WEBVTT - Bloomberg Businessweek Weekend - April 29th, 2022 0:00:01.040 --> 0:00:05.400 This is Bloomberg Business Week inside from the reporters and 0:00:05.600 --> 0:00:09.200 editors who bring you America's most trusted business magazine, plus 0:00:09.240 --> 0:00:13.200 global business finance and tech news as it happened. Bloomberg 0:00:13.240 --> 0:00:16.759 Business Week with Carol Messier and Bloomberg Quick Takes Tim 0:00:16.800 --> 0:00:21.320 Stinovic on Bloomberg Radio. Hi, everyone, welcome to the weekend 0:00:21.440 --> 0:00:24.680 edition of Bloomberg Business Week. Big tech earnings abound over 0:00:24.720 --> 0:00:26.680 the last few days. It was a busy week. We 0:00:26.720 --> 0:00:30.840 had Alphabet, Microsoft, Meta, Apple, Amazon, and oh yeah, Twitter, 0:00:31.040 --> 0:00:32.640 Yeah that one too, although that one kind of boring. 0:00:32.640 --> 0:00:35.160 I gotta be honest, Who cares? Who cares? Who cares? 0:00:35.200 --> 0:00:38.080 Speaking of Elon Musk making it official his forty four 0:00:38.200 --> 0:00:41.440 billion dollar bid for the social media platform, it was accepted, 0:00:41.800 --> 0:00:44.760 though there are still lingering questions about the deal's financing, 0:00:44.800 --> 0:00:47.960 who will ultimately take over a CEO, the political implications 0:00:47.960 --> 0:00:51.360 for the company, and what it means for Twitter's user base. 0:00:51.479 --> 0:00:53.000 That's what we cared about when it comes to Twitter, 0:00:53.080 --> 0:00:55.560 not the earnings, but this whole big deal. We'll have 0:00:55.640 --> 0:00:57.960 more in just a moment. Plus a pair of iconic 0:00:58.000 --> 0:01:01.520 retail brands going in opposite directions. We're going to talk 0:01:01.560 --> 0:01:03.960 to Mattel CEO on a possible sale of the company, 0:01:04.280 --> 0:01:07.080 and then profile a former Levis executive who stands on 0:01:07.160 --> 0:01:10.080 pandemic related policies. Well, it led to a very public 0:01:10.120 --> 0:01:13.959 departure and this week's cover story on China's COVID zero trap. 0:01:14.360 --> 0:01:16.560 We start this week with the man and the story 0:01:16.680 --> 0:01:19.320 that just keep on giving. We're talking about Elon Musk 0:01:19.360 --> 0:01:22.160 and his forty four billion dollar deal to take Twitter private. 0:01:22.600 --> 0:01:25.280 Every day there are multiple stories on this now his 0:01:25.400 --> 0:01:28.600 claim on the future of the First Amendment and content 0:01:28.680 --> 0:01:31.760 moderation on the platform. That's the story we want to 0:01:31.760 --> 0:01:34.280 get into, and that's exactly what Bloomberg Business Week editor 0:01:34.360 --> 0:01:37.360 Joel Webber and Features editor Max Chafkin talk to us about. 0:01:37.720 --> 0:01:40.360 There's free speech, which you know, I think I think 0:01:40.440 --> 0:01:43.720 most most people, especially most Americans kind of can kind 0:01:43.720 --> 0:01:46.039 of have some idea on and agree on. And then 0:01:46.080 --> 0:01:48.279 there's this kind of like political notion of free speech 0:01:48.320 --> 0:01:52.080 where um Republicans have started using that phrase and the 0:01:52.160 --> 0:01:54.400 right started using that phrase to complain like about a 0:01:54.480 --> 0:01:57.400 very specific and maybe narrower set of issues than one 0:01:57.440 --> 0:01:59.840 that like a constitutional scholar will be you know, inter 0:02:00.040 --> 0:02:03.040 sit in, and that is what Elon Musk has gravitated 0:02:03.080 --> 0:02:06.200 towards and that is why he's currently being celebrated, you know, 0:02:06.240 --> 0:02:08.200 on the right. If you if you turn on UM, 0:02:08.240 --> 0:02:12.040 you know, conservative talk radio or consertive television or whatever, 0:02:12.240 --> 0:02:15.040 Elon Musk is front and center. They are celebrating this. 0:02:15.120 --> 0:02:18.520 They're presenting this as you know, uh, Trump and his 0:02:18.600 --> 0:02:20.880 allies are going to be back on you know, back 0:02:20.919 --> 0:02:24.239 on social media. And it's like, you know, the resurgence 0:02:24.400 --> 0:02:27.240 of Trump is UM and Musk, I think, is embracing 0:02:27.280 --> 0:02:29.560 that and is trying to take advantage of it, both 0:02:29.600 --> 0:02:33.120 as a potential business strategy for Twitter, you know where 0:02:33.120 --> 0:02:35.640 where just just like you know, Fox News came along 0:02:35.680 --> 0:02:38.240 and presented itself as kind of like a right wing 0:02:38.280 --> 0:02:40.800 news network to CNNs, Like, I think that's kind of 0:02:40.840 --> 0:02:43.680 what Musk is going for here. It also has potential 0:02:43.720 --> 0:02:46.640 business implications for Tesla, which of course is UM you know, 0:02:46.760 --> 0:02:49.320 has a huge valuation and is trying to reach a 0:02:49.400 --> 0:02:53.200 different sector of consumer. Right now, let's talk about trucks, 0:02:53.240 --> 0:02:56.240 because uh, Elon's got a few that he might need 0:02:56.280 --> 0:02:58.880 to sell to some people who might lean a little 0:02:58.880 --> 0:03:04.840 bit more seen they well, right, so you know, we 0:03:04.680 --> 0:03:06.800 we had that on the cover of last week. You know, 0:03:06.960 --> 0:03:09.880 there is another cyber truck coming that. Now I think 0:03:09.919 --> 0:03:12.800 this is like a pretty savvy move. It's unclear it 0:03:12.800 --> 0:03:14.920 will work. And of course Tesla stock went you know 0:03:15.040 --> 0:03:18.320 down at the end of yesterday. But um, but I 0:03:18.360 --> 0:03:21.040 do think so. So Teslas sold a lot of cars 0:03:21.360 --> 0:03:24.280 to kind of wealthy environmentalists, right, there's there's sort of 0:03:24.320 --> 0:03:27.280 a limit to that market. And Americans buy a lot 0:03:27.320 --> 0:03:29.960 of trucks. And of course trucks are are much bigger 0:03:30.000 --> 0:03:32.040 in kind of red states they are in blue states. 0:03:32.040 --> 0:03:34.160 And we've seen Musk. This is not a new strategy 0:03:34.160 --> 0:03:38.520 for Musk. We saw him, you know, moving Tesla's operations 0:03:38.560 --> 0:03:41.920 from California to the Austin area and and talking about 0:03:41.960 --> 0:03:45.000 that in ideological terms. And of course they launched the 0:03:45.000 --> 0:03:47.680 the cyber truck, you know, at an event um a 0:03:47.720 --> 0:03:51.279 few weeks back in Austin cyber rodeo. Very much embracing 0:03:51.360 --> 0:03:54.400 you know, kind of Texas culture. And I think that's 0:03:54.560 --> 0:03:56.640 I think the jury is out on whether this will work. 0:03:56.720 --> 0:03:59.800 You know, Ford of course has a very strong, uh 0:04:00.000 --> 0:04:02.320 track record, you know, selling trucks that the f one fifty, 0:04:02.360 --> 0:04:03.840 as we wrote in our story, is you know, it's 0:04:03.840 --> 0:04:06.480 like one of the most successful consumer products of all time. 0:04:06.880 --> 0:04:08.640 But but I think musk is trying to take advantage 0:04:08.640 --> 0:04:11.360 of these political dynamics to find a niche well, and 0:04:11.760 --> 0:04:14.520 so are you. So is it basically right now? You know, 0:04:14.760 --> 0:04:17.640 his businesses, I think you write about his business interests 0:04:17.720 --> 0:04:21.320 influencing his political ideology. Is that what we're seeing right now? Yeah? 0:04:21.440 --> 0:04:23.920 I think with Musk, um, those two things are very 0:04:23.960 --> 0:04:26.320 closely connected. This is somebody who who has founded a 0:04:26.360 --> 0:04:28.800 series of companies that do business with the government. When 0:04:28.839 --> 0:04:31.360 you do business with the government, you know, primarily SpaceX, 0:04:31.360 --> 0:04:33.800 but of course Tesla got got a huge amount of 0:04:33.880 --> 0:04:37.000 government loan lending from uh in two thousand nine after 0:04:37.000 --> 0:04:40.080 the automotive crisis to benefits from these v credits. And 0:04:40.080 --> 0:04:41.800 when you do that, when you're in that business, you're 0:04:41.839 --> 0:04:44.359 you have to be political. So during the you know, 0:04:44.480 --> 0:04:46.880 the Obama era, must kind of cut this figure as 0:04:46.880 --> 0:04:50.720 this you know, stakeholder capitalist, this kind of green technocrat. Um. 0:04:50.839 --> 0:04:53.000 You know, during the Trump era he shifted a little 0:04:53.040 --> 0:04:55.200 bit back to the to the MAGA. You know, it's 0:04:55.240 --> 0:04:58.279 a little more MAGA friendly and now um, you know, 0:04:58.320 --> 0:05:00.720 with the right kind of research, it with it looks 0:05:00.760 --> 0:05:02.480 like in the in the United States, of course, U 0:05:02.720 --> 0:05:05.240 Republicans are likely to take you know, one, if not both, 0:05:05.240 --> 0:05:08.920 houses of Congress. I think he's he's making a political calculation, 0:05:09.320 --> 0:05:12.000 but it's also happening against a backdrop of an really 0:05:12.040 --> 0:05:15.159 important market to Tesla, which is China, and the company 0:05:15.200 --> 0:05:18.200 successfully built its factory in Shanghai. A couple of nights ago, 0:05:18.240 --> 0:05:20.240 we saw tweet from none other than Jeff Bezos, which 0:05:20.240 --> 0:05:22.279 I think surprised a lot of people because Jeff Bezos 0:05:22.279 --> 0:05:24.679 is pretty quiet when it comes to Twitter and this stuff. 0:05:25.040 --> 0:05:28.160 He uh implied that this could be perceived as a 0:05:28.200 --> 0:05:30.800 conflict of interest, as you right, when Musk's Twitter has 0:05:30.839 --> 0:05:34.560 to decide how to treat Chinese back to disinformation, how 0:05:34.680 --> 0:05:37.160 is this being played in Republican circles? When Republicans in 0:05:37.200 --> 0:05:39.600 the past have gone really hard after Disney for its 0:05:39.600 --> 0:05:43.039 presence in China, Nike, the NBA, and more, Musk has 0:05:43.040 --> 0:05:46.240 been pretty much teflon on this issue, despite um, you know, 0:05:46.320 --> 0:05:49.320 China critics having having plenty to criticize here. Um. I 0:05:49.360 --> 0:05:51.320 think for one thing, I think a couple of things 0:05:51.320 --> 0:05:54.279 going on. One is, look, he's a successful you know 0:05:54.320 --> 0:05:58.039 industrialist and and people like that. And and as a result, UM, 0:05:58.120 --> 0:06:01.680 people are more forgiving of some of these um, you know, 0:06:01.960 --> 0:06:06.440 connections or hypocrisies or potential vulnerabilities politically. UM. I also 0:06:06.680 --> 0:06:10.039 think that, you know, conservatives have been very eager to 0:06:10.120 --> 0:06:12.840 kind of embrace this like made in America thing. You know. Musk, 0:06:12.920 --> 0:06:16.119 despite having a huge factory in China, also employs, um 0:06:16.160 --> 0:06:17.800 you know, lots of people in the United States. So 0:06:17.800 --> 0:06:19.680 so I think it's it's it's a little bit complicated. 0:06:19.800 --> 0:06:21.400 I also want to say, you know, on the tweet 0:06:21.440 --> 0:06:24.160 from Bezos, of course he's got his own political agenda, right, 0:06:24.200 --> 0:06:27.239 He's competing with Musk also for government contracts. He owns 0:06:27.240 --> 0:06:30.400 this rocket company, so it's totally in his interest to 0:06:30.560 --> 0:06:34.400 kind of you know, slime you know, competitor on Twitter, um, 0:06:34.600 --> 0:06:36.760 you know, as part of that. And we should probably 0:06:36.760 --> 0:06:39.159 also say that that he sort of immediately backed off. 0:06:39.600 --> 0:06:42.240 That was Bloomberg Business Week features editor Max Chafkin and 0:06:42.279 --> 0:06:44.680 the editor of the magazine, Joe Weber, coming up from 0:06:44.680 --> 0:06:47.960 a technological innovator to a financial one. We dive into 0:06:48.000 --> 0:06:50.240 a new book on Wall Street Legend. We're talking about 0:06:50.240 --> 0:06:53.240 the late Great Jack Bogel, you're listening to Bloomberg Business Week. 0:06:53.440 --> 0:07:07.159 This is Bloomberg. This is Bloomberg Business Week with Carol 0:07:07.200 --> 0:07:11.440 Messer and Bloomberg Quick Takes. Tim Stinovik from Bloomberg Radio. 0:07:12.920 --> 0:07:15.360 I was never in this business to build a colossus, 0:07:15.800 --> 0:07:18.800 because I told people many times I was too stupid 0:07:18.840 --> 0:07:21.680 to realize that if we gave investors the best deal 0:07:21.720 --> 0:07:24.720 I would ever get, I'd be building a colossus. And 0:07:24.760 --> 0:07:29.280 so here we are on the way to market share 0:07:29.680 --> 0:07:33.160 of mutual fund assets, something that no one has ever 0:07:33.200 --> 0:07:37.000 achieved anything like before. There are legendary investors and financial 0:07:37.000 --> 0:07:39.920 innovators that, over the decades still stand out. Warren Buffett, 0:07:39.960 --> 0:07:42.840 of course, on value investing, fidelities, Peter Lynch amid the 0:07:42.920 --> 0:07:45.520 rise of the mutual fund industry. And then there's the 0:07:45.560 --> 0:07:49.160 man whose voice you just heard, the late Jack Bogel. 0:07:49.600 --> 0:07:53.080 That from a Bloomberg interview back in. Bogel's idea of 0:07:53.120 --> 0:07:55.800 index investing was not only well ahead of its time, 0:07:56.120 --> 0:07:59.120 it was considered radical when he introduced the strategy at 0:07:59.120 --> 0:08:02.040 his then f jeling Vanguard Investment Group back in the 0:08:02.120 --> 0:08:05.640 nineteen seventies. Hard to think of Vanguard's fledgeling, but back 0:08:05.640 --> 0:08:08.239 then it was different. Bogel's life and his lasting impact 0:08:08.240 --> 0:08:11.240 on investing and the financial industry are explored in a 0:08:11.280 --> 0:08:13.880 new book that's excerpted in the latest issue of Bloomberg 0:08:13.920 --> 0:08:17.600 Business Week. Bloomberg Intelligence Senior et F analyst Eric Beltunus 0:08:17.680 --> 0:08:20.160 is here to break down the Bogel Effect, how John 0:08:20.200 --> 0:08:23.720 Bogel and Vanguard turned Wall Street inside out and saved 0:08:23.760 --> 0:08:26.760 investors trillions, and why it took so long for the 0:08:26.800 --> 0:08:30.360 concept of indexing to catch on. This is why where 0:08:30.360 --> 0:08:32.600 I think the story has a little more drama than 0:08:32.640 --> 0:08:34.559 people think. You know, a lot of Wall Street books 0:08:34.559 --> 0:08:36.880 are about the rise in the fall, and let's Bogel. 0:08:36.920 --> 0:08:39.520 It's sort of like he just kept, you know, slowly rising. 0:08:39.960 --> 0:08:43.640 But this guy lived in oblivion for about five years. 0:08:44.000 --> 0:08:46.920 And the reason it took so long, given what people 0:08:47.000 --> 0:08:49.960 today think is an obvious trade, why not Why wouldn't 0:08:49.960 --> 0:08:52.560 I own the whole market? For three basis points is 0:08:52.600 --> 0:08:55.520 that he operated outside of the system. He just did 0:08:55.640 --> 0:08:58.920 the Vanguard refused to pay brokers, and at that time 0:08:58.960 --> 0:09:01.160 it just there were no r i as it was 0:09:01.280 --> 0:09:03.800 just brokers, and so if you did not give them 0:09:03.800 --> 0:09:07.280 money or loads or commissions or kickbacks. Um, they were 0:09:07.280 --> 0:09:09.440 not going to sell your funds, So he had to 0:09:09.440 --> 0:09:12.080 get people to leave that system. He also had to 0:09:12.120 --> 0:09:15.080 try to explain to people that an index fund was 0:09:15.120 --> 0:09:17.920 not average. It sounded average. He had a lot of 0:09:17.920 --> 0:09:19.880 people trying to position it that way, so he had 0:09:19.920 --> 0:09:21.960 to go above and beyond to try to explain, hey, 0:09:22.000 --> 0:09:24.959 this is not average. So those two things made it 0:09:25.000 --> 0:09:28.480 take a long time. Also, the barguard mutual ownership structure, 0:09:28.920 --> 0:09:32.240 which lowers fees the more assets it gets, took a 0:09:32.280 --> 0:09:36.120 while to lower fees because the assets weren't quite there yet. 0:09:36.200 --> 0:09:39.120 So as the assets started to come in the nineties 0:09:39.120 --> 0:09:41.160 and two thousand's, that's when the fees really started to 0:09:41.200 --> 0:09:44.520 dip down. And once they got below twenty fifteen basis points, 0:09:44.880 --> 0:09:46.840 it was a done deal. And that's part of the 0:09:46.840 --> 0:09:49.400 point of making the book. Also is the index fund 0:09:49.480 --> 0:09:52.200 was a kind of a lucky byproduct. The real core 0:09:52.360 --> 0:09:54.640 nucleus of all the things we're seeing today that we're 0:09:54.640 --> 0:09:58.640 from Bogel and Vanguard are the mutual ownership structure, UH 0:09:58.679 --> 0:10:00.880 and the structure of Bogel home self. I must say 0:10:00.920 --> 0:10:03.200 he was a different kind of guy, and so I 0:10:03.200 --> 0:10:05.440 think those two things really are what I explore the 0:10:05.480 --> 0:10:07.600 most in the book. I think I've I've talked with 0:10:07.640 --> 0:10:09.599 you about this before, but I remember one of my 0:10:09.640 --> 0:10:13.280 first shows that I did in financial television and financial broadcast, 0:10:13.320 --> 0:10:15.400 and it was a mutual fund show, and we would 0:10:15.400 --> 0:10:17.200 always be like, Okay, you gotta have a Vanguard fund 0:10:17.200 --> 0:10:20.240 on because it was a low cost, no cost option. 0:10:20.440 --> 0:10:22.440 And our host was like, why would you pay fees 0:10:22.480 --> 0:10:24.280 when you can go to Vanguard and get the same 0:10:24.320 --> 0:10:27.720 strategy and pay no fees. I mean, he really was 0:10:28.040 --> 0:10:31.719 iconic in terms of his impact on this industry. Yeah, absolutely, 0:10:31.760 --> 0:10:33.640 I mean, you know it is it is just a 0:10:33.679 --> 0:10:37.000 modern miracle that you can just get the whole stock market, 0:10:37.440 --> 0:10:40.840 the whole bond market, and at this point international stocks 0:10:41.520 --> 0:10:45.079 for under six seven basis points a six before you 0:10:45.120 --> 0:10:47.640 now can be gotten for three or four basis points, 0:10:47.640 --> 0:10:50.880 basically frictionalist exposure. And that's a big theme in the book. 0:10:51.240 --> 0:10:53.840 I had this well, is that I think, you know, 0:10:53.920 --> 0:10:57.120 Bogel's called the father of the index fund, but honestly 0:10:57.160 --> 0:10:58.840 feel like you should be called either the father of 0:10:58.880 --> 0:11:02.720 low cost investing or I like this phrase addition by subtraction. 0:11:03.320 --> 0:11:06.040 What he did over forty five years was just remove 0:11:06.120 --> 0:11:08.000 all the stuff that kind of gets in the way, 0:11:08.360 --> 0:11:13.480 be it management, fees, brokers, turnover, trading costs, human emotion. 0:11:13.920 --> 0:11:16.080 I mean, taking all that out and you get the 0:11:16.080 --> 0:11:19.480 total market with its almost frictionalist exposure. And that's why 0:11:19.480 --> 0:11:21.439 it's a smash it. And it's not just Vanguard, which 0:11:21.480 --> 0:11:23.880 takes in a billion a day. The rest of the 0:11:23.960 --> 0:11:28.720 money goes to Vanguard esque index funds, even from Fidelity, right, 0:11:28.800 --> 0:11:32.079 the fierce rival of Vanguard. That's how fidelities flows come now, 0:11:32.320 --> 0:11:35.120 just through those low costs inex funds. I mean he totally. 0:11:35.640 --> 0:11:39.360 The whole industry now basically is governed by Vanguard's mutual 0:11:39.360 --> 0:11:42.400 ownership structure, which nobody copied, but yet they have to 0:11:42.440 --> 0:11:44.560 copy it in a way. Eric, when I was reading this, 0:11:44.600 --> 0:11:45.959 I thought back to this article I read in The 0:11:46.000 --> 0:11:49.680 Atlantic about a year ago by Annie Lowry. It's entitled 0:11:49.720 --> 0:11:52.640 could index funds be quote worse than Marxism? And it's 0:11:52.640 --> 0:11:55.200 actually a quote from analyst at Bernstein. They're called passive 0:11:55.240 --> 0:11:58.320 investing worse than Marxism. I see you on the zoom 0:11:58.440 --> 0:12:01.160 laughing right now about this. What do you make of 0:12:01.160 --> 0:12:05.200 criticism of passive investing or index funds such as this. Yeah, 0:12:05.240 --> 0:12:07.920 and most of it's laughable, I mean the Marxism. Somebody 0:12:07.960 --> 0:12:10.720 else said that they're worse than the misuse of antibiotics. 0:12:10.800 --> 0:12:12.720 I mean they're I've heard, I've heard it compared to 0:12:12.720 --> 0:12:15.720 the Salem which trials people go crazy with this stuff. Look, 0:12:16.160 --> 0:12:19.400 if you think about it, all people have done is 0:12:19.440 --> 0:12:22.360 moved from closet indexing. If you look at the Fidelion Magellan, 0:12:22.440 --> 0:12:27.280 it largely owns Apple, Amazon, Google, right, and they've moved 0:12:27.280 --> 0:12:30.079 to actual indexing and saved about seventy basis points in 0:12:30.120 --> 0:12:33.360 the process. Everybody owned the same stocks, they just now 0:12:33.400 --> 0:12:37.000 own it in a different format. And indexing isn't really 0:12:37.040 --> 0:12:40.480 necessarily totally passive. Russell want thousand's different than the SMP. 0:12:40.800 --> 0:12:42.880 The SMP, by the way, is run by a human committee, 0:12:42.920 --> 0:12:46.320 has some rules. It's just more rules based active. So 0:12:46.559 --> 0:12:48.880 I try to get rid of that, that line between 0:12:48.920 --> 0:12:52.040 active and passive. What really is going on is low cost. 0:12:52.080 --> 0:12:54.120 And I promise in the book that let's say indexing 0:12:54.200 --> 0:12:57.680 wasn't a thing, and Vanguard had their mutual ownership structure 0:12:57.720 --> 0:13:00.840 and only active mutual funds. In my opinion, they would 0:13:00.840 --> 0:13:03.760 be the biggest active fund manager six times over because 0:13:03.760 --> 0:13:05.720 they would have been bringing a gun to a knife 0:13:05.720 --> 0:13:09.000 fight over and over. It's the low costs, that's the thing. 0:13:09.320 --> 0:13:11.400 And I don't think anybody who writes these articles would 0:13:11.440 --> 0:13:12.960 really have too much for a problem. The one thing 0:13:13.000 --> 0:13:15.800 we got to watch for is voting power. Vanguarded Blackrock 0:13:15.880 --> 0:13:18.240 now own about seven eight percent of all stocks, and 0:13:18.280 --> 0:13:20.280 so we have to wonder how are they going to 0:13:20.320 --> 0:13:22.880 make sure that they don't vote in a way that 0:13:23.000 --> 0:13:26.120 is different than their shareholders or misuse that power. So far, 0:13:26.240 --> 0:13:28.600 I think they're fine, but we have to watch that. 0:13:28.600 --> 0:13:31.040 That's probably the one thing I would think about watching. 0:13:31.280 --> 0:13:34.120 What about Bogel Deman, I'm surprised to hear about how 0:13:34.160 --> 0:13:38.560 spiritually was um just interesting? Yeah? Look, uh, I asked 0:13:38.559 --> 0:13:41.679 everybody interviewed this question, why is has nobody copered banguards 0:13:41.760 --> 0:13:43.800 much to ownership structure? They said, well, because people go 0:13:43.880 --> 0:13:45.240 to Wall Street to get rich. They don't want to 0:13:45.320 --> 0:13:47.640 drive a Volvo. And then the other question, I said, 0:13:47.679 --> 0:13:49.480 well then why did Bogel do it? And they're like, 0:13:49.600 --> 0:13:51.640 I don't know. Good questions. So a whole chapter is 0:13:51.640 --> 0:13:54.840 called Explaining Vogel, where I try to explain the ingredients 0:13:54.880 --> 0:13:58.200 that went in to create this very unusual person. I 0:13:58.320 --> 0:14:01.800 almost feel he was miscast uh in this industry, but 0:14:02.000 --> 0:14:06.120 maybe the industry needed a miscast in this era to 0:14:06.200 --> 0:14:09.120 sort of bring it to a more fiduciary place. So 0:14:09.160 --> 0:14:12.120 he was perfectly cast in away but definitely not your 0:14:12.160 --> 0:14:15.440 average Wall Street titan. And again I explore that in 0:14:15.440 --> 0:14:18.360 a whole chapter, uh to try to explain to you 0:14:18.400 --> 0:14:22.120 how he happened. That was Bloomberg Intelligence senior et F 0:14:22.160 --> 0:14:24.720 analyst Eric Bolchune is his new book. It's out. It's 0:14:24.720 --> 0:14:27.320 called The Bogel Effect. How John Bogel and Vanguard turned 0:14:27.320 --> 0:14:30.440 to Wall Street inside out and saved investors trillions. It's 0:14:30.440 --> 0:14:33.080 out now still ahead on Bloomberg Business Week, Why a 0:14:33.120 --> 0:14:36.720 successful retail executive chose to speak out against a series 0:14:36.760 --> 0:14:39.400 of COVID related health policies and how it ended up 0:14:39.400 --> 0:14:41.640 costing her a lucrative role in the c suite of 0:14:41.640 --> 0:14:51.680 a six billion dollar company. This is Bloomberg broadcasting from 0:14:51.720 --> 0:14:55.440 the financial capital of the world, Bloomberg eleven Frio in 0:14:55.560 --> 0:14:59.960 New York to Washington, d C. Bloomberg to Boston, Bloomberg 0:15:00.120 --> 0:15:03.240 one O six one does San Francisco, Bloomberg nine sixty 0:15:03.400 --> 0:15:06.640 to the country, Sirius XM jendal one nineteen and around 0:15:06.640 --> 0:15:10.720 the globe the Bloomberg Business app and Bloomberg Radio dot com. 0:15:10.800 --> 0:15:15.360 This is Bloomberg Business Week. Well before she quit in February, 0:15:15.480 --> 0:15:18.400 Jennifer Say was a brand president at Levi. She had 0:15:18.520 --> 0:15:21.080 risen to the rank of chief marketing Officer after more 0:15:21.080 --> 0:15:23.400 than two decades with the Danna maker, and she was 0:15:23.440 --> 0:15:26.800 seen as a potential CEO candidate. Then along came COVID 0:15:26.880 --> 0:15:30.640 nineteen with more. We turned to Bloomberg Business Week senior 0:15:30.680 --> 0:15:33.680 writer Claire Suteth Claire, good to have you with us, 0:15:33.800 --> 0:15:36.240 A really great profile of somebody who I think wasn't 0:15:36.240 --> 0:15:40.400 a household name until she made such a big splash 0:15:40.640 --> 0:15:45.760 leaving Levi's what happened to Jennifer Say, Yeah, well, you're right. 0:15:46.160 --> 0:15:48.280 So Jennifer Say was not a hostle name, but she 0:15:48.480 --> 0:15:50.760 was very high up that le. She'd been at the 0:15:50.800 --> 0:15:56.280 company since, worked her way up to chief marketing Officer, 0:15:56.320 --> 0:15:58.520 which is what she held at the start of the pandemic, 0:15:58.720 --> 0:16:01.400 and then during the pandemic she was actually promoted to 0:16:01.600 --> 0:16:04.600 it's called brand president, which took her basically right below 0:16:04.640 --> 0:16:08.880 the CEO in line to maybe one day become CEO UM. 0:16:08.960 --> 0:16:12.160 And so she's sort of the person that Levi's who 0:16:12.280 --> 0:16:17.120 has for years been crafting the brand image reputation. So 0:16:17.160 --> 0:16:19.560 whatever you think of what do you think of Levi Jeans, 0:16:19.720 --> 0:16:23.400 Levi Jeens, that's what she does for a living. UM. 0:16:23.520 --> 0:16:27.880 Some of that was, you know, inserting Levi's into the culture, 0:16:27.880 --> 0:16:30.680 holding parties at Clichella, that sort of stuffs to make 0:16:30.720 --> 0:16:34.080 it cool, and another part of it was really helping 0:16:34.600 --> 0:16:36.960 be you know, she's part of the executive team that 0:16:37.120 --> 0:16:42.040 crafted Levi's response to social issues. This company was very 0:16:42.080 --> 0:16:45.160 progressive for a very long time, actually, dating all the 0:16:45.160 --> 0:16:48.720 way back to I think in like n it was 0:16:48.760 --> 0:16:51.320 the first company to make genes for women, back when 0:16:51.320 --> 0:16:54.480 women really weren't supposed to even wear pants in public 0:16:55.400 --> 0:17:01.680 right now different you would not UM. It racially integrated 0:17:01.680 --> 0:17:04.239 its factories in the forties, like long before there were 0:17:04.240 --> 0:17:07.879 anyone's requiring it UM. And then it was actually the 0:17:07.880 --> 0:17:12.680 first Fortune hundred company that extended benefits to employees name 0:17:12.720 --> 0:17:16.320 sex partners. UM. So it has this really long history 0:17:16.359 --> 0:17:19.840 and legacy of these progressive chances UM in the past, 0:17:19.880 --> 0:17:21.919 I would say, like decade or so, it became a 0:17:21.960 --> 0:17:25.000 bit more public about them. It has you know, come 0:17:25.000 --> 0:17:29.720 out in favor of marriage equality, transgender right. Um, it's 0:17:30.440 --> 0:17:34.720 very publicly UM sort of promoting UM, you know, fun 0:17:34.760 --> 0:17:38.800 control for the parks and school shooting and and say 0:17:38.840 --> 0:17:41.520 it was actually part of the team that came up 0:17:41.520 --> 0:17:46.160 with all of this, um, and then came the pandemic. So, 0:17:46.160 --> 0:17:48.600 so tell us what happened, because right it sounds like 0:17:49.000 --> 0:17:52.080 every company has a line in the sand when it 0:17:52.119 --> 0:17:55.679 comes to what they're willing to talk about publicly, especially 0:17:55.680 --> 0:17:58.719 when it's UM some some major issues, and you know, 0:17:58.800 --> 0:18:01.480 some things are comfortable. It's some things they're not. What 0:18:01.640 --> 0:18:04.000 happened and it wasn't just her, it was her and 0:18:04.040 --> 0:18:08.359 also her husband. Yeah, so you know, I think Levy's 0:18:08.720 --> 0:18:12.440 you know, this is a really thorny issue. UM. And 0:18:12.600 --> 0:18:14.280 it's you know, this has been a two year long 0:18:14.320 --> 0:18:17.720 internal struggle between Advised that only became public when she 0:18:17.840 --> 0:18:20.520 quit in a very dramatic fashion and gave a bunch 0:18:20.520 --> 0:18:24.080 of television interviews about it. UM. But basically what happened 0:18:24.119 --> 0:18:27.600 is during the pandemic, UM to say and her husband 0:18:28.040 --> 0:18:31.240 living at the time, they lived in San Francisco UM, 0:18:31.400 --> 0:18:35.919 and she became I would say, very upset about a 0:18:36.040 --> 0:18:39.920 number of different UM safety precautions that was put in place, 0:18:39.960 --> 0:18:42.760 both at the sort of San Francisco city level, California 0:18:42.840 --> 0:18:45.399 level UM and and just what was happening at the 0:18:45.440 --> 0:18:50.440 country at large. So we're talking about lockdowns masks her. 0:18:51.160 --> 0:18:53.760 The topic that she talked about most frequently and was 0:18:53.760 --> 0:18:57.280 the most passionate about was UM school reopening, getting kids 0:18:57.320 --> 0:19:01.800 back in the classroom UM. And I think now in hindsight, 0:19:02.400 --> 0:19:07.040 nearly everyone recognizes that schools were shut down consists considerably, like, 0:19:07.119 --> 0:19:09.680 you know, way too long in certain parts of the country. 0:19:09.960 --> 0:19:13.880 There were many European countries that opened quite early. UM. 0:19:14.000 --> 0:19:18.080 She was advocating for this in like March, when no 0:19:18.119 --> 0:19:20.080 one knew what was going on in the depth of 0:19:20.119 --> 0:19:22.040 the pandemic. This is a great week. And I have 0:19:22.080 --> 0:19:23.879 to say, once I started reading the story, I couldn't 0:19:23.920 --> 0:19:25.879 put it down. We we've run out of time, so 0:19:26.160 --> 0:19:30.200 we're gonna recommend everybody check out the story online. But Claire, 0:19:30.280 --> 0:19:33.320 it's like, it's incredible how it plays out. And I 0:19:33.359 --> 0:19:36.480 feel like this gets to where a lot in your 0:19:36.480 --> 0:19:39.159 story about you know, when a company can deploy its 0:19:39.160 --> 0:19:41.960 political muscle really hard to get it right. We're seeing 0:19:41.960 --> 0:19:43.960 a play out with Disney and some other companies. Tim 0:19:44.040 --> 0:19:47.320 it also goes through says political transformation. I mean, this 0:19:47.359 --> 0:19:50.240 is a woman who had posters of Obama hanging in 0:19:50.280 --> 0:19:53.200 her dining room and supported the candidacy of Elizabeth Warren, 0:19:53.240 --> 0:19:56.679 wasn't a fan of Trump, and now she's on Fox News. Yeah, 0:19:57.040 --> 0:19:59.280 it's it's an incredible story, Claire, and you really get 0:19:59.320 --> 0:20:01.080 into all the d tale. So as we said, we 0:20:01.119 --> 0:20:04.200 highly recommend people check it out in the magazine online 0:20:04.560 --> 0:20:06.760 or on the Bloomberg terminal. That was Bloomberg Business Week, 0:20:06.840 --> 0:20:09.720 Senior writer Claire Suddeth, you're listening to Bloomberg Business Week. 0:20:09.800 --> 0:20:13.159 Up next, another quarter, another earnings beat for the toymaker Mattel. 0:20:13.600 --> 0:20:15.920 But that's not the only reason the stock got to 0:20:15.960 --> 0:20:18.320 bump this past week. That's right up next, we're going 0:20:18.400 --> 0:20:21.320 to be hearing from CEO Inn Cries about reports of 0:20:21.320 --> 0:20:34.200 a possible private equity buyout. This is Bloomberg. You're listening 0:20:34.240 --> 0:20:38.320 to Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes. 0:20:38.400 --> 0:20:43.560 Tim Stinovy from Bloomberg Radio. But Tell America's second largest 0:20:43.560 --> 0:20:46.639 toymaker is in preliminary buyout talks with at least two 0:20:46.680 --> 0:20:49.120 private equity First, we got that news this week. Yeah, 0:20:49.160 --> 0:20:51.400 that news emerging ahead of the company reporting first quarter 0:20:51.440 --> 0:20:54.720 results that beat Wall Street estimates once again, the retailer 0:20:54.760 --> 0:20:57.720 buoyed by Barbie and hot Wheel cells that defied the 0:20:57.800 --> 0:21:00.399 usual seasonal slowdown. All right, to break down the firm's 0:21:00.480 --> 0:21:03.000 latest results and find out more about that potential for 0:21:03.040 --> 0:21:05.919 a multibillion dollar sale, we caught up once again with 0:21:05.960 --> 0:21:09.639 Mattel's chairman and CEO in non cries. This was the 0:21:09.720 --> 0:21:14.600 highest first quarter we have on record, both revenue and profitability. 0:21:15.119 --> 0:21:18.639 Our momentum continued across the business with double digit growth 0:21:18.640 --> 0:21:22.080 in Bobbie, Hotwoods and Fisher Price. We have started the 0:21:22.119 --> 0:21:26.359 second quarter with strong consumer demand. The Follier outlook is 0:21:26.400 --> 0:21:29.920 also strong and we expect to grow market here. So 0:21:30.400 --> 0:21:33.280 all in all, an excellent start of the year and 0:21:33.320 --> 0:21:37.439 we're firmly in growth mode. And I think we highlighted yesterday. 0:21:37.600 --> 0:21:40.720 I mean, you guys have been on a tear if 0:21:40.720 --> 0:21:42.560 I look at you know, the share price in terms 0:21:42.560 --> 0:21:45.840 of the moves that you guys have been doing specifically, Um, 0:21:45.880 --> 0:21:47.800 some would say and I'm going to push a little 0:21:47.800 --> 0:21:51.400 bit that you're setting it up for a sale. Are 0:21:51.440 --> 0:21:55.359 you talking with people? Are there conversations going on? But 0:21:55.480 --> 0:21:59.000 I can't comment on the speculation. But we've been consistently 0:21:59.080 --> 0:22:02.320 growing the company, UH, and this has happened over the 0:22:02.400 --> 0:22:05.479 last four years. You followed the story, so you know 0:22:05.680 --> 0:22:09.040 that we took our adjusted IBIDA from a hundred six 0:22:09.080 --> 0:22:12.640 million dollars in two thousand and seventeen two over a billion, 0:22:14.280 --> 0:22:17.480 and guided for yet another growth this year with higher 0:22:17.520 --> 0:22:22.040 goals for three So this is not a one quarter situation. 0:22:22.160 --> 0:22:25.720 This has been consistent delivery and execution on a on 0:22:25.800 --> 0:22:29.520 a clear strategy and a clear roadmap with Tracking Whale, 0:22:29.920 --> 0:22:32.520 and we are in a great position to continue to 0:22:32.520 --> 0:22:34.520 grow the company. And I will point out that from 0:22:34.560 --> 0:22:39.280 the end of the stock is up almost so investors 0:22:39.280 --> 0:22:43.000 have certainly noticed that performance in those changes. On one 0:22:43.240 --> 0:22:46.119 element that you've had to UH deal with just not 0:22:46.160 --> 0:22:48.160 just over the last year, but over the last few quarters, 0:22:48.200 --> 0:22:51.520 to our inflationary prefer pressures on the supply chain. We've 0:22:51.560 --> 0:22:54.800 spoken to you in the company in past quarters about 0:22:54.840 --> 0:22:57.320 moves that you've made to try to make sure that 0:22:57.560 --> 0:23:00.560 your supply chain remains intact what you've being do ahead 0:23:00.560 --> 0:23:02.399 of time, but it doesn't mean you've been immune to 0:23:02.480 --> 0:23:04.919 higher prices. Talk to us about the pricing power that 0:23:04.960 --> 0:23:07.320 you've had and how much you've had to raise prices 0:23:07.359 --> 0:23:10.439 and how consumers are being affected by that. Yeah, we 0:23:10.640 --> 0:23:15.959 you know, given the anticipated inflation, implementing pricing action UM 0:23:16.200 --> 0:23:18.960 is one of the things we consider at times of 0:23:18.960 --> 0:23:22.520 of of inflationary pressures. Uh. We're not the only ones, 0:23:22.560 --> 0:23:25.199 and it's not unique to the toy industry. Uh. And 0:23:25.280 --> 0:23:28.359 this is something that we've done, like in the second 0:23:28.400 --> 0:23:30.800 half of last year, and we expect to do that 0:23:30.840 --> 0:23:34.840 again uh in the second half of this year. It's 0:23:34.880 --> 0:23:39.320 important to say that when raising prices, we always keep 0:23:39.520 --> 0:23:42.879 the consumer in mind, and we're being very thoughtful and 0:23:43.000 --> 0:23:46.960 very strategic and remain strategic committed to maintaining the right 0:23:47.040 --> 0:23:52.119 balance between quality and value for our consumers. Well, you 0:23:52.119 --> 0:23:53.879 know what's really great is I mean, you guys have 0:23:53.960 --> 0:23:56.600 some old iconic brands. We've talked about it with you before, 0:23:56.720 --> 0:23:59.800 whether it's Barbie, whether it's Hot Wheels. I mean, it's 0:23:59.840 --> 0:24:02.600 just one brand after another. But then you have folded 0:24:02.600 --> 0:24:04.960 into the mix and embrace of all that is new 0:24:05.160 --> 0:24:08.640 through alliances and partnerships. What is it that really drives 0:24:08.680 --> 0:24:11.280 growth for you guys, What is it that you say, Okay, 0:24:11.320 --> 0:24:14.720 this is top of mind, you know. In terms of 0:24:14.760 --> 0:24:18.080 the performance for the company overall, well, we've been growing 0:24:18.080 --> 0:24:20.880 on the toy side of the company very strongly. We 0:24:21.040 --> 0:24:23.919 expect further growth this year. We expect growth in the 0:24:23.920 --> 0:24:27.360 second quarter and growth for the full year. We expect 0:24:27.400 --> 0:24:30.840 our power brands to continue to grow this year, Barbie, 0:24:31.040 --> 0:24:34.320 Hotwells and Fisher Price, as well as American Girl, and 0:24:34.359 --> 0:24:37.919 we expect to see strong growth in the challenging categories. 0:24:37.960 --> 0:24:40.359 This is where we're not a global leader, but we're 0:24:40.400 --> 0:24:45.000 seeing tremendous momentum and growth in categories like action figures 0:24:45.040 --> 0:24:48.520 and building sets. So we are in a great position 0:24:48.520 --> 0:24:51.080 to grow in the toy side of the company. And 0:24:51.119 --> 0:24:54.199 in addition to that, we're also seeing great momentum on 0:24:54.320 --> 0:24:59.680 the I P strategy. This is film, television content in general, 0:25:00.240 --> 0:25:04.440 consumer products, digital experiences. And this week alone, we had 0:25:04.440 --> 0:25:07.840 two very exciting news to share. One is that we 0:25:08.040 --> 0:25:10.960 partnered with J. J Abrams to produce the Hot Wheels 0:25:11.040 --> 0:25:14.879 movie that we're developing with Warner Brothers. JJ is one 0:25:14.920 --> 0:25:20.040 of the most prolific, respected producers of this generation filmmakers 0:25:20.040 --> 0:25:23.280 in general, is also a director and we're very excited 0:25:23.320 --> 0:25:26.000 to have him partnered with us on Hot Wheels. And 0:25:26.040 --> 0:25:30.120 in addition, we also announced or Warner Brothers announced at 0:25:30.200 --> 0:25:34.320 CinemaCon the release date of The Barbie Movie, which will 0:25:34.359 --> 0:25:41.240 be July one, three, And this film is shaping up 0:25:41.480 --> 0:25:46.080 really well to be an iconic cultural event. We could 0:25:46.080 --> 0:25:49.879 not be more excited with the creative, execution and vision 0:25:50.800 --> 0:25:53.440 of Great Gelwig, who is also one of the most 0:25:53.520 --> 0:25:58.160 respected and prolific creative filmmakers of this generation. And an 0:25:58.160 --> 0:26:04.160 all star cast with Margot Robbie, Ryan Gosling, Will Farrell Simulo, 0:26:04.960 --> 0:26:09.600 America Ferra and many other you know, very strong talent 0:26:09.720 --> 0:26:14.480 and exciting cast. So expect something very special, uh from 0:26:14.840 --> 0:26:17.160 the Barbie Movie as well as Hot Wheels, and as 0:26:17.160 --> 0:26:20.720 well as other twelve films that we have in development, 0:26:20.800 --> 0:26:21.960 you know. And I want to go back to something 0:26:22.000 --> 0:26:25.800 that you said about challenger categories areas where you're not 0:26:25.920 --> 0:26:30.080 actually the top of the category. Um, do you think 0:26:30.119 --> 0:26:33.080 you can become the leader of the pack in those categories? 0:26:33.560 --> 0:26:36.359 In action figures, for example? What will it take? We 0:26:36.359 --> 0:26:39.080 we're seeing tremendous growth and momentum. In the first quarter, 0:26:39.119 --> 0:26:43.239 we grew by fort in the core and this is 0:26:43.640 --> 0:26:46.200 on top of six six percent in the same quarter 0:26:46.320 --> 0:26:49.800 last year, so we're lapping a very strong year with 0:26:49.960 --> 0:26:54.800 forty in in the first quarter. Within that action figures 0:26:54.920 --> 0:27:00.919 actually grew by sev so uh shoes momentum even by 0:27:01.040 --> 0:27:04.160 our own properties such as Masters of the Universe, as 0:27:04.160 --> 0:27:08.000 well as third party franchises that we manage on the 0:27:08.040 --> 0:27:12.920 toy sides such as Jurassic World, Minions and Light Year three, 0:27:13.119 --> 0:27:16.040 big theatrical releases that are coming up in the second 0:27:16.119 --> 0:27:21.879 quarter and will further amplify growth in this category in 0:27:21.920 --> 0:27:25.119 addition to what we do already. So this is an 0:27:25.160 --> 0:27:29.160 area where we see an opportunity to position Mattel as 0:27:29.200 --> 0:27:33.600 a partner of choice for the major entertainment companies and 0:27:33.720 --> 0:27:38.640 owners of big important franchises to leverage our platform, our 0:27:38.680 --> 0:27:43.720 capabilities on the design side, supply and supply chain, and 0:27:43.880 --> 0:27:48.280 commercial execution and really grow these franchises and manage them 0:27:48.400 --> 0:27:51.560 as evergreen properties that are not just dependent on the 0:27:51.560 --> 0:27:54.000 movie launch. But this is where we can bring out 0:27:54.040 --> 0:27:59.879 capabilities and manage franchises as evergreen I P. And continue 0:28:00.200 --> 0:28:02.480 great value for our partners. Well, you know, I think 0:28:02.480 --> 0:28:05.080 about what you said about IP strategy film TV. You 0:28:05.119 --> 0:28:07.040 guys are already do with the Barbie movie. You're gonna 0:28:07.040 --> 0:28:09.359 do it, as you said, with Hot Wheels, And I 0:28:09.400 --> 0:28:13.000 do think about, um, what's the best way for you 0:28:13.040 --> 0:28:16.439 to leverage all of that? Is it by doing it 0:28:16.480 --> 0:28:19.600 as a standalone and just partnering and you know, creating 0:28:19.640 --> 0:28:23.439 alliances with media and entertainment companies, or is there some 0:28:23.560 --> 0:28:25.879 kind of you know, going back to our first question, 0:28:25.960 --> 0:28:28.840 some kind of more significant link up with a specific 0:28:28.920 --> 0:28:32.320 media house Disney for the matter, you know, that would 0:28:32.320 --> 0:28:36.880 make sense and really create some incredible leverage. Our approach 0:28:36.920 --> 0:28:41.120 has been capitalized in that we don't take capital risk 0:28:41.280 --> 0:28:45.560 in investing in movies um, and that capitale approach applies 0:28:45.600 --> 0:28:49.880 also to our manufacturing strategy. What we do do on 0:28:49.920 --> 0:28:53.640 the content side is with partner with the best the 0:28:53.680 --> 0:28:56.920 best in their respective field. So we're partnered with the 0:28:56.960 --> 0:29:01.400 best distributor as a major studio and the best creative 0:29:01.440 --> 0:29:05.800 talent per genre, per project. And that gives us the 0:29:05.840 --> 0:29:11.320 ability to do that at scale and develop multiple projects 0:29:11.680 --> 0:29:14.640 at the same time and not be limited to UH 0:29:15.280 --> 0:29:18.600 one or two movie movies coming out every one or 0:29:18.600 --> 0:29:21.080 two or three years. So we can do it at scale, 0:29:21.520 --> 0:29:25.240 work with the best people, per genre, per opportunity across 0:29:25.320 --> 0:29:30.080 across the industry, and have multiple shots on goal with 0:29:30.160 --> 0:29:34.760 incredible brands and incredible incredible franchises and still find the 0:29:34.880 --> 0:29:38.720 right economic balance in terms of risk and reward for matail. 0:29:39.320 --> 0:29:43.680 Where our currency, our contribution is the I P the 0:29:43.720 --> 0:29:47.360 franchises that we know, our expertise and know how of 0:29:47.440 --> 0:29:51.040 those of those franchises, and making sure that we collaborate 0:29:51.280 --> 0:29:54.840 and and and bring our understanding and the nuance knowledge 0:29:55.120 --> 0:29:58.360 of these franchises to the table and create something very 0:29:58.360 --> 0:30:01.600 excited for exciting for insumers all over the world. All right, 0:30:01.720 --> 0:30:04.320 you know, and I'm I'm a little persistent, as you 0:30:04.400 --> 0:30:07.360 might know, having re talked a few times. So go, 0:30:07.720 --> 0:30:11.360 So you are firing at all cylinders. Mattel is firing 0:30:11.360 --> 0:30:13.400 at all cylinders. And you guys have had what three 0:30:13.440 --> 0:30:17.959 consecutive years of dynamic certainly equity growth. Uh And like 0:30:18.000 --> 0:30:21.520 I said, investors are noticing. So some would say that 0:30:21.720 --> 0:30:24.840 is a reason the top perhaps or at a prime 0:30:24.880 --> 0:30:28.960 moment to sell the company. Others would say it's you know, 0:30:29.040 --> 0:30:31.680 you are talking about more avenues for growth. What would 0:30:31.680 --> 0:30:34.000 it take to do a deal that makes sense? Obviously 0:30:34.000 --> 0:30:36.480 shareholders of the board have to agree. But you know, 0:30:36.800 --> 0:30:40.440 is it just about price or is it about strategy. Well, 0:30:40.480 --> 0:30:44.280 we're here to create shareholder value. We've been very consistent 0:30:44.640 --> 0:30:49.800 about executing our strategy and always have our shareholders interests 0:30:50.480 --> 0:30:53.400 as a north star. We have been doing it consistently. 0:30:53.440 --> 0:30:55.640 We see a lot of runway for the company to 0:30:55.720 --> 0:30:59.520 continue to grow and to create more shareholder value. That's 0:30:59.520 --> 0:31:02.840 our job, that's how focus, that's what we've been doing, 0:31:03.120 --> 0:31:05.760 and this is what we are looking to do going forward. 0:31:06.320 --> 0:31:09.320 That's a non christ chairman and CEO of Mattel. And 0:31:09.360 --> 0:31:11.320 that wraps up our first hour of the weekend edition 0:31:11.320 --> 0:31:14.160 of Bloomberg Business Week from Bloomberg Radio. I'm Carol Masser 0:31:14.320 --> 0:31:16.760 and I'm Stovik. Ahead in our next hour, our cover 0:31:16.920 --> 0:31:19.640 story on how China's campaign to wipe out COVID is 0:31:19.720 --> 0:31:23.200 crushing its economy, plus the chief technology officer of Chipotle 0:31:23.480 --> 0:31:27.240 on strong earnings amid rising costs, and then our pursuits 0:31:27.280 --> 0:31:29.480 team reveals the secrets behind some of the world's most 0:31:29.480 --> 0:31:33.200 expensive wedding bashes. We're talking millions and millions of dollars, 0:31:33.480 --> 0:31:45.000 tens of millions dollars. This is Bloomberg. This is Bloomberg 0:31:45.160 --> 0:31:48.720 Business Week inside from the reporters and editors who bring 0:31:48.760 --> 0:31:53.080 you America's most trusted business magazine, plus global business, finance 0:31:53.160 --> 0:31:56.600 and tech news as it happens. Bloomberg Business Week with 0:31:56.680 --> 0:32:01.280 Carol Messer and Bloomberg Quick Takes, Tim Stinovic on Bloomberg Radio. 0:32:02.280 --> 0:32:04.280 Plenty ahead in our second hour of the weekend edition 0:32:04.280 --> 0:32:08.120 of Bloomberg Business Week, including Chipotle's chief technology officer on 0:32:08.320 --> 0:32:11.040 the company's response to inflation, plus how to spend it 0:32:11.120 --> 0:32:14.640 twenty five million bucks in one weekend. It's actually not 0:32:14.720 --> 0:32:16.920 as hard as you think. That's, of course, if you 0:32:16.960 --> 0:32:18.720 have the right wedding planner and if you have the 0:32:19.240 --> 0:32:22.520 million alright. First up this hour, this week's cover story 0:32:22.840 --> 0:32:25.600 the rising cost of China's COVID zero policy, and the 0:32:25.760 --> 0:32:28.920 entire economics section of the magazine breaking down the ripple 0:32:28.960 --> 0:32:33.200 effects and also questioning credibility of the country's coronavirus statistics. 0:32:33.240 --> 0:32:37.200 Bloomberg Business Week Economics editor Christina Lynn Blad overseeing the coverage. 0:32:37.320 --> 0:32:39.760 She and Business Week editor Joel Webber help with the 0:32:39.800 --> 0:32:43.560 damage to China's economy and its people into perspective, Joel, 0:32:43.560 --> 0:32:46.320 I want to start with you, uh, take us into 0:32:46.720 --> 0:32:49.120 sort of the idea for the cover here and why 0:32:49.600 --> 0:32:53.040 you wanted to make China and its response to COVID 0:32:53.320 --> 0:32:56.920 more than two years into the crisis. The focus well 0:32:57.040 --> 0:33:02.120 China throughout the pandemic has to a COVID zero policy 0:33:02.160 --> 0:33:07.440 where borders are closed and whenever there is a uh, 0:33:07.480 --> 0:33:10.680 you know, an uptick in cases, they meet that with 0:33:11.000 --> 0:33:14.760 a lockdown. That has basically not had to happen for 0:33:14.840 --> 0:33:18.080 two years since Wuhan in the early days of the pandemic, 0:33:18.680 --> 0:33:21.640 but we've seen within the last couple of months o 0:33:21.840 --> 0:33:25.280 macron driven cases have started to surge throughout the country. 0:33:25.880 --> 0:33:28.760 Really this came to a head in Shanghai, where all 0:33:28.840 --> 0:33:31.760 of a sudden the whole city was basically brought to 0:33:31.840 --> 0:33:36.360 its knees uh. And what China has done since then 0:33:36.600 --> 0:33:41.000 is basically become even more more proactive and shutting down 0:33:41.520 --> 0:33:45.720 cities and regions whenever cases start to tick up, and 0:33:46.000 --> 0:33:49.800 that will have profound impacts on the global economy um 0:33:49.880 --> 0:33:52.640 in addition to to China. And that's when we started 0:33:52.640 --> 0:33:56.240 to see this unfold and talk to our colleagues in Shanghai. 0:33:56.280 --> 0:33:59.040 We realized that this is a much bigger story with 0:33:59.200 --> 0:34:03.000 way bigger globe implications than than anything that we've really 0:34:03.000 --> 0:34:06.160 seen in the China conversation over the last two years. 0:34:06.160 --> 0:34:08.279 And that's when Christina's pulled all this up and we 0:34:08.320 --> 0:34:12.040 started running with a bunch of stories. And Christina, you 0:34:12.040 --> 0:34:15.720 know what stuck out to you as we started spooling 0:34:15.760 --> 0:34:18.480 up this coverage, um and and trying to kind of 0:34:18.520 --> 0:34:20.560 like wrap it all together. What were the elements that 0:34:20.600 --> 0:34:22.640 you wanted to really focus on. Well, for me, a 0:34:22.680 --> 0:34:24.799 lot of it was the contrast of the fact that 0:34:25.280 --> 0:34:28.400 when we were all stuck working from home waiting for 0:34:28.520 --> 0:34:33.840 vaccines to arrive, Chinese people, because they had been so um, 0:34:33.880 --> 0:34:36.480 you know, committed to stamping out the virus in the 0:34:36.520 --> 0:34:39.480 initial phase, We're going to the movies, we're going to restaurants. 0:34:39.600 --> 0:34:43.560 Life had returned to normal in China in you know, 0:34:43.600 --> 0:34:47.239 by the by the end of the beginning. And then 0:34:47.280 --> 0:34:49.040 when I was looking now, I was saying, my god, 0:34:49.120 --> 0:34:52.399 it's this country is going through now what we all 0:34:52.440 --> 0:34:56.200 already went through, because um it is committed to not 0:34:57.040 --> 0:35:00.640 transitioning to a living with the virus phase because it can't, 0:35:00.680 --> 0:35:05.640 partly because it has less effective vaccines that you know. 0:35:06.160 --> 0:35:07.920 I mean, I think a lot of the world is 0:35:07.960 --> 0:35:11.040 sort of looking at China and can't understand the commitment 0:35:11.080 --> 0:35:12.960 to this policy. But I think we have to acknowledge 0:35:13.040 --> 0:35:16.680 the fact that the human cost would be really, really 0:35:16.760 --> 0:35:20.480 large to try and to do a quick transition. And 0:35:21.440 --> 0:35:24.600 one of the reasons is that China um has six 0:35:25.000 --> 0:35:27.520 m R and A vaccines in development, but not a 0:35:27.560 --> 0:35:30.359 single one will reach the market this year, and they 0:35:30.360 --> 0:35:34.239 are committed to not allowing foreign made ones UH to 0:35:34.760 --> 0:35:38.160 you know, use commercially. So that when you think about that, 0:35:38.200 --> 0:35:42.200 this this staggering human cost that that China would face 0:35:42.239 --> 0:35:44.600 if it if it did sort of open up and 0:35:44.840 --> 0:35:48.480 start to live with the virus, it really reveals what 0:35:48.600 --> 0:35:52.680 a conundrum President g has there. And keep in mind 0:35:52.719 --> 0:35:56.719 this is a Congress year. There there will be a 0:35:56.800 --> 0:35:59.799 big gathering later in the year, and when we talk 0:35:59.880 --> 0:36:02.680 to our colleagues that it is all about stability, so 0:36:02.760 --> 0:36:05.640 there will be no change of policy. They have to 0:36:05.640 --> 0:36:07.920 stay the course because to do anything other than that 0:36:07.920 --> 0:36:11.040 would to look like you made their own call. That's right. 0:36:11.120 --> 0:36:14.319 The political imperative is sticking with the policy. This is 0:36:14.320 --> 0:36:16.960 all playing out on social media in a really fascinating 0:36:17.000 --> 0:36:21.080 way in China right now. Traditionally social media has been 0:36:21.080 --> 0:36:24.320 censored in the country, and a lot of that censorship 0:36:24.360 --> 0:36:28.520 has actually come from the companies themselves. What's happening right 0:36:28.520 --> 0:36:31.120 now in social media in terms of uh, this the 0:36:31.760 --> 0:36:35.520 people of China pushing back against the government narratives. Well, 0:36:35.560 --> 0:36:39.400 there's been this huge outpouring of resentment um about the 0:36:39.440 --> 0:36:41.960 way the policy is being enforced. And also the fact 0:36:42.000 --> 0:36:46.719 that unlike most Western countries, China has not um done 0:36:46.760 --> 0:36:51.800 stimulus to households, only to businesses so um. And also 0:36:51.800 --> 0:36:55.360 people are getting much more creative about avoiding sensors, human 0:36:55.400 --> 0:36:59.359 sensors and censorships software. So one of the things we've seen, 0:36:59.400 --> 0:37:02.879 for example, is that these government hashtags that are used 0:37:02.920 --> 0:37:06.640 to sort of you know, make pronouncements, well people are 0:37:06.800 --> 0:37:11.520 hijacking them and actually using them to to sound off, 0:37:12.000 --> 0:37:15.640 you know, on government policies and have sometimes like ironic 0:37:15.719 --> 0:37:19.000 messages like oh, it would be so terrible to live 0:37:19.000 --> 0:37:22.120 in the United States, you know, and people know when 0:37:22.120 --> 0:37:25.360 people are saying things like that, what they mean. Another 0:37:25.440 --> 0:37:28.040 thing that we saw recently, which is really interesting was 0:37:28.239 --> 0:37:31.240 there was a six minute video that somebody made about 0:37:31.320 --> 0:37:34.760 life in Shanghai during the lockdown. They just pieced together 0:37:34.800 --> 0:37:39.080 all these sort of it's very moving um and UM 0:37:39.600 --> 0:37:42.560 and the sensors UM were quick to to find it 0:37:42.600 --> 0:37:46.080 and take it down. But people did things like they 0:37:46.120 --> 0:37:50.360 loaded it back upside down, They loaded up mirrored versions 0:37:50.400 --> 0:37:53.560 of the video that because the software wasn't picking up 0:37:53.600 --> 0:37:57.480 that this was the same clip, you know, and uh. 0:37:57.560 --> 0:37:59.600 And by the end of that same day they were like, 0:38:00.000 --> 0:38:02.319 ow many more versions of that video we're in on 0:38:02.360 --> 0:38:05.480 the internet. You know. Well, it's an incredible package of coverage, 0:38:05.480 --> 0:38:08.880 including looking at Shanghai and ex pats and people may 0:38:08.880 --> 0:38:13.160 be rethinking, um, their exposure to that part of the world. Christina, 0:38:13.200 --> 0:38:16.400 thank you so much. Bloomberg Business Week economicseditor Christina Limbled 0:38:16.440 --> 0:38:18.799 and of course Joel Weber, the editor of the magazine 0:38:18.880 --> 0:38:21.640 you're listening to, Bloomberg Business Week. Coming up, Chipotle seeing 0:38:21.719 --> 0:38:25.439 robust growth with diners undeterred by price hikes. You gotta 0:38:25.440 --> 0:38:29.520 get your burrito right too, and avocado. We'll break down 0:38:29.520 --> 0:38:32.000 the first quarter earnings with the company's chief technology officer. 0:38:32.080 --> 0:38:44.520 That's coming up next, and this is Bloomberg. This is 0:38:44.560 --> 0:38:48.440 Bloomberg Business Week with Carol Masser and Bloomberg Quick Takes 0:38:48.520 --> 0:38:53.960 Tim Stinovik from Bloomberg Radio. Chipotle Mexican Grill's latest menu 0:38:54.040 --> 0:38:58.000 price increases help boost comparable sales beyond analyst estimates. That 0:38:58.120 --> 0:39:01.600 key measure rose nine in the company's latest quarter. Chipoli 0:39:01.680 --> 0:39:04.279 still wants to expand its brick and mortar footprint as 0:39:04.280 --> 0:39:06.760 well as its digital reach. For more on the company's 0:39:06.800 --> 0:39:08.600 earnings in its path forward, it is the threat of 0:39:08.640 --> 0:39:11.160 COVID waynes here in the US. Carol spoke with Chief 0:39:11.239 --> 0:39:15.240 Technology Officer Kurt Garner. Our digital business wouldn't be strong 0:39:15.320 --> 0:39:19.600 if it wasn't for the great culinary teams at Chipotle. Certainly, 0:39:19.640 --> 0:39:24.160 the launch of new Pliosada was very, very popular as 0:39:24.160 --> 0:39:27.879 our most popular protein that we've ever introduced, and there's 0:39:27.880 --> 0:39:30.520 a lot of excitement now for people to come back 0:39:30.560 --> 0:39:34.040 and eat in restaurants and come to Chipole. You guys 0:39:34.040 --> 0:39:36.640 have been able to You are one of the few companies. 0:39:36.960 --> 0:39:39.040 You know, as we go through this earning season once again, 0:39:39.080 --> 0:39:41.120 there are some companies who can raise prices and keep 0:39:41.360 --> 0:39:43.680 customers still coming back, and there's some that cannot. You 0:39:43.719 --> 0:39:46.520 guys have been able to push through price increases to 0:39:46.560 --> 0:39:50.160 combat hire food prices, hired labor costs. That helped her 0:39:50.160 --> 0:39:52.800 out about this last quarter as well. Can you continue 0:39:52.800 --> 0:39:57.600 to do that though if needed? We're completely real ingredient company, 0:39:57.840 --> 0:40:01.319 very much farm to table and are very affordable in 0:40:01.400 --> 0:40:04.560 terms of what we provide. Certainly, we hope we don't 0:40:04.600 --> 0:40:07.239 have to continue to do this and that inflation and 0:40:07.239 --> 0:40:11.560 the other other pressures in the marketplace moderate or subside. 0:40:12.200 --> 0:40:14.239 But we're very happy with where we are right now, 0:40:14.280 --> 0:40:17.399 and we'll continue to take a look at what's going 0:40:17.480 --> 0:40:21.239 on across the business and across the landscape frankly of 0:40:21.280 --> 0:40:23.560 our supplier network as we get through the rest of 0:40:23.560 --> 0:40:25.600 the year. So current is it's safe to say fair 0:40:25.640 --> 0:40:28.800 to say though that raising prices. Continuing to raise prices 0:40:28.840 --> 0:40:31.479 is always on the table if need be well. Again, 0:40:31.520 --> 0:40:34.359 we're going to continue to investigate and look at what's 0:40:34.400 --> 0:40:37.000 going on. I would never say that anything's on or 0:40:37.040 --> 0:40:42.400 off the table permanently. We're a company operated organizations, so 0:40:42.480 --> 0:40:45.680 we can move quickly as new data becomes available to us. 0:40:45.960 --> 0:40:49.640 And again we're hopeful that we're past most of the 0:40:49.680 --> 0:40:52.880 acceleration that we've seen in terms of commodity prices. But 0:40:53.239 --> 0:40:56.000 we're going to continue to be wise and how we 0:40:56.080 --> 0:40:59.320 run the business and how we consume that data. Recently 0:40:59.360 --> 0:41:01.840 caught up with Jack Cartown. We talked about labor, we 0:41:01.920 --> 0:41:04.799 talked about supply chains. What's the toughest nut to crack 0:41:04.920 --> 0:41:08.800 right now? I think for us, it's about continuing to 0:41:08.800 --> 0:41:12.239 to provide access to our customers, and when we do 0:41:12.280 --> 0:41:15.959 that and do that really well, we provide growth opportunities 0:41:15.960 --> 0:41:19.000 for our teams. Um Certainly the last couple of years, 0:41:19.040 --> 0:41:20.840 there have been a lot of challenges that we've all 0:41:21.000 --> 0:41:24.640 had to face, uh and frankly adapt our business too. 0:41:25.480 --> 0:41:29.080 At the same time. Finding great real estate, continuing to 0:41:29.120 --> 0:41:33.239 develop our people, innovating and food and technology are all 0:41:33.440 --> 0:41:35.600 the things that we're focused on right now as we 0:41:35.640 --> 0:41:39.600 continue to be an extraordinary growth company in this environment. 0:41:39.960 --> 0:41:42.520 How's the supply chain doing. Our teams have done a 0:41:42.560 --> 0:41:46.600 great job working with our suppliers. Certainly their stressed within 0:41:46.640 --> 0:41:50.440 the network. A lot of our relationships are very long standing. 0:41:50.520 --> 0:41:53.080 We've been partners for a very long time, and we 0:41:53.120 --> 0:41:55.319 look at it in a partnership model of how we 0:41:55.360 --> 0:41:59.120 can work collaboratively with all of our suppliers and vendors 0:41:59.360 --> 0:42:02.880 to make sure that they're okay as we're going through this, 0:42:03.080 --> 0:42:06.120 and make sure that we're okay and and stock and 0:42:06.280 --> 0:42:08.640 able to provide the experience that we need to to 0:42:08.680 --> 0:42:10.560 provide to our customers. But you know, we all like 0:42:10.600 --> 0:42:12.959 to mention it like there's some stress points, right, whether 0:42:12.960 --> 0:42:15.400 it's avocados or some different things. I mean, is it 0:42:15.400 --> 0:42:18.520 getting more difficult, is it easy? Is it easing a 0:42:18.600 --> 0:42:20.400 little bit, or is it just kind of more the 0:42:20.440 --> 0:42:22.320 same of what we've seen over the last couple of months. 0:42:22.960 --> 0:42:26.160 It seems like we're getting to a point where it's stabilizing, 0:42:26.840 --> 0:42:30.200 But uh, it's hard to tell what the next challenge 0:42:30.239 --> 0:42:34.279 or shock to the system will be. Certainly the avocado 0:42:34.360 --> 0:42:36.360 issue was more of a political one than it was 0:42:36.880 --> 0:42:42.200 a pure supply chain or agricultural challenge. Our suppliers are 0:42:42.200 --> 0:42:45.080 continuing to face challenges with we all ingredients and with labor, 0:42:45.200 --> 0:42:47.360 so there are a lot of different things that go 0:42:47.480 --> 0:42:50.120 on to that or go into that. But again, Carol, 0:42:50.239 --> 0:42:52.600 it seems like at this point we're starting to hit 0:42:52.640 --> 0:42:56.160 more of a place where it's moderating, but we're going 0:42:56.160 --> 0:43:00.520 to continue to again be wise and sure that We're 0:43:00.560 --> 0:43:02.719 agile and able to react to an even challenges that 0:43:02.800 --> 0:43:05.280 might come up. You know, Kurt, all of your management 0:43:05.320 --> 0:43:07.560 team always talks about the culture at the company, and 0:43:07.640 --> 0:43:10.520 key to that culture is the employees. Those that in particular, 0:43:10.600 --> 0:43:13.840 we see front and center center As customers talked to 0:43:13.880 --> 0:43:16.960 us about the labor market, is that also moderating? Is 0:43:17.000 --> 0:43:19.160 that plateauing in terms of the stresses there and the 0:43:19.160 --> 0:43:21.640 difficulty to find workers or pay up for those workers. 0:43:22.040 --> 0:43:25.480 We're really really excited that our labor situation right now 0:43:25.560 --> 0:43:28.400 is the best that it's been in several years. And 0:43:29.000 --> 0:43:31.120 that's a result of the fact that we're a growth 0:43:31.120 --> 0:43:36.560 company that's investing heavily within our teams. Of our general 0:43:36.600 --> 0:43:40.120 managers were internal promotions last year. UH, and that's some 0:43:40.200 --> 0:43:44.719 power that we have as a company operated growth company. UM. 0:43:44.800 --> 0:43:47.080 Within three years, you can go from being a crew 0:43:47.080 --> 0:43:50.600 member to running a Chipotle UH. And we just promoted 0:43:50.600 --> 0:43:55.080 a regional vice president who runs several hundred restaurants that 0:43:55.120 --> 0:43:58.520 have started as a crew member. So that strong career 0:43:58.600 --> 0:44:02.000 path and the opportunity that provide we, we think is 0:44:02.480 --> 0:44:05.560 a big part of why our staffing levels frankly, are 0:44:05.760 --> 0:44:08.000 in really good shape right now, Hey, one thing I 0:44:08.040 --> 0:44:10.760 wanted to ask you, and and the Bloomberg Green Summit 0:44:10.840 --> 0:44:13.320 is going on, and I caught up with the founder 0:44:13.320 --> 0:44:16.600 and head of Daily Harvest and they are big on 0:44:16.800 --> 0:44:20.840 organic farming and regenerated farming and really speaks to what 0:44:21.480 --> 0:44:23.600 so many of the initiatives you guys are doing over Chippola. 0:44:23.640 --> 0:44:25.520 Talk to me about Cultivate Next because this is your 0:44:25.520 --> 0:44:29.920 opportunity to invest in those companies that align with your mission. Yeah, 0:44:30.200 --> 0:44:33.359 we're really excited about Cultivate Next UM and I've I've 0:44:33.360 --> 0:44:37.200 said it earlier. We're a company operated, restaurant chained, so 0:44:37.360 --> 0:44:39.600 when we find a new idea, we can be agile 0:44:39.640 --> 0:44:43.200 and pivot very quickly. We've got a very strong balance sheet, 0:44:43.560 --> 0:44:47.520 and we've got a great technology foundation. It makes us 0:44:47.560 --> 0:44:51.239 the ideal sandbox to be an accelerator for new technologies 0:44:51.280 --> 0:44:54.600 and new ideas. Since the announcement of the fun UH, 0:44:54.680 --> 0:44:58.279 our expectations have been certainly surpassed in terms of the 0:44:58.360 --> 0:45:01.920 interest that we're seeing the amount of a number and diversity, frankly, 0:45:02.400 --> 0:45:04.760 of companies that have reached out to us to become 0:45:04.960 --> 0:45:08.040 part of this UH. And and we're looking at this 0:45:08.120 --> 0:45:11.200 across the business as ways to improve the experience of 0:45:11.239 --> 0:45:14.520 working within the Chipole That proved the experience as a 0:45:14.680 --> 0:45:18.160 guest of Chipotle certainly down into the supply chain and 0:45:18.200 --> 0:45:21.480 our mission of cultivating a better world. We think there's 0:45:21.520 --> 0:45:24.840 a lot of good ideas out there looking for a 0:45:24.880 --> 0:45:28.320 space to show what they can do, and we believe 0:45:28.360 --> 0:45:33.120 that we're again a great platform for that type of ideation. Yeah, 0:45:33.200 --> 0:45:36.800 it's interesting to hear the conversations around this. Certainly, moving forward, 0:45:36.800 --> 0:45:39.200 I feel like more broadly out in the world. Hey, 0:45:39.200 --> 0:45:42.479 one last question, Kurt Um, you guys feel confident enough 0:45:42.640 --> 0:45:47.200 in terms of your cap spend, your increase of stores, 0:45:47.760 --> 0:45:49.840 all of your missions at this point or do you 0:45:49.880 --> 0:45:52.000 feel like the outlook is a little murky and you 0:45:52.080 --> 0:45:56.160 might have to hold back. We're extremely optimistic. We're continuing 0:45:56.239 --> 0:45:59.959 to grow. We're accelerating our new restaurant account this year. 0:46:00.400 --> 0:46:03.880 We're not even halfway to our goal of seven thousand 0:46:03.960 --> 0:46:07.959 restaurants in North America, and we're not at our goal 0:46:08.000 --> 0:46:11.319 of what we believe our average unit volumes will be yet. 0:46:11.400 --> 0:46:15.520 So all of our growth strategies are intact. Certainly, our 0:46:15.560 --> 0:46:19.320 staff in situation gives us a lot of comfitt confidence 0:46:19.320 --> 0:46:23.400 and optimist optimism that we're going to have the leaders 0:46:23.400 --> 0:46:25.440 of the future to help us run the company as 0:46:25.440 --> 0:46:29.040 we grow, so it's full steam ahead. That was Kurt Garner. 0:46:29.080 --> 0:46:32.520 He's chief technology officer at Chipotle Mexican. Grow still to 0:46:32.560 --> 0:46:36.320 come on Bloomberg Business Week and organic food maker setting 0:46:36.360 --> 0:46:40.239 its sites even higher after achieving Unicorn status. This is 0:46:40.239 --> 0:46:50.600 Bloomberg broadcasting from the financial capital of the world Bloomberg 0:46:50.640 --> 0:46:54.160 eleven Frio in New York to Washington, d C. Bloomberg 0:46:55.120 --> 0:46:58.360 to Boston, Bloomberg one oh six one does San Francisco, 0:46:58.400 --> 0:47:01.839 Bloomberg nine sixty to the country Serious XM Chado one 0:47:01.920 --> 0:47:04.879 nine team and around the globe the Bloomberg Business app 0:47:05.000 --> 0:47:09.480 and Bloomberg Radio dot Com. This is Bloomberg Business Week. 0:47:10.360 --> 0:47:13.120 Bloomberg Green Summit took place this past week. It's where 0:47:13.120 --> 0:47:16.320 we check in on investors, companies, individuals who are paving 0:47:16.320 --> 0:47:19.319 the way for more sustainable and climate conscious future. That 0:47:19.400 --> 0:47:22.440 includes the start up Daily Harvest. It counts Serena Williams, 0:47:22.440 --> 0:47:25.680 Bobby Flay, and Gwyneth Paltrow among its investors. It's a 0:47:25.719 --> 0:47:29.120 direct to consumer organic produced vendor, and its latest funding 0:47:29.160 --> 0:47:32.200 round pushed it past a billion dollar valuation and into 0:47:32.360 --> 0:47:35.120 Unicorn territory. I sat down with the CEO and founder 0:47:35.200 --> 0:47:39.400 Rachel Drury and chief supply chain officer Ricky Silver. We 0:47:39.480 --> 0:47:41.840 talked about with the government and companies can do to 0:47:41.880 --> 0:47:45.920 help the organic farming space. People can vote with their dollars, 0:47:46.000 --> 0:47:49.840 people can can put their their money where their mouth is. Um. 0:47:49.880 --> 0:47:52.280 But these problems have to be solved at the corporate 0:47:52.320 --> 0:47:56.720 and systemic level. Um. There's so much research that needs 0:47:56.760 --> 0:48:01.120 to be done on regenerative agriculture and um, you know, 0:48:01.520 --> 0:48:05.960 agriculture and climate change that the government needs to invest in. 0:48:06.040 --> 0:48:10.120 And you know, I think about farm subsidies where um, 0:48:10.160 --> 0:48:13.320 you know, soy wheat corn are where the government is 0:48:13.360 --> 0:48:16.800 still putting their money after all these years, and the 0:48:17.040 --> 0:48:20.200 downstream effects of those investments, where if we took that 0:48:20.239 --> 0:48:24.040 money and put it towards investment and research and regenerative agriculture, 0:48:24.120 --> 0:48:26.560 we would be in a whole different place. I'd also 0:48:26.560 --> 0:48:29.560 love to say there's some basic oversight and sort of 0:48:29.680 --> 0:48:33.719 action of the systems within government that we can uh 0:48:33.719 --> 0:48:36.280 push for. So for example, we were down an organic 0:48:36.320 --> 0:48:38.759 week a couple of weeks back, um, and there's a 0:48:38.760 --> 0:48:41.080 bill that right now is being pushed called the Continuous 0:48:41.120 --> 0:48:44.560 Improvement and Accountability Act for Organic that would basically just 0:48:45.080 --> 0:48:48.560 ensure a twenty year backlog of recommendations and changes to 0:48:48.600 --> 0:48:52.720 how organic is managed and overseen uh go into effect 0:48:52.800 --> 0:48:55.160 or at least get reviewed. And that type of a 0:48:55.200 --> 0:48:58.200 backlog is exactly why I think the farming community, the 0:48:58.200 --> 0:49:01.280 AG space hasn't been able to make more progress because 0:49:01.560 --> 0:49:04.600 government isn't stepping up and even doing the fundamentals, let 0:49:04.600 --> 0:49:06.799 alone the investments. At Rachel's talk, so you're saying there's 0:49:06.800 --> 0:49:09.839 a backlog of farmers who want to produce organically and 0:49:10.080 --> 0:49:12.040 they just need to be signed off unimproved. More so, 0:49:12.200 --> 0:49:16.080 the you know, the oversight of the organic certification process 0:49:16.120 --> 0:49:18.759 something that means a lot to consumers, right, you need 0:49:18.800 --> 0:49:20.600 to have trust in that. So there's a backlog of 0:49:20.640 --> 0:49:23.880 recommendations that would make the oversight and the process of 0:49:23.920 --> 0:49:27.319 becoming organic certified or maintaining it. This is the Green Summit, right, 0:49:27.360 --> 0:49:29.600 And so we're thinking about things that impact the environment. 0:49:29.719 --> 0:49:33.400 Why is organic farming? Why is regenerative farming? Which is 0:49:33.440 --> 0:49:36.040 what you guys are focusing on. Why is this so important? 0:49:36.040 --> 0:49:39.239 And part of understanding this is understanding exactly what regenerative 0:49:39.239 --> 0:49:43.200 farming is about versus conventional farming. Absolutely, I mean, regenerative 0:49:43.200 --> 0:49:47.000 agriculture just a level set is bringing our soil back 0:49:47.040 --> 0:49:49.680 to a place where, you know, mother nature can do 0:49:49.719 --> 0:49:52.480 what mother nature does. It takes a lot of hubris 0:49:52.520 --> 0:49:54.960 for us as a society to to say like, oh, 0:49:55.040 --> 0:49:57.759 we can do better than mother nature. We can you know, 0:49:57.880 --> 0:50:02.200 use you know, fungicides and pesticides and fertilizers to do 0:50:02.320 --> 0:50:05.640 something better. So it's kind of bringing agriculture, bringing our 0:50:05.719 --> 0:50:09.040 soil back to a place where it can sustain human 0:50:09.080 --> 0:50:12.359 life on this planet for future generations. Yeah. I would 0:50:12.400 --> 0:50:13.920 just say the other thing that's really important to know 0:50:14.040 --> 0:50:17.800 is that this is not new, right. Regenerative agriculture is 0:50:17.800 --> 0:50:20.480 certainly kind of what farmers did wait way back when. Yeah, 0:50:20.520 --> 0:50:23.239 And it's it's about a holistic approach to as Rachel said, 0:50:23.400 --> 0:50:26.960 both soil management and the farm management right, the people 0:50:26.960 --> 0:50:29.080 on the on the land as well. Can we scale 0:50:29.120 --> 0:50:31.319 it up? I mean, just looking at some statistics in 0:50:31.400 --> 0:50:34.320 terms of agriculture and what it you know, the contribution 0:50:34.360 --> 0:50:37.399 to the economy, but so much is done conventionally. Can 0:50:37.520 --> 0:50:40.279 we scale it up? Yes? I think that there's a 0:50:40.320 --> 0:50:44.280 big misnomer that says, you know, organic agriculture and regenerative 0:50:44.320 --> 0:50:46.880 agriculture can't be scaled. But the truth is many farmers 0:50:46.920 --> 0:50:49.520 are doing this already, and so it's not to say 0:50:49.560 --> 0:50:51.399 that it can't be scaled. But why aren't more then 0:50:51.719 --> 0:50:54.160 because the organic is what was the statistic you shared 0:50:54.239 --> 0:50:56.959 with me, So food that we act, that we eat 0:50:57.280 --> 0:50:59.920 is one percent of US agriculture, only one percent of 0:51:00.000 --> 0:51:02.439 that is organic, so a really small amount. So why 0:51:02.520 --> 0:51:05.520 can't So why aren't were doing it? It's expensive and unproven, 0:51:05.520 --> 0:51:07.440 and so you think about what the farming community is 0:51:07.440 --> 0:51:09.400 looking for, right, we we do go out of our 0:51:09.400 --> 0:51:11.279 way to make sure we listen first. Right, We're not 0:51:11.320 --> 0:51:13.320 going to tell people what they should do. We're gonna listen. 0:51:13.640 --> 0:51:16.000 And what's amazing to see is in a more regional, 0:51:16.080 --> 0:51:19.280 local way there are farmers that are building community around 0:51:19.320 --> 0:51:23.239 applying these regenerative practices, improving to themselves that it makes 0:51:23.239 --> 0:51:25.279 a difference. Right, And so how do you go to 0:51:25.760 --> 0:51:28.880 the farming community that is you know, Razor thin Margins 0:51:28.920 --> 0:51:30.880 already and said we need you to spend more to 0:51:31.000 --> 0:51:33.920 invest This might take five ten years to you know, 0:51:34.000 --> 0:51:36.719 get to the outposts you need. That's where businesses and 0:51:36.719 --> 0:51:40.080 government needs to step in and incentivize that transition, and 0:51:40.120 --> 0:51:42.960 that's really where we play a role. Right. So we 0:51:43.040 --> 0:51:45.040 have a belief that if everybody eats more fruits and 0:51:45.120 --> 0:51:48.279 vegetables every single day, that this is something that is 0:51:48.320 --> 0:51:50.840 objectively good for humans and objectively good for the planet. 0:51:51.040 --> 0:51:53.080 But not all fruits and vegetables are grown the same way, 0:51:53.120 --> 0:51:55.120 and they have to be grown in a way that 0:51:55.320 --> 0:51:57.560 gives back to the soil that that puts us all 0:51:57.600 --> 0:52:01.160 in a in a better position. Um So, giving those 0:52:01.200 --> 0:52:05.000 farmers a hand and saying that we will help support 0:52:05.000 --> 0:52:08.400 you through the three year transition from conventional two organic. 0:52:08.920 --> 0:52:12.240 That was Daily Harvest founder and CEO Rachel Dorry, along 0:52:12.280 --> 0:52:15.440 with Chief Supply chain Officer Ricky Silver at the Bloomberg 0:52:15.440 --> 0:52:18.080 Green Summit. Check out the full conversation that Carol had 0:52:18.120 --> 0:52:20.440 You can do that at Bloomberg Live dot com and 0:52:20.520 --> 0:52:23.120 one other note. Daily Harvest also launching its own version 0:52:23.120 --> 0:52:26.320 of plant based meat, Rachel revealing that touring our discussion, 0:52:26.400 --> 0:52:29.000 we made some news. You know what's different about it 0:52:29.160 --> 0:52:31.520 what it's grown from the ground, not in a lab 0:52:31.680 --> 0:52:36.560 on a meat tree. Plants, you're just gonna have to listen. 0:52:36.600 --> 0:52:38.719 You're gonna have to go and check out the full conversation. 0:52:39.280 --> 0:52:41.759 You're listening to Bloomberg Business Week coming up, behind the 0:52:41.800 --> 0:52:44.800 scenes of the most lavish weddings money can buy. This 0:52:45.000 --> 0:52:58.240 is Bloomberg. You're listening to Bloomberg Business Week with Carol 0:52:58.280 --> 0:53:02.520 Messer and Bloomberg. Quick to Tim Stinovik from Bloomberg Radio. 0:53:03.840 --> 0:53:06.799 Planning a wedding weather for yourself or your kid or 0:53:06.840 --> 0:53:08.680 anyone else. You can kind to say, it's among the 0:53:08.680 --> 0:53:11.759 most stressful social activities on the planet. But what if 0:53:11.800 --> 0:53:14.479 your reward or job for doing so was, let's say 0:53:14.600 --> 0:53:17.879 a six or perhaps a seven figure page check, would 0:53:17.920 --> 0:53:21.120 that kind of help take the edge off? Probably be? Probably, 0:53:21.160 --> 0:53:24.399 it's still a very stressful job. Well, Bloomberg Pursuits team 0:53:24.440 --> 0:53:26.600 has the right person to help us find out. Brandon 0:53:26.640 --> 0:53:29.319 Presser has already been undercover as a go between for 0:53:29.400 --> 0:53:32.919 Vegas high Rollers a decade on super Yachts even you'll 0:53:32.960 --> 0:53:35.440 recall not so long ago as a cast member at 0:53:35.480 --> 0:53:38.640 Disney World. Now he's taken us behind the scenes at 0:53:38.680 --> 0:53:42.320 some ultra opulent weddings. I mean we're talking ultra opulent, 0:53:42.440 --> 0:53:45.240 like tens of millions of dollars like crazy amount. Brandon 0:53:45.280 --> 0:53:46.919 spent a week working with some of the top event 0:53:46.960 --> 0:53:50.040 planners in the world and discovered all the unromantic work 0:53:50.080 --> 0:53:53.480 that goes into achieving nuptial bliss. He and Bloomberg Pursuits 0:53:53.560 --> 0:53:55.359 editor Chris Royles are joining us now with a look 0:53:55.400 --> 0:53:57.960 at the lead story in this week's Pursuit section. Because 0:53:58.000 --> 0:54:00.279 let me just set you and Brandon of on each 0:54:00.280 --> 0:54:02.120 other for a while. You've done a lot of these ventures. 0:54:02.120 --> 0:54:04.600 I gotta say that Disney one was a favor of mine. 0:54:04.960 --> 0:54:07.600 So tell me about, Like, how did you suggest this 0:54:07.640 --> 0:54:10.200 to Brandon? Brandon? Did Brandon come to you with this idea? 0:54:10.400 --> 0:54:13.680 Brandon came to us with this idea. So we sometimes, um, 0:54:13.719 --> 0:54:16.880 when we're daydreaming about where to send the amazing Brandon undercover, 0:54:16.960 --> 0:54:20.279 we'll think, Okay, what's a like a crazy sort of 0:54:20.760 --> 0:54:23.359 ultra luxury experience that we want to know more about, 0:54:23.480 --> 0:54:25.719 like you know, being a ski Instarcter at Aspen or 0:54:25.760 --> 0:54:28.440 being a waiter at nobu Um. And then Brandon, through 0:54:28.440 --> 0:54:30.320 this process actually gets to know a lot of the 0:54:30.320 --> 0:54:32.840 people who work in the in service in these industries, 0:54:33.160 --> 0:54:36.200 and he can sometimes say, like you know, I haven't 0:54:36.200 --> 0:54:37.839 in at this place where like I think we can 0:54:37.880 --> 0:54:41.880 do this. So we he did um like ultra luxury 0:54:41.960 --> 0:54:44.600 vacations like honeymoon planning, and that kind of led him 0:54:44.640 --> 0:54:47.240 to this. We started think Brandon with with Colin Cowie. 0:54:47.280 --> 0:54:49.719 That's a good place to start because he is the 0:54:49.800 --> 0:54:52.839 party planner to the stars. Who is he and why 0:54:52.880 --> 0:54:54.440 do you need at least a million bucks for him 0:54:54.440 --> 0:54:56.960 to even pay attention to you? Well, I think Colin 0:54:57.360 --> 0:55:01.200 has cultivated a celebrity status in his own right, and 0:55:01.239 --> 0:55:04.920 he sort of created a brand around himself long before 0:55:05.320 --> 0:55:09.640 the idea of branding oneself was a thing. Back about 0:55:10.360 --> 0:55:14.120 five years ago. He started working with Oprah and Oprah 0:55:14.239 --> 0:55:16.799 sort of dubbed him the event center to the Star, 0:55:16.920 --> 0:55:20.120 So then everyone came running um and then so you know, 0:55:20.160 --> 0:55:23.880 he's planned events and weddings for everyone from John Travolta 0:55:23.920 --> 0:55:29.720 to Bruce Willis, Tryan Seacrest to um Mariah carry uh 0:55:29.760 --> 0:55:32.120 and and and so the brand has solved him around 0:55:32.120 --> 0:55:35.279 and people who want that sort of star studded experience 0:55:35.800 --> 0:55:39.600 seek him out, and he can command a million dollars 0:55:39.680 --> 0:55:42.360 to produce, you know, a sort of entry level wedding 0:55:42.400 --> 0:55:44.440 in his in his world? What is he like a 0:55:44.440 --> 0:55:46.279 supermodel from the nineties. I don't get out of bed 0:55:46.320 --> 0:55:50.040 for a for a million dollars. That's funny thing you 0:55:50.080 --> 0:55:52.480 say that, because when I was writing this story, actually 0:55:52.680 --> 0:55:56.360 was toying with trying to do like a Linda Linda 0:55:56.400 --> 0:55:59.960 Evandelista lead for the story, and it just totally ended 0:56:00.000 --> 0:56:01.719 I think a bit of a metaphor, but I was 0:56:01.719 --> 0:56:04.400 thinking about that the whole time. So, Chris, what was 0:56:04.400 --> 0:56:06.919 it that you wanted to know top of mind from Brandon? Well, 0:56:06.960 --> 0:56:09.080 you know, I a lot of times what's interesting about 0:56:09.080 --> 0:56:12.720 these undercover stories is a that the people who work 0:56:12.880 --> 0:56:16.560 that Brandon works with are incredibly talented and they are 0:56:16.600 --> 0:56:20.839 able to accomplish like superhuman feats of um, you know, 0:56:20.880 --> 0:56:23.839 making amazing things happen and dealing with insane requests and 0:56:23.840 --> 0:56:27.200 then be the second most interesting thing is usually the 0:56:27.920 --> 0:56:30.960 bad behavior or the wild requests of the people who 0:56:31.040 --> 0:56:33.319 are indulging in the service. So I wanted to know 0:56:33.640 --> 0:56:38.080 how crazy the brides and grooms were, and you know, 0:56:38.120 --> 0:56:41.120 Brandon actually learned that, you know, the whole sort of 0:56:41.120 --> 0:56:45.400 bride zilla groom zilla thing isn't really as much of 0:56:45.400 --> 0:56:47.719 a thing at this tier. When people are spending one 0:56:47.800 --> 0:56:50.560 to eleven million dollars on a wedding, they're getting everything 0:56:50.600 --> 0:56:55.279 they want, But what about mom Zilla or Dad's right, 0:56:55.400 --> 0:56:58.600 So the people the zilla's are the people around the 0:56:58.640 --> 0:57:01.960 bride and groom. And Brandon saw some some bad behavior 0:57:02.040 --> 0:57:05.600 on the parts of families of celebrities. So I don't know, Brandon, 0:57:05.600 --> 0:57:08.160 you want to tell them about some of the family 0:57:08.160 --> 0:57:11.520 bad behavior you saw? Yeah? No, absolutely, Yeah. Going into this, 0:57:11.600 --> 0:57:13.799 I was really excited to mind, you know, some of 0:57:13.800 --> 0:57:15.840 the more classic breend Bill the stories, and it was 0:57:15.880 --> 0:57:17.600 told to me right from the start. You know, when 0:57:17.640 --> 0:57:21.600 you're getting everything you want for your wedding, you're the 0:57:21.840 --> 0:57:24.120 latitude doesn't come out. But then the mom's that like 0:57:24.160 --> 0:57:30.400 treaks out, especially amongst um new moneyed individuals, because likely 0:57:30.480 --> 0:57:32.640 when they were, you know, in their twenties or early 0:57:32.680 --> 0:57:35.600 threes having their wedding, Um, they didn't get to have 0:57:35.960 --> 0:57:39.120 the nine million dollar wedding. So um. Some of the 0:57:39.120 --> 0:57:41.680 funny things that I was hearing about was that a 0:57:41.800 --> 0:57:48.600 mom would wear white um to the wedding. In college Champagne, 0:57:50.200 --> 0:57:52.919 there was there was a mom who had the videographer 0:57:53.280 --> 0:57:57.280 completely re edit the wedding video. Because she didn't star 0:57:57.600 --> 0:57:59.640 in it enough. By the way, who goes back and 0:57:59.640 --> 0:58:05.400 watch of those things anyway? Yeah, well it's interesting too, 0:58:05.400 --> 0:58:07.240 So tell us about some of the other things that 0:58:07.280 --> 0:58:10.840 you came about came across I mean, open bars being 0:58:10.960 --> 0:58:13.960 kind of the devil. There's a great story I'm gonna 0:58:14.040 --> 0:58:17.360 go there about someone who got so drunk. What happened? 0:58:18.000 --> 0:58:23.280 Oh yeah, um? So at one oneting, you know, it's 0:58:23.320 --> 0:58:26.680 really hard to control alcohol consumption. UM. At a wedding, 0:58:26.800 --> 0:58:29.800 you bought out the whole resort. Um. You know, you 0:58:29.880 --> 0:58:32.440 have all the service that you can ever need, um, 0:58:32.480 --> 0:58:34.440 and you can't water down the drinks because you need 0:58:34.520 --> 0:58:37.680 to keep everything, you know, at a certain standard. Um. 0:58:37.720 --> 0:58:41.560 So people just get absolutely shattered. And one woman actually 0:58:42.040 --> 0:58:44.680 was so drunk she fell over onto her wineglass and 0:58:44.680 --> 0:58:48.120 it popped her silicone bread. So that is why Colin 0:58:48.160 --> 0:58:50.800 Cowy always has an ambulance at every event at the 0:58:51.200 --> 0:58:55.680 um that he throws popped os or not. Okay, well, 0:58:55.720 --> 0:58:58.040 I think this perhaps could be the perfect segue to 0:58:58.160 --> 0:59:03.320 talk about once catering a Game of Thrones themed wedding 0:59:03.320 --> 0:59:08.240 at a private estate. There was body paint involved, but 0:59:08.560 --> 0:59:10.919 I'll let you take it away well, I should say 0:59:11.040 --> 0:59:14.200 so Colin Cowie, that does predate himself with inventing the 0:59:14.280 --> 0:59:17.800 human food tray. And that's not like the like a 0:59:17.840 --> 0:59:27.040 regular Thomas. I mean someone had to do it, um 0:59:27.360 --> 0:59:31.360 and uh. And so he creates these architectural pieces that 0:59:31.440 --> 0:59:34.080 you know, he can have his servers go around and 0:59:34.120 --> 0:59:36.280 you can pick food off of their dress or different 0:59:36.280 --> 0:59:38.240 things like that. And then you know other people have 0:59:38.360 --> 0:59:42.440 mimicked that. Um. And so there's an individual um who 0:59:42.880 --> 0:59:46.400 through a wedding UM that the groom was an art 0:59:46.480 --> 0:59:49.440 and game of thrones span and he wanted all of 0:59:49.480 --> 0:59:53.760 that sort of sexiness from you know, medieval sexiness imbued 0:59:53.760 --> 0:59:56.720 in the festivities. Um. And he doesn't have to have 0:59:56.760 --> 0:59:59.640 a b DSM dungeon in his house regular I mean 1:00:00.400 --> 1:00:03.280 basically all right. I mean you know, if you live 1:00:03.320 --> 1:00:07.000 in the burbs, why not and and uh and they 1:00:07.040 --> 1:00:09.320 made fully they made full use of it because it 1:00:09.360 --> 1:00:12.640 was thrown at his private states. I'm speechless. You get that, 1:00:12.760 --> 1:00:14.720 you get the wedding. You aren't when you're paying uh 1:00:14.760 --> 1:00:16.880 that level of money. Brandon, what are the some of 1:00:16.880 --> 1:00:19.120 the fun or funny things that you had to do? 1:00:19.280 --> 1:00:23.960 Like uh, I remember you were telling us that there 1:00:24.040 --> 1:00:29.600 was some some sneaking of snacks across borders. Yeah. So 1:00:29.640 --> 1:00:33.560 one of the big things, um is the welcome amenity. Right, 1:00:33.640 --> 1:00:36.560 So if you're doing a destination wedding, you want to curate, 1:00:36.680 --> 1:00:41.200 you know, a very special personalized welcome amenity, and that 1:00:41.280 --> 1:00:45.560 usually is a snass box or something like that. And UM, 1:00:45.600 --> 1:00:48.400 at the wedding that I was working out in Mexico, UM, 1:00:48.680 --> 1:00:54.560 the Brandon groom really loved Freedo's and the very specific 1:00:54.600 --> 1:00:57.560 type of freedom that you can't get in Mexico. So 1:00:57.720 --> 1:01:01.920 I was responsible for actually stuffing two duffle bag full 1:01:02.080 --> 1:01:05.920 of these barbecued flavor twists and kind of having to 1:01:05.960 --> 1:01:10.200 smuggle them across the border, Otherwise it would have looked 1:01:10.240 --> 1:01:12.080 like I was trying to sell them in Kanon. Or 1:01:13.360 --> 1:01:16.760 when I think multimillion dollars weddings, I think barbecue flavor 1:01:16.760 --> 1:01:21.120 twist Freedo's for sure first thing that comes to mind. Well, 1:01:21.320 --> 1:01:23.960 one thing that I speaking of smuggling and just logist 1:01:24.080 --> 1:01:28.400 logistics of this, getting everything to a destination where the 1:01:28.400 --> 1:01:30.320 wedding is is a big part of this. And one 1:01:30.360 --> 1:01:32.560 thing that you wrote about was the use of private 1:01:32.600 --> 1:01:39.400 aircraft or cargo containers to actually get furniture, food, why meat, 1:01:39.800 --> 1:01:42.840 The list goes on, uh in the in the realm 1:01:42.880 --> 1:01:45.440 of the millions of dollars. Yeah, and and the planning 1:01:45.520 --> 1:01:47.920 starts so early. So for example, at the wedding that 1:01:47.960 --> 1:01:51.120 I was working at, UM, they it was a kacher wedding, 1:01:51.160 --> 1:01:54.240 so they wanted particular meats to be brought down from 1:01:54.280 --> 1:01:58.240 the United States. And UM there was actually of an 1:01:58.280 --> 1:02:03.400 overland like a large semi truck that left New York 1:02:03.440 --> 1:02:08.320 City ten weeks before the wedding to make sure that 1:02:08.480 --> 1:02:12.640 certain materials arrived to set up a kosher kitchen in Mexico. 1:02:13.160 --> 1:02:16.680 With all this spending and all this planning, UM, it 1:02:16.720 --> 1:02:19.240 doesn't always actually I'll go the way you expect. In 1:02:19.280 --> 1:02:22.120 other words, it doesn't always happen right, because prenups kind 1:02:22.120 --> 1:02:27.320 of get in the way sometimes, you know. Yeah, UM, 1:02:27.400 --> 1:02:31.760 I think the prenup is the ultimate UM weapon UM 1:02:31.880 --> 1:02:34.720 that is wielded at the last minute. If someone wants 1:02:34.760 --> 1:02:38.960 to get more money UM in the prenup, they'll wait 1:02:39.320 --> 1:02:41.880 and sign right before the wedding. And you know, with 1:02:41.920 --> 1:02:45.920 the threat of cancelation UM and Colin has this incredible 1:02:46.000 --> 1:02:50.520 ability to befriend a lot of his clients, and sometimes 1:02:50.520 --> 1:02:55.400 he gets rolled into the prenup drama. A big thank 1:02:55.440 --> 1:02:58.600 you to Bloomberg contributor Brandon press Or, of course, also 1:02:58.640 --> 1:03:03.840 to Bloomberg Pursuits editor Is Rouser. Another great undercover tail. Yeah, 1:03:03.880 --> 1:03:06.560 a pretty stressful job apparently a wedding planner. That wraps 1:03:06.640 --> 1:03:09.280 up the weekend edition of Bloomberg Business Week from Bloomberg Radio. 1:03:09.320 --> 1:03:11.440 Thanks so much for joining us. I'm Carol Masser and 1:03:11.440 --> 1:03:14.040 I'm Tim Stanovik. Be sure to tune into Bloomberg Business 1:03:14.120 --> 1:03:16.160 Week Monday through Friday. It starts at two pm Wall 1:03:16.160 --> 1:03:18.400 Street Time on Bloomberg Radio. You can also watch our 1:03:18.440 --> 1:03:21.680 daily broadcast on YouTube. Just search Bloomberg Global News and 1:03:21.760 --> 1:03:24.080 check out our Bloomberg Business Week podcast. You can find 1:03:24.080 --> 1:03:26.280 it at Bloomberg dot com, Apple, or wherever you get 1:03:26.320 --> 1:03:29.040 your podcast. Bloomberg Business Week is available on newstands, now, 1:03:29.120 --> 1:03:31.360 at Bloomberg dot com, at business week dot com, and 1:03:31.440 --> 1:03:33.800 always on the Bloomberg terminal. You can also see me 1:03:33.880 --> 1:03:37.200 on Bloomberg Quick Take, available at Bloomberg dot com, slash qt, 1:03:37.400 --> 1:03:41.240 and streaming platforms like Roku, Apple TV, Samsung TV, and more. 1:03:41.360 --> 1:03:43.280 Have a great weekend, everyone. Did you have a pre nup? 1:03:43.400 --> 1:03:45.960 Did your wife had a pre up? First of all, 1:03:45.960 --> 1:03:49.480 that's a personal question. Okay, did you know? I'll be 1:03:49.640 --> 1:03:52.440 fully there was no prenups, but there was also did 1:03:52.440 --> 1:03:53.920 you see that? You know it's not too late. You 1:03:53.920 --> 1:03:55.919 can do postnups too. Do you know in that story 1:03:56.000 --> 1:03:59.760 the average wedding I think for most America exactly. Big difference, 1:04:00.000 --> 1:04:02.440 big difference. All right, everybody, have a good and safe weekend. 1:04:02.520 --> 1:04:05.720 This is Bloomberg. H