WEBVTT - Davos Special: Rubenstein Says Nationalism Affects Big Banks 0:00:00.080 --> 0:00:02.920 Brought you by Bank of America, Mary Lynch. Investing in 0:00:03.000 --> 0:00:07.840 local communities, economies and a sustainable future. That's the power 0:00:08.080 --> 0:00:12.360 of global connections. Mary Lynch, Pierce Fenner and Smith Incorporated 0:00:12.760 --> 0:00:27.400 Member s I p C. Welcome to the Bloomberg Surveillance Podcast. 0:00:27.800 --> 0:00:31.520 I'm Tom Keene with David Gura. Daily we bring you 0:00:31.560 --> 0:00:36.600 insight from the best in economics, finance, investment, and international relations. 0:00:37.000 --> 0:00:41.600 Find Bloomberg Surveillance on iTunes, SoundCloud, Bloomberg dot Com, and 0:00:41.680 --> 0:00:50.080 of course on the Bloomberg. Tom Keen in Davos, Switzerland 0:00:50.120 --> 0:00:52.240 for the World Economic Forum's annual meeting. He just sat 0:00:52.280 --> 0:00:55.160 down with Jacob Frankel, chairman of JP Morgan Chase International, 0:00:55.240 --> 0:00:57.120 former Governor of the Bank of Israel, and let's take 0:00:57.120 --> 0:01:00.120 a listen to some of their conversation. How are we doing? 0:01:00.160 --> 0:01:04.240 Are we out of financial crisis? Yet? We are clearly 0:01:04.800 --> 0:01:09.319 very close to it, But I would never declare victory prematurely. 0:01:09.720 --> 0:01:13.240 The important point is that at the beginning of the crisis, 0:01:13.520 --> 0:01:18.360 the mindset of policy makers was how to extinguish a file. 0:01:18.760 --> 0:01:22.680 This is a mindset that has a short term perspective. 0:01:23.120 --> 0:01:25.280 In front of you, you say, I have a file. 0:01:25.600 --> 0:01:27.600 I have to put a lot of water on the file, 0:01:27.880 --> 0:01:30.840 and if the carpets get spoiled, so beat. I need 0:01:30.880 --> 0:01:34.160 to deal with the file. But over time, as the 0:01:34.280 --> 0:01:37.959 file is being put away, we need to worry about 0:01:37.959 --> 0:01:41.320 the resumption of growth. We need to have a medium 0:01:41.440 --> 0:01:44.520 term approach, a long term approach, the only approach that 0:01:44.600 --> 0:01:49.480 matters for investment and growth. And that's why the challenges 0:01:49.600 --> 0:01:53.320 now how to move towards an economy and policy making 0:01:53.760 --> 0:01:56.760 that is looking into the long run, that is having 0:01:56.840 --> 0:02:00.200 a flexibility of the economy, that has structural policies, that 0:02:00.360 --> 0:02:04.200 understands that in order to grow, you need to be 0:02:04.320 --> 0:02:08.680 part of the global system, that understands that trade is 0:02:08.960 --> 0:02:14.480 a privilege that everyone should be gaining from, etcetera. But 0:02:14.560 --> 0:02:18.160 we have this year theme, my theme populism. Trump's dovo 0:02:18.280 --> 0:02:21.720 certainly not original, many other people have picked up on this. 0:02:22.320 --> 0:02:27.280 How do policy makers, through the prism of their economists 0:02:27.320 --> 0:02:31.800 and advisors deal with populism? It's just simply a search 0:02:31.880 --> 0:02:34.400 for economic growth, isn't it? Where it is sells for 0:02:34.520 --> 0:02:38.040 economic growth. But I would add two adjectives search for 0:02:38.400 --> 0:02:43.280 sustainable economic growth, namely medium term perspective and search for 0:02:43.800 --> 0:02:48.239 and inclusive economic growth, namely that the benefits from growth 0:02:48.280 --> 0:02:51.639 are shelled. If we miss on any of these two 0:02:51.960 --> 0:02:57.000 inclusiveness and medium term approach sustainability, then we will really 0:02:57.320 --> 0:03:01.760 miss the boat. And it is the responsibility of policy makers, 0:03:01.760 --> 0:03:06.480 of the media, of educators alike to shift the narrative 0:03:06.560 --> 0:03:12.239 and debate away from the protectionism and populism towards more 0:03:12.280 --> 0:03:14.960 concrete issue. Let me give you an example. When you 0:03:15.000 --> 0:03:18.040 talk to people who are saying I want to have protection, 0:03:18.160 --> 0:03:22.400 is against trade, I don't want the globalization, etcetera, ask them, 0:03:22.680 --> 0:03:26.880 are you really against the benefits from trade? They will 0:03:26.919 --> 0:03:30.040 tell you owners, I want the benefits. So what are 0:03:30.040 --> 0:03:34.360 you against? I am against some of the negative consequences 0:03:34.400 --> 0:03:40.760 that trade unchecked may entail. Maybe not everyone will benefit. Okay, 0:03:40.920 --> 0:03:43.560 then shift the debate to this, how do we make 0:03:43.600 --> 0:03:46.400 sure that society shows and how do we do that? 0:03:46.880 --> 0:03:50.080 How do we affect a policy that meets the president 0:03:50.160 --> 0:03:53.800 elects demands and the people that supported him, and it 0:03:54.040 --> 0:03:58.680 gives us a policy for those left bend. Absolutely, it 0:03:58.800 --> 0:04:03.480 has to be at least two dimensions. Number One, you 0:04:03.560 --> 0:04:08.800 need to ease the transition period. This means trade adjustment assistance. 0:04:09.120 --> 0:04:14.800 This means job retraining, This means making people more capable 0:04:15.120 --> 0:04:23.000 to accommodate the changes. Not good enough. The very fact 0:04:23.360 --> 0:04:26.720 that now, years after an after, there are those who 0:04:26.800 --> 0:04:30.840 say that NAFTA was a bad thing is a testimony 0:04:31.080 --> 0:04:33.640 to the debate. So instead of saying afterwards a good 0:04:33.640 --> 0:04:36.159 thing of a bad thing, which goes to the political debate, 0:04:36.320 --> 0:04:39.359 we really need to say, how do we ensure inclusiveness? 0:04:39.880 --> 0:04:41.920 Tom King, they're talking with Jacob Frankl, the chairman of 0:04:42.000 --> 0:04:44.359 Japing Morgan Chase International, chairman of the Ward trustee in 0:04:44.360 --> 0:04:46.279 the Group of thirty as well and former governor of 0:04:46.320 --> 0:04:48.840 the Bank of Israel in Davos, Switzerland at Annual Meaning 0:04:48.880 --> 0:05:03.560 of the World Economic Form. Let's do this, David, Let's 0:05:03.680 --> 0:05:08.520 uh move forward to the quiet strength of Davos, which 0:05:08.560 --> 0:05:13.440 is year after year after year, persistent research. No one 0:05:13.480 --> 0:05:16.640 has done that better than Richard Edelman. Of course, this 0:05:16.760 --> 0:05:20.320 company is dealing in public relations, usually for corporations who 0:05:21.000 --> 0:05:24.320 blown up their relations, and they assistance in moving forward. 0:05:25.120 --> 0:05:28.440 Richard Edelman very good at that. But for me, the 0:05:28.640 --> 0:05:32.560 Edelman Trust Barometer is an important document. And no there's 0:05:32.600 --> 0:05:36.440 no year which is like this year for the distrust 0:05:36.600 --> 0:05:39.440 that's out there, Richard Edlman, wonderful to have you here 0:05:39.480 --> 0:05:41.960 your annual visit. Where As she said me, you know, 0:05:42.040 --> 0:05:45.440 two weeks ago and said, Tom, it's an extraordinary lack 0:05:45.480 --> 0:05:47.640 of trust out there. What is the telling thing in 0:05:47.680 --> 0:05:51.599 the sixty six pages of your analysis. Well, trust is 0:05:51.640 --> 0:05:56.080 imploded this year, Tom, in the institutions, but particularly in media. 0:05:56.560 --> 0:05:59.360 And it's actually seen that the media has become part 0:05:59.400 --> 0:06:02.200 of the elite um. There's a world of self reference, 0:06:02.480 --> 0:06:05.440 that the media is an is an echo chamber in fact, 0:06:05.480 --> 0:06:08.599 for whether you're right or left, and that you don't 0:06:08.640 --> 0:06:10.719 really want to read or hear anything that you don't 0:06:10.760 --> 0:06:15.720 agree with. Is the distrust out there contained within the 0:06:15.800 --> 0:06:20.600 United States, Or when we talk about global populism, is 0:06:20.839 --> 0:06:24.320 there a contagion effect? Or is each nation discreet in 0:06:24.440 --> 0:06:29.440 their barometer? So you know, this year is stunning in 0:06:29.640 --> 0:06:33.279 the number of countries that have moved beyond just loss 0:06:33.279 --> 0:06:36.599 of trust in their institutions to a loss of faith 0:06:36.640 --> 0:06:40.400 in the system. More than half the countries have have 0:06:41.000 --> 0:06:45.320 lack of confidence in fairness, in the extent to which 0:06:45.600 --> 0:06:47.880 they can make a better life for their families in 0:06:47.920 --> 0:06:51.960 the future, and in their leaders. They want change If 0:06:51.960 --> 0:06:54.520 you were to show the Edelman Trust Barometer to the 0:06:54.560 --> 0:06:57.760 President elect, what would you point out to Donald Trump? 0:06:58.480 --> 0:07:02.960 I would say that in a way, he reflects the mood, 0:07:03.080 --> 0:07:08.760 which is um deep socio and economic fears that people 0:07:08.800 --> 0:07:12.720 are looking behind themselves about to being replaced by robots, 0:07:12.760 --> 0:07:16.360 about jobs being outsourced, and that they want to have 0:07:16.680 --> 0:07:20.400 a direct and honest conversation with their employer about their 0:07:20.400 --> 0:07:23.280 economic future. Are they going to be better off in 0:07:23.320 --> 0:07:27.280 the future? You know? I look, Richard Edelman, the granularity 0:07:27.320 --> 0:07:29.320 of your report and the charm of it is. It's 0:07:29.400 --> 0:07:31.240 year after year. I remember a couple of years ago. 0:07:31.680 --> 0:07:34.960 I think even CEOs worsen politicians, which is hard to 0:07:35.440 --> 0:07:39.360 fathom within the expertology that's your review. How does CEO's 0:07:39.400 --> 0:07:42.600 lineup this year? The Trust and CEOs fell apart time 0:07:42.600 --> 0:07:45.400 We're back to two thousand nine, and I think it's 0:07:45.400 --> 0:07:49.440 a matter of compensation and also just disappointment in this 0:07:49.640 --> 0:07:53.160 narrow focus on shareholder value as opposed to fix the 0:07:53.200 --> 0:07:55.840 problems of society and tell me the truth about my job. 0:07:56.080 --> 0:07:58.200 Let me bring in my colleague in New York, David Gura, 0:07:58.400 --> 0:08:01.440 with Richard Edelman. Please, yeah, try you don't mince words. 0:08:01.440 --> 0:08:03.280 So you say there's a complete loss of faith in 0:08:03.280 --> 0:08:06.120 the system and and and that's a bold, sweeping statement. 0:08:06.240 --> 0:08:08.000 How did we get here? And how reversible is this 0:08:08.080 --> 0:08:10.680 do you think? I think it's a long, slow rebuild. 0:08:11.080 --> 0:08:14.600 I think trust is lost easily UM and its confidence 0:08:14.680 --> 0:08:16.960 is hard to bring back. And it's going to be 0:08:17.040 --> 0:08:21.160 each company, one at a time showing that in fact 0:08:21.240 --> 0:08:24.360 it does give good jobs, that it does reinvest, and 0:08:24.360 --> 0:08:28.000 that it does actually make communities better. And I also 0:08:28.080 --> 0:08:31.600 think that UM trust is going to be done by employees. 0:08:31.840 --> 0:08:35.520 That you've got to tell the employees because the new 0:08:35.600 --> 0:08:39.360 crazy is that it's a person like you, much much 0:08:39.400 --> 0:08:43.840 more credible than the CEO or of the government official 0:08:43.960 --> 0:08:46.880 twice as credible. Help us with with how this is 0:08:46.880 --> 0:08:50.280 setting the backdrop for conversations at Davos. Of course they're 0:08:50.720 --> 0:08:52.800 ahead of the event. There are always articles about what's 0:08:52.800 --> 0:08:55.520 going to be discussed, how relevant the World Economic Forum 0:08:55.559 --> 0:08:58.240 meeting is going to be, how much are people They're 0:08:58.240 --> 0:09:01.440 talking about credibility and ways to sort of bridge this gap. 0:09:02.520 --> 0:09:05.360 They understand that business is the last retaining wall in 0:09:05.559 --> 0:09:08.600 a tsunami, that the first was the Great Recession. Then 0:09:08.679 --> 0:09:12.520 you had globalization. Now you have automation, so business in 0:09:12.559 --> 0:09:16.040 a way for that uncommitted group, half the people have 0:09:16.080 --> 0:09:17.959 lost faith in the system, about a third or sort 0:09:18.000 --> 0:09:22.160 of uncommitted. In fifteen half confidence. That uncommitted group thinks 0:09:22.200 --> 0:09:25.960 that business is actually the most credible force. So now 0:09:26.080 --> 0:09:27.959 is the time for ceo s to stand up. Don't 0:09:28.000 --> 0:09:30.600 do what you usually do, which is duck and wait. UM, 0:09:30.640 --> 0:09:33.640 you've got to actually lead now and show that businesses 0:09:33.880 --> 0:09:36.319 is good. Well, you're you're. What you're so good at 0:09:36.600 --> 0:09:40.800 is the triage of the moment for our large companies. 0:09:41.120 --> 0:09:45.079 When you say to CEOs you've got to re establish 0:09:45.320 --> 0:09:48.800 a communication with a public, what does that actually entel? 0:09:49.360 --> 0:09:54.800 It means tom actually going to the employees first, UM 0:09:54.920 --> 0:09:59.079 then also having a channel that allows customers and UM 0:09:59.240 --> 0:10:03.240 and consumers to speak directly to the company. So for instance, 0:10:03.320 --> 0:10:06.439 United Airlines has a thing called Airtime where people can 0:10:06.480 --> 0:10:11.679 complain about service or UM employees can complain about working conditions, 0:10:11.920 --> 0:10:14.200 and all of this has made public. The level of 0:10:14.240 --> 0:10:18.400 transparency and the response over time is something that's learned 0:10:18.400 --> 0:10:21.680 from the sharing economy, from Uber Airbnb. That's a huge 0:10:21.760 --> 0:10:25.640 positive and it's been really critical to United's recovery of 0:10:25.679 --> 0:10:29.319 trust Richard Elemen, do people hunger for good dialogue? Do 0:10:29.600 --> 0:10:32.240 they recognize there's a deficit here? Do they want something better? 0:10:32.400 --> 0:10:35.800 Or have they gotten beyond that? Have they just given up? No? 0:10:35.960 --> 0:10:39.920 I think that the business leaders here definitely have processed 0:10:40.080 --> 0:10:44.319 UM that this populist movement is really scary for business, 0:10:44.320 --> 0:10:50.079 that anti globalization and anti innovation, that people are nervous 0:10:50.120 --> 0:10:53.520 in fact about new services, new products because it might 0:10:53.559 --> 0:10:56.240 mean that they don't have good jobs or jobs at all. 0:10:56.559 --> 0:10:59.880 So they want leadership and and the business leaders are 0:11:00.000 --> 0:11:04.800 now talking about it. I look, and again, folks, I go, 0:11:04.960 --> 0:11:06.840 I really urge you to go to the website of 0:11:06.960 --> 0:11:11.040 Edelman and look at the Edelman Trust Barometer. Over to 0:11:11.120 --> 0:11:15.520 our politicians, I can't fathom your account with the Trump 0:11:15.600 --> 0:11:20.160 administration how Edelman helps the Trump administration forward. Do you 0:11:20.320 --> 0:11:24.440 have a recommendation to our presidential tweeter? Do you what 0:11:24.520 --> 0:11:28.680 would be the Edelman Council to our newly minted president 0:11:28.760 --> 0:11:32.960 this Friday. I think that President Trump has to establish 0:11:33.080 --> 0:11:36.280 a game plan and then show progress for it. UM 0:11:36.360 --> 0:11:40.760 that he can't as a candidate UM just tweet his 0:11:40.840 --> 0:11:44.240 way to UM satisfaction that people are gonna be holding 0:11:44.320 --> 0:11:46.720 him to account, and it's not going to be just 0:11:46.760 --> 0:11:50.520 getting forward to relocate its jobs back to Ohio. It 0:11:50.600 --> 0:11:56.920 has to be a real plan of infrastructure and um 0:11:57.040 --> 0:12:01.720 education and economic development and decent means by which to 0:12:01.760 --> 0:12:04.120 renegotiate an AFTA or with the child. Set you up 0:12:04.120 --> 0:12:06.240 because I knew what the answer would be. Now let 0:12:06.240 --> 0:12:08.280 me let me get to what matters here, Richards, and 0:12:08.360 --> 0:12:11.120 will come back. The core idea then is you have 0:12:11.160 --> 0:12:13.319 to affect the policy. Can you do that with a 0:12:13.440 --> 0:12:18.160 distrust that's seen within the barometer the Edeleman Trust Barometer. Look, 0:12:18.200 --> 0:12:21.320 government is the least trusted institution in our study, and 0:12:21.640 --> 0:12:24.800 it has to actually be done between business and government, 0:12:25.120 --> 0:12:28.840 and it has to be seen as something that has 0:12:28.880 --> 0:12:32.040 been um done by listening to the people. We have 0:12:32.120 --> 0:12:34.520 to move from telling the people what's good for them 0:12:34.760 --> 0:12:37.840 to doing things with the people and let them judge 0:12:38.160 --> 0:12:41.760 a result. Richard Edelman with us with the accept I've 0:12:41.760 --> 0:12:44.520 never I say this every year, but now I really 0:12:44.720 --> 0:12:48.480 mean the idea of the Edelman Trust Barometer. I'll put 0:12:48.520 --> 0:12:51.320 that out on social and as I have uh the 0:12:51.440 --> 0:12:55.520 last few days, uh, and we'll go from there. David 0:12:55.600 --> 0:12:59.719 just An extraordinary document and a pleasure to read every 0:12:59.800 --> 0:13:03.040 year when it has launched the first day of Davos, 0:13:11.200 --> 0:13:14.720 brought you by Bank of America Mary Lynch, dedicated to 0:13:14.800 --> 0:13:18.679 bringing our clients insights and solutions to meet the challenges 0:13:18.840 --> 0:13:22.560 of a transforming world. That's the power of global connections. 0:13:22.960 --> 0:13:27.880 Mary Lynch, Pierce Federin Smith Incorporated Member s I p C. 0:13:30.920 --> 0:13:33.920 A most wonderful panel this morning talking about the future 0:13:33.920 --> 0:13:40.360 of finance and giving terrific perspective on the potential transactions 0:13:40.360 --> 0:13:44.400 and combinations, and also on uh the Nation of America. 0:13:44.480 --> 0:13:48.080 David Rubinstein the Carlisle Group, purely one of our great philanthropists. 0:13:48.240 --> 0:13:51.200 I think the most wonderful thing you do is the 0:13:51.280 --> 0:13:56.400 Redond Ford's Theater across the street from Ford's Theater. You 0:13:56.400 --> 0:14:01.160 guys left extent the tragic room where the sixteenth President died, 0:14:01.200 --> 0:14:04.200 but you placed a museum right next to it without 0:14:04.280 --> 0:14:07.960 destroying the feel of it. Yes, Um, I was a contributor, 0:14:08.000 --> 0:14:11.480 but I was not the principal person behind it. I 0:14:11.520 --> 0:14:13.679 was on the board of it for a while. And interestingly, 0:14:13.679 --> 0:14:15.800 the person who was the chairman of the capital campaign 0:14:15.800 --> 0:14:18.319 that raised the money was a man named Rex Tillerson. 0:14:18.600 --> 0:14:21.800 I don't know what's happened to him. I don't, but 0:14:22.440 --> 0:14:24.920 I think he'll He'll do okay. How will he do okay? 0:14:24.960 --> 0:14:27.560 A secretary of state? He has a different president than 0:14:27.600 --> 0:14:31.120 the previous president. Well, Rex is a very smart person 0:14:31.280 --> 0:14:34.200 and he's got a wealth of experience in dealing with 0:14:34.640 --> 0:14:37.600 leaders around the world. So I think he will be 0:14:37.720 --> 0:14:40.280 assuming he's confirmed, as I believe he will be. I 0:14:40.280 --> 0:14:42.360 think he'll be a very strong secretary of State. Remember 0:14:42.400 --> 0:14:45.240 he was recommended by one of my former partners, Jim Baker, 0:14:45.520 --> 0:14:47.760 and Jim Baker has pretty good judgment about these things. 0:14:48.400 --> 0:14:51.360 If I look at the so called Trump reflation and 0:14:51.400 --> 0:14:54.440 the idea of a boost and optimism, does that mean 0:14:54.440 --> 0:14:57.160 a boost and internal rates a return for those that 0:14:57.760 --> 0:15:01.960 invest privately, whether it's private equ venture capital, or good 0:15:01.960 --> 0:15:05.720 old all American mergers and acquisitions. I hope always springs eternal, 0:15:05.880 --> 0:15:09.840 of course, but there's no doubt that if you have inflation, 0:15:10.160 --> 0:15:13.360 inflation which we haven't had much of, that will probably 0:15:13.440 --> 0:15:16.920 produce higher rates of return. Whether they're higher in real 0:15:17.040 --> 0:15:20.400 terms or not, obviously uh to be determined. But I 0:15:20.400 --> 0:15:23.920 think when you have higher growth rates generally produce greater 0:15:24.000 --> 0:15:26.960 economic activity and that generally produces higher rates of return. 0:15:27.280 --> 0:15:29.760 So hopefully if this all can come about, it's not 0:15:29.840 --> 0:15:32.840 easy to do. Remember, we have a twenty trillion dollar 0:15:32.880 --> 0:15:36.720 economy and there's no history of twenty trillion dollar economies 0:15:36.720 --> 0:15:39.200 growing at five percent a year. So if we can 0:15:39.240 --> 0:15:41.520 get it slightly better than where it is, it's it's good. 0:15:41.640 --> 0:15:43.680 But a twenty trillion dollar economy is harder to move 0:15:43.680 --> 0:15:46.560 than a ten trillion dollar economy. Dave Rubinstein, there were 0:15:46.560 --> 0:15:48.360 two big speeches this morning. I don't need to tell 0:15:48.400 --> 0:15:50.720 you that, but the UK Prime Minister to reason they spoke, 0:15:50.760 --> 0:15:53.360 as well as the Chinese president jumping there in Davos. 0:15:53.720 --> 0:15:56.320 When you when you think about the global economy, which 0:15:56.320 --> 0:15:58.440 of those two was was most important? What were you 0:15:58.520 --> 0:16:02.240 listening for today? They're both important figures, of course, Uh 0:16:02.400 --> 0:16:04.840 president of China. A president of China had never come 0:16:04.880 --> 0:16:08.200 to Davas before, and President She therefore got a great 0:16:08.560 --> 0:16:11.080 deal of attention for coming. And what he was really 0:16:11.080 --> 0:16:14.400 saying is something that would not have been UH expected 0:16:14.400 --> 0:16:16.880 of a Chinese leader to say ten or twenty years ago, 0:16:16.920 --> 0:16:19.760 which is that globalization is very important and that China 0:16:19.800 --> 0:16:22.280 thinks that the world order should be respected in some 0:16:22.360 --> 0:16:25.560 respects UM. I think that Theresa May was saying that 0:16:25.920 --> 0:16:28.320 Brexit is going to occur at some point and that 0:16:28.400 --> 0:16:31.840 she's prepared to implement that. UM. Time will tell whether 0:16:32.000 --> 0:16:34.120 how how easy it will be to do that. It's 0:16:34.160 --> 0:16:37.120 a complicated negotiation, as we know, and and the courts 0:16:37.160 --> 0:16:39.440 have ruled in England that the Parliament has to vote 0:16:39.480 --> 0:16:41.560 on it before it can actually occur, and so I 0:16:41.600 --> 0:16:44.480 don't know you know when that will occur. Tom mentions 0:16:44.480 --> 0:16:47.280 your your philanthropic giving. I think of your reverence for 0:16:47.360 --> 0:16:51.240 history and American institutions, and I wonder what you're looking 0:16:51.280 --> 0:16:53.360 at his in terms of US history. At this point. 0:16:53.720 --> 0:16:55.920 This is such a pivotal moment. There's no no need 0:16:55.960 --> 0:16:58.680 to underestimate that. What are you reading, what are you 0:16:58.760 --> 0:17:01.440 thinking about at this point? Well, let me just mention 0:17:01.560 --> 0:17:04.120 one thing that I'd like all the Americans and anybody 0:17:04.119 --> 0:17:08.159 listening with to pay attention to. UM. The African American 0:17:08.240 --> 0:17:10.440 History and Culture Museum was opened a few months ago 0:17:10.600 --> 0:17:14.520 in washing d C. It is the museum that was 0:17:14.560 --> 0:17:16.960 conceived by John Lewis, or at least that he was 0:17:17.040 --> 0:17:19.840 the person who introduced legislation was signed by George W. Bush. 0:17:20.200 --> 0:17:23.320 Five hundred and forty million dollars was the price tag. 0:17:23.440 --> 0:17:26.479 Two d seventy million came from taxpayers, two hundred seventy 0:17:26.480 --> 0:17:28.960 from philanthropic gifts them throughout the United States, and many 0:17:28.960 --> 0:17:32.080 many of Americans contributed to that, and many Americans gave 0:17:32.320 --> 0:17:35.520 artifacts and other things. We now have people going to 0:17:35.600 --> 0:17:38.520 that museum, and it was expected that the average person 0:17:38.600 --> 0:17:40.159 going to that museum would spend an hour and a 0:17:40.200 --> 0:17:42.679 half touring the museum. The average person is now spending 0:17:42.720 --> 0:17:44.960 six and a half hours, six and a half hours 0:17:45.000 --> 0:17:48.320 because it's such a life changing experience to see the 0:17:48.440 --> 0:17:51.520 history of African Americans in this country, from four hundred 0:17:51.600 --> 0:17:56.200 years of history, through slavery, through Jim Crow Laws, through 0:17:56.200 --> 0:17:58.720 the great accomplishments of African Americans. And I recommend to 0:17:58.840 --> 0:18:01.840 all Americans, white, black, or any color to spend some 0:18:01.920 --> 0:18:04.399 time touring that museum. I regarded as the best museum 0:18:04.520 --> 0:18:07.520 right now uh of its type in in the United States. 0:18:07.600 --> 0:18:10.520 I want to talk about populism, and we only have 0:18:10.560 --> 0:18:13.760 a minute left. People just assume you grew up with 0:18:13.800 --> 0:18:16.720 a silver spoon in your mouth. I don't know why 0:18:16.760 --> 0:18:20.199 that happened, but they just assumed David Rubinstein couldn't be 0:18:20.240 --> 0:18:23.639 that successful with with with without if you didn't you 0:18:23.640 --> 0:18:26.560 grew up a real basic life. Well, my parents were 0:18:26.600 --> 0:18:29.520 not college or high school graduates. My father worked in 0:18:29.520 --> 0:18:32.520 the post office. Uh. I got very lucky in life 0:18:32.600 --> 0:18:35.639 and um now giving back like the anger that you 0:18:35.720 --> 0:18:38.879 see right now, David, within Americas, well, when I was 0:18:38.920 --> 0:18:40.840 growing up, I did believe in the American dream that 0:18:40.880 --> 0:18:43.600 you could work hard and rise to the top. Now 0:18:43.640 --> 0:18:45.959 many people don't believe in that. They believe that they 0:18:46.000 --> 0:18:48.520 are captain there for the Therefore, the social mobility that 0:18:48.560 --> 0:18:51.080 I benefited from is not present. And clearly I had 0:18:51.119 --> 0:18:55.160 some advantages. But uh I, uh, you know, I don't 0:18:55.160 --> 0:18:56.800 know that everybody feels that they can rise to the 0:18:56.880 --> 0:18:59.159 top as they as they as I did. Thank you 0:18:59.200 --> 0:19:01.720 for visiting us with today and again thank you for 0:19:01.800 --> 0:19:06.239 my David Rumstein is where the Carlisle crew from New 0:19:06.280 --> 0:19:22.000 York from Davos, this is Bloomberg back to Davos to 0:19:22.119 --> 0:19:24.159 Tom Keane where we can hear the steam coming out 0:19:24.200 --> 0:19:26.600 of your mouth. A Tom, it's cold there. It is 0:19:26.600 --> 0:19:28.480 cold here. It's ten degrees colder last year, and a 0:19:28.520 --> 0:19:30.520 little bit of snow not record snow that we've seen 0:19:30.560 --> 0:19:34.159 in my thirteen years here. But it is a winter wonderland. 0:19:34.160 --> 0:19:37.840 And I would say, David, the key early theme is 0:19:37.880 --> 0:19:42.240 what we knew uncertainty. But I can't begin to tell 0:19:42.320 --> 0:19:46.120 you the level of uncertainty to confront it last night 0:19:46.160 --> 0:19:49.879 on the trip through Zurich was just remarkable. We have 0:19:49.920 --> 0:19:54.880 a special guest. There are very few sons that pull 0:19:55.000 --> 0:19:59.240 this off. Paul Jacobs did it. His father, to full disclosure, 0:19:59.320 --> 0:20:03.000 was one of my o There's heroes and engineering out 0:20:03.040 --> 0:20:07.879 of New Bedford, Massachusetts and Cornell to San Diego. And 0:20:07.920 --> 0:20:11.320 then there was this company two decades ago that started 0:20:11.680 --> 0:20:14.680 It has something to do with technology, and the Sun 0:20:14.840 --> 0:20:17.920 actually said hey, I'll do this too. He's a double 0:20:17.960 --> 0:20:20.960 E out of Berkeley. Paul Jacobs joined us down. What 0:20:21.000 --> 0:20:22.760 was that like? Was there a point where your father 0:20:22.840 --> 0:20:25.000 sat you down in your seventeen and said you don't 0:20:25.000 --> 0:20:28.200 want to do this now? He was actually always interested 0:20:28.240 --> 0:20:31.760 in me being in engineering, and so you know, he 0:20:31.840 --> 0:20:34.000 just did things to make sure I got interested in 0:20:34.040 --> 0:20:37.200 and I worked there every summer. Uh. You know, when 0:20:37.200 --> 0:20:40.240 I was in grade school, high school and I learned 0:20:40.240 --> 0:20:42.320 how to program early on. Did you use a slide 0:20:42.400 --> 0:20:44.840 rule or were you after that in early days? Yeah? 0:20:45.320 --> 0:20:47.119 Old enough, Yeah, I had to use the slide rule 0:20:47.160 --> 0:20:50.200 in the old things. Tell me about the people here, 0:20:50.440 --> 0:20:53.040 toss around the phrases. You and your father have lived 0:20:53.440 --> 0:20:58.760 technology innovation, and I find engineers the hair curls when 0:20:58.800 --> 0:21:02.240 they see the usage of today. What does technology mean 0:21:02.280 --> 0:21:05.360 for Paul Jacobs? Oh, technology is the way that we 0:21:05.440 --> 0:21:07.720 take an idea out of our head, something that we 0:21:08.000 --> 0:21:11.240 think about, and we turn it into reality and affect 0:21:11.240 --> 0:21:14.399 people's lives. And the coolest thing about Qualcom is that, 0:21:14.880 --> 0:21:16.760 you know, we thought we were going to affect everybody 0:21:16.760 --> 0:21:19.600 in the world's lives with this new technology, and we're 0:21:19.640 --> 0:21:22.000 actually able to execute and make that happen. Let me 0:21:22.040 --> 0:21:24.000 bring in my colleague in New York, David Gurrow, happened 0:21:24.040 --> 0:21:28.600 to go to Cornell, Thanks, sir, Iwin Jacobs. David Gurra, Yeah, 0:21:28.720 --> 0:21:31.000 very proudly. Here, Paul Jacobs, let me ask you about 0:21:31.040 --> 0:21:32.800 so where chip making is headed. I know that you 0:21:32.880 --> 0:21:36.280 unveiled your plans for five G recently at c e S. 0:21:36.880 --> 0:21:39.920 Talk about adoption. Uh, A lot of the world still 0:21:39.920 --> 0:21:42.760 has not yet adopted four G technology. You're talking about 0:21:42.760 --> 0:21:45.399 five G. How quickly can you move along with something 0:21:45.440 --> 0:21:47.439 like that? Well, so five G is going to be 0:21:47.520 --> 0:21:50.920 driven by the end markets. So you got the Koreans 0:21:50.960 --> 0:21:53.399 who want a version of five G in time for 0:21:53.440 --> 0:21:56.320 the Winter Olympics, and then you kind of got the 0:21:56.359 --> 0:22:00.280 standards process. It's going for the Tokyo Olympics in twenty twenty. 0:22:00.280 --> 0:22:03.879 I'm not sure why Olympics are the catalysts how happened 0:22:03.880 --> 0:22:07.560 to be, but anyways, so really cool stuff though, because 0:22:07.560 --> 0:22:09.280 now you're gonna be able to do, you know, things 0:22:09.320 --> 0:22:13.320 like virtual reality and fly drones around and get you know, uh, 0:22:13.640 --> 0:22:16.959 telemetry off of people's bodies to you know, see how 0:22:16.960 --> 0:22:22.359 they're We tried that last night, I want to ask. 0:22:23.320 --> 0:22:26.240 But anyways, so but the interesting thing about five G though, 0:22:26.280 --> 0:22:28.439 is that it's going to go not just into the 0:22:28.440 --> 0:22:30.960 phones and the tablets that we carry around, but into 0:22:31.119 --> 0:22:34.440 all other kinds of devices, whether it's sensors in the 0:22:34.480 --> 0:22:37.280 world around us, whether it's cars or as I said, 0:22:37.400 --> 0:22:41.040 drones and robots and uh, you know, all sorts of things. 0:22:41.080 --> 0:22:44.560 And so we just did a study that said but 0:22:44.720 --> 0:22:49.040 by the time comes around, you know, it'll have been 0:22:49.119 --> 0:22:53.120 integrated wireless connectivity will be integrated to all these different devices, 0:22:53.400 --> 0:22:55.960 and it's gonna create an excess of twelve point three 0:22:56.080 --> 0:23:01.359 trillion dollars of incremental benefit to all these other industries 0:23:01.480 --> 0:23:03.960 that that will make use of it. Paul, And we 0:23:04.080 --> 0:23:06.199 know about Moore's Law, and I wonder what the biggest 0:23:06.240 --> 0:23:08.399 challenge right now is to to chip making, to getting 0:23:08.400 --> 0:23:12.680 more advanced chips. I mean, look, Moore's Law, we still 0:23:12.760 --> 0:23:15.480 have it progressing, but it's slowing down a little bit 0:23:15.520 --> 0:23:18.359 from an economic standpoint, and we are getting close to 0:23:18.359 --> 0:23:21.800 the physical limits of More's law. And I was just 0:23:21.960 --> 0:23:25.639 on a panel for the White House the previous administration, 0:23:26.200 --> 0:23:29.200 uh talking about you know, what are the implications of 0:23:29.240 --> 0:23:33.120 that and and how do we do moonshots to sort 0:23:33.160 --> 0:23:37.240 of uh incentivize the industry to come up with the 0:23:37.280 --> 0:23:39.520 next new thing. How do we go from where we 0:23:39.560 --> 0:23:42.440 are and how do we keep it going? And there's 0:23:42.440 --> 0:23:44.639