Speaker 4: but definitely prepackaged safe things that they know that their 521 00:27:26,000 --> 00:27:29,200 Speaker 4: kids can eat, ugly or beautiful tomatoes that they can 522 00:27:29,200 --> 00:27:32,240 Speaker 4: eat and be healthy with, has become a much bigger 523 00:27:32,280 --> 00:27:35,680 Speaker 4: part of the food industry there. They're absolutely investment opportunities 524 00:27:36,280 --> 00:27:39,720 Speaker 4: in that area. I think the second one is the 525 00:27:39,760 --> 00:27:43,639 Speaker 4: supply chains and making available to people the diets that 526 00:27:43,760 --> 00:27:47,359 Speaker 4: now crave, which includes for better or for worse, you know, 527 00:27:47,480 --> 00:27:51,480 Speaker 4: more sugar, more dairy products, and more meat. And how 528 00:27:51,480 --> 00:27:54,800 Speaker 4: do we get to the rising middle class in Asia 529 00:27:55,119 --> 00:27:56,879 Speaker 4: access to these foods, And how do you create a 530 00:27:56,920 --> 00:28:00,000 Speaker 4: food system which at the moment is not fit for purpose, 531 00:28:00,640 --> 00:28:03,800 Speaker 4: that will harm the environment, that doesn't create enough galleries, 532 00:28:03,840 --> 00:28:06,159 Speaker 4: that doesn't get it to the right people. How do 533 00:28:06,160 --> 00:28:08,199 Speaker 4: we kind of shape the supply chains in ways that 534 00:28:08,240 --> 00:28:11,040 Speaker 4: these people get the glories they need while still fighting 535 00:28:11,040 --> 00:28:12,120 Speaker 4: the obesity epidemic. 536 00:28:12,119 --> 00:28:14,320 Speaker 3: While we do all the nutritional education and so on. 537 00:28:14,680 --> 00:28:18,200 Speaker 4: So the big opportunities actually for international growth of foods 538 00:28:18,200 --> 00:28:22,440 Speaker 4: that are increasingly being demanded by rising middle classes in Asia. 539 00:28:22,960 --> 00:28:24,960 Speaker 4: I'm show in the next twenty years in Africa as 540 00:28:24,960 --> 00:28:27,600 Speaker 4: well as kind of the young population their rises, and 541 00:28:27,680 --> 00:28:31,840 Speaker 4: then ready an opportunity in convenience and branded packaging of 542 00:28:31,920 --> 00:28:36,840 Speaker 4: foods which at the moment are informal, unpackaged and increasingly 543 00:28:36,880 --> 00:28:39,880 Speaker 4: people in emerging markets a little shy about going there. 544 00:28:40,600 --> 00:28:44,400 Speaker 1: And I assume when you're talking about a rising affluence 545 00:28:44,480 --> 00:28:48,360 Speaker 1: in emerging some emerging markets, does your focus tend to 546 00:28:48,400 --> 00:28:50,960 Speaker 1: be more on food at home or is there a 547 00:28:51,080 --> 00:28:55,320 Speaker 1: restaurant segment there that is also going to increase in 548 00:28:55,760 --> 00:28:57,400 Speaker 1: demand in those economies. 549 00:28:58,440 --> 00:29:01,720 Speaker 4: We haven't seen a big up opportunity in the restaurant 550 00:29:01,760 --> 00:29:05,760 Speaker 4: sectors investors. It's very fragmented margins. It's a tough business 551 00:29:05,880 --> 00:29:08,600 Speaker 4: to be in. Of course, you've seen some venture capital 552 00:29:08,640 --> 00:29:11,400 Speaker 4: in ghost kitchens and so on, but we haven't seen 553 00:29:11,440 --> 00:29:14,959 Speaker 4: that identified as an investment opportunity. I should say, as 554 00:29:15,000 --> 00:29:18,680 Speaker 4: we look at the investment university at our company, at PGUM, 555 00:29:18,760 --> 00:29:21,280 Speaker 4: we only look at opportunities we would consider in one 556 00:29:21,320 --> 00:29:23,800 Speaker 4: of our portfolios or already investing it in one of 557 00:29:23,800 --> 00:29:27,680 Speaker 4: our portfolios. Maybe the bigger opportunity we see, which again 558 00:29:27,800 --> 00:29:31,720 Speaker 4: is I think underinvested in even by institutional investors, by 559 00:29:31,760 --> 00:29:34,760 Speaker 4: pension plans and so on, and Sertney, I think individual investors, 560 00:29:35,120 --> 00:29:36,680 Speaker 4: and we need to find better ways for them to 561 00:29:36,760 --> 00:29:41,320 Speaker 4: access it. But that's agricultural debt and equity farmland investing, 562 00:29:41,400 --> 00:29:43,400 Speaker 4: both in the equity side and debt side. And I 563 00:29:43,440 --> 00:29:45,600 Speaker 4: know and both of you have talked about that in 564 00:29:45,640 --> 00:29:48,480 Speaker 4: the past, but that is definitely an area which is 565 00:29:48,520 --> 00:29:51,680 Speaker 4: a good inflation heads which everybody's thinking about now. It's 566 00:29:51,720 --> 00:29:55,680 Speaker 4: pretty uncorrelated with stock markets and bond markets, particularly if 567 00:29:55,680 --> 00:29:57,680 Speaker 4: you're on the permanent end of the row crops rather 568 00:29:57,720 --> 00:30:00,840 Speaker 4: than the ones that are not. You can find some 569 00:30:00,920 --> 00:30:03,720 Speaker 4: parts of the world California as a good example, Mexico's 570 00:30:03,720 --> 00:30:06,320 Speaker 4: and other one parts of Australia are a third where 571 00:30:06,320 --> 00:30:10,120 Speaker 4: you can really find investment opportunities and also support sustainable 572 00:30:10,560 --> 00:30:13,360 Speaker 4: farmland techniques as well. And we still see that as 573 00:30:13,400 --> 00:30:16,560 Speaker 4: a pretty small percentage of people's allocations. I don't think 574 00:30:16,560 --> 00:30:19,320 Speaker 4: it's ever going to be ten percent, but everybody should 575 00:30:19,320 --> 00:30:21,600 Speaker 4: probably think about should there be one to three percent 576 00:30:21,680 --> 00:30:22,400 Speaker 4: in farmland. 577 00:30:38,040 --> 00:30:40,680 Speaker 2: You read my mind because I was interested in If 578 00:30:40,680 --> 00:30:43,800 Speaker 2: somebody calls you and says I'm interested in farmland as 579 00:30:43,800 --> 00:30:46,480 Speaker 2: an investment, what you would tell them more where you 580 00:30:46,520 --> 00:30:47,440 Speaker 2: would tell them to look. 581 00:30:48,320 --> 00:30:51,080 Speaker 4: So we have one of the big investors in farmland, 582 00:30:51,080 --> 00:30:53,880 Speaker 4: but not not even talking our own book, it's very 583 00:30:53,920 --> 00:30:57,640 Speaker 4: clear over thirty forty fifty years, through multiple market cycles 584 00:30:58,160 --> 00:31:02,800 Speaker 4: that that farmland has shown good inflation characteristics and be 585 00:31:02,960 --> 00:31:05,040 Speaker 4: What a lot of institutional investors are trying to do 586 00:31:05,160 --> 00:31:07,200 Speaker 4: is not just trying to earn that extra point of return. 587 00:31:07,640 --> 00:31:10,640 Speaker 4: They're trying to diversify their portfolio and create more stability 588 00:31:10,640 --> 00:31:13,480 Speaker 4: for their end beneficiaries, the people they need to pay out, 589 00:31:13,960 --> 00:31:16,800 Speaker 4: and farmland has worked really well as a way of 590 00:31:17,200 --> 00:31:20,640 Speaker 4: diversifying your holdings. So our key questions is do you 591 00:31:20,680 --> 00:31:22,840 Speaker 4: want to be on the death side, which is more 592 00:31:22,920 --> 00:31:25,760 Speaker 4: yield and it's not just the commodity returns which are 593 00:31:25,800 --> 00:31:28,960 Speaker 4: quite can be quite volatile, but actually just the farmland ownership, 594 00:31:29,200 --> 00:31:30,920 Speaker 4: or do you want to be on the equity side, 595 00:31:31,240 --> 00:31:35,120 Speaker 4: but both are pretty safe. We mainly invest in develop markets. 596 00:31:35,440 --> 00:31:38,680 Speaker 4: We don't take the risk of owning emerging markets farmland, 597 00:31:38,720 --> 00:31:41,560 Speaker 4: so we don't have investments, say in China and so on, 598 00:31:41,920 --> 00:31:45,800 Speaker 4: whether regulatory and ownership risks become much higher than say 599 00:31:45,840 --> 00:31:47,080 Speaker 4: the US or Australia. 600 00:31:47,160 --> 00:31:49,040 Speaker 1: I wanted to go back to that notion you were 601 00:31:49,040 --> 00:31:51,720 Speaker 1: talking about cold storage, and that to me makes a 602 00:31:51,760 --> 00:31:54,160 Speaker 1: lot of sense as an avenue of growth, especially in 603 00:31:54,680 --> 00:31:57,720 Speaker 1: emerging markets and whatnot, but as a real estate plate 604 00:31:57,880 --> 00:32:00,520 Speaker 1: just how do the particulars of that work or their 605 00:32:00,760 --> 00:32:03,600 Speaker 1: cold storage reates that that I'm unfamiliar with, or is 606 00:32:03,640 --> 00:32:07,560 Speaker 1: it is that you buy a warehouse and rent it 607 00:32:07,600 --> 00:32:10,600 Speaker 1: out to What are the sort of details of how 608 00:32:10,960 --> 00:32:12,160 Speaker 1: that works in as an investment? 609 00:32:12,960 --> 00:32:15,040 Speaker 4: So the way I investors invest in it is still 610 00:32:15,080 --> 00:32:17,520 Speaker 4: in a more diversified real estate investment. 611 00:32:17,640 --> 00:32:19,480 Speaker 3: I haven't checked on the on the. 612 00:32:19,280 --> 00:32:22,040 Speaker 4: Cold storage rates, but probably somebody should google that and 613 00:32:22,080 --> 00:32:24,840 Speaker 4: then reach for everything. 614 00:32:25,200 --> 00:32:27,880 Speaker 3: Yeah, if not, we can start it. 615 00:32:28,040 --> 00:32:31,000 Speaker 4: Might be it might be at another business opportunity spawned 616 00:32:31,000 --> 00:32:34,600 Speaker 4: by spawn spawned here. But within those portfolios absolutely their 617 00:32:34,640 --> 00:32:39,400 Speaker 4: buildings and warehouses that are designed with all the cooling 618 00:32:39,440 --> 00:32:44,160 Speaker 4: facilities and refrigeration that's needed for modern produce to be 619 00:32:44,200 --> 00:32:47,000 Speaker 4: at the optimal temperature to be in good condition when 620 00:32:47,000 --> 00:32:48,560 Speaker 4: it gets to the end houses. And that's a very 621 00:32:48,640 --> 00:32:52,800 Speaker 4: specialized kind of facility and we very much look to 622 00:32:52,840 --> 00:32:55,719 Speaker 4: those in terms of investment opportunities. There's a good parallel 623 00:32:55,800 --> 00:32:59,080 Speaker 4: with biotech right to actually house a biotech lab. There's 624 00:32:59,120 --> 00:33:01,720 Speaker 4: actually a big opportunity in real estate because you need 625 00:33:01,880 --> 00:33:05,400 Speaker 4: very specialized buildings to put all the machinery and equipment 626 00:33:05,520 --> 00:33:07,880 Speaker 4: and the temperatures you need for that as well. So 627 00:33:07,920 --> 00:33:10,080 Speaker 4: these kind of specialized places is where a lot of 628 00:33:10,080 --> 00:33:12,920 Speaker 4: the realistic opportunity is. I might put it in the 629 00:33:12,960 --> 00:33:16,560 Speaker 4: broader opportunity because online shopping is growing, right and maybe 630 00:33:16,600 --> 00:33:19,720 Speaker 4: pre COVID we all bought I don't know, stapless online, 631 00:33:19,800 --> 00:33:21,880 Speaker 4: But now more and more people were willing to buy 632 00:33:21,920 --> 00:33:25,880 Speaker 4: even their their their tomatoes and their apples and their 633 00:33:25,920 --> 00:33:29,400 Speaker 4: and their chicken online and the logistics required for that 634 00:33:29,480 --> 00:33:32,920 Speaker 4: and the distribution facilities in warehousing is massive. So that's 635 00:33:32,960 --> 00:33:36,360 Speaker 4: a bigger realistic opportunity as well. Linked to this food system. 636 00:33:36,280 --> 00:33:40,560 Speaker 1: All right time are fascinating stuff on the global food 637 00:33:40,600 --> 00:33:43,080 Speaker 1: supply chain. But before we let you go, I'd love 638 00:33:43,080 --> 00:33:47,520 Speaker 1: to just get your sense of the overall markets right now. 639 00:33:47,560 --> 00:33:51,120 Speaker 1: You know, we saw this tremendous rally in US equities, 640 00:33:51,200 --> 00:33:55,960 Speaker 1: especially that growth and tech side interest rates are high. 641 00:33:56,280 --> 00:33:59,720 Speaker 1: What's the opportunity set look like to you from sort 642 00:33:59,760 --> 00:34:02,320 Speaker 1: of a a macro level. Are you risk on still 643 00:34:02,360 --> 00:34:04,680 Speaker 1: after that first half? Are you a little more cautious? 644 00:34:04,720 --> 00:34:07,560 Speaker 1: How are you thinking about the opportunity set in the 645 00:34:07,560 --> 00:34:08,239 Speaker 1: market right now? 646 00:34:09,360 --> 00:34:10,319 Speaker 3: Over the short term. 647 00:34:10,360 --> 00:34:13,399 Speaker 4: We are definitely thinking the next six months is more 648 00:34:13,640 --> 00:34:16,600 Speaker 4: risk off than a risk on environment. We feel the 649 00:34:16,760 --> 00:34:21,520 Speaker 4: markets in generally, particularly equity markets, are probably undervaluing the 650 00:34:21,560 --> 00:34:24,520 Speaker 4: amount of risk to the global economy that exists between 651 00:34:24,560 --> 00:34:29,600 Speaker 4: geopolitical conflicts, between how does the Fed and other central 652 00:34:29,640 --> 00:34:32,560 Speaker 4: banks kind of manage this very fine line between inflation 653 00:34:32,680 --> 00:34:35,799 Speaker 4: and recession risk. So we and many of us sophisticated 654 00:34:35,880 --> 00:34:39,160 Speaker 4: investors are still in risk off mode. Having said that, 655 00:34:39,239 --> 00:34:41,960 Speaker 4: I think somewhere in the next eighteen months, and I 656 00:34:41,960 --> 00:34:44,600 Speaker 4: know that's a broad period, it will be one of 657 00:34:44,600 --> 00:34:47,960 Speaker 4: the best investment opportunities in our lives as markets correct, 658 00:34:47,960 --> 00:34:51,080 Speaker 4: But we don't think we are there. Second, I'd say 659 00:34:51,360 --> 00:34:54,440 Speaker 4: we remain very humble. We think this is a very different, 660 00:34:54,640 --> 00:34:59,240 Speaker 4: difficult macroeconomic environment to navigate, and we are quite scenario 661 00:34:59,360 --> 00:35:01,800 Speaker 4: based in I think we haven't put all our bets 662 00:35:01,840 --> 00:35:03,840 Speaker 4: on one scenario, but you've got to look at what 663 00:35:03,840 --> 00:35:06,120 Speaker 4: are the range of outcomes that can happen between a 664 00:35:06,239 --> 00:35:09,359 Speaker 4: soft landing and a deeper recession, And we planned our 665 00:35:09,360 --> 00:35:12,960 Speaker 4: portfolio to kind of manage across multiples of those different 666 00:35:13,280 --> 00:35:17,600 Speaker 4: settings at this point. And third, we think that returns 667 00:35:18,040 --> 00:35:21,680 Speaker 4: and rates don't come down as quickly as markets assume. 668 00:35:22,200 --> 00:35:25,360 Speaker 4: Once central banks set the rate at a certain level, 669 00:35:25,840 --> 00:35:29,800 Speaker 4: they wait their pors, their see before they move again. 670 00:35:30,320 --> 00:35:32,520 Speaker 4: And markets have sort of assumed that we're at the 671 00:35:32,520 --> 00:35:35,000 Speaker 4: top of the hill and we immediately marching down again. 672 00:35:35,360 --> 00:35:37,919 Speaker 4: And I think in reality we'll stay at a steady state, 673 00:35:37,960 --> 00:35:40,239 Speaker 4: whether it's twenty five or fifty basis points from where 674 00:35:40,239 --> 00:35:42,719 Speaker 4: we are now, who knows, but we're going to stay 675 00:35:42,760 --> 00:35:45,280 Speaker 4: at that level for a little longer, and the signals 676 00:35:45,280 --> 00:35:46,880 Speaker 4: for a recession will have to be deeper than they 677 00:35:46,880 --> 00:35:50,799 Speaker 4: are now before central banks act, and markets and investors 678 00:35:50,800 --> 00:35:54,200 Speaker 4: are under investing against that idea. 679 00:35:55,680 --> 00:36:00,120 Speaker 1: Well that's Timer Hyatt, he's the chief operating officer at PGM. 680 00:36:00,280 --> 00:36:02,680 Speaker 1: A pleasure to hear all your thoughts. He talks about 681 00:36:02,719 --> 00:36:06,560 Speaker 1: more than food, it turns out, Yeah, going on, I 682 00:36:06,640 --> 00:36:09,560 Speaker 1: like this, No, I love the food topic as we 683 00:36:09,600 --> 00:36:12,279 Speaker 1: do in farming. Really interesting, so wildon and I are 684 00:36:12,320 --> 00:36:15,000 Speaker 1: both secretly wished to run a farmer. 685 00:36:15,160 --> 00:36:18,800 Speaker 2: Yeah, farmers to be one day in New Jersey. 686 00:36:19,080 --> 00:36:21,640 Speaker 1: But can't let you go just yet. Timer. We do 687 00:36:21,719 --> 00:36:25,080 Speaker 1: have a tradition here the craziest things we saw in 688 00:36:25,120 --> 00:36:28,360 Speaker 1: markets this week? Have you seen anything crazy in markets recently? 689 00:36:29,320 --> 00:36:32,840 Speaker 4: My crazy story is maybe not about markets now, but 690 00:36:32,920 --> 00:36:35,719 Speaker 4: it's about what markets don't look at but ultimately will 691 00:36:35,800 --> 00:36:38,799 Speaker 4: and should. And we had a colleague who just took 692 00:36:38,840 --> 00:36:42,560 Speaker 4: a flight from Singapore to London and British Airways this 693 00:36:42,640 --> 00:36:46,080 Speaker 4: was in the headlines and the British newspapers hit massive turbulence. 694 00:36:46,120 --> 00:36:49,800 Speaker 4: Five people on the plane were injured. And the University 695 00:36:49,840 --> 00:36:52,480 Speaker 4: of Reading in England has done research that between nineteen 696 00:36:52,560 --> 00:36:55,960 Speaker 4: seventy and twenty two, twenty twenty two, there's been a 697 00:36:56,000 --> 00:37:00,880 Speaker 4: fifty five percent increase in severe turbulence on Atlantic flights 698 00:37:01,920 --> 00:37:05,440 Speaker 4: and it's because the jet streams, because of climate change, 699 00:37:05,480 --> 00:37:09,520 Speaker 4: are fifteen percent more shear happens in the wind patterns, wow, 700 00:37:10,040 --> 00:37:14,200 Speaker 4: and that raises the cost of plane maintenance. It actually 701 00:37:14,239 --> 00:37:16,840 Speaker 4: means in the future because they expect a three to 702 00:37:16,920 --> 00:37:19,319 Speaker 4: six times fold increase over the next thirty years in 703 00:37:19,360 --> 00:37:22,200 Speaker 4: the amount of turbulence that pilots will have to take 704 00:37:22,239 --> 00:37:24,880 Speaker 4: new routes that might be more expensive. And to me, 705 00:37:24,920 --> 00:37:27,279 Speaker 4: it's just a classic example of the fact that much 706 00:37:27,320 --> 00:37:30,960 Speaker 4: as I love markets, and much as markets capture many things, 707 00:37:31,440 --> 00:37:34,959 Speaker 4: there are externalities, things one step ahead of markets, such 708 00:37:34,960 --> 00:37:39,600 Speaker 4: as these weird nonlinear tail wrists that happen from climate 709 00:37:39,680 --> 00:37:43,480 Speaker 4: change that ultimately will come into market pricing, and savvy 710 00:37:43,480 --> 00:37:46,440 Speaker 4: investors are one to sort of figure out what's going to. Yeah, 711 00:37:46,680 --> 00:37:49,800 Speaker 4: and turbulence and all its second order impacts, and probably 712 00:37:49,880 --> 00:37:51,960 Speaker 4: none of us will be able to have a class 713 00:37:51,960 --> 00:37:54,240 Speaker 4: of champagne if we ever get into business class without 714 00:37:54,280 --> 00:37:56,359 Speaker 4: bouncing up and down is one of them. 715 00:37:56,520 --> 00:38:00,719 Speaker 1: That's wild, Yeah, because the Gulf streams actually got stronger, 716 00:38:00,880 --> 00:38:03,400 Speaker 1: just more turbulent. Or is it it's shifting too right, 717 00:38:03,480 --> 00:38:06,000 Speaker 1: isn't it shifting across the Atlantic a little bit? Right? 718 00:38:06,040 --> 00:38:09,120 Speaker 4: The temperature difference between the poles and the continents has 719 00:38:09,160 --> 00:38:12,040 Speaker 4: gone down as the polls heat up, and theref for 720 00:38:12,120 --> 00:38:14,480 Speaker 4: the jet streams that were very focused and targeted and 721 00:38:14,520 --> 00:38:17,520 Speaker 4: you knew exactly how they went have gotten more erratic. 722 00:38:17,400 --> 00:38:20,160 Speaker 1: Less predictable, and you don't know wow, And so you 723 00:38:20,960 --> 00:38:23,440 Speaker 1: would typically plan your route to sort of minimize it. 724 00:38:23,520 --> 00:38:25,319 Speaker 1: And I guess now you can't do that. 725 00:38:25,520 --> 00:38:26,319 Speaker 3: Now you can't. 726 00:38:26,320 --> 00:38:28,399 Speaker 4: This is known as a cleaner turbulence, where you don't 727 00:38:28,440 --> 00:38:30,920 Speaker 4: expect it when it hits, it always happens, but it's 728 00:38:30,960 --> 00:38:32,560 Speaker 4: becoming much worse as a problem. 729 00:38:32,719 --> 00:38:34,040 Speaker 2: Wow, I'm so scared of this. 730 00:38:35,760 --> 00:38:38,919 Speaker 1: It is scary, that is. But you're right though, something 731 00:38:38,920 --> 00:38:41,080 Speaker 1: to get ahead of as a as an investor when 732 00:38:41,080 --> 00:38:43,759 Speaker 1: you think about this stuff all right. Mine has to 733 00:38:43,760 --> 00:38:49,000 Speaker 1: do with pricing in the influencer economy. It's a story 734 00:38:49,200 --> 00:38:51,280 Speaker 1: courtesy of the New York Post. Have you ever heard 735 00:38:52,160 --> 00:38:57,920 Speaker 1: of someone named Olivia Dunn Soeldna, Never me neither. She 736 00:38:58,080 --> 00:39:01,719 Speaker 1: is an influencer. She is a gymnast at LSU Louisiana 737 00:39:01,719 --> 00:39:05,520 Speaker 1: State University. If you follow college athletics, there's this thing 738 00:39:05,560 --> 00:39:08,279 Speaker 1: called the nil. Now, the evaluation on hers is the 739 00:39:08,360 --> 00:39:12,840 Speaker 1: second highest among all college athletes, second only to Lebron 740 00:39:12,960 --> 00:39:16,920 Speaker 1: jameson Brownie James. So here's where it gets interesting. She 741 00:39:17,000 --> 00:39:19,600 Speaker 1: was on This is the story New York Post wrote 742 00:39:19,640 --> 00:39:23,640 Speaker 1: up about a podcast appearance she did, the Full Send podcast. 743 00:39:23,840 --> 00:39:29,920 Speaker 1: She revealed the highest price she's ever received, the highest 744 00:39:29,920 --> 00:39:33,720 Speaker 1: payday for a single post. Now, mind you, she has 745 00:39:34,200 --> 00:39:38,759 Speaker 1: on Instagram, four point two million followers on Instagram and 746 00:39:39,040 --> 00:39:41,640 Speaker 1: seven point six on TikTok. They didn't say which one 747 00:39:41,640 --> 00:39:43,279 Speaker 1: it was on. Maybe it was on both, I don't know. 748 00:39:43,400 --> 00:39:47,840 Speaker 1: But the highest fee she's ever received for a single 749 00:39:47,920 --> 00:39:51,440 Speaker 1: post from a college student who just happens to be 750 00:39:51,480 --> 00:39:56,120 Speaker 1: on the LSU gymnastics team one hundred and nine one 751 00:39:56,200 --> 00:39:59,040 Speaker 1: hundred and ninety six thousand. That's your guest. Yeah, Timer, 752 00:39:59,120 --> 00:40:05,560 Speaker 1: what do you think highest price for a single post 753 00:40:06,640 --> 00:40:11,920 Speaker 1: from a gymnast influencer three hundred and thirty thou closer? 754 00:40:12,040 --> 00:40:15,120 Speaker 1: Five hundred grand? Wow, five hundred grand for a single post. 755 00:40:15,520 --> 00:40:16,879 Speaker 2: We should become influencers. 756 00:40:16,960 --> 00:40:20,440 Speaker 1: Yeah, and I'm very I can't influence anyone. 757 00:40:20,719 --> 00:40:23,360 Speaker 2: Influencers fake influence. 758 00:40:23,719 --> 00:40:26,319 Speaker 4: I post my food pictures on Instagram and I have 759 00:40:26,360 --> 00:40:27,360 Speaker 4: sixty nine followers. 760 00:40:27,400 --> 00:40:30,960 Speaker 1: I'm very. What's the highest you've ever received? 761 00:40:31,640 --> 00:40:32,759 Speaker 3: Twenty seven likes. 762 00:40:34,520 --> 00:40:38,120 Speaker 1: That's a good ratio out of sixty seven followers. Yeah, 763 00:40:38,320 --> 00:40:40,240 Speaker 1: so you're a foody? What cook at home yourself? 764 00:40:41,160 --> 00:40:42,920 Speaker 4: I cook at home. We spend half the time in 765 00:40:42,960 --> 00:40:44,960 Speaker 4: the Hudson Valley. I have a grill there and then 766 00:40:45,280 --> 00:40:48,319 Speaker 4: in a tiny city apartment. Kind of less grilling because 767 00:40:48,360 --> 00:40:51,080 Speaker 4: of Gonda rules. But yeah, I cook a bunch. What's 768 00:40:51,120 --> 00:40:57,160 Speaker 4: your best dish? My best dish is probably a braised 769 00:40:57,800 --> 00:41:03,480 Speaker 4: leg of lamb, tomatoes and onions and shallotts and all that. 770 00:41:05,080 --> 00:41:05,760 Speaker 1: I'm swooning. 771 00:41:06,360 --> 00:41:09,359 Speaker 3: It melts in your mouth. It's spoonable. It's very very good. 772 00:41:09,480 --> 00:41:12,919 Speaker 1: It's guilty of Aldana. If they ever make lab grown lamb, 773 00:41:12,920 --> 00:41:14,600 Speaker 1: you've got to try it, as guilty as I feel 774 00:41:14,640 --> 00:41:18,239 Speaker 1: freeing them. It's so good. Wow, I need to go 775 00:41:18,320 --> 00:41:21,480 Speaker 1: out immediately and eat something right now. This was a 776 00:41:21,600 --> 00:41:25,880 Speaker 1: very hunger inducing episode of What Goes Up. But Timer Hyatt, 777 00:41:25,960 --> 00:41:29,080 Speaker 1: chief operating Officer of Pechim, really a pleasure to catch 778 00:41:29,160 --> 00:41:31,960 Speaker 1: up with you and hear about this report that you 779 00:41:31,960 --> 00:41:34,920 Speaker 1: guys have out on Food for Thought. I believe it's 780 00:41:34,920 --> 00:41:37,600 Speaker 1: called the name of it aftely named about the global 781 00:41:38,440 --> 00:41:41,480 Speaker 1: supply chain and food, how it's changing and what the 782 00:41:41,480 --> 00:41:44,000 Speaker 1: opportunities are. Really fascinating stuff. Thank you for your time. 783 00:41:44,160 --> 00:41:46,080 Speaker 3: It's a pleasure to be a great, great conversation. 784 00:41:46,239 --> 00:41:57,320 Speaker 5: Thank you, What Goes Up. We'll be back next week. 785 00:41:57,719 --> 00:41:59,920 Speaker 5: Until then, you can find us in the Bloomberg Terminal 786 00:42:00,200 --> 00:42:04,399 Speaker 5: website and app or wherever you get your podcasts. We'd 787 00:42:04,440 --> 00:42:06,040 Speaker 5: love it if you took the time to rate and 788 00:42:06,120 --> 00:42:09,120 Speaker 5: review the show so more listeners can find us. You 789 00:42:09,160 --> 00:42:13,200 Speaker 5: can find us on Twitter, follow me at Wildona Hirich. 790 00:42:13,680 --> 00:42:17,400 Speaker 5: Mike Reagan is at Reaganonymous. You can also follow Boomer 791 00:42:17,520 --> 00:42:22,000 Speaker 5: Podcasts at podcasts. What Goes Up is produced by Stacy 792 00:42:22,040 --> 00:42:24,880 Speaker 5: Wong and our head of podcasts is Sage Bauman. 793 00:42:25,360 --> 00:42:30,200 Speaker 2: Thanks for listening. We'll see you next week.