WEBVTT - Surveillance: 18 Years On, Remembering 9/11 0:00:09.880 --> 0:00:13.800 Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane Jay Ley. 0:00:13.960 --> 0:00:17.560 We bring you insight from the best in economics, finance, investment, 0:00:18.000 --> 0:00:23.520 and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 0:00:23.600 --> 0:00:28.240 Bloomberg dot Com, and of course on the Bloomberg. Right now, 0:00:28.280 --> 0:00:30.160 thom Ma's take a look at an interesting story. I 0:00:30.240 --> 0:00:33.639 guess some former chiefs of the Homeland Security suggesting that 0:00:33.960 --> 0:00:37.760 some of the use of the Homeland Security UH Department 0:00:38.120 --> 0:00:41.960 for border politics is creating some issues. To give us 0:00:41.960 --> 0:00:44.200 a sense of what's going on there, we welcome Michael Ross. 0:00:44.720 --> 0:00:48.400 Michaelis Bloomberg Government Homeland Security reporters. So Mchael give us 0:00:48.440 --> 0:00:50.720 a sense of kind of some of the issues srolling 0:00:50.720 --> 0:00:54.720 around the Homeland Security Department. Absolutely, good morning to you both, 0:00:54.720 --> 0:00:57.400 and I join you actually just a few yards from 0:00:57.400 --> 0:00:59.880 the Pentagon this morning at the T s A headquarters 0:01:00.160 --> 0:01:03.360 where we are also commemorating these moments of nine allove 0:01:03.400 --> 0:01:06.240 input is a very somber moment here that I'm joining 0:01:06.240 --> 0:01:09.200 you from. And but earlier this week I was in 0:01:09.280 --> 0:01:12.200 New York. We were at the nine eleven Memorial and 0:01:12.280 --> 0:01:15.720 Museum with some of the former heads the former secretaries 0:01:15.760 --> 0:01:18.840 of the the department that launched because of this day. 0:01:18.880 --> 0:01:21.960 The Department of Coman Security UM is definitely the startup 0:01:21.959 --> 0:01:24.920 out of this and UH, they were several of them 0:01:24.959 --> 0:01:29.759 expressed concerns, deep concerns that eighteen years after the fact, 0:01:30.080 --> 0:01:33.520 that there is more issues that are dividing the department 0:01:33.640 --> 0:01:36.480 politically and making it more difficult for the department to 0:01:36.600 --> 0:01:42.160 function in the private sector. Mc Garrett Graff who had 0:01:42.200 --> 0:01:43.560 my book of the Year a few years ago in 0:01:43.600 --> 0:01:46.200 the FBI, and Mr Mueller has a wonderful new book out. 0:01:46.240 --> 0:01:50.520 It is a visceral book of interviews of September eleven 0:01:51.160 --> 0:01:56.040 and permean permeating that is somewhat the cacophony in Washington. 0:01:56.200 --> 0:01:59.320 Jonathan Bernstein and Bloomberg Opinion calls it the pure chaos 0:02:00.000 --> 0:02:03.040 off of Mr Bolton's resignation. And within all of this, 0:02:03.280 --> 0:02:07.600 the periphery is Homeland Security. What's the state of the 0:02:07.640 --> 0:02:11.600 department right now? How would you frame that? What's the 0:02:11.639 --> 0:02:14.400 concern is that we're hearing from ammakers on both sides 0:02:14.440 --> 0:02:17.760 of the aisle as well as UH former officials, is 0:02:17.800 --> 0:02:20.160 that it is getting more difficult for the department to 0:02:20.160 --> 0:02:23.000 accomplish his goals in some ways, or I should say 0:02:23.160 --> 0:02:27.520 that such such a such a focus on immigration enforcement, 0:02:27.800 --> 0:02:31.520 they fear is making taking resources away from a lot 0:02:31.520 --> 0:02:34.600 of the other missions. Again, the Department was formed out 0:02:34.600 --> 0:02:36.920 of this terrorist attack. It was formed to try to 0:02:36.919 --> 0:02:40.040 try to keep the homeland safe. It has so many 0:02:40.080 --> 0:02:43.400 missions between t s A and SEMA and the Secret 0:02:43.440 --> 0:02:47.040 Service and the Coast Guard and cybersecurity, and yet the 0:02:47.080 --> 0:02:49.520 bulk of that of the bulk of its energy right 0:02:49.560 --> 0:02:53.160 now is in those immigration enforcement agencies. And there's worried 0:02:53.200 --> 0:02:55.480 that UM there might be other threats that aren't getting 0:02:55.480 --> 0:02:58.120 as much attention. There's where the resources might not be 0:02:58.200 --> 0:03:00.399 getting to what they need to be, and there's word 0:03:00.440 --> 0:03:04.040 that there's is causing division. So MICHAELA. As the Department 0:03:04.080 --> 0:03:06.920 makes its concerns known, what has been the response so 0:03:07.040 --> 0:03:12.040 far from Congress? UH and Congresses? We were just with 0:03:12.520 --> 0:03:17.919 several of the House Homeland Security Committee yesterday. They are 0:03:18.440 --> 0:03:21.560 the different very upset. Actually, in a separate incident, some 0:03:21.639 --> 0:03:25.000 of the top officials and the Trump administration UM at 0:03:25.040 --> 0:03:28.840 first refused and then delayed an hearing about global threats 0:03:28.880 --> 0:03:31.000 that the committee has ever year to try to hear about. 0:03:31.240 --> 0:03:32.359 You know what they need to do to try to 0:03:32.400 --> 0:03:33.799 make the department better and what they needed to do 0:03:33.919 --> 0:03:36.800 to try to address some of those threats. So UM, 0:03:37.000 --> 0:03:40.200 both types of the aisle again very concerned UM that 0:03:40.720 --> 0:03:45.000 some top Trump officials, including the Acting Secretary of Homeland Security. UM, 0:03:45.120 --> 0:03:49.280 we're not able to satisfy the time UM now that 0:03:49.400 --> 0:03:52.240 has been rescheduled of course, UM to try to talk 0:03:52.280 --> 0:03:55.920 about some of these threats with the homeland So it's 0:03:55.960 --> 0:03:59.440 interesting the is there a sense what is kind of 0:03:59.440 --> 0:04:02.000 the gas concern on the part of the Department of 0:04:02.000 --> 0:04:04.880 Homeland Security about what they're being test to do an 0:04:04.920 --> 0:04:08.440 immigration is that manpower? Is it other resources that are 0:04:08.440 --> 0:04:12.040 being diverted? What's really the big issue for them? The 0:04:12.080 --> 0:04:15.640 big issue on immigration enforcement coming into the fall, of course, 0:04:15.760 --> 0:04:17.960 is going to be the refocus on the border wall, 0:04:18.320 --> 0:04:21.240 which is definitely a top priority of the Trump administration. 0:04:21.480 --> 0:04:23.560 But that is going to be another issue that's really 0:04:23.600 --> 0:04:26.440 going to divide Congress because we're looking at all of 0:04:26.440 --> 0:04:28.480 the spending bills that need to be passed within the 0:04:28.480 --> 0:04:30.880 next UM well a few weeks to try to try 0:04:30.880 --> 0:04:33.359 to get it in on time, but this fall, UM 0:04:33.440 --> 0:04:35.359 to avoid a shutdown, and at the heart of that 0:04:35.520 --> 0:04:37.920 is going to be this issue of trying to stem 0:04:37.960 --> 0:04:41.600 the flow of immigrants coming from the Southwest border. McKenna ross, 0:04:41.600 --> 0:04:44.839 thank you so much. Border politics hurting homeland security to 0:04:44.839 --> 0:04:47.479 say the least, as well. Good to hear from her 0:04:47.480 --> 0:04:50.880 from t s A near the Pentagon on this September 0:04:51.760 --> 0:05:08.400 ele Right now, we're gonna she's not an intensive care 0:05:08.520 --> 0:05:11.159 She's been working through the morning from London on the 0:05:11.240 --> 0:05:14.880 London perspective of the Hong Kong Stock Exchange effort, a 0:05:15.000 --> 0:05:20.000 shock effort to purchase the LSE, and she is Sarah said, Sarah, 0:05:20.040 --> 0:05:22.800 Let's look at the stock price up x percent, double 0:05:22.839 --> 0:05:25.520 digit and it's given it back with a vengeance in 0:05:25.560 --> 0:05:29.320 the last hour. Why is that? Well, I think there's 0:05:29.360 --> 0:05:32.440 a certainly an interesting offer that's been been put on 0:05:32.480 --> 0:05:34.880 the table. I mean, you know, the ELSE had given 0:05:35.000 --> 0:05:39.400 anyone that was interested in acquiring the business a short 0:05:39.520 --> 0:05:43.240 window to make an offer after it had made the 0:05:43.279 --> 0:05:46.719 announcement that it was looking to tie up with the 0:05:46.720 --> 0:05:51.440 filmer Thompson Royds's business um Refinitive. Now you know, after 0:05:51.960 --> 0:05:54.160 you know, if a deal with Refinitive would have gone through, 0:05:54.240 --> 0:05:57.560 it would make the l SE almost unaffordable. So you know, 0:05:57.600 --> 0:06:00.640 the else had ultimately it's become open, is not Elsie, 0:06:00.640 --> 0:06:02.480 but they'd give you a bit as a short window 0:06:02.560 --> 0:06:04.600 to come in and try and make that offer, which 0:06:04.880 --> 0:06:07.520 which you know Hong Kong has coming down right. And 0:06:07.560 --> 0:06:10.520 then it's cultural as well. This is a Mary Poppins. 0:06:10.600 --> 0:06:15.119 It's not railways to India, it's the Chinese are coming 0:06:15.160 --> 0:06:17.080 into buy London. I mean, that's a blunt way to 0:06:17.080 --> 0:06:19.919 put it. I don't mean any aspersion there, but Sarah, 0:06:20.200 --> 0:06:25.360 there's a whole cultural and political overlay to this transaction, 0:06:25.400 --> 0:06:28.680 this proposed transaction. I mean, there'd be an under understatement 0:06:28.720 --> 0:06:31.400 to say that that, you know, the deal is super 0:06:32.279 --> 0:06:34.960 politically sensitive. That's what it is at the moment. You know, 0:06:35.040 --> 0:06:38.599 you have the Hong Kong protests um, you know, going 0:06:38.640 --> 0:06:41.839 on and and continue, and then of course you've got 0:06:41.839 --> 0:06:45.520 breaks it and and the falling the drop in in 0:06:45.520 --> 0:06:47.479 in Sterling, so you know, there are a lot of 0:06:47.480 --> 0:06:51.200 politically sensitive issues. The we had Andrea Ledson this morning, 0:06:51.520 --> 0:06:54.440 you know, whilst we while Francine was interviewing her her 0:06:54.520 --> 0:06:57.040 this morning and the announcement came, she said that they 0:06:57.080 --> 0:07:00.160 would look at any deal, but there would s may 0:07:00.200 --> 0:07:04.960 be close scrutiny from the UK government on on any 0:07:05.000 --> 0:07:09.239 deal of this scale, certainly from the Chinese. So Sarah, 0:07:09.240 --> 0:07:11.840 what is just the status of the definitive deal that 0:07:11.880 --> 0:07:15.120 was announced recently. Well, it's it's been announced but certainly 0:07:15.200 --> 0:07:18.920 not closed UM, and and that process is still ongoing. 0:07:19.120 --> 0:07:23.640 So you know, this is where other bidders are interested in. 0:07:23.680 --> 0:07:26.000 The LSE had this short window to come in and 0:07:26.000 --> 0:07:29.920 try and scumper that, and the Hong Kong Stock Exchange 0:07:29.920 --> 0:07:34.080 has said that any deal UM with Hong Kong Stock 0:07:34.120 --> 0:07:38.080 Exchange and l s UM is premised on the refinitive 0:07:38.120 --> 0:07:42.640 transaction not proceeding, and that I would guess mainly has 0:07:42.680 --> 0:07:45.440 to do with the fact that the Hong Kong Stock 0:07:45.440 --> 0:07:48.880 Exchange would not be able to afford the LSU should 0:07:48.880 --> 0:07:52.480 the refinitive transaction go through. Sarah, thank you so much, 0:07:52.520 --> 0:07:56.160 particularly through the morning here, Sarah said, with us in 0:07:56.480 --> 0:08:00.920 London on this proposed transaction, Hong Kong to buy London, 0:08:15.200 --> 0:08:17.360 we can go to LuSE Group and there Doug Ramsey, 0:08:17.360 --> 0:08:20.440 Handsome Doug Ramsey with us this morning. Doug, I love 0:08:20.520 --> 0:08:23.960 your note. We're all economists now. Is that really what 0:08:24.000 --> 0:08:27.720 your world has come down to? It seems like it. 0:08:27.800 --> 0:08:30.520 I mean, it seems like the uh, the economic bulls 0:08:30.520 --> 0:08:33.280 and the stock market bulls are now one and the same, 0:08:33.600 --> 0:08:36.280 and uh, you know, we continue to cause investors they're 0:08:36.360 --> 0:08:38.720 they're not always the same. I mean, think back to 0:08:39.160 --> 0:08:41.959 that great top of March of two thousand. We put 0:08:42.040 --> 0:08:44.920 in a market top that led to a forty nine 0:08:44.960 --> 0:08:47.800 and a half percent decline in the SMP five and 0:08:48.120 --> 0:08:51.640 the economy did not sink into recession until eleven months later. 0:08:52.720 --> 0:08:55.920 So it's certainly possible that something like that could happen again. 0:08:56.000 --> 0:09:00.880 But you know, the two can can disconnect. This areods, Doug? 0:09:00.960 --> 0:09:03.760 Is this the time to uh for the Tom and 0:09:03.800 --> 0:09:06.080 I we talked about we're value stock investors. This the 0:09:06.120 --> 0:09:07.960 time for value stocks to shine. Here the ones in 0:09:07.960 --> 0:09:13.200 a decade opportunity. I don't know if this is the turn. 0:09:13.800 --> 0:09:18.240 I mean, it seems, uh, it seems unlikely to mean 0:09:18.280 --> 0:09:21.120 it wasn't. Remember it's not just you know, growth versus 0:09:21.240 --> 0:09:26.640 value and momentum versus value. It it's everything that was 0:09:26.760 --> 0:09:33.120 working versus everything that was not. And I mean from 0:09:33.400 --> 0:09:37.400 low voll versus high beta, commodity versus consumer, that sort 0:09:37.440 --> 0:09:39.000 of thing. And I just find it hard to believe 0:09:39.080 --> 0:09:41.920 you're gonna have a watershed day where all of those 0:09:41.960 --> 0:09:46.720 relationships where one week ago, I mean, the fundamental conviction 0:09:46.760 --> 0:09:50.840 that nearly every strategist had for those trends to remain 0:09:50.840 --> 0:09:54.720 in place. Uh, it's amazing how the narrative has flipped 0:09:54.880 --> 0:09:58.600 with just two days action. So I don't think it's 0:09:58.600 --> 0:10:02.680 going to be a turn in all of those binary 0:10:02.720 --> 0:10:05.800 relations Can I just point evaluations that could, Paul? Can 0:10:05.840 --> 0:10:08.680 I just point out the Dow closed at twenty six thousand, 0:10:08.840 --> 0:10:11.640 nine nine. I mean, if this is this is a 0:10:11.760 --> 0:10:15.280 Ramsey correction, this is a Ramsey crac So again, as 0:10:15.280 --> 0:10:17.480 Tom mentioned here, you know we're at our very near 0:10:17.559 --> 0:10:21.559 these all time highs, despite trade, despite all the geopolitical 0:10:21.559 --> 0:10:25.320 issues in the world equity wise, what is your view 0:10:25.320 --> 0:10:28.839 of the market right here? Well, our view is that 0:10:28.960 --> 0:10:32.920 the last nineteen months have been a a broad uh 0:10:33.120 --> 0:10:37.520 global topping process. And remember, on the basis of the ACQUI, 0:10:38.080 --> 0:10:40.920 we are not the all country world index. We are 0:10:40.960 --> 0:10:43.480 not back two new highs. And if you look at 0:10:43.480 --> 0:10:46.600 sort of the average stock whether globally or within the US, 0:10:47.280 --> 0:10:50.559 on the basis of like the value line arithmetic index, 0:10:50.880 --> 0:10:54.280 excellent measure that's basically, the average performance of the U 0:10:54.320 --> 0:10:57.480 S stock nowhere near a new high. So it's been 0:10:57.520 --> 0:11:02.520 in our minds, this broad distribution process that started remember 0:11:02.559 --> 0:11:05.720 when the economy was red hot and right before those 0:11:05.760 --> 0:11:09.520 first terra were fired. This is great, Paul to have 0:11:09.559 --> 0:11:11.480 dog Doug. We're gonna keep it short today just because 0:11:11.480 --> 0:11:13.800 of all the breaking news. But the only reason Paul, 0:11:13.840 --> 0:11:15.880 we have Doug Ramsey on is because he brings up 0:11:15.880 --> 0:11:20.240 the value line, arithmetic and geometric indexes which are which 0:11:20.240 --> 0:11:22.920 are just fabulous. Do you know Ramsey still has on 0:11:23.000 --> 0:11:25.599 his floor the old value line. He trips over it 0:11:26.160 --> 0:11:29.640 like once a week as well. Doug Ramsey, thank you 0:11:29.720 --> 0:11:44.480 so much. With LUTH group, it is a joy always 0:11:44.520 --> 0:11:46.880 to speak with. Eileen Bourbage coming to us today from 0:11:46.880 --> 0:11:52.199 Tel Aviv with Passion Capital. She is outstanding and folding 0:11:52.200 --> 0:11:57.040 in the digital theology of the moment into our daily lives. Eileen, 0:11:57.120 --> 0:12:00.160 I know you've never done this. It's beneath you, but 0:12:00.679 --> 0:12:03.800 the truth is right now. I'm all over the Tied 0:12:03.880 --> 0:12:08.560 Original Scent Liquid laundry detergent, thirty two loads, fifty fluid 0:12:08.600 --> 0:12:12.880 ounces Amazon Choice with a hundred and eleven customer reviews. 0:12:13.080 --> 0:12:17.800 Wanted Today order within four hours eleven minutes it Amazon, 0:12:18.640 --> 0:12:21.240 Why should that be regulated that I want to get 0:12:21.280 --> 0:12:25.679 my tied in four hours eleven minutes same day delivery. 0:12:26.960 --> 0:12:29.200 Nothing's beneath me. I'm willing to roll up my sleeve, 0:12:29.240 --> 0:12:31.800 you know that song Um. I don't know that that 0:12:32.000 --> 0:12:34.680 has to be regulated, but I do think what the 0:12:34.679 --> 0:12:37.600 regulators are looking at is to make sure that Amazon 0:12:37.760 --> 0:12:42.560 isn't sort of inappropriately exerting its influence on smaller merchants. 0:12:42.640 --> 0:12:45.000 So Tied or P and G. I mean, they're probably 0:12:45.000 --> 0:12:46.800 gonna be okay. They can kind of hold their own. 0:12:47.040 --> 0:12:49.920 They can negotiate what will be I guess business, you know, 0:12:50.160 --> 0:12:53.200 standard terms, market practice, market rates. But if you're a 0:12:53.240 --> 0:12:57.320 sort of up and coming independent retailer you've got you know, 0:12:57.440 --> 0:13:01.080 a new sort of bio friendly laundry churchent laundry soap, 0:13:01.400 --> 0:13:03.400 and you want to be on the Amazon marketplace too, 0:13:03.640 --> 0:13:05.040 who's to say that you're going to be able to 0:13:05.080 --> 0:13:07.160 get the same terms that P and G can get. 0:13:07.200 --> 0:13:09.080 And I think that's what the regulators are taking a 0:13:09.080 --> 0:13:12.560 look at. So, Eileen, we've certainly I think seen heard 0:13:12.760 --> 0:13:15.640 felt over the last year year and a half, the 0:13:15.760 --> 0:13:20.760 US regulators US Congression congressional leaders taking maybe a harder 0:13:20.800 --> 0:13:23.280 look at some of the big US tech companies. How 0:13:23.320 --> 0:13:26.120 concerned are you that the tide may be changing and 0:13:26.160 --> 0:13:29.560 that the US may be taking a heavier regulatory hand 0:13:29.679 --> 0:13:33.400 to Silk and Valley. Yeah, I'm not too concerned. I 0:13:33.400 --> 0:13:36.040 think actually this is to be expected. I think of 0:13:36.200 --> 0:13:39.319 the tech companies, but also a lot of sectors that 0:13:39.360 --> 0:13:42.559 are influenced by innovation and by data probably had a 0:13:42.640 --> 0:13:45.120 little bit of a slacker food right for maybe a 0:13:45.160 --> 0:13:48.400 bit too long as the regulators caught up to sort 0:13:48.400 --> 0:13:51.000 of understand some of these implications and why they might 0:13:51.040 --> 0:13:53.520 need to look at protecting consumers interests a little bit 0:13:53.559 --> 0:13:56.240 more ardently. I think there were a lot of companies 0:13:56.240 --> 0:13:58.760 that probably also figured, you know, with the president that 0:13:58.760 --> 0:14:01.360 we've got in the White House, perhaps regulation wasn't going 0:14:01.400 --> 0:14:04.040 to be as much of a problem or much of 0:14:04.080 --> 0:14:06.240 a burden for them. And I think it's about time 0:14:06.280 --> 0:14:08.480 there's been a little bit of scrutiny. The question is 0:14:08.520 --> 0:14:11.280 how far the pendulum is going to swing, and whether 0:14:11.400 --> 0:14:13.960 or not they're going to take actions that are just 0:14:14.240 --> 0:14:17.959 for perception or signaling and not actually practically beneficial to 0:14:18.000 --> 0:14:20.560 anybody that would be a problem, right, So, Eileen, it 0:14:20.600 --> 0:14:24.240 was another busy day in Cooper Tino yesterday, Tim Cook 0:14:24.440 --> 0:14:26.640 and others on stage at trotting out some of the 0:14:26.640 --> 0:14:29.800 newer products and services. What was your takeaway from kind 0:14:29.800 --> 0:14:32.600 of what you saw and and heard from the good 0:14:32.600 --> 0:14:36.720 folks at Apple. Um. I've got a few takeaways. One 0:14:36.720 --> 0:14:38.680 of them was that, you know, it's really interesting that 0:14:38.760 --> 0:14:41.360 they're they're finally coming down a bit on price point, 0:14:41.920 --> 0:14:45.000 and they're probably acknowledging that maybe being at the highest end, 0:14:45.040 --> 0:14:47.600 i mean extreme high end of the market isn't maybe 0:14:47.640 --> 0:14:49.760 going to help them continue to grow their market share. 0:14:50.120 --> 0:14:52.640 So they've come down on price point. Buying a brand 0:14:52.640 --> 0:14:55.000 new iPhone eleven is going to be cheaper than when 0:14:55.080 --> 0:14:57.120 you you know, had to buy the iPhone X or 0:14:57.160 --> 0:14:59.880 the x are. They still have a premium for customers 0:14:59.880 --> 0:15:02.400 like myself that'll be buying in the UK or anyone 0:15:02.440 --> 0:15:04.600 in China, for example. So that will be interesting to 0:15:04.640 --> 0:15:07.880 watch because I do think they heavily rely on what's 0:15:07.880 --> 0:15:11.400 happening in China. Similarly, I saw the emphasis on services, 0:15:11.400 --> 0:15:15.000 and I think continued push on recurring revenue is really 0:15:15.000 --> 0:15:17.680 really key. You know, I'll be honest folks. I did 0:15:17.800 --> 0:15:20.040 this experiment with Paul today. I did the thing where 0:15:20.040 --> 0:15:23.280 you signed up to get ready for September. And I 0:15:23.600 --> 0:15:26.240 want to thank can. I thank McKinnon and Millanoch at 0:15:26.280 --> 0:15:30.000 Maine listening on Bloomberg one. How does she get Bloomberg 0:15:30.040 --> 0:15:33.520 one of six one FM in Boston from Millanoch at Maine. 0:15:33.960 --> 0:15:36.600 She's like totally touchy Earth green, and she said go 0:15:36.680 --> 0:15:39.040 with the midnight green. So I went with the midnight 0:15:39.040 --> 0:15:42.240 green color. Eileen, this is the most brilliant pricing I've 0:15:42.240 --> 0:15:45.600 ever seen. There's this delusion in your world that Apple's 0:15:45.640 --> 0:15:48.760 a luxury evil brand because it's eleven under bucks a month. 0:15:49.400 --> 0:15:52.360 That's bologny. We're buying this like we buy a cable 0:15:52.400 --> 0:15:56.840 TV subscription. Well, you're buying You're gonna buy Apple TV 0:15:56.960 --> 0:15:59.440 Plus like you're buying cable TV now. And that's actually 0:15:59.480 --> 0:16:02.640 what's effect being Netflix, Disney and Roku. The phone steps 0:16:02.680 --> 0:16:05.280 are a different matter. I think there is this diconomy 0:16:05.360 --> 0:16:08.520 between people who appreciate function and probably have had these 0:16:08.560 --> 0:16:11.960 camera features, the extended battery not even extended, but you know, 0:16:12.280 --> 0:16:15.920 reasonable battery life and Android phones for months, if not longer. 0:16:16.080 --> 0:16:18.080 And Apple decides to roll them out in charge, I 0:16:18.120 --> 0:16:19.680 don't know, two or three times as much, and they're 0:16:19.680 --> 0:16:21.720 gonna still in a whole bunch. Yeah, but they're they're 0:16:21.760 --> 0:16:24.040 they're doing this at forty bucks a month, fifty bucks 0:16:24.040 --> 0:16:27.480 a month, maybe seventy five bucks a month tops. That's 0:16:27.520 --> 0:16:31.800 not an eleven purchase psychologically, is it. No, it's not. 0:16:31.880 --> 0:16:33.520 And that's what they're gambling on. And then what they're 0:16:33.520 --> 0:16:35.760 going to try and tack on or oh you get 0:16:35.760 --> 0:16:38.280 a free year of Apple TV plus where you're gonna 0:16:38.280 --> 0:16:40.320 have a free year of Apple Arcade, and they're really 0:16:40.320 --> 0:16:42.080 trying to get you hooked on those services that you're 0:16:42.120 --> 0:16:45.360 gonna pay for beyond. We're gonna stop the show right now, 0:16:45.400 --> 0:16:48.920 Sweeney's expert on this. What in God's name is Apple Arcade? 0:16:49.800 --> 0:16:51.920 You're not a gamer, Tom, I'm not a gamer. But 0:16:52.080 --> 0:16:55.200 how are they going to compete with the adults of 0:16:55.280 --> 0:16:58.160 gamers because they have billions of devices out there and 0:16:58.200 --> 0:16:59.600 they feel like they can just go out and get 0:16:59.640 --> 0:17:01.680 the con and so, you know, I lean Tom brings 0:17:01.760 --> 0:17:03.960 up a good point. I mean, you know the Apple TV. 0:17:04.440 --> 0:17:05.919 You know I thought was interesting about that was the 0:17:05.960 --> 0:17:10.720 price point for undercutting everybody. Um, do you think Apple 0:17:10.840 --> 0:17:14.840 is really serious about the content but the video content 0:17:14.920 --> 0:17:19.320 business UM going forward. I think they're serious. I think 0:17:19.320 --> 0:17:21.440 this is a pretty serious opening for them. I think 0:17:21.440 --> 0:17:23.600 the question is how much they're going to back it up. 0:17:23.640 --> 0:17:27.080 So obviously their catalog or their content materially not you know, 0:17:27.320 --> 0:17:30.159 at all similar to the volume that's on any of 0:17:30.200 --> 0:17:31.920 the other services. So the question will be if they're 0:17:31.920 --> 0:17:35.080 going to continue to invest in original programming, or if 0:17:35.080 --> 0:17:37.560 they're going to start to syndicate other people's programs, and 0:17:37.600 --> 0:17:40.080 if they're going to try and develop the volume that 0:17:40.160 --> 0:17:42.439 other people have UM and the sort of other companies 0:17:42.440 --> 0:17:45.520 of who stuff they affected yesterday. Eileen, you're a great 0:17:45.560 --> 0:17:47.600 student of London. The time we've got left, I really 0:17:47.600 --> 0:17:49.520 want to talk about the future of the city. You've 0:17:49.560 --> 0:17:52.679 been a follower of Brexit and all that, but also 0:17:52.760 --> 0:17:56.480 a follower of the data investment, the staffing in the 0:17:56.560 --> 0:17:59.680 back office. Do you still presume that the city will 0:17:59.720 --> 0:18:04.479 mike great services and staff functions over to continental europe cities. 0:18:06.000 --> 0:18:08.160 I think that some are looking at that and probably 0:18:08.200 --> 0:18:11.520 thinking about contingency planning, but I actually don't believe it's 0:18:11.560 --> 0:18:14.440 going to happen on mass I really don't I think 0:18:14.480 --> 0:18:16.359 that the city of London is going to continue to thrive. 0:18:16.440 --> 0:18:19.639 It's got a huge, huge talent pool. People have been 0:18:19.680 --> 0:18:21.879 here for decades and for years, and we've got great, 0:18:22.000 --> 0:18:25.000 great centralized support from the regulators and so on and 0:18:25.040 --> 0:18:26.720 so forth. So I do think they're going to get 0:18:26.960 --> 0:18:30.199 regulatory equivalent. I think it'd be stilly for boards and 0:18:30.240 --> 0:18:33.080 for corporate governance for people not to look at contingency planning. 0:18:33.320 --> 0:18:35.280 But I don't think it's going to be a total exist. 0:18:35.640 --> 0:18:38.920 Eileen Bourbage, thank you so much. Greatly appreciated on technology, 0:18:39.000 --> 0:18:41.440 but with a really different tist twist cheests with Passion 0:18:42.480 --> 0:19:00.440 Capital Partners. Eileen Bourbage from London usually and from Tel Aviv. Today. 0:19:02.440 --> 0:19:05.119 Right now we're gonna go to Chris Hughes, who wrote 0:19:05.160 --> 0:19:09.760 a durable and wonderful essay off of the shock of 0:19:09.800 --> 0:19:13.800 the Hong Kong Stock exchange going after the London Stock exchanged. Chris, 0:19:14.040 --> 0:19:16.240 I'm going to suggest r S a move the market 0:19:16.280 --> 0:19:19.240 today as we saw a huge jump in LSE shares 0:19:19.280 --> 0:19:22.000 and they've really come back for a number of different reasons. 0:19:22.000 --> 0:19:23.359 And I'm not going to give you all the credit, 0:19:23.640 --> 0:19:28.000 but you really set the tone how critical is it 0:19:28.119 --> 0:19:32.160 did the Hong Kong Stock Change go after this refinitive, 0:19:32.520 --> 0:19:38.560 the Thompson Reuters data package that LCS trying to acquire. Well, 0:19:39.040 --> 0:19:41.680 I think the Hong Kong Exchange is trying to essentially 0:19:41.720 --> 0:19:44.879 stop the NFC getting refinitive. It's trying to get the 0:19:45.000 --> 0:19:48.440 NFC and it's only got a few months in which 0:19:48.520 --> 0:19:51.399 to do this. The NFC shareholders have got a vote 0:19:51.440 --> 0:19:55.400 on that definitive transaction quite soon, so it's now or never. 0:19:55.520 --> 0:19:58.639 So the criticality is sort of in the in this 0:19:58.680 --> 0:20:02.560 opportunity to get this historic exchange and bust up it's 0:20:03.200 --> 0:20:06.560 deal with Definitive, and it's you know, it's it's it's 0:20:06.560 --> 0:20:09.560 wasted no time. I mean that deal was only inked 0:20:09.600 --> 0:20:11.520 a few weeks ago and here it is. You wonder 0:20:11.560 --> 0:20:13.880 if actually they were thinking about doing this with sometime 0:20:14.400 --> 0:20:17.040 and Definitive kind of forced it. But this is fine, 0:20:17.040 --> 0:20:20.240 And folks, we should mention that Refinitive and the Old 0:20:20.240 --> 0:20:23.000 Times and Right Reuters in their icon terminal as a 0:20:23.000 --> 0:20:27.560 direct competitor of BLOOMBERGILP and or acclaimed terminals as well. 0:20:28.000 --> 0:20:31.280 Everybody's saying the right things, the posturing what would you 0:20:31.320 --> 0:20:33.520 expect will be next? I mean, do you have any idea, 0:20:33.640 --> 0:20:36.800 Chris Hughes, of what happens into this week, through the 0:20:36.840 --> 0:20:40.160 weekend and in the next week. Yeah, it's a really 0:20:40.200 --> 0:20:45.399 interesting question because this negotiation here is playing out quite oddly. 0:20:45.480 --> 0:20:48.200 You know, when you're trying to buy a national stock exchange, 0:20:48.680 --> 0:20:50.440 you really want to get everything lined up, you want 0:20:50.440 --> 0:20:52.800 to get the board on side, you want to get 0:20:53.280 --> 0:20:56.120 tea off all of the political side of it. And 0:20:56.160 --> 0:20:59.360 what Hong Kong Exchange has done is it's gone public 0:20:59.480 --> 0:21:02.639 with this actually quite tend toive proposal that's sort of 0:21:02.640 --> 0:21:04.480 firm offer him. It's just gone public with this, and 0:21:04.480 --> 0:21:08.000 it's really put the NSSE board on the spot. You know, 0:21:08.000 --> 0:21:10.080 it's kind of came as a big surprise to the market. 0:21:10.119 --> 0:21:14.479 That's not normally how you go about buying a you know, 0:21:14.720 --> 0:21:17.920 a sort of national asset like the stock exchange. So 0:21:18.480 --> 0:21:22.240 over the coming days, Hong Kong Exchange has really got 0:21:22.240 --> 0:21:25.480 to kind of flesh out kind of why this makes 0:21:25.520 --> 0:21:29.200 sense and try to keep the atmosphere sort of friendly, 0:21:29.240 --> 0:21:33.000 even though I think going public with a unsolicited offer 0:21:33.040 --> 0:21:35.119 is kind of not the most friendly thing to do. 0:21:35.680 --> 0:21:37.199 So Chris, give us a sense of kind of the 0:21:37.240 --> 0:21:43.080 political overtones here Hong Kong Exchange, London Exchange, Hong Kong 0:21:43.240 --> 0:21:45.520 UK give us kind of the sense you're you're hearing 0:21:45.520 --> 0:21:49.159 over there. Yeah, that's a really good question. Um. I 0:21:49.200 --> 0:21:54.120 suppose the first question is does the UK want any 0:21:54.320 --> 0:21:59.240 foreign acquire acquirer to to buy the London Stock Exchange? 0:21:59.280 --> 0:22:01.760 Not really. The London Stock Exchange is a quoted company. 0:22:02.280 --> 0:22:04.880 It's got shares that trade on the London Stock Exchange. 0:22:04.960 --> 0:22:07.360 So in that sense, you know anyone can come along 0:22:07.400 --> 0:22:09.640 and buy it. But we all know that stock exchanges 0:22:09.640 --> 0:22:13.760 are quite sensitive assets. I mean, when these itself agreed 0:22:14.080 --> 0:22:17.960 a deal with Deutsche Borsa that fell apart, and that 0:22:18.000 --> 0:22:21.480 was with both managements initial support. So the first thing 0:22:21.520 --> 0:22:24.280 to observe is that any cross border deal for an 0:22:24.320 --> 0:22:28.000 exchange is just really really hard. Then you layer on 0:22:28.080 --> 0:22:33.160 the complication of this being China into the UK. I mean, 0:22:33.160 --> 0:22:36.359 clearly there aren't close links between the UK and China 0:22:36.440 --> 0:22:38.960 and in many respects, but that's going to cause you 0:22:39.119 --> 0:22:42.320 some heightened scrutiny. So there are a lot of questions 0:22:42.359 --> 0:22:45.119 on on all levels about the political back drop. And 0:22:45.160 --> 0:22:48.240 then of course I have to mention Brexit. Now, this 0:22:48.280 --> 0:22:51.199