Speaker 1: This is Bloomberg Business Week. I'm Carol Masser and I'm
Speaker 1: Bloomberg Quick Takes Tim Stanobek. We're here every day bringing
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Speaker 1: YouTube search Bloomberg Global News. So a lot of headlines
Speaker 1: out about the virus again, Tim, Today, we've got the
Speaker 1: US may recommend wearing two masks to battle more contagious
Speaker 1: variants of the virus. That's according to Dr Fauci, Anthony Fauci.
Speaker 1: You've got more countries in Europe reporting evidence at the
Speaker 1: spread of the UK variant. Isn't creed increasing, which could
Speaker 1: lead to prolonged restrictions. Uh. But we did talk about
Speaker 1: some better news yesterday with death starting to drop across
Speaker 1: the US. Yeah, we did. And and look, I think
Speaker 1: what's exciting to see and I maybe exciting isn't really
Speaker 1: the right term, but we sort of got the slew
Speaker 1: of good news right more development when it comes to
Speaker 1: a new vaccine and new data about vaccine. But at
Speaker 1: the same time, everywhere you look in the United States,
Speaker 1: we are starting to see us get over that latest tump.
Speaker 1: It's something that I've been eager to talk to Dr
Speaker 1: Dave Wessner about. He's a professor of biology at Davidson
Speaker 1: College and joins us right now on the phone from Davidson,
Speaker 1: North Carolina. Professor, it's really great to have you on
Speaker 1: the show. Um, where are we right now in this pandemic? Well,
Speaker 1: thanks for having me. It's like, let's be back again.
Speaker 1: Um yeah, I think we're We're in in a hopeful position.
Speaker 1: I think there's definitely light at the end of the
Speaker 1: tunnel now. Um yeah, I don't think the tunnel is
Speaker 1: necessarily as short as people might hope it would be. Um,
Speaker 1: but but I think with the with the news, with
Speaker 1: the Barrios vaccines are coming out, Um, I think there
Speaker 1: is hope for us. Okay, having said that, let's just
Speaker 1: jump right into the variant and the variants that keep
Speaker 1: coming out. Right, We've got UK, We've got Brazil, We've
Speaker 1: got South Africa. Uh. And I do wonder if there
Speaker 1: is a tipping point in terms of how many and
Speaker 1: by a certain date in terms of getting the COVID
Speaker 1: vaccine out before these variants start to infect too many
Speaker 1: of the global population. You know what, do we need
Speaker 1: to kind of know about that and think about that,
Speaker 1: especially if we're hoping to reopen our economy sooner rather
Speaker 1: than later. Yeah, I think a couple of things. I
Speaker 1: think the appearance of these variants is not at all
Speaker 1: a surprise. This is nothing unusual. Viruses mutate a lot
Speaker 1: bays throughout these variants. The real concern for researchers and
Speaker 1: collisions are, Um, do these variants behave differently in some
Speaker 1: troubling way? Are they more easily transmissible? Do they cause
Speaker 1: worst disease? Um? Are they resistant to immunity vaccine induced
Speaker 1: immunity or natural immunity? So? UM to your question, I
Speaker 1: think that the UK variant B seven is pretty widespread. Yeah.
Speaker 1: I don't think we're you know, we're not putting the
Speaker 1: genie back in the bottle with with a lot of
Speaker 1: these um. It appears though that the vaccines that we
Speaker 1: do have the Maderna vaccine, the Fiser vaccine are probably
Speaker 1: pretty effective against these new variants as well, all of
Speaker 1: them Brazil, South Africa as well. I mean, I mean
Speaker 1: there's different data on different ones, but um, generally yes, yeah,
Speaker 1: I think UM. Researchers from Fiser reported just on on
Speaker 1: Friday that neutralization of the B one one seven the
Speaker 1: UK variant um it was pretty much the same as
Speaker 1: the quote wild type virus with their vaccine was slightly reduced,
Speaker 1: but not in any meaningful way. The South African variant
Speaker 1: um seems to be a little bit more resistant to
Speaker 1: the vaccine, but not to a degree that it's you know,
Speaker 1: we're not gonna say the vaccines are ineffective with that
Speaker 1: with that variant, I mean they're less effective, but not
Speaker 1: necessarily less effective in a really concerning way. David, was
Speaker 1: surprising for me to hear you say that you do
Speaker 1: believe the variant on in the UK is likely widespread here.
Speaker 1: And the only reason it's surprising to me is because
Speaker 1: what we saw happen in London about a month ago
Speaker 1: and in the wider part of the United Kingdom a
Speaker 1: month ago doesn't seem to be happening at least right
Speaker 1: now here in the United States, and I'm talking you know,
Speaker 1: hospitals overcrowded and more and more cases. You see, the
Speaker 1: cases have started to be down a little bit in
Speaker 1: in most places the United States, they were going up
Speaker 1: pretty rapidly until recently. UM, and that may have been
Speaker 1: a result of the holidays and spiking cases from family gatherings.
Speaker 1: One thing that we're not doing as much United States
Speaker 1: as in the UK is this genomic sequencing of the viruses.
Speaker 1: So with the limited amount of sequencing we are doing,
Speaker 1: we seemed this variant in various places. I wouldn't be
Speaker 1: surprised if we did more sequencings. We see it. Um,
Speaker 1: you see a higher problems of that variant here right see.
Speaker 1: I guess question, I guess Tim and I are trying
Speaker 1: to get our heads around as we talked to various
Speaker 1: folks in the medical community and certainly the pharmaceutical industry,
Speaker 1: is you know, should we There's I guess a lot
Speaker 1: of talk about it's going to be another tough February
Speaker 1: March in that way, we're going to get another third wave.
Speaker 1: I don't even know. I've lost count because of these
Speaker 1: because of the variants, specifically and do you anticipate that. Yeah,
Speaker 1: I think it's a very real possibility. I think one
Speaker 1: of the fears that I have is that people will say, oh,
Speaker 1: we have vaccines out there, people are starting to get shot.
Speaker 1: I can sort of went off the gas. I can
Speaker 1: start start relaxing in my my personal mitigation efforts wearing masks,
Speaker 1: especially just in avoiding crowds and so forth. Um. I
Speaker 1: think if if people sort of relax on those strategies,
Speaker 1: then yes, we could see a pretty big uptick pretty quickly.
Speaker 1: So I think it's imperative now that people really, um
Speaker 1: really are conscious about those those relatively simple medication efforts. Hey, Dave,
Speaker 1: very briefly double masking. We heard Dr Anthony Fauci say
Speaker 1: earlier today that the CDC might start to recommend two
Speaker 1: masks because of these variants. What do you what do
Speaker 1: you make of it? That's not going to hurt um? Yeah,
Speaker 1: I think a lot of people have cloth masks on,
Speaker 1: which do reasonally well job. If you have a cloth
Speaker 1: mask on, though, there are gaps from side, gaps from
Speaker 1: the top that are going to let different particles in out.
Speaker 1: Having a second mask on, it's going to reduce those gaps.
Speaker 1: It's going to reduce the spread of the virus from
Speaker 1: you to someone else. If you're infected, it's going to
Speaker 1: reduce your chance of inhaling the virus. Um, you mean
Speaker 1: that that's not gonna hurt me. If that's what it
Speaker 1: takes to to really camp things down, Yeah, I think
Speaker 1: it's that's a reasonable approach. I'm curious about your thoughts
Speaker 1: when it comes to the news that we learned today
Speaker 1: from our Bloomberg colleagues that President Joe Biden's administration is
Speaker 1: going to pilot a program to provide coronavirus vaccines directly
Speaker 1: to pharmacies in an attempt to ratchet up the pace
Speaker 1: of a not culations in the US. It's going to
Speaker 1: be a small pilot to begin with, But is this
Speaker 1: the right way to get to her community? Yeah, I
Speaker 1: think it's worth trying. Yeah. I think we've seen already
Speaker 1: that distribution getting shots in the arm is a logistical challenge. Um,
Speaker 1: So I think it's certainly worth exploring if waltring TBS,
Speaker 1: other farms, single farm seats like that can can help
Speaker 1: in that in that process. Is that is I'm wondering
Speaker 1: if we think about the administration here of of vaccines
Speaker 1: actually giving them. Where are you seeing the bottleneck? Where
Speaker 1: where is the bottleneck company? Because we have to understand,
Speaker 1: I mean, this is what as we've learned and Carol,
Speaker 1: Carol mentioned this, like we never thought we'd become such
Speaker 1: a sort of like armchair experts, right and thinking about
Speaker 1: in thinking about vaccines and actually giving vaccines. But we
Speaker 1: have the production of them, and of course before that
Speaker 1: the approval um and we also have to make sure
Speaker 1: there are enough supplies, right, syringes, needles, people to make
Speaker 1: sure that you know you're being observed for fifteen minutes,
Speaker 1: people who are trained to give the shots. Where do
Speaker 1: you see the bottleneck? Yeah, I think what I've seen
Speaker 1: it's it's distribution. It's getting the vaccine doses to the
Speaker 1: vaccination site to the place we're actually administering them. I
Speaker 1: mean that seems to be things I've heard places around
Speaker 1: here that've gotten vaccines are are using them. I mean,
Speaker 1: they're not wasting the vaccine doses themselves, they're getting them
Speaker 1: in arms. It's just waiting for more vaccines to get there.
Speaker 1: Um and type about vaccine a little bit is a
Speaker 1: vacumment to getting back to the variants A few months ago,
Speaker 1: people were saying, if we get a vaccine that's setting
Speaker 1: percent effective, that's really good. We got to their effective,
Speaker 1: which is amazing. So even if these variants are even
Speaker 1: vaccines are not quite at effective against these variants, they're
Speaker 1: still pretty good vaccines. I think we shouldn't we shouldn't
Speaker 1: lose sight of that we're talking about these variants. Well,
Speaker 1: and it was, you know, there was an interesting column.
Speaker 1: It was a Bloomberg opinion piece um by our Andurias Cluth,
Speaker 1: and it said, stop wanting about vaccines. It's only February.
Speaker 1: And the point being that, listen, folks, it's pretty remarkable
Speaker 1: that we have a vaccine and it's what we were
Speaker 1: working for and Shaman whoever whatever in terms of not
Speaker 1: being ready in terms of the rollout, but you know,
Speaker 1: we've never had to do this, to be quite honest,
Speaker 1: or or it's been a long time. Um. And so
Speaker 1: when you hear something like that, do you agree that
Speaker 1: we need to just kind of understand what we've done
Speaker 1: so far and it is going to just take a
Speaker 1: while to get all these vaccines into the arms of individuals,
Speaker 1: especially when you're talking about two doses. Me. Absolutely, if
Speaker 1: you look at the timeline. The first report came out
Speaker 1: in December, this new virus in in uhan um. So
Speaker 1: in eleven months times twelve months time, we have vaccines
Speaker 1: with the virus identified sequence, we have vaccines on market.
Speaker 1: That's really porkable. So yes, I think the rollout has
Speaker 1: been a bumpy road so far. Um. It can never
Speaker 1: be done fast enough, obviously, but yes, I think we're
Speaker 1: a really good place considering where we were just the
Speaker 1: year ago. And so no, I bet we're going to
Speaker 1: go the same place so so So, Dave, what's your
Speaker 1: best guests in terms of there's enough shots in in
Speaker 1: in people's arms that we can actually start to kind
Speaker 1: of reopen and get back to a more normal way
Speaker 1: of life. Is it and the spring is its summer?
Speaker 1: How do you see it? Just quickly and got thirty seconds. Yeah,
Speaker 1: I think in the summer. I think next fall we
Speaker 1: start looking at Labor Day this coming year, I think
Speaker 1: things will look a lot to do now. Alright, fingers
Speaker 1: cross man um, Dave, thank you so much, really appreciated. Uh.
Speaker 1: Dr Dave Westerner, professor a biology of at Davidson College,
Speaker 1: on the phone from david'son North Carolina. I mean listen.
Speaker 1: It's been an unbelievable undertaking, right, Tim, and we have
Speaker 1: come a long way. I think it just feels like, well,
Speaker 1: wait a minute, we knew we're gonna have to get
Speaker 1: these into the arms of individual we were and I
Speaker 1: think January was a really hard month for a lot
Speaker 1: of people. We had a tremendous loss of life in
Speaker 1: the United States, more than people. And I think just
Speaker 1: the fact that it's winter and we've been doing this
Speaker 1: for so long, we were so ready to see the
Speaker 1: sun again. Yeah, and um, yeah, I think it's starting
Speaker 1: to feel very long for people. This is Bloomberg Business
Speaker 1: Week with Carol Messer and Bloomberg Quick Takes Tim Stinovich
Speaker 1: from Bloomberg Radio. All right, now, we want to get
Speaker 1: to a story that's going to be featured in the
Speaker 1: upcoming issue of Bloomberg Business Week magazine. We know actions
Speaker 1: have consequences. We say that a lot. Tim. It applies
Speaker 1: to story by Bloomberg News energy reporter Robert Tittle, who
Speaker 1: writes about it and writes specifically that President Biden's recent
Speaker 1: Keystone XL cut off has really hurt and shocked a
Speaker 1: tiny town up in Canada. Let's get more Robert joins
Speaker 1: us on the phone from Calgary, along with Bloomberg business
Speaker 1: Week editor Joe Webber on the access line in Brooklyn.
Speaker 1: And I feel like Joel the Keystone Pipeline man, on again,
Speaker 1: off again, on again, off again. Yeah, it's right, and
Speaker 1: and this story is one of those ones that I
Speaker 1: do and kind of just speaks to um sort of
Speaker 1: the the West. I think of it in terms of
Speaker 1: American West a lot, but certainly applies to Canada. There's
Speaker 1: been you know, just hundreds of towns through the history
Speaker 1: of of the countries that um that have boom and
Speaker 1: bus cycles, and this is sort of one of them.
Speaker 1: This is this is a town um that we'll talk
Speaker 1: a little bit about that you know, really kind of
Speaker 1: tethered its fortune to the Keystone Pipeline. And then obviously
Speaker 1: when when President Biden came out um and sort of
Speaker 1: changed policy there, it has repercussions UM down that pipeline.
Speaker 1: So so Robert talked to us about the town that
Speaker 1: you decided to set all of this in. Yeah, So
Speaker 1: I I uh one morning got up real early and
Speaker 1: drove the east out of Calgary three hours. It's uh
Speaker 1: the town of o um. Uh. It's close to the
Speaker 1: Saskatchewan borders. Um. It's a rural, very rural. It's a
Speaker 1: farming town of some ranches around there. Um, branches around there.
Speaker 1: But this town was kind of ground zero for the
Speaker 1: Keystone Xcel construction work which had kicked off last year,
Speaker 1: and that had that had been uh caused the town
Speaker 1: population to just about double uh for a period there
Speaker 1: and especially during the summer and the fall. As the
Speaker 1: workers were coming in to build the pipeline, they set
Speaker 1: up some camps. Businesses were raking in a lot of money,
Speaker 1: up to four million Canadian dollars a month extra. That's
Speaker 1: what the mayor told me. Um. And that kind of
Speaker 1: just came to a halt when the project was canceled
Speaker 1: by Joe Biden on his first day in office. Um.
Speaker 1: So it was how yeah, how quickly has the town
Speaker 1: sort of reeled from from that decision? What what was
Speaker 1: the before and what does the after start to look like? Well? Um,
Speaker 1: I mean when I got the area, it was a
Speaker 1: few days after, and uh, the things were still they
Speaker 1: were still kind of up in the air a little bit. Um.
Speaker 1: It didn't seem like that they had yet adjusted, but
Speaker 1: people were had but workers were leaving. Um. You know,
Speaker 1: before that you had about a thousand extra people. This
Speaker 1: is a town of just under a thousand people. You
Speaker 1: had about a thousand extra people living there, uh and
Speaker 1: doing business there. Workers. Uh. You know, after that, they
Speaker 1: were it was clear some people were starting to leave,
Speaker 1: but things were still kind of up in the air. Um.
Speaker 1: There was a lot of construction along the route which
Speaker 1: went passed through the area. Uh. There was a lot
Speaker 1: of type pipeline pipeline left in some storage yards along
Speaker 1: those areas. Uh. And when I was there, there weren't
Speaker 1: You didn't see a lot of workers, um, workers in
Speaker 1: these sites. Uh there, but there were still workers there.
Speaker 1: There were still there's still some work to do in
Speaker 1: terms of just cleaning up what was left. Sorry, I
Speaker 1: started to jump in. I do wonder Carol made the
Speaker 1: made the reference to this on again, off again, you
Speaker 1: know comment with the keystone xcel. I do wonder if
Speaker 1: this cancelation is final? I mean, is this the final blow? Yeah,
Speaker 1: I mean it's it's I mean, this has been around
Speaker 1: for twelve years, more than twelve years. The project was
Speaker 1: canceled once before by President Obama. It was brought back
Speaker 1: by UM. Uh, the President Trump now this looks a
Speaker 1: lot more final, simply because the sort of UM. There's
Speaker 1: sort of a strong turn against the oil sands. So
Speaker 1: the oil fans themselves are are not expanding the oil
Speaker 1: fans producers are not expanding it very much anymore UM,
Speaker 1: and it doesn't look like that will happen for for
Speaker 1: a while still. At the same time, so that there
Speaker 1: isn't as much need for this pipeline, there's also a
Speaker 1: couple other pipelines that are being built and that are
Speaker 1: going to be enough for the oil stands industry at
Speaker 1: least into this decade, so it doesn't seem like there's
Speaker 1: as much of a need for it. UM. I think
Speaker 1: the industry did want to get this pipeline built. There
Speaker 1: are people I've spoken to, including a former executive of
Speaker 1: of TC Energy, who said he thinks it could still
Speaker 1: come back to life and about in another administration, but
Speaker 1: but there is a turn against this at the moment.
Speaker 1: It does seem to be a change. And how has
Speaker 1: that played out just in Canadian politics. Yeah, so that's
Speaker 1: been very That was really interesting here in Alberta. The
Speaker 1: government itself wanted to get this project going UM and
Speaker 1: the company UM was holding back um to see what
Speaker 1: would happen. I think at the end of the election,
Speaker 1: that's what the premier here said for us and Kenny.
Speaker 1: So they actually invested one point five billion Canadian tax
Speaker 1: player dollars I mean Alberta tax payer dollars in the project.
Speaker 1: The UM that was just to get a jumpstart, jump
Speaker 1: start construction. That was and that started the past spring.
Speaker 1: At the time, the premier said that he wanted to
Speaker 1: create facts on the ground that would make it hard
Speaker 1: to you know, hard to for any administration to come
Speaker 1: in to cancel this this project. The company also signed
Speaker 1: a bunch of labor agreements with unions of the United States.
Speaker 1: They agreed they also agreed to sell a stake to
Speaker 1: some um indigenous communities along the route, which many of
Speaker 1: these communities are. Many indigenous communities have have spearheaded opposition, right,
Speaker 1: so they did everything possible I think to sell this
Speaker 1: to a future bid administration. That wasn't enough. UM and
Speaker 1: uh certainly yeah, no, no, no, no, We've got to
Speaker 1: unfortunately wrap it up. But um, we'll put it out
Speaker 1: on Twitter, Robert, because it's a it's a great story
Speaker 1: and as you know, include in it. There's the other
Speaker 1: argument that says, if we don't do it this way,
Speaker 1: we're gonna have to do it on rail cars, which
Speaker 1: can be um, have their own economic impact and climate
Speaker 1: impact and be dangerous. So there's a lot of moving
Speaker 1: sides to this story. Um, thank you so much, Robert Tuttle.
Speaker 1: Check it out and of course our thanks to Joe Webber.
Speaker 1: You're listening to Bloomberg Business Week with Carol Messer and
Speaker 1: Bloomberg Quick Takes Tim Stenovic on Bloomberg Radio. All right, yes, indeed,
Speaker 1: you're listening to Bloomberg Business Week Karl Masser along with
Speaker 1: Tim Stenovich. And Um, I keep hearing Mr Planters or
Speaker 1: plant and I'm thinking, right, Mr Peanut, Yeah, I can
Speaker 1: think of every time I hear that story. Um what
Speaker 1: I'm just thinking he's going to get on a tangent here.
Speaker 1: But remember the Super Bowl ad last year? Is that
Speaker 1: what you're talking about? Okay, It's just like, right, that's
Speaker 1: all I keep thinking about. Yeah, okay, Um, yeah, that's
Speaker 1: what I was thinking too. Hey, But holder sound pretty happy.
Speaker 1: I know. Right. It's like we're seeing companies do deals
Speaker 1: and kind of you know, lean more into certain you know,
Speaker 1: business lines and strategies and speaking of that. We saw
Speaker 1: that certainly play out today one of our top business
Speaker 1: stories M and A stories Uber doing another deal, buying
Speaker 1: up the alcohol delivery startup. It's drizzly. They spent one
Speaker 1: point one billion. You mentioned earlier. It was a stock deal. Uh,
Speaker 1: so they're taking advantage of the run up that they've
Speaker 1: seen and share. So what does it mean? What does
Speaker 1: it mean for the bottom line the overall strategy. Let's
Speaker 1: bring in Bloomberg News Venture capital reporter Lazette Chapman. Tim.
Speaker 1: You actually caught up with her earlier on Quicktake, and
Speaker 1: she's back with us on the phone in San Francisco. Lizette,
Speaker 1: good to have you. We're still I think we're still
Speaker 1: waiting together. Is that right now? In the meantime, fantastic.
Speaker 1: I knew you were there wait and wait to talk
Speaker 1: about this big acquisition from over So let's let's talk
Speaker 1: about it. Did you say doozy? Did you say doozy?
Speaker 1: If an acquisition, well, I said boozing These two at
Speaker 1: one point one billion, that does not pump change. Um.
Speaker 1: It's uh. You know the first acquisition Uber done to
Speaker 1: his Postmates for two point six billion last year, and
Speaker 1: it really shoes up what Uber has been driving out
Speaker 1: for the past year, which is that, hey guys, we're
Speaker 1: going to offload all these other best in flying cars
Speaker 1: and the self you know, driving technologies, and we're just
Speaker 1: going to focus on two things that can help us
Speaker 1: be profitable, remember they're not yet, which are delivery and rides.
Speaker 1: And people really like their Booze and this allows them
Speaker 1: to really increase um all the different markets they serve
Speaker 1: through a bunch of partnerships and the software that deals
Speaker 1: with all those nasty uh you know, back office issues
Speaker 1: like what counties or dry counties and you know across
Speaker 1: the nation, which it gets kind of complicated once you
Speaker 1: dig in. Well, that that was you know, we talked
Speaker 1: about this earlier on Quick Take Lizette because I asked
Speaker 1: you the question, why does an uber just develop it themselves?
Speaker 1: It turns out it's actually pretty difficult to you know,
Speaker 1: make sure you're following all the rules when you're delivering booze, right, Yeah,
Speaker 1: it is. You know, it's complex, and this is a
Speaker 1: Boston they start up. Um, you know, they've been doing
Speaker 1: this for eight years and they um really focused on
Speaker 1: meeting the legal requirements first, um, which is you know,
Speaker 1: different than the way Uber and some other companies have
Speaker 1: have approached a new category UM. So it'll be interesting
Speaker 1: to see how this plays out and whether the big
Speaker 1: surgeon and drinking continues after the pandemic. Well, that's that's
Speaker 1: the huge question. I mean, we've had a fair amount
Speaker 1: of pitches and we've had guests on where are tapping
Speaker 1: into this lazette, this whole idea. We've been home, people
Speaker 1: have been drinking more UM and so we've definitely seen
Speaker 1: you know, that happened. But I do wonder when we
Speaker 1: get on the other side, aren't we going to be
Speaker 1: maybe hopefully in a restaurant after you're drinking in a
Speaker 1: restaurant you used the Uber app to call an uber
Speaker 1: to get you home safely? Right? Is that the next
Speaker 1: you're just going to tie it all together that maybe maybe?
Speaker 1: I mean, that's definitely what Uber is hoping. And you know,
Speaker 1: you look at all of these delivery companies. You look
Speaker 1: at door, DAP, you look at Insta Cards, both of
Speaker 1: those companies on the precipes of I POS. They've seen
Speaker 1: huge valuation surges and their recent fundings UM and they've
Speaker 1: raised a ton from venture capital and other um. You know,
Speaker 1: financiers who are betting on the fact that this just
Speaker 1: convenience and it's almost like a necessity. Now will become
Speaker 1: a habit, right, this thing of everyone being shut in, Well,
Speaker 1: now it's just convenient, it becomes a habit. And Uber
Speaker 1: has long wanted to be your everything, you're operating system
Speaker 1: for your life. I think is the way that it
Speaker 1: was described over a year ago, pre pandemic. And they
Speaker 1: we're going to link everything altogether. But you know again,
Speaker 1: I mean the focus is really squarely on turning a
Speaker 1: profit for this company. They are going to be reporting
Speaker 1: your earnings. Um uh you know a little bit later
Speaker 1: this month, and um, you know the margins on alcohol
Speaker 1: you can't beat those. So this has been um you know,
Speaker 1: this has been something that a number of their competitors
Speaker 1: also took a look at. We just have we just
Speaker 1: updated our story. We got some new reporting in that
Speaker 1: um you know, tips to the fact that door Dash
Speaker 1: and also go Puff, Um you know, took a look
Speaker 1: at at this company. Um they wound up not you know,
Speaker 1: reaching reaching a deal. And interestingly enough, um, there was
Speaker 1: there's a piece of Drizzly, which is cannabis delivery. It's
Speaker 1: a standalone piece called lance or that they operate and
Speaker 1: it's not coming with the deal. Ubert has not commented
Speaker 1: on on why wouldn't wouldn't elaborate on that. We're still
Speaker 1: trying to get some details that you when when we do,
Speaker 1: but um, that's where it stands. Yes on booze, no
Speaker 1: on no. I mean, if you think restrictions around delivering
Speaker 1: alcohol are are challenging, I can't imagine what they are around,
Speaker 1: you know, a nationwide delivery program for cannabis in states
Speaker 1: where it is legal. Um. I do wonder about investors
Speaker 1: in Drizzly. You have a note in your story that
Speaker 1: the last valuation was seventy three million dollars for the
Speaker 1: company back into when seen, uh correct over a billion
Speaker 1: dollar purchase. Yeah, that was according to pitch Book, which
Speaker 1: is a research firm. Um and they listed that as
Speaker 1: the last valuation, which you know if they you know,
Speaker 1: did not adjusted after that. And again it's been a
Speaker 1: company that's been pretty pretty quiet. It started with a
Speaker 1: burst of a bunch of similar companies. I think there
Speaker 1: was like there was more than a half dozen in
Speaker 1: this area. There was Mini Bar and Saucy and all
Speaker 1: of these other ones. And they all emerged with this
Speaker 1: idea of on demand booz delivery, um, you know, and uh,
Speaker 1: they all reached a certain amount and then you know,
Speaker 1: some of them just kind of you didn't really hear
Speaker 1: from anymore. And that happens in startup land because vcs,
Speaker 1: you know, really only talk about companies, really only talk
Speaker 1: about when they're when they're expanding and when they're growing,
Speaker 1: and then they just kind of quietly die away, you know,
Speaker 1: they don't they don't really go out and say, hey,
Speaker 1: we're really not doing well right now and we're going
Speaker 1: to close shops. So you know, this is one, This
Speaker 1: was the leading one, it was the largest one. It
Speaker 1: had out raised all their competitors, so it's not a
Speaker 1: huge surprise, but this was the one that was left standing.
Speaker 1: Uber just quickly still unprofitable, correct, Yep, you got that right.
Speaker 1: I mean I was just looking at revenues. I mean
Speaker 1: we're talking about what eleven billion dollars in revenues maybe
Speaker 1: for this year or fiscally year, and it's a hundred
Speaker 1: and five billion dollar market cap company just got twenty
Speaker 1: seconds here. I mean, hard to get your head around that. Right.
Speaker 1: It is not profitable. It's never been profitable. But uh
Speaker 1: CEO Dara Shock. He has pledged and then reiterated that
Speaker 1: pledge multiple times as recently as you know, uh you know,
Speaker 1: months ago, maybe even less, saying we will hit a
Speaker 1: profit this year regardless of what happens with COVID. That's
Speaker 1: a hell of a bart across, considering their rides are
Speaker 1: have been deathmated. But it's one that he has said
Speaker 1: that they're going to commit to and hopefully delivery can
Speaker 1: help them. Alright, So glad we got to check in
Speaker 1: with you. Bloomberg News vetra Capital reporter Lizette Chapman. Check
Speaker 1: her out on Twitter. D Yeah, but you let me
Speaker 1: drive nor home, honey, please, I'll do the riding revels.
Speaker 1: Met I want to drive, Just drive baby, question. Trying job.
Speaker 1: This is the drive to the Globe Commune. Thanks, we'll
Speaker 1: drying us down on Bloomberg Radio. All right, folks, just
Speaker 1: about eleven minutes left in today's trading session. Let's get
Speaker 1: to the drawing to the clothes. John Trainer is back
Speaker 1: with US Chief Investment Officer. He's over at People's United
Speaker 1: Wealth Management, our People's United Advisors. Forgive me. They've got
Speaker 1: nine billion in assets under management. And he is in Bridgeport,
Speaker 1: Connecticut on this Tuesday. John, how are you? How are
Speaker 1: you doing? I'm doing very very well. Thank you for
Speaker 1: having me back. What a wacky couple of weeks. What
Speaker 1: a wacky first start to the year. Um, what are
Speaker 1: your clients asking about? What are you thinking about when
Speaker 1: it comes to the market here as we started off
Speaker 1: our second trading month of the year. Well you characterize it, well,
Speaker 1: what a what a crazy start to the year? Technical
Speaker 1: term active, that's right, very technical term. And and really
Speaker 1: you know, the the you know, the the big question
Speaker 1: is you know, g am I involved in in the
Speaker 1: game stock and we tell them no, that that's not
Speaker 1: something that that we do. But you know, our big
Speaker 1: concern is that a lot of clients they look at
Speaker 1: this and they say, boy, you know, I've got my
Speaker 1: whole I RA or my four oh one k invested.
Speaker 1: Here is Wall Street at casino. And that would be
Speaker 1: the real disaster if if the average investor looked at
Speaker 1: this and just said to heck with this, I'm I'm
Speaker 1: getting out, and uh, you know it's it's it's a mess.
Speaker 1: So we've been doing a lot of triage, basically telling people, look,
Speaker 1: this is a small corner of the market. You know,
Speaker 1: there's nothing intrinsically wrong with with short selling and doing
Speaker 1: things like that. It's just you had a confluence of
Speaker 1: events here that what got a sector of the market crazy.
Speaker 1: But overall things are still good and you still want
Speaker 1: to stay invested. So what specifically have they've been have
Speaker 1: they been asking you about what happened last week? When
Speaker 1: you use the word like triage, I want to know more. Yeah. Well,
Speaker 1: you know, whenever I get a call from my mother
Speaker 1: asking me if she's involved, I know, oh, things have
Speaker 1: gone too far. So you know, triage to me is
Speaker 1: basically calming down people and just you know, walking them
Speaker 1: through it, explaining you know, what happens uh with with
Speaker 1: the shorting of the market and short squeezes and things
Speaker 1: like that, and basically telling them, look, unfortunately, you know,
Speaker 1: the people that tend to get into these types of
Speaker 1: trades late are the ones that get burned. I mean
Speaker 1: you you know, you you started all this segment with
Speaker 1: you know a lot of those stocks being down quite
Speaker 1: a bit today, So I hope people aren't. You know,
Speaker 1: we aren't seeing a lot of people lose money, But
Speaker 1: you know, it's it's basically calming people down and telling
Speaker 1: them focus on the long term. Were they're really investors worried?
Speaker 1: I mean, none of this is really new. I feel like,
Speaker 1: you know what I mean, we've seen, you know, certain
Speaker 1: hedge funds get squeezed before. Um, I just I'm curious,
Speaker 1: you know, were they really nervous that all of a
Speaker 1: sudden they're like, wait, this is a casino. Yeah, it
Speaker 1: came up. And then again, you know, we we hear
Speaker 1: that the hedge funds investors are such sophisticated investors. I
Speaker 1: frankly am very surprised. I mean you could read Marin's
Speaker 1: and see that game stock had a very very big
Speaker 1: short position. This this was known. Uh, that a lot
Speaker 1: of the hedge funds were caught like this is really
Speaker 1: a surprise to me. So I know, I think that's
Speaker 1: that's it. How the heck could something like this happen?
Speaker 1: That tends to be the tone of the question. Do
Speaker 1: we have to ask you though? Do you think we
Speaker 1: need to change all of a sudden the system or
Speaker 1: bring in a bunch of regulatory oversight or I mean personally,
Speaker 1: it's like, as you said, game stops short position was
Speaker 1: fairly well known that in some ways. You know, it
Speaker 1: was an easy trade to go in the other direction
Speaker 1: and do that short squeeze. Yeah. You know, I was watching, uh,
Speaker 1: some of the politicians on the Sunday talk shows, and
Speaker 1: naturally I think there's a knee jerk reaction. Oh, you know,
Speaker 1: we've got to crack down on those bad Wall Street people.
Speaker 1: You know again, you know, shorts dollar shallows actually serve
Speaker 1: a very useful function in the market. Being able to
Speaker 1: buy call options on stocks are very useful. I think,
Speaker 1: you know, you need to put this in a box
Speaker 1: and say, this was a very unique uh you know,
Speaker 1: a lot of people made money, a lot of people
Speaker 1: lost money, but it was a very unique situation. And
Speaker 1: let's not just rush and implement some regulations that there
Speaker 1: really could hurt us in the long run. And some
Speaker 1: of the proposals I heard over the weekend were just nonsensical.
Speaker 1: So that is a risk we get some some regulations
Speaker 1: that just don't make sense. So here we are in
Speaker 1: the midst of earning season, sort of the tail. And
Speaker 1: when it comes to big tech, Alphabet and Amazon reporting
Speaker 1: after the bell today, what are the questions that you'd
Speaker 1: ask management. We'll start with Amazon first. You know, well,
Speaker 1: you know, that's one of one of the stocks that
Speaker 1: we have in our model portfolio. And again, you know,
Speaker 1: Amazon has done very very well. They've been to go
Speaker 1: to retailer. What we're looking for is to try and
Speaker 1: determine how much of this extraordinary growth is sort of
Speaker 1: a blip and as we get as we sort of
Speaker 1: return to normal, let's say we returned to the new
Speaker 1: new normal, what is a good estimate for earnings on
Speaker 1: their core business. We think it's we think it's very solid.
Speaker 1: We think that they've they've picked up a lot of
Speaker 1: new business that they're going to keep, but we know
Speaker 1: we saw blip last year, so how much of that
Speaker 1: should we be factoring in going forward? So it's it's
Speaker 1: really the sustainability of their their new customers basically when
Speaker 1: when it comes to Amazon, and we think it will
Speaker 1: be a very good earnings report. Yeah, I mean, listen,
Speaker 1: I think you know what happened in the pandemic. It
Speaker 1: was a game changer for a lot of folks saying
Speaker 1: I've never bought grossories before. Man, this is pretty easy.
Speaker 1: I'm going to continue doing that exactly, and the sticking
Speaker 1: us of it will be something that we certainly have
Speaker 1: to to watch. Having said that, you know that is
Speaker 1: a name. I'm just taking a look at what we
Speaker 1: saw in the last year. I mean that had a
Speaker 1: really decent bump up what seventy Um, I'm just looking
Speaker 1: year of a year here right now. Yeah, in a
Speaker 1: is it a little price e do you at this point? Well?
Speaker 1: It is, yeah. And you know I've got a great
Speaker 1: chart and the presentations that I make to uh, you know,
Speaker 1: I'm all all over New England, all over the northeast.
Speaker 1: I'm making presentations to different groups, and I've got a chart.
Speaker 1: You know, it's one that we've all seen, you know,
Speaker 1: sort of the how did the big five stocks do
Speaker 1: versus the other four nine stocks in the SP and
Speaker 1: you know, we we saw a huge gap last year.
Speaker 1: Our estimate this year is that we see a little
Speaker 1: bit of a reversal that those four hundred and nine
Speaker 1: five stocks that that's underperformed last year, that they actually
Speaker 1: do better than the five. We still think that tech stocks,
Speaker 1: you know, they're great companies and they'll do well, but
Speaker 1: we actually would rather see the four beat the beat
Speaker 1: the five this year and that would be a healthier market.
Speaker 1: So a couple of favorites from that group of four
Speaker 1: hundred and we only have about twenty seconds. Well, you know,
Speaker 1: what were the three areas that were most interested in
Speaker 1: our industrials, uh, financials and consumer discretionary. Those are the
Speaker 1: three areas. That's that's the reflation trade. You're seeing that
Speaker 1: in the market today. So you know, in the in
Speaker 1: the industrial area, you know, we we we like Commons Uh,
Speaker 1: Commons Engine. I mean it's a it's a good company.
Speaker 1: It should do well, especially if we get some infrastructure spending.
Speaker 1: You know. In the in the financial area, we like
Speaker 1: the you know, not so much the money center banks
Speaker 1: with some of the the smaller banks. So we own
Speaker 1: zion Um. You know, we're we're going for those types
Speaker 1: of types of names. Yeah, Commins. I was just looking
Speaker 1: at twenty seven higher in last year's trade. Listen. Thank
Speaker 1: you so much, John really appreciated. John Trainer, chief investment
Speaker 1: officer at People's United Advisors, joining us on the phone
Speaker 1: from Bridgeport, Connecticut. Thanks for listening to Bloomberg Business Week.
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