Speaker 1: Welcome to the Bloomberg Penl podcast on Paul Swing You.
Speaker 1: Along with my co host Lisa Brahma Waits, each day
Speaker 1: we bring you the most noteworthy and useful interviews for
Speaker 1: you and your money, whether at the grocery store or
Speaker 1: the trading floor. Find a Bloomberg Penl podcast on Apple
Speaker 1: podcast or wherever you listen to podcasts, as well as
Speaker 1: at Bloomberg dot com. Ford announced that it will eliminate
Speaker 1: about twenty percent of its workforce across Europe, closing six factories,
Speaker 1: with some in Germany. The shares of the company up
Speaker 1: two point two percent. UH, sort of showing how markets
Speaker 1: are viewing this cut jobs as you try to streamline
Speaker 1: your business, and they've been dealing with a host of
Speaker 1: issues in Europe in particular. Joining us now to get
Speaker 1: a sense of the implications of this announcement. David Kudla,
Speaker 1: chief executive officer and chief investment strategist at Mainstay Capital
Speaker 1: Management with two and a half billion dollars under management, UH,
Speaker 1: sailing from Michigan, where for is based. Thank you so
Speaker 1: much for being with us. David. We love having you on.
Speaker 1: So let's just start with what was your initial knee
Speaker 1: jerk reaction to Ford's announcement this morning about the job cuts.
Speaker 1: Good morning, Lisa, Well we expected this, we knew this
Speaker 1: was coming. We've seen forward U continued to streamline, streamline
Speaker 1: operations in Europe. The market there is weak overall, and
Speaker 1: uh Ford, like GM, has UH the problem of working
Speaker 1: in that middle market, selling in that middle market with
Speaker 1: a lot of their products. There's a weak market overall.
Speaker 1: UH they have strength in commercial vehicles, but they're not
Speaker 1: in the luxury car market where the money is made
Speaker 1: in Europe, and that's the problem they suffer from. And
Speaker 1: so where General Motors decided finally to just exit by
Speaker 1: selling their Opal unit, uh Ford is trying to stay there,
Speaker 1: and the only way they can stay there is to
Speaker 1: continue to restructure, restructure, structure, and we're seeing another big,
Speaker 1: big step in that direction. It's interesting, Dave, that you
Speaker 1: mentioned GM and OPAL and I look at the stock
Speaker 1: today and I'm sure you know stock called does clearly
Speaker 1: like this move here. Do you think Ford is considering
Speaker 1: doing a GM and just kind of getting out of
Speaker 1: the European market just seems so brutal to make a
Speaker 1: profit there. It is brutal to make a profit there.
Speaker 1: If you look, you know the the economic situation, the
Speaker 1: political environment, regulatory environment in Europe, the the the current
Speaker 1: economic environment in Europe, and you know the trouble that
Speaker 1: American automakers have had competing there. It's a very different
Speaker 1: market from the US. And the strength of American automakers
Speaker 1: is um in in trucks UH and subs large trucks
Speaker 1: which don't which don't sell there. They're not they're not made,
Speaker 1: they're not popular in Europe, and so UH. You know,
Speaker 1: the money that's made in Europe is in luxury cars
Speaker 1: and in commercial vehicles. Now Ford has strength and commercial vehicles.
Speaker 1: They have a partnership with BW that they're they're doing
Speaker 1: quite well with, but not really in the luxury vehicle
Speaker 1: segment that belongs to the luxury brands there in Europe,
Speaker 1: and and some some others that are imported UH. In
Speaker 1: that middle market that that's where you can struggle. But
Speaker 1: they do in the suv market, the Kuga that's sold
Speaker 1: over hundred fifty thou units last year at the Ecosport
Speaker 1: over a hundred thousand units last year. They have some
Speaker 1: strength there. So the way they're streamlining now with the
Speaker 1: three divisions are going from there talking about maybe bringing
Speaker 1: in some you know, an iconic brand with the Mustang.
Speaker 1: There might be some opportunity there, small opportunity in niche market,
Speaker 1: but the uh, this streamlining I think has some potential,
Speaker 1: but it's it's just a difficult market, I think for
Speaker 1: an American automaker, how do we sort of view the
Speaker 1: difficulties in the European auto market and lou in light
Speaker 1: of some of the trade tensions and the global slow
Speaker 1: down in growth up more generally, I mean, is this
Speaker 1: a part of that story or is this idiosyncratic having
Speaker 1: to do with the models that are popular and regulations
Speaker 1: and just the sort of entrenchment of local companies there.
Speaker 1: Well that you know, that's the other part of it. Uh.
Speaker 1: You know, one of the the announcements with this is
Speaker 1: that they that that four expects to more than triple
Speaker 1: their passenger vehicle imports into Europe annually by And if
Speaker 1: you're going to triple your passenger vehicle imports into Europe annually,
Speaker 1: you need a favorable trade environment to do that, and
Speaker 1: the current administration is made at quite difficult. So, uh,
Speaker 1: you know, you have entrenched brands there that are are
Speaker 1: there is a lot of brand loyalty on that continent. UH,
Speaker 1: and I think that's where there's been difficulty with you know,
Speaker 1: some of the brands that import there. But now you
Speaker 1: have these artificial barriers or let's call them real barriers,
Speaker 1: barriers with uh, the the trade wars that are coming
Speaker 1: up in the tariffs that that keep popping their head up,
Speaker 1: or threats of terrorists that keep popping their head up. So, David,
Speaker 1: I know in the States there's a growing discussion about
Speaker 1: whether we have reached a peak auto in the US
Speaker 1: art there's similar discussions in Europe like that. There's similar
Speaker 1: discussions like that. But the concern in in in Europe
Speaker 1: is is that is that auto sales have just been
Speaker 1: stagnant really for for quite some time because of the
Speaker 1: economic conditions. And for you know, GM before this and
Speaker 1: Ford for years have just been operating at a loss.
Speaker 1: They've had very few years over many years where they've
Speaker 1: had a profit. Ford had a four million dollar loss
Speaker 1: last year. And in Europe and we'll probably again this year,
Speaker 1: UH with this restructuring. UH. As we get you know,
Speaker 1: down the road, that may help, but it is just
Speaker 1: a market where there have been more years in recent
Speaker 1: year years many more years have lost than profit, and
Speaker 1: you know, how many do you sustain that? And I
Speaker 1: think that's why GM finally decided to cut the cord
Speaker 1: with their Oval unit. David Couldla, thank you so much.
Speaker 1: David is the chief executive officer and chief investment strategist
Speaker 1: at main Stake Capital Management based in Michigan, and we
Speaker 1: love to have him on talking about the auto industry.
Speaker 1: He's really plugged in there and it's just a big,
Speaker 1: big issue for the US automakers. In Europe, we have
Speaker 1: the Democratic debates underway. Tonight is the second night of
Speaker 1: a to night extravaganza with twenty candidates at meeting, joining
Speaker 1: us down to talk about what we heard last night.
Speaker 1: Chris Leu, former Deputy Secretary of Labor under President Obama
Speaker 1: and senior fellow at the University of Virginia's Miller Center. Chris,
Speaker 1: thank you so much for being with us. First of all,
Speaker 1: i'd love to get your impression of last night's debate.
Speaker 1: What was your thought? Well, you know, it's pretty much
Speaker 1: what I expected. And it is one of the challenges
Speaker 1: with the format of having ten people on stage trying
Speaker 1: to share two hours. You know, if you look at
Speaker 1: the recent path of debates, they really don't have a
Speaker 1: big effect. We'll talk about them for about twenty four hours,
Speaker 1: but short of somebody making a major gaff and I
Speaker 1: didn't see that last night. Um you know, it's some
Speaker 1: candidates will move up, some will move down a little bit,
Speaker 1: but I think it's sort of status quo. Obviously. I
Speaker 1: think Julian Castor did have a very nice night last night,
Speaker 1: and I think it will cause people to look at
Speaker 1: him a little differently. I was also frankly surprised by
Speaker 1: mare de Blasio, who came out very strong, and you know,
Speaker 1: he hasn't really had much traction in his race as well.
Speaker 1: I also thought, um uh, Centator Warned did well as also.
Speaker 1: The challenge, however, is that you know, in this twenty
Speaker 1: four hour period, from less than twenty four before the
Speaker 1: end of one debate to the start of another debate,
Speaker 1: there's not much time and then by tomorrow we'll be
Speaker 1: talking about date debate number two. So, Chris, were you
Speaker 1: surprised at all that the candidates generally last night did
Speaker 1: not go after Senator Elizabeth Warren, who, at least on
Speaker 1: that stage, was the front runner. You know, I am
Speaker 1: a little surprised by that, and you saw and there
Speaker 1: was a place I think certainly to do that. Um,
Speaker 1: that moment when the moderators asked them to to raise
Speaker 1: their hands whether they would eliminate private insurance of health insurance,
Speaker 1: you saw, Um, you saw Congressman Delaney a little bit
Speaker 1: kind of go after that. But I think by and large,
Speaker 1: you know, the unfortunate thing about the format, um, you know,
Speaker 1: at at about halfway through the people start cutting in
Speaker 1: on each other. But by and large, for that first
Speaker 1: period of time when she was doing most of the speaking,
Speaker 1: the contenders are really just kind of waiting to be
Speaker 1: asked questions, So it didn't really lend itself to kind
Speaker 1: of a lot of back and forth. So you're a
Speaker 1: d n C Democratic National Committee super delegate, so you're
Speaker 1: intimately connected with the Democratic Party. And there is sort
Speaker 1: of a very big question here embedded in these debates,
Speaker 1: and that is can any of these candidates beat President Trump?
Speaker 1: And from what you heard last night, did you feel
Speaker 1: more confident or less confident of that? I'm not sure
Speaker 1: I felt more or less confident, As I said, you know,
Speaker 1: I think look, um, I was with President or Senator
Speaker 1: about my back at two thousand and seven, we went
Speaker 1: through an endless series of debates and uh, you know,
Speaker 1: if you go back and read the press accounts of
Speaker 1: that first debate, Senator Obama was pretty underwhelming at the time.
Speaker 1: And so look, it's early in the process. Um, candidates,
Speaker 1: you get better, and I frankly what I think is
Speaker 1: going to be more interesting for many of these candidates.
Speaker 1: They're gonna have to post their second courter of fundraising
Speaker 1: numbers at the end of June. It'll be interesting to
Speaker 1: see because that you know, it is not cheap to
Speaker 1: run some of these campaigns, and uh, some of them
Speaker 1: have had a challenge raising money in this crowded field.
Speaker 1: So you know, look, I think last night we heard
Speaker 1: a lot of substantive debates. It was largely free of insults. Uh,
Speaker 1: it was completely free of insults. And that's kind of
Speaker 1: a mark change from I think what we saw in
Speaker 1: the Republican bates with than candidate Trump. So, Chris, I
Speaker 1: also noticed last night that the candidates didn't really attack
Speaker 1: Trump's character or maybe some of those questionable policies and
Speaker 1: actions and tweets. Do you think the sticking to the
Speaker 1: policies strategy will work against Trump? You know, look, I
Speaker 1: think I think I think they need to do both. Um.
Speaker 1: I think it's highlighting um what UM Trump's policies, his
Speaker 1: his demeanor in office. But I think it's also UM
Speaker 1: putting forward an affirmative, positive agenda of what they're going
Speaker 1: to do on things like healthcare, education, or immigration. Largely
Speaker 1: the kind of anti Trump message I don't think really
Speaker 1: needs to be made. It's being made here in Washington
Speaker 1: every day, is being made on the cable news networks. UM.
Speaker 1: You know, I just got back from I was in
Speaker 1: Iowa yesterday meeting with some voters, and they really want
Speaker 1: to hear about the issues that are affecting in their lives,
Speaker 1: and so, UM, I don't know that they necessarily the
Speaker 1: candidates nests that I need to draw that distinction, because
Speaker 1: it really is being made for them. You know, you
Speaker 1: started out talking about the limitations of this debate format.
Speaker 1: Is there a way that it could have been done
Speaker 1: that would have been more effective? Uh, it's sort of
Speaker 1: lesson learned for next time, not to have two nights
Speaker 1: of ten different candidates on the stage, each having about
Speaker 1: thirty seconds to talk. Yeah, you know, it's unfortunate because
Speaker 1: the Democratic National Committee I think was trying to address
Speaker 1: the concerns that came out of sixteen that they may have,
Speaker 1: you know, put their thumb on the scale, and so
Speaker 1: what they wanted to do very early on is create
Speaker 1: these objective criterias that everyone knew what they were, and
Speaker 1: to try to meet them. In hindsight, they probably set
Speaker 1: the criteria a little bit too low, this idea that
Speaker 1: sixty five thousand donations could get you in UH. In
Speaker 1: this day and age, it's relatively easy to do that,
Speaker 1: and you can game it in a bunch of different ways.
Speaker 1: I think the real interesting challenge will be when they
Speaker 1: get this September, because then the donation threshold goes to
Speaker 1: a hundred and thirty thousand UH. It's also a two
Speaker 1: percent polling threshold, so I think you may likely see
Speaker 1: only you know, a dozen candidates on the debate stage
Speaker 1: up come September. So, Chris, tonight, we have the second
Speaker 1: night of debates, and of course um uh from a
Speaker 1: vice president Joe Biden and Bernie Sanders as well the
Speaker 1: front runners. What do you expect tonight? Well, I think
Speaker 1: tonight is gonna be a fascinating contrast. I'm gonna be
Speaker 1: looking at whether um uh, Senator Sanders and Vice President
Speaker 1: Biden go after each other. I suspect they won't, but
Speaker 1: I think what you will see is this kind of
Speaker 1: interesting um gender and generational contrast with Kamala Harrison stage
Speaker 1: along with Pete Boutigge, who, even if they're not directly
Speaker 1: going after either Sanders or Biden, provide sort of an
Speaker 1: interesting contrast for voters who want either a more diverse
Speaker 1: candidate or a younger candidate. And who do you think
Speaker 1: is winning right now for the quote soul of the
Speaker 1: Democratic Party, the more liberal wing, the sort of further
Speaker 1: left or this interest Well, it's it's interesting that there's
Speaker 1: the contradiction between what we all see on social media
Speaker 1: and Twitter, which is clearly a much more progressive audience
Speaker 1: then and what you certainly see when you're out talking
Speaker 1: to vote and what you see in public opinion polls. UM.
Speaker 1: But I do think which is I think more moderate?
Speaker 1: I do think it's a challenge. I think ultimately when
Speaker 1: you look at these candidates, there are some extremes, but
Speaker 1: by and large they're united in the idea that we
Speaker 1: need to do more to make the economy work for everyone.
Speaker 1: We need to do more to expand healthcare and make
Speaker 1: it um less expensive. We need to do more in
Speaker 1: terms of building up our relationships with allies. I think
Speaker 1: it's gradations on the spectrum at this point. Chris lou
Speaker 1: thank you so much for taking the time today. Uh
Speaker 1: was she the best of luck. Chris lewis Senior Fellow
Speaker 1: at the University of Virginia Miller Center, former Deputy Secretary
Speaker 1: of Labor under President Obama. Also he is a d
Speaker 1: n C super Delegate. Has just been in Iowa talking
Speaker 1: to perspective voters. As Paul Sweeney was talking just minutes ago.
Speaker 1: You might have heard some beeping in the background, and
Speaker 1: that's because I was up against the wall holding a
Speaker 1: smartphone in various places to try to get a size
Speaker 1: of what clothes I should be buying. And that is
Speaker 1: because Ronan Luzon is here with us. He is founder
Speaker 1: and chief executive officer of My Size, based in Israel,
Speaker 1: but joining us here in our Bloomberg Intta Active Broker Studios.
Speaker 1: Ronan my Size, from what I could tell, is an
Speaker 1: app on your phone that allows you to buy sensors
Speaker 1: by just holding the phone in various places while I'm
Speaker 1: wearing some clothes I'm still wearing clothes to uh just
Speaker 1: tell you exactly what size you'd be in different brands
Speaker 1: to facilitate online shopping. Is that correct? Yeah? That's right? Right? Yeah,
Speaker 1: So how much has this been adopted so far? So? Um,
Speaker 1: the company started two thousand fourteen, and we started as
Speaker 1: a publicly traded company, but we just launched the product
Speaker 1: last September in Fashion Week in New York. So we
Speaker 1: took us about four years to make this thing happen.
Speaker 1: He started as a dream as as a pro when
Speaker 1: that each and everyone of us suffer when we're buying
Speaker 1: things online. We get always the wrong size, well not always,
Speaker 1: but we get sometimes the wrong size. And it took
Speaker 1: four years and we just launched it in last September
Speaker 1: in Fashion Week and was great. Like, retailers are looking
Speaker 1: for a solution because they're suffering for much from the
Speaker 1: online returns in the US alone, as between thirty and
Speaker 1: fifty percent returns almost every second item is being sent back.
Speaker 1: It's an abslute situation for the retailers and for us
Speaker 1: to consumers. So we just now start kicking off. We
Speaker 1: began romping up the the adoption of the technology both
Speaker 1: on retailers and consumers alike, even though our business model
Speaker 1: is B two B. So who's paying for that technology
Speaker 1: is the retailers the consumers completely free for use and
Speaker 1: uh and and try so that everybody can download it.
Speaker 1: But who's paying for that is the retailers. So they're
Speaker 1: paying for every what we call a fit recommendation. Us
Speaker 1: as the users as consumers when we're going online for
Speaker 1: our favorite retailer or a new retailer that we don't
Speaker 1: know ourselves, eyes before we click on the button to
Speaker 1: get our recommended size, and then when we as a
Speaker 1: my size charge to retailer for alright, So talking about
Speaker 1: the technology here again, I was working over here and
Speaker 1: you guys are over there in the corner of the studio.
Speaker 1: He raises his eyebrows. I wasn't working and I heard
Speaker 1: a lot of buzzing and peeping and phones being way
Speaker 1: waved around. How does the technology work? So when I
Speaker 1: started that it's it was because of my my kid,
Speaker 1: now today's fifteen, but he back then was ordering things online,
Speaker 1: especially NBA suits, and it came wrong size, and I
Speaker 1: was thinking something must change here. So there was some
Speaker 1: different technologies out there, and one of them was image processing.
Speaker 1: So you need to take a picture of yourself and
Speaker 1: then by the image it does the calculation off off
Speaker 1: of the sizing. The thing is that you need to
Speaker 1: take your clothes off. Now I would never get my
Speaker 1: kid taking a picture with naked or half naked and
Speaker 1: send it to doesn't matter how secure the server is,
Speaker 1: it will never happen, especially for women, even even for
Speaker 1: us as men, we will never do that. So I
Speaker 1: was thinking what other possibilities can be to do that.
Speaker 1: So we took the mobile phone sensors, the same sensors
Speaker 1: that are almost every mobile phone for kids when they're
Speaker 1: playing with the phone, they moved from one place to another,
Speaker 1: it's the same sensors. It's accelerometer and the gyro that
Speaker 1: result in the mobile phone and algorithm that we've developed.
Speaker 1: So we know to take the information from the sensors
Speaker 1: when you move the phone over your body from one
Speaker 1: place to another, we know to measure the distance the
Speaker 1: phone is moving between two points. And that's how we
Speaker 1: actually make this technology work for the apparel. So what
Speaker 1: types of companies are you working with to sort of
Speaker 1: get more online traction and and understand how to sort
Speaker 1: of limit some of these returns. So it's amazing that
Speaker 1: we've started actually demonstrating technology back in cs in two
Speaker 1: thousand seventeen, and back then the technology didn't actually work.
Speaker 1: It was more like a proof of concept. Even that
Speaker 1: was not the best scenario. But the CSWO thousand eighteen
Speaker 1: we actually launched the the beta one, and when we
Speaker 1: watched the beta, we understood that so many retailers followed
Speaker 1: us because they have this issue of sizing and faith
Speaker 1: and they need to accommodate the problem. And starting two
Speaker 1: thousand eighteen, when we start demonstrating the actual body measurement
Speaker 1: technology that we're doing today, UM retailers start to sign
Speaker 1: up for air lies and pilots and try it out.
Speaker 1: And today we have to to one customers that sign
Speaker 1: up with our solution. It stakes it takes time for
Speaker 1: the till one customers to start the integration. It takes
Speaker 1: it takes longer than we actually anticipated because what we
Speaker 1: see is that the retailer is not that much of
Speaker 1: a computer oriented of an I T company that can
Speaker 1: have a technology like that and start working with it
Speaker 1: as like as as we can see for the small
Speaker 1: and medium size retailer that's doing it in in a
Speaker 1: couple of days or we they actually integrated. So it's
Speaker 1: it's takes it takes the time to integrate it, but
Speaker 1: we as well done the integration on Shopify platforms platform
Speaker 1: and light Speed platform. It's the same like Shopify, but Europe,
Speaker 1: on Europe, Netherlands, and we can see these these small
Speaker 1: ones are taking this technology and integrated within a couple
Speaker 1: of hours and they stopped working with it, and it's amazing.
Speaker 1: It's amazing product. You see how they can save returns,
Speaker 1: which kills their business if they don't. Right, absolutely running,
Speaker 1: Thanks so much for coming on and measuring my co
Speaker 1: host here. Thank you for not measuring. As I said,
Speaker 1: I'm a forty two regular right off the rack down.
Speaker 1: Don't have to worry about me running. Lucan founder and
Speaker 1: CEO of my size. Just a really cool technology. Keep
Speaker 1: us in the loop as this thing continues to develop.
Speaker 1: It really like to kind of see how this places
Speaker 1: are very interesting technology as more and more clothing goes online.
Speaker 1: We've talked a lot about Libra, which is the cryptocurrency,
Speaker 1: or at least it's been called a cryptocurrency. It's an
Speaker 1: idea that Facebook is putting out there, and I really
Speaker 1: am excited to bring in Aaron Brown. I always love
Speaker 1: speaking with him. He's the former managing director and head
Speaker 1: of financial market research at a q R Capital Management.
Speaker 1: But I'm especially excited today because he wrote a column
Speaker 1: as a Bloomberg opinion columnist that I found incredibly compelling. Aaron,
Speaker 1: thank you so much for being with us. Uh. It
Speaker 1: was talking about how, in general, the bitcoin and cryptocurrency
Speaker 1: community is moving outside of the financial system that is
Speaker 1: sort of entrenched, and that Facebook was doing the exact
Speaker 1: opposite and from the top down trying to come up
Speaker 1: with some kind of monetary unit that could rival the dollar,
Speaker 1: the euro, the yend. Can you explain how that's the case. Yeah,
Speaker 1: thanks for having me. The best term for what libra
Speaker 1: is something called digital cash. Now cash is something that
Speaker 1: it can be a dollar bill, it could be a
Speaker 1: gold coin. It can be anything that you can pass
Speaker 1: from one person to another without leaving a transaction record,
Speaker 1: and that the individual can identify, I can can validate.
Speaker 1: It's hard to counterfeit um. Bitcoin and other cryptocurrencies are
Speaker 1: much broader ideas, you know, trying to re engineer both
Speaker 1: technology of exchange and financial system or whatever. Uh. Libre
Speaker 1: is an old idea. It's a you know, it's it's
Speaker 1: a gold coin, it's a dollar bill. It just happens
Speaker 1: to be digital, meaning that it's a number. It's not
Speaker 1: a physical piece of paper. It's not a piece of metal. Um.
Speaker 1: So in one sense, it's very conservative idea. It's just saying, Okay,
Speaker 1: let's take cash and let's let's make it digital, something
Speaker 1: that bitcoin does. But bitcoin does tons of other stuff too.
Speaker 1: I think Libra is a competitor to other forms of cash.
Speaker 1: When I say it's a competitor to the US dollar,
Speaker 1: I don't mean the US dollar financial system, you know,
Speaker 1: with a central bank and the fat banking. I mean
Speaker 1: those physical pieces of paper that people use, whether you know,
Speaker 1: buying a cup of coffee or putting a whole bunch
Speaker 1: in a suitcase to buy a boatload of drugs. Whatever. Uh,
Speaker 1: that's what Libra is going to That's the market Libra
Speaker 1: is going to attack. So it's interesting erin we've had,
Speaker 1: you know, thinking about the bitcoin, the volatility has really
Speaker 1: come back into that security. I sit down about eight
Speaker 1: point seven percent today. It just had this incredible run
Speaker 1: over the last couple of weeks, a couple of days,
Speaker 1: crazy trading who was actually trading this thing. Well, you know,
Speaker 1: I wrote a call about ten days ago saying the
Speaker 1: two thousand nineteen rally and bitcoin was completely different from
Speaker 1: the earlier one. It was not marked by access of volatility.
Speaker 1: It was real money. It was based on fundamentals, and
Speaker 1: you could really you know, trace it. Uh for the
Speaker 1: last ten days made me a liar, And we're seeing
Speaker 1: not a liar just you were postulating. It turns out
Speaker 1: perhaps it's a little more volatile than that. Yeah, well
Speaker 1: we'll change. I mean, we're now seeing the last well,
Speaker 1: certainly last week, we were just seeing a lot of
Speaker 1: kinds of stuff we saw on you know, late two
Speaker 1: thousand seventeen and in previous crypto rallies. Are seeing a
Speaker 1: lot of retail investors. We're seeing real money selling, we're
Speaker 1: seeing high volatility. We're seeing how you know, once it
Speaker 1: starts going up, there's you know, just massive people piling in,
Speaker 1: and if it starts to go down a little bit,
Speaker 1: that people pile out. Um. I hope this isn't just
Speaker 1: like a flash in the pan. I mean, I hope
Speaker 1: this is just like a minor thing. It does seem
Speaker 1: to be connected around the libre announcement, which has no
Speaker 1: you know, I mean, it's not that tig an announcement period,
Speaker 1: and it certainly doesn't have a huge effect on the
Speaker 1: long term value of crypto, but it got a lot
Speaker 1: of people excited, and I think it got a lot
Speaker 1: of uh people piling in. So I think what we're
Speaker 1: seeing uh in late June is you know, kind of
Speaker 1: a mini boom and bust uh. And I hope that
Speaker 1: the rest of two thousand nineteen is going to go
Speaker 1: along on a nice, steady fundamental move up or down,
Speaker 1: but not you know, based on real investors, real money
Speaker 1: and looking at the fundamentals as opposed to people afraid
Speaker 1: of missing out. Well, Aaron, I want to pick up
Speaker 1: on the idea that some people connected this to Libra
Speaker 1: and some people who were just speculating. But Danny Masters
Speaker 1: was on our show earlier this week of coin shares,
Speaker 1: and he was saying that there is direct connection in
Speaker 1: terms of this creates a platform for people to potentially
Speaker 1: use bitcoin right right next to dollars as transfer cash,
Speaker 1: So it creates the piping for bitcoin to enter more
Speaker 1: commonplace methods of payment. Do you ascribe to that kind
Speaker 1: of idea, Yeah, that's absolutely true. Among other things, libra
Speaker 1: is a very crypto friendly form of cash, and all
Speaker 1: the problems we've had with you know, bitcoin and financial
Speaker 1: mark and and cryptocurrencies and so on has been when
Speaker 1: people try to connect them to dollars. That's where you
Speaker 1: get the fraud. That's where you get the volatility, that's
Speaker 1: where you get the regulators upset. You know, as long
Speaker 1: as people are just using cryptocurrency in itself, it's a
Speaker 1: very uh to day calm. You know. It's a rapidly
Speaker 1: changing technology, but it's one that has been clearly beneficial
Speaker 1: and useful. So if Libra is successful, now that's a
Speaker 1: huge if. I mean, all we really have is twenty
Speaker 1: eight logos of companies and Facebook saying they want to
Speaker 1: do it. We don't really have the kind of you know,
Speaker 1: infrastructure and commitment. I'm sorry. The other thing we do
Speaker 1: have is Facebook has invested a ton of money in
Speaker 1: writing code and developing this. But if it is successful,
Speaker 1: it will make it much easier to use cryptocurrencies, and
Speaker 1: I think it would tame the volatility and cryptocurrency quite
Speaker 1: a bit. Aaron, how do you think the regulatory environment
Speaker 1: around crypto broadly defined, is going to evolve. I think
Speaker 1: when the Facebook made its announcement about libra that kind
Speaker 1: of perked up the ears of a lot of regulators
Speaker 1: and politicians in Washington. How do you think this is
Speaker 1: going to evolve? You know, I think my I usually
Speaker 1: feel this. You know, we're we're going to work out
Speaker 1: to a sensible consensus. There are some real advantages. They're
Speaker 1: tremendous economic advantages to going to crypto, and libra is
Speaker 1: a much better form of cash than dollars or gold
Speaker 1: or or anything else people have used, you know, seashells
Speaker 1: or salt or big rocks. But so so it's going
Speaker 1: to happen. I think some form of global digital currency,
Speaker 1: digital cash will be around, and I think regulators will
Speaker 1: allow the innovations and useful parts of crypto. But it
Speaker 1: also raises you know, it kind of undermines a regulatory regime.
Speaker 1: An awful lot of law, especially taxes, but also other
Speaker 1: laws are enforced through currency regulations. Uh, if everybody is
Speaker 1: using cash, you know, if there's no paper record, or
Speaker 1: at least no traceable, searchable law enforcement record of transactions,
Speaker 1: an awful lot of crimes become a lot easier. We
Speaker 1: used to have one of those common crimes we used
Speaker 1: to have was mugging. Now people just don't carry enough
Speaker 1: cash to make mugging worthwhile. Right now, the credit cards
Speaker 1: is a huge issues switch to hacking, right so criminals
Speaker 1: are going to switch to whatever, uh whatever works for them.
Speaker 1: But so there's a tremendous amount of regulatory work that
Speaker 1: has to be done. You know, people have to agree
Speaker 1: on regulations. There are, of course many people in crypto
Speaker 1: who feel that they can do without governments and go
Speaker 1: through it, but that's just not realistic. Very good. Thank
Speaker 1: Aaron Brown, Thank you so much. A calmness for Bloomberg
Speaker 1: Opinion talking all things trip though. Thanks for listening to
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Speaker 1: I'm Paul Sweeney, I'm on Twitter at pt Sweeney. I'm
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