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Speaker 1: Brought to you by B A s F. We create Chemistry.

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Speaker 1: This is Masters in Business with Barry Ridholds on Bloomberg Radio.

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Speaker 1: This week on the podcast, I have a guest named

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Speaker 1: Gianni Kovachevik. It's taken me a while to learn how

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Speaker 1: to pronounce that precisely. He is the author of My

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Speaker 1: Electrician drives a Porsche, and he is an angel in

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Speaker 1: venture investor specializing in energy and alternative technologies. UH. He

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Speaker 1: also just took a Tesla and drove from Toronto to

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Speaker 1: Boston to Florida, all around the United States, ended up

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Speaker 1: in California and went to the Tesla plant. That's where

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Speaker 1: his trip UH finished up, and we chatted about everything

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Speaker 1: from the new technologies, what's taking place in China, alternative energies,

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Speaker 1: the rise and continue demand for copper, and why oil

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Speaker 1: is probably not your best long term investment. If you

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Speaker 1: are at all interested in automobiles, electricity, venture investing, or

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Speaker 1: alternative energy, I think you'll find this to be a

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Speaker 1: fascinating conversation. Without any further ado my chat with Giannikovich Evic.

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Speaker 1: This is Masters in Business with Barry Ridholts on Bloomberg Radio.

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Speaker 1: My guest today is Gianni covic Efic. He is the

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Speaker 1: author of the book My Electrician Drives a Porsche, investing

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Speaker 1: in the rise of the new spending class. He is

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Speaker 1: also a venture investor as well as resident of Vancouver, Canada.

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Speaker 1: Speaks multiple languages, English, German, Italian, Croatian. Just for you're

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Speaker 1: only stopping it for um Gianni. Welcome to Bloomberg. It's

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Speaker 1: so nice to be in New York Berry. So so

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Speaker 1: let's jump right into who you are and what you

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Speaker 1: do when when people ask you, what do you do?

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Speaker 1: How do you answer that question? I am a curious investor.

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Speaker 1: I follow trends. I try to be um. You know,

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Speaker 1: I can turn myself to be a value investor, so

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Speaker 1: I'm not really a trader. I want to look at

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Speaker 1: deep value and effectively. I don't want to invest in

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Speaker 1: the story on page one is my friend Don Cox

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Speaker 1: would say that's the efficient market. I want to invest

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Speaker 1: in the story on page sixteen that's headed to page one.

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Speaker 1: So I'm trying to make a career out of investing

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Speaker 1: on page sixteen stories. So, so what's your background? How

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Speaker 1: did you get into this line of business? I'm from Vancouver, Canada,

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Speaker 1: and what software is to Seattle is what let's say,

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Speaker 1: energy commodities, natural resources are to Vancouver, Canada. So a

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Speaker 1: lot of my friends we grow up and they become stockbrokers,

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Speaker 1: other ones become geologists, engineers, and just you end up,

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Speaker 1: you know, entering the workforce and there it is. It's

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Speaker 1: so important to basically Canada, in that part of our country,

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Speaker 1: particularly that you're just indoctorate into it, no different than

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Speaker 1: someone from as I say, Seattle or San Francisco would

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Speaker 1: get involved in software computers. And for those people who

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Speaker 1: have never been in Vancouver, one of my favorite cities

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Speaker 1: in North America and absolutely beautiful. Um So let's talk

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Speaker 1: a little bit about the entrepreneurial spirit, which very much

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Speaker 1: colors your book you're writing, what you focus on. How

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Speaker 1: do you become an entrepreneur in a place like Vancouver.

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Speaker 1: I know a lot of people up there who ultimately

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Speaker 1: ended up moving to Seattle, New York, San Francisco, even

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Speaker 1: Los Angeles. What what's life like in Vancouver for a

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Speaker 1: entrepreneur who might be more interested in things like software

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Speaker 1: and technology than as as one friend calls its sticks

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Speaker 1: and stones, timber and minerals. Well, that's where my heart

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Speaker 1: beats is supporting these things that I would say that

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Speaker 1: you don't want to give society what they think they

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Speaker 1: need or what they think they want. You want to

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Speaker 1: give them what they do not have and what they

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Speaker 1: what they don't already know that they want. We've seen

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Speaker 1: examples from them, from Henry Ford in the car from

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Speaker 1: the iPhone and Steve Jobs. The old joke is don't

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Speaker 1: skate to where the puck is, skates where it's going

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Speaker 1: to be absolutely and so when you're looking at that

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Speaker 1: as an investor, I'm looking for people that are listening

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Speaker 1: to the music, They're not getting confused by the noise.

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Speaker 1: Classic page sixteen story or stories as investors. So entrepreneurial

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Speaker 1: ship is you know people in groups that want to,

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Speaker 1: you know, buy into that. You can see it, like

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Speaker 1: Warren Bufett would say, when something is so obvious you

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Speaker 1: don't even need a pencil and paper to figure it out.

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Speaker 1: It's like, you know, we've all heard of those ideas

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Speaker 1: that even that that Internet protocol or that app or

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Speaker 1: that gizmo in the past years and just say, wow,

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Speaker 1: that'll succeed. It's just so intuitive. And I think when

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Speaker 1: you're creating these visions as an entrepreneur, you're also managing

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Speaker 1: you know, it's a lot of psychology, a lot of

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Speaker 1: a lot of sort of relationship building. The bigger and

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Speaker 1: organization gets you end up managing all these personalities. So

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Speaker 1: you want to find those mavericks that a create the

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Speaker 1: product that people want to need in the future and

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Speaker 1: they have the ability to stick handle that business as

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Speaker 1: it grows, you know, So how do you how do

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Speaker 1: you find that? While it takes a long time, I

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Speaker 1: think you need you know, years and years and years

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Speaker 1: of experience. You lose money, you win with this guy,

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Speaker 1: you win with that guy, and and you know, after

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Speaker 1: maybe fifteen or twenty years of experience, hopefully you can

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Speaker 1: narrow that down a little bit to have more winners

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Speaker 1: and losers. Don't don't we run the risk? Let me

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Speaker 1: push back a little bit on you. Don't. Don't we

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Speaker 1: run the risk of a little hindsight bias. Um. I

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Speaker 1: can't begin to tell you how many things that are

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Speaker 1: wildly successful today and everybody thinks, oh, sure, of course

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Speaker 1: that was a winner when they were first rolled out.

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Speaker 1: People look various scans at it. My favorite story is

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Speaker 1: Fred Smith, the guy who founded FedEx. It was a

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Speaker 1: graduate school paper and I think you got a d

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Speaker 1: and the professor said, why would anybody pay a premium

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Speaker 1: for overnight delivery when you have the post office? So so,

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Speaker 1: how much of of us looking at these things is obvious?

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Speaker 1: Is a little bit of hindsight bias as opposed to,

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Speaker 1: or ask differently, how can we really identify these things

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Speaker 1: in advance when no one really has a clue what's

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Speaker 1: gonna catch on or what's not? The answer is the

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Speaker 1: short answers. As you know, it's difficult. If it was easy,

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Speaker 1: you know, we'd all be billionaires, you know, And if

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Speaker 1: it was easy, they would call it snowboarding. You know.

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Speaker 1: It's something you learn in a few days. It's not.

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Speaker 1: I don't think when a trend gets underway, let's liken

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Speaker 1: it to a parade. It's very hard to create a parade.

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Speaker 1: But when you see it and when it's obvious, you

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Speaker 1: know you can it's going on. It's you want to

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Speaker 1: jump into that parade. You don't need to be the

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Speaker 1: lead float. You need just need to be in it.

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Speaker 1: You know, you need to understand. And because you have experience,

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Speaker 1: meaning you've kicked the tires, you don't go one day

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Speaker 1: to the next and say, oh, you know, um, Uber

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Speaker 1: is going to be something that's going to be important

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Speaker 1: to the world. I think if you're you have to

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Speaker 1: sort of understand how mobile technology evolved, and you don't

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Speaker 1: come in one day to the next. It happened, you know,

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Speaker 1: with the iPhone in two thousand seven, apps started to

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Speaker 1: be developed. So already, hey, you use the first time,

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Speaker 1: you said, Holy smokes, this this works. I get it.

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Speaker 1: Uber has of course been a private company, so most

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Speaker 1: people out there can't investor don't have the ability to

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Speaker 1: invest in those things, you know, when you can go

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Speaker 1: on and on and on, and I think we we

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Speaker 1: talk a little bit about, you know, trend building and

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Speaker 1: the way people can get themselves versed on this stuff

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Speaker 1: is subscribe to bloggers, newsletter writers, go to really high

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Speaker 1: quality conferences, get the collective opinion of many people and

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Speaker 1: their ideas, and you yourself will come up with your

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Speaker 1: own sort of trends that you can follow. I'm Barry Ridhults.

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Speaker 1: You're listening to Masters in Business on Bloomberg Radio. My

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Speaker 1: guest today is Gianni covic Efic. He is the author

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Speaker 1: of My Electrician Drives a Porsche, which is a look

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Speaker 1: at investing in the rise of the new spending class.

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Speaker 1: And let's talk a little bit about driving in cars.

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Speaker 1: And and you just completed a very interesting trip. You

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Speaker 1: went across country in a Tesla. How did that come about. Yeah,

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Speaker 1: the my book has nothing to do with fast cars.

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Speaker 1: It has everything to do with, as we say in

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Speaker 1: the subtitle, investing in the rise of the new spending class.

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Speaker 1: And it's this story about a young electrician and his

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Speaker 1: family doctor. So it's all about the electricity. It's all

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Speaker 1: about the electricity. And so so let's let's we're gonna

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Speaker 1: talk about this in a few moments. Let's talk about

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Speaker 1: the cross country trip and how that worked powered by electricity. First,

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Speaker 1: what made you think of doing that? We wanted to

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Speaker 1: do a special book tour. I wanted to have something

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Speaker 1: that's not your you know, you go to ten or

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Speaker 1: twelve cities. So I figured, m I can showcase to

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Speaker 1: the world. In my opinion, the future is now with

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Speaker 1: respect to electric cars. So you have to exaggerate these things.

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Speaker 1: You know, you've got to go from, you know, around

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Speaker 1: the entire nation. I was also able to visit more cities,

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Speaker 1: I was able to talk to more people, and I

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Speaker 1: was able to engage with them. Be it be a government,

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Speaker 1: be at investors, be at regular society, and show them

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Speaker 1: physically that the future is now. We can do this. Now,

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Speaker 1: you can drive an electric car day to day across

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Speaker 1: the country whatever you wish. So where did you begin?

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Speaker 1: Let's let's trace your path. And you were tweeting this

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Speaker 1: out as you were traveling. What what did you Where

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Speaker 1: did you launch from? We started in Toronto, Canada, at

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Speaker 1: a major conference. It was one of the focused points

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Speaker 1: there where people would come and I had all the

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Speaker 1: sort of decoration on the car and I told them

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Speaker 1: what I'm going to be doing. And I drove to

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Speaker 1: Boston with a very skeptical German journalist, I will add,

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Speaker 1: someone who did not believe this would be so comfortable.

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Speaker 1: And I went from Boston all the way down to Pennsylol, Florida,

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Speaker 1: Toronto to Boston. How long did that leg take? It's

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Speaker 1: six hundred miles, just under six or miles. It took

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Speaker 1: me ten hours drive drive a couple of hours. How

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Speaker 1: how let's say you drive two miles about the range

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Speaker 1: of a Tesla to fifty Yeah, it's really getting between

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Speaker 1: the superchargers if you're doing cross country travel, so and

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Speaker 1: they're about between a hundred and fifty twitter and fifty

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Speaker 1: miles apart all the superchargers connecting all the major cities

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Speaker 1: today today today, already there. So you were able to

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Speaker 1: go from Toronto to Boston. So you drove two miles

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Speaker 1: to the first Buffalo. How long did it take charge

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Speaker 1: it up to go to the next charger. The computer

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Speaker 1: tells you how much time you need to get to

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Speaker 1: the next supercharger with a cushion meaning you have extreme

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Speaker 1: air conditioning on or extreme heating on or whatever. New traffic,

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Speaker 1: it's about thirty minutes between you have lunch time, at

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Speaker 1: the time of breakfast, the time of coffee. Some cities

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Speaker 1: it's only fifteen minutes because sometimes they're they're sandwich maybe

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Speaker 1: hundred hundred Toronto, Buffalo and from Buffalo, that's a whole

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Speaker 1: to Boston from Buffalo, isn't it? You go and do we? Yeah,

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Speaker 1: you do? You do Albany and just at the Rochester

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Speaker 1: and uh into So so it's a day from Toronto

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Speaker 1: to Boston. Well, let's reverse engineer. Because of the German

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Speaker 1: journalist he I said, we're gonna stop when you're when

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Speaker 1: you need to use the restroom, when you're hungry, and

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Speaker 1: by the time we got to Boston, we were not

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Speaker 1: fifteen minutes inconvenience because you have to stop. You have

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Speaker 1: to stop, and you got to stop into a restroom.

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Speaker 1: So now this is curated. The computer tells us where

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Speaker 1: we're gonna stop, and you have a p of chang

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Speaker 1: there you have. You know exactly what you're gonna do.

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Speaker 1: There's no curious where you get off the freeway. Oh,

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Speaker 1: or eating at you know this fast food joiner, that

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Speaker 1: fast food joint. You kind of know exactly what you're

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Speaker 1: up against when you get there. He was shocked from

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Speaker 1: a German perspective, which there may be a little bit

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Speaker 1: more skeptical, although they're huge consumers of of alternates, like

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Speaker 1: wind is all you fly into Germany, half the country

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Speaker 1: looks like it's covered in wind farms. All right, So Boston,

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Speaker 1: I actually met you when you went from Boston to

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Speaker 1: Now normally that's a good day and a half drive.

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Speaker 1: How long does it take you to get from New

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Speaker 1: York to Florida. Well, we took the slow route. I

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Speaker 1: stopped in all the cities. I was doing book events

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Speaker 1: about two days per city, so I would come in,

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Speaker 1: I would the car would be charged before I came

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Speaker 1: into the city. I have enough range forty miles to

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Speaker 1: do all my nonsense around the city. Of course, when

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Speaker 1: I'm sleeping, the car's charging. More and more hotels and

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Speaker 1: businesses are now catering to people to have these with

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Speaker 1: the destination chargers, not the super fast ones, but the

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Speaker 1: ones that charge it around over forty You get each

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Speaker 1: hour in your park, you get about exactly and you

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Speaker 1: move on. And this is I liken this to the

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Speaker 1: charging network system. We can get into some other things

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Speaker 1: that are happening in the with the incumbents. But it's

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Speaker 1: really like the Model T was perfected on the assembly

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Speaker 1: line and started rolling out in October of nine eight,

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Speaker 1: So it's really like before there was a network of

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Speaker 1: guests exactly. So we're and we can do things a

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Speaker 1: lot faster today, and there's an army of people that

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Speaker 1: will and are doing this. It's not one company, it's

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Speaker 1: not just Tesla anymore. By the way, did Tesla have

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Speaker 1: anything to do with your trip or were they just

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Speaker 1: a lucky beneficiary of your idea? Yeah, I know the

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Speaker 1: We did not ask for permission with Tesla. I bought

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Speaker 1: the car. I sent Ellen my book, which the title

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Speaker 1: may shock people, but of course the character the doctor

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Speaker 1: in the book buys a Tesla and adopts the Tesla

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Speaker 1: way of life and what they're now doing with merging

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Speaker 1: or attempting to merge solar city in Tesla, calling it

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Speaker 1: the Tesla lifestyle. A year and a half ago, I

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Speaker 1: was already saying that my book, that this is the future.

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Speaker 1: People want the package. They want that package where they

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Speaker 1: want to be completely independent from grid, from fossil fuels,

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Speaker 1: call it what you will in their homes for all

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Speaker 1: their transportation energy. And I'm gonna push back on that

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Speaker 1: independence claim and that green claim and a little bit sure.

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Speaker 1: But you ended up at the Tesla factory, right, is

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Speaker 1: that way you finished? Yeah? I ended up on me

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Speaker 1: fourth and one of the I believe founders and directors

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Speaker 1: of Tesla, Ira, Aaron Price, was having his Global Energy

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Speaker 1: conference that day. Was that part of the plan or

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Speaker 1: just a lucky claim? It was kind of a lucky coincidence.

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Speaker 1: So I got my factory tour in the day of

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Speaker 1: the conference, you know, parked my car right there. And

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Speaker 1: it was really a day of modern energy where a

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Speaker 1: lot of these people, a lot of these thoughtly ters

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Speaker 1: were together, and I got my tour of the of

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Speaker 1: the Tesla factory on that day, and it was it was,

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Speaker 1: It was incredible. It's a there's a tectonic shift going on.

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Speaker 1: And until you've you know, really understood this from all angles,

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Speaker 1: how we create service by sell you know cars in general,

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Speaker 1: make the parts feed into it. Yeah, the world is

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Speaker 1: going through a tectonic shift, in my opinion. How many

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Speaker 1: cities did you work your way through? All told, it

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Speaker 1: was twenty five official cities, but I stopped in probably

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Speaker 1: a hundred when you when you count in the lesser towns,

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Speaker 1: and I stopped in a lot of universities, wanted to

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Speaker 1: talk to students and just just park the car. And

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Speaker 1: it's a talking point. What was the network of of

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Speaker 1: charging stations? Like? Did you ever find yourself? How does

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Speaker 1: the car find it? Do you ever find yourself? Do

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Speaker 1: you where am I going to find one of these things?

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Speaker 1: What's that network? Like? Yeah, it's it's comprehensive already, which

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Speaker 1: is actually quite shocking the fact that they only started

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Speaker 1: a few years ago. You tell the computer what two

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Speaker 1: cities you want to connect, and it says exactly where

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Speaker 1: you need to charge and how long. So it's kind

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Speaker 1: of a coup what Tesla has done already. And so

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Speaker 1: that's the city interconnection, the superchargers. His secret sounds like

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Speaker 1: it's the software as well as the network for sure,

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Speaker 1: the GPS. And then you have the destination chargers, which

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Speaker 1: are going to be installed by the millions by people

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Speaker 1: that own businesses. So they're gonna pay Elon Musk cash

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Speaker 1: money for this destination charger, which an electrician can install

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Speaker 1: in three or four or five hours, which means you

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Speaker 1: can connect any lifestyle point lifestyle point A to lifestyle

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Speaker 1: point B in any city, which means they've solved the puzzle.

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Speaker 1: I'm Barry Ridlts. You're listening to Masters in Business on

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Speaker 1: Bloomberg Radio. My guest this week is Gianni Kovia Sevic.

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Speaker 1: He is a investor, entrepreneur, environmentalist, and author of the

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Speaker 1: book My Electrician Drives a Porsche. Uh. Let's talk a

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Speaker 1: little bit about realistic environmentalism. What does it mean to

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Speaker 1: be a realistic environmentalist. A listic environmentalist is someone who

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Speaker 1: is pragmatic I would call I would call them an

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Speaker 1: algebra ist. Algebra is so if we're looking at the

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Speaker 1: challenges that are surrounding energy around the world, where if

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Speaker 1: people want to make changes with the way we create, transfer,

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Speaker 1: and utilize energy, that's fine. You want to make policy,

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Speaker 1: that's also fine. You want to create that investment vehicles,

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Speaker 1: that's great, But you have to look at the other

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Speaker 1: side of the equation, because when you take fossil fuels

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Speaker 1: out of that equation, there has to be something on

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Speaker 1: the other side. You can't just wave your hand around

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Speaker 1: and say, let's not use oil anymore. Let's no, no

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Speaker 1: more coal. So if you understand that a realistic environmentalist

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Speaker 1: is someone who looks at all the variables and he's

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Speaker 1: in the middle. He's neutral, he's a solutionist, or she

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Speaker 1: is a solutionist. So I want to understand support invest

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Speaker 1: in all the elements that factually make that possible. We

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Speaker 1: can call a reduction and CEO two emissions, green gas emissions,

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Speaker 1: whatever it is, and that is a very large arena

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Speaker 1: on on the products, materials, building blocks that factually make

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Speaker 1: a reduction in CEO two emissions possible. So so let's

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Speaker 1: talk a little bit about vehicles like the Tesla um As.

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Speaker 1: As a person who enjoys cars, likes horsepower, is not

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Speaker 1: afraid of internal combustion engines. I always have two issues

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Speaker 1: with with in general, the prius Is and Teslas of

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Speaker 1: the world. And by the way, I love the Tesla.

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Speaker 1: I think it's a beautiful car, really well made, tremendous design.

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Speaker 1: But here are the two issues I have. First, depending

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Speaker 1: on the part of the country you're in, you're charging

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Speaker 1: off the electric grid, and very often that is coal

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Speaker 1: fired electricity, which means you're not spewing junk out of

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Speaker 1: your tailpipe, but you are spewing junk out of the

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Speaker 1: source of the electricity. So why not have you respond

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Speaker 1: to that before I go onto the second one. Yeah,

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Speaker 1: that's an important question, and I liken that too. We

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Speaker 1: don't live in static Ville. Society lives in a place

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Speaker 1: called progress Ville. In two thousand seven, two around of

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Speaker 1: America's primary electricity was generated by coal. Just in the

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Speaker 1: past year, natural gas has surpassed coal as the primary

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Speaker 1: fuel source. So coal is now around thirty and falling

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Speaker 1: by it will be twenty of America's primary electricity. So

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Speaker 1: already it is the minority fuel source natural gas and

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Speaker 1: the others nuclear renewables. What have you are around se

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Speaker 1: America's fuel source and falling. So eventually this will continue

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Speaker 1: to fall. And remember, we're not going to go away

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Speaker 1: from coal because of policy, assets that are deemed on

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Speaker 1: economic or assets that are stranded. We have so much

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Speaker 1: natural gas, massive supply, lots of structure cleaner. And here's

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Speaker 1: the thing that everybody forgets. You run a pipeline to

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Speaker 1: an electrical generation plans and that's it. You're done. There's

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Speaker 1: no trucking, ship ing, there's no think about what it

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Speaker 1: takes to move all that coal by rail by whatever

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Speaker 1: means that's got to be really expensive. That gas is

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Speaker 1: clearly going to be the winner in the electrical generation

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Speaker 1: UM universe, at least for the foreseeable future. And we

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Speaker 1: see that the data recently showed that more people work

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Speaker 1: in solar today than working coal in the United States.

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Speaker 1: That's an amazing stat The second UM criticism I've heard,

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Speaker 1: and I don't know how accurate this is, UH, is

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Speaker 1: that when you look at things like the lithium batteries

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Speaker 1: and all the rare earth metals and unique elements that

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Speaker 1: go into making a car like a Prius or a Tesla. Uh,

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Speaker 1: there's a lot of really if you go all the

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Speaker 1: way upstream in the manufacturing process. There's a lot of

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Speaker 1: really bad manufacturing steps that take place to you know,

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Speaker 1: strip mind and get access this This is from not

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Speaker 1: necessarily very accessible parts of the world. How do how

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Speaker 1: do we respond to to that criticism that hey, this

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Speaker 1: creates as much heavy metal pollution as it saves in carbon. Well,

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Speaker 1: the real math and if you look at the UM

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Speaker 1: the Society of Concerned Scientists, they basically say that the

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Speaker 1: breakthrough or the break even is about nineteen thousand miles,

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Speaker 1: So it is true to create a full electric car,

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Speaker 1: there is some there's a little bit extra CEO two

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Speaker 1: emissions to create the car. According to their math, at

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Speaker 1: the nineteen thousand mile point, it's it's break even, but

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Speaker 1: eighteen months into it more or less something like that.

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Speaker 1: But it's it goes deeper than this because nothing comes

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Speaker 1: for Freeberry, nothing comes for free. People have to make

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Speaker 1: a choice. And that's what it might have of being

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Speaker 1: a realistic environmentalists. Just tell me what you like. You know,

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Speaker 1: what's the policy, what what's the will of the people? Where,

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Speaker 1: where's what's government want? Where where are the investors? Where's

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Speaker 1: the propensity to make this stuff possible? Because nothing comes

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Speaker 1: for free. If you want coal fired electricity, if you

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Speaker 1: want to use gasoline, if you want to keep searching

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Speaker 1: for fossil fuels, move it, refine it, move it again,

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Speaker 1: transport it, sell it, repeat every week. Okay, but that's

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Speaker 1: I don't believe that's where progress spell is. We are

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Speaker 1: going to go on the long course of time because

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Speaker 1: it's it's the future. It's just the smart way to

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Speaker 1: do it. And we should stop focusing on the cars

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Speaker 1: that you drive thirty minutes a day. The cars we

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Speaker 1: need to electrify are the taxis, the FedEx vehicles, the

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Speaker 1: urban buses. We can make them electric and we know

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Speaker 1: that because the world's largest automobile market has accelerated those

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Speaker 1: programs to electrify urban transport. Those are the cars that China.

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Speaker 1: We're talking China. I'm Barry Ridholtz. You're listening to Masters

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Speaker 1: in Business on Bloomberg Radio. My guest today is giannikov Sevic.

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Speaker 1: He's the author of My Electrician Drives a Porsche Investing

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Speaker 1: in the Rise of the New spending class. I was

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Speaker 1: surprised that the book was really more of a parable

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Speaker 1: then your standard nonfiction book. So let's let's start out

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Speaker 1: with the basic premise of that that parable um uh,

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Speaker 1: tell me about Doc Anderson and and who he represents.

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Speaker 1: By the way, which character in the book are you?

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Speaker 1: I would be the electrician that was my guest. So

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Speaker 1: a young electrician goes to his doctor and tell tell

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Speaker 1: the story. It takes place in Seattle. So this world

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Speaker 1: capital of sort of technology, and computers are one of them.

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Speaker 1: And the there's a fifty eight year old doctor, a

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Speaker 1: baby boomer, so I wanted to have that that demographic represented,

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Speaker 1: and a millennial gen x if you will, electrician And

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Speaker 1: he's helping his doctor renovator on a Saturday, and he

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Speaker 1: just asks the doctor, how do you baby boomers think?

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Speaker 1: How do you invest? What are you following? He leaves,

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Speaker 1: The doctor goes outside and his neighbor says, who's that

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Speaker 1: my electrician. The neighbor says, your electrician drives a Porsche.

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Speaker 1: The doctor goes out of his mind. How is this possible?

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Speaker 1: How is this possible? How can this young working class fellow,

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Speaker 1: you know, spend so much money on a lavish gift

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Speaker 1: like that? Comes back next Saturday he says, well, I

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Speaker 1: stop working as electrician about ten years ago. But because

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Speaker 1: of all the building blocks I learned and the trends

427
00:23:02,800 --> 00:23:07,040
Speaker 1: I followed. I am now an investor full time. I

428
00:23:07,119 --> 00:23:10,159
Speaker 1: take it seriously and he he reads these things like

429
00:23:10,240 --> 00:23:13,639
Speaker 1: a financial soap opera daily weekly, He goes to conferences,

430
00:23:13,680 --> 00:23:18,200
Speaker 1: he meets with people. He wants to be a contrarian investor,

431
00:23:18,440 --> 00:23:22,080
Speaker 1: so he is searching for page sixteen stories which will

432
00:23:22,160 --> 00:23:25,960
Speaker 1: become page one. And of course with the subtitle investing

433
00:23:26,000 --> 00:23:28,119
Speaker 1: in the Rise of the New spending Class, they go

434
00:23:28,240 --> 00:23:32,439
Speaker 1: and explore this army of new consumers, people that are

435
00:23:32,480 --> 00:23:35,639
Speaker 1: not rich, they're no longer emerging, they're not poor, and

436
00:23:36,119 --> 00:23:39,760
Speaker 1: all the implications of how they're changing the world and

437
00:23:39,840 --> 00:23:42,480
Speaker 1: the opportunity that they represent. So one of the things

438
00:23:42,560 --> 00:23:48,040
Speaker 1: you discuss is investing in human aspiration. Explain that what

439
00:23:48,240 --> 00:23:50,800
Speaker 1: that is first, and then how can we invest in

440
00:23:50,880 --> 00:23:55,119
Speaker 1: human aspiration? We often forget, you know, what it's like

441
00:23:55,320 --> 00:23:59,119
Speaker 1: to have, you know, salary escalation. I I come from Vancouver, Canada,

442
00:23:59,160 --> 00:24:01,440
Speaker 1: and I think it's pretty much the same around North America.

443
00:24:02,000 --> 00:24:05,280
Speaker 1: You have not had more spending power and probably thirty years.

444
00:24:05,760 --> 00:24:07,200
Speaker 1: You know, yeah, your salary might have went up a

445
00:24:07,240 --> 00:24:10,000
Speaker 1: little bit, but you factor in ocalation. You know, you're

446
00:24:10,040 --> 00:24:12,280
Speaker 1: not making a lot of money. When my parents came

447
00:24:12,320 --> 00:24:15,600
Speaker 1: from Croatian nineteen seventy three. You know that was a

448
00:24:15,720 --> 00:24:19,120
Speaker 1: very special time. You had rampant salary escalation. I remember

449
00:24:19,560 --> 00:24:22,040
Speaker 1: seeing these pace slips of my dad nineteen eighty eighty one.

450
00:24:22,080 --> 00:24:23,840
Speaker 1: He was working in north of Canada. He was making

451
00:24:23,880 --> 00:24:26,440
Speaker 1: a thousand dollars a week. Back then, Mary, you could

452
00:24:26,480 --> 00:24:28,879
Speaker 1: buy two Catollact cars every year. You could buy a

453
00:24:28,920 --> 00:24:32,960
Speaker 1: house for cash money. You cannot do that anymore. People

454
00:24:33,000 --> 00:24:37,240
Speaker 1: in emerging markets have had rampant salary escalation. Okay again,

455
00:24:37,280 --> 00:24:39,639
Speaker 1: I'm not I can I can concede they're not wealthy.

456
00:24:40,040 --> 00:24:42,320
Speaker 1: But someone in China thirty years ago, twenty five years

457
00:24:42,359 --> 00:24:43,920
Speaker 1: ago might have made two or three thousand U S

458
00:24:43,960 --> 00:24:46,399
Speaker 1: dollars a year. Well, the averages now in the eastern

459
00:24:46,440 --> 00:24:50,040
Speaker 1: provinces I speak of Shanghai, Tianjin, Beijing, they're making eighteen

460
00:24:50,080 --> 00:24:52,600
Speaker 1: twenty thousand dollars a year on average today. That's a

461
00:24:52,760 --> 00:24:55,560
Speaker 1: huge uptick from where they were. Absolutely, so what does

462
00:24:55,600 --> 00:24:57,520
Speaker 1: that mean. That means they watch television every day, they

463
00:24:57,560 --> 00:25:00,880
Speaker 1: have air conditioning, they drive a car, They have almost

464
00:25:01,040 --> 00:25:04,240
Speaker 1: the same economic footprint you and I have. They have

465
00:25:04,320 --> 00:25:09,840
Speaker 1: a deluxe diet and so that's coming with ramifications. Now

466
00:25:09,920 --> 00:25:13,440
Speaker 1: with within that is tremendous opportunity and it always comes

467
00:25:13,480 --> 00:25:18,280
Speaker 1: back to probably one primary thing energy, the insatiable appetite

468
00:25:18,760 --> 00:25:21,639
Speaker 1: for that energy. So we need to understand as investors,

469
00:25:22,000 --> 00:25:26,280
Speaker 1: particularly because of this, you know, propensity to have climate change,

470
00:25:26,480 --> 00:25:29,280
Speaker 1: how we create, transfer and utilize what I call energy.

471
00:25:29,680 --> 00:25:33,200
Speaker 1: So let me digress a little bit. Solar has is

472
00:25:33,400 --> 00:25:39,159
Speaker 1: theoretically a source of infinite energy. How comes solar as

473
00:25:39,200 --> 00:25:42,399
Speaker 1: a technology has never had that breakthrough that allowed it

474
00:25:42,480 --> 00:25:47,520
Speaker 1: to be ubiquitous, practically free, or certainly really cheap. That

475
00:25:47,760 --> 00:25:52,119
Speaker 1: that that's something that I've always found perplexing. Yeah, because

476
00:25:52,200 --> 00:25:56,800
Speaker 1: it's technology, and it doubles microtrip for example double devery

477
00:25:56,840 --> 00:26:00,280
Speaker 1: eighteen months. For decades, the learning curve on solar has

478
00:26:00,359 --> 00:26:04,040
Speaker 1: had seven doublings in fifteen years. We are now at

479
00:26:04,040 --> 00:26:09,479
Speaker 1: a point where it is commercially viable. Solar works at night.

480
00:26:09,600 --> 00:26:12,320
Speaker 1: We capture thermal heat through with fluid. That means when

481
00:26:12,359 --> 00:26:14,240
Speaker 1: the sun goes down, it works at night. We are

482
00:26:14,480 --> 00:26:16,600
Speaker 1: now able and you're gonna see this. This is gonna

483
00:26:16,600 --> 00:26:18,560
Speaker 1: bag going through a tectonic shift, by the way and energy,

484
00:26:18,560 --> 00:26:20,040
Speaker 1: and you'll take a while to articulate that. We don't

485
00:26:20,040 --> 00:26:22,440
Speaker 1: have the time right now. But you the way we

486
00:26:22,600 --> 00:26:25,240
Speaker 1: desolinate water typically in the Middle East and the places

487
00:26:25,280 --> 00:26:30,119
Speaker 1: around the equator, and they used they used fossil fuels

488
00:26:30,160 --> 00:26:31,760
Speaker 1: to do that. It takes a lot of pressure or

489
00:26:31,800 --> 00:26:34,560
Speaker 1: a lot of heat. Well, guess what my friends in

490
00:26:34,840 --> 00:26:36,960
Speaker 1: Germany are working on processes now where you do it

491
00:26:37,040 --> 00:26:41,080
Speaker 1: with solar power. It has arrived. It is commercially viable.

492
00:26:41,600 --> 00:26:44,159
Speaker 1: It is now a line item including wind. Wind has

493
00:26:44,160 --> 00:26:46,879
Speaker 1: had in the past fifteen years, four doublings. So we

494
00:26:47,080 --> 00:26:48,800
Speaker 1: when you when you look at this and you see

495
00:26:48,840 --> 00:26:50,800
Speaker 1: how the changes, I mean, where's the big investment happened

496
00:26:50,800 --> 00:26:53,120
Speaker 1: in the past twenty four months. Not in fossil fuel

497
00:26:53,119 --> 00:26:56,080
Speaker 1: electricity generation, it's all been on the lion's share is

498
00:26:56,119 --> 00:26:59,320
Speaker 1: now going into into these renewables across the board. And

499
00:26:59,440 --> 00:27:02,600
Speaker 1: because there's this army of people working on this, the

500
00:27:02,680 --> 00:27:05,760
Speaker 1: prize is so big. Then we get into the energy

501
00:27:05,840 --> 00:27:08,760
Speaker 1: storage and on and on. It's it's we're going through

502
00:27:09,320 --> 00:27:13,480
Speaker 1: probably a once in a multi generational tectonic shift on

503
00:27:13,560 --> 00:27:16,600
Speaker 1: how we create energy, which is going to impact that

504
00:27:16,680 --> 00:27:19,679
Speaker 1: we transfer energy, cause there's only three ways to do that. Pipelines,

505
00:27:19,920 --> 00:27:23,440
Speaker 1: railroads and ships and electricity, cables or micro grid. Well,

506
00:27:23,480 --> 00:27:25,639
Speaker 1: the future of energy transfer is going to be with electricity,

507
00:27:25,800 --> 00:27:27,840
Speaker 1: not with the not with the incumbents, and then the

508
00:27:27,880 --> 00:27:29,920
Speaker 1: way we utilize it. We're not going to be using

509
00:27:29,960 --> 00:27:32,760
Speaker 1: fossil fuels to utilize energy. When you look at that,

510
00:27:33,160 --> 00:27:37,000
Speaker 1: I always tell people oil is energy. Energy without fossil

511
00:27:37,080 --> 00:27:42,879
Speaker 1: fuels is electricity, and electricity demands what we want to

512
00:27:42,960 --> 00:27:45,000
Speaker 1: invest in those things. We want to invest in engineering.

513
00:27:45,040 --> 00:27:47,000
Speaker 1: We want to invest in in the in the in

514
00:27:47,040 --> 00:27:50,800
Speaker 1: the technique, the techniques, the design, the building blocks, and

515
00:27:50,880 --> 00:27:53,840
Speaker 1: across the board. So so let's talk about something that

516
00:27:54,280 --> 00:27:56,280
Speaker 1: a theme that comes up over and over again in

517
00:27:56,359 --> 00:28:01,880
Speaker 1: the book China Copper. People, you're you're alluding to copper.

518
00:28:02,400 --> 00:28:05,600
Speaker 1: Tell us about copper and why is it the green metal.

519
00:28:06,440 --> 00:28:11,480
Speaker 1: There are four major energy commodities. You've got coal, natural gas,

520
00:28:11,760 --> 00:28:14,760
Speaker 1: and oil. The fourth one is copper. It's always been

521
00:28:14,800 --> 00:28:17,720
Speaker 1: relevant in the future. And I'm going to suggest something

522
00:28:17,840 --> 00:28:20,119
Speaker 1: very strong. I don't believe in my opinion, that we

523
00:28:20,240 --> 00:28:25,040
Speaker 1: are ever going to have another twenty five or increase

524
00:28:25,119 --> 00:28:28,200
Speaker 1: in demand for oil. We are now at a point

525
00:28:28,280 --> 00:28:30,480
Speaker 1: we have to start talking about terminal decline. Coal is

526
00:28:30,480 --> 00:28:32,320
Speaker 1: already finished that in core is already on. It's a

527
00:28:32,359 --> 00:28:37,200
Speaker 1: twilight industry. Innovation adoption technology are not the friends of

528
00:28:37,240 --> 00:28:40,400
Speaker 1: the oil industry. You innovate, use less oil, you adopt

529
00:28:40,480 --> 00:28:43,160
Speaker 1: use no oil technology. The way we extract oil is

530
00:28:43,200 --> 00:28:46,160
Speaker 1: a game changer. When you look at the fourth commodity,

531
00:28:46,200 --> 00:28:50,680
Speaker 1: the energy commodity copper, there is conclusively going to be

532
00:28:51,000 --> 00:28:56,400
Speaker 1: thirty new customer base when you create and utilize greener

533
00:28:56,440 --> 00:29:00,280
Speaker 1: and cleaner energy Barry. It takes five more cop in

534
00:29:00,360 --> 00:29:03,280
Speaker 1: the case of offshore wind, a thousand percent more copper,

535
00:29:04,280 --> 00:29:06,920
Speaker 1: and there's been no fracking moment for the copper industry.

536
00:29:06,960 --> 00:29:10,240
Speaker 1: The way we extract copper. No one's building copper minds.

537
00:29:11,000 --> 00:29:13,400
Speaker 1: So we have to choose putting on our algebra hat again,

538
00:29:13,600 --> 00:29:15,720
Speaker 1: if we're gonna take away fossil fuels, we have to

539
00:29:15,800 --> 00:29:20,400
Speaker 1: recognize and appreciate the science in this equation. It takes

540
00:29:20,520 --> 00:29:25,280
Speaker 1: copper to make green energy possible, not by four hundred

541
00:29:25,880 --> 00:29:29,560
Speaker 1: power of magnitude. So I think that when you look

542
00:29:29,600 --> 00:29:32,080
Speaker 1: at the winners and losers, people want to follow and

543
00:29:32,240 --> 00:29:34,840
Speaker 1: understand the copper industry, not for the next three months

544
00:29:34,920 --> 00:29:37,760
Speaker 1: or six months. Because traditionally copper has been tethered to

545
00:29:37,760 --> 00:29:39,920
Speaker 1: the price of oil. But we go forward the next

546
00:29:39,960 --> 00:29:42,880
Speaker 1: to five, seven, ten years, things are going to change

547
00:29:42,920 --> 00:29:45,960
Speaker 1: tectonic shift. So let's talk a little bit about copper

548
00:29:46,120 --> 00:29:50,640
Speaker 1: usages and how the technology surrounding its extraction might change. Obviously,

549
00:29:51,320 --> 00:29:55,280
Speaker 1: anything electric is using copper wiring. I don't even think

550
00:29:55,320 --> 00:29:58,360
Speaker 1: we're allowed to use aluminum wiring in homes anymore. That

551
00:29:58,520 --> 00:30:02,080
Speaker 1: used to be an alternati, a cheaper alternative. Um, what

552
00:30:02,360 --> 00:30:07,440
Speaker 1: is the main application of copper in the the energy grid?

553
00:30:08,040 --> 00:30:10,000
Speaker 1: It's a good question, and were always got to be careful.

554
00:30:10,040 --> 00:30:12,400
Speaker 1: I mean I I read this stuff like Harlequin Romance Berry,

555
00:30:12,520 --> 00:30:14,480
Speaker 1: so you know other people don't. So let me try

556
00:30:14,520 --> 00:30:17,000
Speaker 1: to make this more interesting for people that know nothing

557
00:30:17,040 --> 00:30:20,640
Speaker 1: about this stuff. They experts will tell you that if

558
00:30:20,720 --> 00:30:24,840
Speaker 1: we adopt high efficiency energy systems, we can reduce CEO

559
00:30:24,920 --> 00:30:27,560
Speaker 1: two emissions by one point to five giga tons. So

560
00:30:27,640 --> 00:30:30,520
Speaker 1: if I translate that, that's like taking five million cars

561
00:30:30,600 --> 00:30:33,600
Speaker 1: off the road. So what is a high efficiency energy system? Well,

562
00:30:33,640 --> 00:30:38,880
Speaker 1: you make motors more efficient. Of America's electricity is consumed

563
00:30:39,160 --> 00:30:42,240
Speaker 1: by motors from the smallest to the biggest, meaning anything

564
00:30:42,320 --> 00:30:45,720
Speaker 1: from a vacuum cleaner, air conditioning across the elevators across

565
00:30:45,760 --> 00:30:49,200
Speaker 1: the board. You know, motors use the bulk of the electricity,

566
00:30:49,480 --> 00:30:51,480
Speaker 1: so you make them more modern, more efficient by using

567
00:30:51,520 --> 00:30:54,560
Speaker 1: a copper rotor transformers. You don't use aluminum windings, you

568
00:30:54,640 --> 00:30:58,160
Speaker 1: use copper windings. There is across society where if we

569
00:30:58,240 --> 00:31:03,440
Speaker 1: increase we increase the amplitude of copper, you reduce electricity consumption,

570
00:31:03,480 --> 00:31:06,320
Speaker 1: which means you need to generate less electricity. It's true

571
00:31:06,360 --> 00:31:08,320
Speaker 1: that aluminium as a substitute in many cases, and it

572
00:31:08,560 --> 00:31:10,640
Speaker 1: will continue to be part of the solution. You know,

573
00:31:10,760 --> 00:31:12,720
Speaker 1: copper will not be the be all end all, but

574
00:31:12,840 --> 00:31:16,240
Speaker 1: we will for efficiency use more copper. We talk about

575
00:31:16,240 --> 00:31:17,960
Speaker 1: a wind park because now if you're going to build

576
00:31:17,960 --> 00:31:20,920
Speaker 1: a two hundred megawatt power plant, which is a small

577
00:31:20,960 --> 00:31:22,840
Speaker 1: coal fired plant, or you say, you know what, let's

578
00:31:22,880 --> 00:31:25,640
Speaker 1: do a two hundred megawatt wind farm. My friend Rossbaty

579
00:31:25,760 --> 00:31:28,800
Speaker 1: just installed a two hundred megawatt project in Shannon, Texas.

580
00:31:29,840 --> 00:31:32,520
Speaker 1: You need sixty five you know, three and a half

581
00:31:32,600 --> 00:31:36,040
Speaker 1: megawatt wind turbines each head. It's a generator, is what

582
00:31:36,120 --> 00:31:38,960
Speaker 1: it is. Has almost two thousand pounds of copper. The

583
00:31:39,040 --> 00:31:41,680
Speaker 1: step up transformer you need to collect all that power

584
00:31:41,760 --> 00:31:45,720
Speaker 1: to one central location and then send it off, send

585
00:31:45,800 --> 00:31:47,440
Speaker 1: it off to the grid. You also have to arrest

586
00:31:47,520 --> 00:31:51,960
Speaker 1: the lightning. You know, it's very deluxe, very expensive, you know,

587
00:31:52,360 --> 00:31:55,960
Speaker 1: from a copper perspective, electricity to build. But once it's done,

588
00:31:56,600 --> 00:31:59,440
Speaker 1: you've got energy now for ten twenty thirty years. Now

589
00:31:59,640 --> 00:32:02,280
Speaker 1: we will address other things like curtailment, which means getting

590
00:32:02,280 --> 00:32:03,920
Speaker 1: the power out to people that are using it and

591
00:32:04,000 --> 00:32:07,760
Speaker 1: what have you. But this is early early days and

592
00:32:07,880 --> 00:32:09,600
Speaker 1: it's only going to get more and more as as

593
00:32:09,600 --> 00:32:12,280
Speaker 1: a percentage of power generation. So, Gianni, if people want

594
00:32:12,320 --> 00:32:14,520
Speaker 1: to find your writings, where's the best place for them

595
00:32:14,600 --> 00:32:18,200
Speaker 1: to to look to learn more about this? Well, my

596
00:32:18,280 --> 00:32:20,360
Speaker 1: book is it's all at all the US airports and

597
00:32:20,400 --> 00:32:22,880
Speaker 1: people can find find it on Amazon pretty easily. And

598
00:32:23,000 --> 00:32:25,320
Speaker 1: I Twitter once in a while, I think I go

599
00:32:25,440 --> 00:32:28,040
Speaker 1: through periods of being more or less busy. But my

600
00:32:28,120 --> 00:32:32,200
Speaker 1: Twitter handle is at realistic in viral, and then people

601
00:32:32,240 --> 00:32:35,520
Speaker 1: can also source that to my personal website, which is

602
00:32:36,440 --> 00:32:41,880
Speaker 1: Realistic Environmentalist dot com. If you enjoy these conversations, be

603
00:32:42,040 --> 00:32:45,200
Speaker 1: sure and check out our podcast extras where we continue

604
00:32:45,280 --> 00:32:49,240
Speaker 1: the conversation. Check out my daily column on Bloomberg dot

605
00:32:49,280 --> 00:32:52,760
Speaker 1: com or follow me on Twitter at Rid Halts. I'm

606
00:32:52,840 --> 00:32:55,880
Speaker 1: Barry Rit Halts. You've been listening to Masters in Business

607
00:32:56,120 --> 00:32:59,640
Speaker 1: on Bloomberg Radio, brought to you by b A SF

608
00:33:00,080 --> 00:33:04,000
Speaker 1: we create Chemistry. Welcome back to the podcast portion of

609
00:33:04,080 --> 00:33:06,560
Speaker 1: our show. Gihnni. Thank you so much for doing this.

610
00:33:06,640 --> 00:33:09,600
Speaker 1: There's so much stuff I missed that we really have

611
00:33:09,760 --> 00:33:12,720
Speaker 1: to go back to some of our early questions and

612
00:33:13,040 --> 00:33:15,080
Speaker 1: uh and and plow through it before I get to

613
00:33:15,240 --> 00:33:19,560
Speaker 1: my favorite questions. Um and and we'll also talk cars

614
00:33:19,600 --> 00:33:24,240
Speaker 1: a little bit. Um. It's funny. Your electrician drives a Porsche.

615
00:33:24,440 --> 00:33:28,600
Speaker 1: My butcher drives a Porsche. I was picking up some

616
00:33:28,640 --> 00:33:32,160
Speaker 1: stuff for a barbecue, and I wasn't thinking. I put

617
00:33:32,280 --> 00:33:35,040
Speaker 1: the keys down on the and I have far too

618
00:33:35,120 --> 00:33:37,720
Speaker 1: many keys and far too many cars. And he sees

619
00:33:37,760 --> 00:33:41,440
Speaker 1: the little he sees the little automobile shaped key, and

620
00:33:41,560 --> 00:33:45,160
Speaker 1: he goes, oh, well, I have the same car. Oh really,

621
00:33:45,240 --> 00:33:46,880
Speaker 1: what do you? What do you have? I have a Panamera.

622
00:33:47,200 --> 00:33:49,640
Speaker 1: I'm like, oh, that's that's interesting. I drove one up

623
00:33:49,680 --> 00:33:52,600
Speaker 1: at Monisanlo Race. Wayne. I love the car. He says,

624
00:33:52,640 --> 00:33:55,760
Speaker 1: he just couldn't stop braving it. So, your electrician drives

625
00:33:55,760 --> 00:33:58,840
Speaker 1: a Porsche. My Butcher drives a Porsche, which I think

626
00:33:59,000 --> 00:34:02,720
Speaker 1: is is pretty pretty hilarious. Um, let's talk a little

627
00:34:02,720 --> 00:34:06,600
Speaker 1: bit about Tesla. Um, you've had the car for how long?

628
00:34:08,080 --> 00:34:11,560
Speaker 1: I bought the car in December, and and what what's

629
00:34:11,600 --> 00:34:13,680
Speaker 1: your take on it? What? What do you love? What

630
00:34:13,800 --> 00:34:15,759
Speaker 1: do you what do you think they need to do better.

631
00:34:16,360 --> 00:34:18,359
Speaker 1: I've owned a lot of cars in my in my time,

632
00:34:18,440 --> 00:34:21,880
Speaker 1: and I've had multiple Porschas. I had a Ferrari three sixty,

633
00:34:21,960 --> 00:34:24,840
Speaker 1: a BMW M three, and I recently just sold my

634
00:34:25,560 --> 00:34:28,640
Speaker 1: eight l and it is the best car I've ever owned.

635
00:34:29,600 --> 00:34:32,839
Speaker 1: An that's what consumer reports said, although I will tell

636
00:34:32,960 --> 00:34:37,440
Speaker 1: you that M three is really a fun car. Different

637
00:34:37,480 --> 00:34:40,000
Speaker 1: horses for different courses, you know. So it depends on

638
00:34:40,120 --> 00:34:42,000
Speaker 1: what you're doing, you know. But if you were to

639
00:34:42,040 --> 00:34:43,960
Speaker 1: have and I asked this question, So I'm I'm off

640
00:34:44,040 --> 00:34:45,480
Speaker 1: to Europe tomorrow and I'm going to be with my

641
00:34:45,560 --> 00:34:49,040
Speaker 1: friend who lives in Monaco. He has fifteen cars, doesn't

642
00:34:49,040 --> 00:34:51,480
Speaker 1: own a Tesla. But then you have a tough question.

643
00:34:51,520 --> 00:34:53,560
Speaker 1: I said, yeah, but hold on a second. If you

644
00:34:53,840 --> 00:34:56,600
Speaker 1: could only have one car, it had to take your

645
00:34:56,640 --> 00:34:59,320
Speaker 1: kids to school, had to be fast, had to be comfortable.

646
00:34:59,400 --> 00:35:01,960
Speaker 1: I had to that look good. It's a pretty good

647
00:35:02,040 --> 00:35:04,240
Speaker 1: single car to have. I mean, it covers all the bases.

648
00:35:04,239 --> 00:35:06,200
Speaker 1: You're not gonna go hunting to Wyoming with it, but

649
00:35:06,280 --> 00:35:09,719
Speaker 1: other than that, it pretty much covers everything. I thought

650
00:35:09,760 --> 00:35:14,360
Speaker 1: when they released the ninety s D with Insanity Mode,

651
00:35:14,960 --> 00:35:18,960
Speaker 1: I thought that was a game changer because it essentially said, look,

652
00:35:19,080 --> 00:35:22,640
Speaker 1: nobody's going to be drag racing against Ferraris and Lamborghinis.

653
00:35:22,719 --> 00:35:25,440
Speaker 1: Although go to YouTube and if you could find Tesla's

654
00:35:25,480 --> 00:35:29,840
Speaker 1: beating them, um, but it basically said to me, the

655
00:35:30,000 --> 00:35:34,920
Speaker 1: technology now exists that whatever automobile application you want to

656
00:35:35,000 --> 00:35:40,680
Speaker 1: try and and use this technology towards, there's nothing this

657
00:35:40,800 --> 00:35:43,520
Speaker 1: doesn't do. This can be to Ferrari and speed, it's

658
00:35:43,560 --> 00:35:47,040
Speaker 1: comparable to an suv and in terms of comfort and

659
00:35:47,320 --> 00:35:54,080
Speaker 1: space and it that really shifted my perspective about electric

660
00:35:54,160 --> 00:35:57,560
Speaker 1: cars because it was no longer sort of a hobbyist gadget.

661
00:35:57,600 --> 00:36:00,319
Speaker 1: It's oh no, this is technology and we could tune

662
00:36:00,360 --> 00:36:03,680
Speaker 1: it to all different applications. I know they originally started

663
00:36:03,760 --> 00:36:09,960
Speaker 1: with their sort of Lotus adapted version, but that Insanity

664
00:36:10,040 --> 00:36:13,520
Speaker 1: mode made me think, well, why not skin of Tesla

665
00:36:14,200 --> 00:36:18,280
Speaker 1: with a really sexy looking body and compete with the Ferraris,

666
00:36:18,360 --> 00:36:21,280
Speaker 1: Lamborghinis and and even the four Gts of the world.

667
00:36:21,800 --> 00:36:24,520
Speaker 1: I think there's an audience for that, is that in

668
00:36:24,640 --> 00:36:26,759
Speaker 1: the future of Tesla in any way, shape or form.

669
00:36:28,480 --> 00:36:30,600
Speaker 1: They've got an offering right now which is coming out

670
00:36:30,680 --> 00:36:32,239
Speaker 1: with we all know what they have already. They go.

671
00:36:32,320 --> 00:36:36,719
Speaker 1: So they have the ninety, which is the sedan, the

672
00:36:37,320 --> 00:36:40,680
Speaker 1: AX which is the suv, which is really by the way,

673
00:36:40,719 --> 00:36:43,480
Speaker 1: the X is really interesting looking. There's someone in my

674
00:36:43,520 --> 00:36:46,960
Speaker 1: neighborhood has it. It's this sort of woody allen sleeper,

675
00:36:47,680 --> 00:36:51,480
Speaker 1: bulbous thing, but it's interesting looking. It's not like what

676
00:36:51,600 --> 00:36:54,080
Speaker 1: the hell is at it's oh, that's kind of interesting.

677
00:36:54,640 --> 00:36:59,040
Speaker 1: And of course the doors, which their core. What what

678
00:36:59,120 --> 00:37:01,960
Speaker 1: do they rename the doors? It's not the gull wing doors,

679
00:37:02,040 --> 00:37:06,680
Speaker 1: it's the or something like that. They're really an interesting

680
00:37:07,080 --> 00:37:14,399
Speaker 1: little gimmick, but it's an enormous expanse of space inside. Yeah, I'm,

681
00:37:14,440 --> 00:37:19,239
Speaker 1: I'm what they've done to rattle this industry. Let's pretend

682
00:37:19,280 --> 00:37:22,000
Speaker 1: were the incumbent automotive manufacturers for a moment, and if

683
00:37:22,000 --> 00:37:23,960
Speaker 1: you go back a few years, they do, you know, say, well,

684
00:37:24,000 --> 00:37:25,480
Speaker 1: no one's gonna want to buy these things. And then

685
00:37:25,520 --> 00:37:28,200
Speaker 1: there's no very dismissive, there's no there's no infrastructure. You know,

686
00:37:28,280 --> 00:37:30,920
Speaker 1: it'll take forever to do the infrastructure. This what was

687
00:37:31,000 --> 00:37:33,600
Speaker 1: a little company was able to build an infrastructure network

688
00:37:33,719 --> 00:37:36,400
Speaker 1: in less than three years. That's I mean, shame on you.

689
00:37:36,520 --> 00:37:38,360
Speaker 1: I say to all the incumbents, how could you be

690
00:37:38,480 --> 00:37:41,120
Speaker 1: so lazy? And now it's going to affect their businesses

691
00:37:41,840 --> 00:37:45,160
Speaker 1: now they all have been rolling out their own internal

692
00:37:45,239 --> 00:37:50,720
Speaker 1: electrical division v e v vly but carefully, because their

693
00:37:50,800 --> 00:37:54,280
Speaker 1: problem is their beholden to what is a franchise network.

694
00:37:54,760 --> 00:37:58,640
Speaker 1: It's very different space to cannibalize your own business. It's

695
00:37:58,719 --> 00:38:01,520
Speaker 1: the baby that's going to chew. They need to start

696
00:38:01,760 --> 00:38:03,840
Speaker 1: like other technology companies have done. They don't want to

697
00:38:03,840 --> 00:38:06,719
Speaker 1: become Blockbuster Video or Codac Film. We know that, and

698
00:38:07,280 --> 00:38:09,480
Speaker 1: we know people really has done a great job of

699
00:38:09,640 --> 00:38:12,319
Speaker 1: letting each new technology. You can't really buy a new

700
00:38:12,400 --> 00:38:17,040
Speaker 1: iPod anymore because the technology of the st chips. Now,

701
00:38:17,880 --> 00:38:20,600
Speaker 1: what used to be a five hundred dollar iPod with

702
00:38:20,760 --> 00:38:23,239
Speaker 1: a hundred megs of or a hundred whatever it is

703
00:38:23,280 --> 00:38:26,000
Speaker 1: gigs of storage, you can now buy a chip for

704
00:38:26,080 --> 00:38:27,800
Speaker 1: twelve dollars and you can put all that music on

705
00:38:27,840 --> 00:38:30,560
Speaker 1: a chip, and most the new cars you could just

706
00:38:30,640 --> 00:38:32,800
Speaker 1: plug in that s D and you don't need that anymore.

707
00:38:33,440 --> 00:38:35,640
Speaker 1: But up until that point, they were very good at

708
00:38:35,719 --> 00:38:40,359
Speaker 1: cannibalizing themselves. Each new version was faster, smaller, and more

709
00:38:40,440 --> 00:38:43,920
Speaker 1: storage and cheaper. The automobile companies don't think like that,

710
00:38:44,120 --> 00:38:46,840
Speaker 1: do they. There they have to put a siren on

711
00:38:46,880 --> 00:38:50,160
Speaker 1: these programs, and I believe they do a siren meaning

712
00:38:50,719 --> 00:38:53,480
Speaker 1: real quick. They don't have ten years. Because here's here's

713
00:38:53,480 --> 00:38:54,960
Speaker 1: how I see this playing out. And I follow this

714
00:38:55,040 --> 00:38:57,239
Speaker 1: for a long time, and I know some of the

715
00:38:57,280 --> 00:38:58,920
Speaker 1: companies a little bit more intimately because I know some

716
00:38:59,000 --> 00:39:02,120
Speaker 1: of the larger shareholders and such. And we've seen now

717
00:39:02,239 --> 00:39:04,680
Speaker 1: the front page story, of course is folkswagon. They've had

718
00:39:04,840 --> 00:39:06,920
Speaker 1: the so called settlement with the e P A fourteen

719
00:39:06,960 --> 00:39:10,640
Speaker 1: point seven billion dollars comes in multiple tiers, not the

720
00:39:10,719 --> 00:39:12,640
Speaker 1: least of which is a two billion dollar investment in

721
00:39:12,760 --> 00:39:15,200
Speaker 1: this infrastructure that can be used by other people. What

722
00:39:15,480 --> 00:39:20,720
Speaker 1: what is a few billion dollars amongst friends? Fifteen billion exactly?

723
00:39:20,800 --> 00:39:24,000
Speaker 1: And then these shot fines don't even shock people anymore.

724
00:39:24,520 --> 00:39:26,920
Speaker 1: But but the business is going to shock people because

725
00:39:27,000 --> 00:39:29,960
Speaker 1: what I've seen happen. Remember that the incumbents have this

726
00:39:30,320 --> 00:39:34,399
Speaker 1: franchise e system, the parts that feed into this car,

727
00:39:34,560 --> 00:39:36,720
Speaker 1: which is of course then serviced for ten or fifteen

728
00:39:36,800 --> 00:39:40,040
Speaker 1: years afterwards. The average and storm combustion engine car has

729
00:39:40,080 --> 00:39:43,400
Speaker 1: eighty parts. The average electric car has twenty. So what

730
00:39:43,520 --> 00:39:46,359
Speaker 1: have we seen happen? What keeps eking its ugly head up?

731
00:39:46,840 --> 00:39:49,640
Speaker 1: The plug in hybrid? Berry, you get a bit of

732
00:39:49,800 --> 00:39:53,279
Speaker 1: range range anxiety. People think they oh, just to comfort you.

733
00:39:54,120 --> 00:39:56,680
Speaker 1: Now you have a hundred major components in the car.

734
00:39:57,160 --> 00:40:00,040
Speaker 1: So four or five, six, seven years later to I

735
00:40:00,080 --> 00:40:02,360
Speaker 1: want to be servicing a plug in hybrid? No, thank you,

736
00:40:03,000 --> 00:40:06,080
Speaker 1: But hold on, isn't that a transitional technology? I mean,

737
00:40:06,200 --> 00:40:08,560
Speaker 1: I mean it's range anxiety, which is a fear for

738
00:40:08,600 --> 00:40:12,959
Speaker 1: the consumer. But that's temporary, which doesn't exist. I drove

739
00:40:13,000 --> 00:40:16,160
Speaker 1: across America. I have more experienced than probably you know,

740
00:40:17,160 --> 00:40:21,160
Speaker 1: almost everyone. Weekend, day, night, village, city, the city. You

741
00:40:21,280 --> 00:40:24,640
Speaker 1: don't need it, you can get anxiety. Isn't that just

742
00:40:24,800 --> 00:40:28,600
Speaker 1: a until people understand the technology, until they become familiar

743
00:40:28,680 --> 00:40:32,000
Speaker 1: with it. Look, the reality is I I drive three

744
00:40:32,080 --> 00:40:34,080
Speaker 1: miles to the train station in the morning, and I

745
00:40:34,200 --> 00:40:36,319
Speaker 1: drive not three minutes to the train station the morning,

746
00:40:36,600 --> 00:40:39,359
Speaker 1: three minutes home. On the weekend. Occasionally I go out

747
00:40:39,440 --> 00:40:42,239
Speaker 1: to the Hampton's it's seventy five miles each way, a

748
00:40:42,360 --> 00:40:46,440
Speaker 1: hundred miles each way. Occasionally I'll go upstate or I

749
00:40:46,560 --> 00:40:48,680
Speaker 1: can't remember the last time I got in the car,

750
00:40:48,760 --> 00:40:51,080
Speaker 1: and I actually can't remember, right, I hadn't had an

751
00:40:51,160 --> 00:40:54,080
Speaker 1: event up at Cornell, which I don't think is two

752
00:40:54,200 --> 00:40:57,279
Speaker 1: hundred miles from here, and if and if it is,

753
00:40:57,600 --> 00:41:00,520
Speaker 1: it's pretty close, so maybe I would to stop for

754
00:41:00,640 --> 00:41:03,719
Speaker 1: launch and charge up for a little bit. But most

755
00:41:03,800 --> 00:41:08,960
Speaker 1: people's driving the range anxiety is a artificial fear, and

756
00:41:09,040 --> 00:41:12,120
Speaker 1: it just takes a little experience and a little to

757
00:41:12,640 --> 00:41:15,600
Speaker 1: get by. That couldn't agree more, which is why, in

758
00:41:15,719 --> 00:41:19,040
Speaker 1: my opinion, the whole plug in hybrid thing, all this

759
00:41:19,160 --> 00:41:21,319
Speaker 1: engineering towards it and all this build out is going

760
00:41:21,360 --> 00:41:23,920
Speaker 1: to blow up in all their faces, is it? But

761
00:41:24,040 --> 00:41:28,920
Speaker 1: I always think these companies, like GMS original Vaults with

762
00:41:29,080 --> 00:41:32,719
Speaker 1: the plug in hybrid technology was a transitional technology, and

763
00:41:32,800 --> 00:41:36,600
Speaker 1: now their new car, the Bolt, is really the first

764
00:41:36,960 --> 00:41:40,279
Speaker 1: low cost, mass produced all electric that's gonna be out.

765
00:41:40,320 --> 00:41:43,520
Speaker 1: It's actually gonna beat the Tesla Model three to market.

766
00:41:43,560 --> 00:41:46,360
Speaker 1: It's supposed to be out this summer and reasonable thirty

767
00:41:46,400 --> 00:41:51,439
Speaker 1: something thousand dollars. That's also a game changer. But who's

768
00:41:51,440 --> 00:41:53,000
Speaker 1: gonna be Who's who are the new people in town?

769
00:41:53,160 --> 00:41:56,839
Speaker 1: The technologically advanced companies that are going to be coming

770
00:41:56,880 --> 00:41:59,560
Speaker 1: out with their own electric car. It's pretty hard for

771
00:42:00,120 --> 00:42:03,279
Speaker 1: you know, other companies to sort of um disrupt any

772
00:42:03,320 --> 00:42:06,400
Speaker 1: more technologies. So I believe the automotive industry is getting disrupted.

773
00:42:07,000 --> 00:42:09,000
Speaker 1: They're not going to make a hybrid car. They're gonna

774
00:42:09,040 --> 00:42:12,200
Speaker 1: make a believe this the most technologically advanced vehicle which

775
00:42:12,200 --> 00:42:14,120
Speaker 1: will be electric. When you get into whole rides share,

776
00:42:14,160 --> 00:42:16,160
Speaker 1: I think those cars have to be electric for purposes

777
00:42:16,200 --> 00:42:19,440
Speaker 1: of servicing. And what do you mean like the cars

778
00:42:19,520 --> 00:42:22,160
Speaker 1: that are owned by a big corporation. They might have

779
00:42:22,239 --> 00:42:24,640
Speaker 1: two thousand, three thousand all over the city and you

780
00:42:24,760 --> 00:42:28,160
Speaker 1: just rented per the minute, and that is going to

781
00:42:28,239 --> 00:42:31,279
Speaker 1: be increasingly I think more electric as as we as

782
00:42:31,320 --> 00:42:34,839
Speaker 1: we arrive. What about the Ubers of the future, Uber

783
00:42:34,880 --> 00:42:37,200
Speaker 1: the future self driving cars? I mean that that's something

784
00:42:37,239 --> 00:42:39,520
Speaker 1: that we will tackle five, t fifteen years down the road.

785
00:42:39,560 --> 00:42:43,160
Speaker 1: I think away a lot of counties, towns, cities, states

786
00:42:43,160 --> 00:42:44,600
Speaker 1: are gonna say, you know what you did it. You

787
00:42:44,719 --> 00:42:46,600
Speaker 1: still have to have a driver in the car, you know,

788
00:42:46,640 --> 00:42:49,320
Speaker 1: we just for for that. Who knows, either for jobs

789
00:42:49,400 --> 00:42:51,600
Speaker 1: or for safety, it's you're still gonna have to have

790
00:42:51,640 --> 00:42:53,960
Speaker 1: a driver. There busses and different things, I think, or

791
00:42:54,080 --> 00:42:55,840
Speaker 1: maybe a little bit different. I take the plane to

792
00:42:55,920 --> 00:42:59,560
Speaker 1: the train to go to JFK. That is a robotic tran,

793
00:42:59,760 --> 00:43:03,680
Speaker 1: a eletric tram from Jamaica to JFK Airport. There's nobody

794
00:43:03,800 --> 00:43:07,799
Speaker 1: driving those. They're fully automated. The track right on its

795
00:43:07,840 --> 00:43:10,200
Speaker 1: own track. But there's a series of them. They go

796
00:43:10,320 --> 00:43:12,759
Speaker 1: to the airport, they circle the airport, they come back.

797
00:43:13,200 --> 00:43:15,960
Speaker 1: There is six stops along the way. It's fully automated.

798
00:43:17,400 --> 00:43:22,760
Speaker 1: That looks like that's the future of transportation. The question

799
00:43:22,880 --> 00:43:30,719
Speaker 1: becomes how soon can Tesla produce a fairly self driving car? Well,

800
00:43:30,760 --> 00:43:34,040
Speaker 1: self driving is something that I just don't right now.

801
00:43:34,080 --> 00:43:35,759
Speaker 1: I'm not losing any sleep over that. It's not going

802
00:43:35,840 --> 00:43:38,320
Speaker 1: to impact me as an investor. What is more important,

803
00:43:38,400 --> 00:43:40,440
Speaker 1: I think for the general investor out there is to

804
00:43:40,600 --> 00:43:43,239
Speaker 1: understand a lot of the incumbents are going to make

805
00:43:43,280 --> 00:43:45,560
Speaker 1: a product that I liken it to forgive me Canada

806
00:43:45,719 --> 00:43:48,600
Speaker 1: a BlackBerry, they redesign it but no one buys it.

807
00:43:48,840 --> 00:43:51,360
Speaker 1: No one's gonna buy this plug in hybrid because the

808
00:43:51,520 --> 00:43:54,680
Speaker 1: offering they have by the more progressive companies is far

809
00:43:54,760 --> 00:43:57,880
Speaker 1: more as far more cool factor, far more futuristic factor

810
00:43:58,040 --> 00:44:01,960
Speaker 1: being all electric. And when you look at the if

811
00:44:02,000 --> 00:44:03,760
Speaker 1: we open the book a little bit deeper, how who's

812
00:44:03,760 --> 00:44:06,760
Speaker 1: because who's going to impact Barry the winners and losers

813
00:44:06,800 --> 00:44:09,279
Speaker 1: in this industry? Well, who wants the most real estate

814
00:44:09,320 --> 00:44:13,520
Speaker 1: with with respect to the car manufacturers? Which parts? Who

815
00:44:13,600 --> 00:44:17,160
Speaker 1: makes only mufflers? Are only radiators? On the other side,

816
00:44:17,160 --> 00:44:19,120
Speaker 1: who's going to be making this stuff that's that's more

817
00:44:19,200 --> 00:44:22,000
Speaker 1: technologically advanced? You know, people have to look at that.

818
00:44:22,040 --> 00:44:25,400
Speaker 1: If you're an investor, would be it an a dominant foundation? Whoever?

819
00:44:26,000 --> 00:44:28,560
Speaker 1: Get your analysts to really dig deep on this stuff

820
00:44:28,560 --> 00:44:31,640
Speaker 1: because it's I think this is going through a a

821
00:44:31,760 --> 00:44:33,880
Speaker 1: tectonic shift. And then of course we get to the

822
00:44:34,120 --> 00:44:36,360
Speaker 1: how do you electrify our fuel these things? Because that

823
00:44:36,440 --> 00:44:39,200
Speaker 1: also is going to have a dramatic impact with efficiencies.

824
00:44:39,440 --> 00:44:42,640
Speaker 1: So let's let's last few questions on Tesla. How do

825
00:44:42,719 --> 00:44:47,040
Speaker 1: you enjoy the automatic software updates? Which and how significant

826
00:44:47,080 --> 00:44:50,600
Speaker 1: are those changes to the car itself? For those that

827
00:44:50,600 --> 00:44:53,160
Speaker 1: are not familiar with how Tesla services their cars. If

828
00:44:53,239 --> 00:44:56,440
Speaker 1: it's not a mechanical problem. What they do. You have

829
00:44:56,600 --> 00:44:59,120
Speaker 1: full time internet in the car. While you're sleeping, you

830
00:44:59,200 --> 00:45:03,320
Speaker 1: get a down node of the new software, the operating system,

831
00:45:03,480 --> 00:45:06,439
Speaker 1: gizmore or whatever gadget that they've added to the car.

832
00:45:07,160 --> 00:45:11,680
Speaker 1: It happens remotely. It's incredible. They'll just wake up in

833
00:45:11,719 --> 00:45:14,719
Speaker 1: the morning and you've got you've got this update, and

834
00:45:14,800 --> 00:45:18,040
Speaker 1: it tells you exactly what you got. And also with

835
00:45:18,120 --> 00:45:19,879
Speaker 1: the respect of the car I have, which is auto,

836
00:45:19,920 --> 00:45:21,880
Speaker 1: has autopilot. So it's one of these ones that when

837
00:45:21,920 --> 00:45:23,520
Speaker 1: you get on the freeway and you're you're doing a

838
00:45:23,560 --> 00:45:25,399
Speaker 1: long trip. Let's say you're driving from we're going from

839
00:45:25,440 --> 00:45:28,400
Speaker 1: here to Washington, d C. Once we're on the freeway,

840
00:45:28,480 --> 00:45:30,799
Speaker 1: I put it into autopilot, I tell it how many

841
00:45:30,840 --> 00:45:33,280
Speaker 1: cars of safety I would like, and it just drives

842
00:45:33,840 --> 00:45:36,920
Speaker 1: your your hands free, your pedal free, so you have

843
00:45:36,960 --> 00:45:39,760
Speaker 1: a lot less. So it's when you're stopping driving, going,

844
00:45:39,840 --> 00:45:43,320
Speaker 1: stopping going, and steering on everything including stopping go traffic.

845
00:45:43,360 --> 00:45:45,319
Speaker 1: If you end up in a jam, it'll stop. It'll

846
00:45:45,360 --> 00:45:47,680
Speaker 1: just keep you know, inching along with traffic. It'll and

847
00:45:47,719 --> 00:45:50,480
Speaker 1: it'll ramp up to speed and you get there, you're

848
00:45:50,520 --> 00:45:54,080
Speaker 1: way less fatigued. But more importantly, it's space safer, the

849
00:45:54,920 --> 00:45:56,960
Speaker 1: ability if you know, God forbid that you end up

850
00:45:57,000 --> 00:45:59,279
Speaker 1: rerending someone, which is it happens in the world. That's

851
00:45:59,320 --> 00:46:01,959
Speaker 1: what Those are the most common accidents that should pretty

852
00:46:02,040 --> 00:46:05,759
Speaker 1: much go away if you've engaged this autopilot features the

853
00:46:05,840 --> 00:46:08,759
Speaker 1: normal the normal distractions that lead to a person to

854
00:46:09,520 --> 00:46:13,080
Speaker 1: I just saw one to look at the radio, they

855
00:46:13,160 --> 00:46:19,800
Speaker 1: dropped their whatever. This now can can do this pretty

856
00:46:19,880 --> 00:46:23,680
Speaker 1: much on highways. How far is it before this can

857
00:46:23,760 --> 00:46:27,439
Speaker 1: do this like the Google cars anywhere, Well, it works

858
00:46:27,480 --> 00:46:29,160
Speaker 1: even in the city. What it what it doesn't do

859
00:46:29,360 --> 00:46:32,640
Speaker 1: right now is to leave a parking space, navigate red

860
00:46:32,760 --> 00:46:34,560
Speaker 1: lights and turn you know, all that kind of stuff,

861
00:46:34,600 --> 00:46:37,120
Speaker 1: and and arrived to another parking space. That's what is

862
00:46:37,120 --> 00:46:39,640
Speaker 1: going to be the full autonomous driving. That's the next wave.

863
00:46:40,200 --> 00:46:42,480
Speaker 1: Which it doesn't keep me up at night. I'm not

864
00:46:42,560 --> 00:46:45,759
Speaker 1: even really too concerned about that. It's something that's for

865
00:46:45,920 --> 00:46:48,000
Speaker 1: you know, speaking from an investor, I mean, what is

866
00:46:48,040 --> 00:46:51,160
Speaker 1: it five seven, ten years down the road. Maybe it's

867
00:46:51,160 --> 00:46:55,240
Speaker 1: not going to impact my my portfolio decisions today. Interesting alright,

868
00:46:55,280 --> 00:46:59,000
Speaker 1: So beyond Tesla. Let's talk a little bit about some

869
00:46:59,160 --> 00:47:05,360
Speaker 1: of the questions we we didn't get to um the

870
00:47:05,520 --> 00:47:11,160
Speaker 1: charging stations, the network of charging stations. How how was

871
00:47:11,280 --> 00:47:16,759
Speaker 1: that put into place so quickly, so effectively, And what

872
00:47:16,920 --> 00:47:20,640
Speaker 1: are the costs to the Tesla owners for for doing

873
00:47:20,680 --> 00:47:25,520
Speaker 1: these chargings. For the first generation of US Tesla buyers,

874
00:47:25,600 --> 00:47:28,319
Speaker 1: it's free life of the car. So Tesla Corporation has

875
00:47:28,400 --> 00:47:30,839
Speaker 1: baked that into the price of the car. And they

876
00:47:31,200 --> 00:47:35,480
Speaker 1: effectively built this network of superchargers, which is a reasonable

877
00:47:35,560 --> 00:47:38,960
Speaker 1: distance connecting all the major cities in America today and

878
00:47:39,080 --> 00:47:42,520
Speaker 1: it works with these UM a white box. It's about

879
00:47:42,560 --> 00:47:46,319
Speaker 1: five ft tall, about a foot wide, and it's made

880
00:47:46,360 --> 00:47:48,640
Speaker 1: in a central factory. They ship them out to electrical

881
00:47:48,719 --> 00:47:52,640
Speaker 1: contractors around the nation. They procure real estate at shopping

882
00:47:52,719 --> 00:47:55,840
Speaker 1: centers or restaurants or what have you between all these cities,

883
00:47:56,600 --> 00:47:59,160
Speaker 1: and they implement the charging system. They wire them up,

884
00:47:59,400 --> 00:48:02,719
Speaker 1: and they're doing at a very quick rate. There's some

885
00:48:02,920 --> 00:48:05,960
Speaker 1: many thousands of them already. These are the superchargers or

886
00:48:06,040 --> 00:48:09,440
Speaker 1: the regular the superchargers, and the supercharger enables you to

887
00:48:09,640 --> 00:48:14,279
Speaker 1: top up the car to about in thirty minutes, which

888
00:48:14,360 --> 00:48:16,680
Speaker 1: is all you need because if you're going from city

889
00:48:16,719 --> 00:48:18,800
Speaker 1: to city. You just need to make it to the

890
00:48:18,880 --> 00:48:21,440
Speaker 1: next supercharger with a bit of a buffer if if

891
00:48:21,640 --> 00:48:24,560
Speaker 1: the carts to be cool, cool or heated, and that's

892
00:48:24,600 --> 00:48:27,880
Speaker 1: all you care about. And it does this flawlessly. I

893
00:48:27,960 --> 00:48:30,240
Speaker 1: went the entire trip. I did not have one issue.

894
00:48:30,280 --> 00:48:32,360
Speaker 1: California has a little bit of traffic though sometimes you

895
00:48:32,400 --> 00:48:35,760
Speaker 1: can see these stations full of Tesla's people. They're charging

896
00:48:35,800 --> 00:48:38,600
Speaker 1: their car, but it's easy to do, actually wait for

897
00:48:38,960 --> 00:48:41,320
Speaker 1: a charger. I never waited, but you could see that

898
00:48:41,320 --> 00:48:44,560
Speaker 1: they're full. The good news is the Electricians of America

899
00:48:44,640 --> 00:48:46,480
Speaker 1: can keep building out these things. If you have a

900
00:48:46,520 --> 00:48:50,319
Speaker 1: particularly busy station, more chargers. What's the software like? Does

901
00:48:50,440 --> 00:48:52,440
Speaker 1: it tells you where it is? Does it tell you, hey,

902
00:48:52,560 --> 00:48:54,759
Speaker 1: this is full? Is it? Is it that advanced? Or

903
00:48:55,320 --> 00:48:57,279
Speaker 1: it just says, here's the next charger and here you

904
00:48:57,360 --> 00:48:59,800
Speaker 1: have enough juice to get there. Oh, it's it's that advanced.

905
00:48:59,800 --> 00:49:01,719
Speaker 1: It tells you exactly what you have, what kind of

906
00:49:01,760 --> 00:49:03,440
Speaker 1: what kind of services are there? Maybe you want to

907
00:49:03,440 --> 00:49:05,320
Speaker 1: go to a different one because it has the restaurant

908
00:49:05,400 --> 00:49:07,360
Speaker 1: or coffee shop that you like. It tells you if

909
00:49:07,400 --> 00:49:10,280
Speaker 1: it's full all these things. It tells you the amount

910
00:49:10,320 --> 00:49:13,120
Speaker 1: of miles to get there, how much juice you're gonna

911
00:49:13,160 --> 00:49:16,040
Speaker 1: have left when you arrive, and of course the next destination,

912
00:49:16,080 --> 00:49:17,839
Speaker 1: because sometimes you don't have to wait thirty minutes, might

913
00:49:17,880 --> 00:49:19,160
Speaker 1: only be ten minutes, so you can get to your

914
00:49:19,239 --> 00:49:23,600
Speaker 1: destination and then charge there. So that is the superchargers.

915
00:49:23,640 --> 00:49:25,759
Speaker 1: But then people probably also want to know what about

916
00:49:25,880 --> 00:49:28,160
Speaker 1: when I'm not traveling city to city. Let's say I'm

917
00:49:28,200 --> 00:49:31,600
Speaker 1: just I drive twenty miles a day. I live in Raleigh,

918
00:49:31,600 --> 00:49:35,480
Speaker 1: North Carolina, and I commute around the city. How does

919
00:49:35,520 --> 00:49:38,080
Speaker 1: that change? Well, how often do you drive more than

920
00:49:38,080 --> 00:49:40,600
Speaker 1: two it fifty miles in a day in your own city? Almost?

921
00:49:40,840 --> 00:49:42,400
Speaker 1: I don't. I don't know many people that do that.

922
00:49:42,800 --> 00:49:45,399
Speaker 1: This is a this is a very rare or less

923
00:49:45,400 --> 00:49:48,040
Speaker 1: than one percent of the population. Do you sleep every day?

924
00:49:48,400 --> 00:49:50,880
Speaker 1: Of course so do I fantastic I do the charging

925
00:49:50,920 --> 00:49:53,120
Speaker 1: while I'm sleeping. And if you live in a dual

926
00:49:53,200 --> 00:49:58,160
Speaker 1: tariff area, meaning electricity is cheap at night when you're sleeping,

927
00:49:58,239 --> 00:50:00,640
Speaker 1: and it's expensive at five o'clock, well I'm not going

928
00:50:00,680 --> 00:50:03,080
Speaker 1: to charge my car at five o'clock when everyone's cooking dinner.

929
00:50:03,400 --> 00:50:06,440
Speaker 1: Because the utility says it's half price if you do

930
00:50:06,560 --> 00:50:09,120
Speaker 1: it at ten o'clock. In my program, the charger to

931
00:50:09,520 --> 00:50:11,919
Speaker 1: say charge charges from two to four in the morning

932
00:50:12,000 --> 00:50:15,160
Speaker 1: or whatever. It is absolutely, absolutely and there comes a

933
00:50:15,280 --> 00:50:19,880
Speaker 1: whole another level of infrastructure, of software, of convenience, of

934
00:50:20,000 --> 00:50:26,719
Speaker 1: design with making the charging lifestyle better location wise. You

935
00:50:26,760 --> 00:50:28,759
Speaker 1: know you're gonna be everywhere you go now because I

936
00:50:28,840 --> 00:50:31,520
Speaker 1: keep telling people you you already can connect lifestyle point

937
00:50:31,560 --> 00:50:34,720
Speaker 1: A to b. You know almost every city in America.

938
00:50:35,040 --> 00:50:36,160
Speaker 1: So if you go to the gym, you go to

939
00:50:36,200 --> 00:50:38,520
Speaker 1: the grocery store, you're going to Long Island, where wherever,

940
00:50:38,719 --> 00:50:41,880
Speaker 1: to the Hampton's. Whatever you're doing when you drive sixty

941
00:50:41,960 --> 00:50:45,960
Speaker 1: or seventy miles, you can now replace that because the

942
00:50:46,400 --> 00:50:49,640
Speaker 1: quicker destination chargers are at a rate of about forty

943
00:50:50,200 --> 00:50:54,000
Speaker 1: seven miles for each hour that you're charging. That's that's

944
00:50:54,120 --> 00:50:56,880
Speaker 1: that's what you get tanking up if you will. So

945
00:50:57,000 --> 00:51:00,719
Speaker 1: it um So these destination charge is there how many

946
00:51:00,760 --> 00:51:04,279
Speaker 1: of these out and about, although there are probably in

947
00:51:04,320 --> 00:51:07,720
Speaker 1: the millions already that many. They used to cost fifteen

948
00:51:07,800 --> 00:51:11,320
Speaker 1: hundred dollars. Now they cost five dollars. You go to Tesla,

949
00:51:11,560 --> 00:51:14,279
Speaker 1: they'll sell it to you and it takes an electrician

950
00:51:14,920 --> 00:51:17,040
Speaker 1: three or four or five hours to install. That sounds

951
00:51:17,120 --> 00:51:19,360
Speaker 1: like a lot. I would imagine it's even less than that.

952
00:51:19,480 --> 00:51:22,040
Speaker 1: These days you usually put it close to the electrical

953
00:51:22,120 --> 00:51:25,200
Speaker 1: service box. And so I tell people that there are

954
00:51:25,360 --> 00:51:28,760
Speaker 1: about a million electricians in America. If they each installed

955
00:51:29,400 --> 00:51:32,560
Speaker 1: you know, ten in a year, can we do that? Yeah,

956
00:51:32,800 --> 00:51:36,480
Speaker 1: well that's ten million destination chargers in one year. Who's

957
00:51:36,480 --> 00:51:38,480
Speaker 1: paying the five grand for that? And who pays for

958
00:51:38,520 --> 00:51:41,480
Speaker 1: the electricity? Well? Those are different. Because now if you're

959
00:51:41,480 --> 00:51:44,239
Speaker 1: a business, if you own a chain of hotels, I

960
00:51:44,280 --> 00:51:48,239
Speaker 1: would say you must have destination charging? Is it too?

961
00:51:48,360 --> 00:51:49,919
Speaker 1: Is it? Four? Is it ten? Will see how busy

962
00:51:49,960 --> 00:51:53,399
Speaker 1: you're it gets for your business, but we you won't

963
00:51:53,440 --> 00:51:55,160
Speaker 1: even be asking for it. If you don't have it,

964
00:51:55,520 --> 00:51:59,560
Speaker 1: you're going to become a relic. You'll you'll lose that audience,

965
00:51:59,600 --> 00:52:02,200
Speaker 1: at least you'll lose that today exactly. And that's the

966
00:52:02,719 --> 00:52:05,640
Speaker 1: small investment. Small investment. It's no different than a hotel

967
00:52:05,719 --> 00:52:08,239
Speaker 1: offering internet. You know twenty years ago you thought about it.

968
00:52:08,480 --> 00:52:10,800
Speaker 1: Today it's an automatic and it will be every business.

969
00:52:10,960 --> 00:52:12,800
Speaker 1: It'll be across the board, and it won't be a

970
00:52:12,840 --> 00:52:14,319
Speaker 1: shopping center. It won't be two of them. You're going

971
00:52:14,360 --> 00:52:16,759
Speaker 1: to see a bank of you know, thirty fifty of

972
00:52:16,880 --> 00:52:19,520
Speaker 1: these chargers that cater to all the electric cars that

973
00:52:19,560 --> 00:52:22,080
Speaker 1: are coming. So let's talk a little bit about some

974
00:52:22,200 --> 00:52:25,960
Speaker 1: other other things that we missed before. Tell me about

975
00:52:26,200 --> 00:52:29,920
Speaker 1: the new spending class. What is the new spending class.

976
00:52:31,960 --> 00:52:35,680
Speaker 1: The new spending class is an army of consumers that

977
00:52:36,480 --> 00:52:40,000
Speaker 1: they're not so called USA middle class wealthy. You know,

978
00:52:40,040 --> 00:52:42,440
Speaker 1: they don't make fifty dollars a year, but they have

979
00:52:42,600 --> 00:52:45,440
Speaker 1: the same economic footprint that you and I have. So

980
00:52:45,560 --> 00:52:48,520
Speaker 1: they basically they watch television every day, they drive a car,

981
00:52:48,760 --> 00:52:51,759
Speaker 1: they have air conditioning, they eat deluxe meals, which means

982
00:52:51,800 --> 00:52:55,080
Speaker 1: those meals need to be grown and delivered, and they

983
00:52:55,200 --> 00:52:59,120
Speaker 1: outnumber us by a margin. We all heard the term

984
00:52:59,239 --> 00:53:03,279
Speaker 1: emerging mark it's well, twenty five years later, more people

985
00:53:03,360 --> 00:53:06,720
Speaker 1: have emerged than those that are still left so called emerging.

986
00:53:07,120 --> 00:53:08,320
Speaker 1: But what do we call them? We don't have a

987
00:53:08,360 --> 00:53:11,040
Speaker 1: phrase for these people. I call them the new spending class.

988
00:53:11,280 --> 00:53:13,480
Speaker 1: So they're not rich, they're not poor, but we have

989
00:53:13,640 --> 00:53:17,520
Speaker 1: to follow their spending patterns. And of course, the biggest group,

990
00:53:17,560 --> 00:53:20,439
Speaker 1: which is the biggest demographic group in the world, which

991
00:53:20,480 --> 00:53:24,359
Speaker 1: is that massive population of China. I use that as

992
00:53:24,440 --> 00:53:27,759
Speaker 1: the example that weaves its way through my book over

993
00:53:27,880 --> 00:53:30,480
Speaker 1: and over and over, and we look at them the

994
00:53:30,560 --> 00:53:34,160
Speaker 1: demographics of China and four major blocks, and the biggest one,

995
00:53:34,200 --> 00:53:36,600
Speaker 1: of course, with the most impact and the most future

996
00:53:37,160 --> 00:53:41,120
Speaker 1: are the millennials of China. Four hundred and fifteen million people.

997
00:53:41,440 --> 00:53:44,480
Speaker 1: That's amazing. That's a hundred and fifty of the total

998
00:53:44,560 --> 00:53:49,000
Speaker 1: population of the US exactly, and it's it's their wants

999
00:53:49,080 --> 00:53:52,880
Speaker 1: and their needs. They have far higher expectations than the

1000
00:53:52,960 --> 00:53:56,359
Speaker 1: generations before them. I know this. Look at the level

1001
00:53:56,440 --> 00:53:59,160
Speaker 1: of enlightenment. The people that run China are those the

1002
00:53:59,239 --> 00:54:01,560
Speaker 1: children of the Cultu real Revolution. They're sort of fifty

1003
00:54:01,640 --> 00:54:04,920
Speaker 1: five to maybe seventy hundred and sixty million people in

1004
00:54:05,000 --> 00:54:09,320
Speaker 1: that demographic block, but only one million graduated university. That's amazing,

1005
00:54:09,640 --> 00:54:12,320
Speaker 1: less than one percent, less than one percent. These millennials

1006
00:54:12,320 --> 00:54:14,320
Speaker 1: I talk about this, four and fifty million, over a

1007
00:54:14,400 --> 00:54:18,960
Speaker 1: hundred million have already graduated university, typically in science, science, technology, engineering,

1008
00:54:19,000 --> 00:54:23,920
Speaker 1: and math stem fields. These way higher expectations. The majority

1009
00:54:24,000 --> 00:54:26,960
Speaker 1: of these young people were born rural, the majority now

1010
00:54:27,080 --> 00:54:31,000
Speaker 1: live urban. And what do they want? They want everything

1011
00:54:31,040 --> 00:54:33,080
Speaker 1: you and I have. In fact, they know how the

1012
00:54:33,120 --> 00:54:36,120
Speaker 1: world works. They have an Internet connection. I mean, these

1013
00:54:36,160 --> 00:54:38,719
Speaker 1: people are not ignorant to the to the comfort convenience

1014
00:54:38,760 --> 00:54:42,560
Speaker 1: communication that everyone wants and everyone is taking for granted.

1015
00:54:43,080 --> 00:54:45,760
Speaker 1: And we've seen this in their in their spending patterns,

1016
00:54:45,840 --> 00:54:49,760
Speaker 1: and in how they're future is changing. And it's happening

1017
00:54:50,440 --> 00:54:53,360
Speaker 1: so fast. It's not even five year blocks. You have

1018
00:54:53,440 --> 00:54:54,960
Speaker 1: to be aware of the hyper aware of this stuff.

1019
00:54:55,000 --> 00:54:57,120
Speaker 1: In sort of two year blocks, it's being turned up

1020
00:54:57,719 --> 00:54:59,840
Speaker 1: top to bottom. So you've you've spent quite a bit

1021
00:54:59,880 --> 00:55:03,040
Speaker 1: of time in China. What what cities have you spend

1022
00:55:03,120 --> 00:55:06,200
Speaker 1: time in over there? I traveled I've been to China

1023
00:55:06,400 --> 00:55:10,160
Speaker 1: a couple of times, and I traveled the country by train,

1024
00:55:10,440 --> 00:55:12,320
Speaker 1: so rather than fly city to city, I thought it

1025
00:55:12,400 --> 00:55:15,520
Speaker 1: was important to sort of see the landscape and understand

1026
00:55:15,640 --> 00:55:19,399
Speaker 1: how what does it look like? And although I've seen

1027
00:55:19,440 --> 00:55:21,920
Speaker 1: a lot of China, I've I've you know, visit a

1028
00:55:21,960 --> 00:55:23,399
Speaker 1: lot of the country. I've been there a couple of times,

1029
00:55:23,440 --> 00:55:24,799
Speaker 1: what have I seen a bit nothing? I mean, it's

1030
00:55:24,840 --> 00:55:28,120
Speaker 1: the same size as America, right, So to really understand

1031
00:55:28,200 --> 00:55:31,640
Speaker 1: it and go to all the those those other places,

1032
00:55:31,680 --> 00:55:33,440
Speaker 1: it'll take me a lot longer. I'm gonna be going

1033
00:55:33,480 --> 00:55:35,640
Speaker 1: again due to the book. We're taking the book into

1034
00:55:35,680 --> 00:55:38,560
Speaker 1: the Chinese language. But the one thing that I will

1035
00:55:38,640 --> 00:55:44,600
Speaker 1: tell you is that the Chinese population, they are optimists,

1036
00:55:44,760 --> 00:55:48,800
Speaker 1: they're speculators, and by disposition, what what do these people?

1037
00:55:49,680 --> 00:55:51,399
Speaker 1: I think that the future is going to be better.

1038
00:55:52,239 --> 00:55:56,200
Speaker 1: They're not pessimistic. They don't have this you know, you know,

1039
00:55:56,480 --> 00:55:59,520
Speaker 1: beaten down sort of like a salary stagnation that we've

1040
00:55:59,560 --> 00:56:03,520
Speaker 1: had in Europe in the West, and it's it's just

1041
00:56:03,640 --> 00:56:07,239
Speaker 1: incredible to the human potential of what's going on, not

1042
00:56:07,360 --> 00:56:10,360
Speaker 1: just in China but in emerging markets in general, is

1043
00:56:10,719 --> 00:56:13,840
Speaker 1: just a staggering sort of Um well, they're closer to

1044
00:56:13,960 --> 00:56:17,480
Speaker 1: that zero bound level than they are to the we've

1045
00:56:17,520 --> 00:56:22,080
Speaker 1: peaked and we've gone plateaued. So to them, the direction

1046
00:56:22,239 --> 00:56:25,520
Speaker 1: is it's heading in the right right way. People who

1047
00:56:26,120 --> 00:56:29,279
Speaker 1: experience that peak in plateau, you can see why there's

1048
00:56:29,280 --> 00:56:33,640
Speaker 1: a little concern and worry. Hey, how come Although it

1049
00:56:33,719 --> 00:56:36,480
Speaker 1: does seem to be very cyclical. We we had that

1050
00:56:36,600 --> 00:56:39,120
Speaker 1: in the seventies and eighties, and now we're having it

1051
00:56:39,200 --> 00:56:41,239
Speaker 1: again in the two thousand's. We'll see if this goes

1052
00:56:41,280 --> 00:56:45,120
Speaker 1: away and comes back. Um in another twenty years. Tell

1053
00:56:45,239 --> 00:56:48,080
Speaker 1: us about the ghost cities of China and why do

1054
00:56:48,160 --> 00:56:50,760
Speaker 1: you think, uh, there was a big sixty minutes, pets

1055
00:56:50,840 --> 00:56:52,560
Speaker 1: and a number of other things. Why do you think

1056
00:56:53,320 --> 00:57:01,239
Speaker 1: that concern is unnecessary? Well, it is important. We can't

1057
00:57:01,440 --> 00:57:03,719
Speaker 1: you know, just dismiss it for nothing. But China has

1058
00:57:04,080 --> 00:57:07,120
Speaker 1: many different tiers of big cities. So you've got the

1059
00:57:07,160 --> 00:57:09,000
Speaker 1: Tier one cities, which are the big you know, twenty

1060
00:57:09,080 --> 00:57:12,120
Speaker 1: million people living in them, Tier two, which might be

1061
00:57:12,200 --> 00:57:14,120
Speaker 1: five to ten million, and then we have the Tier

1062
00:57:14,239 --> 00:57:17,040
Speaker 1: three and Tier four cities. This is there's been some

1063
00:57:17,120 --> 00:57:20,040
Speaker 1: situations of ghost cities which which do exist. If you

1064
00:57:20,120 --> 00:57:21,680
Speaker 1: build it, they will come. This is we have to

1065
00:57:21,760 --> 00:57:25,280
Speaker 1: forget that China is a planned economy. Are there examples

1066
00:57:25,360 --> 00:57:27,479
Speaker 1: in the country of China where they've built a city

1067
00:57:27,520 --> 00:57:30,000
Speaker 1: that should house a million people for their distant future

1068
00:57:30,280 --> 00:57:33,120
Speaker 1: and maybe it's not full yet. Yeah, I I would

1069
00:57:33,120 --> 00:57:35,640
Speaker 1: imagine that there. That's what they're doing. I look at

1070
00:57:36,000 --> 00:57:38,960
Speaker 1: this four fifteen million millennials. They're all under the age

1071
00:57:39,000 --> 00:57:41,600
Speaker 1: of thirty five. By most of these people do not yet,

1072
00:57:42,120 --> 00:57:45,240
Speaker 1: you know, have their own home that's coming. Where are

1073
00:57:45,280 --> 00:57:47,960
Speaker 1: they all going to live? You know? This this will

1074
00:57:48,040 --> 00:57:51,040
Speaker 1: get take. This will get resolved in the course of time.

1075
00:57:51,080 --> 00:57:53,040
Speaker 1: And a lot of it is function of price. These

1076
00:57:53,080 --> 00:57:55,840
Speaker 1: things are a lot cheaper, they're discounted. But if you

1077
00:57:56,080 --> 00:57:59,240
Speaker 1: speak to people that own, you know, vast real estate

1078
00:57:59,280 --> 00:58:02,040
Speaker 1: portfolios and China. Know, the richest man in China the

1079
00:58:02,720 --> 00:58:05,480
Speaker 1: Dailine Wanda Group, which has the biggest balance sheet, if

1080
00:58:05,520 --> 00:58:08,760
Speaker 1: you will, he looks at the debt levels, governmental debt levels,

1081
00:58:08,800 --> 00:58:11,840
Speaker 1: and tier one tier two city debt levels. He is

1082
00:58:11,880 --> 00:58:14,080
Speaker 1: not concerned. Okay, lives in China and he's not going

1083
00:58:14,120 --> 00:58:16,120
Speaker 1: to sit there and bash the system and bash the government.

1084
00:58:16,680 --> 00:58:18,480
Speaker 1: But you know, he is concerned a little bit about

1085
00:58:18,480 --> 00:58:20,920
Speaker 1: Tier three and tier four cities has to get work

1086
00:58:20,960 --> 00:58:24,000
Speaker 1: to the system. Will the if I liken it to America,

1087
00:58:24,040 --> 00:58:28,439
Speaker 1: will the Kalamazoos and the Tallahassees of China bring down

1088
00:58:28,480 --> 00:58:31,800
Speaker 1: the system? That's the question investors have to ask. In

1089
00:58:31,880 --> 00:58:33,960
Speaker 1: the short term, anything can happen. And when I follow

1090
00:58:34,040 --> 00:58:36,560
Speaker 1: this stuff, which I follow China like a financial soap opera,

1091
00:58:37,040 --> 00:58:40,200
Speaker 1: I'm not necessarily continuing, you know, to read the people

1092
00:58:40,240 --> 00:58:42,640
Speaker 1: that agree with me. I read the Kyle Basses, I

1093
00:58:42,680 --> 00:58:44,480
Speaker 1: read the Jim Chainos of the world. What am I

1094
00:58:44,600 --> 00:58:48,120
Speaker 1: missing anything can happen in the short term. I just

1095
00:58:48,760 --> 00:58:51,520
Speaker 1: I am not concerned about the Chinese economy in the

1096
00:58:51,640 --> 00:58:55,800
Speaker 1: medium to long run. I just am not. Facts can

1097
00:58:55,880 --> 00:58:58,120
Speaker 1: change and we'll see what happens. We have to liken

1098
00:58:58,280 --> 00:59:01,680
Speaker 1: the the economy to the stock market, and it is

1099
00:59:01,760 --> 00:59:07,920
Speaker 1: becoming overwhelmingly a consumer society based on services. So let

1100
00:59:07,960 --> 00:59:10,000
Speaker 1: me shift gears up a little bit on you. Um,

1101
00:59:10,240 --> 00:59:13,240
Speaker 1: you talk about you're the founder of the CEO two

1102
00:59:14,200 --> 00:59:20,840
Speaker 1: Master Solutions Partnership. What is that? This was a think

1103
00:59:20,880 --> 00:59:23,280
Speaker 1: tank of a group of guys that I that I

1104
00:59:23,400 --> 00:59:27,480
Speaker 1: associate with and deal with about looking at these challenges

1105
00:59:27,520 --> 00:59:32,000
Speaker 1: and opportunities burning a lot of shoe leather. We have

1106
00:59:32,160 --> 00:59:36,160
Speaker 1: been talking with endowments and foundations, and now it's becoming

1107
00:59:36,360 --> 00:59:40,760
Speaker 1: a vehicle for us to invest in all the elements

1108
00:59:41,200 --> 00:59:44,360
Speaker 1: that factually make the reduction and CEO two emissions possible.

1109
00:59:44,720 --> 00:59:47,440
Speaker 1: What does that include, Well, this has to be a

1110
00:59:47,560 --> 00:59:50,720
Speaker 1: strategy that's a lot that's ambivalent. So it basically if

1111
00:59:50,760 --> 00:59:54,880
Speaker 1: you look at a typical portfolio construction. First, I will

1112
00:59:54,920 --> 00:59:57,320
Speaker 1: I will preface it by saying we've always followed these things.

1113
00:59:57,360 --> 00:59:58,959
Speaker 1: The things I'm gonna talk about now, we're not getting

1114
00:59:59,000 --> 01:00:01,760
Speaker 1: into this because it's popular or themic. You know, we've

1115
01:00:01,840 --> 01:00:04,320
Speaker 1: done you know, I've got twenty years of experience. My partner,

1116
01:00:04,400 --> 01:00:08,040
Speaker 1: Matt Sublowski has got fifteen years of experience looking at

1117
01:00:08,120 --> 01:00:10,600
Speaker 1: these things. So let's look at a typical portfolio construction,

1118
01:00:10,640 --> 01:00:13,680
Speaker 1: subliminal ideas for people to look at within reduction of

1119
01:00:13,760 --> 01:00:16,000
Speaker 1: CEO two emissions. Well, first of all, it's the building

1120
01:00:16,000 --> 01:00:18,440
Speaker 1: blocks that make it possible, right, So we look at that.

1121
01:00:18,520 --> 01:00:20,280
Speaker 1: We're not going to invest in coal and oil, but

1122
01:00:20,360 --> 01:00:23,240
Speaker 1: we are going to look at things like copper. That's

1123
01:00:23,240 --> 01:00:25,480
Speaker 1: important the fabrication of it. We're gonna look at the

1124
01:00:25,480 --> 01:00:29,440
Speaker 1: automotive industry. You know, there's basically the winners and losers there.

1125
01:00:29,480 --> 01:00:31,400
Speaker 1: So there's there's the lazy incumbents and then there's the

1126
01:00:31,440 --> 01:00:34,440
Speaker 1: progressive incumbents. You look at a country like Germany, all

1127
01:00:34,480 --> 01:00:36,480
Speaker 1: the people that feed into the parts that feed into

1128
01:00:36,520 --> 01:00:40,320
Speaker 1: the automotive industry. How's that going to change? You've got

1129
01:00:40,440 --> 01:00:45,600
Speaker 1: dozens of private and public companies that make cranks, pistons, radiators, valves, mufflers.

1130
01:00:46,480 --> 01:00:49,840
Speaker 1: That industry is changing. We look at the technologies that

1131
01:00:50,000 --> 01:00:54,880
Speaker 1: make this future energy economy possible, right, and that's people

1132
01:00:54,960 --> 01:00:56,440
Speaker 1: that look at how how do you charge a car,

1133
01:00:56,480 --> 01:00:58,280
Speaker 1: how do you manufacture them, how we're gonna sell them.

1134
01:00:58,560 --> 01:01:01,640
Speaker 1: We look at the creation trans utilization of energy in general.

1135
01:01:02,120 --> 01:01:05,840
Speaker 1: It's changing so far deeper than just investing in a

1136
01:01:05,920 --> 01:01:07,920
Speaker 1: solar company or in a wind company. Let's look at

1137
01:01:07,960 --> 01:01:11,720
Speaker 1: the gizmos, products in fabrication, the gearing that makes that

1138
01:01:11,760 --> 01:01:14,080
Speaker 1: stuff possible, because there if they're gonna be busier, it's good.

1139
01:01:14,320 --> 01:01:16,520
Speaker 1: How do we desalinate water? Who's going to do it?

1140
01:01:16,840 --> 01:01:19,960
Speaker 1: What are the components made to make that possible? The

1141
01:01:20,920 --> 01:01:24,800
Speaker 1: static ville, which is the vast network of pipelines, railroads

1142
01:01:25,280 --> 01:01:30,720
Speaker 1: and distribution of electricity, tectonic shift again, tectonic shift, So

1143
01:01:30,840 --> 01:01:33,040
Speaker 1: we're looking at all the components that make that possible.

1144
01:01:33,080 --> 01:01:34,680
Speaker 1: And of course we get into the just a general

1145
01:01:35,080 --> 01:01:39,280
Speaker 1: utilization of energy. So it's it's a vast sort of

1146
01:01:39,480 --> 01:01:43,040
Speaker 1: arena that we're looking at, understanding and investing in. So

1147
01:01:43,440 --> 01:01:46,120
Speaker 1: it's more than just the thing tank. It's a private

1148
01:01:46,200 --> 01:01:51,040
Speaker 1: investment partnership that you are looking to take advantage of

1149
01:01:51,120 --> 01:01:53,760
Speaker 1: client of the changes that are taking place in the

1150
01:01:53,840 --> 01:01:58,640
Speaker 1: global uh climate, global world and basically global world. Is

1151
01:01:58,720 --> 01:02:04,800
Speaker 1: that a phrase in the global environmental world and make

1152
01:02:05,040 --> 01:02:09,040
Speaker 1: informed investments based on what you see as the next

1153
01:02:09,120 --> 01:02:12,400
Speaker 1: coming trends. Yeah, as I call the algebra in the

1154
01:02:12,600 --> 01:02:16,480
Speaker 1: this shift in energy away from fossil fuels. We understand

1155
01:02:16,520 --> 01:02:18,960
Speaker 1: fossil fuels are important, but there is a shift happening.

1156
01:02:19,120 --> 01:02:20,960
Speaker 1: You can argue is that happening faster slow? But it

1157
01:02:21,080 --> 01:02:23,160
Speaker 1: is happening, and we're looking at the other side of

1158
01:02:23,200 --> 01:02:26,440
Speaker 1: that algebraic equation, and we want to understand and support

1159
01:02:26,480 --> 01:02:31,760
Speaker 1: and of course invest in those products, materials and building blocks.

1160
01:02:32,120 --> 01:02:36,200
Speaker 1: It makes sense. So let's jump into our favorite questions

1161
01:02:36,240 --> 01:02:38,880
Speaker 1: that we ask all of our guests. Um, we went

1162
01:02:38,960 --> 01:02:41,760
Speaker 1: over your background. Uh, tell me a little bit about

1163
01:02:41,840 --> 01:02:45,480
Speaker 1: some of your early mentors, Who who influenced your thought process,

1164
01:02:46,000 --> 01:02:50,360
Speaker 1: Who who led you to this career path. Yeah. I

1165
01:02:50,440 --> 01:02:53,960
Speaker 1: was a very curious person and I always surrounded myself

1166
01:02:54,080 --> 01:02:57,160
Speaker 1: with you know, father figure types of guys. And we're

1167
01:02:57,240 --> 01:03:01,360
Speaker 1: very lucky in Vancouver. There's a lot of UM influential

1168
01:03:02,120 --> 01:03:05,760
Speaker 1: sort of UM guru types in the themes that I

1169
01:03:05,880 --> 01:03:09,080
Speaker 1: follow and unlike, and I may like in this to

1170
01:03:09,160 --> 01:03:11,600
Speaker 1: the software industry, where it's hard to get access to

1171
01:03:11,680 --> 01:03:14,040
Speaker 1: the CEOs. Let's say it's hard to get access to

1172
01:03:14,640 --> 01:03:18,760
Speaker 1: Larry Ellison or or Elon Musk in our industry in Vancouver.

1173
01:03:18,880 --> 01:03:21,919
Speaker 1: It's actually you can actually rub shoulders with these guys.

1174
01:03:21,960 --> 01:03:23,960
Speaker 1: And if you I was a young guy that was

1175
01:03:24,080 --> 01:03:26,080
Speaker 1: very curious and I put a lot of effort into it,

1176
01:03:26,200 --> 01:03:28,600
Speaker 1: and I was able to sort of surround myself with

1177
01:03:28,720 --> 01:03:32,439
Speaker 1: these people like in these industries, and then we would

1178
01:03:32,440 --> 01:03:34,480
Speaker 1: travel together, we would go to conferences, and you know,

1179
01:03:35,120 --> 01:03:38,520
Speaker 1: ten years of dinners later, you you consider yourself friends

1180
01:03:38,560 --> 01:03:41,520
Speaker 1: and mentors and and sort of you take their collective

1181
01:03:41,560 --> 01:03:45,320
Speaker 1: experience and you put it into your own sort of path.

1182
01:03:45,560 --> 01:03:47,080
Speaker 1: And now that I'm a forty one years old now,

1183
01:03:47,160 --> 01:03:50,000
Speaker 1: so I'm sort of starting to mentor some younger people myself.

1184
01:03:50,720 --> 01:03:55,840
Speaker 1: So what about investors out there who have tread the

1185
01:03:55,880 --> 01:03:59,120
Speaker 1: path before you? What investors did you find influential to

1186
01:03:59,320 --> 01:04:04,640
Speaker 1: your uh thought process? I always love the wisdom of

1187
01:04:04,720 --> 01:04:07,600
Speaker 1: Warren Buffett. You can you can lose yourself and Warren

1188
01:04:07,600 --> 01:04:09,920
Speaker 1: Buffett sort of readings and videos and such, and a

1189
01:04:10,000 --> 01:04:11,840
Speaker 1: lot of people have followed him, of course, because he

1190
01:04:12,320 --> 01:04:14,400
Speaker 1: he's just he's able to tell a story in such

1191
01:04:15,000 --> 01:04:17,520
Speaker 1: plain English, you know. So I think you can still

1192
01:04:17,880 --> 01:04:19,960
Speaker 1: for those that have not enjoyed his wisdom. I mean,

1193
01:04:20,000 --> 01:04:21,880
Speaker 1: just go to YouTube and you can lose yourself for

1194
01:04:22,000 --> 01:04:25,560
Speaker 1: hours and sort of his his philosophies. Reading some of

1195
01:04:25,600 --> 01:04:27,920
Speaker 1: the books from before that you know, like Ben Graham

1196
01:04:28,000 --> 01:04:30,360
Speaker 1: of course, the famous Value Investor, and sort of just

1197
01:04:30,480 --> 01:04:33,720
Speaker 1: that plain street common sense you know that works, and

1198
01:04:34,360 --> 01:04:36,920
Speaker 1: Napoleon Hill and those books that they're they're just how

1199
01:04:37,000 --> 01:04:39,000
Speaker 1: to think and grow rich? Is that right? Yeah? Yeah,

1200
01:04:39,000 --> 01:04:41,800
Speaker 1: they're they're just timeless, They're just totally they're absolutely So

1201
01:04:41,880 --> 01:04:44,240
Speaker 1: I'm gonna ask you, let's let's jump into the next question.

1202
01:04:44,600 --> 01:04:46,480
Speaker 1: What are some of your favorite books? And that could

1203
01:04:46,480 --> 01:04:49,920
Speaker 1: be fiction nonfiction, and within the nonfiction it could either

1204
01:04:50,000 --> 01:04:53,000
Speaker 1: be technology or investment related or anything else. I don't

1205
01:04:53,000 --> 01:04:55,760
Speaker 1: want you to feel constrained. Tell me about what what

1206
01:04:56,040 --> 01:05:00,160
Speaker 1: books you found most influential. Let's talk about Napoleon Hill. Um,

1207
01:05:00,240 --> 01:05:02,480
Speaker 1: what did you What was your takeaway from Think and

1208
01:05:02,520 --> 01:05:05,960
Speaker 1: Grow Rich? Well, I think the that is I said

1209
01:05:06,000 --> 01:05:10,000
Speaker 1: already that that common that that street common sense. You

1210
01:05:10,040 --> 01:05:11,840
Speaker 1: know where you have to and you you also factor

1211
01:05:11,920 --> 01:05:16,960
Speaker 1: in psychology and and just basic practices that help your business.

1212
01:05:17,560 --> 01:05:19,280
Speaker 1: And the book is a is a quick read for

1213
01:05:19,320 --> 01:05:21,920
Speaker 1: anyone that hasn't read it yet, very very fast, and

1214
01:05:22,000 --> 01:05:23,920
Speaker 1: you can reread it probably every couple of years on

1215
01:05:23,960 --> 01:05:27,040
Speaker 1: summer vacation. Right now, this is my summer read this

1216
01:05:27,200 --> 01:05:29,840
Speaker 1: year is going to be a book by Mr McCullough,

1217
01:05:29,920 --> 01:05:32,760
Speaker 1: which is um, The Right Brothers, not that when I'm

1218
01:05:32,760 --> 01:05:34,520
Speaker 1: reading an older one. That's my next one. But it's

1219
01:05:34,600 --> 01:05:37,680
Speaker 1: The Mornings on Mornings, Mornings on Horseback, which is the

1220
01:05:37,720 --> 01:05:40,920
Speaker 1: book on the young Teddy Roosevelt, who is an incredible character.

1221
01:05:41,280 --> 01:05:44,120
Speaker 1: I don't know anyone who has read one of the

1222
01:05:44,200 --> 01:05:48,200
Speaker 1: mccaulla biographies and doesn't come away just wow. This was

1223
01:05:48,240 --> 01:05:52,160
Speaker 1: a fantastic research, the research, the storytelling. And I'm just

1224
01:05:52,760 --> 01:05:55,360
Speaker 1: breaking that one and I'm really looking forward to that

1225
01:05:55,520 --> 01:05:57,400
Speaker 1: and I'll probably have that read in the first three

1226
01:05:57,520 --> 01:05:59,720
Speaker 1: or four days of my vacation. Coming up. A book

1227
01:05:59,720 --> 01:06:02,520
Speaker 1: I all so recently read was was a Walter Isaacs

1228
01:06:02,560 --> 01:06:06,080
Speaker 1: and Steve Jobs, which is now the best selling biography

1229
01:06:06,120 --> 01:06:08,200
Speaker 1: I think in history. Is that true? I had no

1230
01:06:08,360 --> 01:06:11,560
Speaker 1: idea what a book, what a book, the storytelling. I

1231
01:06:11,640 --> 01:06:13,760
Speaker 1: actually met Walter Isaacson when he came to Vancouver in

1232
01:06:13,800 --> 01:06:16,160
Speaker 1: his book series My Friend that was sponsored it, so

1233
01:06:16,280 --> 01:06:19,440
Speaker 1: we were able to enjoy a dinner with him talking

1234
01:06:19,520 --> 01:06:23,120
Speaker 1: about some of the stories around making that book. Ye

1235
01:06:23,320 --> 01:06:26,200
Speaker 1: Jobs reached out to him and said, I listen, I

1236
01:06:26,280 --> 01:06:29,880
Speaker 1: want you to write my biography. Who does something like that.

1237
01:06:30,400 --> 01:06:33,240
Speaker 1: He originally was a little reluctant. It's a great book

1238
01:06:33,240 --> 01:06:37,240
Speaker 1: for anyone that wants to understand that that iconic you know, Americana,

1239
01:06:37,320 --> 01:06:39,120
Speaker 1: which is Apple and all that the history and a

1240
01:06:39,120 --> 01:06:42,000
Speaker 1: lot of the characters that were involved. One of my friends,

1241
01:06:42,120 --> 01:06:44,480
Speaker 1: Robert Friedland, is featured in the book. He was the

1242
01:06:44,480 --> 01:06:46,960
Speaker 1: guy with the apple farm in Oregon, and he was

1243
01:06:47,000 --> 01:06:51,360
Speaker 1: the guy that Walter Isaacson would say they taught or

1244
01:06:51,560 --> 01:06:55,800
Speaker 1: showed Steve Jobs that reality distortion field. And if anyone

1245
01:06:55,920 --> 01:06:58,520
Speaker 1: has seen Robert Friedland give a talk, you see it.

1246
01:06:58,600 --> 01:07:02,120
Speaker 1: I mean's just a captivating public speaker and amazing storyteller.

1247
01:07:02,640 --> 01:07:04,800
Speaker 1: And then which is the same with with Steve Jobs

1248
01:07:04,840 --> 01:07:07,120
Speaker 1: and so of what he was able to do. When

1249
01:07:07,160 --> 01:07:10,200
Speaker 1: I was almost finished the book, Barry, I saved the

1250
01:07:10,280 --> 01:07:12,760
Speaker 1: last forty pages and it took me three months. I

1251
01:07:12,840 --> 01:07:15,480
Speaker 1: put it on the shelf and I just waited, and

1252
01:07:15,840 --> 01:07:18,640
Speaker 1: you know, I read that last forty pages. It was

1253
01:07:18,720 --> 01:07:21,520
Speaker 1: just again I I just don't want that book to end.

1254
01:07:22,240 --> 01:07:24,400
Speaker 1: It was it was really interesting. There were a number

1255
01:07:24,440 --> 01:07:27,680
Speaker 1: of books that have come out since then sort of

1256
01:07:28,280 --> 01:07:31,720
Speaker 1: telling telling a different version of the story, including a

1257
01:07:31,840 --> 01:07:37,080
Speaker 1: few Apple authorized biographies. I thought the book was harsh

1258
01:07:37,160 --> 01:07:39,160
Speaker 1: but fair is that? Is that a good way to

1259
01:07:39,240 --> 01:07:44,600
Speaker 1: describe it. He's a mercurial, different, difficult character, but it

1260
01:07:44,720 --> 01:07:47,760
Speaker 1: seemed like he it was a very fair conversation. If

1261
01:07:47,800 --> 01:07:51,120
Speaker 1: there was any criticism. It's a little technology light. It's

1262
01:07:51,120 --> 01:07:54,480
Speaker 1: about Steve Jobs, the person that Steve Jobs, the technologist,

1263
01:07:55,400 --> 01:07:58,080
Speaker 1: which is is kind of interesting. Give me one more book?

1264
01:07:58,160 --> 01:08:01,360
Speaker 1: What else? What else have you read that really was

1265
01:08:01,640 --> 01:08:05,200
Speaker 1: influential to you when I was around twenty years old

1266
01:08:05,280 --> 01:08:08,080
Speaker 1: and probably the reason I wrote my book the way

1267
01:08:08,160 --> 01:08:11,480
Speaker 1: it is. There's a Canadian book was written by David Chilton.

1268
01:08:11,880 --> 01:08:15,400
Speaker 1: It's called The Wealthy Barber. That book sold two million

1269
01:08:15,520 --> 01:08:17,880
Speaker 1: copies in Canada. To give you is it a good book? Well?

1270
01:08:17,920 --> 01:08:21,639
Speaker 1: Two million? Healthy and it's it's a it's a simple

1271
01:08:21,720 --> 01:08:25,880
Speaker 1: book about a barber who's wealthy and his pay. His

1272
01:08:25,960 --> 01:08:27,840
Speaker 1: clients come in to cut their hair and he gives

1273
01:08:27,880 --> 01:08:33,599
Speaker 1: them investment advice, just plane plane, straight common sense stuff. Now,

1274
01:08:34,000 --> 01:08:36,040
Speaker 1: the book was around the days of eight and teen

1275
01:08:36,080 --> 01:08:37,960
Speaker 1: percent interest, so those days are gone. You can't just

1276
01:08:38,080 --> 01:08:40,639
Speaker 1: do that. The power of compound interest doesn't work anymore

1277
01:08:41,040 --> 01:08:43,320
Speaker 1: in this interest rate environment, which is a different discussion

1278
01:08:43,320 --> 01:08:45,760
Speaker 1: for a different day. But the but the way that

1279
01:08:45,840 --> 01:08:48,120
Speaker 1: book is written, I think it's fun and it was

1280
01:08:48,520 --> 01:08:51,679
Speaker 1: one of those early personal finance books that I read

1281
01:08:51,760 --> 01:08:53,920
Speaker 1: that I just love and I recommended to any young person,

1282
01:08:54,000 --> 01:08:56,320
Speaker 1: any millennial out there, you want to read that book

1283
01:08:56,320 --> 01:08:58,160
Speaker 1: because it gives you a good foundation. There are a

1284
01:08:58,280 --> 01:09:01,720
Speaker 1: run of parable books like that. The Wealthy Barber Um

1285
01:09:02,360 --> 01:09:05,680
Speaker 1: The Richest Man in Babylon is another similar book, and

1286
01:09:05,760 --> 01:09:08,320
Speaker 1: there's one other. I'm trying to remember the most recent

1287
01:09:09,240 --> 01:09:13,080
Speaker 1: UM version of that sort of paradox that I have

1288
01:09:13,200 --> 01:09:15,400
Speaker 1: it out there. I read it recently. I'm trying to

1289
01:09:15,400 --> 01:09:19,320
Speaker 1: remember the title. I'll dig it up UM. Alright, So,

1290
01:09:19,600 --> 01:09:24,839
Speaker 1: so beyond books, what what has changed since you've become

1291
01:09:25,800 --> 01:09:28,320
Speaker 1: a venture investor? What do you think is is the

1292
01:09:28,400 --> 01:09:33,240
Speaker 1: most significant positive and negative changes that that you've witnessed

1293
01:09:33,280 --> 01:09:37,400
Speaker 1: over the past decade. It's harder to be a stockpicker,

1294
01:09:37,760 --> 01:09:39,759
Speaker 1: you know, if we look at all the click trading

1295
01:09:39,800 --> 01:09:42,320
Speaker 1: that takes place in the world, people buy ETF s

1296
01:09:42,360 --> 01:09:44,840
Speaker 1: now Berry. You know, you look at the graph on

1297
01:09:44,920 --> 01:09:47,000
Speaker 1: who used to be their own personal stock picker and

1298
01:09:47,080 --> 01:09:48,960
Speaker 1: what was an et F. I mean, you know, you

1299
01:09:49,080 --> 01:09:52,439
Speaker 1: interviewed the king of ETFs yourself, and it's all it's

1300
01:09:52,479 --> 01:09:54,720
Speaker 1: went now to basically people buy e t F. So

1301
01:09:55,600 --> 01:09:58,120
Speaker 1: you get volatility with that because with click trading, you

1302
01:09:58,280 --> 01:10:02,640
Speaker 1: you dump positions. You know, we're just just sporadically. So

1303
01:10:02,760 --> 01:10:04,920
Speaker 1: it's it's a lot harder an t F and you're

1304
01:10:04,960 --> 01:10:08,479
Speaker 1: essentially dumping a hundred stocks exactly, and and then people

1305
01:10:08,520 --> 01:10:10,599
Speaker 1: do it. The psychology the market comes in, you get

1306
01:10:10,640 --> 01:10:13,840
Speaker 1: the greed, and greed very powerful emotion. We've seen the

1307
01:10:14,200 --> 01:10:16,240
Speaker 1: Dow came off a thousand points here, you know, just

1308
01:10:16,520 --> 01:10:19,360
Speaker 1: after the Brexit, you know, and that's it's a fear trade.

1309
01:10:19,960 --> 01:10:23,320
Speaker 1: And so I think it's harder to be a stock picker,

1310
01:10:23,800 --> 01:10:26,960
Speaker 1: you know, to to find deep value and to have

1311
01:10:27,160 --> 01:10:31,679
Speaker 1: disproportionate benefit. So you need to be is a money manager.

1312
01:10:31,720 --> 01:10:33,599
Speaker 1: I think you need to be long and short. It's

1313
01:10:33,880 --> 01:10:35,960
Speaker 1: very hard to be long only. And one of my

1314
01:10:36,120 --> 01:10:37,880
Speaker 1: one of my mentors in Germany told me says, when

1315
01:10:38,360 --> 01:10:40,280
Speaker 1: me and traditionally I'm a value investor, so I am

1316
01:10:40,360 --> 01:10:42,800
Speaker 1: long only, and he says the difference between people like

1317
01:10:42,920 --> 01:10:45,240
Speaker 1: you and me. He says, I make money every day.

1318
01:10:45,439 --> 01:10:46,880
Speaker 1: I don't care if the market's going up or down.

1319
01:10:47,200 --> 01:10:49,080
Speaker 1: I just I just need to be right more times

1320
01:10:49,120 --> 01:10:51,560
Speaker 1: that I'm wrong. And he says, you you have you

1321
01:10:51,680 --> 01:10:54,080
Speaker 1: wait and wait, and I said, the way my heart beats,

1322
01:10:54,160 --> 01:10:56,439
Speaker 1: I'm okay with that. I want to find deep value.

1323
01:10:56,479 --> 01:10:58,559
Speaker 1: I want to get behind I have conviction as long

1324
01:10:58,600 --> 01:11:00,320
Speaker 1: as I'm not wrong. Because you a SOO have to

1325
01:11:00,360 --> 01:11:03,479
Speaker 1: admit when the facts change, so should you. If you're wrong,

1326
01:11:04,000 --> 01:11:06,560
Speaker 1: get off the trade, you know. But typically I have

1327
01:11:06,640 --> 01:11:08,439
Speaker 1: a window of maybe one to five years. I want

1328
01:11:08,479 --> 01:11:10,920
Speaker 1: to get behind a theme and uh and ride that

1329
01:11:11,000 --> 01:11:14,240
Speaker 1: pony all the way. So what do you see as

1330
01:11:14,320 --> 01:11:17,400
Speaker 1: some of the next major shifts taking place in in

1331
01:11:17,560 --> 01:11:22,439
Speaker 1: that space, either in in public markets or venture investment. Well,

1332
01:11:22,479 --> 01:11:25,479
Speaker 1: let's talk about the the largest traded commodity in the world.

1333
01:11:25,560 --> 01:11:28,840
Speaker 1: Let's talk about oil, which is a huge market and

1334
01:11:29,280 --> 01:11:31,120
Speaker 1: it's going through a tectonic shift. And let me just

1335
01:11:31,560 --> 01:11:34,360
Speaker 1: give people some anecdotal information for those that are not

1336
01:11:34,640 --> 01:11:38,720
Speaker 1: energy experts. We use today nine s million barrels a

1337
01:11:38,800 --> 01:11:42,640
Speaker 1: day demand. And if you look at the prognosticators and

1338
01:11:42,720 --> 01:11:44,840
Speaker 1: you ask them fifteen years ago or ten years ago.

1339
01:11:45,160 --> 01:11:46,880
Speaker 1: How much oil are we going to use in the future.

1340
01:11:47,200 --> 01:11:49,320
Speaker 1: All the charts end up going into the future to

1341
01:11:49,439 --> 01:11:52,640
Speaker 1: about a hundred twenty million barrels a day. Hundred in

1342
01:11:52,680 --> 01:11:57,080
Speaker 1: the future maybe not. The way we use oil is

1343
01:11:57,160 --> 01:12:01,280
Speaker 1: so fundamentally changed. We are now things that you consume

1344
01:12:01,479 --> 01:12:03,519
Speaker 1: of this ninety six million barrels a day, there are

1345
01:12:03,640 --> 01:12:05,519
Speaker 1: there are applications that are going to go to zero

1346
01:12:05,640 --> 01:12:09,640
Speaker 1: oil consumption, zero adoption. Five million barrels a day is

1347
01:12:09,680 --> 01:12:12,360
Speaker 1: used to make electricity on islands around the world. You

1348
01:12:12,439 --> 01:12:15,880
Speaker 1: look at the fines that were levied three weeks ago

1349
01:12:15,920 --> 01:12:18,880
Speaker 1: by the European Union of all the Lorry, the semi

1350
01:12:18,920 --> 01:12:23,360
Speaker 1: truck manufacturers billions of dollars because their efficiencies did not

1351
01:12:23,520 --> 01:12:27,160
Speaker 1: go down in twenty five years. In four years, Barry,

1352
01:12:27,280 --> 01:12:32,120
Speaker 1: they're going to use less fuel? Is that? What is

1353
01:12:32,200 --> 01:12:34,639
Speaker 1: the is the key fact? It's a two prong effect.

1354
01:12:34,720 --> 01:12:36,759
Speaker 1: For they're making them change the shape of the trucks

1355
01:12:36,920 --> 01:12:39,519
Speaker 1: so they're gonna be aerodynamic European semi trucks, as everyone

1356
01:12:39,600 --> 01:12:42,880
Speaker 1: knows how that big square, very un aerodynamic shape that

1357
01:12:42,920 --> 01:12:45,240
Speaker 1: will that will go to be an aerodynamic shape, which

1358
01:12:45,320 --> 01:12:47,840
Speaker 1: will have We've we've seen a lot of adaptations to

1359
01:12:48,240 --> 01:12:50,360
Speaker 1: here here we have it. Not in Europe though, really not.

1360
01:12:50,720 --> 01:12:53,679
Speaker 1: You would think that gasoline is so much more expensive

1361
01:12:53,720 --> 01:12:57,519
Speaker 1: there that would be a being automatic. I'm actually looking

1362
01:12:57,640 --> 01:13:00,640
Speaker 1: for something right now as we're as we're talking about it,

1363
01:13:00,680 --> 01:13:02,960
Speaker 1: but I'm not so that's going to change. And then

1364
01:13:03,000 --> 01:13:05,240
Speaker 1: we look at the the the automobiles that are used

1365
01:13:05,240 --> 01:13:08,000
Speaker 1: eighteen hours a day, which is not not you and

1366
01:13:08,120 --> 01:13:12,880
Speaker 1: I taxis the urban transports, buses, the world's largest automobile market,

1367
01:13:12,920 --> 01:13:15,600
Speaker 1: which is China. Boy, this that industry is changing in

1368
01:13:15,600 --> 01:13:18,280
Speaker 1: the next four or five years. It's a line item.

1369
01:13:18,800 --> 01:13:22,920
Speaker 1: So conclusively, we're gonna use less oil. If people talk

1370
01:13:22,920 --> 01:13:25,920
Speaker 1: about the fracking revolution in the United States, so we

1371
01:13:25,960 --> 01:13:28,080
Speaker 1: know that the drill rigs went from about two D

1372
01:13:28,320 --> 01:13:31,000
Speaker 1: six hundred and four years and what happened is we

1373
01:13:31,120 --> 01:13:34,280
Speaker 1: ended up having almost six million barrels of new production.

1374
01:13:35,240 --> 01:13:37,720
Speaker 1: This is unprecedented. And then you look at it, well,

1375
01:13:37,760 --> 01:13:39,960
Speaker 1: what about the demand side, because the world's growing and

1376
01:13:40,000 --> 01:13:42,720
Speaker 1: there's India and all these other places. Let's look at

1377
01:13:42,760 --> 01:13:46,240
Speaker 1: the fastest growing energy market in history, China. It took

1378
01:13:46,320 --> 01:13:50,360
Speaker 1: them fifteen years to have five million barrels of new demand.

1379
01:13:51,080 --> 01:13:55,599
Speaker 1: So this this revolution of how we extract oil. It's

1380
01:13:55,680 --> 01:13:59,320
Speaker 1: it's it's not offset by demand. It's slowing down. We

1381
01:13:59,439 --> 01:14:02,639
Speaker 1: used to grow three four percent a year annual oil demand.

1382
01:14:03,320 --> 01:14:06,439
Speaker 1: We're coming in it's it's barely growing, it's maybe a percent.

1383
01:14:07,439 --> 01:14:10,360
Speaker 1: What about the concept and I'm trying to remember which

1384
01:14:10,439 --> 01:14:14,600
Speaker 1: Saudi king said this um and the quote is you

1385
01:14:14,680 --> 01:14:18,040
Speaker 1: know you Americans waste oil using it as a fuel,

1386
01:14:18,240 --> 01:14:21,640
Speaker 1: meaning it's real value is in the materials world and

1387
01:14:21,720 --> 01:14:24,519
Speaker 1: as a basis for plastics and polymers and what have you.

1388
01:14:25,720 --> 01:14:29,560
Speaker 1: How much of a demand for oil exists on not

1389
01:14:29,720 --> 01:14:32,320
Speaker 1: on the energy side, but on the material side. And

1390
01:14:32,400 --> 01:14:35,760
Speaker 1: what does that mean going going forward? Yeah, that's gonna

1391
01:14:36,280 --> 01:14:38,519
Speaker 1: there is demand for that obviously to make plastics and

1392
01:14:38,680 --> 01:14:41,400
Speaker 1: in certain products we we use petroleum, you know, the

1393
01:14:41,560 --> 01:14:44,760
Speaker 1: petroleum industry, But that's not the lion's share of where

1394
01:14:44,800 --> 01:14:48,040
Speaker 1: oil is consumed. Oil is consumed in mode of transportation,

1395
01:14:48,280 --> 01:14:51,719
Speaker 1: and it's changing. And we saw the oil price collapse

1396
01:14:51,880 --> 01:14:54,800
Speaker 1: in the past eighteen months because of a two million

1397
01:14:54,880 --> 01:15:00,240
Speaker 1: barrel a day shifted displacement too much supply. So if

1398
01:15:00,280 --> 01:15:02,320
Speaker 1: I'm talking about all these things I just talked about,

1399
01:15:02,360 --> 01:15:04,960
Speaker 1: I'm talking about a displacement of two three five million

1400
01:15:05,000 --> 01:15:09,360
Speaker 1: barrels a day in the next two five fifteen years. Well,

1401
01:15:10,240 --> 01:15:12,040
Speaker 1: and at the same time you can extract more oil.

1402
01:15:12,560 --> 01:15:14,640
Speaker 1: I like to tell people that of the six or

1403
01:15:14,680 --> 01:15:18,040
Speaker 1: seven factors that can influence the price of oil, I

1404
01:15:18,240 --> 01:15:22,200
Speaker 1: think that that industry, the oil industry, relies overweight now

1405
01:15:22,360 --> 01:15:27,920
Speaker 1: on toxic geopolitics, because there's always it could be maybe

1406
01:15:27,960 --> 01:15:31,200
Speaker 1: forty of politics in a barrel of oil. If things

1407
01:15:31,280 --> 01:15:35,080
Speaker 1: go awry in a really sensitive oil environment, you should

1408
01:15:35,160 --> 01:15:37,960
Speaker 1: have or you could have an increase in oil prices.

1409
01:15:38,560 --> 01:15:41,240
Speaker 1: It does not rely on fundamentals anymore because across the

1410
01:15:41,280 --> 01:15:45,400
Speaker 1: board innovation, adoption, technology we are going to use in

1411
01:15:45,479 --> 01:15:49,240
Speaker 1: the future less oil. My friend Gary Shilling has a

1412
01:15:49,320 --> 01:15:51,800
Speaker 1: ten dollar a barrel price target. I don't I don't

1413
01:15:51,800 --> 01:15:55,200
Speaker 1: really do price targets, but that certainly gets your attention.

1414
01:15:56,200 --> 01:15:59,040
Speaker 1: Long term, he's in the same camp as you. Hey,

1415
01:15:59,720 --> 01:16:04,000
Speaker 1: this as an energy source, it's certainly if it's not

1416
01:16:04,439 --> 01:16:07,760
Speaker 1: a twilight industry, it certainly has peaked. And as we

1417
01:16:07,880 --> 01:16:12,439
Speaker 1: see more tesla's and more electrical adaptation, there's going to

1418
01:16:12,520 --> 01:16:16,240
Speaker 1: be less and less UH oil consumption. Even if we

1419
01:16:16,360 --> 01:16:21,840
Speaker 1: continue using gasoline powered cars as they become autonomous. They're

1420
01:16:21,840 --> 01:16:25,559
Speaker 1: gonna become so much more fuel efficient than us humans

1421
01:16:25,600 --> 01:16:30,040
Speaker 1: are are driving. It's gotta take a huge bite out

1422
01:16:30,080 --> 01:16:32,880
Speaker 1: of the total demand that's out there. Yeah, they're gonna

1423
01:16:32,960 --> 01:16:35,280
Speaker 1: they're gonna be electric. Even if let's let's assume right

1424
01:16:35,320 --> 01:16:38,200
Speaker 1: now we don't sell one an electric car. We're gonna

1425
01:16:38,200 --> 01:16:40,000
Speaker 1: we're gonna sell more cars in the future, more people

1426
01:16:40,040 --> 01:16:42,560
Speaker 1: consuming more things. We can all agree to that. But

1427
01:16:42,720 --> 01:16:44,640
Speaker 1: cars are mandated here in the United States to go

1428
01:16:44,720 --> 01:16:47,920
Speaker 1: from miles a gallon to fifty four miles a gallon.

1429
01:16:48,000 --> 01:16:52,080
Speaker 1: By that's the fleet sales for all of GM, all

1430
01:16:52,160 --> 01:16:56,719
Speaker 1: of Mercedes, all of Toyota, their entire fleet has that average.

1431
01:16:56,760 --> 01:16:59,360
Speaker 1: You use more or less oil in that atmosphere. Clearly,

1432
01:16:59,760 --> 01:17:03,240
Speaker 1: my less thank you. If the lorry manufacturers of Europe

1433
01:17:03,240 --> 01:17:05,680
Speaker 1: are going to have to have more efficiency between now

1434
01:17:05,720 --> 01:17:07,599
Speaker 1: and are they going to use more or less oil

1435
01:17:07,640 --> 01:17:11,439
Speaker 1: in that atmosphere? If we if half the islands around

1436
01:17:11,479 --> 01:17:16,240
Speaker 1: the world that make electricity from bunker start using being diesel,

1437
01:17:16,680 --> 01:17:18,600
Speaker 1: cheap diesel to make electricity, or we're gonna you know,

1438
01:17:19,560 --> 01:17:22,160
Speaker 1: it's it's basic arithmetic. The ships around the world are

1439
01:17:22,160 --> 01:17:25,080
Speaker 1: becoming more efficient. I mean just in the past twelve years, Barry,

1440
01:17:25,160 --> 01:17:29,120
Speaker 1: the average airplane and car is about more fuel efficient.

1441
01:17:29,520 --> 01:17:31,400
Speaker 1: Now the trucks are coming next, because the number they

1442
01:17:31,439 --> 01:17:33,400
Speaker 1: just got the wrist slapped that three weeks ago that

1443
01:17:33,479 --> 01:17:36,880
Speaker 1: these charge collusion charges have went went against them, which

1444
01:17:36,920 --> 01:17:40,320
Speaker 1: is why they too have a siren on that program.

1445
01:17:40,880 --> 01:17:43,360
Speaker 1: And then of course the grandaddy of them all urban

1446
01:17:43,400 --> 01:17:48,080
Speaker 1: transport buses that operates six eighteen hours a day going electric.

1447
01:17:48,560 --> 01:17:50,920
Speaker 1: Now we'd have to focus about the small markets that

1448
01:17:51,000 --> 01:17:54,960
Speaker 1: are that aren't approaching this from a progressive point of view.

1449
01:17:55,320 --> 01:17:57,040
Speaker 1: We have to go to the world's largest market, which

1450
01:17:57,120 --> 01:18:01,519
Speaker 1: is doing this very quickly. So our fall anal two questions,

1451
01:18:01,560 --> 01:18:05,880
Speaker 1: our favorite questions. First, if a millennial or recent college

1452
01:18:05,920 --> 01:18:08,559
Speaker 1: graduate came up to you and ask for some career advice,

1453
01:18:08,880 --> 01:18:12,600
Speaker 1: what would you tell them, Well, let's let's pretend there

1454
01:18:12,600 --> 01:18:16,960
Speaker 1: are my brother's children, so I really, I really admire

1455
01:18:17,040 --> 01:18:20,000
Speaker 1: this millennial I'm talking to. I would take them by

1456
01:18:20,040 --> 01:18:22,280
Speaker 1: the hand, and I would sit down and I would

1457
01:18:22,320 --> 01:18:27,479
Speaker 1: really explain fundamentally how energy is the umbilical court of

1458
01:18:27,560 --> 01:18:30,880
Speaker 1: human progress, how it's changing, how we create, transfer, and

1459
01:18:30,960 --> 01:18:33,639
Speaker 1: utilize that energy. Of course they'll come to the conclusion

1460
01:18:33,680 --> 01:18:36,840
Speaker 1: that it's all electricity, and I would say, open up

1461
01:18:36,880 --> 01:18:40,920
Speaker 1: your mind. Maybe it's electrical design, maybe it's engineering, maybe

1462
01:18:40,960 --> 01:18:44,160
Speaker 1: it's the software technology. But you need to embrace that.

1463
01:18:44,320 --> 01:18:46,400
Speaker 1: You need to have you need to know the fundamentals.

1464
01:18:46,439 --> 01:18:48,960
Speaker 1: If you cut all this stuff in half, this green

1465
01:18:49,120 --> 01:18:51,960
Speaker 1: energy that so many young people want, if you cut

1466
01:18:52,000 --> 01:18:54,439
Speaker 1: it in half, you need to know how it works,

1467
01:18:54,520 --> 01:18:58,200
Speaker 1: how it functions, how can you make it better? And maybe,

1468
01:18:58,479 --> 01:19:00,479
Speaker 1: just maybe those people can change the world. We need

1469
01:19:00,560 --> 01:19:04,000
Speaker 1: to inspire a generation of young people berry to go

1470
01:19:04,120 --> 01:19:07,760
Speaker 1: to university with pride and take science, technology, engineering, and

1471
01:19:07,880 --> 01:19:10,200
Speaker 1: math like so many other people around the world. That's

1472
01:19:10,240 --> 01:19:13,320
Speaker 1: the advice I would give a millennial. And our final question,

1473
01:19:13,640 --> 01:19:17,400
Speaker 1: what is it that you know about technology, energy, venture

1474
01:19:17,400 --> 01:19:21,320
Speaker 1: investing today that you wish you knew fifteen years ago?

1475
01:19:22,880 --> 01:19:25,360
Speaker 1: I wish I had a degree in psychology because it

1476
01:19:25,439 --> 01:19:29,160
Speaker 1: makes you understand markets so much more. You know these

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01:19:29,200 --> 01:19:32,720
Speaker 1: emotions of fear and greed. You know this this euphoria

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01:19:32,800 --> 01:19:35,200
Speaker 1: that hits markets when you think you're a genius because

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01:19:35,240 --> 01:19:37,160
Speaker 1: you're making money in the stocks you chose are all

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01:19:37,200 --> 01:19:41,560
Speaker 1: going higher. Now, if you understood psychology, you you you

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01:19:41,760 --> 01:19:44,720
Speaker 1: it's going to help you as an investor. So if

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01:19:44,760 --> 01:19:47,000
Speaker 1: I if I knew more, and I do study this

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01:19:47,040 --> 01:19:50,000
Speaker 1: stuff now just as a passive sort of fan of

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01:19:50,280 --> 01:19:54,519
Speaker 1: of how markets are. So I don't want to use

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01:19:54,520 --> 01:19:58,759
Speaker 1: the word manipulated, but move driven, driven by by emotion.

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01:19:59,320 --> 01:20:01,599
Speaker 1: If you understand that better you're gonna have, you're gonna

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01:20:01,600 --> 01:20:05,000
Speaker 1: add a few percentage points to your performance every year. Giohnny,

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01:20:05,120 --> 01:20:07,759
Speaker 1: this has been terrific. Thank you for being so generous

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01:20:07,800 --> 01:20:11,600
Speaker 1: with your time. We have been speaking with Giohnny Kovachevik,

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01:20:12,080 --> 01:20:16,120
Speaker 1: author of My Electrician Drives a Porsche, investing in the

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01:20:16,360 --> 01:20:21,200
Speaker 1: rise of the new spending class. If you enjoyed this conversation,

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01:20:21,360 --> 01:20:23,160
Speaker 1: be sure and look up an inch or down an

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01:20:23,200 --> 01:20:25,719
Speaker 1: inch and you could see any of the other nineties

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01:20:25,720 --> 01:20:29,800
Speaker 1: seven or so. Uh, such conversations we've had. I know

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01:20:30,080 --> 01:20:33,800
Speaker 1: this sounds like a conversation just between two people, but

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01:20:34,040 --> 01:20:38,000
Speaker 1: a team of folks helped put this together. Uh. Taylor

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01:20:38,080 --> 01:20:43,240
Speaker 1: Riggs is our scheduler slash booker, Charlie Vollmer is our producer,

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01:20:43,600 --> 01:20:47,000
Speaker 1: Mark is our recording engineer. Mike Batnick is the head

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01:20:47,040 --> 01:20:50,439
Speaker 1: of research. And you're gonna actually I need you to

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01:20:50,520 --> 01:20:53,240
Speaker 1: sign this book to Mike Batnick, who gave you a

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01:20:53,320 --> 01:20:58,040
Speaker 1: fantastic review on Amazon. Um, so before I forget, I

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01:20:58,080 --> 01:21:00,479
Speaker 1: have to have you sign a book for him. Uh.

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01:21:01,120 --> 01:21:05,040
Speaker 1: Thank you for everybody for helping make this program such

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01:21:05,080 --> 01:21:08,599
Speaker 1: a delight to do and to listen to. I'm Barry Ridolts.

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01:21:08,760 --> 01:21:12,240
Speaker 1: You've been listening to Masters in Business on Bloomberg Radio,

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01:21:15,400 --> 01:21:18,720
Speaker 1: brought to you by B A s F. We create chemistry.