WEBVTT - Microsoft Buys Activision Blizzard in $69 Billion Game Deal 0:00:01.800 --> 0:00:04.440 This is Bloomberg Business Week. I'm Carol Masser and I'm 0:00:04.480 --> 0:00:07.320 Bloomberg Quick Takes Tim Stanovk. We're here every day bringing 0:00:07.320 --> 0:00:09.840 you the latest news from the world to business and finance, 0:00:09.840 --> 0:00:13.640 plus technology, politics, economics, all partnising the power of Business 0:00:13.680 --> 0:00:17.160 Week reporters and editors, not to mention our journalists and 0:00:17.160 --> 0:00:20.000 analyst in more than one twenty countries. You can download 0:00:20.000 --> 0:00:23.239 Bloomberg Business Week and iTunes, SoundCloud, or Bloomberg dot com. 0:00:23.400 --> 0:00:25.200 You can also listen to our radio show at two 0:00:25.200 --> 0:00:27.880 pm Eastern Time on Bloomberg Radio or watch us on 0:00:27.920 --> 0:00:32.000 YouTube search Bloomberg Global News. Tim. Uh, you know that 0:00:32.040 --> 0:00:34.880 one headline for the World Health Organization about a macron 0:00:34.920 --> 0:00:38.640 won't be the last variant um, but you do you know, 0:00:38.680 --> 0:00:41.559 you're reminded that this thing is gonna linger, hopefully get easier, 0:00:41.600 --> 0:00:44.000 but linger hopefully. Look and we've talked to people about this, 0:00:44.040 --> 0:00:45.880 and we're gonna talk more about this. But the idea 0:00:45.880 --> 0:00:48.800 of going from a pandemic to endemic and the idea 0:00:48.840 --> 0:00:53.519 that amcron could be uh that maybe look here here 0:00:53.520 --> 0:00:55.600 in New York City, the COVID nineteen waves is slowing. 0:00:55.640 --> 0:00:58.720 Cases and hospitalizations are dropping. Dramatically from a peak in 0:00:58.760 --> 0:01:03.000 early January and remaining concentrated among those who are unvaccinated. Carol, Right, 0:01:03.000 --> 0:01:05.840 but now we're hearing also about animals South Africa, Hong Kong, 0:01:05.840 --> 0:01:08.360 Like there's some concerns about that. All right, it's never 0:01:08.480 --> 0:01:11.120 adult day when it comes to COVID. Hey, let's bring 0:01:11.120 --> 0:01:13.760 in our guest, Dr Tom McGinn. He's executive vice president 0:01:13.800 --> 0:01:17.520 of Physician Enterprise of a Common Spirit Health. They've got 0:01:17.880 --> 0:01:22.000 more than a thousand sights in some twenty ones Uh cities. 0:01:22.080 --> 0:01:24.640 Excuse me, in twenty one states, I should say. Uh. 0:01:24.680 --> 0:01:26.400 They are a massive team and they see a lot. 0:01:26.440 --> 0:01:27.920 And he's back with us on the phone in New 0:01:28.000 --> 0:01:30.240 York City, Dr McGinn. Nice to have you here with 0:01:30.280 --> 0:01:33.440 Tim and myself. How are you and what are you seeing? 0:01:34.880 --> 0:01:38.240 Great to be back and good to talk to you again. UM. Well, 0:01:38.280 --> 0:01:40.320 I don't think we're seeing anything different than what you're 0:01:40.360 --> 0:01:43.080 currently saying. I do think, Um, as you go across 0:01:43.120 --> 0:01:45.800 the country, you can see the cases, particularly in the 0:01:45.840 --> 0:01:47.960 East coast, because you've been stating here in New York 0:01:48.080 --> 0:01:51.280 and Maryland, New Jersey. The number of cases are obviously 0:01:51.320 --> 0:01:55.160 starting to turn down, which is good news. The tough 0:01:55.200 --> 0:01:58.920 news is obviously that hostializations are in other areas picking 0:01:59.040 --> 0:02:02.400 up as this virus moves across the country. So we 0:02:02.440 --> 0:02:05.080 have pockets in areas where we're seeing a little downturn, 0:02:05.120 --> 0:02:07.560 but we have pockets where we're probably at the beginning 0:02:07.640 --> 0:02:11.480 of this inflection. We think we're gonna beat all our 0:02:11.639 --> 0:02:15.040 prior records in the original January phase, the dells a 0:02:15.040 --> 0:02:19.160 way we're gonna We're gonna definitely be in terms of hospitalizations. 0:02:19.480 --> 0:02:22.720 We're going to probably peek over all the prior quote 0:02:22.760 --> 0:02:27.720 unquote records, which is difficult with staffing right now. I 0:02:27.760 --> 0:02:30.079 think that's that's the combination that we're all struggling with. 0:02:30.200 --> 0:02:32.679 So yeah, I mean it's it's obviously not just the 0:02:32.720 --> 0:02:34.880 healthcare industry, but it puts it in sharp relief when 0:02:34.960 --> 0:02:37.800 you know the doctors who have and and and nurses 0:02:37.800 --> 0:02:40.760 who've been doing this for close to two years are 0:02:40.800 --> 0:02:44.360 just under such strain that it's difficult to you know, 0:02:44.400 --> 0:02:47.560 find a place in in in certain hospitals. Hey, Dr McGinn, 0:02:47.560 --> 0:02:50.480 I'm wondering because you have such a unique view of 0:02:50.680 --> 0:02:53.200 what's happening in different parts of the country in more 0:02:53.240 --> 0:02:55.960 than twenty states. How would you characterize the people who 0:02:55.960 --> 0:02:57.960 are hospitalized right now? What can you tell us about 0:02:58.320 --> 0:03:01.000 who's hospitalized you has been vACC needed and boosted versus 0:03:01.040 --> 0:03:04.440 who isn't. Yeah, that's a very good question. I mean 0:03:04.480 --> 0:03:07.480 it's pretty well delineated. Um, I mean the number is 0:03:07.520 --> 0:03:09.720 a little bit very but I would say anywhere from 0:03:09.800 --> 0:03:15.480 six of those admitted are unvaccinated, probably closer and in 0:03:15.480 --> 0:03:19.680 some places, and we do have, um, you know some 0:03:19.760 --> 0:03:21.120 of this. We don't know the number. I think it's 0:03:21.120 --> 0:03:24.720 an interesting question of the incidental COVID, which is kind 0:03:24.760 --> 0:03:27.760 of a misleading term. So example of you know, Mr Smith, 0:03:27.760 --> 0:03:29.799 a young man comes in with an ankle fracture and 0:03:29.840 --> 0:03:31.920 needs to be seeing. They swap and he's positive, so 0:03:31.919 --> 0:03:35.800 he's not very cost of COVID, so he's incidentally diagnosed. 0:03:35.800 --> 0:03:38.520 We don't know what that number looks like. Uh, and 0:03:38.760 --> 0:03:41.000 that could be anywhere from a couple of percentage points, 0:03:41.040 --> 0:03:42.640 you know, maybe it's a ten percent. Now you still 0:03:42.680 --> 0:03:44.440 have to isolate them, you still have to have protection. 0:03:44.520 --> 0:03:48.320 It's still very complicated to manage those patients. But in 0:03:48.360 --> 0:03:52.000 some ways they're not a traditional COVID case. So predominantly 0:03:52.080 --> 0:03:55.040 unvaccinated people are getting admitted to the hospitals. The remainder 0:03:55.160 --> 0:04:00.000 are going to be those with comorbidities that you know, obesity, diabetes, hypertension, 0:04:00.040 --> 0:04:06.040 and cortivascular disease, et cetera. Dr Wicked, I do wonder too, 0:04:06.240 --> 0:04:08.800 are you saying cases where you guys and your teams 0:04:08.840 --> 0:04:12.280 and your emergency room staff are having to make decisions 0:04:12.360 --> 0:04:16.640 because there's just the systems are overloaded and you maybe 0:04:16.720 --> 0:04:21.479 can't have someone come in because maybe it's not because 0:04:21.480 --> 0:04:23.240 of COVID, but for some other reason, you just can't 0:04:23.279 --> 0:04:25.000 let them in because you just don't have the capacity. 0:04:26.720 --> 0:04:28.919 You know, we haven't reached that point. Thank Thankfully, that 0:04:29.040 --> 0:04:31.839 is not something that's happening. The choices that were currently facing, 0:04:31.839 --> 0:04:35.400 and again this is very particular to you different cities 0:04:35.400 --> 0:04:38.760 and different prevalences of the disease that's occurring, is whether 0:04:38.839 --> 0:04:41.000 we can we have to shut down other procedures that 0:04:41.080 --> 0:04:43.760 we do, some of them, you know, are potentially life 0:04:43.880 --> 0:04:46.520 life saving. Maybe we have to have patients go to 0:04:46.560 --> 0:04:50.240 another site for certain things. Some some of our hospitals 0:04:50.279 --> 0:04:53.920 have had to you know, shift out of their elective procedures. 0:04:53.920 --> 0:04:57.240 Sometimes we've had to pull physicians or nurses or advanced 0:04:57.240 --> 0:04:59.800 care providers out of ambilatory sites to come in and 0:04:59.800 --> 0:05:03.120 help cover. So there is an impact, but it's sort 0:05:03.120 --> 0:05:05.360 of an indirect impact. But no one is ever getting 0:05:05.360 --> 0:05:07.320 turned away in the sense that it could not get care. 0:05:08.160 --> 0:05:10.880 But we are pulling things away from other you know, 0:05:11.680 --> 0:05:14.679 you know, resources, the elective procedures for example. Not everyone, 0:05:14.720 --> 0:05:17.000 I'm saying, in small pockets that's happened. What are you 0:05:17.040 --> 0:05:19.120 telling the world at large? I mean, Tim and I 0:05:19.200 --> 0:05:21.360 have had guests on who basically have said, you're all 0:05:21.400 --> 0:05:26.960 going to get this. I'm home because I've had a 0:05:27.040 --> 0:05:31.279 positive rapid and my PCR came back negative. I don't 0:05:31.279 --> 0:05:33.600 have any symptoms. I'm pretty sure it was, you know, 0:05:33.760 --> 0:05:37.400 just a false positive. But nonetheless we're being careful, um, 0:05:37.400 --> 0:05:40.480 which is the right thing to do. But it reminded 0:05:40.480 --> 0:05:43.120 me that if it's not now, it's it's probably just 0:05:43.160 --> 0:05:44.800 a matter of time. Is that the way we need 0:05:44.839 --> 0:05:48.279 to look at it? Well, I would say, well, first 0:05:48.279 --> 0:05:50.359 and foremost, I would say, we all just need to 0:05:51.040 --> 0:05:54.720 just just really focus on doing all the smart things 0:05:54.760 --> 0:05:57.280 because of our hospitals and our health care workers and 0:05:57.360 --> 0:05:59.360 everyone involved in this, we need to do what we can. 0:05:59.520 --> 0:06:02.560 Just just stem this tide. I'm a little nervous with 0:06:02.600 --> 0:06:04.800 all the messaging. Oh this is the waves are coming down, 0:06:04.839 --> 0:06:06.560 and all to that effect. We need to continue to 0:06:06.560 --> 0:06:09.560 get vaccinated boosted. We need to get the influenza shot, 0:06:09.600 --> 0:06:12.000 which is picking up across the United States. We're now 0:06:12.000 --> 0:06:15.440 seeing young children get admitted for influenza and what we 0:06:15.560 --> 0:06:17.640 predicted the over a year ago, the twin demic is 0:06:17.680 --> 0:06:20.280 happening now. And if we all don't get the flu shot, 0:06:20.320 --> 0:06:23.640 we're going to have some struggles there. Will we all 0:06:23.720 --> 0:06:25.880 end up getting it? You know? I don't. I don't 0:06:26.040 --> 0:06:29.000 think so, but you know, certainly a large percentage of 0:06:29.080 --> 0:06:32.640 us will will will have eventually gotten this. But to me, 0:06:32.760 --> 0:06:34.640 that's not the important question. The question is, right now, 0:06:34.680 --> 0:06:37.279 what can we all do? Don't wear a cloth mask, 0:06:37.360 --> 0:06:39.640 by the way, no one should wear a cloth Please 0:06:39.680 --> 0:06:41.920 stop the madness. All right, We're gonna leave it on 0:06:41.920 --> 0:06:43.920 that note, And that's a good piece of advice. Dr 0:06:43.960 --> 0:06:48.880 Tom McGain over Common Spirit Health E V of Physician Enterprise. 0:06:48.880 --> 0:06:51.360 We appreciate his input. Turning us on the phone in 0:06:51.400 --> 0:06:56.239 New York City, this is Bloomberg Business Week with Carol 0:06:56.320 --> 0:07:01.560 Masser and Bloomberg Quick Takes Tim Stinovic on Boomberg Radio. So, Tim, 0:07:01.560 --> 0:07:03.440 I think about you know, we worry about inflation, we 0:07:03.520 --> 0:07:06.400 worry about central banker policy missteps, we worry about slowing 0:07:06.400 --> 0:07:08.480 anconemic growth and earnings. And then you've got m and 0:07:08.560 --> 0:07:12.160 a record year last year, and those big blockbuster transactions 0:07:12.200 --> 0:07:14.119 they continue. I thought you were gonna say you worry about, 0:07:14.160 --> 0:07:17.160 you know, large technology companies going out of alone. Apparently 0:07:17.160 --> 0:07:20.880 not where you're worried. We are, of course, talking about 0:07:21.040 --> 0:07:24.280 the huge news today Microsoft buying Activision Blizzard, the game publisher, 0:07:24.280 --> 0:07:27.760 and a sixty billion dollar game deal, if approved by 0:07:27.800 --> 0:07:31.720 regulators A key key phrase here, would create the third 0:07:31.800 --> 0:07:35.120 largest game publisher in the world. So let's bring in 0:07:35.280 --> 0:07:37.640 Anara Grana. He is senior analyst of software and I 0:07:37.680 --> 0:07:40.200 T Services at Bloomberg Intelligence. He's on the phone from 0:07:40.320 --> 0:07:44.040 Chicago Onoraga. Heard you on surveillance this morning breaking this 0:07:44.120 --> 0:07:48.480 down as it was, you know, being or crossing. Um, 0:07:48.520 --> 0:07:52.040 are you surprised? Does this make sense? Oh? It does 0:07:52.160 --> 0:07:54.000 make a lot of sense. But I was surprised at 0:07:54.000 --> 0:07:57.480 the same time, only because you know, as you said, 0:07:57.600 --> 0:08:00.920 this is not the season for large, large deals, just 0:08:01.000 --> 0:08:04.360 because the regulators are taking a look at this very closely, 0:08:05.160 --> 0:08:07.520 which is why the surprise is more so the size 0:08:07.560 --> 0:08:10.520 of it and the timing. But you know, the content 0:08:10.600 --> 0:08:13.200 side of it makes a lot of sense. And as 0:08:13.240 --> 0:08:15.480 I think I mentioned that in a couple of places before, 0:08:16.040 --> 0:08:21.000 we expected the gaming content wars to have begun many 0:08:21.040 --> 0:08:23.960 many years ago, and it's just taken a long time 0:08:24.320 --> 0:08:26.760 for them to pan out. So why does the content 0:08:26.800 --> 0:08:31.200 side make sense? Is it specifically for the Xbox platform 0:08:31.280 --> 0:08:36.000 and the newest version of the cloud service that Xbox offers, 0:08:36.000 --> 0:08:38.400 the subscription service that it offers to two people for 0:08:38.480 --> 0:08:41.560 fifteen bucks a month. Or is this about mobile? Is 0:08:41.559 --> 0:08:44.400 it about getting getting onto mobile devices and Microsoft finally 0:08:44.400 --> 0:08:47.080 being able to do that. I think it's all of 0:08:47.120 --> 0:08:50.000 the above. Think about it the same thing. What's happening 0:08:50.000 --> 0:08:53.439 on the Netflix and the Disney arena. The company, the 0:08:53.920 --> 0:08:57.720 distribution channel or how you get the content is going 0:08:57.760 --> 0:09:00.760 to be you know, irrelevant later on whether you see 0:09:00.760 --> 0:09:03.080 the you know, the movie on on the phone or 0:09:03.160 --> 0:09:06.280 through any other leads. But having the content is the 0:09:06.320 --> 0:09:09.599 most important parts. So if you have the biggest screaming franchise, 0:09:10.160 --> 0:09:14.760 then whether you sell that through virtual reality device or 0:09:14.800 --> 0:09:19.680 through excuse me, question, so it doesn't matter. Hey, un 0:09:19.760 --> 0:09:22.480 a RUG, do do regulators have have an issue with this? 0:09:22.640 --> 0:09:25.680 Is that something that investors should be concerned about. I 0:09:25.679 --> 0:09:28.160 think that's the biggest season because you know, that's possibly 0:09:28.160 --> 0:09:29.960 the reason I think with the stocks on date about 0:09:30.280 --> 0:09:33.280 if you two points something, um, I think that remains 0:09:33.320 --> 0:09:37.400 the biggest concern, un RUG. One thing I'm curious about 0:09:37.440 --> 0:09:41.560 Bobby Cootech of Activision Microsoft in Activision, I think it's 0:09:41.600 --> 0:09:44.320 safe to say they're different kinds of companies, and I 0:09:44.360 --> 0:09:48.160 just do wonder, you know, how much of what Activision 0:09:48.280 --> 0:09:50.680 is in terms of its culture, it's types of management, 0:09:50.720 --> 0:09:53.680 it's crucial to keep it to some extent, or do 0:09:53.720 --> 0:09:56.040 you think it just doesn't matter independent, you know, in 0:09:56.080 --> 0:09:59.320 terms of how much it gets integrated into Microsoft. You know, 0:09:59.400 --> 0:10:01.679 that was a big question we had this morning as well, 0:10:01.760 --> 0:10:04.320 and although he was on the call this morning, we 0:10:04.400 --> 0:10:06.920 have since then read that once the dealers closed, he 0:10:06.960 --> 0:10:09.400 will not be part of the company. So I think 0:10:09.440 --> 0:10:11.760 that's a very good thing because one of the things 0:10:11.760 --> 0:10:15.080 we had also said before was when this news broke up, 0:10:15.080 --> 0:10:19.680 the Activation is issues. Um Phil Spencer, Microsoft Gaming CEO 0:10:20.160 --> 0:10:23.360 was very vocal and against it, so we were. You know, 0:10:23.960 --> 0:10:26.040 initially when the first deal break broke out, we were 0:10:26.080 --> 0:10:29.200 surprised that he still remains with the company, but you know, 0:10:29.240 --> 0:10:31.800 in subsequent releases we have heard that he will leave. 0:10:32.760 --> 0:10:35.320 All right, So the question that that I have is 0:10:36.160 --> 0:10:38.160 what other gaming companies are in play now? That if 0:10:38.160 --> 0:10:41.000 regulators approved this and we see the stock reacting for 0:10:41.080 --> 0:10:44.280 competitors like e A and UH, you know among others, 0:10:44.600 --> 0:10:49.560 you be soft, who's in play now? I think all 0:10:49.640 --> 0:10:51.280 of them are in play. I mean it's going to 0:10:51.320 --> 0:10:53.880 be a question of but the question is who's going 0:10:53.920 --> 0:10:55.719 to buy them. I mean, it is going to be 0:10:55.800 --> 0:10:59.120 easier for Amazon or Apple, on Facebook or Google to 0:10:59.120 --> 0:11:01.520 go out and buy so movise companies. I think it's 0:11:01.559 --> 0:11:03.679 going to be tougher for them. I think Microsoft has 0:11:03.760 --> 0:11:07.680 so far evaded the scrutiny of the regulators just because 0:11:07.760 --> 0:11:10.920 you know, they don't have that level of I guess 0:11:11.679 --> 0:11:14.600 a lens on them as some of the other companies too. 0:11:15.200 --> 0:11:16.960 All right, well, we'll be certainly watching out for that 0:11:17.040 --> 0:11:19.760 aspect of this deal. Um Anna rog, thank you so much. 0:11:19.760 --> 0:11:22.000 Good to catch up. Annaa Grana. He's senior analyst of 0:11:22.000 --> 0:11:24.400 Software and I T Services at Bloomberg Intelligence on the 0:11:24.400 --> 0:11:26.360 phone from Chicago. But it's going to be a group 0:11:26.360 --> 0:11:28.520 that's on our radar this year, Tim, Yeah, it certainly is. 0:11:28.559 --> 0:11:30.880 And Microsoft devating regulators right at least for the last 0:11:31.160 --> 0:11:34.040 couple of decades. They have some history there. You're listening 0:11:34.080 --> 0:11:38.200 to Bloomberg Business Week with Carol Masser and Bloomberg Quick Takes. 0:11:38.320 --> 0:11:42.640 Tim Stinovic on Bloomberg Radio. Well. Bloomberg business Week continuing 0:11:42.679 --> 0:11:44.760 to report on the real estate world and its lack 0:11:44.800 --> 0:11:47.760 of diversity and inclusion, and in the upcoming issue of 0:11:47.760 --> 0:11:50.440 the magazine it's out later this week, a story about 0:11:50.480 --> 0:11:55.960 the progressive real estate firm Redfinn that's facing accusations of discrimination. Tim. 0:11:55.960 --> 0:11:57.920 You can also find the story online the stories by 0:11:57.960 --> 0:12:00.199 Peter Robeson and Noah bou Hire. Peter robe us In 0:12:00.280 --> 0:12:03.000 as Projects and Investigations reporter for Bloomberg News. He joins 0:12:03.080 --> 0:12:05.080 us on the phone from Seattle, as does Joel Webber, 0:12:05.120 --> 0:12:06.960 editor at Bloomberg Business Week. He joins us on the 0:12:06.960 --> 0:12:08.800 access line from Brooklyn. Joel. I think a lot of 0:12:08.800 --> 0:12:10.520 people in New York City they know, you know, they 0:12:10.520 --> 0:12:13.439 know about the New York City serves street Street Easy 0:12:13.480 --> 0:12:15.800 and the New York City specific services. And we've talked 0:12:15.800 --> 0:12:19.080 a lot about Zillo. For the uninitiated, redfin what is 0:12:19.120 --> 0:12:24.240 it huge huge provider UM And basically, if you're anywhere 0:12:24.240 --> 0:12:28.120 else uh in the country and or concluded UM, you know, 0:12:28.160 --> 0:12:31.200 the chances are when you when you go UH to 0:12:31.320 --> 0:12:34.400 list your home, like Redfinn could be a place that 0:12:34.600 --> 0:12:37.040 UM you consider UM. And one of the things that 0:12:37.480 --> 0:12:41.400 that they've done is really had a Mid American offering. 0:12:41.440 --> 0:12:45.959 But as Peter and uh No, his reporting goes into UM, 0:12:46.000 --> 0:12:49.720 there's still these vestiges that the real estate industry industry 0:12:49.760 --> 0:12:55.079 specifically kind of runs up against, and racial elements are 0:12:55.200 --> 0:12:57.520 are continue to just be a really problematic one and 0:12:57.559 --> 0:13:01.240 that that is basically the subject the lawsuit that Redfin 0:13:01.360 --> 0:13:03.640 has been involved with. So so Peter break it down 0:13:03.679 --> 0:13:05.280 for us, what are the what are the two sides 0:13:05.280 --> 0:13:09.960 fighting over sure. So so redfin um it appears to 0:13:09.960 --> 0:13:12.440 to most people browsing on on the web to be 0:13:12.559 --> 0:13:14.920 much like Zillo, that it's a place where you can 0:13:14.960 --> 0:13:18.760 get homeless things and valuations. But Redfin is also a 0:13:18.800 --> 0:13:21.400 huge broker. It's the fifth largest real estate broker in 0:13:21.400 --> 0:13:25.400 the country, and Redfinn has a very very organized way 0:13:25.559 --> 0:13:29.240 of collecting leads of of people who want to either 0:13:29.360 --> 0:13:32.200 list or their home or buy a home through redfin 0:13:32.800 --> 0:13:37.040 and they categorize these leads based on the value UH 0:13:37.280 --> 0:13:40.520 that UH is that that that sale or purchase is 0:13:40.520 --> 0:13:44.080 going to provide in each market, which they've used as 0:13:44.080 --> 0:13:46.840 a way to manage their workforce. They have a certain 0:13:46.920 --> 0:13:50.480 number of agents in each city, and they're in certain 0:13:50.520 --> 0:13:53.240 parts of the of each city. Um so, so they 0:13:53.640 --> 0:13:56.800 argue that this is simply a way of organizing their business. UH. 0:13:56.920 --> 0:14:01.000 The lawsuit brought by fair housing groups towards the end 0:14:01.040 --> 0:14:06.000 of UH pointed out that, according to their studies, redfin 0:14:06.120 --> 0:14:08.640 is is much more likely to not provide its best 0:14:08.679 --> 0:14:13.199 service to homes that are in predominantly non white neighborhoods. 0:14:13.200 --> 0:14:15.400 So that's what the fight is about. And and no, 0:14:15.559 --> 0:14:18.480 and I also talked to many current former red Fan 0:14:18.520 --> 0:14:21.400 employees and some of those people said that they had 0:14:21.720 --> 0:14:24.920 had concerns over the years about how much service Redfan 0:14:25.040 --> 0:14:28.560 is providing to minority neighborhoods. So at issues you do wonder, 0:14:28.760 --> 0:14:31.040 you know, Peter, in terms of is it just a 0:14:31.080 --> 0:14:34.560 case of a company maximizing profit and they're you know, 0:14:34.680 --> 0:14:37.720 organizing their organization to to maximize the most out of 0:14:37.720 --> 0:14:40.880 their resources, or are they discriminating based on what you 0:14:40.880 --> 0:14:43.840 guys found out And there's so much detail in the story. 0:14:45.200 --> 0:14:49.600 What's going on or what are you seeing? Redfin argues 0:14:49.680 --> 0:14:52.800 that that this is with within their their right, so 0:14:52.880 --> 0:14:56.600 this is legally permitted, that that they're applying a neutral 0:14:57.400 --> 0:15:00.680 basis That price is a neutral basis um to decide you. 0:15:00.720 --> 0:15:03.240 But what the fair housing groups are arguing is that 0:15:03.240 --> 0:15:06.640 that's also a gating practice, that instead of taking each 0:15:06.720 --> 0:15:09.600 lead as they come in, they're they're assigning each lead 0:15:09.640 --> 0:15:13.840 based on value. And UH, it is not resolved yet. 0:15:14.200 --> 0:15:16.640 The two sides say they have a framework for resolving 0:15:16.640 --> 0:15:19.080 the suit. It's partly going to come down to the data, 0:15:19.080 --> 0:15:21.960 and there's not agreement on the data between the two sides. 0:15:22.080 --> 0:15:26.080 The fair housing groups contend that the data shows uh 0:15:26.120 --> 0:15:30.080 that people in minority neighborhoods are less likely to get 0:15:30.120 --> 0:15:33.400 good service. Redfin claims that more recently, which is after 0:15:33.480 --> 0:15:36.200 the period of the suit, UH, that their data is 0:15:36.240 --> 0:15:39.840 showing that, uh, they're not discriminating against people by race. 0:15:41.520 --> 0:15:44.200 So Peter, let's talk a little bit more about REDFINN 0:15:44.280 --> 0:15:47.760 because UH, if if you know anything about the company, 0:15:47.840 --> 0:15:52.160 some of these developments might come as something of the surprise, right, Yes, 0:15:52.280 --> 0:15:55.040 that that's um part of what really drew us to 0:15:55.040 --> 0:15:58.440 the story because Redfinn and its CEO Glenn Kelman have 0:15:58.600 --> 0:16:02.680 an extremely progressive reputation in the industry, and and Dave 0:16:03.560 --> 0:16:07.400 cultivated that. Glenn Kellman well before George Floyd's murder was 0:16:07.840 --> 0:16:10.800 he hosted a symposium on race and real estate, and 0:16:10.840 --> 0:16:15.640 he's spoken out against unconscious bias. He's uh, he's increased 0:16:15.640 --> 0:16:19.160 the training for unconscious bias after the Black Lives Matter protests. 0:16:19.400 --> 0:16:24.440 Um he uh created new rules to reward managers based 0:16:24.480 --> 0:16:29.840 on diversity and hiring. Um so so uh. That's partly 0:16:29.840 --> 0:16:32.520 what's so interesting about this suit is that even a 0:16:32.520 --> 0:16:37.840 company that beliefs and everything right uh can run into issues. 0:16:37.960 --> 0:16:41.360 We we the the opening example in the story was 0:16:41.400 --> 0:16:44.360 about a house on the South side of Chicago that's 0:16:44.360 --> 0:16:48.440 worth eight seven thousand, which at the time we looked 0:16:48.440 --> 0:16:52.520 at Redmond was not offering its best service. However, at 0:16:52.520 --> 0:16:55.480 the same time of a house in a phenominantly white 0:16:55.480 --> 0:16:58.200 suburb of Glencoe, it was actually a condo, which is 0:16:58.240 --> 0:17:02.040 value for twenty less was being offered Redfin's best service. 0:17:02.920 --> 0:17:06.560 Uh So, so that that's that's the type of discrepancies 0:17:06.600 --> 0:17:09.840 and disparities that uh we looked at and which are 0:17:09.920 --> 0:17:13.640 so alarming to these fair housing groups. So if if 0:17:13.680 --> 0:17:15.760 we step back from even that one, you know, Peter, 0:17:15.920 --> 0:17:18.959 the ultimate theme here and you guys touched on this 0:17:19.000 --> 0:17:23.280 in in some prior reporting as well, is basically, uh, 0:17:23.440 --> 0:17:26.240 minorities have been locked out of a lot of the 0:17:26.960 --> 0:17:30.240 wealth creation that real estate has afford. So so what 0:17:30.320 --> 0:17:32.240 when you just step back and think about what all 0:17:32.280 --> 0:17:35.720 of your reporting on this topic is means, like, how, 0:17:35.880 --> 0:17:39.520 how are we getting anywhere better? Have there been any improvements? 0:17:41.240 --> 0:17:43.240 There may be some improvements to come out of this suit. 0:17:43.359 --> 0:17:47.800 I Uh we had looked in the past that the 0:17:48.320 --> 0:17:53.359 Realtors Association which apologized for made a formal public apology 0:17:53.480 --> 0:17:57.560 for for decades of past racist behavior. Uh there is 0:17:57.600 --> 0:18:00.760 more awareness in the industry and that seems to be 0:18:00.800 --> 0:18:04.959 helping um and perhaps out of this. You know, one 0:18:05.240 --> 0:18:07.760 person that we talked to said that, uh, you know, 0:18:07.840 --> 0:18:10.840 redlining is a has been a part of the real 0:18:10.920 --> 0:18:13.560 estate industry, and we don't want to have redlining in 0:18:13.600 --> 0:18:16.159 the age of algorithms. So this is the moment to 0:18:16.200 --> 0:18:19.280 not let history repeat itself. But it's a great point 0:18:19.359 --> 0:18:22.439 about here You've got a CEO who you feel like 0:18:22.520 --> 0:18:25.239 has been on it and doing the right thing, and 0:18:25.240 --> 0:18:28.480 then to see that you know there are problems there too. 0:18:28.560 --> 0:18:31.480 So it is just a reminder of how deep, um 0:18:31.520 --> 0:18:34.439 the problems are embedded in our system. Um. Great story 0:18:34.640 --> 0:18:37.000 and appreciate you spending some time with us. Bloomberg News 0:18:37.040 --> 0:18:39.840 p and I reporter Peter rubuson with us on the phone, 0:18:39.840 --> 0:18:41.920 and Seattle of course along with Bloomberg Business we get 0:18:41.920 --> 0:18:44.640 it or Jill Weber on the access line in Brooklyn. 0:18:44.680 --> 0:18:46.640 Catch that story. It will be in the upcoming issue 0:18:46.640 --> 0:18:49.120 of Bloomberg Business Week on news stands later this week. 0:18:49.480 --> 0:18:52.159 Find it online at Bloomberg dot com and also on 0:18:52.200 --> 0:18:56.320 the Bloomberg terminal. The the opening anecdote here is really powerful, 0:18:56.320 --> 0:18:58.760 the idea that a more expensive apartment in in in 0:18:58.800 --> 0:19:01.560 a non white area you can't get the services that 0:19:01.600 --> 0:19:06.119 you get for a less expensive home in a predominantly 0:19:06.119 --> 0:19:09.199 white suburb. I love though this series to Tim that, 0:19:09.320 --> 0:19:11.119 and I think Joel tapped into this. It's like, so 0:19:11.200 --> 0:19:14.720 much of wealth creation is about property for Americans, and 0:19:14.800 --> 0:19:17.640 so if there's any kind of holding back on that 0:19:17.640 --> 0:19:21.200 that's going to impact a family's ability, of minority family's 0:19:21.240 --> 0:19:23.879 ability and abilities to maybe creates some wealth. You're listening 0:19:23.920 --> 0:19:28.840 to Bloomberg Radio. This is Bloomberg Business Week with Carol 0:19:28.920 --> 0:19:33.359 Messer and Bloomberg Quick Takes. Tim Stinovic on Bloomberg Radio. 0:19:33.800 --> 0:19:35.960 We've talked about one of the biggest stories of the day. 0:19:35.960 --> 0:19:39.000 That is, of course Microsoft buying Activision Blizzard and nearly 0:19:39.119 --> 0:19:41.920 sixty billion dollar all cash deal. The other big one 0:19:41.920 --> 0:19:44.320 has of course to do with Goldman Sacks. We're in 0:19:44.359 --> 0:19:45.840 the midst of bank earnings right now, and we did 0:19:45.880 --> 0:19:48.159 hear from Goldman Sacks early in the day equity traders 0:19:48.200 --> 0:19:50.280 posting a decline in the fourth quarter. Revenue from the 0:19:50.280 --> 0:19:54.560 trading operation slits seven percent and equities business declined eleven 0:19:54.960 --> 0:19:58.560 But compensation and benefits, that is what we've all got 0:19:58.560 --> 0:20:00.320 our eyes on. Does feel like Tim and a big way. 0:20:00.320 --> 0:20:02.560 We're getting a reset from the reset from the big banks. 0:20:02.560 --> 0:20:05.120 You heard it from the Morgan and the others last week, 0:20:05.160 --> 0:20:07.239 and I feel like we're getting more from Goldman. Well, 0:20:07.320 --> 0:20:08.920 let's get well, let's get a little bit of insight 0:20:08.960 --> 0:20:11.880 from Shanelli bassk Wall Street reporter for Bloomberg News. I 0:20:11.960 --> 0:20:14.600 checked when I was reading this morning what time Shanali 0:20:14.640 --> 0:20:16.760 got in, because I was like, Okay, it's bank earnings week. 0:20:17.000 --> 0:20:18.960 It means she's getting in at five am. She's still 0:20:19.000 --> 0:20:21.160 here to hang out with us, and we're very grateful 0:20:21.359 --> 0:20:23.320 for that. Shinali. What do we need to know from 0:20:23.400 --> 0:20:26.240 from Goldman Sacks? We've had a few hours to digest it. Yeah, 0:20:26.280 --> 0:20:28.320 there's some sticker shock when it comes to how much 0:20:28.400 --> 0:20:31.880 compensation is rising on Wall Street. And when I spoke 0:20:31.920 --> 0:20:34.280 to the co founder of Carlisle today, you know, what 0:20:34.320 --> 0:20:37.480 he really says is that this is defying gravity. But 0:20:37.560 --> 0:20:41.200 at the same time you have this thirty jumping compensation expenses. 0:20:41.280 --> 0:20:44.800 That's the rise you saw in Goldman's revenue, and you 0:20:44.920 --> 0:20:48.480 saw that jump the bigger in percentage terms, more than 0:20:48.560 --> 0:20:52.399 double what you saw JP Morgan. But JP Morgan's overall 0:20:52.480 --> 0:20:55.840 cost of compensation benefits is much higher because they just 0:20:55.880 --> 0:20:58.320 have such a large work for us across the United States. 0:20:58.720 --> 0:21:00.720 So the thing I have to say to you guys 0:21:00.720 --> 0:21:03.040 that a lot of people are missing is it's not 0:21:03.160 --> 0:21:06.440 just compensation costs that are rising for the banks. There's 0:21:06.520 --> 0:21:11.040