WEBVTT - Bloomberg Businessweek Weekend - May 30th, 2025 0:00:00.320 --> 0:00:07.280 Bloomberg Audio Studios, Podcasts, radio News. 0:00:08.720 --> 0:00:13.040 This is Bloomberg Business Week Daily reporting from the magazine 0:00:13.039 --> 0:00:17.640 that helps global leaders stay ahead with insight on the people, companies, 0:00:17.680 --> 0:00:22.560 and trends shaping today's complex economy. Plus global business finance 0:00:22.600 --> 0:00:26.320 and tech news as it happens. The Bloomberg Business Weekdaily 0:00:26.440 --> 0:00:31.520 Podcast with Carol Masser and Tim Steneveek on Bloomberg Radio. 0:00:31.880 --> 0:00:34.760 Hi, everyone, Welcome to the Bloomberg Business Wee Weekend Podcast. 0:00:35.200 --> 0:00:38.120 This week and video earnings, more, talk about tariffs and 0:00:38.200 --> 0:00:41.880 onshoing and the latest read on US inflation. Not a 0:00:41.920 --> 0:00:44.760 busy week, it was a holiday shortened trading week. For 0:00:44.840 --> 0:00:46.800 the latest on all of it, head over to Bloomberg 0:00:46.840 --> 0:00:47.400 dot com. 0:00:47.640 --> 0:00:49.680 With that as our backdrop, we share a bit of 0:00:49.680 --> 0:00:52.720 our Nvidia earnings reaction courtesy of our own at Ludlow 0:00:52.800 --> 0:00:56.160 after is sit down with Nvidia CEO Jensen Wong. The 0:00:56.200 --> 0:00:58.880 stock rallied after the report. More on that in just 0:00:58.920 --> 0:00:59.600 a moment. 0:00:59.480 --> 0:01:02.760 Plus this hour. Why tariffs alone are not enough to 0:01:02.800 --> 0:01:08.000 reindustrialize America, so argues the CEO of Speculative Technologies, plus 0:01:08.080 --> 0:01:11.399 the small Asian nation pois to win nuclear energies nine 0:01:11.440 --> 0:01:13.240 trillion dollar comeback, and. 0:01:13.160 --> 0:01:15.800 It's been six years since the murder of George Floyd? 0:01:16.200 --> 0:01:19.120 Have we seen any progress since that? The President of 0:01:19.120 --> 0:01:21.920 the Urban League stops by in our second hour with 0:01:22.000 --> 0:01:25.319 a reality check in interestingly enough, his thoughts on the 0:01:25.400 --> 0:01:27.959 US steal and Nippon Steele tie up all of. 0:01:27.920 --> 0:01:30.840 That to come. We begin with what was probably safe 0:01:30.840 --> 0:01:35.680 to say the top tech, the top AI earnings, market, investment, 0:01:35.720 --> 0:01:38.920 and business story of the week all rolled into one, 0:01:39.240 --> 0:01:41.240 and by that we mean earnings from the world's largest 0:01:41.240 --> 0:01:45.360 semiconductor company and video. After the company's earnings call, CEO 0:01:45.600 --> 0:01:48.480 Jensen Wong sat down with Bloomberg Technology co hosted Ludlow 0:01:48.560 --> 0:01:51.640 to talk about the results. Bloomberg News senior semiconductor networking 0:01:51.640 --> 0:01:53.840 reporter Ian King joined us with more. 0:01:54.280 --> 0:01:57.120 Ian, I just want to get a clear understanding from 0:01:57.160 --> 0:02:03.040 you about where exactly in video up for concern around China, 0:02:03.080 --> 0:02:06.480 because that was a big question moving in to their earnings, 0:02:06.520 --> 0:02:09.679 and then also with regard to the restrictions that have 0:02:09.800 --> 0:02:12.800 been placed on the company by the Trump administration with 0:02:12.800 --> 0:02:15.600 regard to the H twenty chip, Where did in video 0:02:15.680 --> 0:02:16.280 make up for this? 0:02:17.120 --> 0:02:19.720 Yeah, I know you're asking the right question here and 0:02:19.840 --> 0:02:21.760 in many respects. It was a kind of a bizarre 0:02:22.120 --> 0:02:26.760 announcement and reaction. They said, look, things in China were 0:02:26.800 --> 0:02:30.680 worse than you thought, right, and are going to continue 0:02:30.680 --> 0:02:32.639 to be worse than you thought. We're going to lose 0:02:32.960 --> 0:02:37.519 eight billion dollars of revenue from China, so clearly, well, 0:02:38.280 --> 0:02:40.240 but why your earning is that bad then? And the 0:02:40.280 --> 0:02:42.320 answer was because everything else is good? 0:02:42.840 --> 0:02:43.120 Right. 0:02:43.720 --> 0:02:48.600 Networking came back that had been a slightly weak spot 0:02:48.600 --> 0:02:53.880 a quarter ago, the new Blackwell range based products getting 0:02:53.960 --> 0:02:56.119 more supply of that. Things are going a lot better. 0:02:56.200 --> 0:03:00.800 Their demand is really going very well. And they talked 0:03:00.800 --> 0:03:03.959 about the spread of their technology into the enterprise or 0:03:04.040 --> 0:03:06.679 robotics to automotive, but that was a bit more sort 0:03:06.680 --> 0:03:09.040 of longer term. The bottom line here is that the 0:03:09.080 --> 0:03:14.919 big spenders on this technology, the Microsoft's, the Amazons, are still. 0:03:14.639 --> 0:03:18.040 Spending thank god, right for the hyperscalers Ian is it 0:03:18.040 --> 0:03:20.720 broadening out? Though? Beyond that, I think there was a 0:03:20.720 --> 0:03:24.800 lot of wondering about the Tier two companies, the sovereign 0:03:24.880 --> 0:03:29.760 play here, which provides potential, lots of potential maybe for 0:03:29.880 --> 0:03:32.040 in video going forward. Do we get anything on that? 0:03:32.960 --> 0:03:37.880 Yeah, in a word, no, we got plenty of it. 0:03:37.920 --> 0:03:42.200 But it's not broadening out. Fifty percent of their data 0:03:42.200 --> 0:03:46.040 center business was still these so called hyperscalis. I mean, 0:03:46.040 --> 0:03:48.320 they talked a lot about it broadening out and finding 0:03:48.360 --> 0:03:51.120 its way into other parts of the economy. And I 0:03:51.160 --> 0:03:55.320 guess you could say that, well, maybe enterprises, you know, 0:03:55.360 --> 0:03:59.920 the corporations, governments, service providers using more of the cloud services, 0:04:00.200 --> 0:04:02.840 that the use of AI is broadening, but in terms 0:04:02.880 --> 0:04:06.360 of the revenue makeup, that's still very solidly going to 0:04:06.440 --> 0:04:10.400 these so called hyperscalers. And I think long term investors 0:04:10.440 --> 0:04:14.520 want to see that fifty percent ratio go considerably lower 0:04:14.600 --> 0:04:18.360 to have a real assurance that everybody's putting this gear 0:04:18.400 --> 0:04:23.080 in their own data centers and their own nationalized centers 0:04:23.400 --> 0:04:25.680 before they'll become more comfortable with the idea. 0:04:26.240 --> 0:04:29.920 Yeah, I'm curious if, in your view, in Video's mote, 0:04:29.920 --> 0:04:32.880 when it comes to the technology that it has, is 0:04:32.920 --> 0:04:36.880 getting any more shallow right now, or if it's getting deeper. 0:04:36.920 --> 0:04:39.080 We did speak in our covery to some folks who 0:04:39.120 --> 0:04:43.000 reminded us that a company such as Alphabet's Google is 0:04:43.040 --> 0:04:46.919 creating their own technology that helps them rely less on 0:04:46.960 --> 0:04:49.360 a company such as in Video. How is in Video's 0:04:49.400 --> 0:04:51.760 moat right now, A. 0:04:51.800 --> 0:04:53.640 Couple of ways to look at it. The numbers would 0:04:53.640 --> 0:04:58.760 indicate that nobody's even getting close, right, it's outgrowing everybody. 0:04:58.800 --> 0:05:02.400 I mean, the revenue it gave up in China is 0:05:02.440 --> 0:05:06.120 more than the total revenue for AMD, which is purportedly 0:05:06.240 --> 0:05:11.080 its nearest competitor, right, so scale wise, I forget about it, right, 0:05:11.160 --> 0:05:16.159 But part of that interview, what Jensen said was, look, Huawei, 0:05:16.200 --> 0:05:19.400 which is the Chinese, you know, technology company that the 0:05:19.480 --> 0:05:21.920 US government has gone to great lengths to kind of 0:05:21.960 --> 0:05:24.720 lock out of the world, is fueling a chip now 0:05:24.800 --> 0:05:27.600 which is pretty much as good as our H two hundred. 0:05:27.839 --> 0:05:30.720 And you remember, up until earlier this year, H two 0:05:30.760 --> 0:05:34.080 hundred was the best thing that Nvidia had. So he 0:05:34.200 --> 0:05:36.839 was cautioning that, you know, in our absence in China, 0:05:36.960 --> 0:05:39.880 is actually fueling competition there, and they are doing a 0:05:39.880 --> 0:05:42.760 lot better than you thought they were doing well. 0:05:43.120 --> 0:05:45.160 So help me understand, because I thought when these headlines 0:05:45.200 --> 0:05:48.600 I try, I'm trying to understand they are saying that 0:05:48.640 --> 0:05:50.840 they're considering trying to design a new chip for the 0:05:50.960 --> 0:05:55.880 Chinese market. As we know, the administration has you know, 0:05:56.000 --> 0:05:59.400 kind of slowed Some are certainly the more sophisticated ships. 0:05:59.400 --> 0:06:02.760 At the same time, I'm you know, executives, from what 0:06:02.800 --> 0:06:06.080 we understand from the conference call at in VIDI are 0:06:06.120 --> 0:06:09.000 spending a lot of time reaching out to the government 0:06:09.040 --> 0:06:12.640 to like lift some of these restrictions. So help me understand, 0:06:13.279 --> 0:06:16.320 does it sell like Nvidia expects that China will reopen 0:06:16.560 --> 0:06:18.800 or I don't know. I'm just trying to understand if 0:06:18.800 --> 0:06:20.880 that is going to be you know, more of a 0:06:20.920 --> 0:06:22.880 healthier revenue stream for them going forward. 0:06:23.680 --> 0:06:26.800 Yeah, So that was a very you know that that's 0:06:26.839 --> 0:06:29.400 the right question that everybody is asking, and it was 0:06:29.440 --> 0:06:32.680 asked explicitly and implicitly in a number of ways on 0:06:32.720 --> 0:06:36.520 the conference call. What in Nvidia said was was, look, sure, 0:06:36.560 --> 0:06:39.839 we'd like to have another solution. We'd like to go 0:06:39.960 --> 0:06:42.120 back to doing what we did, which was find a 0:06:42.160 --> 0:06:45.200 way to get a chip that does not trigger these restrictions. 0:06:45.279 --> 0:06:49.040 But frankly, these restrictions are so stringent at this point, 0:06:49.520 --> 0:06:51.320 is there a point in doing that. Is there a 0:06:51.320 --> 0:06:53.320 way that we can do this technically and have a 0:06:53.400 --> 0:06:57.480 chip in China which the Chinese want and doesn't raise 0:06:57.520 --> 0:06:59.680 the hore of our government And they thought they'd done 0:06:59.680 --> 0:07:03.120 that the H twenty and they thought that perhaps the 0:07:03.160 --> 0:07:07.520 Trump administration might take a different line to the Biden administration, 0:07:07.960 --> 0:07:10.320 but they didn't. They double down on that policy, and 0:07:10.360 --> 0:07:12.400 they said, no, you can't even have the H twenty, 0:07:12.840 --> 0:07:15.920 which is, you know, a weakling, younger brother of the 0:07:16.080 --> 0:07:19.360 H two hundred we just talked about. So is there 0:07:19.400 --> 0:07:21.880 any point was part of what the question part of 0:07:21.920 --> 0:07:23.120 the answer that they gave. 0:07:23.480 --> 0:07:26.120 In your view does maybe not in your view, but 0:07:26.160 --> 0:07:28.000 in the view of some of the folks you speak 0:07:28.040 --> 0:07:30.720 to when you're doing your reporting. Does a restrictions such 0:07:30.720 --> 0:07:34.240 as this actually help push China to develop its own technology? 0:07:35.400 --> 0:07:38.400 I mean it already has done, right, I mean Jensen 0:07:38.600 --> 0:07:40.440 said that. I mean you could argue it's in his 0:07:40.480 --> 0:07:44.640 interest to create a scare that would persuade people to 0:07:45.000 --> 0:07:48.640 come to his point of view. But there's no denying 0:07:48.680 --> 0:07:52.040 that there are large scale deployments now of wildway tips. 0:07:52.120 --> 0:07:54.720 Hey, real quickly before we go out there. Republican centater 0:07:54.760 --> 0:07:58.520 Jim Banks and Democrat Elizabeth Warren are demanding answers from Jensen, 0:07:59.240 --> 0:08:03.120 Wong and Video's plans to actually open up a research 0:08:03.160 --> 0:08:06.200 facility in Shanghai, and they are of course citing national 0:08:06.200 --> 0:08:08.680 security and economic security concerns. Should we be scratching our 0:08:08.720 --> 0:08:12.720 head on that considering the backdrop between US and China 0:08:12.800 --> 0:08:13.160 right now? 0:08:13.760 --> 0:08:16.400 Yeah, I mean, I don't want to be rude about 0:08:16.440 --> 0:08:20.040 our competition, but they perhaps need to work a little 0:08:20.040 --> 0:08:23.720 bit harder on that one. This is already asked and answered. 0:08:24.160 --> 0:08:27.280 This is a new office, an office to help people 0:08:27.480 --> 0:08:30.360 to return to work. In Vidia has said publicly nothing 0:08:30.360 --> 0:08:32.600 to do with the research and design center, and so 0:08:32.720 --> 0:08:36.720 perhaps those politicians met to not read everything that they 0:08:37.000 --> 0:08:40.040 has written out there. Perhaps the want to check on 0:08:40.080 --> 0:08:41.160 the reporting. 0:08:41.160 --> 0:08:44.360 That was Bloomberg New senior Semiconductor and networking reporter Ian King. 0:08:44.679 --> 0:08:47.360 Okay, well, the street and many investors are still very 0:08:47.400 --> 0:08:49.600 bullish on Invidia. I mean, just check out what the 0:08:49.640 --> 0:08:52.720 share price did right after the earnings release. We also 0:08:52.800 --> 0:08:56.040 got the bear case from someone on the street. We're 0:08:56.040 --> 0:09:00.000 talking about Jay Goldberg, senior analyst covers semiconductors and electronics 0:09:00.240 --> 0:09:03.079 at Seaport Research Partners. He's the only analyst on the 0:09:03.120 --> 0:09:06.120 Bloomberg terminal who has a cell rating on Nvidia. 0:09:06.240 --> 0:09:09.839 My take is that in Vidia the most scrutinized company 0:09:09.840 --> 0:09:11.559 in the planet. We all have a pretty good sense 0:09:11.600 --> 0:09:13.600 of what their numbers should look like this year, what 0:09:13.640 --> 0:09:16.520 their capacity is working backwards from that, there's not a 0:09:16.520 --> 0:09:19.640 lot of room left for upside, right, There's a few 0:09:19.679 --> 0:09:22.040 things here and there, but there's not much upside possible. 0:09:22.240 --> 0:09:24.000 But on the downside, there's still a lot of risks. 0:09:24.000 --> 0:09:25.440 There are a lot of things that could go wrong. 0:09:26.200 --> 0:09:28.800 There's lots of problems with the supply chain. The fact 0:09:28.800 --> 0:09:31.400 that the keeper mentioning that Blackwell is ramping, that was 0:09:31.440 --> 0:09:33.719 in doubt for a while. There's just a lot of 0:09:33.800 --> 0:09:36.520 questions the company. It's a good company, it's well run. 0:09:36.840 --> 0:09:38.959 It's just gotten so big so quickly. I don't think 0:09:38.960 --> 0:09:43.560 they can keep this. The level of expectations beating that 0:09:43.600 --> 0:09:45.640 they've had for the last three years, that just can't 0:09:45.720 --> 0:09:46.160 keep going. 0:09:46.200 --> 0:09:49.000 And I think the headwinds are continuing to mount. 0:09:49.200 --> 0:09:52.640 In the earning statement, in video, CEO Jensen Wong saying 0:09:52.679 --> 0:09:56.640 global demand for Nvidia's AI infrastructure is incredibly strong. AI 0:09:57.240 --> 0:10:00.960 inferenced token generation has surged tenfold in just one year, 0:10:01.080 --> 0:10:04.120 and as AI agents become mainstream, the demand for AI 0:10:04.200 --> 0:10:08.920 computing will accelerate. Jay obviously sounds upbeat, but again, you know, 0:10:08.960 --> 0:10:11.640 this is where we want to have some numbers around things, 0:10:12.280 --> 0:10:16.280 the CFO saying sales of their H twenty products four 0:10:16.320 --> 0:10:19.600 point six billion for the first quarter of twenty twenty six. 0:10:21.000 --> 0:10:22.800 Is there anything that could kind of make you say, well, 0:10:22.840 --> 0:10:25.280 wait a minute, maybe I need to say it's not 0:10:25.360 --> 0:10:27.679 a sell. Maybe there is something interesting here. 0:10:28.720 --> 0:10:31.280 So I think the underlying question is what are we 0:10:31.320 --> 0:10:32.880 going to do with AI? Like there's a lot of 0:10:32.920 --> 0:10:36.240 excitement around AI, but it's still in very early stages, 0:10:36.360 --> 0:10:37.800 you know. I like to think of this as the 0:10:37.800 --> 0:10:41.080 Internet in the nineteen seventies. We knew it was something, 0:10:41.160 --> 0:10:43.160 but we didn't know what it would become. I think 0:10:43.160 --> 0:10:45.480 that's where we are with AI now, and I think 0:10:45.520 --> 0:10:47.520 it's going to take a few years for us to 0:10:47.600 --> 0:10:50.760 really as an industry figure out what the actual consumer 0:10:50.920 --> 0:10:54.800 use cases and applications are. And in that process there's 0:10:54.840 --> 0:10:56.880 going to be some fits and starts, and I just 0:10:56.920 --> 0:10:58.960 don't think we can keep this momentum going forever. I 0:10:58.960 --> 0:11:01.520 know demand is good now now, but we start to 0:11:01.559 --> 0:11:03.880 look into next year. I think people are starting to 0:11:03.920 --> 0:11:06.800 ask good questions about what is the ROI and these 0:11:06.800 --> 0:11:10.360 massive GPU investments all the hyperscalers and the enterprises have made, 0:11:10.559 --> 0:11:13.040 and I don't think we've seen those yet. I think 0:11:13.040 --> 0:11:16.280 what would sort of alter my belief is if somebody 0:11:16.320 --> 0:11:20.800 invents some incredible consumer application for AI that would radically 0:11:21.360 --> 0:11:22.160 accelerate things. 0:11:22.520 --> 0:11:26.240 That was Jay Goldberg, senior analyst on Semiconductors and Electronics 0:11:26.240 --> 0:11:29.720 at Seaport Research Partners, once again, the only analyst on 0:11:29.800 --> 0:11:32.719 the terminal who's got a celerating on Nvidia and. 0:11:32.679 --> 0:11:34.439 Sticking to it, at least sticking to it that far. 0:11:34.520 --> 0:11:37.480 Hey, he likes being a contrariant, he told us. 0:11:37.840 --> 0:11:39.680 Yeah, he had some really good thoughts kind of on 0:11:39.760 --> 0:11:42.480 AI more broadly too. All right, coming up, Why tariffs 0:11:42.520 --> 0:11:46.280 will not lead to an American manufacturing revival, so argues 0:11:46.360 --> 0:11:47.200 our next guest. 0:11:47.600 --> 0:11:48.760 This is Bloomberg. 0:11:49.920 --> 0:11:53.720 You are listening to the Bloomberg Business Weekdaily Podcast. Catch 0:11:53.800 --> 0:11:57.040 us live weekday afternoons from two to five pm Eastern 0:11:57.160 --> 0:12:00.160 Listen on Apple CarPlay and Android Auto with the Loom's 0:12:00.320 --> 0:12:03.839 Business app, or watch us live on YouTube. 0:12:03.960 --> 0:12:06.360 This past weeks, i'm legal back and forth on President 0:12:06.360 --> 0:12:09.440 Trump's tariff push. The latest, as we put this week's 0:12:09.440 --> 0:12:12.640 Business Week to bed, was a federal appeals court that 0:12:12.800 --> 0:12:16.000 temporarily blocked a ruling that threatened to throw out the 0:12:16.000 --> 0:12:19.280 bulk of President Trump's tariff agenda, giving the White House 0:12:19.320 --> 0:12:22.600 hope to continue its efforts to rewrite the global trading order. 0:12:22.840 --> 0:12:24.760 Now for the latest head on over to Bloomberg dot 0:12:24.760 --> 0:12:28.040 com as it continues to be a developing story. Now, 0:12:28.320 --> 0:12:31.160 keep in mind, part of the president's justification is to 0:12:31.200 --> 0:12:33.920 get more companies to produce in the United States, invest 0:12:33.960 --> 0:12:37.120 in the United States, and grow domestic manufacturing. And to 0:12:37.240 --> 0:12:40.199 be fair, Tim, we heard from a lot of companies 0:12:40.280 --> 0:12:43.439 global companies about investing in the US or at least 0:12:43.480 --> 0:12:46.120 plans to do so and ramp up their exposure here. 0:12:46.480 --> 0:12:49.000 When you think about the history of American manufacturing, it 0:12:49.120 --> 0:12:52.040 was actually at its peak just ahead of the financial crisis. 0:12:52.520 --> 0:12:55.719 But as Dan Wang, a research fellow at Stanford University's 0:12:55.720 --> 0:12:59.080 Hoover History Lab, and Ben Reinhart, the CEO of the 0:12:59.160 --> 0:13:03.480 nonprofit in Industrial Research Labs Speculum Technologies, right in the 0:13:03.520 --> 0:13:07.960 June issue of Bloomberg BusinessWeek magazine, American industry has certainly 0:13:08.240 --> 0:13:11.520 seen better days, and it's never recovered to those levels. 0:13:12.000 --> 0:13:14.600 They argue, though, that tariffs are not the solution to 0:13:14.679 --> 0:13:17.760 revitalizing the sector. Ben, you have a tariff free menu 0:13:17.840 --> 0:13:20.640 of policies that offer a sure path to revitalize in 0:13:20.760 --> 0:13:23.280 US manufacturing. You and Dan, right before we get there, 0:13:23.679 --> 0:13:26.880 explain for everybody what an industrial research lab is. 0:13:27.600 --> 0:13:30.760 Well, so I like to describe it as we are. 0:13:31.080 --> 0:13:33.199 We're a research lab in the sense that we are 0:13:33.240 --> 0:13:36.280 working on trying to create new technologies. We're not working 0:13:36.320 --> 0:13:38.720 on products, but at the same time, we're trying to 0:13:38.760 --> 0:13:41.439 do research that is not just trying to discover the 0:13:41.480 --> 0:13:43.520 secrets of the universe, but really. 0:13:43.679 --> 0:13:45.119 Build useful technologies. 0:13:45.240 --> 0:13:47.800 So that's sort of the line, like to think that 0:13:47.840 --> 0:13:49.800 we're walking where it's like we're doing stuff that doesn't 0:13:49.840 --> 0:13:53.360 make sense yet as a company, I wouldn't go to 0:13:53.360 --> 0:13:55.440 an investor and say, you can make a bunch of money, 0:13:55.559 --> 0:13:58.040 But we are nevertheless like trying to do things that. 0:13:58.000 --> 0:14:01.800 Eventually will become useful. So thing the labs Xerox Park 0:14:02.000 --> 0:14:02.679 that sort of. 0:14:02.640 --> 0:14:05.920 Work very cool, So sort of a skunk works type 0:14:05.960 --> 0:14:10.000 of thing, exactly pre product. Okay, you and Dan thought 0:14:10.000 --> 0:14:12.280 a lot about have been thinking a lot about tariffs 0:14:12.320 --> 0:14:14.560 and the way that the President has been trying to 0:14:14.600 --> 0:14:18.680 revitalize American manufacturing. His love for tariffs is no secret. 0:14:18.960 --> 0:14:21.880 We've known about it for many, many decades, but I 0:14:21.920 --> 0:14:25.040 think perhaps it caught some investors off guard back in 0:14:25.080 --> 0:14:28.360 April when he announced the reciprocal tariffs on so called 0:14:28.400 --> 0:14:32.160 Liberation Day, you argue that there are better ways to 0:14:32.240 --> 0:14:35.680 revive manufacturing in the US. You say, we should look 0:14:35.720 --> 0:14:36.800 at what China has done. 0:14:37.480 --> 0:14:40.600 Yeah, so there are two things in particular that they've 0:14:40.600 --> 0:14:44.320 done that. So they've done many things, some of them 0:14:44.880 --> 0:14:47.000 we don't think that we should copy. But there are 0:14:47.000 --> 0:14:50.240 two in particular that I think are particularly worth looking at. 0:14:51.560 --> 0:14:55.240 One of them is inviting in for an investment. Right, 0:14:55.320 --> 0:14:58.120 so actually one of the ways that they built up 0:14:58.120 --> 0:15:03.960 their manufacturing is inviting in foreign companies and uh, you know, 0:15:03.960 --> 0:15:07.440 getting them to build factories there and sort of regardless 0:15:07.480 --> 0:15:10.240 of your position on uh stealing technology, you. 0:15:10.240 --> 0:15:12.760 Still build up a workforce that knows how to build those. 0:15:12.600 --> 0:15:15.720 Things and then can go and uh, you know, build 0:15:15.720 --> 0:15:18.960 that technology. So you can imagine inviting in Chinese companies 0:15:19.000 --> 0:15:22.680 even who have now technologies that that we don't have, 0:15:23.080 --> 0:15:26.120 and you then build up a workforce who knows how to, say, 0:15:26.160 --> 0:15:26.880 make bad batteries. 0:15:27.000 --> 0:15:27.560 So that's one. 0:15:27.960 --> 0:15:33.080 Two is like industrial zones, right, So so you're the 0:15:33.320 --> 0:15:35.800 most well known is Hinshen, but there are there are 0:15:35.840 --> 0:15:39.000 many others where they to a large extent, UH, the 0:15:39.040 --> 0:15:43.480 government took a very like hands hands off approach and 0:15:43.560 --> 0:15:46.240 just said like okay, like within this zone, you can 0:15:46.360 --> 0:15:48.040 basically do whatever you want. 0:15:49.120 --> 0:15:50.720 There's there's a lot of nuance to that. 0:15:51.040 --> 0:15:55.040 But right now we are it is extremely hard to 0:15:55.480 --> 0:15:57.600 build new UH new factories. 0:15:58.160 --> 0:15:59.720 I do want to push back a little bit on this. 0:15:59.800 --> 0:16:03.360 My one experience in China back in twenty nineteen, before 0:16:03.400 --> 0:16:06.240 the pandemic, I went to Shanghai. I know it's a 0:16:06.240 --> 0:16:08.760 completely different place now, but one thing that struck me 0:16:08.840 --> 0:16:11.400 was when the plane landed, I looked out the window 0:16:11.760 --> 0:16:13.360 and it was the thick what I thought was the 0:16:13.400 --> 0:16:16.000 thickest fog. It turned out it was pollution. My throat 0:16:16.040 --> 0:16:18.600 was sore the entire time I was there. We couldn't 0:16:18.600 --> 0:16:21.840 see out of our hotel room windows because we're on 0:16:21.920 --> 0:16:25.000 like the fifteenth floor, and the air was too clogged 0:16:25.040 --> 0:16:28.000 with pollution. As a result of some of the industrialization 0:16:28.040 --> 0:16:29.840 that we're talking about here, Do we really want that 0:16:29.920 --> 0:16:30.440 in the US? 0:16:30.800 --> 0:16:33.960 I don't think it's an either or sort of thing. 0:16:34.800 --> 0:16:38.200 Modern A lot of modern manufacturing technologies no longer produce 0:16:38.320 --> 0:16:43.040 that sort of that sort of waste, and a lot 0:16:43.080 --> 0:16:45.560 of the manufacturing that we're talking about doesn't do that, 0:16:46.240 --> 0:16:48.520 and there are many many technologies for cleaning that up. 0:16:48.600 --> 0:16:51.960 So you were seeing sort of the results of manufacturing 0:16:52.000 --> 0:16:55.120 technologies from like the fifties and sixties, and so we're saying, like, Okay, 0:16:56.120 --> 0:16:58.680 we're going to build technologies of the twenty first century, 0:16:58.680 --> 0:17:00.800 which have many few side effects. 0:17:00.800 --> 0:17:02.960 Ben, I gotta say, what's really cool is our Steve 0:17:03.040 --> 0:17:05.960 Man of our Bloomberg Intelligence team and covers the auto sector, 0:17:06.000 --> 0:17:08.880 and one of the things he has said recently to us, 0:17:08.880 --> 0:17:12.160 because as we think about tiraffs and bringing manufacturing back home, 0:17:12.560 --> 0:17:14.520 he said, one thing that China learned. I mean by 0:17:14.520 --> 0:17:17.960 doing all that manufacturing, they actually developed some very sophisticated 0:17:17.960 --> 0:17:22.360 technology that is now helping them to kind of operate 0:17:22.400 --> 0:17:24.679 on a higher plane. And whether it's developed cart like 0:17:24.760 --> 0:17:27.200 whatever have you. And I never thought about that. I 0:17:27.240 --> 0:17:30.040 guess I thought about bringing manufacturing back home. Do we 0:17:30.080 --> 0:17:32.119 really want to be making T shirts and sneakers? But 0:17:32.200 --> 0:17:35.160 that's not what it's about. It's about they've become very 0:17:35.200 --> 0:17:38.960 sophisticated with technology because of the automation and all of 0:17:39.000 --> 0:17:40.240 the manufacturing they've been doing. 0:17:40.359 --> 0:17:42.600 Oh yeah, couldn't agree. More. 0:17:43.520 --> 0:17:47.399 Manufacturing and new technology and research really go hand in hand. 0:17:47.880 --> 0:17:50.160 You can't have one without another, honestly, that's That's one 0:17:50.160 --> 0:17:51.960 of the reasons why I'm such a big proponent of 0:17:52.840 --> 0:17:54.280 manufacturing is because. 0:17:54.040 --> 0:17:54.960 We always put that together. 0:17:55.040 --> 0:17:55.320 Yeah. 0:17:55.400 --> 0:17:59.880 Yeah, it's like the best technologies, the best research comes 0:17:59.880 --> 0:18:03.719 from noticing a problem on an actual manufacturing line, right, 0:18:03.760 --> 0:18:05.960 Like going back to us being an industrial research labet, 0:18:05.960 --> 0:18:09.200 the point is to notice, oh, there's this actual, real 0:18:09.240 --> 0:18:11.520 problem in the world, and we need to do research 0:18:11.560 --> 0:18:12.000 to fix it. 0:18:12.080 --> 0:18:14.760 I think it's pretty well so is President Trump bright 0:18:14.880 --> 0:18:18.880 in terms of encouraging companies outside the United States, even 0:18:18.920 --> 0:18:22.320 American companies to start investing more here. 0:18:23.240 --> 0:18:25.080 Along that axis. 0:18:25.280 --> 0:18:31.640 Yes, I think I will not unequivocally agree with with everything. 0:18:31.480 --> 0:18:34.440 But encouraging for it. And as many have said to us, 0:18:34.760 --> 0:18:36.520 you know, there are commitments and then you'll see whether 0:18:36.560 --> 0:18:39.320 or not those commitments, which are often multi year commitments. 0:18:39.320 --> 0:18:41.880 And also you can't just build a factory overnight, right 0:18:42.080 --> 0:18:44.840 or a facility, but we'll see over time whether or 0:18:44.880 --> 0:18:45.960 not this actually happens. 0:18:46.080 --> 0:18:47.240 Yeah, I think so. 0:18:48.359 --> 0:18:51.400 I think that it would ideally be done with carrots 0:18:51.440 --> 0:18:52.200 and not sticks. 0:18:53.320 --> 0:18:54.760 But yes, I think that. 0:18:54.800 --> 0:18:56.840 The message, right, but maybe not the mode. Yeah exactly, 0:18:56.880 --> 0:18:57.680 is it at least your review? 0:18:57.800 --> 0:19:01.240 Yeah, okay, So that's one way to be thinking about 0:19:01.240 --> 0:19:04.560 this study China. I want to talk a little bit 0:19:04.880 --> 0:19:08.400 about some other solutions that you have preserving the strengths 0:19:08.400 --> 0:19:11.199 that America already has. Talk a little bit about what 0:19:11.240 --> 0:19:11.720 you mean by that. 0:19:12.000 --> 0:19:16.720 Yeah, So, you know, America has a lot of strengths 0:19:16.720 --> 0:19:20.119 that I feel like, like literally today we are uh, 0:19:20.600 --> 0:19:24.960 sort of throwing away right, Like we have this amazing 0:19:25.000 --> 0:19:27.560 ability to attract talent from all over the world. 0:19:27.760 --> 0:19:30.840 And if the universities let them in. 0:19:31.080 --> 0:19:35.000 Yeah exactly, and and the universities and in immigration right like, 0:19:35.240 --> 0:19:36.800 so historically. 0:19:36.280 --> 0:19:38.840 In all seriousness, I'm not bringing that up facetiously, I'm 0:19:38.880 --> 0:19:41.679 saying that that is at risk right now given the 0:19:41.800 --> 0:19:42.920 different rules that we've seen. 0:19:42.960 --> 0:19:43.800 Oh yeah exactly. 0:19:43.840 --> 0:19:47.200 And so so our point is like, don't like, don't 0:19:47.240 --> 0:19:50.879 stop like that's that is really and that is a 0:19:50.960 --> 0:19:54.080 unique strength of ours, right, Like, China doesn't attract global 0:19:54.080 --> 0:19:57.280 talent in the same way that we do. And again 0:19:57.720 --> 0:20:00.959 in our our university and research system. Also, so you know, 0:20:01.040 --> 0:20:04.720 you've seen the all like the cuts to NSF and 0:20:04.760 --> 0:20:08.040 NIH and NASA and the list goes on. And you know, 0:20:08.240 --> 0:20:11.800 our research ecosystem is the envy of the world, and 0:20:12.320 --> 0:20:15.960 we shouldn't, you know, keep keep that the case. 0:20:16.080 --> 0:20:18.240 What do you say to folks who say, listen, okay, 0:20:18.280 --> 0:20:20.639 you've got something like an IVY League that has an 0:20:20.680 --> 0:20:26.280 incredibly large endowment, So why does the government US government 0:20:26.320 --> 0:20:27.960 need to give them money to do R and D? 0:20:28.480 --> 0:20:30.679 So what's what's the argument to that? What you know, 0:20:30.960 --> 0:20:32.000