WEBVTT - More Job Cuts at Meta and Big Equity Firms Circle SVB Assets 0:00:01.560 --> 0:00:05.240 From Mark Hard. We're Innovation, Money and Power Colne in 0:00:05.360 --> 0:00:10.320 Silicon Valley, NBR. This is Bloomberg Technology with Caroline Hide 0:00:10.320 --> 0:00:27.000 and Ed loved Love. I'm Caroline Hide of Bloomberg's World 0:00:27.000 --> 0:00:29.960 headquarters in New York and am Lovelow in San Francisco. 0:00:30.040 --> 0:00:33.080 This is Bloomberg Technology and a banking crisis to layoffs 0:00:33.159 --> 0:00:36.000 keeps the tech sector in focus. Caroline, Yeah, from crisis 0:00:36.000 --> 0:00:39.120 to fundamentals. We talk jobs, we talk inflation. Coming up, 0:00:39.200 --> 0:00:41.519 let's talk exactly that more job cuts at Metro in 0:00:41.560 --> 0:00:44.960 particular the company planning to slash ten thousand rolls head 0:00:44.960 --> 0:00:48.560 and five thousand vacant positions. Or on the company's restructuring ahead, 0:00:49.320 --> 0:00:51.479 and we'll have the latest on the collapse of Silicon 0:00:51.600 --> 0:00:54.640 Valley Bank and the big three private equity firms looking 0:00:54.640 --> 0:00:58.000 to snap up the bank's assets. And sticking with SVB, 0:00:58.400 --> 0:01:00.920 we'll talk take a deeper die into the state of 0:01:01.000 --> 0:01:04.040 venture capital and talk executive leadership. The tray Stevens are 0:01:04.040 --> 0:01:08.240 founders Fund and former IBM CEO Jinny Rametti. But again 0:01:08.360 --> 0:01:10.840 day two of our new time of the show, and 0:01:10.920 --> 0:01:13.680 we look at the market repercussions. What a difference a 0:01:13.760 --> 0:01:15.720 day makes as we drive higher on the NASTAP, but 0:01:15.760 --> 0:01:18.560 this time we see bonnials actually rising. After we saw 0:01:18.640 --> 0:01:21.399 yesterday the collapse in borrowing costs, we anticipated the Federal 0:01:21.440 --> 0:01:23.560 Reserve that just had to pull back in the face 0:01:23.600 --> 0:01:26.160 of a banking crisis. Today we look at inflation data 0:01:26.240 --> 0:01:28.240 and we note that CPI is still running hot. It 0:01:28.280 --> 0:01:30.240 means the Federal Reserve is likely still to have to 0:01:30.319 --> 0:01:32.600 hike thirty five basis points and moves higher on the 0:01:32.640 --> 0:01:36.080 two year. We also see the KBW Bank index really 0:01:36.120 --> 0:01:38.319 take a sigh of relief. We're just starting to digest 0:01:38.319 --> 0:01:41.800 the repercussions of SVB the crisis, and now we're dialing 0:01:41.840 --> 0:01:44.240 back our anxiety. We're up almost five percent on this 0:01:44.360 --> 0:01:46.800 particular bank index. Flip it on tell me where we're 0:01:46.840 --> 0:01:49.720 also up for a second straight day. Bitcoin the reprieve 0:01:49.920 --> 0:01:52.680 is relentless. We are up another seven percent. We are 0:01:52.680 --> 0:01:55.520 now trading the highest on Bitcoin. The og of crypto 0:01:55.720 --> 0:01:59.760 ed well since June twenty twenty two. Look at the CPI, 0:02:00.120 --> 0:02:02.080 a real driver in the market. Most of the tech 0:02:02.160 --> 0:02:05.000 names in the NASA one hundred a really policy sensitive 0:02:05.040 --> 0:02:07.920 index higher Nvidia and Apple the biggest points. Moves to 0:02:07.960 --> 0:02:10.520 the upside interesting to track the ride share is Uber 0:02:10.560 --> 0:02:14.480 and Lyft, both higher after the California Appeals Court reaffirms 0:02:14.520 --> 0:02:18.560 that a gig worker is an independent contractor, not an employee. 0:02:18.720 --> 0:02:22.280 Flip up the board's meta. Ten thousand more staff to 0:02:22.400 --> 0:02:26.280 be cut, Mark Zuckerberg, citing the economy shares up six 0:02:26.560 --> 0:02:28.800 and a half percent. We knew this was coming, but 0:02:28.880 --> 0:02:31.600 let's bring in Sarah Fryer from Bloomberg News to talk 0:02:31.639 --> 0:02:34.320 about this, because Sarah, ten thousand a big number. What 0:02:34.360 --> 0:02:36.800 else have we learned about the specifics of this latest 0:02:36.840 --> 0:02:40.520 round of layoffs. Well, this is the second big round 0:02:40.520 --> 0:02:43.080 for MATA in the last six months. So I think 0:02:43.200 --> 0:02:45.600 what we're really hearing from most of our sources is 0:02:45.639 --> 0:02:49.120 just that the morale is hitting a low point at 0:02:49.120 --> 0:02:52.320 the company and workers have had a lot of anxiety 0:02:52.400 --> 0:02:55.680 about what might come next. And of course MATTA is 0:02:55.720 --> 0:02:58.480 saying that it is still working to continue to restructure 0:02:58.520 --> 0:03:02.120 the company, including by flattening the organization. They want to 0:03:02.160 --> 0:03:05.800 make sure that managers aren't you having just a couple 0:03:06.000 --> 0:03:08.959 direct reports. They want to make sure that that engineers 0:03:09.080 --> 0:03:13.080 to managers ratio is a little healthier. In Zuckerberg's eyes, 0:03:13.160 --> 0:03:17.800 in giving them more ability to release products faster, to 0:03:17.880 --> 0:03:22.480 be more efficient. They think that reducing the number of 0:03:22.520 --> 0:03:24.840 middle managers will really help them get there. But this 0:03:24.919 --> 0:03:28.560 is really about the Zuckerberg's Year of efficiency. He's all 0:03:28.600 --> 0:03:32.160 about efficiency. That is what is driving the stock, and 0:03:33.040 --> 0:03:35.680 whilst you seem to like it, they do still seem 0:03:35.720 --> 0:03:38.360 to like it, even though many those working at the 0:03:38.440 --> 0:03:41.240 company still don't know whether they'll be keeping their jobs 0:03:41.280 --> 0:03:44.000 by a proliff. You're on the tech groups, it's going 0:03:44.000 --> 0:03:45.720 to be if you're more on the business line, not 0:03:45.760 --> 0:03:49.160 finding out till may. From a morale perspective. Therefore, moving 0:03:49.200 --> 0:03:51.920 more to I thought the buzzwords were interesting the fact 0:03:51.920 --> 0:03:53.440 that he's still saying we're going to be investing in 0:03:53.560 --> 0:03:56.720 artificial intelligence. It didn't feel like he was really doubling 0:03:56.720 --> 0:04:00.720 down on metavers even though that is still their big focus. Yeah, 0:04:00.760 --> 0:04:03.200 that's that's been interesting for us too. We've really heard 0:04:03.240 --> 0:04:07.720 that Zuckerberg's focus on AI has been prominent in these 0:04:07.800 --> 0:04:11.080 last few weeks and months, which which has some employees 0:04:11.120 --> 0:04:15.000 wondering whether that metaverse mission is as all encompassing as 0:04:15.200 --> 0:04:18.200 he previously made it sound. Of course, Oculus sales are 0:04:20.120 --> 0:04:23.400 they are he says they're strong, but certainly they had 0:04:23.400 --> 0:04:26.920 to reduce the price recently. There are some indications that 0:04:27.000 --> 0:04:29.960 it just really isn't catching on among consumers at the 0:04:30.040 --> 0:04:33.720 rate that they expected. So I think that going all 0:04:33.760 --> 0:04:37.359 in on AI is his next move here and and 0:04:37.600 --> 0:04:40.919 really relates also to the business. I mean, they have 0:04:40.960 --> 0:04:42.960 to use AI to improve their algorithm, they have to 0:04:43.040 --> 0:04:46.120 use AI to make up for the deficiencies and their 0:04:46.120 --> 0:04:50.880 advertising work. Because of the changes that Apple made to tracking, 0:04:51.600 --> 0:04:53.840 shares up more than six percent, biggest jump in around 0:04:53.880 --> 0:04:56.440 six weeks, Sarah, As you and I have reported, By contrast, 0:04:56.520 --> 0:05:00.640 morale is pretty much rock bottom with inside Meta. Remind 0:05:00.720 --> 0:05:03.160 us why this is happening now. We had some reporting 0:05:03.160 --> 0:05:05.919 about the urgency to get these job cuts done about 0:05:05.920 --> 0:05:08.800 Mark Zuckerberg in particularly and what he's about to do well. 0:05:08.839 --> 0:05:10.920 He wants to make sure that they could meet some 0:05:11.240 --> 0:05:14.400 lower expense schools. They really want to make sure that 0:05:14.440 --> 0:05:19.440 they can be a more efficient organization as revenue growth slows. Now, 0:05:19.520 --> 0:05:25.880 the context here is that these platforms that they've created, Facebook, Instagram, 0:05:26.080 --> 0:05:29.600 these giants are really not growing as fast as they 0:05:30.200 --> 0:05:33.680 used to. They're trying to grow the attention, but the 0:05:33.760 --> 0:05:36.320 user base is already very saturated around the world, so 0:05:36.360 --> 0:05:39.480 they have to come up with other ways to get 0:05:39.480 --> 0:05:43.039 their profits in line with what walshrit expects to keep 0:05:43.080 --> 0:05:46.600 that growth going. And this is how they're doing it. 0:05:46.880 --> 0:05:50.800 And I think that that Meta really saw an opportunity. 0:05:50.839 --> 0:05:53.240 It's not that they have to or else will there 0:05:53.279 --> 0:05:55.479 will be some dire hostel pusiness for their business, but 0:05:55.480 --> 0:05:57.680 they saw an opportunity in this moment where a lot 0:05:57.720 --> 0:05:59.920 of companies are doing this, to say listen, we can 0:06:00.120 --> 0:06:01.640 do it and it won't reflect badly on us, and 0:06:01.640 --> 0:06:04.000 in fact, it will make us look smart. And a 0:06:04.040 --> 0:06:07.520 time of course emergency when there's an addition to his 0:06:07.560 --> 0:06:10.200 own family as well as his Meta family with the 0:06:10.279 --> 0:06:12.640 Zuckerberg household at the moment about to go and parental 0:06:12.720 --> 0:06:15.120 leaf serify, We thank you so much for digging in 0:06:15.160 --> 0:06:18.080 on the Meta news now. Of course, Meta job cuts 0:06:18.080 --> 0:06:21.560 makes us think about fundamentals inflation, in particularly the CPI 0:06:21.640 --> 0:06:24.480 print keeping pressure. It would seem on the Federal Reserve 0:06:24.839 --> 0:06:27.360 the most critic up to you got more on it, Yeah, Caroline, 0:06:27.360 --> 0:06:29.880 it does feel like the focus has kind of shifted, 0:06:29.960 --> 0:06:31.960 maybe just a little bit away from the banking fall 0:06:32.160 --> 0:06:35.320 back into the idea of CPI. This highly awaited report 0:06:35.560 --> 0:06:38.760 from the Federal feeds me from the Bureau of Economics, 0:06:38.760 --> 0:06:40.839 and this is really important because you are seeing a 0:06:40.920 --> 0:06:43.640 deceleration inflation. This is good news for the Federal Reserve 0:06:43.720 --> 0:06:46.280 for the first time in about a year. Economists we're 0:06:46.360 --> 0:06:49.880 banging on estimates zero four point four percent rise month 0:06:49.880 --> 0:06:52.560 over month, on a yearly basis, a six percent rise. 0:06:52.560 --> 0:06:55.600 But if the components that matter here, because services inflation 0:06:55.920 --> 0:06:58.640 is still rising, goods inflation is coming down. You're seeing 0:06:58.640 --> 0:07:02.080 those shelter costs in particular decelerating. The housing market has 0:07:02.120 --> 0:07:04.760 been in focus for a while, but commodity pressures are 0:07:04.839 --> 0:07:07.120 kind of coming back up. You're seeing that in gas prices, 0:07:07.160 --> 0:07:10.000 in food prices, and that's what the Federal Reserve is 0:07:10.000 --> 0:07:13.160 going to see as the danger. And that really factors 0:07:13.200 --> 0:07:15.600 into the repricing that you're seeing into the markets. Because 0:07:15.600 --> 0:07:18.840 after the SVB fallout, Caroline and ed who did see 0:07:18.840 --> 0:07:21.559 the market reprice from a five point eight percent terminal 0:07:21.640 --> 0:07:23.760 rate over the summer all the way down to five 0:07:23.880 --> 0:07:27.000 five point one percent again over the summer, essentially saying 0:07:27.000 --> 0:07:29.440 that look, this tightening cycle is over. In the just 0:07:29.560 --> 0:07:32.200 really the last twenty four hours. Especially with the CPI report, 0:07:32.240 --> 0:07:34.800 you are now seeing that terminal rate come back higher 0:07:34.800 --> 0:07:37.280 and higher. Wall Street now split. You have calls from 0:07:37.360 --> 0:07:39.840 likes of City, for example, a fifty basis point hight 0:07:40.040 --> 0:07:42.440 to really keep the pressure on inflation all the way 0:07:42.520 --> 0:07:45.120 to the other side of the spectrum, Nomura perhaps talking 0:07:45.120 --> 0:07:47.040 about a rate cut and even at the end of 0:07:47.120 --> 0:07:49.640 quantitative tightening, something that would bode well for a lot 0:07:49.680 --> 0:07:51.720 of the technology names. And that's why I was saying 0:07:51.760 --> 0:07:54.200 that now's not having its best day since February twenty 0:07:54.400 --> 0:07:57.520 trying three of the CIA pretty great revoting. Thank you. 0:07:57.600 --> 0:08:01.160 Let stick on valuations at stick on fundamentals with CPI 0:08:01.240 --> 0:08:03.760 with jobs as talk to the Wee family officers CEO 0:08:04.200 --> 0:08:07.000 Lago Messino and Advice refirm everything. Get this, more than 0:08:07.040 --> 0:08:10.560 fourteen billion dollars in assets and I just melt reassert 0:08:10.720 --> 0:08:12.760 your focus here when we're trying to work out the 0:08:12.840 --> 0:08:15.600 direction of interest rates. What does it mean from your 0:08:15.720 --> 0:08:22.480 perspective on tech valuations, Well, I think that obviously tech 0:08:22.640 --> 0:08:28.240 valuations are likely to increase, particularly over a longer period 0:08:28.280 --> 0:08:30.360 of time, So you know, I'm a tech ball over 0:08:30.480 --> 0:08:32.560 the next five to ten years, I think a lot 0:08:32.600 --> 0:08:35.880 of the issues we're dealing with, like involation, are going 0:08:35.920 --> 0:08:39.160 to be solved through increased productivity. And the answer the 0:08:39.240 --> 0:08:45.240 productivity are all these tech companies and tech processes that 0:08:45.360 --> 0:08:47.679 are really going to help us become a lot more productive. 0:08:48.160 --> 0:08:50.920 So I think when interest rates were zero, people were 0:08:51.000 --> 0:08:54.880 willing to pay everything for growth. As interest rates have 0:08:55.160 --> 0:08:59.240 come up, the valuations came down. But now you're actually saying, 0:08:59.280 --> 0:09:01.280 I think we're getting towards the end of a cycle, 0:09:01.400 --> 0:09:06.880 so I expect that the valuations will increase, particularly because 0:09:06.960 --> 0:09:09.640 you have so many tail wins with a lot of 0:09:09.720 --> 0:09:13.400 these tech strategies. So you know, whether we're talking about AI, 0:09:13.840 --> 0:09:17.920 or we're talking about electric vehicles or we're talking about 0:09:18.400 --> 0:09:20.920 a farm mine, you start to see the activity that's 0:09:20.960 --> 0:09:24.120 going on in the space. I continue to be a 0:09:24.240 --> 0:09:27.400 tech bull, but I'm a tech bull over time. So 0:09:27.520 --> 0:09:29.959 I think if you think about the next three five years, 0:09:30.640 --> 0:09:33.959 we're going to have much higher valuations for these companies. Okay, 0:09:34.120 --> 0:09:37.720 so you're liking perhaps an Nvidia that has exposure both 0:09:37.800 --> 0:09:41.400 to the autosector but also the AI focus. Who where 0:09:41.440 --> 0:09:43.640 are the companies? Where are the opportunities that you think 0:09:43.720 --> 0:09:48.000 if you're going to allocate money now you should be fine, Well, 0:09:48.280 --> 0:09:50.599 I think there's a lot more opportunity actually in the 0:09:50.679 --> 0:09:53.600 private space than in the public space. And I think 0:09:53.640 --> 0:09:56.080 when you think about the public space, we have five 0:09:56.120 --> 0:09:58.840 thousand companies, right when you think about the private space, 0:09:59.200 --> 0:10:02.160 you have a million companies. And I think the opportunity 0:10:02.240 --> 0:10:05.199 in the public space is going to be because the 0:10:05.320 --> 0:10:09.439 public companies are buying these private companies to actually be 0:10:09.520 --> 0:10:12.679 able to have access to these technologies. And so when 0:10:12.720 --> 0:10:17.280 you look at Adviser buying Siegen, or you think about 0:10:17.920 --> 0:10:23.319 Google's investments or Microsoft's investments in AIM, I think that 0:10:23.559 --> 0:10:27.080 that's where you're going to see the growth. But obviously 0:10:27.160 --> 0:10:30.040 I think the opportunity is much greater in the private space. 0:10:31.960 --> 0:10:35.720 Mel we think about inflation, we think about the FED, 0:10:35.800 --> 0:10:37.720 but I'm looking at some of the movers in the market. 0:10:37.800 --> 0:10:42.040 In earnings is still such a big driver of individual 0:10:42.120 --> 0:10:46.280 share moves, particularly in the technology sector. There's a discussion 0:10:46.320 --> 0:10:49.240 to be had around how the rest of the year 0:10:49.360 --> 0:10:52.360 looks to tech and whether they're recalibrating the strength of 0:10:52.360 --> 0:10:55.559 the economy. You saw Mark Zuckerberg's site the sort of 0:10:55.679 --> 0:10:58.800 longevity of headwinds that his company faces in the economy. 0:10:59.040 --> 0:11:00.920 Do you think we need to again when it comes 0:11:00.960 --> 0:11:05.000 to earnings expectations? Yes, because and I think that's why 0:11:05.040 --> 0:11:07.439 you're seeing the layoffs and the tech companies, because a 0:11:07.480 --> 0:11:09.439 lot of the growth had to do with number of 0:11:09.520 --> 0:11:13.800 subscribers for new customers, new markets that were opening up, 0:11:14.200 --> 0:11:16.840 and because I think a lot of these companies actually 0:11:16.960 --> 0:11:19.719 have huge market share. The name of the game is 0:11:19.800 --> 0:11:22.320 not going to be how many new subscribers or how 0:11:22.360 --> 0:11:25.160 many new clients. It's going to be how can you 0:11:25.320 --> 0:11:30.000 actually change your business model to create more profitability. So, 0:11:30.200 --> 0:11:33.800 whether you're looking at a Facebook or you're looking at 0:11:34.200 --> 0:11:36.480 any of the media companies, I think the name of 0:11:36.520 --> 0:11:40.040 the game has changed. I think what people are really 0:11:40.160 --> 0:11:44.240 looking for is profits and higher margins. Now you're the 0:11:44.320 --> 0:11:47.240 former CEO of JP Morgan's private bank. What have you 0:11:47.360 --> 0:11:50.680 made the last five days in the banking sector particularly 0:11:50.720 --> 0:11:54.439 and how it's hit tech. Well, I mean, obviously, I 0:11:54.559 --> 0:11:59.280 think from the perspective of JP Morgan, it's been like 0:11:59.440 --> 0:12:02.839 a birthday party because everybody has tried to take their 0:12:02.880 --> 0:12:05.040 money out of the banks, out of the other banks 0:12:05.280 --> 0:12:10.439 and put them primarily in JP Morgan. So I think 0:12:10.480 --> 0:12:13.079 that's good news for JP Morgan. In terms of the 0:12:13.160 --> 0:12:15.920 tech sector, I think when it comes, for example, to 0:12:16.000 --> 0:12:19.000 the venture space, I think we're going to I think 0:12:19.040 --> 0:12:22.840 we're going to see maybe lower evaluations, which is actually 0:12:22.920 --> 0:12:26.959 a great opportunity for venture investors. I think what's so 0:12:27.120 --> 0:12:30.160 interesting in particularly Caroline, is how we're threading what's happening 0:12:30.200 --> 0:12:33.199 with SVB to what's happening in the global economy. The 0:12:33.280 --> 0:12:36.720 commonality appears to be that tech companies all sizes are 0:12:36.800 --> 0:12:39.800 under duress. Yeah, largely because interest rates are having to 0:12:39.840 --> 0:12:41.800 go up. They're having to think about costs, and that 0:12:41.960 --> 0:12:44.880 means people and mel it also means people who are 0:12:44.920 --> 0:12:47.559 managing these businesses. You're someone who not only was a 0:12:47.760 --> 0:12:50.040 very senior at JP Morgan and now running around money 0:12:50.080 --> 0:12:53.240 in this respect for family offices, but also someone who's 0:12:53.240 --> 0:12:55.440 on the border Cocacola and Disney. What do you make 0:12:55.480 --> 0:13:00.079 of executive oversight here and board oversight? I think I 0:13:00.200 --> 0:13:05.199 think board oversight has never has never been more important. 0:13:05.760 --> 0:13:10.600 And I think that especially usuals like cybersecurity, for example, 0:13:12.000 --> 0:13:14.599 are more important than ever. And I think that the 0:13:14.760 --> 0:13:17.160 kind of credentials that you need to be able to 0:13:17.280 --> 0:13:19.439 have and the kind of work that you need to 0:13:19.480 --> 0:13:21.760 be able to do to serve on these boards has 0:13:21.840 --> 0:13:26.800 increased dramatically. We family officers, CEO mel la A Messino, 0:13:27.280 --> 0:13:29.160 thank you so much. Which can breaking headlines on the 0:13:29.200 --> 0:13:34.079 Bloomberg terminal. Caroline AMC Entertainment shareholders have approved a common 0:13:34.160 --> 0:13:38.079 share increase, issuing new equity the shares responding inevitably to 0:13:38.200 --> 0:13:40.120 those headlines. A crossing the Bloomberg will bring you more 0:13:40.280 --> 0:13:50.320 as we have it. Of course, we'll continue to watch 0:13:50.360 --> 0:13:53.280 the fallout of Silicon Valley banks sudden collapse and that 0:13:53.440 --> 0:13:56.880 as we understand that Apollo Kko Blackstone showing interest in 0:13:57.000 --> 0:13:59.760 spb's loan book for example here to cover all of 0:13:59.800 --> 0:14:02.760 it origin Nati Bassak and we now sought to understand 0:14:02.840 --> 0:14:06.800 where many feel value actually lies. We are and when 0:14:06.840 --> 0:14:08.160 you look at it, we have the loan book that 0:14:08.280 --> 0:14:10.839 is worth more than seven billion, seventy billion dollars, so 0:14:10.960 --> 0:14:14.040 it's quite large. The question is will Apollo Kker blacksone 0:14:14.080 --> 0:14:16.280 will they start to bid on parts of it or 0:14:16.440 --> 0:14:18.640 all of it? More likely you'll see them bid on 0:14:18.760 --> 0:14:21.360 parts of it. Because the idea here and this is 0:14:21.440 --> 0:14:25.000 great analysis by Bloomberg Intelligence as well. Here this is 0:14:25.040 --> 0:14:27.160 a loan book that has not lost a lot of money. 0:14:27.200 --> 0:14:29.440 There's a lot of questions and concerns about the quality 0:14:29.480 --> 0:14:31.840 of the loans underpinning given that Silicon Valley Bank was 0:14:31.880 --> 0:14:35.640 so aggressive encoding Silicon Valley and the tech entrepreneurs and 0:14:35.680 --> 0:14:39.400 sometimes unprofitable companies. But the idea here is Apollo Kiker 0:14:39.480 --> 0:14:42.920 blacks on their credit their experts here their credit experts. 0:14:42.960 --> 0:14:44.760 So the idea is that if they take on these 0:14:44.840 --> 0:14:47.280 loan books, they take on these clients and they feel 0:14:47.320 --> 0:14:50.280 that they could do a better job at managing these loans. 0:14:50.520 --> 0:14:52.960 But with that said, there are other assets as well, 0:14:53.080 --> 0:14:56.080 including the venture on the asset manager, if you will, 0:14:56.160 --> 0:14:58.440 and the investment bank that worked on about ninety nine 0:14:58.480 --> 0:15:01.440 billion dollars with deals last year. And what's so interesting 0:15:01.480 --> 0:15:03.200 is we still to try and think about where the 0:15:03.280 --> 0:15:06.080 value is A Shinali outlines. Sali, we were just talking 0:15:06.160 --> 0:15:08.120 to mel over at we Family Offices and she was 0:15:08.160 --> 0:15:10.280 talking about board oversight and the need for that at 0:15:10.280 --> 0:15:13.800 the moment. There's real due diligence going in what executives 0:15:13.840 --> 0:15:16.080 were and we're not doing at this time. Yeah, Look, 0:15:16.160 --> 0:15:19.120 the FDIC came in an appointed new leadership at Silicon 0:15:19.240 --> 0:15:21.960 Valley Bank, but inevitably, Shinali, there is a post mortem 0:15:22.080 --> 0:15:25.400 going on and what happened and the action that executives took. 0:15:25.480 --> 0:15:27.640 What have we reported in the last hour. There are 0:15:27.640 --> 0:15:29.240 a few things to keep an eyron here ed, and 0:15:29.360 --> 0:15:32.160 that is both the investigation that is happening when it 0:15:32.520 --> 0:15:35.840 comes to Silicon Valley Bank, it's executives actions taken before. 0:15:36.200 --> 0:15:38.560 There are so many critics in the market that say, listen, 0:15:38.680 --> 0:15:40.560 some of these issues we have known about when it 0:15:40.640 --> 0:15:43.240 comes to their balance sheet management. But even beyond that, 0:15:43.520 --> 0:15:46.320 the stock sales from the manager is particularly the CEO, 0:15:46.480 --> 0:15:50.080 Greg Becker, leading into a lot of the disclosures of 0:15:50.160 --> 0:15:52.920 the information that we had seen before the collapse of 0:15:52.960 --> 0:15:56.760 Silicon Valley Bank. In addition to that, I would also remember, 0:15:56.920 --> 0:16:00.720 while you have the DJ and the SEC forming investigations 0:16:00.800 --> 0:16:03.560 around the collapse of Silicon Valley Bank and the management 0:16:03.640 --> 0:16:06.280 of it, you also have the Federal Reserve doing its 0:16:06.320 --> 0:16:10.680 own investigation of how itself has handled the situation. So 0:16:11.480 --> 0:16:15.400 really questions all around the board here. The reason we're 0:16:15.520 --> 0:16:18.040 tracking both threads of the story is even twenty four 0:16:18.080 --> 0:16:19.920 hours ago, we had a key bench catalyst on this 0:16:20.040 --> 0:16:23.480 program saying we want Silicon Valley Bank to survive in 0:16:23.640 --> 0:16:26.360 some form because we've always done business with them and 0:16:26.440 --> 0:16:29.440 we want to continue carrow. Yeah. And I think also 0:16:29.560 --> 0:16:32.240 people juxtaposing the decisions that were made in the US 0:16:32.320 --> 0:16:35.960 for the regulators versus the UK UK very swiftly getting 0:16:36.000 --> 0:16:37.920 a buyer, I mean at a very rock bottom price 0:16:37.960 --> 0:16:39.640 that has to be said, I mean one pound for 0:16:39.880 --> 0:16:42.440 svb ucastionally. But what have you made of the difference? 0:16:42.520 --> 0:16:44.640 Is that a huge differences And remember it is a 0:16:44.720 --> 0:16:46.760 smaller arm when you're looking at the UK arm. There's 0:16:46.800 --> 0:16:48.880 been a lot of questions on Friday morning when we 0:16:48.960 --> 0:16:51.040 all woke up. There's a question about half of Wall 0:16:51.080 --> 0:16:53.920 Streets circling these assets. If you take a look to 0:16:54.000 --> 0:16:56.400 the point that ED had made, there has been drips 0:16:56.440 --> 0:16:59.480 and drabs of plans announced on restructuring, but there has 0:16:59.520 --> 0:17:02.760 been no bank ruptcy filing. That's an important differentiation here 0:17:02.880 --> 0:17:04.760 because had there been one, then it would be up 0:17:04.840 --> 0:17:07.520 to kind of the jurisdiction of a judge in that 0:17:07.760 --> 0:17:10.640 sort of a situation. But now that you have these 0:17:10.720 --> 0:17:13.320 assets slowly coming up for sale, it makes it a 0:17:13.359 --> 0:17:16.440 little easier for different parts of Wall Street to absorb 0:17:16.520 --> 0:17:20.160 these things, particularly in a way that's compliant with regulations 0:17:20.480 --> 0:17:22.440 and could help them avoid a lot of the two 0:17:22.480 --> 0:17:26.080 thousand and eight era liabilities that cost firms like JP 0:17:26.280 --> 0:17:29.320 Morgan a lot of money coming out of the post 0:17:29.400 --> 0:17:33.560 two thousand and eight investigations. Wool Street is debating moral hazard, 0:17:33.640 --> 0:17:36.560 as we've been discussing on air all day. Just very quickly, Shannali, 0:17:36.840 --> 0:17:39.280 how do the banks look this Tuesday? I mean, there's 0:17:39.280 --> 0:17:42.040 still concerned about the sector, right there's certainly self concerned 0:17:42.040 --> 0:17:44.440 about the sector. But there was a lot of acknowledgment 0:17:44.520 --> 0:17:46.920 that silk On Valley Bank was an outlier in terms 0:17:46.960 --> 0:17:49.399 of the way that it's deposit based looked and the 0:17:49.480 --> 0:17:51.760 way they manage their assets ed. We have to look 0:17:51.760 --> 0:17:54.600 at other sectors now also as we weigh the lagged 0:17:54.680 --> 0:17:58.040 impact of interest rates commercial real estate that is maybe 0:17:58.160 --> 0:18:01.119 not as front and center and emotional Silicon Valley Bank is, 0:18:01.560 --> 0:18:04.879 but certainly it's a slower leading problem, and so we 0:18:04.960 --> 0:18:06.600 are certainly not out of the woods. Though it is 0:18:06.720 --> 0:18:08.639 a big relief to the market to see the regional 0:18:08.680 --> 0:18:11.399 bank stops hop back up, particularly with the likes of 0:18:11.480 --> 0:18:13.200 a First Republic and some of the banks on the 0:18:13.280 --> 0:18:15.879 West coast like Western Alliance and Pac West that some 0:18:15.960 --> 0:18:18.680 of the market was concerned about yesterday. Shnani, how many 0:18:18.680 --> 0:18:21.399 cups of coffee on today? I won't disclose that on air. 0:18:22.400 --> 0:18:25.280 A lot, folks, It's a lot Shani Bassak always there 0:18:25.520 --> 0:18:28.760 with their caffeinated hies. We thank us so much. Ed Yeah, 0:18:28.880 --> 0:18:32.240 coming up, we'll continue the conversation. The UK's Communications Regulators 0:18:32.280 --> 0:18:35.400 says the BBC has to change. We'll tell you why 0:18:35.520 --> 0:18:37.879 next in Talking Tech and as we look at some 0:18:37.960 --> 0:18:40.520 other movers out there in the market, Arc Innovation ets 0:18:40.680 --> 0:18:43.720 OR it's biggest inflows since twenty twenty one, that ETF 0:18:43.840 --> 0:18:46.200 around up around two and a half percent. In this session, 0:18:46.240 --> 0:18:49.000 we'll dig into the specifics. That's next. This is bloomberg 0:19:05.680 --> 0:19:09.159 time for Talking Tech. The BBC has got to change, 0:19:09.240 --> 0:19:13.119 says Melanie Dawes, the head of the UK's Communications Regulators, 0:19:13.160 --> 0:19:16.359 saying that the public broadcaster should let freelancers who are 0:19:16.400 --> 0:19:19.960 not involved in news reporting have more freedom of expression 0:19:20.200 --> 0:19:22.840 on social media. This comes after a high profile row 0:19:23.200 --> 0:19:27.040 between BBC management and popular football show host Gary Lineker 0:19:27.400 --> 0:19:30.920 over his tweet commenting on the UK government's new immigration 0:19:31.000 --> 0:19:36.199 bill and whether that tweet breached the broadcasters commitment to impartiality. Meanwhile, 0:19:36.240 --> 0:19:39.359 Blackstone agreed to buy c Then for eight dollars fifty 0:19:39.400 --> 0:19:42.320 cents per share and the enterprise value of about four 0:19:42.400 --> 0:19:45.639 point six billion dollars for the event management software company. 0:19:45.720 --> 0:19:49.280 Blackstone has received a fully committed one billion dollar credit 0:19:49.359 --> 0:19:52.520 facility as part of the financing of this transaction, which 0:19:52.640 --> 0:19:56.199 expects to close mid year. And finally, Kathy Wood's Ark 0:19:56.280 --> 0:19:59.440 Innovation ETF is getting a strong vote of investor confidence. 0:19:59.480 --> 0:20:02.280 The ETF attracted close to four hundred million dollars of 0:20:02.320 --> 0:20:06.480 inflows on Friday, according to overnight data compiled by Bloomberg, 0:20:06.560 --> 0:20:09.640 the largest influx since April twenty twenty one, a time 0:20:09.680 --> 0:20:12.040 when the fun hit it's all time high during the 0:20:12.160 --> 0:20:15.600 cheap money era. Caroline money is still going somewhere and 0:20:15.680 --> 0:20:26.200 this current volatility. Welcome back to Blue Meg Technology and 0:20:26.280 --> 0:20:29.639 Caroline Hyde in New York. And let's keep ourselves up 0:20:29.640 --> 0:20:32.879 to date with US authorities currently examining the collapse of 0:20:32.960 --> 0:20:37.000 Silicon Valley Bank for misconduct by officers, including whether stock 0:20:37.040 --> 0:20:40.280 sales for examples, by executives actually violated trading rules. It's 0:20:40.280 --> 0:20:42.639 all according to a source. We want to bring in 0:20:43.040 --> 0:20:45.560 a big name from Silicon Valley for her take on 0:20:45.600 --> 0:20:47.680 all of this, Jania Metti. She's a former CEO and 0:20:47.760 --> 0:20:50.680 chairman of IBM, board member of JP Morgan, and she's 0:20:50.680 --> 0:20:53.760 out with a new book on leadership called Good Power, 0:20:54.160 --> 0:20:57.920 Needing Positive Change in our lives, work and world. Boy, Jenny, 0:20:58.040 --> 0:21:00.560 do we need some positive change? What do you make 0:21:00.760 --> 0:21:04.880 of the focus in particular of oversight of board membership 0:21:04.920 --> 0:21:08.720 of executive management at this moment. Well, look, I think 0:21:09.200 --> 0:21:11.960 something I've learned over a long time and working with boards, 0:21:12.280 --> 0:21:14.720 it's never been more important and the importance to have 0:21:15.000 --> 0:21:17.960 on your board people with all different disciplines. So you 0:21:18.119 --> 0:21:21.159 just had Melon earlier talking about the importance of cybersecurity 0:21:21.480 --> 0:21:24.600 or those that have regulatory experience, etc. So it just 0:21:24.760 --> 0:21:27.880 goes to show it is a job that everyone really 0:21:27.920 --> 0:21:30.440 does need to take seriously. You sit on the board 0:21:30.480 --> 0:21:33.080 of JP Morgan, of course, one of the only big 0:21:33.160 --> 0:21:35.960 bank with still the same CEO from the crisis era 0:21:36.359 --> 0:21:38.760 with still that management oversight, And I'm interested is what 0:21:38.840 --> 0:21:41.720