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Speaker 2: Father All right, everybody, it has been a wild ride
Speaker 2: for the economy, global bonds, thinking around where rates go
Speaker 2: from here. We talked about yesterday the thirty year surgeon
Speaker 2: to its highest level since two thousand and seven. We
Speaker 2: got some jobs dated today, a little bit of softness,
Speaker 2: so maybe everybody calming down, so we're gonna have a
Speaker 2: great little roundtable because with us right now is Bloomberg
Speaker 2: News Rates reporter Michael McKenzie on zoom in New York
Speaker 2: City and then with a corporate perspective and more because
Speaker 2: he's going to stick around for a couple of blocks.
Speaker 3: Hiss.
Speaker 2: Brad Jacobs. He's founder and executive chair at XPO, co
Speaker 2: founder of United Rentals formature of United Ways. He's been
Speaker 2: described as a serial entrepreneur. He's got a new book out,
Speaker 2: which we're going to get to a little bit later on.
Speaker 2: But Brad is here in our Bloomberg Interactive Broker's studio. Brad,
Speaker 2: thank you so much. We're going to have Michael kind
Speaker 2: of lay out the rate environment. But how much do
Speaker 2: you listen and follow in terms of what's going on
Speaker 2: generally when it comes to rates, because it certainly impacts
Speaker 2: corporations balance sheets.
Speaker 4: Potentially, we pay attention to a lot to them because
Speaker 4: that depends that determines what you want to do with
Speaker 4: your capital spending.
Speaker 5: Do you want to spend more, do you want to
Speaker 5: spend less? Do you want to invest? So pay a
Speaker 5: lot of attention to that.
Speaker 2: Well, Michael COMMANI in on it and then lay it
Speaker 2: out for us because it's been kind of a wild
Speaker 2: ride once again when it comes to global bonds.
Speaker 6: Here it hairs Carol, and I think the story remains.
Speaker 6: People are still trying to work out whereas the top
Speaker 6: and yields, particularly for ten year yields, which matter a
Speaker 6: great deal for the US economy. That's the yield that
Speaker 6: determines mortgages and also it helps determine a lot of
Speaker 6: the corporate borrowing costs. It made a run above four eighty,
Speaker 6: A lot of people talking maybe five percent, but it
Speaker 6: wasn't that long ago. In fact, just a couple of
Speaker 6: weeks ago when we were talking about four to fifty
Speaker 6: was going to be the ceiling. So really, when you
Speaker 6: talk to investors and bond managers, as I've been doing
Speaker 6: for last a few days, there's still a sense of
Speaker 6: shell shock out there.
Speaker 7: Yeah, tell us rad if you want to come in
Speaker 7: here on the logistics perspective, this has got to be
Speaker 7: such a tough environment to operate in right now with
Speaker 7: the idea that interest rates are high, I'm going to
Speaker 7: stay that way for a while. You've got goods demand
Speaker 7: in the economy seems to be waning. I mean, how
Speaker 7: are you managing this right now? And how would you
Speaker 7: describe how the business is doing well?
Speaker 4: Interest rates are higher than what they work They were
Speaker 4: low for a while.
Speaker 5: But I'm an old dog. I remember when interest rates
Speaker 5: were much higher than where they are now.
Speaker 2: But is that an important point because we keep saying perspective.
Speaker 2: I remember working with folks who said, I remember having
Speaker 2: a fifteen sixteen seventy percent mortgage rate.
Speaker 4: I remember when HYO bonds were in the mid teens
Speaker 4: and that was normal, and that was for a number
Speaker 4: of years. And I remember back at a United Rentals
Speaker 4: when Leon Black was on our board, and.
Speaker 2: He of a poll of fame, of course.
Speaker 5: One of the first inventors of the junk bond.
Speaker 4: Now that the high yield called high yield, and I
Speaker 4: remember when when it went down to about ten percent,
Speaker 4: he said, we got to get as much yielded as
Speaker 4: hi yield this issue as much as possible.
Speaker 5: It's never going to go below here.
Speaker 4: Of course it did and stayed there for a long time.
Speaker 4: So I historically we're not at very high levels.
Speaker 2: How do you look at the do we stay maybe here?
Speaker 2: Like how when you think about running businesses or we're
Speaker 2: going to get into you know, your kind of next chapter,
Speaker 2: if you will, But thinking about investing, do you think
Speaker 2: that we're this is kind of the environment we're going
Speaker 2: to be in for a while.
Speaker 4: It depends so that there's in my career, I've never
Speaker 4: seen two simultaneous things that are going on right now, ever,
Speaker 4: going on at the same time.
Speaker 5: So you've got the.
Speaker 4: FED tightening, raising rates, slowing things down in possibly inducing
Speaker 4: a recession. But on the other hand, you have huge
Speaker 4: amount of stimulus going into the economy. So I was
Speaker 4: at the Jeffreys Industrials Conference a few weeks ago sixteen
Speaker 4: or seventeen presentations, half of them had a slide or
Speaker 4: two about how much money they were going to get
Speaker 4: from the Cares Act, from the Infrastructure Act, from Inflation
Speaker 4: Reduction Act. So this all trily is a stimulus. I
Speaker 4: thought naively, I thought that was done. I thought that
Speaker 4: was a couple of years ago. For it's now starting.
Speaker 5: To come up in big amounts.
Speaker 4: So that's inflationary. And yet you have the RAS and
Speaker 4: the rates. So let's just tug of war going on.
Speaker 2: Michael, come on back in, because I think Brad brings
Speaker 2: in a good point right when we talk about the
Speaker 2: amount of money that continues to maybe come into the economy,
Speaker 2: fuel it and continue to put pressure on the inflationary
Speaker 2: side of things, what are the markets telling us about
Speaker 2: monetary policy and inflation at this point.
Speaker 6: Well, he raised a very good point, and I think
Speaker 6: this is what the market has missed, in particularly the
Speaker 6: Bow market beginning to share. They really thought there was
Speaker 6: going to be a recession by now, and that hasn't
Speaker 6: come to fruition. And in fact, the stimutu is coming
Speaker 6: through the Biden infrastructure and other plans is still kicking in.
Speaker 6: So the key here is that's probably going to keep
Speaker 6: employment pretty tight. And that's the one metric that everyone's
Speaker 6: now watching. And until you see employment severely weak and
Speaker 6: then suggest economies on a recessionary path, bond yields are
Speaker 6: going to stay high and they may go higher. And
Speaker 6: I think inflation is still fairly elevated. It's more than
Speaker 6: double the Fed's targets, so that still has going to
Speaker 6: take time to come down. But a sticky inflation environment,
Speaker 6: you know, a Brazilian economy led by the job sector,
Speaker 6: and this fiscal stimulus still coming through from Washington, rates
Speaker 6: are higher for longer.
Speaker 2: I want to I'm curious, Bride, do you have a
Speaker 2: question for a reads guy?
Speaker 5: I do.
Speaker 4: How confident are you in that? What's your level of
Speaker 4: conviction on that? Because most people have gotten this completely
Speaker 4: wrong last couple of years. I remember I was at
Speaker 4: a trade organization for mostly fortune two hundred CEOs about
Speaker 4: a year and a half ago, and we voted on
Speaker 4: the little slideo app of whether we're going to have
Speaker 4: a severe recession or remind recession or no recession, and
Speaker 4: over ninety.
Speaker 2: Percent a conference pol but go ahead yes.
Speaker 4: And and over ninety percent, well over ninety percent said
Speaker 4: it was either going to be a severe recession or
Speaker 4: a minor recession last year. So obviously that never happened.
Speaker 4: So it's how confident are you in your in your
Speaker 4: in your prediction.
Speaker 6: Well, it's it's you made that you made that point bright.
Speaker 6: So I was talking to investors this morning. He said
Speaker 6: he thinks now that rates are at levels where you
Speaker 6: will get a recession next year. However he's still you know,
Speaker 6: that's his gut feel, but he says, I still got
Speaker 6: to check that I'm not confident enough that you know,
Speaker 6: we will get a real slow down. And so therefore
Speaker 6: it really I think the markets it's been saying recession
Speaker 6: recession has been caught out every time. I think it's
Speaker 6: still going to take time for the stimulus to come
Speaker 6: through and wear off. And I think the other real
Speaker 6: factor that I think one of the big changes here
Speaker 6: is at the Bob mark has always been used to
Speaker 6: this idea that ohur frates go up, something breaks, nothing's broken,
Speaker 6: and I think a reason why they haven't really seen
Speaker 6: anything break, outside of course regional banks who've now been
Speaker 6: ring fenced by the FED. And that's a very important
Speaker 6: point because as long as they stay ring fenced, that's
Speaker 6: not going to bleed into the economy as much. But
Speaker 6: I think the key fact here is you've got a
Speaker 6: lot of people sitting on thirty or fixed mortgages below
Speaker 6: three percent who do not want to sell their homes
Speaker 6: and take out a new mortgage. And you've got a
Speaker 6: lot of companies that benefited from borrowing at very low
Speaker 6: rate back in twenty one and twenty twenty, and again
Speaker 6: you're not going to get that corporate bond hit that
Speaker 6: we would have got from higher rates. So look, I
Speaker 6: think it's a fool's eron trying to predict more than
Speaker 6: three six months away. There are some very smart people
Speaker 6: as well, like Jeffrey Gunlack, who I listened to yesterday
Speaker 6: when he was speaking at a conference here in New York,
Speaker 6: saying that he thinks employment will will really start to
Speaker 6: fall apart towards the end of this year because they
Speaker 6: also are coming and they're going to be big. I
Speaker 6: just don't really know, but I think at this point,
Speaker 6: if the perils hold up, the employment holds up, it's
Speaker 6: going to be tough for this bomb market to not
Speaker 6: be higher for longer.
Speaker 4: What chances do you give that will have a Jimmy
Speaker 4: Carter like stagflation the worst of both worlds. We will
Speaker 4: have inflation, it will also have no growth.
Speaker 6: I mean, I mean when I talk to some big
Speaker 6: investors like dan I have some particularly PIMCO, it's a
Speaker 6: tail risk for them. They do worry that wages could
Speaker 6: kick up later this year and you're going to get
Speaker 6: stickier inflation, and then once the economy slowly but surely
Speaker 6: starts to buckle under these high rates, that you will
Speaker 6: get a more stagflationary type environment. I think that remains.
Speaker 6: That's not the base case most people are thinking here
Speaker 6: when you talk to them on the street. Economy will slow.
Speaker 6: We'll probably have a couple of quarters of soft growth,
Speaker 6: maybe one percent or less. But no one's really calling
Speaker 6: for a hard landing recession at this point. Really, when
Speaker 6: you when you when you dig into it, it just seems
Speaker 6: to be where we're probably going to muddle through because
Speaker 6: the stimulus VISI will stimulus, I think is such a
Speaker 6: huge difference to what we've seen in the last decade.
Speaker 6: It just didn't really come through after the global financial
Speaker 6: crisis in two thousand and eight, and that's why we
Speaker 6: just had very low rates for a very long time.
Speaker 6: The FED was doing all the heavy lifting, we weren't
Speaker 6: really undertaking these big stimulus programs that we're now seeing.
Speaker 7: Right, So Michael just threw out a few scenarios for
Speaker 7: us here, Brad, we've got the potential for stagflation, recession.
Speaker 7: Just moneying through it all. What are you preparing for?
Speaker 5: All the above?
Speaker 7: All the above?
Speaker 4: So when you're running a business, you have to you
Speaker 4: first really have to decide is your vision high.
Speaker 5: Conviction or low conviction?
Speaker 4: Right now, it's if you think it's high conviction, then
Speaker 4: you're not right because there's a lot of different scenarios
Speaker 4: here that got it played out, including geopolitical scenarios.
Speaker 5: So you have to prepare for everything.
Speaker 4: You can't just be paranoid and stop investing and stop growing,
Speaker 4: and you have to keep investing in the business, but
Speaker 4: you have to also be prepared for perhaps even a
Speaker 4: sudden downfall.
Speaker 2: What are you most prepared for though? Is it that
Speaker 2: idea that we are all too rosy despite all the
Speaker 2: stimulus money still come from some of the spending programs,
Speaker 2: or is it you know, that's what I'm trying to
Speaker 2: Which way, So you just got about thirty and then
Speaker 2: you're going to come back and talk more so, I chaired.
Speaker 4: Three companies and the answer is a little bit different
Speaker 4: for each company.
Speaker 5: So in the.
Speaker 4: Warehouse business and in the brokerage business, volumes have slowed,
Speaker 4: there's no question about that, and that's not a new
Speaker 4: piece of news. That's been slowly for quite a few months.
Speaker 4: And they haven't bottom and turned back up yet. They've
Speaker 4: slowed and they've staying down the bottom. On the LTL side,
Speaker 4: which is XPO, that's separate from what's going on in
Speaker 4: the macro because it's had two major events that have
Speaker 4: benefited XPO, the bankruptcy of Yellow and then now recently
Speaker 4: one of the biggest private company, SD's has had a
Speaker 4: big cyber attack and.
Speaker 2: They're just down, so that benefits it.
Speaker 5: Yeah, sadly that's a bad thing for them, but it's
Speaker 5: good for expert.
Speaker 2: Bad news good news. I want to get back to
Speaker 2: our guest at this hour, delighted to still have with us,
Speaker 2: Brad Jacobs, founder and executive chair at XPO. I mentioned,
Speaker 2: co founder of United Rental's former chair of United Waste.
Speaker 2: I was doing some reading, I think we both were,
Speaker 2: and he's been described as a numbers guy, a serial entrepreneur,
Speaker 2: and he has a new book coming out, How to
Speaker 2: Make a few Billion dollars still with us in our
Speaker 2: interactive broker studio. Great discussion. Loved having you weigh in
Speaker 2: on kind of these micro data points or moves in
Speaker 2: the market and how you see it on a bigger perspective.
Speaker 2: If you had to describe the business environment right now
Speaker 2: in a word or handful of words, how would you
Speaker 2: do it? Br mixed it, uncertain, mixed it on class
Speaker 2: half full, class half empty or right at the medlaf
Speaker 2: class half Well, okay, so so walk us through, work
Speaker 2: it out. Labor market costs like.
Speaker 5: What is labor market type?
Speaker 4: Still absolutely well, it's not as tight as it was
Speaker 4: during COVID and no comparison. You can actually find workers,
Speaker 4: but wages are up and trending towards up. But you
Speaker 4: can find people. For instance, in the XPO business, we
Speaker 4: can find drivers. During COVID we couldn't find drivers, just
Speaker 4: our base core people, but a lot of people checked
Speaker 4: out and didn't come back.
Speaker 7: It's got to be concerning for I would think a
Speaker 7: lot of CEOs right now looking at all this heightened
Speaker 7: strike activity is there, how would you describe right now,
Speaker 7: like the labor unrest around the country right now, And
Speaker 7: is that something that worries you at.
Speaker 4: All, well as a company executive or as a citizen
Speaker 4: of the country.
Speaker 7: Well, so to give it to us both, but more
Speaker 7: the company executives.
Speaker 4: As a company executive, no, it doesn't bother me at all,
Speaker 4: because we were the target of a Teamsters national campaign
Speaker 4: for seven years and it didn't work, and they left
Speaker 4: and they went on too, Amazon, which is a much bunch,
Speaker 4: bigger fish than XPO.
Speaker 5: So I suppose they're not coming back to us.
Speaker 4: But even if they do, we work so hard at
Speaker 4: creating an environment in the workplace where people are happy
Speaker 4: to come to work and people feel valued and respected
Speaker 4: that that doesn't bother me.
Speaker 7: How do you give them that though? I mean, there's
Speaker 7: so much demand right now for I would think a
Speaker 7: lot of your workers probably need to be in person
Speaker 7: right for the work that they do, and like so
Speaker 7: much of what people want is remote, and like you know,
Speaker 7: is it more in giving them different hours and schedule flexibility?
Speaker 7: What can you give to them?
Speaker 4: Well, if you're a driver or you're a dock worker,
Speaker 4: you can't work the moment need to come in so
Speaker 4: and that's the majority of our workers there, So What
Speaker 4: you have to give them is respecting them, and you
Speaker 4: show respect by paying them properly, by listening to their needs,
Speaker 4: by communicating with them, letting them know what's going on
Speaker 4: in the whole company and how they fit in, showing
Speaker 4: them the letting them have pride in the work by
Speaker 4: Mario Harrick, who's replaced me as CEOs of an amazing job.
Speaker 4: He's done a really, really fantastic focus on making sure
Speaker 4: we don't damage freight, make sure we deliver freight on time,
Speaker 4: which are very important things in our business. And those
Speaker 4: statistics in our company, those metrics have gone off the
Speaker 4: charts in the right direction.
Speaker 3: You know.
Speaker 2: We have a great function on the Bloomberg and it's
Speaker 2: like the supply chain, and it talks about your customers
Speaker 2: and who are your clients basically and who you buy from.
Speaker 2: But your customers include everybody from Amazon, Apple, eight A,
Speaker 2: m Low's, Walmart, home depots, so many more companies. And
Speaker 2: you have a global perspective. Where is though the strongest
Speaker 2: parts of the global economy in your view, and how
Speaker 2: does geopolitics potentially continue to kind of impact that.
Speaker 5: Geopolitics is very important.
Speaker 4: I think the two biggest things are obviously of Vladimir
Speaker 4: Putin and Chi Jimpin, who could single handedly, literally single handedly,
Speaker 4: either of them throw a pretty big monkey ranch into
Speaker 4: the whole world economy. Those are not insignificant possibilities. Those
Speaker 4: are not one percent possibilities. So we have to pay
Speaker 4: attention to that. But we can't be obsessed by that.
Speaker 4: We can't just be held down and just just enamored
Speaker 4: but just that those features.
Speaker 5: So we just keep trucking along.
Speaker 2: But okay, cute, but bred in terms of the pushback
Speaker 2: against you know, the globalization of the economy, and we
Speaker 2: talk about that being pushed back, do you see that
Speaker 2: guy firsthand?
Speaker 4: Yeah, so every so you mentioned before and increasingly so,
Speaker 4: no question, but that she mentioned before some of the
Speaker 4: customers we have, So I'm privileged to have windows into
Speaker 4: g XO RXO XPO where we have a whole cross
Speaker 4: section of customers around the whole world, and so you
Speaker 4: get to see a lot a lot of information what's
Speaker 4: going on, and you also get to interact with a
Speaker 4: lot of customers, a lot of boards of customers, a
Speaker 4: lot of C suite. There's not a single board in
Speaker 4: America that's not who has and has had business in China.
Speaker 4: Who's not thinking I need to diversify away from China.
Speaker 4: It's just the risk is too high.
Speaker 5: So everyone universally is doing that.
Speaker 2: What about the risks in our own political system? Does
Speaker 2: that crop up? Does that bother you? Does that worry you?
Speaker 2: About what happened this week with the Speaker of the House.
Speaker 4: Well, that's the two party system, and that's been going
Speaker 4: on for a couple hundred years.
Speaker 2: Do you consider it functional?
Speaker 5: It's worked for two hundred years.
Speaker 4: I mean, so as a global traveler, I certainly would
Speaker 4: not want to be in any of the countries that
Speaker 4: have one party systems.
Speaker 5: That's the worst.
Speaker 4: I mean, there's a very repressive, horrible cultures. And this
Speaker 4: is a country where, despite everyone fighting with each other
Speaker 4: and calling each other's names and certain levels of dysfunction,
Speaker 4: we unlike China, don't have a million people in prison
Speaker 4: camps because of their religion. We, unlike in Russia, we
Speaker 4: don't have journalists like you. If you criticize the president,
Speaker 4: you go to jail for eight years. So, I mean
Speaker 4: it's still a great country, fantastic country.
Speaker 7: When we're looking at some of the trends in the
Speaker 7: US economy right now, I mean We've been talking about
Speaker 7: for so long, the shift of preferences from goods to services,
Speaker 7: and I would think from your perspective, that's probably the
Speaker 7: last thing you would want to hear. You want people
Speaker 7: to be buying stuff.
Speaker 2: Right, we are good.
Speaker 4: All of the three companies I mentioned move goods one
Speaker 4: way or another. So more goods is better than more services.
Speaker 4: But for the economy as a whole, that's a normal cycle.
Speaker 5: Sometimes it's more goods, sometimes it's more services.
Speaker 4: We're not in the best part of the cycle to
Speaker 4: be in transportation, but there are specific things that each
Speaker 4: one of those three companies are doing that are independent
Speaker 4: of the macro to improve the businesses.
Speaker 2: When it comes to transportation, what are the biggest like
Speaker 2: technology technology trends that you think are going to change it.
Speaker 2: We talk a lot about AI, We talk obviously about
Speaker 2: self driving, Like, what is it that you think is
Speaker 2: the most interesting trends that are going to shape it
Speaker 2: for the next I don't know, fifty years.
Speaker 4: Well, on the GXO side, the warehouse business, where we
Speaker 4: have two hundred and some odd million square feet of
Speaker 4: warehouse about a thousand warehouses. It's the automation of warehouses
Speaker 4: and you continuation of it. Right, Yeah, AI powered robots.
Speaker 4: It's very very sophisticated, futuristic. You can go into a
Speaker 4: warehouse that's huge and there's no people. That was maybe
Speaker 4: ten people, whereas ten years ago there would have been.
Speaker 5: Hundreds of people there.
Speaker 4: So that's a very very big trend on the RXO side,
Speaker 4: which is a tech ford brokerage platform there. When I
Speaker 4: first hired Mario Harrick, who stayed behind at XPO as CEO,
Speaker 4: but then Drew Wilkerson became the CEO of RXO. When
Speaker 4: I first hired Drew, we had a vision of automating
Speaker 4: that brokerage business because it was one hundred percent human
Speaker 4: right today is ninety six percent touched electronically.
Speaker 7: I wanted to ask you a little bit, Brad, about
Speaker 7: how the business is doing now in the wake of
Speaker 7: the Yellow bankruptcy and what you can tell us you
Speaker 7: have have you seen on your side? Are you picking
Speaker 7: up any of their volumes, any of their workers? How's
Speaker 7: it changed for you?
Speaker 5: Not so many of the workers. And that's a real
Speaker 5: sad part of the Yellow storm.
Speaker 7: That was thirty thousand thousand.
Speaker 5: Workers lost their job.
Speaker 4: That's not a significant number of people. It's a real
Speaker 4: sad human element to that. From a business point of view,
Speaker 4: the whole industry benefited those who were who didn't go bankrupt,
Speaker 4: and you know, they got the volume, so that's tightened
Speaker 4: up the industry. Pricing is up, volume is up, so
Speaker 4: it's been a positive thing. And I mentioned earlier the
Speaker 4: cyber attack on the largest private LTL carrier has also
Speaker 4: increased more volume coming into the market. So it's good
Speaker 4: news bad news for certain people and for others.
Speaker 5: Companies are benefiting from it.
Speaker 2: Just got a couple of minutes left. Jacob's private Equity
Speaker 2: your next to act? How are you thinking about I
Speaker 2: know you were at the forum yesterday and you said
Speaker 2: you it will not be a tech company. You don't
Speaker 2: understand tech valuations. What kind of company will it be?
Speaker 2: What are you going to be looking for in terms
Speaker 2: of investment.
Speaker 4: It certainly would be a tech enabled company, because all
Speaker 4: my companies have used huge amounts of tech, and I
Speaker 4: think that's very, very important because that's the major trend
Speaker 4: of everything that gives you your edge. But something I
Speaker 4: talk about this in the book is what I like
Speaker 4: to find industries that are large, so hundreds of millions,
Speaker 4: billions of dollars in size.
Speaker 5: I don't like to do small industries.
Speaker 4: So you look at the industries I've consolidated, they've been
Speaker 4: large industries, big swaths of GDP. I like to find
Speaker 4: industries where there's enough things to buy at reasonable prices
Speaker 4: so that I can get accretion from buying those.
Speaker 5: And I like to buy.
Speaker 4: I'd like to be an industry where I can buy
Speaker 4: things that there's I can grow them like.
Speaker 2: Well, I'm not going to tell you how how big
Speaker 2: is it, how big is the fundraise? How much do
Speaker 2: you plan be?
Speaker 4: Well, I'm going to put in a billion dollars put
Speaker 4: equity into the next big thing, and then we'll buy
Speaker 4: some companies, and then I'd like to build it up
Speaker 4: to a larger company.
Speaker 5: I mean that I've been running.
Speaker 4: If you look at XPO, rxojis and put them all together,
Speaker 4: it's over twenty five billion dollars in revenue, and I
Speaker 4: don't want to go backwards.
Speaker 2: How to make a few billion dollars? Just real quickly,
Speaker 2: your new book, you're going to have to come back
Speaker 2: and talk more about it when it comes out. I
Speaker 2: would love to, But what's the premise.
Speaker 4: The premise is I looked at I've been doing business
Speaker 4: for forty four years.
Speaker 5: The only job I've had is CEO.
Speaker 4: Right, So I made a lot of decisions, and I
Speaker 4: made a lot of mistakes. So I thought, let me
Speaker 4: think about what are the stupidest mistakes I did, and
Speaker 4: let's write those down, and then let's figure out what
Speaker 4: I learned from each one of those mistakes, because that
Speaker 4: was important to learnings. And then I said, okay, well,
Speaker 4: despite these significant and many blunders, we still delivered tens
Speaker 4: of billions of dollars of shareholder value, which most companies
Speaker 4: don't do. So why did we do that? What were
Speaker 4: the things you did right that are idiosyncratic, that were
Speaker 4: specific to us?
Speaker 5: And that's what the book's about.
Speaker 2: Promise me you'll come back.
Speaker 5: I promise.
Speaker 2: All right, Great, I love it, Brad Jacobs, Thank you
Speaker 2: so much. How to make a few billion dollars? That
Speaker 2: book is going to be out in January.
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Speaker 2: part of Citizen Verizon, which is the company's responsible business
Speaker 2: plan for economic, environmental and social advancement. So let's get
Speaker 2: to it with a voice who knows about the company's
Speaker 2: social responsibility initiatives. Here with us is Rose stucky Kirk,
Speaker 2: chief Corporate Social Responsibility Officer at Verizon, on Zoom from Austin, Texas. Rose,
Speaker 2: nice to have you here with Molly and myself on
Speaker 2: Bloomberg Business Week. What exactly does corporate social responsibility mean
Speaker 2: to Verizon in terms of goal specific initiatives and how
Speaker 2: does it enhance the long term viability of the company.
Speaker 8: Yeah, well, first of all, hello to you both, and
Speaker 8: thank you for having me. You know, Verizons that's set
Speaker 8: out about ten years ago to create a plan for social, economic,
Speaker 8: and environmental advancement, and it was all about how do
Speaker 8: we use Verizon's asset that can acrue revenue to also
Speaker 8: do amazing things in society to create economic prosperity for all,
Speaker 8: and we do that across the dimension of digital inclusion,
Speaker 8: climate protection, and human prosperity.
Speaker 7: So, Grose, I wanted to bring in or to mention
Speaker 7: that one of our colleagues recently wrote a Bloomberg Big
Speaker 7: take on how corporate America has made a lot of
Speaker 7: promises to hire more people of color and they actually
Speaker 7: did it, And this must be an area for focus
Speaker 7: for you and Verizon underrepresented people. So tell us, how
Speaker 7: has the diversity composition at your company change following the
Speaker 7: murder of George Floyd and this renewed focus on race
Speaker 7: in corporate America.
Speaker 8: So for Verizon, it wasn't that we created a renewed
Speaker 8: focus when George Floyd was murdered. We have always been
Speaker 8: focused on diversity and inclusion. Verizon has one of the
Speaker 8: most verse board of directors in the country. In addition
Speaker 8: to that, we have a diverse leadership team. We have
Speaker 8: huge commitments that we have made since the beginning of times.
Speaker 8: When you think about how time rather when you think
Speaker 8: about how we run our business. So I just want
Speaker 8: to be very clear that for us, it wasn't as
Speaker 8: though we had to go and make commitments. We have
Speaker 8: just continued to live the values that have always been
Speaker 8: in place at our company and continue to ensure that
Speaker 8: we have leadership from the top down throughout our one
Speaker 8: hundred and twenty five thousand employees around the globe that
Speaker 8: reflects our society and the customers that we serve.
Speaker 2: How did any of it, though, change to be pharaohs
Speaker 2: because of what happened to George Floyd. You guys have
Speaker 2: had initiatives in place and have been doing it, But
Speaker 2: I do think it made everybody a little bit more heightened,
Speaker 2: if you will, Even for those that were enlightened, like
Speaker 2: you guys at Verizon.
Speaker 8: You know, I think for those who suddenly realized that
Speaker 8: we had a race issue in our country, it certainly
Speaker 8: made them enlightened. For a company like Verizon who has
Speaker 8: recognized that there are disparities that exist, there are systemic
Speaker 8: issues that exist, we recognize that the commitments that we
Speaker 8: made have to continue no matter what the climate, the
Speaker 8: social climate, the political climate. We have to remain committed
Speaker 8: to what I do every day in corporate social responsibility,
Speaker 8: which is to think about how do we lift people
Speaker 8: into economic prosperity, how do we address issues in education,
Speaker 8: issues with small businesses, issues with making sure that people
Speaker 8: have the skills that they need to compete for the
Speaker 8: digital jobs of the future. We just believe that we
Speaker 8: have to stay true to those values no matter what
Speaker 8: the issues are that we are facing in society. And
Speaker 8: the three billion dollar commitment that we have put into
Speaker 8: digital equity over the past several years and the work
Speaker 8: that I oversee and enabling that is a perfect example
Speaker 8: of that commitment.
Speaker 7: So tell us about that investment. How does that money
Speaker 7: get spent and how do you and I'm sure there
Speaker 7: must be some kind of accountability on yourself to make
Speaker 7: sure that it's actually being spent in a way that
Speaker 7: accomplishes those goals.
Speaker 8: Yeah, absolutely so without digital inclusion work, think about it
Speaker 8: across four components. How do we do the right work
Speaker 8: in terms of building out networks and making sure that
Speaker 8: there is accessibility for all. How do we ensure that
Speaker 8: people know how to apply the connectivity that we provide
Speaker 8: for better health care, better education outcomes, better job outcomes.
Speaker 8: How do we do affordability and ensure that we are
Speaker 8: providing solutions that are cost effective for individuals? And then
Speaker 8: how do we do advocacy within our government and our
Speaker 8: state governments to ensure that we have the right policies
Speaker 8: and procedures that are in place.
Speaker 2: So we think about I'm sorry, no, no, no, please finish.
Speaker 8: So when we think about our investment in digital inclusion,
Speaker 8: it's across those four dimensions. So the programs that we
Speaker 8: have in place, like Verizon of Innovative Learning, in which
Speaker 8: we are adopting underserved middle schools across the nation and
Speaker 8: giving them for free connectivity data plans, lesson plans five
Speaker 8: G in their schools, building out five G labs unpackeding
Speaker 8: more than three almost three million students to date with
Speaker 8: the target of ten million by twenty thirty. Those are
Speaker 8: the types of programs that we have in place that
Speaker 8: we measure the outcomes that we're spending money on, that
Speaker 8: we are seeing the long term implication that has on
Speaker 8: students learning and how it's changing their trajectory on the
Speaker 8: types of careers that they want. The program's ten years old,
Speaker 8: and so we can see students who started in middle
Speaker 8: school who are now out of college who have pursued
Speaker 8: careers because of the intervention that we made. So our
Speaker 8: spend and our accountability is around making sure that we're
Speaker 8: building out the next work in areas that we are
Speaker 8: ensuring that people can afford it, that people can learn
Speaker 8: and apply and they can be a part of the
Speaker 8: programs that we have in place that enables them to
Speaker 8: put connectivity into place and in their lives.
Speaker 2: Rolla as you have a front row seat to all
Speaker 2: of this. You guys at Verizon, what do you think
Speaker 2: is the biggest obstacle when it comes to or continues
Speaker 2: to kind of fuel the digital divide. Is it just
Speaker 2: building out the infrastructure component of it, Is it the
Speaker 2: affordability component? What is it?
Speaker 3: You know?
Speaker 8: I think it's making sure that we're not only building
Speaker 8: out the infrastructure and removing any barriers, whether they are
Speaker 8: betteral barriers or state barriers that are in place to
Speaker 8: do that, but that we're also making sure people know
Speaker 8: how to use the technology. The important thing for us
Speaker 8: is that five G is only important if people understand
Speaker 8: how to utilize it to solve some of the big
Speaker 8: problems that we have to use it so that folks
Speaker 8: have access to connectivity for healthcare as I just share it,
Speaker 8: or for education purposes. A part of the divide isn't
Speaker 8: just that you don't have connectivity. You have to also
Speaker 8: address the divide issues in terms of application. It cannot
Speaker 8: exist in a space of if you build it, they
Speaker 8: will calm. It has to be if you build it,
Speaker 8: people know what to do with it, they know how
Speaker 8: to use it, and they know how to ensure that
Speaker 8: equality is in place in the education arena. We cannot
Speaker 8: exist in space when we have a zip code based
Speaker 8: education where children one mile down the road has incredible
Speaker 8: connectivity and experience this with digital technology and children right
Speaker 8: down the street don't. That is the divide that we
Speaker 8: have spent more than ten years addressing and the commitment
Speaker 8: that we are making.
Speaker 2: Got to run. But great to get some time with
Speaker 2: your Roastuckey Kirk, chief Corporate Social Responsibility Officer at Verizon
Speaker 2: On zoom from Austin, Texas. This is Bloomberg.
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Speaker 5: What is wrong with you.
Speaker 4: Why do you feel the need that you've got to
Speaker 4: get somebody all the time. Well, when you get and
Speaker 4: gotten somebody that got you, and you go get them.
Speaker 5: When you get them, everybody's gonna get got up. But
Speaker 5: you're getting the gotters when they didn't do anything to you.
Speaker 1: Get you.
Speaker 5: God has get me. I'm gonna get my.
Speaker 2: Block, all right. That is madea Simmons, you know, the
Speaker 2: individual well, a successful and controversial character and a key
Speaker 2: part of the empire that is now Tyler Perry. This
Speaker 2: story is the cover story, the domestic cover story of
Speaker 2: Bloomberg BusinessWeek magazine. And to put it, as the story
Speaker 2: has done, it's something that Hollywood establishment was very slow
Speaker 2: to warm too. And that is all the world of
Speaker 2: Tyler Perry. So let's get to it. The story, as
Speaker 2: I mentioned, is the domestic cover story for more. Let's
Speaker 2: bring in Bloomberg News Atlanta, bure Chie, Brett Pulley. He's
Speaker 2: joining us on zoom in Atlanta. Brett.
Speaker 3: Hi, Carol, Hi love this.
Speaker 2: Story and it's just fun to kind of go through.
Speaker 2: First of all, tell us how it came together, because
Speaker 2: I'm just curious, how many months, around many years have
Speaker 2: you been looking to maybe tell this story.
Speaker 3: Well, you know, it's it's a great story. It's a
Speaker 3: great question. I have to tell you. I first met
Speaker 3: and spoke with Tyler Perry and did a story about
Speaker 3: eighteen nineteen years ago, the Diary his first film with Lionsgate,
Speaker 3: its very first film, it just come out, Diary of
Speaker 3: a Mad Black Woman. And you know, it's really it's
Speaker 3: really interesting to revisit someone from the time there in
Speaker 3: sort of this this new evolving stage that he was in,
Speaker 3: and then to visit him years later, and he's a
Speaker 3: billionaire and you know hosts Megan Markle and Prince Harry
Speaker 3: at his house. Now that's like they're hide away when
Speaker 3: they leave the you when they left the UK, And
Speaker 3: you know, his best friends with Oprah and all these things,
Speaker 3: and and and and owns a really formidable motion picture
Speaker 3: studio here in Atlanta. So so it's amazing. And it's
Speaker 3: a long answer to your question. Now that this story
Speaker 3: we started pursuing, oh, a good year and a half ago,
Speaker 3: and again it was kind of in it was kind
Speaker 3: of an ongoing thing. I mean, it's a subject I've
Speaker 3: paid attention to. And you know, serendipity doesn't hurt, uh
Speaker 3: Tyler became interested in buying bee t from Paramount uh
Speaker 3: three or four months ago and was outspoken about that,
Speaker 3: uh and that didn't hurt in BT is a property
Speaker 3: that I have a lot long history. What I've written
Speaker 3: a book about be et and so all these things
Speaker 3: kind of play together. And he's a subject who I've
Speaker 3: been paying attention to for quite some time.
Speaker 7: So Brett, you get at this a little bit in
Speaker 7: the story here how Tyler Perry grew up in New
Speaker 7: Orleans and then came to Atlanta and realized that this
Speaker 7: is where he wanted to set up shop and gets
Speaker 7: a little bit starstruck almost every time he goes down
Speaker 7: I seventy five and you know, sees his name on
Speaker 7: billboards directing them to Tyler Perry's studios. Just want to
Speaker 7: get a sense from you. You know, this isn't the
Speaker 7: Hollywood Hills here, but you know you've been in Atlanta
Speaker 7: for quite some time now, you're Atlanta Bureau chief. What
Speaker 7: is it? How much of it do you see driving
Speaker 7: through the city there?
Speaker 3: Well, I mean you see both things. You see Tyler
Speaker 3: Perry's presence as you mentioned, you know, I mean you
Speaker 3: can't you know, go to and from the world's busiest airport,
Speaker 3: which is in Atlanta, without seeing that those signs off
Speaker 3: the highway because it's so relatively close to the airport.
Speaker 3: And so his presence, you know, it is significant in
Speaker 3: so many ways. Uh. And as is the presence of
Speaker 3: the entertainment and the motion picture business here. I mean,
Speaker 3: you know, just over the last ten years or so,
Speaker 3: since very aggressive tax uh tax benefits have been put
Speaker 3: in place by the state, a lot of film and
Speaker 3: television is produced here. You know, all of the practically
Speaker 3: all of the Marvel stuff from Disney uh is done here. Uh.
Speaker 3: And a host of you know, a host of programs,
Speaker 3: television programs and films and uh. And it's it's interesting
Speaker 3: because it has it has uh pompeded a lot of
Speaker 3: people who would otherwise be in Hollywood to be here
Speaker 3: in Atlanta. And that's you know, that's that's you know, talent. UH.
Speaker 3: But also uh, you know, I've been having conversations with
Speaker 3: people who are in film finance, and some of the
Speaker 3: big agencies have put offices here, and so it's uh,
Speaker 3: you know, it's really becoming uh a Hollywood West. And
Speaker 3: Tyler Perry is you know, is a large part of
Speaker 3: that and certainly the largest personification of that.
Speaker 2: Tell us about Tyler Perry though, and you know it's
Speaker 2: interesting as we teased into it. I mean this is,
Speaker 2: you know, Hollywood sometimes misses trends and waves no doubt
Speaker 2: about it. And they definitely the Hollywood establishment, as you
Speaker 2: point out, ignored this individual who wrote, who directed, who produced,
Speaker 2: who acted? Truly the one man show. What is it
Speaker 2: that Hollywood missed and why did they miss it? And
Speaker 2: tell us how Tyler Perry is just turning how we
Speaker 2: make content upside down?
Speaker 3: Yeah, well, I think they missed. What they missed is that,
Speaker 3: you know, there are a lot of places to look
Speaker 3: for business and to look for an audience, right, and
Speaker 3: I think the prism may have been a little too
Speaker 3: narrow in Hollywood. You know, Tyler recounts some great examples
Speaker 3: of that. You know, he went to see uh an
Speaker 3: executive after his He had built an audience with his
Speaker 3: stage plays around the country, right at all these theaters
Speaker 3: and cities around the country. People would you know, church
Speaker 3: groups and stuff loaded up on buses and people went
Speaker 3: to see these plays. And then he created a great
Speaker 3: ancillary revenue along, you know, with with merchandise and other sales,
Speaker 3: and so he had made a fair amount of money
Speaker 3: before Hollywood had discovered it.
Speaker 2: Annual ticket sales and you say, fifty million a million
Speaker 2: revenue ahead.
Speaker 3: So when he finally got a deal in Hollywood with Lionsgate, right,
Speaker 3: he put up half, they put up half, and he
Speaker 3: did what has been key to his financial success. He
Speaker 3: insisted on owning one hundred percent after lions Gate was
Speaker 3: finished with those distribution rights. So after, however, many years,
Speaker 3: one hundred percent ownership all of these films goes to
Speaker 3: Tyler Perry. So you know, as a result, Tyler owns
Speaker 3: all twenty eight of the films he's made, he owns
Speaker 3: over eighteen hundred episodes of television. I mean, you talk
Speaker 3: about a long tail. You know, as distribution platforms change,
Speaker 3: and we know they keep evolving and changing, who knows
Speaker 3: what in the world that'll be worth one day?
Speaker 2: Right, hey, listen, I want to go to what you
Speaker 2: started to say that when he went to visit a
Speaker 2: Paramount Pictures executive looking for a filmed out film deal,
Speaker 2: and they said, well, black people don't go to the movies.
Speaker 2: Well he has shown them that they certainly do.
Speaker 3: Right, that's for sure. I mean you know, all of
Speaker 3: the films, every film that he's made, every film that
Speaker 3: he made for Lionsgate. I'm not sure about the subsequent ones,
Speaker 3: but you know, the lions shared no pun intended. Of
Speaker 3: his work has been distributed by Lionsgate. In terms of
Speaker 3: motion pictures, they all made money, and they're reliable sources
Speaker 3: of revenue, and he delivers them on time, and he
Speaker 3: delivers them under budget. And of course these are things
Speaker 3: in a very predictable, unpredictable business, I should say, such
Speaker 3: as motion pictures that Hollywood likes, and so he has
Speaker 3: been a reliable sort of production machine for the motion
Speaker 3: picture and television business.
Speaker 7: So, Brett, you mentioned that Tyler Perry has been trying
Speaker 7: to extend his commercial reach. He's openly said that he
Speaker 7: wants to buy bet from Paramount. You also mentioned the
Speaker 7: story that Tyler Perry's trying to get into streaming. So
Speaker 7: what's the next big move for him?
Speaker 2: And forgive us, Brett, but only got about twenty five seconds.
Speaker 3: No, that's okay, No, No, He's certainly interested in Bet
Speaker 3: and has been interested, and I guess it's a matter
Speaker 3: of if Paramount puts the property back on the market
Speaker 3: and he has deals with Netflix and with Amazon, and
Speaker 3: is in the streaming world and has some projects coming up,
Speaker 3: uh in that world with some formidable stars such as
Speaker 3: Carrie Washington and Oprah Winfrey and Susan Sarandon. So uh,
Speaker 3: he's still on the hunt for the elusive critical success,
Speaker 3: but certainly uh, sticking very close to to what has
Speaker 3: made him a tremendously successful guy.
Speaker 2: So many great nuggets in this story about how he
Speaker 2: came to be and just kind of where he's going. Brett,
Speaker 2: thank you so much, of course, our Bloomberg News Atlanta,
Speaker 2: be your chief, Brett Pully. His book, by the way,
Speaker 2: on b E T is called The Billion Dollar Bets,
Speaker 2: so check that out as well.
Speaker 5: The journal.
Speaker 8: Now about you, let me drive, No, no, no, honey, please,
Speaker 8: I'll do.
Speaker 2: I want to drive.
Speaker 1: It's a question trying. This is the drive to the
Speaker 1: Globe dot com Tim, we'll buy around together down on
Speaker 1: Bloomberg Radio.
Speaker 2: All right, everybody. The S and P five hundred officially
Speaker 2: at one point hit over sold territory based on relative
Speaker 2: strength index. It went below thirty, although it did go
Speaker 2: just above it again or back above it. I should
Speaker 2: say today this is the world we live in. I
Speaker 2: feel like depending on the data flow, depending on the
Speaker 2: tone the fedspeak, the markets move on it pretty quickly.
Speaker 7: You know, it's I think we're still in that good
Speaker 7: news is bad news, bad news is good news. Hopefully
Speaker 7: our next guest, another Carol, will shed some light on
Speaker 7: it for us.
Speaker 2: Well, our next guest does say the markets are over sold.
Speaker 2: Let's get to it. Our Drive to the Closed guest
Speaker 2: on this Wednesday, Carol Schlife. She's CIO at PIMO Family Office.
Speaker 2: Back with us on zoom in Minneapolis. Carol, good to
Speaker 2: have you back. How are you.
Speaker 7: To be back?
Speaker 2: Well, it's good to have you here. You do say
Speaker 2: the markets are over sold. You're talking about the equity
Speaker 2: markets specifically, or bottom markets as well.
Speaker 9: The fixed income markets are pretty over sold to that
Speaker 9: shoot up towards five percent on the ten year yesterday
Speaker 9: was you know, I get up out of the way
Speaker 9: and let the knives fall where they may sort of move.
Speaker 9: So you can make an argument that both markets, emotion
Speaker 9: has been taking and pushing things to the edges.
Speaker 7: So when the one hand you're saying things are over sold,
Speaker 7: into my ear, that sounds like maybe by the dip,
Speaker 7: But then you're saying knives are falling, so maybe not
Speaker 7: so much.
Speaker 9: Yeah, I think we've had a balanced approach to risk
Speaker 9: for a very long period of time, and we think
Speaker 9: we don't necessarily want to be entirely out of the
Speaker 9: growth camp. You want to have a leg there because
Speaker 9: there's some really interesting fiscal stimulus that's putting a floor
Speaker 9: underneath a lot of things in the economy.
Speaker 2: We just talked about that. We just talked about that
Speaker 2: with Brad Jacobs, who's the executive chair of an XPO,
Speaker 2: that we can't kind of ignore all that stimulus from
Speaker 2: policy decisions right that are that's coming into the economy now.
Speaker 9: And even when you look at the ADP jobs numbers,
Speaker 9: the large companies were letting people go, but the mid
Speaker 9: and small sized companies are doing really well. And I've
Speaker 9: been spending a lot of time recently talking to our
Speaker 9: commercial bankers, and these are these guys, are guys and
Speaker 9: gals are banking the mid size companies. And the primary
Speaker 9: issue that those companies are having is that activity is
Speaker 9: so strong they can't get employees. And you saw in
Speaker 9: the ADP report that mid and small sized companies are
Speaker 9: still hiring, and so there's a lot of underlying strength
Speaker 9: that wants to be there. It's a little hairy in
Speaker 9: terms of they have to have really good clean balance
Speaker 9: sheets and solid cash blows and patients in accessing the
Speaker 9: debt markets until we figure out where the detocredit markets,
Speaker 9: until we figure out where that's going to level off.
Speaker 9: But on the other hand, you know, there was especially
Speaker 9: at the beginning of the year, you had tech run
Speaker 9: away with portfolios. You had a very neurow market up
Speaker 9: until May, and so there's a lot of nuance to
Speaker 9: the market here. And it doesn't help that we've got
Speaker 9: all of what's going on in Washington on top of it.
Speaker 2: So nuance meaning what get ready everybody for some more
Speaker 2: volatility is that.
Speaker 9: I think volatility definitely through end of the year because
Speaker 9: one of the interesting things is we had been calling
Speaker 9: for soft landing last year all the way through the year,
Speaker 9: and then when the whole rest of the world seemed
Speaker 9: to come over to our soft landing camp, that's actually
Speaker 9: when a lot of the potential headwinds stepped up in
Speaker 9: terms of consumers. There's a lot of things to watch
Speaker 9: between here and your end. We'll get some good data
Speaker 9: as equity investors, in particular with earning starting next week,
Speaker 9: So a couple of weeks of good data, toy'll be
Speaker 9: able to purse through from the individual companies and then
Speaker 9: we'll get into it. Thankfully, we have at least forty
Speaker 9: five more days of some more government.
Speaker 7: I felt like you're counting, yeah, and starting with the
Speaker 7: jobs of it of course this Friday, and so you
Speaker 7: were just saying, this is really interesting here that when
Speaker 7: all of these people started joining the soft landing camp,
Speaker 7: that's when, ironically the tide started to shift maybe a
Speaker 7: little bit in the other direction, started to get some
Speaker 7: of those recession calls creeping back in.
Speaker 3: There.
Speaker 7: You still feeling confident in the soft landing call.
Speaker 9: I think we're saying there's a potential fragility in the market.
Speaker 9: Things were pretty evenly balanced going in. But we'll be
Speaker 9: watching really carefully what the consumer does going into the
Speaker 9: tail end of the year because we're coming into one
Speaker 9: of the most important holiday selling seasons. Even though there
Speaker 9: was a lot of activity this summer between Taylor, Swift
Speaker 9: and Barbie and all of the other still carryover on
Speaker 9: revenge spending and weddings as far as the eye can see.
Speaker 9: So it'll be important to watch that. A lot of
Speaker 9: volatility but we do think a lot of that stuff
Speaker 9: gets sorted out. People start angering to a new higher
Speaker 9: neutral rate, if you will, in terms of a more
Speaker 9: normalized neutral rate of two to three percent, if you will,
Speaker 9: on top of whatever inflation ends up being, and inflation
Speaker 9: is moderating pretty nicely. So things are happening the way
Speaker 9: the FED wants them to. If the Fed can avoid
Speaker 9: raising again, and we do think there's risk of a
Speaker 9: policy or if the Fed tries to raise again, because
Speaker 9: you've actually, if you look at where the tenure's gone
Speaker 9: in the last couple of weeks, it's like it one
Speaker 9: or two Fed raises right there.
Speaker 2: Hey, one thing I want to ask you, and I'm
Speaker 2: looking at the headline on our market wrap. At this hour,
Speaker 2: we've just got about thirteen minutes to go. Stocks are
Speaker 2: at their best levels of the session, and it's led
Speaker 2: once again by the Nasdaq, which is up about carol
Speaker 2: one and a half percent. Here, I've got Google up
Speaker 2: two point four percent, Amazon's up two percent, Microsoft's up
Speaker 2: two percent, big tech once again leading the way. Investors
Speaker 2: when there's a pullback, they come back and buy in,
Speaker 2: and then you know, there's always the argument that two
Speaker 2: concentrated you know these names, they've already had their run.
Speaker 2: How do you see some of the big take and
Speaker 2: what's the play and what's the call here?
Speaker 9: I think the interesting thing is is you've got secular
Speaker 9: moves going on in terms of the way people are
Speaker 9: deploying artificial intelligence, and similar to other big technologies, when
Speaker 9: you had biotechnology first hit the scene, and it was
Speaker 9: really just a dream in the eighties and early nineties
Speaker 9: the first couple of times those industry ran, but they've
Speaker 9: proved to be a real legitimate, sort of game changing industry.
Speaker 9: And artificial intelligence lots of people have been trying to
Speaker 9: figure out how to deploy, writing business cases for it
Speaker 9: for over a decade actually, and we're just getting at
Speaker 9: the point where it's gaining public more public notice. And
Speaker 9: so between that and a lot of the stimulus that's
Speaker 9: been tied up by the government, plans to green the grid,
Speaker 9: improve our infrastructure, bring manufacturing home or close to home,
Speaker 9: all of that stuff entails a lot of technology, whether
Speaker 9: it's artificial intelligence, cybersecurity.
Speaker 7: Just last, thank you if you here, Carol, before we
Speaker 7: let you go, what would you say is your biggest
Speaker 7: conviction call heading into the your end.
Speaker 2: Just got about thirty seconds.
Speaker 9: I think the biggest conviction call is probably to stay balanced,
Speaker 9: to keep a tow in some of the large cap
Speaker 9: equity stocks, but also not be afraid to sit on
Speaker 9: a little bit of cash and shorter term treasure is
Speaker 9: to take advantage of those. So it's to keep a
Speaker 9: balanced approach. So no matter what the outcome, your portfolio
Speaker 9: is durable.
Speaker 2: All right, Gonna leave it on that note. Hey, Carol,
Speaker 2: good to catch up with you. Caroshlife. She's chief investment
Speaker 2: officer of at Beema Family Office. Excuse me joining us
Speaker 2: on zoom in Minneapolis.
Speaker 1: This is the Bloomberg Business Week podcast, available on Apple, Spotify,
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