WEBVTT - Bloomberg Businessweek Weekend - March 28th, 2025 0:00:02.759 --> 0:00:07.240 Bloomberg Audio Studios, Podcasts, radio News. 0:00:08.640 --> 0:00:13.000 This is Bloomberg business Week Daily reporting from the magazine 0:00:13.000 --> 0:00:17.599 that helps global leaders stay ahead with insight on the people, companies, 0:00:17.640 --> 0:00:22.520 and trends shaping today's complex economy. Plus global business finance 0:00:22.560 --> 0:00:26.280 and tech news as it happens. The Bloomberg Business Weekdaily 0:00:26.400 --> 0:00:31.320 Podcast with Carol Masser and Tim Steneveek on Bloomberg Radio. 0:00:31.840 --> 0:00:34.800 Hi everyone, Welcome to the Bloomberg Business Week Weekend Podcast. 0:00:35.000 --> 0:00:39.000 Big focus this week for US continuing news out of Washington, DC. Yes, 0:00:39.159 --> 0:00:42.560 that security breach involving the use of the Signal chat 0:00:42.560 --> 0:00:46.680 app and the inadvertent inclusion of a journalist. The full 0:00:46.720 --> 0:00:49.120 coverage of that and the latest can be found on 0:00:49.159 --> 0:00:51.560 the Bloomberg and at Bloomberg dot com. The other big 0:00:51.600 --> 0:00:54.520 focus though out of Washington, Yeah, lots and lots of 0:00:54.560 --> 0:00:56.120 tariff talk and action. 0:00:56.720 --> 0:01:00.720 The President announced a twenty five percent tariff on audio imports, 0:01:01.160 --> 0:01:04.480 expanding a trade war designed to bring more manufacturing jobs 0:01:04.520 --> 0:01:07.880 to the US. Also setting the stage train even broader 0:01:07.920 --> 0:01:11.360 push on levies in the coming weeks and so on. 0:01:11.440 --> 0:01:14.720 Tariff's Trump policy is in an uncertain environment. A few 0:01:14.760 --> 0:01:17.759 members of the C suite way in including Seamen's health 0:01:17.760 --> 0:01:20.679 and heir CFO and the CEO of Sension Jet. 0:01:20.560 --> 0:01:23.160 Also coming up a gut check on the AI spend 0:01:23.200 --> 0:01:26.680 with hpees CEO who was at Nvidia's recent big event 0:01:27.000 --> 0:01:30.440 and caught up with Nvidia's Jensen Wong. And the next hour, 0:01:30.600 --> 0:01:34.000 the journalist who has been searching fifteen years for the 0:01:34.080 --> 0:01:37.320 creator of bitcoin hasn't found him yet, has he? 0:01:37.400 --> 0:01:37.680 God? 0:01:38.000 --> 0:01:38.240 Do you know? 0:01:38.440 --> 0:01:39.120 So you'll have to listen. 0:01:39.200 --> 0:01:40.840 You'll have to read the book or listen to the interview. 0:01:41.000 --> 0:01:41.960 Wait, did I just give it away? 0:01:42.040 --> 0:01:44.280 You get all that to come? We begin with someone 0:01:44.319 --> 0:01:47.240 who's been investing in lots of market cycles. We're talking 0:01:47.280 --> 0:01:50.840 about Barry Ridtholts. He's the host of Bloomberg Masters in Business. 0:01:50.960 --> 0:01:54.360 It's a broadcast and a podcast. Barry's the co founder, chairman, 0:01:54.400 --> 0:01:58.160 and chief investment officer of Ridtholt's Wealth Management. He's got 0:01:58.160 --> 0:01:59.840 a new book out. It's called How Not To in 0:02:00.640 --> 0:02:04.160 the ideas, numbers and behaviors that destroy wealth and how 0:02:04.200 --> 0:02:07.040 to avoid them. Barry joined us earlier in the week 0:02:07.080 --> 0:02:09.840 as we were coming off comments from President Trump at 0:02:09.840 --> 0:02:10.440 the White House. 0:02:10.800 --> 0:02:14.920 There's this sort of narrative fallacy, hindsight bias that we 0:02:15.080 --> 0:02:18.399 all engage in. We don't know what's going to happen tomorrow, 0:02:18.840 --> 0:02:22.519 but after it happens, we have this perfectly rational explanation 0:02:22.600 --> 0:02:27.160 as to why the Wall Street narrative following the election. 0:02:27.880 --> 0:02:30.760 We had an election, it was decisive, It didn't go 0:02:30.800 --> 0:02:35.160 on for days as some people forecast for better or worse. 0:02:35.240 --> 0:02:40.000 There was a clear outcome, and Markets rallied in anticipation of, Hey, 0:02:40.040 --> 0:02:43.760 this is going to be a business friendly administration. We're 0:02:43.760 --> 0:02:46.920 going to get tax cuts, we can get deregulations. Everybody 0:02:46.960 --> 0:02:52.079 party in Markets rallied pretty much up until the chaos 0:02:52.720 --> 0:02:56.639 began with the tariffs. Tariffs are on Monday, they're off Tuesday, 0:02:56.680 --> 0:02:58.919 they're on Wednesday. Was back and forth, Hey we're gonna 0:02:58.919 --> 0:03:01.800 have tarffs with Mexico Canada, all right now the tariffs 0:03:01.840 --> 0:03:03.600 are not with Mexico and care well, maybe we'll have 0:03:03.680 --> 0:03:08.200 tar and then so the narrative was this administration is 0:03:08.280 --> 0:03:12.400 fostering chaos. Nobody can make a CAPEX investment because we 0:03:12.440 --> 0:03:14.080 don't know what the rules are going to be. We 0:03:14.120 --> 0:03:18.160 don't know where we want to locate factories. We were told, hey, 0:03:18.160 --> 0:03:20.720 we could build stuff in North America and it'll be 0:03:20.800 --> 0:03:26.320 tariff free. Forty five negotiated the new NAFTA agreement. Forty 0:03:26.360 --> 0:03:30.600 seven is complaining. It's the same guy. So we ended 0:03:30.680 --> 0:03:35.400 up with this new narrative, all of this chaos is 0:03:35.440 --> 0:03:40.000 bad for business. And then the comments came out from 0:03:40.040 --> 0:03:43.640 President Trump, Well, maybe we could make these more focused 0:03:43.680 --> 0:03:46.320 and more targeted, and maybe it doesn't have to be 0:03:46.400 --> 0:03:51.520 this broad, and so the narrative changes. And when we're 0:03:51.600 --> 0:03:55.640 looking at this, if you're about to retire, you have 0:03:55.720 --> 0:03:59.280 every right to be concerns about all this chaos. But 0:03:59.360 --> 0:04:02.760 if you're not retiring for a decade, well then maybe 0:04:02.800 --> 0:04:05.280 you should look past the next four or maybe it's 0:04:05.400 --> 0:04:09.160 two years, and worry less about the chaos and worry 0:04:09.240 --> 0:04:13.080 more about how your portfolio is going to look six 0:04:13.160 --> 0:04:15.560 years after this president leaves the White House. 0:04:15.600 --> 0:04:19.080 In your book, you have a chapter titled bad Behavior, 0:04:19.080 --> 0:04:21.920 and there's a section why politics and investing don't mix. 0:04:22.480 --> 0:04:26.120 And so is that mix even a greater risk in 0:04:26.160 --> 0:04:28.359 the Trump administration? Or no? Is it just kind of 0:04:28.360 --> 0:04:30.599 politics as usual? And we'll have to wait to see 0:04:30.640 --> 0:04:32.480 how everything settles down. 0:04:32.600 --> 0:04:35.080 So here's a sentence I never thought I would say, 0:04:35.120 --> 0:04:38.840 but I'm going to say it. Trump's genius is his 0:04:38.960 --> 0:04:44.839 ability to capture the attention of the viewing public. Biden 0:04:44.960 --> 0:04:48.000 didn't have, you know, a white house full of media 0:04:48.600 --> 0:04:53.320 over every signing, over every executive order, over every random thing. 0:04:53.360 --> 0:04:56.039 You didn't see that with Obama. You didn't see that 0:04:56.080 --> 0:04:56.840 with George W. 0:04:56.920 --> 0:04:57.160 Bush. 0:04:57.200 --> 0:05:01.480 You didn't see that with Clinton. He is a master communicator, 0:05:01.920 --> 0:05:06.560 and because of it, the noise level ramps up. When 0:05:06.600 --> 0:05:10.200 we look at the odds of odds of a recession, 0:05:10.279 --> 0:05:13.440 odds of a volatility, of a market crash, of a 0:05:13.520 --> 0:05:18.560 dollar collapse, of a geopolitical event, they were low before 0:05:18.640 --> 0:05:23.159 January twentieth. They're still relatively low, but all of them 0:05:23.400 --> 0:05:26.320 have moved higher. I'm not saying we're getting a recession, 0:05:26.360 --> 0:05:28.360 we're getting a crash. I'm not saying any of that. 0:05:28.839 --> 0:05:33.400 They're still relatively I want to say the Wall Street 0:05:33.400 --> 0:05:37.800 consensus was up from ten to fifteen percent chance recession 0:05:38.240 --> 0:05:39.599 to thirty thirty five percent. 0:05:39.680 --> 0:05:42.560 Now that means that the changed. 0:05:43.120 --> 0:05:45.440 It's a change, and it's not in the direction we like. 0:05:45.880 --> 0:05:49.279 But it's not. Hey, there's a sixty eight percent chance 0:05:49.320 --> 0:05:53.880 of recession. It's still relatively low. The problem isn't just 0:05:53.920 --> 0:05:58.080 that it's elevated. The problem is that the chaos is 0:05:58.080 --> 0:06:02.160 starting to increase the probabilities. Look, no one knows the future, 0:06:02.320 --> 0:06:06.479 but business people make investments when they have at least 0:06:06.520 --> 0:06:09.000 a modicum of clarity. Hey, we know what the rules 0:06:09.040 --> 0:06:10.320 are going to be, we know what the tax code 0:06:10.400 --> 0:06:12.520 is going to look like. We know here's where we're 0:06:12.560 --> 0:06:16.560 going to spend our CAPEX dollars to generate a return. 0:06:17.120 --> 0:06:20.600 And when all bets are off, everybody kind of freezes 0:06:20.640 --> 0:06:24.560 and says, I can't deploy millions or tens or hundreds 0:06:24.600 --> 0:06:26.880 of millions unless I know is this going to be 0:06:26.920 --> 0:06:29.000 tariff this, this is going to be taxed? What are 0:06:29.040 --> 0:06:31.640 the rules going to be about this? And that increases 0:06:31.680 --> 0:06:33.440 the chance of an economic slowdown. 0:06:33.720 --> 0:06:36.240 Hey, Barry on the book. It's your first book in 0:06:36.279 --> 0:06:37.160 what fifteen years? 0:06:37.240 --> 0:06:40.120 Yeah, I'm like clockwork, So crank them out. So twenty 0:06:40.200 --> 0:06:41.800 forty the next the sequel with it. 0:06:41.839 --> 0:06:45.680 Does coincide with the rise of your firm, for sure, absolutely, 0:06:45.760 --> 0:06:49.600 And I'm wondering if this is the culmination of what 0:06:49.640 --> 0:06:52.800 you learned speaking to clients about mistakes that they've made 0:06:52.839 --> 0:06:54.720 that their advisors in the past had made before they 0:06:54.760 --> 0:06:57.160 came over to you. What is it a culmination of. 0:06:57.279 --> 0:07:01.080 So I've been writing in public for home almost thirty years, 0:07:01.800 --> 0:07:05.200 and a lot of times, you know, as I've become 0:07:05.360 --> 0:07:09.960 better known to Wall Street into the investing audience, when 0:07:10.000 --> 0:07:13.240 you put something out there. I remember putting out the 0:07:13.400 --> 0:07:17.280 Pimco bonus. It was the top of the terminal for 0:07:17.320 --> 0:07:19.840 six months. I got a million letters emails about that. 0:07:20.560 --> 0:07:23.720 I've done other pieces more recently where there's been in 0:07:23.760 --> 0:07:26.680 the beginning of the pandemic. It came out April first. 0:07:26.760 --> 0:07:29.280 People thought it was an April fool's joke. Don't assume 0:07:29.320 --> 0:07:32.800 the pandemic ended the secular bull market. So it's nice 0:07:32.840 --> 0:07:36.680 putting stuff out and generating a response. Early in my 0:07:36.840 --> 0:07:39.640 career I would write stuff and you would get crickets. 0:07:39.960 --> 0:07:42.400 There's a chapter in the book on a very famous 0:07:42.720 --> 0:07:47.360 cover of Fortune magazine May two thousand, why Cisco is 0:07:47.400 --> 0:07:49.920 the one stock you have to own. And I wrote 0:07:49.920 --> 0:07:53.600 something up about it and didn't hear like, not even 0:07:53.640 --> 0:07:56.960 an angry email. It was just, you know Howard Marx 0:07:57.040 --> 0:08:02.560 used to talk about in the early days of his notes, 0:08:02.920 --> 0:08:05.200 they would print them out, fold them, stick them and 0:08:05.320 --> 0:08:07.480 envelopes and mail them out. And I said, what was 0:08:07.520 --> 0:08:11.760 the response crickets. It wasn't until his infamous Amazon dot 0:08:11.800 --> 0:08:15.360 bom in late ninety nine that he finally got some 0:08:15.400 --> 0:08:21.400 sort of response, And I very much appreciate his journey. 0:08:21.440 --> 0:08:24.320 So a lot of this is kind of thinking about 0:08:24.880 --> 0:08:27.720 you know, I have a huge advantage of having hold 0:08:27.920 --> 0:08:31.480 a lot of people out, or a lot of media 0:08:31.720 --> 0:08:36.160 and Wall Street analysts and fund managers statements, or at 0:08:36.240 --> 0:08:39.439 least noted them, maybe not call them out, but noted them. 0:08:39.480 --> 0:08:41.520 And now I have the advantage of being able to 0:08:41.559 --> 0:08:44.880 look back and seeing who was right and who was wrong. 0:08:45.600 --> 0:08:49.320 PS the Cisco column twenty percent off, it's all time 0:08:49.400 --> 0:08:52.920 high at the time in May two thousand. The stock 0:08:52.960 --> 0:08:56.920 proceeds to fall over ninety percent. It is today a 0:08:57.080 --> 0:09:01.800 quarter century later, still below where that magazine cover was. 0:09:01.880 --> 0:09:04.920 So it's fun kind of going back and looking at 0:09:04.920 --> 0:09:07.960 a lot of these things. A lot of the ideas 0:09:07.960 --> 0:09:11.040 in there. Some came from clients, some came from medias, 0:09:11.080 --> 0:09:14.120 and some came from prospective clients. Hey, I'd like to 0:09:14.160 --> 0:09:17.960 give you money, but you have to answer explain this 0:09:18.040 --> 0:09:21.080 to me. So you know, there's a discussion in there. 0:09:21.480 --> 0:09:25.640 How come during the pandemic the market was detached from reality. 0:09:26.000 --> 0:09:28.920 I drove through my neighborhood and this dry cleaner was closed, 0:09:28.920 --> 0:09:31.679 and this restaurant was closed, and all these shops were 0:09:31.679 --> 0:09:35.199 doing poorly. And the answer was those companies a aren't 0:09:35.240 --> 0:09:40.600 publicly traded, and even the companies that were publicly traded airlines, hotels, 0:09:41.480 --> 0:09:45.200 all sorts of services like that, they're relatively tiny compared 0:09:45.240 --> 0:09:51.000 to big, global multinational companies that aren't dependent on a 0:09:51.080 --> 0:09:55.320 chain of restaurants. Can't compare to Microsoft or Apple or Amazon. 0:09:55.720 --> 0:09:57.400 They're global and they're giant. 0:09:57.720 --> 0:10:00.760 I am curious in terms of the converse you've had 0:10:00.800 --> 0:10:02.960 over the years and the ones that are featured on 0:10:03.720 --> 0:10:07.760 Masters of Business. Are there certain people that I don't 0:10:07.800 --> 0:10:11.000 know changed maybe the way you think about investing that 0:10:11.040 --> 0:10:12.400 really just struck with you. I'm not going to ask 0:10:12.440 --> 0:10:14.160 you for your favorite guests, because I think that's not fair. 0:10:14.200 --> 0:10:16.679 I think it's obvious when you talk to people that 0:10:16.720 --> 0:10:19.480 you really just like talking to these individuals and getting their. 0:10:19.520 --> 0:10:21.319 They're fascinating, They're absolutely fast, and. 0:10:21.280 --> 0:10:24.000 You really get into their stories like what makes them 0:10:24.040 --> 0:10:27.720 tick or you know where they grow up and how 0:10:27.720 --> 0:10:31.640 their you know, professional life came to be. But is 0:10:31.640 --> 0:10:33.800 there somebody that kind of really stands out for you. 0:10:34.760 --> 0:10:37.280 There's a few people that stand out. But I'm going 0:10:37.320 --> 0:10:39.760 to answer a slightly different question than the one you ask. 0:10:39.920 --> 0:10:41.080 That's because he likes ask question. 0:10:41.400 --> 0:10:45.920 So there are a number of guests I really have 0:10:46.120 --> 0:10:49.120 grown to appreciate in the door, and there are groups 0:10:49.160 --> 0:10:52.120 of people they're just charming and lovely and generous and 0:10:52.160 --> 0:10:55.040 what have you. But you know, the first couple of 0:10:55.080 --> 0:10:58.160 times you hear a billionaire tell you, hey, you know, 0:10:58.280 --> 0:11:00.640 luck really plays a big role in this and you 0:11:00.679 --> 0:11:03.320 need to have humility, It's like, yeah, yeah, sure, thanks. 0:11:03.679 --> 0:11:07.040 The second time, the third time when the tenth Nobel 0:11:07.080 --> 0:11:12.320 Laureate CEO billionaire says, hey, you know, someone says this 0:11:12.400 --> 0:11:16.120 is all about smarts and hard work. Howard Marx once said, 0:11:16.480 --> 0:11:18.680 I went to I think it was Columbia Business School. 0:11:18.960 --> 0:11:22.040 Everybody that was smart and hard working, right, Not everybody 0:11:22.080 --> 0:11:26.800 there became billionaires. To paraphrase, he goes, sometimes you know, 0:11:26.840 --> 0:11:28.199 you just got to be the right place at the 0:11:28.280 --> 0:11:31.760 right time. You get a little lucky. I'm genuinely shocked 0:11:31.960 --> 0:11:38.120 how many of these people are just absolutely shockingly humble 0:11:38.240 --> 0:11:41.959 given their success and willing to talk about Listen, when 0:11:41.960 --> 0:11:45.240 you tell people the world, the universe is random, and 0:11:45.440 --> 0:11:49.599 sometimes stuff happens. And didn't see that company, no, and 0:11:49.720 --> 0:11:52.360 saw the pandemic come certainly wasn't in any Wall Street 0:11:52.400 --> 0:11:55.760 forecasts twenty twenty global economy shuts down by the way, 0:11:55.800 --> 0:11:59.240 the stock market's going to scream higher, or the Ukraine invasion, 0:11:59.400 --> 0:12:03.000 or stocks and bonds down double digits, nobody in one year. 0:12:03.400 --> 0:12:07.400 So within the book there's a little bit of a theme. 0:12:08.240 --> 0:12:12.920 Humility is sorely missing on Wall Street, and sometimes you 0:12:13.000 --> 0:12:16.280 just have to be aware of how random so much 0:12:16.640 --> 0:12:19.840 of life is. With that kind of weeze lance, I 0:12:19.880 --> 0:12:24.000 will tell you spending time with Danny Kahneman was a delight. 0:12:25.000 --> 0:12:29.040 I'm a giant fan of Michael Mobison. I mentioned Howard 0:12:29.080 --> 0:12:32.080 Marks is there, Like if you get to spend time 0:12:32.640 --> 0:12:36.480 with a Dick Thaylor, Oh my god, he's just charming 0:12:36.559 --> 0:12:40.640 and delightful and witty, and you know any all these 0:12:40.679 --> 0:12:44.880 people have. People are genuinely surprised when I say, you know, 0:12:44.920 --> 0:12:47.439 the pen is mightier than the sword. The Paul Krugman, 0:12:47.600 --> 0:12:51.760 how you know he's he writes brutal pieces. In real 0:12:51.800 --> 0:12:54.680 life he's a pussy cat. Like if you met him 0:12:55.040 --> 0:12:58.280 and didn't know that he was Nobel laureate in Times 0:12:58.640 --> 0:13:01.600 Acid Pens columnists, you would think, oh, that was a 0:13:01.600 --> 0:13:02.319 really lovely guy. 0:13:02.320 --> 0:13:02.760 Who is he? 0:13:03.320 --> 0:13:08.640 And that's my favorite part of hosting the podcast is 0:13:08.840 --> 0:13:11.600 just kind of getting to learn who these people are 0:13:11.720 --> 0:13:12.959 behind the public images. 0:13:13.480 --> 0:13:15.920 So what's the mistake that you'd say most people make 0:13:15.960 --> 0:13:17.080 when it comes to investing? 0:13:17.280 --> 0:13:18.840 How they should not invest? 0:13:19.080 --> 0:13:21.840 So the biggest mistake we all make is we just 0:13:22.040 --> 0:13:25.800 interfere with the genius of the market. We interfere with 0:13:25.880 --> 0:13:30.559 the market's ability to compound wealth over time. Like if 0:13:30.600 --> 0:13:33.320 you just allow the market to do its thing and 0:13:34.240 --> 0:13:37.920 just stay out of its way, your way ahead of 0:13:39.200 --> 0:13:43.080 you know, we know the handful of outliers who have 0:13:43.240 --> 0:13:47.720 managed to generate above market returns consistently over time. Warren 0:13:47.760 --> 0:13:50.720 Buffett comes to me right their household names, Peter Lynch, 0:13:50.800 --> 0:13:54.600 Jim Simon's of Renaissance Technologies. Like there's a few dozen 0:13:54.679 --> 0:13:59.760 of them. Jim Chanosa of Kinnicos Associates said, noted sortseller right, 0:13:59.800 --> 0:14:02.679 when he launched his hedge funds in the eighties, there 0:14:02.679 --> 0:14:06.080 were one hundred hedge funds. They all generated alpha. Now 0:14:06.080 --> 0:14:09.800 there's eleven thousand hedge funds the same hundred more or 0:14:09.880 --> 0:14:12.800 less of the ones generating alpha, and so you know 0:14:12.880 --> 0:14:18.959 that's kind of instructive. It is extremely hard to consistently 0:14:18.960 --> 0:14:22.200 beat the market neta fees over time, and the people 0:14:22.240 --> 0:14:26.880 who do are rewarded with great success, fame, riches, and 0:14:26.920 --> 0:14:29.840 a handful of them we know because they're so few 0:14:29.880 --> 0:14:30.960 and far between. 0:14:30.840 --> 0:14:34.000 Really quickly thirty forty seconds. Because there's tons of investment 0:14:34.040 --> 0:14:35.560 books out there, How do you want someone to use 0:14:35.560 --> 0:14:37.120 this book? How should they use this book? 0:14:37.240 --> 0:14:40.280 So the question I ask every guest at the end 0:14:40.320 --> 0:14:42.560 of the podcast is what do you know today? You 0:14:42.680 --> 0:14:45.280 wish you knew thirty years ago or forty or fifty 0:14:45.320 --> 0:14:48.760 when you're first starting out. And someone turned that around 0:14:48.840 --> 0:14:51.120 on me, and this book is what I would have 0:14:51.240 --> 0:14:54.640 loved to have when I started, because every mistake in 0:14:54.680 --> 0:14:58.480 that book I have made and made repeatedly, and had 0:14:58.480 --> 0:15:00.480 I had that, maybe would have done. 0:15:00.520 --> 0:15:03.640 You invested a billion dollars into gold. I didn't do that. 0:15:03.640 --> 0:15:06.880 I didn't make that mistake, but I did pass on 0:15:06.920 --> 0:15:09.760 the seed round of robin Hood and my friend who 0:15:09.800 --> 0:15:12.000 did put money into it made one hundred million dollars. 0:15:12.040 --> 0:15:13.680 So I'm a Jeanie. 0:15:13.600 --> 0:15:16.520 Very, if you made a hundred million dollars, you would 0:15:16.520 --> 0:15:17.600 still be sitting here with us. 0:15:17.720 --> 0:15:20.480 Probably. You know, I love the puzzle of the market, 0:15:20.520 --> 0:15:21.480 so I'm fascinated book. 0:15:21.640 --> 0:15:24.120 You really do. Fun to get some time with you. 0:15:24.200 --> 0:15:27.760 Congratulations on the book. My pleasure very rich almuch co founder, chairman, 0:15:27.800 --> 0:15:30.520 chief investment officer Ridholt's Wealth Management his new book, How 0:15:30.560 --> 0:15:33.880 Not to Invest The ideas, numbers and behaviors that destroy 0:15:34.000 --> 0:15:37.400 wealth and How to avoid them. Also host of Masters 0:15:37.400 --> 0:15:40.040 in Business on Bloomberg Radio and Bloomberg Podcast. You can 0:15:40.120 --> 0:15:42.920 download it at Bloomberg dot com or wherever you get 0:15:42.920 --> 0:15:43.400 your podcast. 0:15:43.440 --> 0:15:52.120 Partly you're listening to the Bloomberg Business Weekdaily podcast. Catch 0:15:52.200 --> 0:15:55.440 us live weekday afternoons from two to five pm Eastern. 0:15:55.600 --> 0:15:58.640 Listen on Applecarplay and the Android Auto with the Bloomberg 0:15:58.680 --> 0:16:02.200 Business app, or just live on YouTube. 0:16:02.480 --> 0:16:04.800 There was one story that caught our attention because it 0:16:04.880 --> 0:16:06.960 just seemed to tie in so well with our next guest, 0:16:07.280 --> 0:16:09.440 Astra Zeneca will invest two and a half billion dollars 0:16:09.480 --> 0:16:11.720 in a new research center in Beijing in a major 0:16:11.760 --> 0:16:15.280 show of commitment to China, just months after that company's 0:16:15.320 --> 0:16:18.360 top executive there was detained by authorities. We know it 0:16:18.440 --> 0:16:21.720 is so complicated doing business globally today. Our next guest 0:16:21.760 --> 0:16:24.240 has separate supply chains for China and Asia and their 0:16:24.280 --> 0:16:27.360 Western clients, which safe to say comes in pretty handy 0:16:27.440 --> 0:16:29.600 right now. Here to talk about that and more is 0:16:29.600 --> 0:16:34.200 Siemens Healthenier's chief financial officer, Johan Schmidts. Johan joins us 0:16:34.240 --> 0:16:38.080 from Munich, Germany, along with our own Nina Trentman. She's 0:16:38.120 --> 0:16:40.600 here in our studio. She's senior editor at Bloomberg News, 0:16:40.800 --> 0:16:43.240 author of the CFO Briefing newsletter, which you can sign 0:16:43.320 --> 0:16:47.040 up for at Bloomberg dot com slash CFO Briefing. Jahan. 0:16:47.280 --> 0:16:49.720 Great to have you here with us. There's a lot 0:16:49.760 --> 0:16:51.480 to talk about. I do want to start with supply 0:16:51.560 --> 0:16:55.400 chains because I feel like that and tariffs and globalization 0:16:55.600 --> 0:16:57.800 is so much front and center right now. Talk to 0:16:57.880 --> 0:17:00.400 us about how you manage it, build it, think about it, 0:17:00.440 --> 0:17:03.280 and how what you have today came together. 0:17:04.000 --> 0:17:06.000 Yeah, thank you very much first for having me. 0:17:06.960 --> 0:17:11.920 When I think about our global value add footprint we 0:17:12.080 --> 0:17:15.280 have as as you're right for you said in the beginning, 0:17:15.320 --> 0:17:19.080 we have so to say, a two side so to 0:17:19.119 --> 0:17:24.639 say two side strategy. We manufacture and develop everything for 0:17:24.920 --> 0:17:29.239 China and for the China block out of China, and 0:17:29.359 --> 0:17:34.359 we manufacture and and develop everything else in the also 0:17:34.400 --> 0:17:38.439 in the in the Western world. That means we have 0:17:38.520 --> 0:17:42.879 relatively detached two value chains in place. 0:17:43.040 --> 0:17:43.640 Now, this is. 0:17:43.600 --> 0:17:47.399 A Karlie I would say for the current situation, a 0:17:48.119 --> 0:17:52.080 kind of a comfortable setup because we are not affected, 0:17:52.119 --> 0:17:57.119 so to say, too much by the geopolitical or terriff 0:17:57.200 --> 0:18:02.960 discussion between so far between United States and China. And 0:18:03.320 --> 0:18:06.679 when we look at our global footprint in the Western world, 0:18:07.359 --> 0:18:11.320 twenty five percent of our employees are in the United States. 0:18:11.880 --> 0:18:15.560 We have four segments. Two of the segments are headquartered 0:18:15.680 --> 0:18:21.359 or the United States, or seventeen thousand total employees seventeen thousand, 0:18:21.359 --> 0:18:24.000 As I said, twenty five percent are in the United States. 0:18:24.040 --> 0:18:28.080 So we are well spread across the world. 0:18:28.200 --> 0:18:32.119 And this gives us a decent resilience. Yeah, but it 0:18:32.160 --> 0:18:34.359 does not make us immune against global trade wars. 0:18:34.359 --> 0:18:35.480 And I would to say this. 0:18:35.840 --> 0:18:38.440 Yeah, to follow up on that, Johan, thanks for joining 0:18:38.520 --> 0:18:42.480 us talk to us about the Trump terraffs. Of course, 0:18:42.520 --> 0:18:45.040 a lot of moving parts, but how do you think 0:18:45.080 --> 0:18:47.919 about those and could there be an impact on your business, 0:18:48.000 --> 0:18:49.960 given that you have a strong US footprint. 0:18:51.080 --> 0:18:53.080 First of all, let me look at what is currently 0:18:53.160 --> 0:18:59.679 in place the Mexico, Kada, and China additional terrorists. As 0:18:59.720 --> 0:19:02.160 I said, China is not a major topic for US 0:19:02.160 --> 0:19:06.720 because the latest since Trump one or zero, we to 0:19:07.040 --> 0:19:09.959 change our supply chains so that they are detached from 0:19:10.000 --> 0:19:13.480 each other. We have i would say, some impact from 0:19:14.080 --> 0:19:18.600 some sub supply from Mexico into the United States for 0:19:18.920 --> 0:19:23.600 one of our two headquartered business in the United States 0:19:23.720 --> 0:19:26.840 or Wearian business at the West Coast. This is I 0:19:26.840 --> 0:19:31.000 would say, the major impact. But it's not a huge topic. 0:19:31.040 --> 0:19:31.919 It's a so far. 0:19:31.880 --> 0:19:35.879 Small topic Canada, US so far not a big topic 0:19:35.920 --> 0:19:36.399 for US. 0:19:36.960 --> 0:19:38.920 And to follow up on that, have you had any 0:19:39.000 --> 0:19:42.399 sort of conversations with the administration to see if you 0:19:42.440 --> 0:19:45.240 could be exempt from any tariffs? I know that sort 0:19:45.240 --> 0:19:49.960 of Beijing, for example, in its retaliatory tariffs on US 0:19:50.000 --> 0:19:52.200 goods has excluded healthcare. 0:19:52.640 --> 0:19:53.960 Yeah, and obviously we are. 0:19:56.119 --> 0:19:59.840 Trying to get healthcare and together with other companies in 0:19:59.880 --> 0:20:01.520 the the escare sector out. 0:20:01.359 --> 0:20:04.520 Of UH exempt from from terraffs. 0:20:04.760 --> 0:20:07.919 I think that makes a lot of things sense because 0:20:07.920 --> 0:20:11.760 when you think about terriffs, what do they do. They 0:20:11.800 --> 0:20:17.600 will limit the flow of products and services across across 0:20:17.640 --> 0:20:19.879 the world on the one hand, but they're also will 0:20:20.520 --> 0:20:22.840 will limit the flow of knowledge and then it is 0:20:22.880 --> 0:20:24.200 to the detriment of patience. 0:20:24.280 --> 0:20:24.440 Yeah. 0:20:24.440 --> 0:20:29.439 Therefore, when you look at comparable situations like sanctions or others, 0:20:29.760 --> 0:20:33.320 normally healthcare gets excluded over time. And I'm I'm hopeful 0:20:33.359 --> 0:20:37.000 that this will also get into into play in terraffs, 0:20:37.960 --> 0:20:39.120 hopefully sooner than later. 0:20:39.200 --> 0:20:42.960 And Jagam, how do you think about this administration, this 0:20:43.160 --> 0:20:46.760 president versus other world leaders that you've dealt with. How 0:20:46.880 --> 0:20:48.639 how is he different to deal with? How is this 0:20:48.680 --> 0:20:50.160 administration different to deal with? 0:20:50.680 --> 0:20:50.880 Yeah? 0:20:50.880 --> 0:20:55.199 I mean normally, to be honest, when we we in 0:20:55.240 --> 0:20:59.480 the particular in the United States, we do not have 0:20:59.600 --> 0:21:04.400 a lot of business with government. Yeah, because the prior 0:21:04.440 --> 0:21:07.119 to the healthcare system in the United States is primarily 0:21:07.119 --> 0:21:12.840 a private a private system. Therefore, where we look at 0:21:13.080 --> 0:21:16.440 changes in the administration in the United States, the impact 0:21:17.200 --> 0:21:21.640 in general on our business on the healthcare markets are 0:21:22.080 --> 0:21:23.840 for us relatively limited. 0:21:23.920 --> 0:21:26.280 Yeah. And our current. 0:21:26.040 --> 0:21:28.960 Assumption as we see it is also with regard to 0:21:29.000 --> 0:21:32.960 the WES market, we don't see significant disruption at the 0:21:33.000 --> 0:21:36.880 horizon in this regard, and obviously when we look at 0:21:36.880 --> 0:21:41.840 the the Trump administration, it's it's from its It's not 0:21:41.880 --> 0:21:45.280 a surprise what is happening. It was cleared it was 0:21:45.320 --> 0:21:50.119 also mentioned in the campaign that things like this might happen. 0:21:51.119 --> 0:21:55.480 From a strategic standpoint, we need to stay flexible, agile 0:21:55.960 --> 0:21:58.600 because we cannot plan for everything. We will there will 0:21:58.600 --> 0:22:01.520 be surprises, and to try to deal with this as 0:22:02.600 --> 0:22:04.040 as rapidly as possible. 0:22:04.320 --> 0:22:04.879 I am curious. 0:22:05.000 --> 0:22:05.119 You know. 0:22:05.160 --> 0:22:07.440 There was a story actually from daw Jones that talked 0:22:07.440 --> 0:22:09.760 about how you guys are setting up to cancer research 0:22:09.800 --> 0:22:14.120 centers in Alberta, Canada, focusing on oncology training and artificial 0:22:14.200 --> 0:22:16.600 intelligence and machine learning. And I guess what I want 0:22:16.640 --> 0:22:19.200 to ask you is do you see because it does 0:22:19.240 --> 0:22:21.120